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Home My WebLink About0333.095• 1'0: FROM: ·.c.' . -_,to ;·:>"':·"O~ .. -:::::.". ': '.-.-' .. ,f ..... " .'-' o City of Palo Alt9 City :Manager's Report HONORABLE CITY COUNCIL CITY MANAGER DEPARTMENT: num •• Resource. AGENDA DATE: luly 1D,199S CMR: 3J;J:9S SUBJECT: Implementation oCtile provisions oCSectio. 414(loXl) atlll.lateraal Reve.u. Cod. OD bell.1f oC Local 1319, liter. ationa! Association of Fir.figiten of th. City of Palo Alto. REOUEST This request is roc implementation or the City agreement ... ith IAFF l<>caI 1319 enacting provisioos of Section 414(1l)(2) or the IIiternal Revenue Code (IRe) aDow'dlg roc PERS retiremenl .,..tem COIltn1>utioos designated as an employ • .: contribution, which are deducted from employee salaries, to be treated for tax putposeS as employer contributions. RECOMMENDATIONS This report recommends that Council adopt a Resolution implementing the provisions of Sectioo 414(lt)(2) ofll>e Internal Revenue Code on behalf of miscellaneous and safety members repsesenled by l<>caI 1319, WF of the City or Palo Alto. POLICY IMPlJCATIONS This request does 001 represent any cbanges or existing poIkies. EXEClmVE SUMMARY On February 11,1995, the City Council approved an agreement w;!h l<>caI 1319, In\ernatiooal Association of Firefighters, roc the period of July 23, 1994 -June 30, 1997. Part of this agreement provhled roc PFRS member contributions to be made as all<>wcd under provisions ofIRC Code Seroon 414(hX2). This provision bas the effect or deferring \aXB1ioo or member (employee) contributions until retirement benefits are received. Page I of 2 ---,~-~~.--.--,-~~:-;;--:.-,--. -:-'""' ~.'.::;. . <)~:t::' .. >~_ : ._.~. < ,c' .,_ . , A .. ...... No new fiscal impact. Funding has been provided in the 1995-96 budget. ENVIRONMENTAL ASSr.AAMENI This is DO( • project fur the purposes of the California Environmental Quality Act. ATIACHMENTS I. Resmution of ln1ention PREPARED BY: Leonard Zucker ces CITY MANAGER APPROVAL: hg<lol2 . :--......----.-..... .-,--- A .... t9 i<ESOLU'l'ION NO. IIBSOWTIOI!! OF THE COUNCIL OF 'l'Hl!=ccc""r""TY OF PALO ALTO IMPLEMENTING THB PROVISIONS OF SEC~ION 41((Hil2} OF THE INTERNAL RBVENtTB COOE ON BEHALF OF LOCAL SAFBTY AND MISCELLANEOCS MEMBBRS REPRESENTeD BY LOCAL 131!f, nl'I'ER.'1ATIONAL ASSOCIATION OF FII1.B FIGHTERS OF THE CIT'{ OF PALO ALTO WHEREAS, the City of .Palo Alto has the authority to 1:roplemen-t t.he provisions of Section 414 (b) {2J of t.he Internal Revenue Cooe (IRC I: ar.-d W".dEP..EAS... the Board of Administration of the Public Employees" Retirement System adopt-Ecd its resolution regarding Section 41((h) (2) on September 18, 19~5; and WHEREAS, the Internal Revenue S~rvice has stated on Oecenlber 6. 1985, tha.t the implementation of the provisions of Section 4-14. (h) (2) of the IRe pursuant to the resolut.ion of the Board of Administration ~ould satisfy the legal requirements of Section 414 (h) (2) of the IRe: and WHBRBAS, the City of Palo Alto has determined that even though tbe implementation of the provisions of section '1~rn)(2) of the LRC is DOC required by la~~ the tax benefit offered by Section 414 (h} 12) of the IRe should be provided to its employee members of Local 1319. International Association of Fire Figbters, who are local safety and miscellaneous members of the PUblic Employees~ RetiremeJl,t System; The Council of the City of Palo Alto does hereby RESOLVE as follows : SECTIQN 1. The City of Palo Alto -will implement. the provisions of Section 41.rh) (2) of the Internal Revenue Code by malting employee cootributlons pursuant to California Government Code section 20615 to the Public Employees' Retirement System on behalf ot its ell'ployee meabers of Local 1319.. International Association of Fire Fighters... who are local safety and miscellaneous members of the PUblic Employees· Retir~ent System (the rdesignated en-ployees·}. -Employee contributions· shall mean t't..ose eontribltions to t.he itublic Employees· Retirement System which are deducted fran the salary of employees and are credit.ed to individual emplcyees~ aceounts pursuant to California Government Code section 20615. SECTION 4. The contributions made by the City of Palo Alto to the Public Employeea~ Retirement System~ although designated as employee CODtributiaas l are being paid by the City of palo Alto in lieu of contributions by the designated employees~ who are members of the Public Employees~ Retirement System. 1 ...... : ,<~ \-:'.4~~~! . . ,--:-" . SECTION 3. The designated employees ehall :DOC have t:he option of choosing to receive the contributed a.mounts directly insteado! having them paid by the City of Palo .uto to the Public Employees· Re~iremen~ System. E~. The City Of Palo .uto shall pay to the Public Employees' Retirement System the contributions designated as employee coctributions from the same s~rce of funds as used in paying salary. SECTION 5~ Tbe amount of the contributions designated as employee .contributions and paid by the City of Palo ~to to the Public Bmploye:ea" Retirement., System on behalf of a designated employee E~l be the entire contri~~tion required ~f the employee by the Public 8mployee9' ~etlrerrent Law <california Government Code section 2000~ et seq.). SECTION 6. The coott'ibutions designated as employee coctributirulS Jnade by the City of Palo Alto to the Public Employees· Retirement System shall be txeated for all pur;poses. other than taxatiOD~ in t.he same way that member contributions are treated by the Public Ernployees r .Retirement Syst~. SECTION '1 ~ This is not. a project for purposes of the California Environmental Quality Act (·CEQA·) .. INTRODUCED AND PASSED, AYES: IiOBS , ABSBNT: ABSTENTIONS , ATTEST: Ci~y Clerk APPl!OVED AS TO FORM: Senior Asst. City Attorney ,~.,0031l31 2 APPROVED, Mayor City Manager Oirector of Administrative Services Director of ~~ Resources " "::., ;..:',.-'-