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approximately $ 52.3 million. In accordance with our fiscal policies, these reserves can be used, if necessary, to fund one -time expenditures, but should be limited when applied to funding ongoing operating and maintenance expenditures. DISCUSSION Current Employee Bargaining Environment City employees are currently represented by three bargaining groups: Pleasanton City Employees Association /AFSCME Local 955, International Association of Fire Fighters Local 1974, and Pleasanton Police Officers' Association. In accordance with the state's Meyers- Milias -Brown Act, the City is required to meet and confer in good faith regarding wages, hours and other terms and conditions of employment with each bargaining group. The City's negotiations team is given parameters and authorization from the City Council to present proposals, and to in turn respond to the bargaining group's proposals and responses during the process. The meet and confer meetings conclude with a tentative agreement, which is then memorialized in a Memorandum of Understanding (MOU). The terms of the agreement vary by bargaining group, but, generally, in more difficult financial times they tend to have shorter terms to enable both parties an opportunity to adjust to changing economic conditions. Because of these shorter terms, a single focus item proposed by management or the bargaining group, such as modifications to existing CaIPERS Employer Paid Member Contribution (EPMC), is often achieved not in a single agreement, but over several agreements covering a number of years. As mentioned previously, included on this City Council agenda as Item 8 is a staff recommendation to approve a tentative agreement with the PCEA with a term ending March 31, 2013. In addition, Item 9 also highlights changes to CaIPERS EPMC contributions for our department heads, middle management and confidential employees. While these actions are unrelated to the PCEA agreement, they demonstrate and reinforce the City's commitment to meaningful pension reform. 1. Soft Hiring Freeze The City's soft hiring freeze has been in place since fiscal year 2008/09. Essentially, it involves a thorough review of all positions vacated due to attrition to determine if refilling is essential to meet the City's service needs. To date, thirty -nine (39) positions have not been refilled City -wide (including utilities) which have generated a cost savings of approximately $6.6 million. These cost savings have impacted current expenditures, and the freeze will remain in place until sometime in the future when the budget situation allows for further review. As a result, these savings will be extended into future years. While the freeze has been effective financially, resulting in $6.6 million dollars of savings to date, and the bargaining groups have worked cooperatively with the City to address the impacts of the freeze, modifications or alternative approaches to reducing the total number of City employees may be necessary to adjust to additional revenue reductions and inflationary increases in the future. Further, because many City services Page 4 of 9