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A. RESOLUTION NO. 2017-059 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING AN AMENDMENT (LETTER OF UNDERSTANDING) TO THE 2014-2017 MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF CHULA VISTA AND LOCAL 2180 INTERNATIONAL ASSOCIATION OF FIRE FIGHTERS AFL-CIO (IAFF)
B. RESOLUTION NO. 2017-060 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA AMENDING EMPLOYER PAID MEMBER CONTRIBUTIONS FOR TIER 1 EMPLOYEES IN CLASSIFICATIONS REPRESENTED BY LOCAL 2180 INTERNATIONAL ASSOCIATION OF FIRE FIGHTERS AFL-CIO (IAFF) EFFECTIVE MARCH 15, 2019
C. RESOLUTION NO. 2017-061 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING CESSATION OF PAYMENT, ON EMPLOYER SIDE, FOR OPTIONAL BENEFITS BY TIER 1 EMPLOYEES IN CLASSIFICATIONS REPRESENTED BY LOCAL 2180 INTERNATIONAL ASSOCIATION OF FIRE FIGHTERS AFL-CIO (IAFF) AS A RESULT OF TERMINATION OF EMPLOYER PAID MEMBER CONTRIBUTIONS FOR SAID EMPLOYEES EFFECTIVE MARCH 15, 2019
D. RESOLUTION NO. 2017-062 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING THE REVISED FISCAL YEAR 2016-2017 COMPENSATION SCHEDULE EFFECTIVE APRIL 28, 2017 AS REQUIRED BY CALIFORNIA CODE OF REGULATIONS, TITLE 2, SECTION 570.5
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RECOMMENDED ACTION
Recommended Action
Council adopt the resolutions.
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SUMMARY
In 2014, negotiating teams representing the City of Chula Vista and Local 2180 International Association of Fire Fighters AFL-CIO (IAFF) worked collaboratively toward the development of a mutually beneficial Memorandum of Understanding (MOU), which the parties entered into for the time period of December 2, 2014 to June 30, 2017. The City and IAFF recently engaged in formal good faith wage reopener negotiations (as required pursuant to MOU Article 2.01.I.D [Reopener]) and also engaged in informal good faith discussions to extend and amend the MOU. An agreement was subsequently reached on the term of the MOU, salary adjustments and benefits, the elimination of Employer Paid Member Contributions (EPMC) for Tier 1 employees (unless otherwise elected by IAFF to continue EPMC for an additional specified period by paying the full cost for the benefit), and Affordable Care Act (ACA) reopener language.
ENVIRONMENTAL REVIEW
The Development Services Director has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a “Project” as defined under Section 15378(b)(2) of the State CEQA Guidelines because it is a personnel related action; therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines the activity is not subject to CEQA. Thus, no environmental review is necessary.
Environmental Notice
Environmental Notice
The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
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BOARD/COMMISSION RECOMMENDATION
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DISCUSSION
In 2014, negotiating teams representing the City of Chula Vista and Local 2180 International Association of Fire Fighters AFL-CIO (IAFF) worked collaboratively toward the development of a mutually beneficial Memorandum of Understanding (MOU), which the parties entered into for the time period of December 2, 2014 to June 30, 2017. The City and IAFF recently engaged in formal good faith wage reopener negotiations (as required pursuant to MOU Article 2.01.I.D [Reopener]) and also engaged in informal good faith discussions to extend and amend the MOU. An agreement was subsequently reached on the term of the MOU, salary adjustments and benefits, the elimination of Employer Paid Member Contributions (EPMC) for Tier 1 employees (unless otherwise elected by IAFF to continue EPMC for an additional specified period by paying the full cost for the benefit), and Affordable Care Act (ACA) reopener language.
Below is a summary of the agreement reached:
1. Term and Effect: Extend the current expiration date of June 30, 2017 to December 31, 2019.
2. Salary Adjustments:
• 2.5% in the first full pay period after ratification by IAFF and approval by the City Council via resolution in open session
• 2% in the first full pay period of January 2018
• 2% in the first full pay period of January 2019
3. Education Incentive Pay: For represented employees hired on or after April 25, 2017, number of units required for incentive pay increases from 30 to 60 units of fire science courses or any administrative or technical (i.e. computer, writing) courses in support of the fire service.
4. Field Training Officer Pay: Five percent (5%) additional compensation to base pay for IAFF represented employees in the Firefighter/Paramedic classification who are actually engaged as Field Training Officers (FTOs) and training Chula Vista Paramedic trainees assigned to a fire company.
5. Medical:
• Employees hired on or after April 25, 2017 that enroll in any non-Kaiser plan are responsible to pay any amount greater than the cost of the Kaiser Plan.
