Title
Adoption of Resolution Approving Letter of Understanding between the City of Alameda and the Alameda Fire Chiefs Association to Clarify Retention/Longevity and Management Incentive Pay Memorandum Of Understanding Language for CalPERS Compensation Compliance. (Human Resources 10025060)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
The City of Alameda (City) contracts with the California Public Employees' Retirement System (CalPERS) to provide a defined benefit plan for City retirees. When an employee from the City retires, CalPERS initiates review to determine the retiree's monthly retirement benefit which is based on years of service and pay received while employed. Upon the recent retirement of a City Fire Division Chief, CalPERS initiated a service retirement review in January 2024. Upon review of the retiree's payroll history, CalPERS determined that the Alameda Fire Chiefs Association (AFCA) Memorandum of Understanding's (MOU) language on Retention/Longevity Pay lacked clarity on compounding pay levels, reducing the retiree's final compensation, and that Management Incentive Pay (MIP) did not meet California Code of Regulations requirements. A denial letter was issued on April 23, 2024. Subsequently, the City, CalPERS, and AFCA collaborated on clarifying language, formalized in a side letter, now requiring Council adoption to allow a recalculated compensation review for the Division Chief, under the updated language. (Exhibit 1).
BACKGROUND
On January 25, 2024, the City was notified by CalPERS Compensation Compliance & Review Division of a service retirement review for a Division Chief covered under the AFCA MOU. The review period covers dates from December 1, 2020, through January 10, 2024.
To accurately complete the review, CalPERS requested clarification on several provisions within the MOU, specifically concerning the calculation method for Section 11.3 Retention/Longevity Pay and ...
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