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2010-27537 Reso RESOLUTION NO. 2010 -27537 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, RATIFYING A THREE (3) YEAR LABOR AGREEMENT BETWEEN THE CITY OF MIAMI BEACH AND THE COMMUNICATIONS WORKERS OF AMERICA/LOCAL NO. 3178 (CWA), FOR THE PERIOD FROM OCTOBER 1, 2009 THROUGH SEPTEMBER 30, 2012; AND AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE THE AGREEMENT. WHEREAS, the City Manager is hereby submitting to the Mayor and City Commission the attached Labor Agreement, negotiated between the City and the Communications Workers of America /Local no. 3178 (CWA), for the employees covered by said Agreement for the time period of October 1, 2009 through September 30, 2012; and WHEREAS, the previous Labor Agreement was for a three year period from October 1, 2006, through September 30, 2009; and WHEREAS, on September 30, 2009 the Collective Bargaining Agreement (Agreement) for CWA expired; and WHEREAS, the CWA membership held a ratification vote on the proposed Labor Agreement (attached) on September 30, 2010. The final vote was 207 in favor and 113 opposed (65 percent ( %) of the voting members were in favor of the proposed Agreement); and NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, hereby approving and authorizing the Administration to ratify the attached three (3) year labor Agreement with the CWA bargaining unit for the time period covering October 1, 2009 through September 30, 2012. PASSED AND ADOPTED THIS cr/4 DAY OF (n(, (X2010. ATTEST: -0 (Ak.A, 1 ( Afizirt . , CITY CLERK AY T:\AGENDA \2010 \October 27 \Regular \CWA 2010 -2013 Labor Agreement Reso.docx APPROVED AS TO FORM & LANCRIAGE & FOR EXECUtION id/5 4r COMMISSION ITEM SUMMARY Condensed Title: A Resolution Of The Mayor And City Commission Of The City Of Miami Beach, Florida, Ratifying A Three (3) Year Labor Agreement Between The City Of Miami Beach And The Communications Workers Of America, Local 3178 (CWA), For The Period From October 1, 2009 Through September 30, 2012; And Authorizing The Mayor And City Clerk To Execute The Agreement. Key Intended Outcome Supported: Control costs of payroll including salary and fringes/ minimize taxes/ ensure expenditure trends are sustainable over the long term. Supporting Data (Surveys, Environmental Scan, etc N/A Issue: Should the City Commission adopt the resolution to ratify a three (3) year successor labor Agreement between the City and the CWA bargaining unit? Item Summary/Recommendation: After nearly 20 negotiation sessions, the City and CWA successfully concluded negotiations and reached a tentative three (3) year labor Agreement covering the time period of October 1, 2009 through September 30, 2012. These employee concessions include a zero Cost of Living Increase for 30 months, a freeze on merits, a 3.5% wage reduction for 12 months, (or an additional 2% employee pension contribution if the pension board actuary and the State of Florida Division of Retirement agree to recognize the value of pension changes), the elimination of certain incentive pays, adherence to FLSA guidelines when compensating for overtime and a reduction in Holiday pay compensation. In addition, CWA has also agreed to pension plan changes for current and future CWA employees. For current employees, the Final Average Monthly Earnings (FAME) calculation will be adjusted from the two (2) highest years to the five (5) highest years. In exchange for the employee concessions, the City has agreed that all CWA bargaining unit members will be guaranteed a job with the City for the time period of October 1, 2010 through September 30, 2012. During this time period, no employee covered under the CWA Bargaining Unit shall be separated from the City for reasons other than disciplinary, voluntary separation or whose position has been reclassified due to changes in job duties. The value for the proposed successor Agreement is estimated to generate a savings of approximately $1.87M for FY2010/2011 and over $4.28 million through the full term of the Agreement. In addition, these concessions will yield additional, recurring, long term savings in future fiscal years. Advisory Board Recommendation: Financial Information: " Source of Amount Account Funds: 1 : - FY2009/2010 N/A Status Quo 2 FY2010/2011 Freeze on Merits, 3.5% Wage Concession and /or 2% employee pension ($1,870,000) contribution, Elimination of Incentive Pays, Change of FAME. 3 ," FY2011 /2012 Merit Freeze; Elimination of Incentive Pays; Change of FAME; 3% ($2,409,745) COLA April 2012; Additional 2% employee pension contribution; Pension Changes for Future Employees. OBPI Total ($4,279,745) Financial Impact Summary: The savings for FY 2010/2011 total $1.87M. This represents a per person impact of $4,400 to each member of the CWA bargaining unit for this time period. The total savings for the three (3) year agreement total $4.28M. In addition, these concessions will yield additional, recurring, long term savings in future fiscal years. City Clerk's Office Legislative Tracking: Ramiro Inguanzo, Human Resources Director Si • n-Offs: Department Director -. Assistant City Manager City anager . . • =" l iro In . Fern. i - � _A „dez � jlr• M o zalez /11111111 T:\AGE DA \2010 \Octi •er 27 \Regul 1 \CWA 2009- 12 Labor Agreement Summary.doc • AGENDA ITEM R 7 B [SATE 1 -1-7- ( D if-SI MIAM!BEACH City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamibeachfl.gov COMMISSION MEMORANDUM TO: M. •r Matti Herrera Bower and M ers of the City Commission FROM: • r• a M. G zalez, City Manager DATE: October 27, 2010 SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, RATIFYING A THREE (3) YEAR LABOR AGREEMENT BETWEEN THE CITY OF MIAMI BEACH AND THE COMMUNICATIONS WORKERS OF AMERICA, LOCAL 3178 (CWA), FOR THE PERIOD FROM OCTOBER 1, 2009 THROUGH SEPTEMBER 30, 2012; AND AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE THE AGREEMENT. ADMINISTRATIVE RECOMMENDATION Adopt the Resolution. BACKGROUND During the July 2009 Finance and Citywide Projects Committee (Committee) budget preparation meetings for the FY2009/2010 Budget, the Committee requested that all City of Miami Beach employees make certain financial concessions to help address the challenges being faced during the FY2009/2010 budget cycle and beyond. The Committee requested the Administration to budget for specific employee givebacks for FY2009/2010, which would in turn effectuate a cost savings of approximately $4.3M (approximately $3.5M savings attributed to the General Fund and $800,000 from various enterprise funds). Furthermore, in 2010 the City Commission directed the Administration to secure and budget for an additional $11M in savings attributed to employee givebacks for FY2010/2011. Therefore, the total amount of employee givebacks for both the FY2009/2010 and FY2010/2011 is $15.3M. The City currently has a total of seven (7) salary groups who represent employees; (1) the American Federation of State, County and Municipal Employees, Local 1554 (AFSCME); (2) the Communications Workers of America, Local 3178 (CWA); (3) the Government Supervisors Association of Florida /OPEIU, Local 100 (GSA); (4) the Fraternal Order of Police, William Nichols Lodge No. 8 (FOP); (5) the International Association of Fire Fighters, Locals 1510 (IAFF) (6) Unclassified employees; and (7) "Others" (Classified employees not represented by a bargaining unit). Based upon the direction received from the City Commission, the $15.3M savings in employee concessions for FY2009/2010 and FY2010/2011 combined was tb be divided up proportionately amongst each of the seven (7) salary groups based on total budgeted payroll and a proportionate share of the preliminary FY2010/2011 City's Annual Required Contributions to both of City Commission Memorandum October 27, 2010 CWA 2009 -2012 Ratified Collective Bargaining Agreement Page2of9 the City's pension plans. In addition, the City Commission also directed the Administration to negotiate with the respective unions for pension adjustment and changes to both of the City's pension plans (the Miami Beach Fire Fighters and Police Officers (Fire and Police) Pension Plan and the Miami Beach Employees' Retirement Plan (MBERP)), in order to obtain recurring savings for future years in each of the pension plans. ANALYSIS On September 30, 2009, the previous three (3) year Collective Bargaining Agreement (Agreement) for CWA (covering the period of October 1, 2006 through September 30, 2009) expired. In anticipation of the contract expiring, negotiators for the City and the CWA began meeting in June 2009 to negotiate for a successor three (3) year Agreement in June 2009. After nearly twenty (20) negotiation sessions, in September 24, 2010 the City and the CWA successfully concluded negotiations and reached a tentative three (3) year labor Agreement covering the time period of October 1, 2009 through September 30, 2012. Based on the direction from the City Commission, the CWA's portion towards the FY2009/2010 and FY2010/2011 employee portion of the $15.3M totaled approximately $2M. Based on the terms and conditions tentatively agreed to between the City and CWA, the City estimates that the CWA meets their portion for FY2009/2010 and FY2010/2011 combined. This represents a per employee impact of $4,400 to each member of the CWA bargaining unit and represents 8.32% of CWA payroll. In addition, the value for the proposed successor Agreement is estimated to generate a savings of approximately $4.28M for the entire three (3) year Agreement. More importantly, these negotiated amendments represent long -term, recurring savings for future fiscal years. The CWA membership scheduled a ratification vote among its members for the proposed Agreement on Friday, September 30, 2010. The final vote was 207 in favor and 113 opposed (65 percent of the voting members voted in favor of the proposed Agreement). The following is a summary of the proposed Agreement with the CWA: Year One (1) of the Agreement (October 1, 2009 through September 30, 2010) — Status Quo • For the time period covering October 1, 2009 through September 30, 2010, the City and the Union agreed to maintain all provisions of the previous Agreement (2006 — 2009) as status quo. Therefore, all CWA employees who were eligible to receive merit or step increases during the time period covering October 1, 2009 through September 30, 2010, received them. However, no CWA employee received a Cost of Living Adjustment for FY2009/2010, since the previous Agreement did not specifically provide for one. Wages • Cost of Living Adjustments (COLA) - Effective October 1, 2009 through March 31, 2012, (30 months) there will be no across - the -board wage increases (COLA) for this two (2) year period for any CWA bargaining unit members. Gabriel, Roeder and Smith (GRS), the actuary for the MBERP, has estimated that the City's Annual Required Contribution (ARC) due on October 1, 2011 would be reduced by approximately $300,000 if no COLA were provided to any active plan participants (all general employees in the AFSCME, CWA, GSA, Unclassified and "Others" salary groups) for FY2009/2010. Furthermore, an additional $600,000 savings will be realized to the City's ARC due on October 1, 2012 if no COLA were provided to any active plan participants (all general employees in the AFSCME, CWA, GSA, Unclassified and "Others" salary groups) in FY2010/2011. The zero COLA for just the CWA members will City Commission Memorandum October 27, 2010 CWA 2009 -2012 Ratified Collective Bargaining Agreement Page 3 of 9 generate a savings of approximately $84,000 to the City's ARC payment due on October 1, 2011, and approximately an additional $168,000 savings on the City's ARC payment due on October 1, 2012. The total savings to the City's ARC for the three (3) year period for just CWA members is approximately $252,000. Effective with the first full pay period ending in April 2012, all active CWA Bargaining Unit members will receive an across - the -board COLA of three ercent 3% . In addition, effective ( ) ve with the three percent (3 %) COLA, the minimum and maximum pay rates of the salary ranges for all job classifications covered by the CWA bargaining unit will be adjusted accordingly. The City estimates a cost impact from this COLA for CWA employees of approximately $386,000 to be applied towards the City's FY2011/2012 operating budget. • Pay for Performance Plan - Effective October 1, 2010, the classifications of Lifeguard I, Lifeguard II and Lifeguard Lieutenants were removed from the City's Automatic Step Pay Plan System and placed in the City's Pay for Performance Classification and Pay System. In doing so, new salary grades were created for each of these classifications, however the salary ranges remain consistent with the corresponding salary ranges for each of the three (3) respective classifications that were already in place under the Step Pay Plan System. With this change, all CWA employees are now in the City's Pay for Performance plan effective October 1, 2010. • Performance Merit Increases - Effective October 1, 2010, merit salary increases will be suspended for any eligible CWA bargaining unit member. • Additional Wage Concession - Pursuant to the proposed Agreement, the CWA has agreed to a temporary, twelve (12) month wage concession for all CWA bargaining unit members. Effective upon ratification, all CWA members will receive a three and one half percent (3.5 %) wage reduction, calculated on base pay, for a twelve (12) month period. However, based on the terms of the Agreement, should the City receive confirmation, in writing, from the MBERP actuary and from the State of Florida Division of Retirement that the City will recognize at least a $1,000,050 savings from the pension adjustments agreed to by the CWA, and that these savings could be applied retroactively to the City's Annual Required Contribution (ARC) due on October 1, 2010, then effective November 27, 2010, the three and one half percent (3.5 %) temporary wage reduction will be replaced with a two percent (2 %) increase towards the employee's pension contribution for all CWA members who participate in MBERP. The value of the wage concessions (COLA, freeze on performance merits and a 3.5% wage reduction for twelve (12) months) made by CWA total approximately $1.73M over the term of the three (3) year Agreement. Approximately $330,000 will be realized during FY2010/2011 and an additional estimated $1,010,000 will be realized during FY2011/2012, primarily due to the compounding effect of no merits in FY2010/2011 and FY2011/2012. The City will spend approximately $386,000 in FY2011/2012 for the three percent (3 %) COLA effective the first full pay period in April 2012. The twelve (12) month temporary wage concession will generate a savings of approximately $776,000. However, should the City receive confirmation, in writing, from the MBERP actuary and the State of Florida Division of Retirement that the pension savings agreed to by the CWA can be applied retroactively towards the City's ARC payable on October 1, 2010, then the three and one half percent (3.5 %) wage reduction will cease on November 27, 2010 and will be replaced with the additional two percent (2 %) employee pension contribution. The prorated value for the three and one half percent (3.5 %) I City Commission Memorandum October 27, 2010 CWA 2009 -2012 Ratified Collective Bargaining Agreement Page 4 of 9 wage reduction for the one (1) month time period (October 27, 2010 through November 26, 2010) will be approximately $65,900. In addition, these concessions will yield additional, recurring, long -term savings in future fiscal years. Pension • Employee Pension Contribution — As stated above, the City and the CWA have agreed to begin an additional two percent (2 %) employee pension contribution for their members who in MBERP. The effective date for implementing the additional two percent 2 0 participate P g p ( ��) employee pension contribution is subject to the City receiving written confirmation from the MBERP actuary and the State of Florida Division of Retirement that the estimated savings of approximately $1 M attributed from the pension plan changes for CWA members who participate in MBERP, can be retroactively applied towards the City's ARC due on October 1, 2010. If these pension savings can be confirmed in writing, the three and one half percent (3.5 %) temporary wage concession would cease and the additional two percent (2 %) employee pension contribution would begin for all CWA bargaining unit members who participate in MBERP. When the two percent (2 %) increase to the employee's pension contribution becomes effective, this would mean an increase from ten percent (10 %) to twelve percent (12 %) of earnings for "Tier A" employees (hired prior to February 21, 1994), and an increase from eight percent (8 %) to ten percent (10 %) of earnings for "Tier B" employees (hired on or after February 21, 1994). In the event that the City fails to receive the written confirmation from the State of Florida Division of Retirement and the MBERP actuary that the approximated $1 M savings attributed to the pension changes agreed upon for CWA employees can be applied retroactively to the City's ARC payable on October 1, 2010, then the additional two percent (2 %) employee pension contribution for CWA members shall take effect immediately upon the expiration of the temporary twelve (12) month three and one half percent (3.5 %) wage concession. The actuary for MBERP estimates that the value of the additional two percent (2 %) contribution from CWA would yield a savings to the City's ARC of approximately $412,626 if it were to be collected for a full twelve (12) month period. Assuming the implementation of the additional two percent (2 %) employee pension contribution for CWA members commences on November 27, 2010, the City would realize a savings of approximately $347,000, thus representing a prorated portion of the $412,626 savings (November 27, 2010 through September 30, 2011) applicable towards the City's ARC payable on October 1, 2011). Furthermore, there will be an additional savings of approximately $412,626 to the City's ARC payable on October 1, 2012 derived from the additional two percent (2 %) employee pension contribution for CWA members that will be contributed during the 2011/2012 fiscal year, thus providing a total estimated savings of $760,000 through the term of the entire three (3) year labor Agreement. • Pension Plan Adjustments /Changes - As previously mentioned above, the City Commission directed the Administration to implement changes to the City's two (2) employee pension plans (Fire and Police Pension and the MBERP) which would effectuate recurring savings in the overall reduction to the City's Annual Required Contribution (ARC), as well as a reduction in the Unfunded Accrued Actuarial Liability (UAAL). In keeping with the spirit of treating similar groups of employees in a consistent manner, the Administration negotiated with the respective general employee labor unions (AFSCME, GSA and CWA) to implement changes to MBERP for current and future employees that are the same for all general employees, including the Unclassified and "Others" employees. City Commission Memorandum October 27, 2010 CWA 2009 -2012 Ratified Collective Bargaining Agreement Page 5 of 9 The target for pension changes for the general employees' salary groups applicable towards FY2009/2010 and FY2010/2011 is approximately $2.3M. After assessing a number of options to reach the target savings, the City determined that changing the Final Average Monthly Earnings (FAME), which is currently one twelfth (1/12) of the average annual earnings of the Member during the two (2) highest paid years of creditable service, to one twelfth (1/12) of the average annual earnings of the Member during the five (5) highest years of creditable service, would yield the approximate target savings for MBERP. The City recognizes that there are a number of employees who have reached or are very close to reaching retirement age eligibility. In order to minimize the impacts of this pension change, the City has agreed to implement the FAME change in a phased -in approach. Upon implementation, those employees who are twenty four (24) months or less away from Y ( ) Y retirement age eligibility will maintain a two (2) year FAME; those employees who are between twenty -four (24) and thirty -six (36) months away from retirement age eligibility will have a three (3) year FAME calculation; those employees who are between thirty -six (36) months and forty -eight (48) months away from retirement age eligibility will have a four (4) year FAME calculation; and any employees who are forty -eight (48) months or more away from retirement age eligibility will have a five (5) year FAME calculation. By changing the FAME (phased -in) for all current employees who participate in MBERP from the employee's two (2) highest years to the employee's five (5) highest