{"body": "CityCouncil", "date": "2012-10-30", "page": 1, "text": "MINUTES OF THE SPECIAL CITY COUNCIL MEETING\nTUESDAY--OCTOBER 30, 2012--7:00 P.M.\nMayor Gilmore convened the meeting at 7:07 p.m. Councilmember deHaan led the\nPledge of Allegiance.\nROLL CALL -\nPresent:\nCouncilmembers Bonta, deHaan, Johnson, Tam and\nMayor Gilmore - 5.\nAbsent:\nNone.\nORAL COMMUNICATIONS, NON-AGENDA\n(12-512) Ken Peterson, Alameda, discussed employee compensation and the City's\nfinancial situation.\nAGENDA ITEMS\n(12-513) Receive a Report from the Pension/Other Post-Employment Benefits (OPEB)\nTask Force and Provide Direction on Next Steps.\nThe City Manager and Assistant City Manager gave a Power Point presentation.\nCouncilmember Tam inquired why the use of wind fall monies would be rejected, to\nwhich the Assistant City Manager responded she does not have direct insight; stated\nthere was hesitation to use windfall monies of the sale of Alameda Point or other City\nassets when the City has a lot of need in other areas; suggested Task Force members\npresent could give feedback.\nThe City Manager stated the community was divided about whether windfall money\nshould be used to help pay down the PERS liability; 75% were in favor of using windfall\nfunds to start paying the OPEB liability; the assumption is if PERS does not recover,\nthe City would not have independence and would be paying down an advance into a\nsystem outside City control; OPEB is completely the City's problem; OPEB is a problem\nfor the tax payers and the employees as well because if the money is not there at some\npoint there is a moral and legal obligation; no money is very real in the long term; the\nTask Force was very successful in having a consensus on what the scope of the\nproblem is and can now argue using the same numbers.\nThe following Task Force Members made brief comments: Kevin Kennedy, City\nTreasurer; Kevin Kearney, City Auditor; Jeff Bratzler, Community Member; Domenick\nWeaver, International Association of Fire Fighters Local 689 President; Gretchen Lipow,\nCommunity Member; Mike Noonan, Police Chief; and Bill Schaff, Community Member.\n***\nDuring Mr. Shaff's comments, Vice Mayor Bonta left the dais at 8:39 p.m. and returned\nSpecial Meeting\nAlameda City Council\n1\nOctober 30, 2012", "path": "CityCouncil/2012-10-30.pdf"}
{"body": "CityCouncil", "date": "2012-10-30", "page": 2, "text": "at 8:41 p.m.\nExpressed concern about non-public safety bargaining units being excluded from the\nTask Force: Bill Garvine, Management and Confidential Employees Association.\nExpressed concern about spiking: David Maxcy, Alameda.\nUrged caution in implementing the State mandate: Tony Daysog, Alameda.\nExpressed that the City needs to reduce the amount spent, growth and unfunded\nliabilities: Jane Sullwold, Alameda.\nEncouraged reading certain books: Ken Peterson, Alameda.\nStated the City tools from the State to raise revenue and self-fund the obligations: Jon\nSpangler, Alameda.\nVice Mayor Bonta inquired whether the issue was fully vetted or if an additional [Task\nForce] meeting is needed, to which the Assistant City Manager responded there has not\nbeen extensive discussion on brainstorming solutions.\nVice Mayor Bonta inquired if the Assistant City Manager was comfortable saying this\nwas the Task Force's best thinking and advice on the OPEB issue and potential\nsolutions.\nThe Assistant City Manager responded it was their best thinking at the time; stated\nhaving members reconvene to look at additional options would be a big time\ncommitment.\nVice Mayor Bonta stated the information is very valuable and it seems an additional\nmeeting is not necessary.\nThe City Manager stated the starting point is presenting options to Council; there were\ntwo labor representatives on the Task Force; having two labor representatives that had\nthe most dollars at stake made sense; most of the OPEB issue is tied up with public\nsafety; staff intends to come back to the Council in March or April with a more focused\ndiscussion just on how to go forward with OPEB; a policy change to have a two year\nbudget will come to Council in December.\nCouncilmember Johnson inquired if the Task Force agreed that there is a possible\nsituation where PERS contributions or OPEB payments could be defaulted.\nThe City Manager responded the OPEB payment is $7 million a year, which is a large\namount of money that requires planning.\nSpecial Meeting\nAlameda City Council\n2\nOctober 30, 2012", "path": "CityCouncil/2012-10-30.pdf"}
