Fiscal Year 2013-2015 Special Budget Meeting
Informational ReportFiled under council matter 12-0351
Subject: Fiscal Year 2013-2015 Special Budget Meeting From: City Administrator's Office Recommendation: Receive A Presentation And Hold Discussion On The Mayor's Proposed Budget For Fiscal Year 2013-2015
Extracted text
Deanna J. Santana, City Administrator
Subject: Proposed FY 13-15 Proposed Policy Budget
Date:. April 25, 2013
Page 4
Regarding pension obligations, the dramatically increased employer contributions that are
required by CalPERS to boost the funded ratio beginning in FY 2013-14 are accounted for in
the proposed budget and the revised five-year forecast it contains. The below table illustrates
the total annual Cal-PERS Costs from 2006-2018:
$120,000,
$100,000,
$80,000,
$60,000,
$40,000,
$20,000,
Total Annual Cal-PERS Cost
$97,949,881
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•Total Annual
Cal-PERS Cost
^'^Projections
Covered Payroll is based on FY 2014-2015.
Computed on baseline payroll, projected as of February 1, 2013
The City also recently made a significant payment into the Police and Fire Retirement
System (PFRS) fund to increase its funded ratio and pre-pay its annual obligation for five
years. The City's future obligations will be mitigated by the implementation of a third
retirement tier and recent State legislation. So, although there is still work to be done in
funding CalPERS and PFRS, the Administration believes that it has taken prudent steps this
fiscal year and in the proposed budget to help ensure adequate funding of these obligations.
The City's situation regarding OPEB liabilities is similar to that of most other public and
private organizations. The City has assessed the liability ^ d is performing required
reporting. The Administration is crafting a long-term plan to fund this liability, beginning
with a proposal that it will advance, when workload permits, to establish a trust to pay for
OPEB liabilities.
The City has already taken strong steps to address its negative funds. As reported elsewhere,
the City has reduced its negative fund balance from $138 million to less than $100 million
over four years. The most significant negative funds are on repayment plans. The City must
still determine an approach to repaying negative funds that are not reimbursable, but
generally we feel that the negative fund challenge is being managed.
Item:
City Council
April 30,2013