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Mr. Bartel cautioned that he has reviewed only the summaries issued by the conference <br /> committee as well as press releases, and that he has not had an opportunity to see the actual <br /> language of the proposed legislation. He also noted that once the language is released to the <br /> public, it cannot be changed, meaning that if the legislature does vote on Friday it will be a <br /> simple up or down vote. Based on his understanding, the legislation would pertain almost <br /> exclusively to anyone hired after January 1, 2013 and perhaps laterals hired after January 1, <br /> 2013 and would have very little or no impact on current employee formulas. Retirement <br /> formulas would likely be what are referred to as a 2.7% at 57 based on three highest years <br /> earnings and the member contribution would be 50% of the total normal costs, which are <br /> expected to be in the neighborhood of 10-11% for new employees. Other components include <br /> salary caps and no retroactive benefits increases. The only substantial factor he felt applied to <br /> existing employees is a language change that would make it easier to negotiate for them to pay <br /> more than the current statutory 9% member contribution. He noted that there are certain <br /> components of the Governor's 12-point plan that are not in the legislation, ncluding a hybrid <br /> investment option and changes to other post retirement benefits. <br /> Councilmember McGovern asked if this would automatically pass down to each city, if <br /> approved. <br /> Mr. Bartel said his understanding is that it would be mandatory for all cities, excluding charter <br /> cities. <br /> Councilmember McGovern asked when this would go into effect. <br /> Mr. Bartel stated January 31, 2013. <br /> Councilmember McGovern asked and Mr. Bartel confirmed that if passed, the legislation would <br /> take effect regardless of what action the Council takes on this contract. <br /> Councilmember Thorne said he has been in communication with contacts in Sacramento all <br /> day, that there are a few points of confusion and that any comparison against the white paper <br /> will have to wait until the language is released Thursday morning. He asked if Mr. Bartel had <br /> any idea what the magnitude of"normal total cost" versus a percentage of total cost would be. <br /> Mr. Bartel said in looking at the 2.7% at 57 alternative formula the total normal cost would be <br /> 20%-22% for a 50% contribution of 10% to 11% as already mentioned. If applied to current <br /> formulas, the total normal cost for fire at 3% at 55 would likely be on order of 27%-28% of total <br /> pay, for a 50% contribution of 13%-14%. 3% at 50 would be roughly 25%, for a 50% contribution <br /> of about 12.5%. <br /> Councilmember Thorne said his latest understanding is that 3% would be entirely eliminated. <br /> Mr. Bartel confirmed. He explained that two pieces of legislation would be removed from the <br /> code and no longer available to new hires: SB 400, which enabled 3% at 50 and 3% at 55, and <br /> AB 616, which enabled the three non-safety enhanced formulas (2.5% at 55, 2.7% at 55 and <br /> 3% at 60). <br /> Councilmember Sullivan asked if these features are mandated or would have to be negotiated <br /> into union contracts. <br /> Mr. Bartel said it would be mandated for new employees. The only item that would be subject to <br /> negotiations would be any member contribution over 9%. <br /> Special City Council Minutes Page 3 of 5 August 28, 2012 <br />