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HomeMy WebLinkAbout06.a.4. REQUEST FOR DATA FROM CONTRA COSTA COUNTY EMPLOYEES' RETIREMENT ASSOCIATION (CCCERA)6.A.~~ Central Contra Costa Sanitary District May 5, 2010 TO: HONORABLE BOARD OF DIRECTORS VIA: JAMES M. KELLY, GENERAL MANAGER~~~~""`5 p FROM: RANDALL M. MUSGRAVES, DIRECTOR OF ADMI//NISTRATION /~~ SUBJECT: REQUEST FOR DATA FROM CONTRA COSTA COUNTY EMPLOYEES' RETIREMENT ASSOCIATION (CCCERA) The District sent CCCERA a letter requesting de-pooling data and/or a commitment to allow sufficient time to receive and review de-pooling data prior to the CCCERA Board taking action. This matter was discussed at today's CCCERA Board meeting. I am pleased to report that the CCCERA Board understood the District's request, and the other employers need to receive, evaluate, or audit Segal's work and provide input to the CCCERA Board prior to action by them. They committed to such a process and directed CCCERA Retirement Chief Executive Officer Marilyn Leedom to send a letter to all employers notifying them of their decision. Ms. Leedom was clear with the CCCERA Board that their current policy and practice is to release the data only after the Board had received Segal's report. The CCCERA Board maintained the policy by committing to employers that after the CCCERA Board receives de-pooling information from Segal, CCCERA will release the information to the employers fortheir review, and CCCERA will provide adequate time for employers to provide input to the CCCERA Board prior to any final action. The CCCERA Board envisions multiple meetings and opportunities to discuss de-pooling impacts among themselves and with the employers. On May 17, 2010, a CCCERA Board Special Meeting will be conducted to receive information from Segal and CCCERA staff regarding the ability to de-pool at the employer level or if the data can only support de-pooling to the Tier, or retirement benefit, level. That meeting should provide a better understanding of the issues affecting the ability to de-pool at the employer level. Said differently, CCCERA is reconsidering whether to de-pool at the employer or tier le"vel. This decision will affect the information they provide us as well as the employer contribution rates we pay CCCERA. Staff will continue to report to the District Board the results of the de-pooling meetings. cc: James M. Kelly, General Manager Elaine Boehme, Secretary of the District Kenton Alm, District Counsel Daniel Clinton, District Labor Attorney (~,a,y~ Central Contra Costa Sanitary District April 29, 2010 TO: HONORABLE BOARD OF DIRECTORS VIA: JAMES M. KELLY, GENERAL MANAGER FROM: RANDALL M. MUSGRAVES, DIRECTOR OF ADMINISTRATION /`~~ SUBJECT: REQUEST FOR DATA FROM CONTRA COSTA COUNTY EMPLOYEES' RETIREMENT ASSOCIATION (CCCERA) Attached is the latest letter sent to CCCERA Retirement Chief Executive Officer, Marilyn Leedom, dated April 22, 2010. Her response, dated April 23, 2010, is also attached. The District's request for data and/or a timely review process will be submitted to the Board in their May 5, 2010 agenda packet. The de-pooling review process is to be discussed at that CCERA Board meeting. Staff will report to the Board at our May 6, 2010 meeting. A Closed Session item is listed in case the Board desires to discuss desired action(s) to obtain the requested data. As you know, the CCCERA Board directed their staff and Actuary, Segal Company, on October 14, 2010, to develop the necessary data and information to de-pool by employer. At that time, Segal anticipated submitting their report to the Board in December, 2009. The report was submitted to the CCCERA Board and discussed at their January 13, 2010 meeting. The report identified that the District's employer contribution rate would rieed to increase by 3.94%, or approximately $1,000,000 annually. District staff had communicated to Ms. Leedom the need for the District to audit Segal's work. A letter dated January 28, 2010, also attached, was sent to Ms. Leedom, to formalize the emails and phone conversations regarding the need to audit Segal's data, calculations, assumptions and methodology. Again, staff will report to the Board at the May 6, 2010 meeting. The Board can then determine if a Closed Session is needed. Central District FAX: (925) 228-4824 January 28, 2010 KENTON L ALM Counsel ror MeD/sMCf (5f0J 80&1000 JAMES M.' KELLY General Manapef ELA/NE R. BOEHME Ms. Marilyn Leedom secreraryarrneo/srna Retirement Chief Executive Officer Contra Costa County Employees' Retirement Association 1355 Willow Way, Suite 221 Concord, CA 94520 rf~~~ RE: CONTRA CO COUNTY EMPLOYEE'S RETIREMENT SYSTEM DE-POOLING STUDY Dear Ms: The Central Contra Costa Sanitary District (the District) philosophically agrees with de-pooling and the transparency it brings for the public. The District does have a responsibility to our ratepayers to ensure the de-pooling is accomplished equitably. The District has received a copy of the Segal Company's January 6, 2010 letter summarizing the results oftheir de-pooling study. We would like to receive more information on the detail of Segal's calculations and assumptions. Please note that the District is seeking enough information to allow us to have an outside actuary review Segal's calculations and assumptions for reasonableness of both method and results. At this time we requesting the data Segal used to arrive at their results. We would like to understand the following: 1. What was the District's stand alone December 31, 2002 Unfunded Actuarial Liability (UAL) and how did that Unfunded Actuarial Liability change as it was brought forward to December 31, 2008? 2. Is the UAL the only component of the District's estimated 3.94% rate increase? The information we receive may also lead to other questions. If you and/or the Segal Company have any questions about the requested or needed data, please call (925-229-7305) or have the Segal Company directly contact Mr. John Bartel (650-377-1601). As an additional note, we understand the Segal Company is presenting the last of their analysis at the Board's second February meeting. We'd like to request that the Board not take action until we have had time to review the calculation detail. This analysis might take 3-4 weeks after we get the requested information. Sincerely, es M. Kelly eneral Manager cc: Randall Musgraves, Director of Administration s:.,.~.,i r.,..~ District PNO,VE: (923)128-9300 FAX.' (923) 676-72 / l April 22, 2010 www.cen/rn/san.org JAhf6:S M. KF.'LLY Ms. Marilyn Leedom reneml MonaRer Chief Executive Officer XF.N7T)N I..ALN Contra-Costa County Employees' Retirement Cuunae(fur the Disrcin ~s,o/eon-~ooo Association C'LAINF.'R ROF.'N.NE 1355 Willow Way, Sude 221 Stcrocnry nflhe Uislrin Concord, CA 94520 Dear Marilyn: Since the Contra Costa County Employee's Retirement Association (CCCERA) Board determined to de-pool at the employer level in October 2009, the Central Contra Costa Sanitary District (CCCSD) Board and staff have requested information developed by CCCERA's Actuary, Segal Company, on de-pooling. A preliminary report was produced by Segal and presented to the CCCERA Board. In that report, Segal's work indicates that CCCSD's rates may need to increase by 3.9% or $1,000,000 annually. CCCSD staff has requested the data Segal used for developing the report from CCCERA so as to confirm the work done by Segal. You have informed me that the District can only receive the data specifically for the District's active and retired employees and/or beneficiaries, with confidential information removed. You also stated that no billable hours by Segal could occur without CCCERA Board approval. To date, the District has not been provided with any information necessary to ensure the District's allocations and rate adjustment are accurate and appropriate. The District has contracted with John Bartel to assist the District with its review. Mr. Bartel needs the following data and information to audit Segal's de-pooling calculations and to review Segal's de-pooling methodology. 1. December 31, 2008 CCCSD Valuation data; 2. December 31, 2002 Unfunded Actuarial Accrued Liability (UAAL) calculation, including: • CCCSD contribution components from the December 31, 2002 valuation, Payroll information used to allocated UAAL at December 31, 2002; 3. CCCSD specific information from December 31, 2002 through December 31, 2008, including: • Benefit payments by year • Cohtributions paid by year, separately for Normal Cost and UAAL; 4. CCCSD December 31, 2008 separate valuation results, including: • Actuarial Accrued Liability • Normal Cost • Allocated Plan Assets; 5. December 31, 2002 CCCSD Valuation data A ~, Recycled Paper Request for De-pooling Information from Segal April 22, 2010 Because of the significant impact de-pooling could have on the District, I am requesting sufficient time be provided to evaluate and audit the data, assumptions, and methodology used by Segal Company before the CCCERA Board takes final action. The CCCSD Board has supported transparency of retirement benefits for the public and has stated that the District should pay its cost for retirement benefits. The Board feels strongly that the District has a fiduciary responsibility to District rate payers to ensure a fair allocation of costs to the District due to the de-pooling. The District is prepared to take any necessary actions to ensure we meet our fiduciary responsibilities. The District needs to either receive the requested data and information in a timely manner or receive a commitment from the CCCERA Board that a process allowing an audit of Segal's work by employers before the CCCERA Board makes a final decision will be followed. I am requesting a response to our data request and need for adequate time to provide the CCCERA Board comments regarding