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EXHIBIT S These reforms would provide adequate and sustainable pensions for long -term employees in Alameda/Contra Costa County cities and enhance fiscal sustainability throughout the region. Next Steps Given that the two Management Associations have adopted these goals for pension reform, the following steps need to be taken: The City Managers Department of the League of California Cities has asked that regional approaches to pension reform be a topic of a panel discussion at the annual meeting in February 2010. The League Public Employment Committee and Board are also investigating pension reform recommendations on a statewide basis. Ideally, these efforts would result in a consistent policy from the League that can be advocated to the Legislature and Governor. The managers groups also recommend that Alameda and Contra Costa cities work with the League to seek legislative pension reform at the State level. These reforms should, at a minimum, include: ➢ Establishing a reasonable benefit cap for miscellaneous employees and safety employees, including retaining safeguards against spiking which creates pensions of 100% or more of final salary; ➢ Giving employers flexibility to determine when part-time employees are entitled to pension benefits; and ➢ Changing Ca1PERS Board membership to achieve better employee /employer balance and greater public agency representation; and ➢ Allowing existing employees to be enrolled in negotiated new tier plans on a prospective basis. The East Bay Division of the League of California Cities should advocate these changes to the League Board and to our State representatives. The working group identified further potential legislative amendments that could be important in overall pension reform efforts. They are not outlined here, as we focused on highlighting the factors most critical to local agencies. It will be valuable for individual City representatives to articulate other identified possible legislative changes of interest. We suggest that information be provided to the League Board through the East Bay Division, the City Managers Department, the Employee Relations Department and the Employee Relations Policy Committee. Short of comprehensive State action, any significant pension reform will only happen on a city -by- city basis. Individual city managers will need to discuss these recommendations with their city councils and seek direction to begin negotiating pension reform as labor agreements expire. In this way, sustainable and defensible pension plans will become the norm, over time, among Alameda/Contra Costa County cities. It is clearly understood that not all cities will reach these goals to the same extent within the same time frame. Members of the Pension Reform Task Force, listed below, are available as resources to explain the research and discussion that led to this recommended set of goals for local pension reform. 4