{"body": "CityCouncil", "date": "2012-10-30", "page": 3, "text": "Councilmember Johnson inquired if there was agreement about the $7 million amount,\nto which the City Manager responded in the negative; stated agreement was broad and\nwithin a range.\nCouncilmember Johnson inquired whether impacts of the Affordable Care Act was\nanalyzed.\nThe City Manager responded understanding how the Affordable Care Act will actually\nwork is difficult; stated the assumption used was that health care costs will continue to\nrise.\nCouncilmember Johnson inquired whether current employees would face changes, to\nwhich the Assistant City Manager responded the PERS recommendations have been\nsuperseded by the pension reform legislation; stated changes included additional\ncontributions from current employees; 14 Task Force members voted to ask safety\nemployees to pay more towards the employer share; OPEB solutions included:\nincreasing vesting and eligibility rules for new hires; participating in the Voluntary\nEmployees' Beneficiary Association (VEBA) or the 401(a)(h); capping benefits for\nretirees, current or future employees; working with employee bargaining groups to\nnegotiate down the liability.\nCouncilmember Tam inquired whether the Beverly Hills OPEB solution required a\nreserve.\nThe City Manager responded cash is one approach; stated another option is to finance\na large buyout with a low interest rate to securely budget; what the premiums are going\nto be in the future is not known.\nThe Human Resources Director provided an overview of the Beverly Hills program;\nstated Beverly Hills did financing; the method would help in Alameda for safety, but not\nfor miscellaneous employees; the fixed amount paid to PERS is currently $115 and will\nincrease by approximately 3% every year; safety has an agreement where an additional\namount is paid to employees upon retirement, the amount is calculated and a lump sum\nis given rather than continuing to pay, which is where there are some savings.\nThe Controller stated the Beverly Hills plan was a multifaceted plan; an actuarial\nevaluation would be done to determine what the pay would be as the value of those\nbenefits; if paying all costs up front is a significant dollar amount, which the City does\nnot have; pension bonds can be issued, but are more expensive than the sewer bonds\nthe Council recently approved; pension bond rates are between 6 and 7%, a lot of cost\nanalysis would have to be done to determine if the option makes sense for the City; one\nof the big benefits from the Beverly Hills program other than the one-time cash out for\nemployees is the defined contribution plan; with VEBA, once employees leave the City\nthere is no OPEB liability going forward.\nCouncilmember Tam inquired if the City's 1079 and 1082 plans are essentially a\nSpecial Meeting\nAlameda City Council\n3\nOctober 30, 2012", "path": "CityCouncil/2012-10-30.pdf"}
{"body": "CityCouncil", "date": "2012-10-30", "page": 4, "text": "pension obligation bond, to which the Controller responded in the negative; stated the\n1079 and 1082 plans are another pay-as-you-go plans included in the General Fund as\npart of the budget each year; the amount is going down over time because the average\nage of the pensioners is rising and people pass away.\nIn response to Councilmember deHaan's inquiry about the City's obligation, the\nController responded the City is currently paying approximately $2 million a year.\nCouncilmember deHaan inquired if the City's obligation was around $5 million in 2005\nand has dropped, to which the Controller responded in the affirmative; stated the\naverage age of the participants is 85 years old.\nCouncilmember deHaan stated every year in our budget the shortfalls are around $3 to\n$6 million; one-time windfall money has been used; sometimes staffing adjustments\nhave been made, fire stations have been closed, programs have been eliminated; the\nCity is not going to see a big recovery; that he is concerned services keep deteriorating;\nhealth benefits increase a good 14% every year; employees have not had raises.\nCouncilmember Tam stated not increasing public safety salaries since 2007 was really\na reduction in salary because the last contract included contributing more into pension;\nemployees are paying the employer's share; that she supports the findings to create a\nsustainable solution through negotiating with employee bargaining units.