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1983-1220_OC EMPLOYEES RETIREMENT SYSTEM_Agreementi Sty" VI I ifi ` 2 i 3I 4I 5 6 7 8 �{ 9� i 10 11 , 12 13 .1 P 14 18 19 j 20 21 22 23 1 24 25 28 AGREEMENT RE0EIVED THIS AGREEMENT, made and entered into this 20th " & .l December 1983, by and between the BOARD OF RETIABME * OF THE ORANGE COUNTY EMPLOYEES RETIREMENT SYSTEM (hereinafter' "BOARb54r� and the CITY OF SAN JUAN CAPISTRANO, a municipal corporation (herein- after "CITY"); WITNESSETH: WHEREAS, BOARD is the governing body of the Orange County Employ- ees Retirement System, a public retirement system which provides pension benefits for certain public employees, and CITY is a munici- pality situated in the County of Orange; and WHEREAS, effective November 1, 1975, CITY and BOARD entered into a written agreement (hereinafter, "the Agreement") which provided that officers and employees of CITY would become members of, and eligible to receive retirement benefits from, the Orange County Employees Retirement System; and WHEREAS, such membership in the Retirement System, and the benefits derived therefrom, would constitute a part of the compen- sation provided by CITY to such officers and employees; and WHEREAS, the Agreement between CITY and BOARD contains the following provision: 11-1-83 DHR:rer "All of CITY's officers and/or employees shall be subject to medical approval of the County as determined by the results of physical examina- tions, and if any shall be found medically unqual- ified, CITY agrees, in consideration of membership of such person, to keep and hold the BOARD free and harmless from any liability for disability 1. 1 2 3 1 4� I SI 6 7� 61 9I 10 11 � i 12 13 . 14 18 '9 20 21 22 23 24 25 26 I 7 28 claims that may arise as a result of the aforesaid medical reasons, except to the extent of the employee's contributions. If an employee becomes entitled to a disability retirement allowance arising out of the condition for which the County deemed him or her unqualified, the CITY will be liable for all amounts of such retirement allow- ance, including survivor benefits and death .. benefits not.funded by the employee and employer's contributions."; and WHEREAS, on or about December 13, 1982, James E. Michael, an employee of CITY, was found to be eligible for a service -connected disability retirement allowance, with an effective date of May 27, 1981; and WHEREAS, the said James E. Michael was employed by the CITY as of, and prior to, November 1, 1975, and in accordance with the above - quoted portion of the Agreement, the said James E. Michael was found at that time to be medically unqualified for employment, and CITY is therefor: now required to hold BOARD free and harmless from the cost of providing disability retirement benefits to James E. Michael and his eligible survivors; and WHEREAS, the actuarial equivalent cost of providing service - connected disability retirement benefits to James E. Michael and any eligible survivors is $134,943.68, and CITY is presently obligated to pay BOARD said sum, and no part thereof has previously been paid, and such indebtedness constitutes a current obligation imposed on the CITY by contract and by law; and 11-1-83 DHR:rer 2. 5 6 7 8i 9�, 10 11 12 13 i 14 18 19, I 20 21 22 23 21 25 26 0 27 LL J 28 0 WHEREAS, CITY desires to pay the aforesaid sum to BOARD in semi-annual installment payments, together with interest on the unpaid balance, and BOARD is willing to accept such payment in installments; NOW, THEREFORE, THE PARTIES AGREE AND CONTRACT AS FOLLOWS: 1. The foregoing recitals of fact are true. 2. In order to settle the CITY's obligation to BOARD, the parties agree that as of December 13, 1982, CITY has been indebted to DOARD in the principal amount of $134,943.68, plus -nterest thereon accruing at the rate of seven and one-quarter percent (7;%) per annum from July 1, 1983. This total sum of $134,943.68, with accrued interest on the declining balance, shall be paid by CITY to BOARD in semi-annual installments of $16,328.21 each, the first installment being due and payable or. January 1, 1984, and future installments being due and payable at six month intervals thereafter. The entire payment schedule is set forth below: Total Payment Date Principal Interest 1. January 1, 1984 $11,436.50 $ 4,891.71 2. July 1, 1984 11,851.07 4,477.14 3. January 1, 1985 12,280.68 4,047.53 4. July I, 1985 12,725.015 3,602.36 5. January 1, 1986 13,187.16 3,141.05 6. July 1, 1986 13,665.20 2,663.01 7. January 1, 1987 14,160.56 2,167.65 8. July 1, 1987 14,673.88 1,654.33 9. January 1, 1988 15,205.81 1,122.40 10. July 1, 1988 15,756.97 571.19 