The URL can be used to link to this page

Home My WebLink About _ 4.15(b)--RPOA PARS Contract Amendment � � �' � � � � � � ' � �' � � ' � ` CITY OF REDDING REPORT TO THE CITY COUNCIL MEETING DATE: December 3, 2024 FROM: Kari Kibler, Personnel ITEIVI NO. 4.15(b) Director ***APPROVED BY*** � �, � � � �� ` i�]�r,Persr�nnel I�irectc�r ��f2?i2t?'�� rS' �p�ir�,C�i �� ° 1 l,'26,{'2{}? kkibler@cityofredding.org btippin@cityofredding.org SUBJECT: 4.15(b)--Resolution terminating the Public Agency Retirement Services (PARS) Defined Contribution Retirement Enhancement Plan for Redding Peace Officers Association (RPOA Recommendation Authorize and approve the following: (1) Adopt Resolution terminating the Public Agency Retirement Services (PARS) Defined Contribution Retirement Enhancement Plan for Redding Peace Officers Association; and (2) Authorize the Personnel Director to complete the Notice of Termination informing PARS and U.S.Bank of the termination as Plan Administrator. Fiscal Impact There is no fiscal impact associated with this action. Redding Peace Officers Association (RPOA) requested the creation of the Public Agency Retirement Services (PARS) 401(a) deferred compensation plan in 2021; however, in 2023, this benefit was bargained away at the request of the unit and ratified by City Council (Council). This benefit was paid in totality by the enrolled RPOA members. Alte�natzve Action The Council could decline to approve the resolution. This is not recommended as the Council previously agreed to terminate the plan during 2023 negotiations with RPOA and PARS requires the City to terminate the plan via resolution of the Council. Background/Analysis In 2021, the City and RPOA agreed to the creation of a PARS 401(a) deferred compensation plan and to have employees in Tier 3 of the Ca1PERS retirement benefit contribute the difference between the Ca1PERS required contribution amount and 50 percent of the normal cost of retirement into the plan. The City was responsible to open and manage the account, but did not make any contributions into the plan. Report to Redding City Council November 26,2024 Re: 4.15(b)--RPOA PARS ContractAmendment Page 2 In 2023, RPOA and the City agreed to terminate the PARS 401(a) deferred compensation plan during negotiations. The last employee contributions to the plan occurred through payroll on October 15, 2023. In order to officially terminate the plan, PARS requires the City Council to adopt a resolution terminating the plan as we11 as official written notice from the Plan Administrator, the City's Personnel Director, informing PARS and U.S. Bank of the termination. If the City Council takes the recommended actions, the Personnel Director will execute the PARS amendment ceasing the employee contributions pursuant to the agreement reached during 2023 negotiations and provide official written notice to PARS and U.S. Bank of the intent to terminate the agreement. Once the plan is terminated, PARS will contact the affected employees and provide options for either receiving an immediate distribution of their aceount balance minus any taxes and penalties or rolling the funds into another qualifying account of their choice. RPOA supports the termination of the plan as it aligns with the agreement reached during 2023 negotiations. Envi�^onmental Review This is not a project defined under the California Environmental Quality Act, and no further action is required. Council Prior�ity/City ManageN Goals • Government of the 21 St Century — `Be relevant and proactive to the opportunities and challenges of today's residents and workforce. Anticipate the future to make better decisions today." Attachments ^Resolution Plan Termination Draft Notice of Termination PARS EE Contribution Ceasation Amendment RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDDING AUTHORIZING THE TERMINATION OF THE CITY OF REDDING PUBLIC AGENCY RETIREMENT SERVICES (PARS)DEFINED CONTRIBUTION RETIREMENT ENAANCEMENT PLAN WHEREAS, the City of Redding (the `Bmployer") previously adopted the City of Redding PARS De�ned Contribution Retirement Enhancement Plan (the "Plan"), amended and restated effective June 1,2021; and WHEREAS, the Employer has decided that it is in the best interest of the Employer and the Plan to terminate the Plan, and WHEREAS, as of the date of Plan termination, all amounts credited to the Account of any affected Participant shall become one hundred percent(100%)vested; and WHEREAS, ali P1an assets shall be distributed to eligible Participants, as soon as administratively feasible following the Plan termination; and WHEREAS,the Plan shall be amended to include recent legislation and regulations applicable to qualified 401(a}defined contribution plans through the date of Plan termination; and WHEREAS, in accordance with Section 7.3 of the Plan, the Employer has the right to amend and terminate the Plan. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF TFIE CITY OF REDDING: (1) The Plan is hereby terminated effective December 3,2024. (2) As of the effective date of the Plan termination, a11 amounts credited to the Account of any affected Participant shall become one h�undred percent(100%)vested. (3) All Plan assets shall be distributed to Participants having an undistributed balance in the Plan, as soon as administratively feasible following the Plan termination. (4) The Personnel Director is hereby authorized to execute Plan amendments and documents, if any, and to do any and a11 acts that may be necessary in connection with the termination of the P1an. (5) Once a11 Plan assets have been distributed, PARS is removed as Trust Administrator, U.S. Bank N.A. is removed as Trustee, and John Hancock Retirement Services is removed as Custodian/Recordkeeper, and any and all agreements associated with the Plan shall be terminated. I, Sharlene Ti�ton, Clerk of the City of Redding, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the council of said City held on the 3ra day of December, 2024 by the following vote: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCIL lYIEMBERS: SHARLENE TIPTON, CITY CLERK � �` �' �- �IT'"� � � I _� �� C�y�r�s� A��r��, ��c�dir�g� �� 96�C�� ' -- PC� �C��C 49��7�, ��t�di�tt�> �A ��i�49-6C?71 � � � . �� `� �ityr�fr+� dir��. �u .� �.� , r. December 4, 2024 Mr. Daniel Johnson President Public Agency Retirement Services, PARS 4350 Von Karman Avenue,Suite 100 Newport Beach, CA 92660 Ms.Susan M. Hughes-Hill Vice President/Regional Client Services Manager U.S. Bank Institutional Trust&Custody 18300 Von Karman Avenue,Suite 500 Irvine,CA 92612 RE: City of Redding-Notice of the intent to Terminate the City of Redding PARS D�fined Cantribution Retirement Enhancement Plan Dear Mr.Johnson and Ms.Hughes-Hill: This letter sha11 serve as notification of the City of Redding's ("Emplt�yer") intent to terminate the City of Redding PARS Defined Cantribution Retirement Enhancement Plan("P1an")adopted effective October 2, 2001. The Empioyer has decided that it is in the best interests of the Employer and the Plan to terminate the Plan and does not intend ta u�e the Plan in the future. In accordance with IRS rules and regulatio�s,the abtrve-referenced Plan is current for all legislation applicable to governrnental defined contribution plans through the date of plan termination. Once all Plan assets have been;distributed,PARS is removed as Trust Administrator,U.S. Bank N.A.is removed as Trustee,and John Hancock Retirement Services is removed as Custodian/Recordkeeper, and any and all agreements assaciated with the Plan shall be terminated. As Plan Administrator, I,am authorized pursuant to Section 3.4 of the Trust Agreement and Section 7.3 of the Plan Document to carry out the tasks necessary to terminate the Employer's Plan. PARS and U.S. Bank may rely c�n my authority and the statements in this letter with respect to the termination of the Plan. Sincerely, Kari Kibler Personnel Director kkibler@cityofredding.org (530) 225-4509 AMENDMENT TO THE CITY OF REDDING PUBLIC AGENCY RETIREMENT SERVICES(PARS) RETIREMENT ENHANCEMENT PLAN WHEREAS, the City of Redding (the "Employer"} has adopted the City of Redding Public Agency Retirement Services (PARS) Retirement Enhancement Plan, amended, and restated effective lune 1, 2021 (the "Plan"); and WHEREAS, the Employer has reserved the right to amend the Plan from time to time in accordance with Section 7.3 of the Plan; and WHEREAS,the Employer and the Redding Peace Officers Association ("RPOA") Employee group have entered into agreement amending the terms and conditions of the contract and memorandum of understanding to no longer require Employee contributions to be made to the Plan;and NOW THEREFORE, BE IT RESO�VED, the Plan is hereby amended effective December 3, 2024 as follows: 1. Article II,Section 2.2,Amount of Employee Contributions, is hereby amended in its entirety to read: 2.2 Amount of Employee Contributions There is hereby created and established and shall be maintained by the Plan Administrator the Employee Contribution Account. Effective in the pay period beginning on June 13, 2021, for each day that an Employee remains a Participant under this Plan,the Employee will make a mandatory contribution of one-quarter of one percent(OZ5%) of Compensation to the Plan. Such amount shall be contributed to the Plan through bi-weekly payroll deductions. Effective in the pay period beginning on September 5, 2021,for each day that an Employee remains a Participant under this Plan, the Employee will make a mandatory contribution of two and one- quarter percent (2.25%) of Compensation to the Plan. Such amount shall be contributed to the Plan through bi-weekly payroll deductions. Effective in the pay period beginning on December 11, 2022,for each day that an Employee remains a Participant under this Plan, the Employee will make a mandatory contribution of four and one- quarter percent (4.25%) of Compensation to the Plan. Such amount shall be contributed to the Plan through bi-weekly payroll deductions. Effective in the pay period beginning on July 1, 2023, for each day that an Employee remains a Participant under this Plan, the Employee will make a mandatory contribution of three percent (3.00%) of Compensation to the Plan. Such amount shall be contributed to the Plan through bi- weekly payroll deductions. Such contributions shall be made before the close of the Plan Year, or as soon as administratively practicable thereafter, and are subject to the limitation provisions of Section 2.7 of the Plan. Employee contribution amounts shall be credited to the Employee Contribution Account and are subject to change at the discretion of the Employer. Effective October 15,2023,all mandatory Employee contributions shall cease. 2. All other terms and provisions of the Plan shall remain in full force and effect. IN WITNESS WHEREOF,this Amendment is hereby adopted as of the date executed below. City of Redding By: Kari Kibler AMENDMENT TO THE CITY OF REDDING PUBLIC AGENCY RETIREMENT SERVICES(PARS) RETIREMENT ENHANCEMENT PLAN Its: Personne) Director Dated: