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Home My WebLink About03.e. Approve Proposed Resolution 2024-XXX and Amendment to CCCSD 401(A) Plan Approved on July 25, 2024Page 1 of 5 Item 3.e. BOARD OF DIRECTORS POSITION PAPER MEETING DATE: NOVEMBER 19, 2024 SUBJECT: REVI EW DRAFT POSITION PAPER TO APPROVE PROPOSED RESOLUTION 2024-XXX TO AMEND THE CENTRAL CONTRA COSTA SANITARY DISTRICT 401(A) PLAN TO REFLECT THE TERMS OF THE AMENDMENT TO THE EMPLOYMENT AGREEMENT WITH THE GENERAL MANAGER APPROVED JULY25, 2024 SUBMITTED BY: INITIATING DEPARTMENT: KEVIN MIZUNO, FINANCE MANAGER ADMINISTRATION -FINANCE REVIEWED BY: PHILIPLEIBER, DEPUTYGM -ADMINISTRATION ROGER S. BAILEY, GENERAL MANAGER ISSUE Board approval is required to amend the Central Contra Costa Sanitary District 401(a) Plan ("Plan") to reflect the amendment to the Employment Agreement with the General Manager approved by the Board on July 25, 2024. BACKGROUND On J my 25, 2024, the Board adopted the Sixth Amendment to the Employment Agreement with the General Manager, which took effect on J my 26, 2024. 1 n addition to extending the employment contract term and salary adjustments, the amended agreement provides for a mandatory employee pre-tax salary reduction contribution of twelve and one-half percent (12.5 percent) of the General Manager's salary to the Plan. To ensure Plan compliance with I RS rules and regulations, a Plan amendment, authorized through the Board's adoption of the attached Resolution (Attachment 1), is required by the close of calendar year 2024 to provide for this new contribution. This Amendment amends Appendix A to the Plan Adoption Agreement to reflect this new mandatory contribution. ALTERNATIVES/CONSIDERATIONS The Board's adoption of the attached Plan amendment is necessary to maintain the Plan's tax -qualified status and is therefore recommended. The Board has already adopted the Sixth Amendment to the Employment Agreement with the General Manager to contractually provide for the new contribution, and this amendment is necessary to align the Plan provisions with the General Manager's amended Employment Agreement. November 19, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 221 of 230 Page 2 of 5 FINANCIAL IMPACTS There are no direct financial impacts to Central San attributable to adopting the Plan amendment. All mandatory contributions to the Plan stipulated by this plan amendment are funded by employee, not employer, contributions and thus have no direct impact on Central San's budget. COMMITTEE RECOMMENDATION The Finance Committee reviewed this matter at its November 19, 2024 meeting and recommended RECOMMENDED BOARD ACTION Adopt proposed Resolution 2024-xxx (Attachment 1) to amend the Plan to reflect the terms of the amended Employment Agreement with the General Manager providing for a mandatory employee contribution of twelve and one half percent (12.5 percent) of salary to the Plan. GOAL THREE: Workforce Diversity and Development Strategy 3 - Retain skilled workers by investing in resources and opportunities for all employees to grow and thrive ATTACHMENTS: 1. Proposed Resolution 2024-XXX November 19, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 222 of 230 Page 3 of 5 Attachment 1 RESOLUTION NO. 2024-XXX A RESOLUTION OF THE BOARD OF DIRECTORS OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT AMENDING THE CENTRAL CONTRA COSTA SANITARY DISTRICT 401(A) PLAN WHEREAS, the Central Contra Costa Sanitary District (the "Employer") has adopted the Central Contra Costa Sanitary District 401(a) Plan (the "Plan"), which was most recently restated effective as of February 1, 2022; and WHEREAS, Section 14.01 of the Plan authorizes the Employer to amend the Plan; and WHEREAS, the Employer wishes to amend the Plan to provide for required mandatory contributions for the General Manager. NOW, THEREFORE, IT BE RESOLVED, that effective as of July 26, 2024, the Employer hereby amends the Plan as follows: 1. Appendix A to the Plan is amended to read in its entirety as attached hereto. PASSED AND ADOPTED this 5th day of December, 2024 by the Board of Directors of Central San by the following vote: AYES: Members: NOES: Members: ABSENT: Members: Mariah N. Lauritzen President of the Board of Directors Central Contra Costa Sanitary District County of Contra Costa, State of California I: oll]01921:&9[e7►12193 Katie Young, CPMC, CMC Secretary of the District Central Contra Costa Sanitary District County of Contra Costa, State of California Approved as to form: J. Leah Castella, Esq. Counsel for the District November 19, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 223 of 230 Page 4 of 5 APPENDIX A CENTRAL CONTRA COSTA SANITARY DISTRICT 401(A) MONEY PURCHASE PLAN & TRUST COVERED EMPLOYMENT CLASSIFICATIONS Section V — Covered Employment Classifications: Employees in the following classifications are eligible to participate in the Plan: Employees who are represented by the Employees' Association, Public Employees Union, Local 1 (Local 1), the Management Support/Confidential Group (MS/CG), and the Management Group (Management), Unrepresented At -Will Employees (Unrepresented At -Will), and the General Manager. CONTRIBUTIONS Section V1.1.A — Fixed Employer Contributions: The Employer shall contribute to the Plan each payroll period on behalf of each Participant hired by the Employer before April 1, 1986, the equivalent of the Social Security maximum (Employer portion), including the Medicare percentage, and for each Participant hired on or after April 1, 1986, the Social Security maximum (employer portion) excluding Medicare percentage. For the General Manager only, the Employer shall also contribute to the Plan for the 2021 Plan Year a one-time contribution of $33,423.50. The Employer shall contribute $400 each month to the Plan on behalf of each Participant who is not enrolled in Employer -provided group health plan coverage because the Participant is enrolled in other group health plan coverage. Section V1.1.13 — Required Mandatory Contributions: Effective April 18, 2022, Participants who are Unrepresented At -Will Employees shall be required to contribute Required Mandatory Contributions by pre-tax salary reduction picked up by the Employer equal to the percentage of base pay specified in the table below: Employee Attributes as of 2022 Unrepresented Contribution Salary Resolution Adoption Date: Annual compensation exceeding $250,000 12.5% of base pay each pay period Annual compensation exceeding $200,000, but not 8% of base pay each pay exceeding $250,000 period Annual compensation of less than $200,000 2% of base pay each pay period Commencing with the 2024 Plan Year, allow for a mandatory employee contribution of twelve and one half percent (12.5%) of the General Manager's salary to the Plan. November 19, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 224 of 230 Page 5 of 5 Appendix A — Page 2 of 2 TERMINAL COMPENSATION Section XIII — Final Pay Contributions: A portion of each Participant's Terminal Compensation shall be contributed by the Employer upon termination of the Participant's employment with the Employer based on the Participant's Bargaining Group as follows: Bargaining Group Terminal Compensation Portion of the Participant's Terminal Compensation to be Contributed by the Employer Local 1 More than $10,000 50% Between $5,000 and 25% $10,000 0% Less than $5,000 MS/CG, Management, and Not specified 100% Unrepresented At -Will For purposes of this Appendix A, the term Terminal Compensation shall mean a Participant's accrued unused vacation, sick leave, earned overtime, and holiday comp pay (to the extent of the amount any of the preceding are payable to employees upon termination per the relevant MOU or resolution). November 19, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 225 of 230