HomeMy WebLinkAboutStaff Report 2601-5789CITY OF PALO ALTO
CITY COUNCIL
Special Meeting
Monday, February 09, 2026
Council Chambers & Hybrid
5:30 PM
Agenda Item
9.Approve a resolution for an exception to the CalPERS 180-day waiting period to appoint
retired annuitant Aaron Miller; CEQA Status - Not a Project
City Council
Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Human Resources
Meeting Date: February 9, 2026
Report #:2601-5789
TITLE
Approve a resolution for an exception to the CalPERS 180-day waiting period to appoint retired
annuitant Aaron Miller; CEQA Status - Not a Project
RECOMMENDATION
Staff recommends that the City Council adopt a resolution, pursuant to Government Code
sections 7522.56 and 21224, approving an exception to the 180-day waiting period, set forth by
the California Public Employee Retirement System (CalPERS), to allow the appointment of
retired annuitant Aaron Miller to a temporary, part-time assignment to perform special-project
work of limited duration at the Regional Water Quality Control Plant, following completion of
the required 60-day bona fide separation from service.
BACKGROUND
The Regional Water Quality Control Plant (RWQCP) is undergoing a significant and complex
rebuild to modernize aging infrastructure (six major projects active) and ensure continued
regulatory compliance and service reliability. Aaron Miller, former Assistant Plant Manager
with 34 years of experience, overseeing the Maintenance Department, retired on December 31,
2025. Mr. Miller possesses unique, long-tenured knowledge of the plant’s underground piping
systems, mechanical infrastructure, and long-term maintenance strategies. His historical
knowledge is critical during this temporary transitional period.
CalPERS generally requires a 180-day waiting period post-retirement before a retiree may
return to work as a retired annuitant. Exceptions may be made if the governing body adopts a
resolution to waive the waiting period for separation and reviews the employment agreement.
The waiver allows an employer to hire a retired annuitant to perform work of limited duration.
ANALYSIS
The RWQCP rebuild is a complex, multi-year modernization effort that involves multiple
concurrent projects and ongoing interfaces between new construction and legacy systems. Mr.
Miller’s retirement has created a gap in specialized expertise that is needed to maintain
continuity and reduce operational and compliance risk during this critical phase of the work.
The City is requesting approval of an exception to the 180-day waiting period pursuant to
Government Code sections 7522.56 and 21224 to allow Mr. Miller to perform defined, limited-
duration Extra Help.
•Support capital project integration and operational reliability where new systems
interface with legacy infrastructure.
•Enhance regulatory readiness through operational readiness reviews at key milestones.
Readiness reviews will be completed prior to substantial completion and at turnover
milestones to support operational continuity and risk mitigation
•Accelerate onboarding and strengthening staff capacity through structured training and
knowledge transfer.
•Improve the transition of capital projects from construction to operations by supporting
commissioning close-out activities, such as completion of Operation and Maintenance
manuals, as-built documentation, spare parts verification, CMMS data loading, and asset
hierarchy development.
•Limited duration and project-based scope;
•Designation in a retired-annuitant Extra Help position;
•No retirement incentives or additional benefits, severance, or prearranged employment
agreement;
•Adherence to the 60-day bona fide separation period prior to reemployment when a
member retires prior to their normal retirement age; and
•Adherence to the 960-hour annual limit and appropriate rate of pay.
An anticipated duration is not to exceed two years (subject to earlier completion of project
milestones) - reflecting the expected timeline for completion of major RWQCP capital projects
and the associated knowledge-transfer activities.
Given the complexity and regulatory sensitivity of the RWQCP modernization, retaining Mr.
Miller for a defined, limited-duration period provides a strategic, cost-effective, and compliant
solution to support project success, strengthen staff capability, and preserve critical
institutional knowledge during a pivotal time for the plant.
FISCAL/RESOURCE IMPACT
Expenses associated with the limited term retired annuitant will be funded through vacancy
savings in the Wastewater Treatment Fund (Fund 526). Additionally, this assignment will not
impact partner agencies, as the cost will be absorbed within existing appropriations that were
already included in the approved operating budget.
If the Retired Annuitant assignment extends beyond the anticipated not to exceed two year
period or vacancy savings become insufficient, staff will evaluate available funding within the
Wastewater Treatment Fund and return to the City Council for any necessary budget
amendment or authorization.
STAKEHOLDER ENGAGEMENT
Staff in Human Resources and the Public Works Departments collaborated to ensure
compliance with CalPERS post-retirement employment provisions and the Public Employees’
Retirement Law. The employment agreement between Aaron Miller and the City of Palo Alto is
attached herein.
ENVIRONMENTAL REVIEW
Council approval of the resolution is exempt from California Environmental Quality Act (CEQA)
because it can be seen with certainty that approving the resolution will not result in any
environmental impacts.
