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THE CITY OF see — l ^ ° CITY COUNCIL AGENDA REPORT pLEASANTONo June 4, 2013 Administrative Services TITLE: APPROVE MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF PLEASANTON AND AFSCME LOCAL 955/PLEASANTON CITY EMPLOYEES ASSOCIATION FOR A TERM ENDING MARCH 31, 2016 AND ADOPT RESOLUTION TO IMPLEMENT EMPLOYEE CONTRIBUTION TOWARDS CALPERS PENSION PLAN SUMMARY The Memorandum of Understanding (MOU) between the City of Pleasanton and AFSCME Local 955/Pleasanton City Employees Association (AFSCME/PCEA) expired on March 31, 2013. Representatives from the bargaining group and the City have met and conferred in good faith to develop a successor agreement covering the period from April 1, 2013 to March 31, 2016. AFSCME/PCEA ratified the agreement on May 6, 2013. The City introduced the key elements of the proposed MOU at the City Council meeting on May 21, 2013. The final step is for the City Council to approve the agreement. One provision of the successor agreement involves "classic" employees making additional contributions, above the 4% they are currently paying, towards the CaIPERS retirement program. Effective the pay period starting on May 25, 2013, these employees will contribute an additional 2%, for a total of 6%, of the member contribution. Effective on December 7, 2013 these members will contribute the full 8% of the member contribution towards the retirement program. CaIPERS requires that the governing board adopt a resolution to implement this change in contribution amount. ("Non-classic" members of AFSCME/PCEA are governed by the Public Employees Pension Reform Act that went into effective on January 1, 2013.) RECOMMENDATION That the City Council approve the Memorandum of Understanding negotiated between the City and AFSCME/PCEA and adopt the resolution to implement additional member contribution towards the CaIPERS pension program. FINANCIAL STATEMENT The approximate fiscal cost of the contract, taking into consideration the savings as a result of employees paying member contributions towards the pension program and the value of reducing 24 floating holiday hours, is approximately $1.15 million for a 3 year contract. (On an annualized basis, this translates to approximately $383,484 per year). The funds will be incorporated into the FY 2013/14 Operating Budget.