To: Board of Supervisors of the County of Sonoma
Department or Agency Name(s): Human Resources
Staff Name and Phone Number: Janie Carduff, (707) 565-3995
Vote Requirement: Majority
Supervisorial District(s): All
Title:
Title
Memorandum of Understanding between the County of Sonoma and Western Council of Engineers
End
Recommended Action:
Recommended action
Adopt a Concurrent Resolution approving the Memorandum of Understanding between the County of Sonoma and the Western Council of Engineers from Board Adoption through June 1, 2023.
end
Executive Summary:
Representatives of the County and the Western Council of Engineers (WCE) met and conferred and reached a Tentative Agreement (Attachment A) regarding negotiated changes to the terms and conditions of employment for a successor Memorandum of Understanding (MOU) to be effective from Board adoption through June 1, 2023. All changes negotiated for the 2019-2023 successor MOU become effective upon adoption by the Board of Supervisors/Board of Directors scheduled on December 2, 2019, unless otherwise specified within the Tentative Agreement. WCE membership has voted and ratified the Tentative Agreement.
Discussion:
Due to the fiscal uncertainty caused by the October 9, 2017 Sonoma Complex fires, the County and WCE previously negotiated a one year extension of the 2016-2018 MOU, which expired on July 1, 2019. Recently, representatives of the County and WCE met and conferred and reached a Tentative Agreement on November 12, 2019 regarding the terms and conditions of employment, which will be effective from Board Adoption through June 1, 2023.
The following is a brief summary of the major provisions negotiated in this agreement:
Term of MOU
From Board adoption through June 1, 2023
Salary - Hourly Cash Allowance:
The hourly cash allowance of $3.45 will be phased out for all job classifications covered by the MOU, based upon the following schedule:
• Effective December 3, 2019, cash allowance will be reduced to $2.30/hour
• Effective May 19, 2020 cash allowance will be further reduced to $1.15/hour
• Effective May 18, 2021 cash allowance will be reduced to $0/hour
Salary Adjustments
Salary adjustments will be made to the benchmark job classification that is below the market average. Additional salary adjustments will be made as outlined in Appendix A-1. Effective dates of the adjustment to each benchmark classification, and concurrent adjustments to non-benchmark classifications consistent with internal salary administration alignments as outlined in Appendix B-1, attached, will be based upon the following schedule:
• Effective December 3, 2019, each job classification will be increased by $1.15/hr., then the County Engineer Benchmark classification will be increased by 4.0%
• Effective May 19, 2020, each job classification will be increased by $1.15/hr., then the Water Agency Engineer Benchmark classification will be increased by 0.45%
• Effective May 18, 2021, each job classification will be increased by $1.15/hr., then the Water Agency Engineer Benchmark classification will be increased by 0.45%
Cost of Living (COLA) Adjustments
During the four year term, all job classifications covered by this MOU will be provided annual COLA adjustments consistent with internal salary administration alignments, based upon the following schedule, and as listed in Appendix B of the Tentative Agreement:
• Effective December 17, 2019 - Increase of 2.9%
• Effective June 2, 2020 - Increase of 2.9%
• Effective June 1, 2021 - Increase of at least 1.95%, and not more than 3.95%*
• Effective May 31, 2022 - Increase of at least 1.95%, and not more than 3.95%*
* Based upon the lesser of San Francisco-Oakland-Hayward All Urban Annual Consumer Price Index (CPI-U), or the County’s actual annual secured property tax growth percentage, divided by 1.5.
Health & Welfare
Effective the pay period beginning December 3, 2019, the County’s monthly contribution towards medical plan premiums will be based upon the following schedule:
|
Effective Pay Period |
Dec 3, 2019 |
May 19, 2020 |
May 18, 2021 |
May 17, 2022 |
|
Employee Only |
$700/mo. |
$742/mo. |
$786/mo. |
$834/mo. |
|
Employee + 1 |
$1,400/mo. |
$1,484/mo. |
$1,574/mo. |
$1,668/mo. |
|
Employee + 2 or more |
$1,980/mo. |
$2,100/mo. |
$2,224/mo. |
$2,358/mo. |
Pension - Required Employee Contributions
Employees hired before January 1, 2013, or hired after January 1, 2013 who qualify for pension reciprocity and are eligible for retirement benefits under SCERA Plan A, will continue to contribute an additional 3.03% for general members of pensionable compensation until separation of employment from the County, to continue to share pension costs associated with unfunded liability. For employees hired on or after January 1, 2013, there is no change to the existing expiration date, and these employees will continue to pay the 3.03% for general retirement through July 2024.
Union Dues Deductions
Includes administrative changes of authorization procedures for employee payroll deductions for payment of union dues, in compliance with Federal and State law changes.
Other Miscellaneous Changes
• Provides an annual increase to the Staff Development and Wellness allowance for full time employees from $950 to $1,500 and for part time employees from $475 to $750.
• Updates and clarifies dependent eligibility for health benefits
• Administrative changes and clarification of definitions within the salary upon promotion, sick leave and mileage reimbursement articles
• Additions to the disciplinary hearing process for non-civil service positions
Retirement Benefits Committee
Provides for the formation of a Labor/Management Retirement Benefits Committee in March 2021 for the purpose of analyzing County retirement benefits, and to develop recommendations for optimal long-term solutions that meet the interests and needs of all impacted parties and position the County to have total compensation market competitiveness and workforce stability. Discussions shall address the following items: unfunded liability cost sharing; pension cost sharing; pension obligation bonds; retiree medical benefits; longevity; and retiree cost of living adjustment. The Committee will make advisory recommendations to the County Administrator.
