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BACKGROUND The International Association of Firefighters, Local 1974 (IAFF) covers a total of 104 sworn fire personnel, which includes 99 suppression and 5 prevention employees. (The ranks of Battalion Chief, Deputy Chief and Fire Chief are designated management employees and not represented by IAFF). The recently expired Memorandum of Understanding (MOU) with this group covered the period January 1, 2012 through June 30, 2014. In accordance with the agreement between Livermore and Pleasanton creating the Livermore-Pleasanton Fire Department (LPFD), the Joint Powers Authority Board (Agency) and the City Councils of Livermore and Pleasanton are the appropriate agencies to approve labor agreements with employees covered by bargaining units. Representatives of the partner cities met and conferred with representatives of IAFF and developed a successor agreement with term ending June 30, 2018. DISCUSSION In accordance with the Meyers-Milias-Brown Act, the parties are required to meet and confer in good faith over items covered within the scope of representation, including wages, hours and other terms and conditions of employment. The significant results of the negotiations include: Term of agreement: The expiration date of the proposed MOU is June 30, 2018, approximately three and one half (3.5) years from the date the document becomes operationally effective. The term of this contract, slightly longer than the recently expired agreement, allows for flexibility as well as stability for both employees and employers as the successor agreement concludes negotiations until 2018. Wage adjustments: Historically, the two primary factors considered in wage adjustment discussions are: market data obtained from neighboring agencies that are similar in size and perform municipal fire services, and the consumer price index (CPI), which reflects the general cost-of-living increase in the San Francisco-Oakland-San Jose area (approximately 2.8% in October 2014). The recently expired MOU provided no wage adjustments for the term of the contract. The proposed contract includes a 3% increase in January 2015, July 2015, July 2016 and July 2017. Benefits: Modifications to benefits include the following: Pension — Employee Contributions: The cost to fund the California Public Employees' Retirement System (CaIPERS) pension program is comprised of two parts. The first is a variable employer rate which is expressed as a percentage of salary for covered employees (in FY 2014/2015 this rate is 36.979%). The second is the contribution for which members are responsible. Page 2 of 5