Politics & Government

Pension Reform Plan Adopted on Split Vote by RPV Council

Rancho Palos Verdes City Council members adopt revisions to the city's pension plan with general support from city employees.

A lengthy debate on city pension reform found some closure this week after members on a split vote approved revisions that would require city staff to take on more of their retirement plan contributions.

“What we have come up with is not perfect,” Councilman Steve Wolowicz said during Tuesday night’s city council meeting. “We’re stuck … playing the cards that were dealt us in the best way that we can.”

Under the adopted pension plan revisions, full-time city employees will receive a one-time salary increase of 5 percent, while taking on the city’s payment of a 6.5 percent retirement plan contribution. Under this revision, which is effective with the pay period beginning Sept. 23, employees will see a net decrease of 1.5 percent in compensation.

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New employees will be placed on a “second tier” plan with benefits determined based on the average of the three highest salary years.

Tuesday night’s meeting drew multiple current city employees, many of whom said the plan would be a manageable hardship. Most urged council members to vote for the plan revisions.

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The plan, created by Wolowicz and Mayor Tom Long, is projected to save the city between $1.2 million and $1.6 million over the course of six years.

An alternative to the plan, proposed by Councilman Anthony Misetich, would have phased in the 6.5 percent pension contribution—taken over by employees—over three years. His plan was estimated to save the city between about $2.1 million and $2.3 million over six years, depending on the rate of employee turnover.

At the beginning of discussions Tuesday night, Misetich asked for more time to review the plan and look for alternatives, saying he wanted to wait for input from an outside taxpayers association.

“Unfortunately, I do not have everything I need here to make this decision tonight,” Misetich said.

Long opposed any delay, citing losses to the city with every passing pay period.

"We have to make the decision ... in a business-like and responsible way," he said.

Wolowicz called some vote disagreement voiced by “potshots.”

“I’m looking to start the clock for pension savings in this city,” he said. “The proposal … while not perfect is as good as we can get it.”

Under the plan, current and new RPV city employees will pay a full 8 percent Employer Paid Member Contribution (EPMC) to CalPERS, the California Public Employees Retirement System. The contributions are usually paid in part by the city.

Effective with the pay period that starts Sept. 23, part-time employees of the city will receive a one-time 1 percent wage increase, while taking on the 8 percent contribution, up from a current 7 percent.

Neighboring Rolling Hills Estates recently provided a one-time 7 percent salary increase in exchange for employees taking on the entire 7 percent EPMC, formerly paid by the city.


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