Government Code Compliance Requirements
Various provisions of the California Government Code require certain disclosures before the Board can adopt changes in salaries or benefits, with additional disclosure required for changes in pension and other post-employment benefits. Any changes in salaries and benefits must be adopted at a public meeting of the Board (Cal Gov’t Code §23026). Notice of the consideration of such increases must be provided prior to the meeting and shall include “an explanation of the financial impact that the proposed benefit change or salary increase will have on the funding status of the county employees' retirement system.” (Cal Gov’t Code §31515.5).
In addition, when considering changes in retirement benefits or other postemployment benefits, the Board “shall secure the services of an actuary to provide a statement of the actuarial impact upon future annual costs, including normal cost and any additional accrued liability, before authorizing changes in public retirement plan benefits or other postemployment benefits.” (Cal Gov’t Code §7507). When there are changes in retirement benefits or other postemployment benefits, the statement of actuarial impacts shall be provided by an enrolled actuary and shall be made public at a meeting at least two weeks before the adoption of the increase in benefits. (Cal Gov’t Code §31516). This staff report recommends the Board adopt changes in the WCE MOU, including changes to salary and benefits contributions only, with no changes to pension benefits or other post-employment benefits (retiree medical).
Segal Valuation Analysis
Based on the analysis conducted by Segal Consulting (Segal), the actuaries for the Sonoma County Employees Retirement Association (SCERA), the net impact over the four year MOU term results in an increase in the County’s annual contributions, and it is anticipated the actuarial assumptions included in future years’ valuations will be sufficient to cover the costs of all negotiated salary increases and other salary adjustments over the four year term.
The analysis compares proposed labor changes to the following Sonoma County Employees’ Retirement Association (SCERA) adopted salary assumptions:
• 3.5% applied to the 2017 Actuarial Valuation used to establish employer and employee pension contribution rates for 2019-20
• 3.25% used in the December 31, 2018 valuation, and to be used for the FY 2020-21, 2021-22, and 2022-23 contribution rates
The actuarial assumption variations offset increases and decreases from year to year, resulting in an overall net increase in County costs of $26,700 over the four fiscal years, and should not materially impact the ongoing cost of the plan of the funding status of SCERA. Segal’s analysis of the annual impact over each fiscal year is included in Attachment B, and summarized in the table below.
|
|
Annual Employer Normal Cost |
Annual UAAL amortized cost |
Total Annual Increased Contribution |
|
|
(a) |
(b) |
(a + b ) |
|
FY - 2019/20 |
-$4,000 |
-$8,000 |
-$ 12,000 |
|
FY - 2020/21 |
+$17,000 |
+$29,000 |
+$46,000 |
|
FY - 2021/22 |
-$500 |
-$800 |
-$1,300 |
|
FY - 2022/23 |
-$2,000 |
-$4,000 |
-$6,000 |
|
Net Increased Costs over 4 year term |
+$10,500 |
+$16,200 |
+$26,700 |
Prior Board Actions:
October 23, 2018: Adopted WCE MOU Extension, Concurrent Resolution #18-0444
July 19, 2016: Adopted Successor WCE MOU, Concurrent Resolution #16-0247
July 30, 2013: Adopted WCE MOU, Concurrent Resolution, #13-0296
Fiscal Summary
|
Expenditures |
FY 19-20 Adopted |
FY20-21 Projected |
FY 21-22 Projected |
FY 22-23 Projected |
|
Budgeted Expenses |
$ 302,381 |
$469,748 |
$ 346,637 |
$320,750 |
|
Additional Appropriation Requested |
|
|
|
|
|
Total Expenditures |
$ 302,381 |
$469,748 |
$ 346,637 |
$320,750 |
|
Funding Sources |
|
|
|
|
|
General Fund/WA GF |
$ 302,381 |
$469,748 |
$ 346,637 |
$320,750 |
|
State/Federal |
|
|
|
|
|
Fees/Other |
|
|
|
|
|
Use of Fund Balance |
|
|
|
|
|
Contingencies |
|
|
|
|
|
Total Sources |
$ 302,381 |
$469,748 |
$ 346,637 |
$320,750 |
Narrative Explanation of Fiscal Impacts:
The successor MOU represents a total estimated operational cost increase for fiscal year 2019/20 of $302,381. The majority of the estimated increases for FY 2019/20 have been incorporated into the Recommended Budget which was approved by the Board during the FY 2019/20 Budget Hearings. Future projected cost increases will be incorporated into budget development for future fiscal years.
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Staffing Impacts: |
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Position Title (Payroll Classification) |
Monthly Salary Range (A-I Step) |
Additions (Number) |
Deletions (Number) |
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Narrative Explanation of Staffing Impacts (If Required):
Not applicable.
Attachments:
Resolution
Attachment A - Signed Tentative Agreement
Attachment B - GC 31515.5 Disclosure Letters from Segal Consulting dated November 21, 2019
Related Items “On File” with the Clerk of the Board:
None.