Total Principal Payment Balance $16,328.21 $123,507.18 16,328.21 111,656.11 16,328.21 99,375.43 16,328.21 86,649.58 16,328.21 73,462.42 16,328.21 59,797.22 16,328.21 45,636.66 16,328.21 30,962.7,8 16,328.21 15,205.81 16,328.16 .00 3. Hereafter, CITY promises to make, in a timely fashion, all future installment payments to BOARD pursuant to the terms of this agreement. in the event CITY should fail or refuse to tender any payment pursuant to this agreement on or before the date such payment is due, the entire unpaid principal balance and interest thereon shall 11-1-83 DHR:rer 3. li 2� 3 41 5 6 7 6 9 10 11 12 13 14 18 19 20 21 22 23 24 25 26 N O 2 lot 28 immediately become due and payable to BOARD, and BOARD may make use of any available legal remedies to enforce such payment. 4. The failure of either party to insist upon strict perfor- mance of any of the terms or conditions in this agreement shall not be deemed a waiver of any right or remedy that either party may have and shall not be deemed a waiver of any right or remedy for a subsequent breach or default of the terms of conditions herein contained. 5. Thio agreement sh-n11 not be assigned by ei.ther party without the written consent of the other party. WHEREFORE, this agreement is executed in the County of Orange, State of California, on the date and year first above written. BOARD OF RETIREMENT OF THE ORANGE COUNTY EMPLOYEES RETIREMENT SYSTEM By_ RtL. Citron, Chairman 432:R9:RD.1 11-1-83 DHR:rer 4. CITY OF SAN JUAN CAPISTRANO "CITY" ATTEST: CITY CLFK ��=�.//l/L-t--•� APPROVED AS TO FORM: IT�R�Y �� • 0 APPROVAL OF AGREEMENT FOR REIMBURSEMENT OF SERVICE -CONNECTED `(35) Written Communications: 7(38) Additional Agen a Item dated December 20, 1983, from the Senior Administrative Assistant, forwarding an agreement t� between the City and the Board of Retirement of the Orange County Employees Retirement System for reimbursement to OCERS of costs involved in the disability retirement of former employee James Michael. The total cost, including principal and 7;$ accrued interest on the declining balance, is $163,282.05. Council authorized re -payment based upon a negotiated five-year schedule of approximately $32,650 per annum; the first installment payment is due January 1, 1984, and continues at six-month intervals until July 1, 1988. Funds have been budgeted within the debt service account, and are payable through the General Fund. Approval of Agreement: - It was moved by Councilman Schwartze, seconded by Councilman Hausdorfer and unanimously carried to approve the agreement and authorize payment to the Orange County Employees Retirement System in accordance with the terms therein. The Mayor and City Clerk were authorized to execute the Agreement on behalf of the City. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 24 25 C 26 N N 27 O LL , ADRIAN KUYPER, COUNTY COUNSEL and DONALD H. RUBIN, DEPUTY 10 Civic Center Plaza P. O. Box 1379 Santa Ana, California 92702 Telephone: (714) 834-3357 Attorneys for Claimant 0 RECEIVED D -C 15 (! 07 14 '33 Jo,I n?!0 BEFORE THE CITY COUNCIL CITY OF SAN JUAN CAPISTRANO Claim of the BOARD OF RETIREMENT OF THE ) ORANGE COUNTY EMPLOYEES RETIREMENT SYSTEM, ) NOTICE OF CLAIM against the CITY OF SAN JUAN CAPISTRANO ) (Govt. Code Sec. 910) TO THE CITY OF SAN JUAN CAPISTRANO, a municipality situated within the County of Orange, State of California: The Board of Retirement of the Orange County Employees Retirement System, a public entity organized and existing pursuant to Government Code Sections 31450-31898, hereby makes claim against the City of San Juan Capistrano for the sum of $134,943.68, plus interest on said sum at the legal rate from December 13, 1982 until the date said sum is paid. I. The name and post office address of Claimant are as follows: Board of Retirement Orange County Employees Retirement System P. O. Box 4515 Santa Ana, California 92702 II. All notices concerning this claim may be sent to Claimant's attorneys, who are as follows: AN X C, 1-2-/l-6 �" 1 Adrian Kuyper, County Counsel and Donald H. Rubin, Deputy 2 10 Civic Center Plaza P. O. Box 1379 3 Santa Ana, California 92702 Telephone: (714) 834-3357 4 III. 5 The facts and circumstances giving rise to this claim are as 6 follows: 7 (a) Effective November 1, 1975, Claimant and the City of San 8 Juan Capistrano (hereinafter "City") entered into a written agreement, 9 a true and correct copy of which is attached hereto as Exhibit "A" and 10 incorporated by reference herein as though set forth in full. 11 Pursuant to said Agreement, employees of the City became members of 12 Claimant retirement system. The attached Agreement, Exhibit "A" 13 hereto (hereinafter "Agreement") sets forth certain terms and 14 conditions by which City would pay its proper share for providing W� 4Z= 15 retirement benefits to City employees. ,DO V V w 16 o�Z (b) At the time the Agreement was entered into and became 6 00 17 effective, one James E. Michael was an active employee of the City. 18 By law, and by the provisions of the Agreement and the resolution of 19 the City authorizing the Agreement, said James E. Michael became a 20 member of Claimant Orange County Employees Retirement System effective 21 November 1, 1975. 