1983-1220_OC EMPLOYEES RETIREMENT SYSTEM_Agreementi
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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:
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"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
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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
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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
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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
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4.
CITY OF SAN JUAN CAPISTRANO
"CITY"
ATTEST:
CITY CLFK ��=�.//l/L-t--•�
APPROVED AS TO FORM:
IT�R�Y ��
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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.
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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 �"
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Adrian Kuyper, County Counsel
and Donald H. Rubin, Deputy
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10 Civic Center Plaza
P. O. Box 1379
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Santa Ana, California 92702
Telephone: (714) 834-3357
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III.
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The facts and circumstances giving rise to this claim are as
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follows:
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(a) Effective November 1, 1975, Claimant and the City of San
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Juan Capistrano (hereinafter "City") entered into a written agreement,
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a true and correct copy of which is attached hereto as Exhibit "A" and
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incorporated by reference herein as though set forth in full.
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Pursuant to said Agreement, employees of the City became members of
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Claimant retirement system. The attached Agreement, Exhibit "A"
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hereto (hereinafter "Agreement") sets forth certain terms and
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conditions by which City would pay its proper share for providing
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retirement benefits to City employees.
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(b) At the time the Agreement was entered into and became
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effective, one James E. Michael was an active employee of the City.
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By law, and by the provisions of the Agreement and the resolution of
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the City authorizing the Agreement, said James E. Michael became a
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member of Claimant Orange County Employees Retirement System effective
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November 1, 1975.
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(c) At or about the time the Agreement became effective, James
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E. Michael was given a physical examination by the County of Orange,
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in accordance with the terms of the Agreement. As a result of this
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examination, James E. Michael was found to be suffering from a
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physical impairment which would have disqualified him from similar
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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
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employment with the County of Orange, or would have required him to
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sign a waiver pursuant to Government Code Section 31009 prior to
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becoming employed by the County of Orange.
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(d) Pursuant to the foregoing, and pursuant to the provisions of
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the Agreement, the City became contractually obligated to pay the cost
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of any disability retirement which James E. Michael might thereafter
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become entitled to as a result of the physical impairment discovered
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at the physical examination given by the County of Orange in
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accordance with the Agreement.
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(e) On December 13, 1982, James E. Michael received a service -
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connected disability retirement from Claimant Orange County Employees
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Retirement System. Said disability retirement was due to a work -
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related aggravation of the physical impairment which existed as of the
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time Mr. Michael was given a medical examination by the County of
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Orange. As of December 13, 1982, the City became contractually
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obligated, pursuant to the Agreement, to pay the cost of a
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service -connected disability retirement allowance for James E.
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Michael, and hold Claimant free and harmless from any liability for
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payment of disability retirement benefits to said James E. Michael.
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The actuarial equivalent cost of paying such disability retirement
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benefits to James E. Michael, calculated as of the effective date of
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his service -connected disability retirement, totals $134,943.68. This
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is the amount which City became contractually obligated to pay
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Claimant, pursuant to the terms of the Agreement, as of December 13,
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1982.
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(f) Claimant, acting through its authorized agents, has made
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timely request to officials of the City to pay the amount due and
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owing, but said officials of the City have not yet made payment.
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(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
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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