years, the pension board actuary, (Gabriel, Roeder and Smith (GRS)), estimates that the City would generate a savings to the City's ARC for FY2010/2011 of approximately $1.9M. This amount is recurring and continues for future years, therefore resulting in additional, Tong -term, recurring savings in future fiscal years. The CWA's portion of the $1.9M in savings was based on their proportionate share of payroll as of March 2010. The estimated savings for adjusting the FAME for those employees covered under the CWA bargaining unit would be approximately $587,000 for FY2010/2011, thus providing a total savings over two (2) years from changes to FAME of approximately $1.17M for the entire term of the Agreement. In addition, GRS has indicated that these savings will continue to grow in perpetuity as long as the revised FAME formula remains in effect. Attached is a copy of GRS' Supplemental Actuarial Valuation Report for the additional proposed benefit changes to the MBERP for the change in FAME for all MBERP participants (Attachment "A "). In addition to changing the FAME, the CWA has also agreed to the following pension plan changes for any employees covered under the CWA bargaining unit that are hired after ratification of the 2009 -2012 Agreement: • The normal retirement date will be age 55 with at least thirty (30) years of creditable service, or age 62 with at least five (5) years of creditable service. • The early retirement date will be the date on which the member's age plus years of creditable service equal 75, with a minimum age of 55. • The Final Average Monthly Earnings (FAME) will be an average of the highest five (5) years of employment. • The benefit multiplier will be two and one half percent (2.5 %) multiplied by the member's years of creditable service, subject to a maximum of 80% of the member's FAME. • The retiree Cost of Living Adjustment (COLA) will be one and one half percent (1.5 %) per year, with the first adjustment deferred to one (1) year after the end of the DROP. • The employee contribution will be ten percent (10 %) of salary. City Commission Memorandum October 27, 2010 CWA 2009 -2012 Ratified Collective Bargaining Agreement Page 6 of 9 • The standard form of benefit is a lifetime annuity. • Members who separate from City employment with five (5) or more years of creditable service but prior to the normal or early retirement date will be eligible to receive a normal retirement benefit at age 62. • Employees will be eligible to enter the Deferred Retirement Option Plan (DROP) at the normal retirement age specified above and may participate in the DROP for a maximum of five (5) years. (The five year DROP is only applicable to those CWA employees hired on or after October 27, 2010). GRS has stated that the implementation of the pension changes for any employees hired after September 30, 2010 (any CWA employees hired after October 27, 2010) will not generate any immediate savings for the next fiscal year. However, future savings will be realized beginning in FY2011/2012 with approximately $900,000 (1.92% of payroll) in savings towards the City's ARC. The pension actuary has estimated that the City will realize an additional annual reduction of seven tenths percent (.7 %) per year of payroll applied as a reduction towards the City's ARC in perpetuity. Again, this is for all employees hired after the amendment to the City pension ordinance who participate in MBERP, not just those covered under the CWA bargaining unit. The CWA's portion of the $900,000 in savings was based on their proportionate share of payroll as of March 2010. The estimated savings for the pension changes for future employees covered under the CWA bargaining unit would be approximately $162,000 to be applied in FY2011 /FY2012. Also included in GRS' Actuarial Valuation Report are the additional proposed benefit changes to the MBERP for future employees (Attachment "B "). Other Economic and Contractual Provisions • Overtime Pay — In an effort to be more consistent with the United States Federal Government Fair Labor Standards Act (FLSA), which defines the minimum requirements that employers must adhere to for purposes of compensating for overtime, effective October 1, 2010, only actual hours worked shall be considered for the purposes of computing overtime for all CWA bargaining unit members. For example, paid leave, including but not limited to, any Annual, Holiday, Sick, Birthday, Floater, Bereavement, Compensatory Leave or Administrative Leave shall not be considered as time worked for the purpose of computing overtime. Therefore, all CWA employees will be required to physically work a full 40 hours within their scheduled workweek before qualifying for any overtime pay. Based on these changes, the City estimates a cost savings of at least approximately $225,000 for each of the two (2) remaining Contract years, thus providing a total savings of at least approximately $450,000 for the entire term of the three (3) year Agreement. • Holiday Pay - In addition to the overtime pay provisions mentioned above, the City and CWA have agreed to make adjustments to the Holiday Pay provisions for all CWA members. Effective October 1, 2010, compensation for Holiday Pay will be revised as follows: o A holiday which is observed during an employee's regularly scheduled workweek shall not be considered as time worked for the purpose of computing overtime. o An employee who is not scheduled to work on an observed holiday, and does not work, shall receive straight pay for the equivalent hours of their regularly scheduled work day for the observed holiday (i.e. 8 hours or 10 hours), which is consistent with what all other general employees are provided with in regards to pay. City Commission Memorandum October 27, 2010 CWA 2009 -2012 Ratified Collective Bargaining Agreement Page 7 of 9 o If an employee woks on their regularly scheduled day, and it is also an observed holiday, the employee shall receive holiday pay at 1 /2 the regular rate of pay for all hours worked. For example, if an employee is scheduled to work on a day that falls on a holiday and works eight (8) hours, they shall receive eight (8) hours of straight pay and an additional four (4) hours of holiday pay (i.e. 8 hours at straight time for working, plus 4 hours for holiday pay, for a total of 12 hours.) o If an employee's regularly scheduled day off is an observed holiday, and they are required to work that day, they shall receive pay at straight time for all hours worked plus holiday pay at straight time. For example, an employee's regularly scheduled day off is a Tuesday, which is also an observed holiday. The employee is called in to work that day. The employee shall be paid 8 hours of straight time for working, plus 8 hours of holiday pay, for a total of 16 hours. Based on these changes to how holiday pay is compensated, the City estimates a cost savings of at least approximately $35,000 per Contract year, thus providing a total savings of at least approximately $70,000 for the entire term of the three (3) year Agreement. • Longevity Pay — Prior to October 1, 2010, all Lifeguard I, Lifeguard 11 and Lifeguard Lieutenants were in the City's Automatic Step Pay Plan System. In conjunction with the Step Pay Plan, employees in these classifications are eligible to receive Longevity incentive pay, whereas employees receive additional, permanent, percentage -based compensation calculated on their earnings when they reach certain milestones for completed years of service with the City as follows: Completed Years of Service Percentage Increase 7 Years 2.5% 10 Years 5.0% 15 Years 7.5% 20 Years 10.0% 25 Years 11.0% As previously stated, effective October 1, 2010 all Lifeguard 1 and 11 and Lifeguard Lieutenants were placed in the City's Pay for Performance System. However, the City and the CWA have agreed to continue the Longevity incentive pay for those employees who qualify for it through the last day of the Agreement. Therefore, effective September 30, 2012 Longevity pay will cease for any and all CWA bargaining unit members. Once the Longevity incentive pay is eliminated on the last day of the Agreement, the City will realize future savings of approximately $160,000 for each fiscal year beginning in FY2012/2013. • Emergency Medical Technician (EMT) Certification Pay — Based on the terms of the existing Agreement, EMT certification is not a mandatory job requirement for the classifications of Full -Time Lifeguard 1, Lifeguard 11, Lifeguard Lieutenants and Full -time Pool Guards. Currently, those employees working in these classifications, who attain and maintain an EMT certificate given by the State of Florida receive a five percent (5 %) pay increase. However, all Lifeguard I, Lifeguard II, Lifeguard Lieutenants, Pool Guard I and Pool Guard 11 employees hired on or after September 30, 2011 will be required to have and maintain an EMT City Commission Memorandum October 27, 2010 CWA 2009 -2012 Ratified Collective Bargaining Agreement Page 8of9 certification given by the State of Florida prior to being hired by the City. In addition, effective September 30, 2012, the EMT Certification Pay shall be eliminated for any and all CWA bargaining unit members. All Lifeguard I, Lifeguard II, Lifeguard Lieutenants, Pool Guard and Pool Guard II employees, regardless of the date of hire, shall be required to have and maintain an EMT certificate given by the State of Florida. Although the EMT incentive pay will not be eliminated until the last day of the Agreement, the City will realize future savings of approximately $125,000 for each fiscal year beginning in FY2012/2013. • Reduction in Force - In exchange for the employee concessions agreed to by the CWA bargaining unit, the City has agreed that all CWA bargaining unit members will be guaranteed a job with the City for the time period of October 1, 2010 through September 30, 2012. During this time period, no employee covered under the CWA Bargaining Unit will be separated from the City for reasons other than disciplinary action, voluntary separation or whose position has been reclassified due to changes in job duties. In the event that there is an impact to a CWA bargaining unit member's position for the time period referenced above, as a result of the positions being eliminated in the budget (excluding any separations relating to disciplinary actions, voluntary separation or when an employee's position has been reclassified due to changes in job duties) the impacted employee will be offered an alternative position with the City for which they meet the minimum qualifications. • Union Time Bank - The CWA has agreed to a reduction in their Union Time Bank. Effective October 1, 2010, the Union Time Bank will be reduced from 3,000 hours to 1,500 hours per year to be used by the Union President and his /her designee to conduct union business during regularly scheduled work hours. Based on the agreed upon terms, the City estimates a savings of approximately $45,000 per Contract year, for a total savings of approximately $90,000 for the term of the entire Agreement. • Shift Differential — Pursuant to the terms of the prior Agreement (2006- 2009), CWA employees were entitled to qualify for Shift Differential incentive pay. Based on the employees schedule, when a majority of the employee's regularly assigned shift hours fall between a certain time, they would receive additional pay per hour, (which ranged from $.45 to $.55 per hour, based on the employee's shift). However, effective October 1, 2010 the Shift Differential incentive pay was eliminated for all CWA bargaining unit members. Based on the agreed upon terms, the City estimates a savings of approximately $77,000 per Contract year, for a total savings of $154,000 for the term of the entire Agreement. • Cleaning Allowance — Pursuant to the terms of the prior Agreement (2006- 2009), those CWA employees who are required to wear a City uniform, received a uniform cleaning allowance of $40.00 per month. However, effective October 1, 2010 the Uniform Cleaning Allowance supplement was eliminated for all CWA bargaining unit members. Based on the agreed upon terms, the City estimates a savings of approximately $70,000 per Contract year, for a total savings of $140,000 for the term of the entire Agreement. The FY 2010/2011 Adopted Work Plan and Budget included privatization and outsourcing initiatives, as well as the conversion of full -time to part-time positions. Implementing these initiatives would have resulted in 113 full -time positions offset by the addition of 53 part-time positions Citywide. The timeframe for implementation had yet to be determined at the time of budget adoption, so savings were offset by increased contingency. Since the adoption of the FY 2010/2011 budget, the subsequent ratification of the CWA Agreement included a "no- layoff' provision which therefore City Commission Memorandum October 27, 2010 CWA 2009 -2012 Ratified Collective Bargaining Agreement Page 9 of 9 precludes the implementation of these initiatives, at least in the short -term. The City will pursue these initiatives, where feasible, through attrition. As a result, a budget amendment reinstating these positions will be brought to the City Commission at a future meeting. CONCLUSION The terms and conditions of the proposed amended three (3) year labor Agreement include CWA employee concessions that total approximately $1.87M for FY2009/FY2010 and FY2010/2011 with a total savings of approximately $4.28M for the three (3) year contract, while achieving the City's goal for pension changes with both short -term and long -term implications. The Administration recommends adopting the Resolution to ratify the three (3) year labor Agreement with the CWA bargaining unit for the time period covering October 1, 2009 through September 30, 2012. JMG /HMF /RI /cg { T:\AGENDA \2010 \October 27 \Regular \CWA 2009 -2012 Labor Agreement Memo.doc 5 Attachment A GRS Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1616 