22 (c) At or about the time the Agreement became effective, James 23 E. Michael was given a physical examination by the County of Orange, 24 in accordance with the terms of the Agreement. As a result of this 25 e examination, James E. Michael was found to be suffering from a 26 N physical impairment which would have disqualified him from similar c 27 L ® 28 2. 2 3 4 5 6 24 25 h m 26 N W O 27 1 28 0 0 PROOF OF SERVICE BY MAIL (CCP SS 1013x, 2015.5) I do hereby declare that I am a citizen of the United States, alloyed in the County of Orange, over 18 years old, and that my business address is 10 Civic Center Plaza, 4th Floor, Santa Ana. I am not a party to the within action; on the 12th day of December , 19 83, at Santa Ana, California, I deposited in the United States mail a true 36E ; -0f: NOTICE OF CLAIM in said action, in a sealed envelope, with the postage thereon fully prepaid, addressed as follows: City Clerk City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 I declare under penalty of perjury that the foregoing is true and correct. EXECUTED at Santa Ana, California, this 12th day of December 1983 1 employment with the County of Orange, or would have required him to 2 sign a waiver pursuant to Government Code Section 31009 prior to 3 becoming employed by the County of Orange. 4 (d) Pursuant to the foregoing, and pursuant to the provisions of 5 the Agreement, the City became contractually obligated to pay the cost 6 of any disability retirement which James E. Michael might thereafter 7 become entitled to as a result of the physical impairment discovered 8 at the physical examination given by the County of Orange in 9 accordance with the Agreement. 10 (e) On December 13, 1982, James E. Michael received a service - 11 connected disability retirement from Claimant Orange County Employees 12 Retirement System. Said disability retirement was due to a work - 13 related aggravation of the physical impairment which existed as of the 14 time Mr. Michael was given a medical examination by the County of J � oZo; 15 Orange. As of December 13, 1982, the City became contractually woo LL;� 16 obligated, pursuant to the Agreement, to pay the cost of a 0Z 'og 17 service -connected disability retirement allowance for James E. 18 Michael, and hold Claimant free and harmless from any liability for 19 payment of disability retirement benefits to said James E. Michael. 20 The actuarial equivalent cost of paying such disability retirement 21 benefits to James E. Michael, calculated as of the effective date of 22 his service -connected disability retirement, totals $134,943.68. This 23 is the amount which City became contractually obligated to pay 24 Claimant, pursuant to the terms of the Agreement, as of December 13, 25 1982. N 2 26 (f) Claimant, acting through its authorized agents, has made ry N 0 27 timely request to officials of the City to pay the amount due and LL ® 28 owing, but said officials of the City have not yet made payment. 3. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 J y x ~ LL 2 2 15 p]7 wo ° LL y W 16 LL " 0z 00 17 U 18 19 20 21 22 23 24 25 N 26 N N O 27 ® 28 (g) The failure of the City to pay the amount due and owing constitutes a material breach of the Agreement between the City and the Claimant, Exhibit "A" hereto. The contractual obligation which forms a basis for this claim first arose on December 13, 1982, and this claim is presented within one year after the accrual of the cause of action. IV. WHEREFORE, Claimant requests that this claim be granted, and that the City pay Claimant the sum of $134,943.68, plus interest on said sum at the legal rate from December 13, 1982 until the date said sum is paid. Dated: December 12-, 1983 Respectfully submitted, ADRIAN KUYPER, COUNTY COUNSEL and DONALD H. RUBIN, DEPUTY By Donald H. Rubin, Deputy Attorneys for Claimant 4. AGREEMENT RELATING TO MEMBERSHIP OF THE CITY OF SAN JUAN CAPISTRANO IN THE ORANGE COUNTY EMPLOYEES RETIREMENT SYSTEM THIS AGREEMENT is entered into as of the first day of November, 1975, by and between the CITY OF SAN