\nIn response to the Assistant City Manager's comments regarding different options,\nMayor Gilmore and Vice Mayor Bonta stated all the options should be placed on the\ntable to allow comparison of the full pro formas and financial analysis.\nCouncilmember Johnson inquired if the OPEB solutions were directed at both current\nand future employees, to which the Assistant City Manager responded the Task Force\ndid not discuss whether changes should apply to new or current employees.\nMayor Gilmore stated that she wanted to remind members of the public that the problem\nis long-term; tonight is the first step in reaching a solution that everyone wants; there is\na lot of work to be done researching possible solutions and figuring out how some of the\nvehicles would work; numbers have to be crunched and then there has to be discussion\nwith employee groups; there is no quick fix; every journey starts with a single step; the\nCouncil is determined to get the problem under control.\n(12-514) Recommendation to Receive Input from the Community and Provide Direction\nto Guide the City's Future Labor Negotiations with Public Safety Bargaining Groups.\nThe Human Resources Director gave a brief presentation.\nThe City Manager stated staff intends to move the process as quickly as possible and\ntry to complete negotiations in the month of November 2012; one of the most important\nreasons to not be out of contract with public safety is that the 11% PERS contribution\nSpecial Meeting\nAlameda City Council\n4\nOctober 30, 2012", "path": "CityCouncil/2012-10-30.pdf"}
{"body": "CityCouncil", "date": "2012-10-30", "page": 5, "text": "returns to 9% at the end of the contract.\nCouncilmember Johnson inquired if staff would be addressing OPEB, to which the City\nManager responded that he did not know at this point; stated the issue would come\nback for the entire City in the spring; OPEB is a difficult issue.\nCouncilmember Johnson inquired how reopeners with the bargaining groups would be\nhandled, to which the City Manager responded reopeners are a possibility and occurred\nin other cases; stated that he does not think there is a solution to OPEB that does not\ninvolve talking; the City does not want to fall out of contract or not know impacts on the\nbudget.\nCouncilmember Tam inquired if the Memorandum of Understanding (MOU) spell out the\nnew employees tiering in terms of the retirement age and averaging the highest three\nyears.\nMayor Gilmore stated in the past, issues have been in side letters which were not part\nof\nthe MOU; stated her preference is to have an MOU that somebody could pick up and\nread it and know exactly what was included and agreed to; that she would not want\nsomeone to have to go to another document to look up the new law.\nThe City Manager stated staff intends to incorporate changes into the contracts and\nextinguish side letters that are no longer relevant.\nCouncilmember deHaan inquired where the threshold is in the financial emergency of\nselling off Alameda Point and Alameda Municipal Power (AMP) assets; stated sales\nshould be off the table.\nThe City Manager responded that he did not what the courts have defined as a fiscal\nemergency; stated Alameda Point is a decided issue and cannot be sold because any\nrevenues that come from the sale of property or from lease revenues at Alameda Point\nis required to go back into the infrastructure and development of Alameda Point under\nthe agreement with the Navy.\nThe City Attorney stated that she would not opine as to what is a fiscal emergency, but\nthe assumption is that there have to be more debts than assets, then the City would\nhave to marshal assets to pay off debts.\nMayor Gilmore stated a fiscal emergency would be hard to declare with a 24% fund\nbalance reserve.\nVice Mayor Bonta inquired if letters were sent to the four public bargaining units to\nreopen contracts, to which the City Manager responded in the negative; stated new\ncontracts, which will be effective July 1, are being negotiated.\nVice Mayor Bonta inquired if there are meetings next week, to which City Manager\nSpecial Meeting\nAlameda City Council\n5\nOctober 30, 2012", "path": "CityCouncil/2012-10-30.pdf"}
