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contributions from employees and the transition from 3% at 50 to 55 results in substantial savings through FY 2021-22; • New retiree medical program benefits for new hires include single party coverage only and end when the employee becomes Medicare eligible; • They also worked on a number of other things related to scheduled time off, clarification of shift and scheduling matters and frequency of performance evaluations; • Exhibit B reflects the number of agencies which are still at 3% at 50 and the less than 5 which have migrated to the second tier, Pleasanton being one of them. Councilmember McGovern said the Council has discussed having a fiscal policy to reduce 10% liability and she asked if staff will bring something forward to review the savings the City receives from employees paying their portion of PERS and using this in a positive way to sustain their pensions by applying it to the unfunded liability. Mr. Fialho asked the Council to be thoughtful in terms of how they apply this money and suggested it be reviewed during the budget process. Staff's hope is to redirect at least half of that savings towards the unfunded liability. He said in May, the second year of the two-year budget will come forward to the Council as an amendment. Mayor Hosterman invited public comment David Miller, member of the Tri-Valley Patriots Tea Party, said the Tea Party loves the police and considers it an outrage that valued City employees are now confronted by the reality of unsustainable promises made by irresponsible past politicians. The current pension cost structure is unsustainable and on a path to failure. They must ensure police have a realistic retirement plan without bankrupting the City. He said it time to demand politicians in Sacramento and locally to stop promising benefits they cannot realistically guarantee. California's pension system is broken, underfunded, and unsustainable. Continuing down the path hoping that the markets will recover and CaIPERS enjoying internet bubble returns indefinitely is insane. He asked for a retirement plan does not cause conflict between city workers and taxpayers when the stock market goes up and down. He asked to honor all pension benefits earned by City workers so far, but asked that going forward to discard the defective and un- repairable CaIPERS pension system and work together on an alternative program that respects taxpayers and children's futures. Jan Jones echoed Mr. Miller's points and commended the work that has taken place thus far with bargaining groups. She thanked staff for negotiating with police and hopes that the process with the fire bargaining unit will be accomplished. She thinks that they all can work together to get the best solution. Her concern is that with unfunded liabilities, they are not the only City that potentially could go bankrupt. She and her husband are trying to maintain their business which contributes to the tax base which pays for services and she hopes that everyone can hang on and continue to tighten their belts. Josh Christensen, Pleasanton Police Officer, said these are challenging economic times for residents, businesses and City government. While the City reserves top above $20 million and the City is not as bad off as other cities, police officers are realists, they understand the need to cut back and do more now, and he voiced support of the contract. Richard Trovao, Pleasanton Police Officer, said all officers work hard and are 100% committed to protecting citizens of the community. They agree to pay more towards their pensions, saving the City $2.4 million for the terms of the contract. They care about the community, the City and the future. Others tonight say these reforms do not go far enough, but as a City not as adversely affected by the downturn in the economy, with a $20 million reserve, his family will be paying over $1,000 a month if the contract is approved. He was not sure they could pay more; officers appreciate the work done negotiating the contract and like the Council, care about citizens. City Council Minutes Page 22 of 26 February 7, 2012