JUAN CAPISTRANO, hereinafter called "CITY," and the BOARD OF RETIREMENT OF THE ORANGE COUNTY EMPLOYEES RETIREiMENT SYSTEM, hereinafter called "BOARD." W I T N E S S E T H: WHEREAS, CITY is a "District" within the definition of Section 31468 of the Government Code (County Retirement Law of 1937), and is, accordingly, eligible to participate in the Orange County Employees Retirement System pursuant to said Law; and WHEREAS, CITY has, by its resolution dated July 16, 1975, and passed by a four-fifths vote, authorized participation in the aforesaid retirement system, and to make contributions on behalf of its officers and employees for the acquisition of credit for prior public service; and WHEREAS, all of CITY'S officers and employees, who are prospective members of the Retirement System, have had no public service other than as officers and/or employees of the CITY or agencies which are members of the state Public Employees' Retire- ment System (PERS); and WHEREAS, BOARD is willing to accept the aforesaid membership of CITY in the Orange County Employees Retirement System on the conditions specified below. NOW, THEREFORE, CITY and BOARD hereby agree that officers and employees of the CITY shall become members of the Orange County Employees Retirement System, effective November 1, 1975, subject to the following terms and conditions: 1. All of CITY'S officers and/or employees shall be subject to medical approval of the County as determined by the results of physical examinations, and if any shall be found medically unqualified, CITY agrees, in consideration of member- ship of such person, to keep and hold the BOARD free and harm- less from any liability for disability claims that may arise as a result of the aforesaid medical reasons, except to the extent of the employee's contributions. If an employee becomes entitled to a disability retirement allowance arising out of the condition for which the County deemed him or her unqualified, the CITY will be liable for all amounts of such retirement allowance, including survivor benefits and death benefits not funded by the employee and employer's contributions. 2. CITY shall pay to the BOARD the sum of $41,003.00 plus 7.940 of the total compensation paid from July 1, 1975, to November 1, 1975, in consideration of the right of CITY'S officers and employees to credit for their prior service with the CITY of San Juan Capistrano. A list of the officers and employees together with the length of known prior service and actuarial calculations representing current sums required to EXHIBIT A purchase such prior service is set forth in Exhibit "A" attached -hereto and made a part hereof. CITY shall pay to BOARD an additional sum for any expediture of funds which may arise because of the prior public service of any listed officer or employee other than that set forth on Exhibit "A", and for such other sums as may be found to be due and owing because of actuarial adjustments to the entire schedule of the retirement system. CITY shall reimburse BOARD for any expenditure of funds which may arise because of any officer or employee having been a member of a. public agency other than the CITY or PERS, and for such other sums as may be found to be due and owing because of actuarial adjustments to the entire schedule of the Retire- ment System. 3. Schedule of Payments: In lieu of the payment of the sum of $41,003.00 on the first day of the month following the effective date of this Agreement, the CITY may make payments in accordance with the following schedule until the principal amount of $41,003.00 is paid in full: On the first day of the month following action by the BOARD, the sum of not less than $8,200.60, and on each succeeding anniversary date a sum of not less than $8,200.60 plus interest on the balance of the amount remaining to be paid at the rate of the interest assumption rate in effect on the date of the payment. 4. All contributions and administrative charges assessed by the BOARD to be made by the CITY for the CITY and its officers and employees shall be made promptly and in strict accordance with the rules and regulations of the BOARD on or before the tenth day of each month. CITY OF SAN JUAN CAPISTRANO te: October 23, 1975 ATTEST: MARY ANN H NOVER, CITY LE APPROVED AS TO FORM: O C JAMES S. OKAZAKI, lJ City Attorney By......... BOARD OF RETIREMENT OF THE ORANGE COUNTY EMPLOYEES RETIREMENT SYSTEM B p Bradley r. Gates, vice Chairman Date: %d 30'7-, —T -2- EXHIBIT_ IPA SAN J ddpp '�P.STRMp i )X1 O! UA92675 JJ a December 23, 1983 Tom Bogdan Retirement Administrator Retirement Division Office of Tax Collector/Treasurer County of Orange