HomeMy WebLinkAbout11.d. Presentation on CCCERA formulas for calculating employer and employee contribution rates Page 1 of 5
Item ll.d.
Central Contra Costa Sanitary District
March 15, 2018
TO: HONORABLE BOARD OF DIRECTORS
FROM: TEJI O'MALLEY, HUMAN RESOURCES MANAGER
REVIEWED BY: ANN SASAKI, DEPUTY GENERAL MANAGER
ROGER S. BAILEY, GENERAL MANAGER
SUBJECT: RECEIVE PRESENTATION ON CONTRA COSTA COUNTY EMPLOYEES'
RETIREMENTASSOCIATION (CCCERA) FORMULAS FOR CALCULATING
EMPLOYER AND EMPLOYEE CONTRIBUTION RATES
Please see the attached PowerPoint presentation, which will be given at the Board meeting.
ATTACHMENTS:
1. CCCERA Formulas Presentation
March 15, 2018 Regular Board Meeting Agenda Packet- Page 256 of 275
CCCERA FORMULAS
r
EMPLOYERFOR CALCULATING
•
CONTRIBUTION
Teji O'Malley, Human Resources Manager
i
• • Meeting
March 15, 2018
BACKGROUND
Administration
Committee requested
methodology utilized by January 12,2018:
Contra Costa County Committee reviewed Today:
Employees'Retirement methodology utilized by Presentation of
Association(CCCERA) CCCERA and Fiscal information to the Board
to determine employer Year 2017-18 rates
and employee
contribution rates
MICD
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CCCERA
• Governed by
• California Constitution (Article 16 — Public Finance,
Section 17)
• County Employees Retirement Law of 1937 (CERL)
• California Public Employees' Pension Reform Act of 2013
(PEPRA)
• Internal Revenue Code
• Other state and federal laws
• Determines contribution rates by formulas set forth
within CERL
• Section 31676.16 for employers
• Section 31676.11 (Legacy) and Section 7522.20 (PEPRA)
for employees
L
THREE COMPONENTS OF
CONTRIBUTION RATES
1. Employer Normal Costs
(Basic and the Cost of Living Adjustment (COLA))
The amount of contribution required by the employer to fund
the cost allocated to each year of service.
2. Employee Normal Costs (Basic and the COLA)
The amount of contribution required by the employ to fund
the cost allocated to each year of service.
3. Unfunded Actuarial Accrued Liability (UAAL) The
difference between the actuarial accrued liability of the plan
and the assets of the plan.
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March 15, 2018 Regular Board Meeting Agenda Packet- Page 258 of 275
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FORMULAS TO DETERMINE EMPLOYEE "NORMAL COSTS"
Legacy • Basic share: Must provide for an average annuity at age 60
equal to 1/120 of the projected final average salary(FAS)
• Cost-of-Living: Half of future Cost-of-Living costs
• Any normal costs that remain after the employee share is calculated is
borne by the employer.
• For the Fiscal Year 2018-19 rates,the split is-60%to the employer and
-40%to the employee.
• Any COLA adjustments are split evenly amongst the employee and
employer.
PEPRA • Half of the total Normal Cost rate
• Employee and employer normal costs are split evenly between the two
parties.
FISCAL YEAR 2017-18 RATES
FY 2017-18 Pension Contribution Rates Normal Unfunded Actuarial
(expressed as a percentage of payroll) Costs Accrued Liability(UAAL)
Legacy Employer(Basic and COLA) 17.08°l0 36.31%
Legacy Employee Basic and COLA 11.85% 0%
PEPRA Employer Basic and COLA 11.70% 36.31%
PEPRA Employee Basic and COLA 11.70% 0%
Calandar Year 2016 OPEB Expense
Normal Costs 1 $2,325,000.00
Expense per Employee 1 $7,881.36
FY 2017-18 Fringe Benefits
(expressed as a percenta a of payroll)
Exclusive of OPEB Normal Costs 31.89°%
Inclusive of OPEB Normal Costs 36.97%
Total District Benefit Cost as a Percentage of Payroll
Employee Type BenefitCost Cost Calculation
Le ac Em la ee 56.05% 38.97%+17 06°0
PEPRA Employee 60.67% 1 38.97%+11.70°0
UAAL for All Employees 36.31
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March 15, 2018 Regular Board Meeting Agenda Packet- Page 259 of 275
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QUESTIONS?
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March 15, 2018 Regular Board Meeting Agenda Packet- Page 260 of 275