The County's goal is for all employees to pay half the normal cost for retirement and retirement COLA. The County provided us with a detailed spreadsheet documenting how our contributions would go up for each of us. The Total Pensionable Income column in the spreadsheet is merely a snapshot from Pay Period 2017-18, which includes Deputy Duty Pay for two members.
See Attachments from County.
Our members who are in Plan 8 are not impacted since those members are already paying half their cost. For the rest of the membership, since our retirement contribution is based on age of entry and plan, the increased contributions differ by person and plan. For instance, the younger you entered the retirement system, the lower your contributions.
This is just the County's initial proposal. We have not agreed to this. We are asking for more information such as how the County arrived at these numbers and how other employee groups will be impacted.
The County is open to off-setting the increase in contribution with a salary increase. Whether the County will match dollar for dollar is unknown. The County is also open to spreading out the increases in contributions over several years. This spreadsheet is designed to show the complexity of the issue -- that the increases vary widely. Some of us are hit harder than others. Thus, we have to come up with a counter-proposal that will be fair to us as an organization as a whole.
If we refuse to accept any increases it possible that we will reach impasse and the County will merely impose.
In PP 14 your retirement contributions will go up. This is a result of the trigger mentioned in Section 14 B of our MOU. (see below). The County did fail to meet and confer prior to making the increase. It turns out the County failed to meet and confer with all the Associations. On August 7, 2017 we will meet with the County to discuss the rate changes, albeit late. The looming issue will be the re-opener in September to discuss further rate increases and salary increases. Please let me know if you want to be part of those negotiations.
B. The County may adjust the employee contribution rates to the Contributory
Retirement Plans when such adjustments are based on an Actuary Report,
recommended by the Retirement Board and approved by the Board of
Supervisors. Prior to implementing employee contribution rate adjustments,
the County shall give notice and upon request provide an opportunity to
meet. The purpose of the meeting will be to discuss the implementation of
the contribution rate changes. The effective date of the rate adjustments
shall be in accordance with the applicable provisions of the County
Employees Retirement Law of 1937.
28 members voted all in favor of ratification. 28-0.
We reached a tentative agreement with the County today. I have attached a PDF summary of the key terms to this post. tentative-agreement-11-21-16
We would like to meet at noon on Wednesday to discuss it via video conference. I understand some of you will be gone. If you cannot make it, please call Lee or I with questions. If we are going to ratify this agreement we need to do so by November 28, 2016 in order to get it on the COSB Supervisors Agenda for 12-13-16. Our first raise goes into effect upon board approval.
I will set up an on-line vote. We will all have until Monday, November 28 to vote.
Term: 2.5 years
Salary: 2 % upon board approval, 2.5% in July 2017, and 2.5% in July 2018.
Professional Expenses: Increased to $500 per year with no carry over. Existing balances eliminated. Use of the funds will no longer be limited to training, but will now include software, hardware, and any and all materials and equipment that will make you a better prosecutor.
Deputy Duty Pay: Increased from $450 to $800.
Grievance Policy added to MOU.
Dear Department Directors:
As you may have heard, the SBCERS Board of Retirement recently voted to change its actuarial assumptions, which determine our pension contribution. Specifically, they reduced the assumed rate of return from 7.5% to 7.0% (a 0.50% or 50 basis point reduction). The SBCERS Board takes final action on the County’s required contribution in December.
Our Budget Will be Significantly Affected
· We have estimated this change will increase the County’s pension payment by $11 million next year, which will annually increase to over $30 million (possibly up to $45 million if wage increases are factored in) by the fifth year. These numbers are similar in magnitude to what the County experienced in the recent Great Recession This will significantly affect our budget. We are waiting for the exact increase by retirement plan from the SBCERS staff, which is expected this week.
It’s clear that the investment environment has changed, and consideration of a lowered rate of return is warranted, given that the pension fund only earned 0.8% and 1.4% in the last two years. The BOS requested that SBCERS lower the rate in a gradual manner (25 basis points now; 25 basis points again in 3 years) to help ease the impact on County services, residents and employees. By a 5-3 vote (with Supervisor Wolf in the minority), the SBCERS Board voted to lower the rate to 7% in one year, rather than in the requested, gradual approach. The County also asked that the SBCERS Board to delay its decision by one month, to give the County time to review the impacts, but the SBCERS Board was not able to grant that request.
How the County will Address this Impact: Fiscal Re-Balancing and Restructuring
· At our next Department Director meeting on November 18th, we will discuss this challenge before us. I’m relying on your leadership, expertise, innovation and commitment to the County to help me identify and execute actions to close the gap. These actions will include service level reductions next year and at least, the subsequent following four years, unless there are changes to the pension impacts or new revenue into the County.