phone Consultants tic Actuaries Suite 505 954.525.0083 fax Ft. Lauderdale, FL 33301 -1827 www.gabrielroeder.com • • August 3, 2010 • Mr. Rick Rivera Pension Administrator City of Miami Beach 1700 Convention Center Drive Miami Beach, Florida 33139 • Re: Actuarial Impact Statement for Proposed Benefit Changes to the Miami. Beach Employees' Retirement Plan Dear Ramiro: As requested, we have prepared the enclosed Actuarial Impact Statement showing the financial effect of the following proposed changes to the Miami Beach General Employees' Retirement System: 1. Increase employee contributions by 2% 2. Change final average earnings period from two to five years, except for members who are less than five years away from normal retirement eligibility. Members who are eligible for normal retirement in two years or less will have average earnings of two years. Members who are eligible for normal retirement in three years will have average earnings of three years. Members who are eligible for normal retirement in four years will have average earnings of four years. 3. Change the following for new hires only: a. Normal Retirement Age of 55 with 30 years of service or age 62 with 5 years of service b. Early retirement eligibility of "Rule of 75" with a minimum of age 55 c. Multiplier of 2.5 %, subject to a maximum of 80% of final average monthly earnings d. Final average monthly earnings of five years e. Normal form of payment of life annuity • f. Members may participate in the DROP for up to 5 years • g. Cost -of- living adjustment (COLA) of 1.5% at retirement (no COLA while in the DROP) h. Employee contributions of 10% Please note that the changes for new hires described in item (3) above will have no immediate financial • impact on the Plan. This report is intended to describe the financial effect of the proposed plan changes. No statement in this report is intended to be interpreted as a recommendation in favor of the changes, or in opposition to them. The calculations are based upon assumptions regarding future events, which may or may not materialize. They are also based upon present and proposed plan provisions that are outlined in the report. If you have reason to believe that the assumptions that were used are unreasonable, that the plan provisions are incorrectly described, that important plan provisions relevant to this proposal are not described, or that conditions have changed since the calculations were made, you should contact the author of this report prior to relying on information in the report. • l Mr. Rick Rivera August 3, 2010 Page 2 of 2 • If you have reason to believe that the information provided in this report is inaccurate, or is any way incomplete, or if you need further information in order to make an informed decision on the subject matter of this report, please contact the author of the report prior to making such decision. • We welcome your questions and comments. Sincerely yours, J. Stephen Palmquist, ASA • Senior Consultant & Actuary • JSP /ma Enclosures 1 • • • • Gabriel Roeder Smith & Company 1 SUPPLEMENTAL ACTUARIAL VALUATION REPORT Plan City of Miami Beach Employees' Retirement Plan Y Valuation Date October 1, 2009 Date of Report August 3, 2010 Report Requested by Board of Trustees Prepared by J. Stephen Palmquist Group Valued All active and inactive members. Plan Provisions Being Considered for Change Present Plan Provisions Before Change • Tier A employees contribute 10% of earnings and Tier B employees contribute 8% of earnings to the Plan • Normal Retirement eligibility is age 50 with five years of credited service for Tier A employees and age 55 with five years of credited service for Tier B employees. • Early Retirement is available for Tier B members of the former General Plan whose age plus service is greater than 75, not earlier than age 50. • The multiplier is 3% with a total accrual cap of 90% for Tier A members and 80% for Tier B members. • Earnings are averaged over the two highest paid years. • The normal form of payment is a 50% joint and survivor annuity payable to the spouse. • Members who are eligible for normal retirement may participate in the deferred retirement option program (DROP) for up to three years. • Retirees receive an annual cost -of- living adjustment (COLA) of 2.5 %. The COLA is not payable while members are in the DROP. Proposed Plan Changes The following changes would apply to current members of the Plan: 2 • Earnings would be averaged over the five highest paid years except for members who are within less than five years away from normal retirement eligibility as of September 30, 2010. Members who are eligible for normal retirement in two years or less will have average earnings of two years. Members who are eligible for normal retirement in three years will have average earnings of three years. Members who are eligible for normal retirement in four years will have average earnings of four years. • Tier A employees would contribute 12% of earnings and Tier B employees contribute 10% of earnings to the Plan. The following changes would apply only to members who are hired after September 30, 2010: • Normal Retirement eligibility would be the earlier of age 55 with 30 years of credited service or age 62 with 5 years of credited service. • Members who are at least age 55 and whose age plus credited service is greater than 75 would be eligible to receive an early retirement benefit. • The multiplier would be 2.5% with a total accrual cap of 80 %. • Earnings would be averaged over the five highest paid years. • The normal form of payment would be a life annuity • Members who are eligible for normal retirement may participate in the deferred retirement option program (DROP) for up to five years. • Retirees would receive an annual cost -of- living adjustment (COLA) of 1.5 %. The COLA is not payable while members are in the DROP. • Employees would contribute 10% of earnings to the Plan. Participants Affected The changes would apply to active members or new members as of the date of the amending ordinance. Actuarial Assumptions and Methods Same as October 1, 2009 Actuarial Valuation Report. Some of the key assumptions /methods are: Investment return — 8.35% per year Salary increase — 6% per year Cost Method — Entry Age Normal Cost Method Amortization Period for Any Change in Actuarial Accrued Liability 30 years. Summary of Data Used in Report Same as data used in October 1, 2009 Actuarial Valuation Report. 