{"body": "CityCouncil", "date": "2012-10-30", "page": 6, "text": "responded in the affirmative.\nVice Mayor Bonta inquired if all bargaining units are open to moving forward, to which\nthe City Manager responded informal responses were received from both the\nInternational Association of Fire Fighters (IAFF) and the Alameda Police Officers\nAssociation (APOA).\nCouncilmember deHaan stated following San Jose's open negotiation model was\ndiscussed in the past; stated he would like to see more transparency.\nCouncilmember Tam stated that ensuring openness in the discussions is a laudable\ngoal; stated the City of Alameda, the Teacher's Union and the Board of Education\nnegotiated in the open and some proposals were not fully vetted or researched,\npositions became so intractable that people ended up feeling very disenfranchised.\n*\nCouncilmember Tam left the dais at 9:47 p.m. and returned at 9:49 p.m.\n*\nUrged a macro approach be taken: Jane Sullwold, Alameda.\nUrged principles be developed using the previous discussion: Tony Daysog, Alameda.\nUrged current staffing levels be maintained: Jon Spangler, Alameda.\nMayor Gilmore stated a former Fire Chief gave a presentation on response times;\nrequested the City Clerk post the information on the website.\nThe City Manager stated all the external studies that have been done about the Fire\nDepartment have been up on the website since July.\nCouncilmember Tam clarified Mayor Gilmore was referring to a Council presentation\ncomparing response times and discussing Fire Department protocol; stated the National\nFire Protection Association has standards on why an ambulance is sent along with a\ntruck and how many paramedics are on trucks.\nCouncilmember Johnson inquired if the Council would receive a briefing on the opening\nproposal.\nThe City Manager responded that he would get proposals from labor first and come\nback to Council in Closed Session.\nCouncilmember Tam stated the staff direction outlined is consistent with suggestions\nfrom the Pension Task Force and the Council.\nMayor Gilmore stated the Council received public input tonight and the City Manager\nSpecial Meeting\nAlameda City Council\n6\nOctober 30, 2012", "path": "CityCouncil/2012-10-30.pdf"}
{"body": "CityCouncil", "date": "2012-10-30", "page": 7, "text": "intends to start meeting with the bargaining units next week; last year, there was a\nprimer on labor negotiations and how public input has to be upfront.\nCouncilmember deHaan inquired if input from the community is closed.\nThe City Manager responded the City has to be careful not to have regressive\nbargaining once the ground rules and areas of discussion are established; stated\nanyone can email the City Manager's office with suggestions or input.\nVice Mayor Bonta stated labor negotiations Closed Sessions are noticed and public\ninput is received prior to adjourning to closed session.\nThe City Manger stated input is not closed but new issues are difficult to introduce after\nthe outset.\nCouncilmember Johnson inquired whether each side establishes ground rules\nseparately, to which the City Manager responded ground rules determine the point at\nwhich issues can be talked about publicly and is a process.\nThe Human Resource Director stated one of the rules usually sets the last day new\nproposals can be submitted.\nThe City Manager stated best practices are to put everything on the table from the\nbeginning so there are no surprises.\nCITY MANAGER COMMUNICATIONS\nNone.\nCOUNCIL COMMUNICATIONS\n(12-515) Councilmember deHaan stated he attended a Restoration Advisory Board\n(RAB) meeting; the Navy is moving forward with the Building 5 and 5A remediation; the\nnext RAB meeting has been moved to November 13th.\nThe City Manager noted the City filed a technical letter expressing concerns about the\nremediation program that has been proposed.\n(12-516) Councilmember Tam announced that the City held an Urban Shield.\n(12-517) Councilmember deHaan stated that he attended a Oakland Noise Forum\nmeeting; next year will be a very active year for the Oakland Airport; runways will be\nmodified.\nADJOURNMENT\nSpecial Meeting\nAlameda City Council\n7\nOctober 30, 2012", "path": "CityCouncil/2012-10-30.pdf"}
{"body": "CityCouncil", "date": "2012-10-30", "page": 8, "text": "There being no further business, Mayor Gilmore adjourned the meeting at 10:26 p.m.\nRespectfully submitted,\nLara Weisiger\nCity Clerk\nThe agenda for this meeting was posted in accordance with the Sunshine Ordinance.\nSpecial Meeting\nAlameda City Council\n8\nOctober 30, 2012", "path": "CityCouncil/2012-10-30.pdf"}