· We will also start a series of meetings with our employees and labor groups to discuss the forecast ahead. On the November 15, 2016 Board Hearing, we will be providing the Board with the First Quarter budget update and also a status on the pension issue.
· I ask that you start thinking about what can be done in your departments and countywide, immediately for next fiscal year, and for subsequent years. Our delivery of County services will be impacted, and likely, be different than what we are delivering services today as we start this “Fiscal Re-balancing” initiative. This is just the beginning of discussions about the major changes we will need to make over the next five years. I’m counting on your ideas, suggestions and support as we lead our way through this challenge. Again, we will be discussing an approach to the reductions at our Department Directors meeting.
Please contact me if you have any questions.
County Executive Officer
County of Santa Barbara
105 E. Anapamu Street, Ste 406
Santa Barbara, CA 93101-2065
County budget in red with excessive spending, lower tax receipts
|By EMILY PARKER, NEWS-PRESS CORRESPONDENT
November 16, 2016 5:57 AM
The financial health of the county is looking bleak as at least one department is millions over budget and tax receipts are lower than projected.
By the end of this fiscal year, the Santa Barbara County could be looking at a $332,000 deficit in its general fund and an almost $6 million deficit in Mental Health Services, the Board of Supervisors was told Tuesday in an update on the fiscal 2016-2017 first quarter budget. The first quarter ended Sept. 30.
"It's early in the year. We still have a lot to see, so we hope to recover that," said Tom Alvarez, county budget director.
While 65 of the county's 68 funds are "on target or ahead of target," the others have "fairly significant" overspending, Mr. Alvarez said.
Mental Health Services has the largest deficit —projected to be in the red $5.9 million, he said.
The projected deficits are based on spending in the first quarter continuing throughout the year at the same rate, he said.
The overspending in Mental Health Services comes when the court says someone is "incompetent to stand trial" and sends them to the county's Psychiatric Health Facility.
The number of people sent from the court has increased and the length of stay has increased, costing the county extra money, said Dr. Alice Gleghorn, director of the county's Department of Behavioral Wellness.
"I know there's work being done, but this has been this way since we've been on the board," said Fifth District Supervisor Steve Lavagnino. "Our partners don't seem to be extremely helpful, and there's nothing we can do about it but pay the bill."
"We've got to get that under control somehow," said Fourth District Supervisor Peter Adam.
Dr. Gleghorn said she will continue to meet with judges to clarify how the court system uses the Psychiatric Health Facility.
In addition, the department had an unbudgeted $2 million of one-time capital costs and consulting fees, Mr. Alvarez said.
"It will be at the top of the list after the New Year as we talk about budget strategies," said County Executive Officer Mona Miyasato.
The Sheriff's Department is also in the red —about $695,000 over budget —mostly from overtime costs, Mr. Alvarez said.
"If the Sheriff salaries and employee benefits expenditures for the remaining three quarters continue at the same rate (1% over budget each quarter), costs could be as high as $4 million over budget (4%) for the fiscal year," Mr. Alvarez said in his report.
Spending too much on overtime is a "historic issue" for the Sheriff's Department, he said.
"We take this issue very seriously," Undersheriff Bernard Melekian told the supervisors.
A class of 10 will graduate the sheriff's academy in December, which should alleviate some of the overtime, Mr. Melekian said.
In addition, the county has received about $1.1 million less revenue than anticipated. Both property tax and transient occupancy tax are down, Mr. Alvarez said.
Looking ahead, increased pension costs could put the county well over budget. Over the next five years, the county must pay an extra $102.1 million above original projections because of a decrease in the assumed rate of return for its pension fund, he said.
In fiscal 2017-2018, the county will need to spend an additional $10.8 million on pensions, Mr. Alvarez said.
Federal, state and local funding could partially offset the increased pension costs.
County staff is estimating the county's budget gap for the next five years and will present the data to the supervisors in December.
"We've got to get that under control somehow."
Peter Adam, Fourth District supervisor
The County's counter proposal was a three year contract 1 %, 1.5%, and 1.5%, DDA Duty pay would be increased to $768, and the book fund would be increased to $325, but with no carry-over. This is less than what the County settled with the DPD's.
The County wants a retirement reopener on Sept. 1, 2017. The County is emphasizing the need for employees to pay more towards retirement.
The County rejected our proposals for vacation buy back, student loan forgiveness, and deferred comp.
We go back to the table on November 21.
Lee Carter, Stephen Foley, and our attorney, Stuart Adams, met with County negotiators on October 28, 2016 in Santa Barbara. We provided the County with our initial proposal of a two year agreement with raises of 2.5%, 3 %, and 3 %. We also asked for other contract improvements such as an increase in Extra Duty Pay.
We will meet with the County again on November 10 and November 21, 2016.