3 Actuarial Impact of Proposal(s) See attached page(s). The proposed changes for current members will decrease the annual required contribution by $3,297,614 or 4.70% of Non -DROP payroll. The changes for new hires will have no immediate financial effect. Special Risks Involved With the Proposal That the Plan Has Not Been Exposed to Previously None Other Cost Considerations None Possible Conflicts With IRS Qualification Rules None As indicated below, the undersigned are Members of the American Academy of Actuaries (MAAA) and meet the Qualification Standards of the Academy of Actuaries to render the actuarial opinion herein. By L 1 ` • . By TI , ret a - •Q.old i �C.. J. Stephen Palmquist, `A, MAAA, FCA Melis R. Algayer, M A +1, FCA Enrolled Actuary No. 1: -1560 Enrolled Actuary No. 08 -6467 • • 4 CITY OF MIAMI BEACH EMPLOYEES' RETIREMENT PLAN Impact Statement — August 3, 2010 Description of Amendment The proposed ordinance incorporates the following plan changes pursuant to 2009 -2012 collective • bargaining agreements: 1. Increase employee contributions by 2% 2. Change final average earnings period from two to five years, except for members who are less than five years away from normal retirement eligibility. Members who are eligible for normal retirement in two years or less will have average earnings of two years. Members who are eligible for normal retirement in three years will have average earnings of three years. Members • who are eligible for normal retirement in four years will have average earnings of four years. 3. Change the following for new hires only: a. Normal Retirement Age from 55 with 5 years of credited service to 55 with 30 years of service or age 62 with 5 years of service b. Early retirement eligibility from of "Rule of 75" with a minimum of age 50(only for Tier B members of the former General Plan) to "Rule of 75" with a minimum of age 55 c. Change multiplier from 3.0% to 2.5% with a maximum accrual of 80% d. Final average monthly earnings from two to five years e. Normal form of payment from 50% joint and survivor annuity to life annuity f. Extend maximum DROP participation from 3 to 5 years g. Change cost -of- living adjustment (COLA) from 2.5% to 1.5% at retirement (no COLA during DROP participation) h. Employee contributions of 10% Funding Implications of Amendment An actuarial cost estimate is attached. The annual required City contribution to the System would decrease by $3,297,614 or 4.70% of Non -DROP payroll. The changes for new hires will have no immediate financial effect. Certification of Administrator I believe the amendment to be in compliance with Part VII, Chapter 112, Florida Statutes and Section 14, Article X of the Constitution of the State of Florida. For the Board of Trustees as Plan Administrator 5 ANNUAL REQUIRED CONTRIBUTION (ARC) A. Valuation Date October 1, 2009 October 1, 2009 Increase/ Valuation Increase EE Cont. (Decrease) by 2% and 5 -Year Final Average Earnings B. ARC to Be Paid During Fiscal Year Ending 9/30/2011 9/30/2011 C. Assumed Date of Employer Contrib. 10/1/2010 10/1/2010 D. Annual Payment to Amortize Unfunded Actuarial Liability $ 7,119,977 $ 6,598,080 $ (521,897) E. Employer Normal Cost 9,545,472 7,023,886 (2,521,586) F. ARC if Paid on the Valuation Date: D +E 16,665,449 13,621,966 (3,043,483) G. ARC Adjusted for Frequency of Payments 18,057,014 14,759,400 (3,297,614) H. ARC as % of Covered Payroll - Non -DROP Payroll 25.76 % 21.06 % (4.70) % - Total Payroll 24.79 % 20.26 % (4.53) % I. Covered Payroll for Contribution Year - Non -DROP Payroll 70,097,549 70,097,549 0 - Total Payroll 72,835,309 72,835,309 0 • • 6 ACTUARIAL VALUE OF BENEFITS AND ASSETS a , A. Valuation Date October 1 2009 October 1 2009 Increase/ Valuation Increase EE Cont. (Decrease) by 2% and 5-Year t: Final Average Earnings B. Actuarial Present Value of All Projected Benefits for 1. Active Members a. Service Retirement Benefits $ 267,872,671 $ 255,645,788 $ (12,226,883) b. Vesting Benefits 27,198,459 25,471,962 (1,726,497) c. Disability Benefits 15,514,626 14,646,130 (868,496) d. Preretirement Death Benefits 5,251,473 4,959,831 (291,642) e. Return of Member Contributions 651,313 702,197 50,884 f. Total 316,488,542 301,425,908 (15,062,634) 2. Inactive Members a. Service Retirees & Beneficiaries 327,327,568 . 327,327,568 - b. Disability Retirees 9,874,613 9,874,613 - ? c. Terminated Vested Members 12,914,814 12,914,814 - d. Total 350,116,995 350,116,995 - 3. Total for All Members 666,605,537 651,542,903 (15,062,634) C. Actuarial Accrued (Past Service) 1 1 Liability per GASB No. 25 551,698,377 545,536,965 (6,161,412) i D. Plan Assets 1. Market Value 349,416,064 349,416,064 - 2. Actuarial Value 419,393,718 419,393,718 - E. Unfunded Actuarial Accrued Liability (C -D2) 132,304,659 126,143,247 (6,161,412) I F. Funded Ratio (D2 - C) 76.0 % 76.9 % 0.9 % G. Actuarial Present Value of Projected Covered Payroll 518,982,308 518,982,308 - H. Actuarial Present Value of Projected Member Contributions 39,721,439 49,466,392 - 9,744,953 • r a r 7 CALCULATION OF EMPLOYER NORMAL COST A. Valuation Date October 1, 2009 October 1, 2009 Increase/ Valuation Increase EE Cont. (Decrease) by 2% and 5 -Year Final Average Earnings B. Nor nal Cost for 1. Service Retirement Benefits $ 11,131,111 $ 10,240,454 $ (890,657) 2. Vesting Benefits 1,707,845 1,571,795 (136,050) 3. Disability Benefits 1,212,589 1,136,630 (75,959) 4. Preretirement Death Benefits 374,643 349,892 (24,751) 5. Return of Member Contributions 214,559 214,559 - 6. Total for Future Benefits 14,640,747 13,513,330 (1,127,417) 7. Assumed Amount for Administrative Expenses 657,393 657,393 - 8. Total Normal Cost 15,298,140 14,170,723 (1,127,417) % of Covered Payroll - Non -DROP Payroll 21.82 % 20.22 % (1.61) % - Total Payroll 21.00 % 19.46 % (1.55) % C. Expected Member Contribution 5,752,668 7,146,837 1,394,169 % of Covered Payroll - Non -DROP Payroll 8.21 % 10.20 % 1.99 % - Total Payroll 7.90 % 9.81 % 1.91 % D. Employer Normal Cost: B8 -C 9,545,472 7,023,886 (2,521,586) % of Covered Payroll - Excluding DROP Payroll 13.62 % 10.02 % (3.60) % - Including DROP Payroll 13.11 % 9.64 % (3.46) % • y�j 8 ,, PARTICIPANT DATA October 1, 2009 October 1, 2009 Before Changes After Changes ACTIVE MEMBERS Number (Non -DROP) 1,154 1,154 Covered Annual Non -DROP Payroll $ 70,097,549 $ 70,097,549 Average Annual Non -DROP Pay $ 60,743 $ 60,743 Total Covered Annual Payroll $ 72,835,309 72,835,309 Average Annual Pay $ 61,258 61,258 Average Age 43.5 43.5 Average Past Service 8.2 8.2 Average Age at Hire 35.3 35.3 DROP PARTICIPANTS Number 35 35 Annual Benefits $ 1,763,119 1,763,119 Average Annual Benefit $ 50,375 50,375 Average Age 57.9 57.9 RETIREES & BENEFICIARIES Number 972 972 • Annual Benefits $ 28,200,927 $ 28,200,927 Average Annual Benefit $ 29,013 $ 29,013 Average Age 70.8 70.8 DISABILITY RETIREES Number 41 41 Annual Benefits $ 936,354 $ 936,354 Average Annual Benefit $ 22,838 $ 22,838 Average Age 65.9 65.9 TERMINATED VESTED MEMBERS Number 79 79 Annual Benefits $ 1,373,077 $ 1,373,077 Average Annual Benefit $ 17,381 $ 17,381 Average Age 46.9 46.9 Attachment B Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1616 phone GRS Consultants & Actuaries Suite 505 954.525.0083 fax Ft. Lauderdale, FL 33301 -1827 www.gabrielroeder.com ' 3 • June 4, 2010 Mr. Ramiro Inguanzo © ' Human Resources Director City of Miami Beach rr� 1700 Convention Center Drive o" w r7 Miami Beach, Florida. 