ATTACHMENTS
Attachment A: Resolution for 180-Day Exception for Aaron Miller
Attachment B: Employment Agreement for Aaron Miller
APPROVED BY:
Sandra Blanch, Human Resources Director
RESOLUTION FOR 180-DAY WAIT PERIOD EXCEPTION
WHEREAS, in compliance with Government (Gov.) Code section 7522.56 of the Public
Employees’ Retirement Law, the City of Palo Alto must provide CalPERS this certification
resolution when hiring a retiree before 180 days has passed since their retirement date; and
WHEREAS, Aaron Miller (CalPERS ID 2242811828) retired from City of Palo Alto in the
position of Assistant Plant Manager Water Quality Control Plant, effective December 31, 2025;
and
WHEREAS, Gov. Code section 7522.56 requires that post-retirement employment commence
no earlier than 180 days after the retirement date, which is June 29, 2026 without this
certification resolution; and
WHEREAS, Gov. Code section 7522.56 provides that this exception to the 180-day wait period
shall not apply if the retiree accepts any retirement-related incentive; and
WHEREAS, the City Council, the City of Palo Alto and Aaron Miller certify that Aaron Miller has
not and will not receive a Golden Handshake or any other retirement-related incentive; and
WHEREAS, the City Council hereby appoints Aaron Miller as an extra help retired annuitant to
perform the duties of the Assistant Plant Manager Water Quality Control Plant for the City of
Palo Alto under Gov. Code section 21224, effective no sooner than March 1, 2026; and
WHEREAS, the entire employment agreement, contract or appointment document between
Aaron Miller and the City of Palo Alto has been reviewed by this body and is attached herein;
and
WHEREAS, no matters, issues, terms or conditions related to this employment and appointment
have been or will be placed on a consent calendar; and WHEREAS, the employment shall be
limited to 960 hours per fiscal year for all CalPERS employers; and
WHEREAS, the compensation paid to retirees cannot be less than the minimum nor exceed the
maximum monthly base salary paid to other employees performing comparable duties, divided
by 173.333 to equal the hourly rate; and
WHEREAS, the compensation paid to retirees cannot be less than the minimum nor exceed the
maximum monthly base salary paid to other employees performing comparable duties, divided
by 173.333 to equal the hourly rate; and
WHEREAS, the maximum base salary for this position is $222,372.80 and the hourly equivalent
is $106.91, and the minimum base salary for this position is $148,262.40 and the hourly
equivalent is $71.28; and
WHEREAS, the hourly rate paid to Aaron Miller will be $106.91; and
WHEREAS, Aaron Miller has not and will not receive any other benefit, incentive, compensation
in lieu of benefit or other form of compensation in addition to this hourly pay rate; and
THEREFORE, BE IT RESOLVED THAT the City Council hereby certifies the nature of the
appointment of Aaron Miller as described herein and detailed in the attached employment
agreement/contract/appointment document and that this appointment is necessary to fill the
critically needed position of Assistant Plant Manager Water Quality Control Plant for the City of
Palo Alto by March 2, 2026 because of the critical need to continue to the special project at the
Regional Water Quality Control Plant (RWQCP) to modernize aging infrastructure and ensure
continued regulatory compliance and service reliability.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
___________________________ ______________________________
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
___________________________ ______________________________
City Attorney City Manager
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EMPLOYMENT AGREEMENT
BETWEEN CITY OF PALO ALTO
AND
Aaron Miller
THIS AGREEMENT is between the City of Palo Alto, a municipal corporation and chartered city
("City") and Aaron Miller (“Miller”). It is effective on the latest date next to the signatures on the last
page.
This Agreement is entered into on the basis of the following facts:
A. City, acting by and through its City Council, hereby employs Miller as a Retired
Annuitant, subject to the terms and conditions set forth in this Agreement, the Palo Alto
Municipal Code and the Charter of the City of Palo Alto (the "Charter").
B. Whereas California Government Code Section 21224 of the Public Employees’
Retirement Law permits the governing body to appoint a CalPERS retiree to a Retired Annuitant
position without reinstatement from retirement if such appointment is necessary because the
retired person has specialized skills needed in performing work of limited duration.
Notwithstanding any provision of the City of Palo Alto Merit System Rules and Regulations, the
Retired Annuitant serves on an at-will basis, with no expectation of continued employment, and
with no right to pre-or post- separation due process or appeal.
C. Miller desires to be employed by the City as a Retired Annuitant, subject to the
terms and conditions in this Agreement, the Palo Alto Municipal Code, the Charter, the Palo
Alto Merit System Rules and Regulations, and all other applicable laws, resolutions, and policies.
D. The City and Miller wish to establish specific terms and conditions relating to
compensation and benefits and related matters.