de-pooling by Thursday, April 29, 2010. This is after your CCCERA's April 28, 2010 Board meeting and before CCCSD Board meeting of May 6, 2010. I need to reiterate that the CCCSD Board has strongly expressed their dissatisfaction with the inability to receive the data needed to meet their fiduciary responsibility. Sincerely, Randall M. Musgraves Director of Administration cc: Central Contra Costa Sanitary District Board of Directors Kenton Alm, District Counsel Daniel Clinton, District Labor Counsel J ~~~ `G ~~ Emp yes' FdetirementAssociation 1355 willow way suite 221 concord ca 94520 925.521.3960 fax 925.646.5747 April 23, 2010 Randall M Musgraves, Director of Administration Central Contra Costa Sanitary District 5019 Imhoff Place Martinez, CA 94553-4392 Re: Request for Actuarial Da[a Dear Randy: We are in receipt of your letter dated April 22, 2010 requesting specific data and information to audit Segal's depooling calculations and methodology: As you are aware, our Board discussed the data issues involved with the depooling as the March l0, 2010 meeting. At that meeting, alternative approaches were discussed for the depooling process. The Board set up an open ad-hoc committee to discuss and consider depooling options. Because this was to be discussed at an open meeting, the Board Chair later approved setting a Special Board meeting to discuss options with The Segal Company, and to invite all employer groups to attend. At the Special Board meeting (date still to be determined), the Board will discuss options regarding dates of implementation, possible changes to previously approved methodology, and how the data available would affect these options. Although it may be premature [o release the requested information and approve direction to The Segal Company to work with Mr. Bartel, we will add your letter as a discussion item for the May 5, 2010 CCCERA Board meeting. Please contact me with any questions regarding this matter. Sincerely, f~ ~~ Marilyn Leed Retirement Ch' f Executive Officer cc: Board of Retirement The Segal Company Agenda Item 6.a.5) Board Meeting of May 6, 2010 Written Announcements: Events/Meetings a) Public Workshou For Hall Drive Sewer Renovations (Phase 2B), DP 5932 The District will host a public workshop at 7 p.m. on Wednesday, May 12, 2010 at Orinda Intermediate School located at 80 Ivy Drive. The Hall Drive Sewer Renovations (Phase 2B) project will renovate 2,600 linear feet of 6-inch sewer lines within public right-of-way and easements by using horizontal directional drilling, pipeburst, and open cut methods. b) District Annexation 178 Mailing and Community Meeting A community meeting on this issue will be held at 7 p.m. on Wednesday, May 26, 2010, at Round Table Pizza located at 504 Center Avenue in Martinez. Staff will discuss the impacts and process for the annexation with the owners of affected properties, and property owners and residents of the area surrounding the parcels proposed to be annexed. This meeting is part of the extensive outreach program for annexations that was developed in consultation with Contra Costa lAFCO. A letter inviting participation in the meeting will be mailed to 453 property owners and residents during the week of May 10, 2010. Staff Travel c) Kathleen West Attending the IRWA 56th Annual International Education Conference As Vice President of the local Chapter 2 of the International Right of Way Association (IRWA), one of Senior Right-of-Way Agent Kathleen West's responsibilities is to attend the Annual Education Conference along with the Spring and Fall Forum. All costs associated with attending the meeting, including airfare, registration, food, and lodging are paid by the association. The only District expense is her time to attend. The conference will have a direct use and benefit to the District, which includes invaluable networking with other IRWA chapters and professionals, promoting and supporting the local IRWA chapter, and .attending numerous educational sessions (right of way ethics, eminent domain updates, professional development, utilities, and international committee meetings). It is anticipated that she will'be able to apply the new knowledge and insight to her current, and future positions and responsibilities. d) Gail Chester Attending United States Environmental Protection Agency Technology Transfer Seminar Associate Engineer Gail Chesler will be attending the U.S. Environmental Protection Agency (EPA) Technology Transfer Seminar -Nutrient Control at Municipal Wastewater Treatment Plants in Seattle, Washington on May 11 and 12, 2010. Ms. Chesler will be attending to gather information regarding updated, state-of the-art technology design on nitrogen and phosphorus control at municipal wastewater treatment plants and environment impacts of nutrients. Her expenses will be covered under the Environmental Services Division technical training and conferences O&M budget.