TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Javier Carcamo, Finance Director
PREPARED BY: Paige Hartman-Salazar, Management Analyst
SUBJECT: Adoption of Other Post Employment Benefit Funding Policy
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RECOMMENDATION
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Adopt Resolution 23-4714 entitled: A Resolution of the City Council of the City of Murrieta, California, Approving the Adoption of the Other Post-Employment Benefits (OPEB) Funding Policy.
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PRIOR ACTION/VOTE
On June 2, 2009, the City Council adopted Resolution No. 09-2272, authorizing the agreement between the City and CalPERS for the California Employer's Retiree Benefit Trust Program (CERBT) to prefund OPEB through CalPERS (Vote: 5-0)1.
CITY COUNCIL GOAL
Maintain a high performing organization that values fiscal sustainability, transparency, accountability and organizational efficiency.
BACKGROUND
The City of Murrieta (City) provides a single employer defined OPEB plan that provides medical and prescription coverage at retirement. Employees may continue health coverage with the City at retirement for themselves, their spouses, and dependents for life once they meet certain eligibility requirements. The amount of City contribution differs depending on the retirement date and City hire date, as explained in further detail below. Employees are eligible for this benefit once they retire, within 120 days from the date of separation, and the retiree must be receiving benefits from the California Public Employees Retirement System (CalPERS).
OPEB Trust
On June 2, 2009, City Council authorized the establishment of the CERBT Fund. CERBT is a Section 115 trust fund dedicated to prefunding OPEB like retiree healthcare. One of the benefits of the trust includes investment income generation from employer contributions to pay for future retiree benefits.
OPEB Plan Provisions
The City's OPEB has multiple-tier plans based on...
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