BASED UPON THE FOREGOING, THE CITY AND MILLER AGREE AS FOLLOWS:
1.Employment. The City appoints Miller as a Retired Annuitant for a term not to exceed
24 months to begin on March 2, 2026. Except as otherwise provided therein, Miller’s employment
with the City shall be governed by the City Council adopted Compensation Plan for Limited Hourly
Employees, as it currently exists and may be changed from time to time.
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2.Duties of the Retired Annuitant. Miller will perform the duties established for the
Retired Annuitant by the Palo Alto City Charter, by the Palo Alto Municipal Code, by direction given
by the Public Works Director, and as otherwise provided by law, ordinance, or regulation. Miller
agrees to comply with all federal, state and local laws, ordinances, rules and regulations applicable to
or associated with these duties.
2.1.No Conflict. Miller will not engage in any employment, activity, consulting
service, or other enterprise, for compensation or otherwise, which is actually or potentially in
conflict with, or which interferes with the performance of their duties. Miller acknowledges
that they are subject to the various conflict of interest requirements found in the California
Government Code and state and local policies and regulations.
2.2.Permission Required for Outside Activities. Miller will not engage in any
employment, activity, consulting service, or other enterprise, for compensation or not,
without written permission of the City Council.
3.Salary. While performing the duties of Retired Annuitant, Miller will receive a base
salary within the range provided in the City Council-approved Compensation Plan for Limited Hourly
Employees, as it currently exists and may be changed from time to time. Miller will receive an hourly
base rate of one hundred six dollars and ninety-one cents ($106.91) per hour, beginning on March 2,
2026. This amount is subject to authorized or required deductions and withholding, prorated, and
paid on the City's regular paydays. Miller is a non-exempt employee under applicable wage and hour
law.
4.Benefits and Allowances. Pursuant to Gov Code California Government Code
Section 21224, Miller shall not receive any benefit, incentive, compensation in lieu of benefits, or
other form of compensation in addition to the hourly pay rate.
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5.Duration of Employment. Miller understands and agrees that they have no
constitutionally protected property or other interest in their employment as a Retired Annuitant.
Miller waives any and all rights, if any, under the Merit System Rules and Regulations, including
without limitation, the right to pre-or post-disciplinary due process. Miller understands and agrees
that they work at the will and pleasure of the City and that they may be terminated or asked to resign
at any time, with or without cause. Miller may terminate this agreement (terminating all
employment) upon 30 days’ written notice.
6. Miscellaneous.
6.1.Notices. Notices given under this Agreement shall be in writing and shall be
either: a) served personally; or b) sent by facsimile (provided a hard copy is mailed within one
(1) business day); or c) delivered by first-class United States mail, certified, with postage
prepaid and a return receipt requested; or d) sent by Federal Express, or some equivalent
private mail delivery service. Notices shall be deemed received at the earlier of actual receipt
or three (3) days following deposit in the United States mail, postage prepaid. Notices shall be
directed to the addresses shown below, provided that a party may change such party's
address for notice by giving written notice to the other party in accordance with this
subsection.
CITY: Attn: Human Resources
250 Hamilton Avenue, Palo Alto CA 94301
Phone (650) 329-2376
Miller, Aaron
250 Hamilton Avenue, Palo Alto CA 94301
Phone (650) 329-2470
6.2.Entire Agreement/ Amendment. This Agreement constitutes the entire
understanding and agreement between the parties as to those matters contained in it, and
supersedes any and all prior or contemporaneous agreements, representations and
understandings of the parties. This Agreement may be amended at any time by mutual
agreement of the parties, but any such amendment must be in writing, dated, and signed by
the parties and attached hereto.
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6.3.Applicable Law and Venue. This Agreement shall be interpreted according to
the laws of the State of California. Venue of any action regarding this Agreement shall be in
the proper court in Santa Clara County.
6.4.Severability. In the event any portion of this Agreement is declared void, such
portion shall be severed from this Agreement, and the remaining provisions shall remain in
effect, unless the result of such severance would be to substantially alter this Agreement or the
obligations of the parties, in which case this Agreement shall be immediately terminated.
6.5.Waiver. Any failure of a party to insist upon strict compliance with any term,
undertaking, or condition of this Agreement shall not be deemed to be a waiver of such term,
undertaking, or condition. To be effective, a waiver must be in writing, signed and dated by the
parties.
6.6.Representation by Counsel. Miller and the City acknowledge that they each did,
or had the opportunity to, consult with legal counsel of their respective choices with respect to
the matters that are the subject of this Agreement prior to executing it.
6.7.Section Headings. The headings on each of the sections and subsections of this
Agreement are for the convenience of the parties only and do not limit or expand the contents of
any such section or subsection.
Miller, Aaron City of Palo Alto
Approved as to Form:
City Attorney’s Office