• Effective December 31, 2019, all employees enrolled in any non-Kaiser plan are responsible to pay any amount greater than the cost of the Kaiser Plan.
6. Elimination of EPMC for Tier 1 employees after the first full pay period of March 2019. However, IAFF may elect to continue EPMC for an additional specified period by paying the full cost for the benefit as determined by the City’s Actuary.
7. Incorporate reopener language regarding the Affordable Care Act (ACA)
The agreement was ratified by a majority of the IAFF membership on April 24, 2017.
Termination of Employer Paid-Member Contributions for Tier 1 Employees
The City presently pays 9%, on employee side, for retirement benefits for Tier 1 IAFF represented employees resulting in Employer Paid Member Contributions (“EPMC”) and IAFF represented employees presently pay, on the employer side, 9% for CalPERS optional benefits.
Pursuant to Government Code section 20691, effective March 15, 2019, the City will cease to pay 9%, on the employee side, for retirement benefits for Tier 1 employees represented by IAFF resulting in 9% payment by Tier 1 employees represented by IAFF, on the employee side, for employee contributions for retirement benefits (which they had not been required to pay) and the cessation of EPMC.
However, IAFF may elect to continue EPMC for Tier 1 employees for an additional specified period by paying the full cost for the benefit as determined by the City’s Actuary. This cost to maintain the benefit will be paid solely by employees. IAFF must notify the City and enter into a Letter of Understanding no later than February 15, 2019 to maintain this benefit. The EPMC shall thereafter continue for a mutually agreed upon term. Thereafter, its removal shall be subject to the meet and confer requirements of the MMBA, including impasse requirements, to the extent required by the MMBA.
Compensation Schedule
California Code of Regulations, Title 2, Section 570.5 requires that, for purposes of determining a retiring employee's pension allowance, the pay rate be limited to the amount listed on a pay schedule that meets certain requirements and be approved by the governing body in accordance with the requirements of the applicable public meeting laws. The most recent Fiscal Year 2016-2017 Compensation Schedule ("Compensation Schedule") was revised and adopted by the City Council on March 7, 2017.
Approval of Resolution E will approve the revised Compensation Schedule, effective April 28, 2017, in compliance with California Code of Regulations, Title 2, Section 570.5, to reflect the salary adjustment for positions represented by IAFF and those unclassified hourly position titles that match an IAFF bargaining unit classification title as provided for in the Fiscal Year 2016-2017 Compensation Summary for Unrepresented Employees.
DECISION-MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined that it is not site specific and consequently, the 500-foot rule found in California Code of Regulations section 18704.2(a)(1), is not applicable to this decision. Staff is not independently aware, and has not been informed by any Council member, of any other fact that may constitute a basis for a decision maker conflict of interest in this matter.
LINK TO STRATEGIC GOALS
The City’s Strategic Plan has five major goals: Operational Excellence, Economic Vitality, Healthy Community, Strong and Secure Neighborhoods and a Connected Community. These changes support City Initiative 1.2.3 Retain and attract quality employees under the Operational Excellence goal. Employee compensation is instrumental to recruiting and retaining quality employees.
CURRENT YEAR FISCAL IMPACT
The proposed salary adjustments have an estimated net impact of $115,889 in the current fiscal year. Staff is not requesting an appropriation at this time. Staff is currently developing the fiscal year 2016-17 third quarter projections and anticipates that the impact may be mitigated through overall General Fund savings. If savings or unanticipated revenues are not identified, there will a negative impact to the overall general fund reserves.
ONGOING FISCAL IMPACT
Staff is currently working on the development of the fiscal year 2018 proposed budget. The estimated baseline budget for salary and benefits associated with IAFF positions is anticipated to total $18.5 million in the General Fund. The proposed salary and benefit changes for IAFF represented employees would increase the City’s annual ongoing operating costs in fiscal year 2018 by an estimated $0.7 million. The fiscal impacts related to future salary increases scheduled for 2019 and 2020 will be incorporated in the budgets for those fiscal years. The anticipated impacts are noted below.
The City may incur additional fiscal liability if the IAFF elects to continue EPMC benefits at their cost. The actual liability is unknown at this time and may depend on several factors ultimately determined by CalPERS investment performance and Board decisions on future discount rates.
ATTACHMENTS
(1) Amendment (Letter of Understanding) to the 2014-2017 MOU Between the City of Chula Vista and the Local 2180 International Association of Fire Fighters AFL-CIO (IAFF)
(2) Revised Fiscal Year 2016-2017 Compensation Schedule Effective April 28, 2017
Staff Contact: Courtney Chase