33139 • N ca co Re: Supplemental Actuarial Valuation Report for Additional Proposed Benefit Changes tPsthe Miami Beach Employees' Retirement Plan Dear Ramiro: As requested, enclosed is a 10 -year projection of cost savings assuming the proposed changes listed below apply to new hires of the Miami Beach Employees' Retirement Plan. When performing these projections, we assumed that there would be no gains and losses or assumption changes after September 30, 2009. In actuality, there will likely be losses due to investments over the next four years. ® Normal Retirement Age of 55 plus 30 years of service or 62 with 5 years of service • Early Retirement eligibility of "Rule of 75" with a minimum of age 55 o Multiplier of 2.5% for all service • Final average earnings of five years • Normal form of payment of life annuity O Extend DROP to 5 years • Retiree COLA of 1.5% (no COLA while in the DROP) • • Employee contributions of 10% Since the Normal Retirement Age would be raised, we used the same normal retirement probabilities that are currently used for Tier B members. All other assumptions and provisions are the same as outlined in the October 1, 2009 report. This report is intended to describe the financial effect of the proposed plan changes. No statement in this report is intended to be interpreted as a recommendation in favor of the changes, or in opposition to them. The calculations are based upon assumptions regarding future events, which may or may not materialize. They are also based upon present and proposed plan provisions that are outlined in the report. If you have reason to believe that the assumptions that were used are unreasonable, that the plan provisions are incorrectly described, that important plan provisions relevant to this proposal are not described, or that conditions have changed since the calculations were made, you should contact the author of this report prior to relying on information in the report. Attachment "8 ", • Mr. Ramiro Inguanzo • June 4, 2010 Page 2 of 2 If you have reason to believe that the information provided in this report is inaccurate, or is in any way incomplete, or if you need further information in order to make an informed decision on the subject matter of this report, please contact the author of the report prior to making such decision. We welcome your questions and comments. • Sincerely yours, J. Stephen Palmquist, ASA Senior Consultant & Actuary JSP /ma Enclosure - • • Gabriel Roeder Smith & Company 4 ' Projection of Annual Cost (Savings) :' w New Benefit Structure for New Entrants w Fiscal. y Year ,. Ending Dollar % of 9/30 Amount Payroll 2011 $ - - % 2012 (910,469) (1.25) 2013 (1,451,167) (1.91) 2014 (2,057,695) (2.61) 2015 (2,573,495) (3.14) 2016 (3,118,987) (3.66) 2017 (3,627,557) (4.09) 2018 (4,163,830) (4.52) 2019 (4,779,456) (4.99) 2020 (5,376,792) (5.39) 2021 (5,994,726) (5.78) • Benefit Structure for New Entrants: • • Normal Retirement Age of 55 plus 30 years of service or 62 with 5 years of service • Early Retirement eligibility of "Rule of 75" with a minimum of age 55 ® Multiplier of 2.5% for all service • Final average earnings of five years • Normal form of payment of life annuity t • Extend DROP to 5 years • Retiree COLA of 1.5% (no COLA while in the DROP) O Employee contributions of 10% Note: As indicated in the cover letter, these projections have been prepared as though there would be no experienc gains or losses or assumption changes after 9/30/2009. This assumption was made in order to keep the projectio simple and uncluttered. • i 1 June 4, 2010 4 0 Changes Mr. Ramiro Inguanzo Report :dc Iii,,,:::,,,,,,,),,,,::,.,_ Human Resources Director City of Miami Beach . 1700 Convention Center Drive M Beach, Florida 33139 : Re: i Proposed Bene , to the Miami Beach Employees' Supplemental Actuarial Valuation t at p io lan n Rep for 77 . t. ,..., Dear Ramiro: .-- A req enclosed is a 10-year proit[iPii,„„elfcosaivii4:: Retiremen assum the propose d change new hires of the Miaml'ookok- Employees' Fee nt Plan. When performin these projections, we assumed that there would be'kg or assumption c hanges after September ls below apply to ne II e, 2009. In actuality, there will likely be losses dix,;o investmen o the four years. • Normal Retirement 40a4kP ,_,, c' n,42.g?' ,,. 62 with 5 years of service • Early Retirement i 3 eof e* 754ipf7i a in m 0f . age 55 plus 30 Y eligibility OWaT • Multiplier of:24 for all service • Final average earnings of five years • Normal form coi of , op to 5 '''''''•,-74-,if while ifi''' • Extend . :41: , 1.50k whi e in the DROP) R,4".'i''':41-9 7 4.40.,,- . -74/0 • ,..',.t;ri± elOyee con ' r o Since the and provisions • are the same as outlined in the October 1, Normal other as • ent ": t we used that . .a1Retirem would raised, for members. members. are currentlf'LL!_ f Tier B , ° 111 Ai This report o is intend4*10 t ascribe the financial effect of the proposed plan cchhaannggeess.,Noor in opposition to statement in this report is intended to be interpre d as a recommen dation in favor of e h them. Y The calculations are based upon assumptions regarding future events, tasr, are outlined which in the re port. If ou ich may or may n eria are lize. They are also based upon present and proposed planpnrovisions h have reason to believe that the assumptions that were vaeruesleedanrt to this e unreasonable, are not ha provisions o p at incorrectly described, thati important described, materialize. , or that conditions have change d since i o t r i t iec t an provisions calculations were made, you shhouldroPcoo l n ot contact the author of this report prior to relying on info ation in the report. Mr. Ramiro Inguanzo 1 1 June 4, 2010 Page 2 of 2 If you have reason to believe that the information provided in this report is inaccurate, or is in any way incomplete, or if you need further information in order to make an informed decision on the subject matter of this report, please contact the author of the report prior to making,suh decision. We welcome your questions and comments Sincerely yours, x , 4:IL Ilk. J. Stephen Palmquist, ASA Senior Consultant & Actuary. H JSP /ma Enclosure 4 1 0 4 : 1001000. , 4 Projection of Annual Cost (Savings) New Benefit Structure for New Entrants Fiscal Year Ending Dollar % of 9/30 Amount Payroll, 2011 $ - - °/ 2012 (910,469) (1.25 2013 1,, 2014 (2 ,057,695 ) 2015 (2,573,495) ( .14) 2016 (3,118,9871k-0A- �` " (3.66) 2017 (3,627, 7) . (4.09) 2018 �� r�," (4,1. .) (4.52) 2019 (4, " �6) ( ' 2020 (5,37., 2021 (5,994,72. : ) Benefit Structure for New Entrants: • Normal Retirement Age of 55 plus 30 years of s e or "" <' s o service • Early Retirement eligibility of 5" with ' ► e' "' of age • Multiplier of 2.5% for ice • Final average earnings of f ve years • Normal form of payme life annu' • Extend DROP to 5 years 1 " • Retiree CO , * o no CO w le in the • • Employe .:.. 10°0 Note: As indicated in the cover le these • v ; y = ct have been prepared as though there would be no experience gains or lo ' r assumption c _es after 9/30/2009. This assumption was made in order to keep the projections simple and une uttered.