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operates under State law for public sector labor agreements. Again, the point that staff was trying to make is that this change cannot be done unilaterally. Ms. Ayala noted that the minutes also reflected a statement that indicated that a second tier retirement system did not exist today. Ms. McKeehan believed the minutes were providing a false impression. She reminded Council that it had discussed in closed session different options if Council chose to select different options if it was not satisfied with how the PERS retirement system works. Council would need to do something different through the Legislature to change how the retirement program is working in California. Council also discussed the private sector with respect to retirement benefits. She noted that there are many different retirement options that are available but only some of them are allowed today under certain circumstances with PERS. PERS has a very specific set of options that cities must choose from. The City is required to have its employees covered by the PERS retirement system; it does not have an option not to be covered by PERS. Mayor Pico did not believe this matter was relevant as the motion that was made a year ago was defeated. Mr. Brozosky indicated that he was confused on the action Council took a year ago and wanted some clarification as to what options are currently available. Mr. Campbell asked how this discussion related to the mid-term budget? Ms. Ayala believed that the mid-year budget review allowed the residents of Pleasanton an opportunity to take a look at the budget. This also allows Council the opportunity to discuss any pieces of the budget that might be troubling to individual councilmembers. Mayor Pico reiterated his previous comments. He believed the City had an affordable retirement program and one that provides outstanding employee benefits. He believed that the miscellaneous retirement rate of 15.2 percent is equivalent to the amount that individuals are paying for being covered under the Social Security system. Due to the outstanding management of the PERS retirement system in the past, the City has been able to provide a positive, lucrative retirement benefit to City employees at a cost that in many cases is less, historically, than the Social Security system. The City is fortunate to have a dedicated group of employees that contribute significantly to the operation of Pleasanton. He did not see any reason to change the retirement package that would destroy the morale between the employee groups, management and Council when the City of Pleasanton continues to run significant surpluses every year. Because she was elected to represent the public, Ms. Ayala believed that a discussion regarding the City's retirement package and the PERS system should be taken out of closed session and off the Consent Calendar and discussed in public. She said that her concerns and comments are not related to the capabilities of individual staff members. Pleasanton City Council 19 06/15/04 Minutes