P. O. Box 4515 Santa Ana, California 92702-4515 Re: Reimbursement of Pavments - James Dear Mr. Bogdan: :-Connected Disabilit Enclosed are the original and one copy of the Agreement for reimbursement of service -connected disability payments for James Michael between the Orange County Employees Retirement System and the City of San Juan Capistrano. The Agreement was approved by the City Council at their meeting of December 20, 1983. Please sign and date both copies and return the "City" copy to this office; the second copy is for your files. Thank you for your cooperation. Very truly yours, MARY ANN NOVER, CMC City Clerk MAH/mac Enclosures cc: David L. DeBeauvais 3. APPROVAL OF AGREEMENT FOR REIMBURSEMENT OF SERVICE -CONNECTED DISABILITY RETIREMENT PAYMENTS (JAMES MICHAEL/ORANGE COUNTY EMPLOYEES RETIREMENT SYSTEM)(38-#450) () Written Communications: *fS8) Additional Agenda Item dated December 20, 1983, from the Senior Administrative Assistant, forwarding an agreement between the City and the Board of Retirement of the Orange County Employees Retirement System for reimbursement to OCERS of costs involved in the disability retirement of former employee James Michael. The total cost, including principal and 74% accrued interest on the declining balance, is $163,282.05. Council authorized re -payment based upon a negotiated five-year schedule of approximately $32,650 per annum; the first installment payment is due January 1, 1984, and continues at six-month intervals until July 1, 1988. Funds have been budgeted within the debt service account, and are payable through the General Fund. Approval of Agreement: It was moved by Councilman Schwartze, seconded by Councilman Hausdorfer and unanimously carried to approve the agreement and authorize payment to the Orange County Employees Retirement System in accordance with the terms therein. The Mayor and City Clerk were authorized to execute the Agreement on behalf of the City. ia1 aolg3 • • AGENDA ITEM December 20, 1983 TO: Stephen B. Julian, City Manager FROM: David L. DeBeauvais, Senior Administrative Assistant SUBJECT: Reimbursement of Service -Connected Disability Retirement Payments -- James Michael SITUATION: As Council is aware, the City is liable for a disability retirement payment to Orange County Retirement System (OCERS)for a former employee, James Michael. On December 12, 1982, the Orange County Employees Retirement System (OCERS) found James Michael to be eligible for a service -connected disability retirement allow- ance, with an effective date of May 27, 1981. Furthermore, it was the finding of the OCERS that, due to a contractual agreement between the City and the OCERS, the City is liable for the present value of Mr. Michael's retirement allowance of $134,943.68 (excluding interest). City liability for these costs arises due to an agreement made when the City joined the OCERS that any employee at that time who was found to be medically unqualified for employment (according to OCERS standards) would nevertheless be accepted into the System. However, if such employee were later to receive a disability retirement due to such medical reasons, the City would reimburse the OCERS for costs involved. Attached is the formal agreement setting forth the retirement obligation. FINANCIAL CONSIDERATIONS: The total cost for reimbursement, including principal and 7 1/4% accrued interest on the declining balance, is $163,282.05. Council has authorized re -payment based upon a negotiated five year schedule of approximately $32,650 per annum. The first in- stallment payment is due January 1, 1984 and continues thereafter at six months intervals until July 1, 1988 (more specifically shown in attached Agreement). Costs for reimbursement have already been budgeted for within our debt service account, and are funded through the General Fund. ALTERNATE ACTIONS: 1. Approve the attached Agreement and authorize reimbursement in accordance with the negotiated re -payment schedule. 2. Authorize one reimbursement payment of approximately $135,000.00 to the OCERS. 3. Direct staff to re -negotiate a revised re -payment schedule. FOR G"'Y t'sDUW, _.1i AGENDA o �dv:naN�� �4�3 Lam; 0 f AGENDA ITEM -2- December 20, 1983 Reimbursement of Service -Connected Disability Retirement Payments -- James Michael ---------------------------------------------------------------------------------- ---------------------------------------------------------------------------------- RECOMMENDATION: Approve and execute the attached Agreement, and authorize payment to the OCERS in accordance with the terms therein. Respectfully submitted, David L. DeBeauvais Attachment