CalPERS contract amendment approved [Updated]

An agreement between Laguna Beach and its police and fire department employees will save the city about $400,000 in the next two years.

FOR THE RECORD:
[An earlier version said that the city will save $400,000 in the next two years due to changes in just the police employees contracts, not from changes in the fire and police contract.]

The agreement was the basis for an amendment to the city’s contract with the California Public Employees Retirement System, approved Tuesday by the City Council.

The council had previously discussed the new terms at its Jan. 10 meeting.

Under the terms of the agreement, new sworn employees in the Laguna Beach department will pay more toward retirement benefits than veterans.

“Public opinion and escalating costs of retirement benefits prompted the city to pursue new agreements with safety personnel,” City Manager John Pietig said.

New sworn police hires will contribute 9% toward the city’s share of retirement costs, which pays the employees 3% of their highest salary at retirement age 55 for every year worked. Current employees, sworn and non-sworn, who previously contributed nothing, will begin to pay 2% toward the city’s 9% share, starting Jan. 6, 2013. Veterans are eligible to retire at 50.

Laguna’s firefighters negotiated a new contract in 2011, which increased current employee contributions to 4.5% of the city’s contribution to their retirement fund, but gave no raises.

An amendment to the CalPERS contract was required for the new contract with police department employees to become effective, which is expected April 2. A similar amendment was approved for city firefighters last year.

Resolutions modifying retirement contributions by sworn and non-sworn employees were approved by the council, as required by CalPERS. An ordinance authorizing the amendment was also approved.

The new 30-month agreement with police employees does not include cost of living increases.

In return for concessions by the police employees, the city will absorb the increase in medical premiums, up to 8.6% in 2012 and up to 10% in 2013.

The amended CalPERS contract does not apply to other bargaining groups in the city’s employ. Unrepresented safety and non-safety management employees also will not be affected.

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