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CONTRACT AMENDMENT COST ANALYSIS -VALUATION BASIS: June 30, 2006 SAFETY FIRE PLAN FOR CITY OF PLEASANTON Employer Number: 327 Benefit Description: Section 21548, Pre-Retirement Optional Settlement 2 Death Benefit As of Tune 30, 2006 Current Plan Post-Amendment 2008-2009 Employer Rate Payment for Normal Cost 15.336% 15.422% Payment on Amortization Bases 9.706% 9.810% Total Employer Rate 25.042% 25.232% Change to Normal Cost 0.086% Change to Total Employer Rate 0.190% Current Amortization Bases 1 Multiple Bases Amendment Amortization Base - Fresh Start Z N/A - Multiple Bases 20-year 2008-2009 Employee Rate Total Employee Rate 9.590% 9.590% Change to Total Employee Rate 0.000% 2009-2010 Estimated Employer Rate (recognizing 18.5"/o investment return for 2006-2007) 24.3% 24.5% Projection Amortization Base Multiple Base Multiple Base 1 -Details of the current amortlzation base are shown on page 13 of June 30, 2006 annual valuation report. If you have adopted any other subsequent amendments, the current amortizaton base Is the schedule after these adopted amendments. 2 - If a fixed number of years is shown, it means that the current unfunded actuarial (lability is projected and amortized over this fixed number of years. This amortization replaces the amortization schedule shown in your June 30, 2006 annual valuation and any other subsequent amendments you have adopted. 3 - If 20-year is shown, ft means that the change in (lability due to plan amendments is amortized separately over a 20-year period. This amortlzatlon schedule is in addition to the amortlzatlon schedule shown In the June 30, 2006 annual valuation and any other subsequent amendments you have adopted. In the above table, the information shown represents the actual initial contribution rate that will apply during fiscal year 2008-2009 if you adopt the amendment. However, these figures do not incorporate the projected 18.5% investment return in 2006-2007. The estimated employer rates shown for 2009-2010, which incorporate this return, will give you a good estimate of what to expect in 2009-2010. Note that the change in normal cost in the table above may be much more indicative of the long term change in the employer contribution rate due to the plan amendment. The plan's payment on amortization bases shown in the table above is a temporary adjustment to the employer contribution to "get the plan back on schedule". This temporary adjustment to the employer rate varies in duration from plan to plan. For example, a plan with initial excess assets being amortized over a short period of time will typically experience a large rate increase when excess assets are fully amortized. While a plan amendment for such a plan may produce little or no increase in the employer contribution rate now, the change in normal cost due to the plan amendment will become fully reflected in the employer contribution rate as soon as initial excess assets are fully amortized. November 16, 2007 Page 4