HomeMy WebLinkAboutAgenda Report - June 1, 2011 C-13*:bAGENDA ITEM &wj
&Q% CITY OF LODI
COUNCIL COMMUNICATION
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AGENDA TITLE: Adopt Resolution Amending the CalPERS Contract Allowing Employees to Make
Retirement Contributions with Pre-tax Payroll Deductions
MEETING DATE: June 1,2011
SUBMITTED BY: Human Resources Manager
RECOMMENDED ACTION: Adopt Resolution amending the CalPERS contract allowing
employees to make retirement contributions with pre-tax payroll
deductions
BACKGROUND INFORMATION: The City of Lodi is a member of the California Public Employees
Retirement System (CalPERS). Retirement contributions are
segmented into employer -paid contributions and employee -paid
contributions. Prior to July 1, 2011, the City paid both the employer
and employee -paid contribution amounts.
Effective July 1, 2011, most City employees will begin contributing towards their employee -paid
retirement costs. CalPERS requires the City adopt the attached resolution to allow employees to
contribute towards their retirement using pre-tax payroll deductions. Most agencies whose employees
contribute to their retirement costs have also passed the attached CalPERS Resolution.
FISCAL IMPACT: There is no fiscal impact related to this agenda item since it only allows employees
to contribute towards their retirement costs using pre-tax payroll deductions.
FUNDING AVAILABLE: Not applicable.
Jordan vers, Deputy City Man er/Interna I Services Director
APPROVED: k �----�
Konradt Bartlam, City Manager
RESOLUTION NO. 2011-87
A RESOLUTION OF THE LODI CITY COUNCIL
APPROVING EMPLOYER PICK-UP — IRC 414(H)(2)
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WHEREAS, the governing body of the City of Lodi has the authority to implement
the provisions of Section 414(h)(2) of the Internal Revenue Code (IRC); and
WHEREAS, the Board of Administration of the California Public Employees'
Retirement System adopted its resolution regarding Section 414(h)(2) IRC on
September 18, 1985; and
WHEREAS, the Internal Revenue Service has stated in December 1985 that the
implementation of the provisions of Section 414(h)(2) IRC pursuant to the Resolution of
the Board of Administration would satisfy the legal requirements of Section 414(h)(2)
IRC; and
WHEREAS, the City of Lodi has determined that even though the implementation
of the provisions of Section 414(h)(2) IRC is not required by law, the tax benefit offered
by Section 414(h)(2) IRC should be provided to its employees who are members of the
California Public Employees' Retirement System.
NOW, THEREFORE, BE IT RESOLVED by the Lodi City Council as follows:
That the City of Lodi will implementthe provisions of Section 414(h)(2) Internal
Revenue Code by making employee contributions pursuant to California
Government Code Section 20691 to the California Public Employees'
Retirement System on behalf of its employees who are members of the
California Public Employees' Retirement System. "Employee Contributions"
shall mean those contributions to the California Public Employees' Retirement
System which are deducted from the salary of employees and are credited to
individual employee's accounts pursuant to California Government Code
Section 20691.
That the contributions made by the City of Lodi to the California Public
Employees' Retirement System, aithough designated as employee
contributions, are being paid by the City of Lodi in lieu of contributions by the
employees who are members of the California Public Employees' Retirement
System.
III. That employees shall not have the option of choosing to receive the contributed
amounts directly instead of having them paid by the City of Lodi to the
California Public Employees' Retirement System.
IV. That the City of Lodi shall pay to the California Public Employees' Retirement
System the contributions designated as employee contributions from the same
source of funds as used in paying salary.
V. That the amount of the contributions designated as employee contributions and
paid by the City of Lodi to the California Public Employees' Retirement System
on behalf of an employee shall be the entire contribution required of the
employee by the California Public Employees' Retirement Law (California
Government Code Sections 20000, et seq.).
VI. That the contributions designated as employee contributions made by the City
of Lodi to the California Public Employees' Retirement System shall be treated
for all purposes' other than taxation, in the same way that member
contributions are treated by the California Public Employees' Retirement
System.
/-000.-
BOBJOHN"
Mayor
Dated: June 1, 2011
hereby certify that Resolution No. 2011-87 was passed and adopted by the City
Council of the City of Lodi in a regular meeting held June 1, 2011, by the following vote:
AYES: COUNCIL MEMBERS — Hansen, Katzakian, Mounce, Nakanishi,
and MayorJohnson
NOES: COUNCIL MEMBERS— None
ABSENT: COUNCIL MEMBERS — None
ABSTAIN: COUNCIL MEMBERS — None
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