HomeMy WebLinkAboutCC Resolution 13557 (Retiree Benefit Trust Program)RESOLUTION NO. 13557
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL
PROVIDING FOR: (1) ADOPTION OF THE CALIFORNIA EMPLOYERS' RETIREE
BENEFIT TRUST PROGRAM (CERBT) FOR PRE -FUNDING THE CITY'S LONG-
TERM OBLIGATION FOR PROVIDING RETIREE HEALTH BENEFITS FOR
ELIGIBLE EMPLOYEES; (2) APPROVAL OF THE ASSET TRANSFER TO THE
CERBT; AND (3) DESIGNATING THE CITY MANAGER AND FINANCE DIRECTOR
OR DESIGNEES WITH THE AUTHORITY TO REQUEST AND RECEIVE
DISBURSEMENTS FROM THE CERBT FOR PAYMENT OF FUTURE RETIREE
HEALTH BENEFIT OBLIGATIONS
WHEREAS, the City of San Rafael provides post -employment medical benefits to
eligible retirees and their eligible dependents and survivors, and
WHEREAS, the City Council wishes to establish a trust to pre -fund these benefits, and
WHEREAS, California Public Employees Retirement System (CaIPERS) has the
California Employer's Retiree Benefit Trust Program (CERBT) for pre -funding the City's long-
term obligation for retiree health benefits and staff considered several possible alternatives and
believes that the CERBT best meets the City's needs for managing this long-term liability, and
WHEREAS, the City Council intends that the CERBT qualify as a trust for purposes of
Governmental Accounting Standards Boards ("GASB") Statement 43, pursuant to paragraph 4
of GASB 43, so that amounts held under the CERBT will be treated as offsetting the unfunded
OPEB liability that must be reported on the City's financial statements under GASB 45, and
WHEREAS, the City Council further intends that contributions and transfers to, and
earnings under, the CERBT be exempt from taxes to the maximum extent permitted by law, and
WHEREAS, the City Council wishes to begin pre -funding the City's OPEB liability by
transferring the current balance in the City's 401(h) fund held by the Marin County Employees'
Retirement Association ("MCERK) estimated to be $12 million.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of San Rafael
does resolve, declare, and determine and order the following:
SECTION 1. That the City Council hereby adopts the CERBT, substantially in the form
attached as Exhibit A:
Contributions to the trust will be irrevocable, and assets under the CERBT may
not be diverted for any purpose other than funding the City's OPEB liability,
unless and until all liabilities associated with those benefits are satisfied, and
all Trust assets will be irrevocably dedicated to, and will be used for the exclusive
purpose of, providing for payments of OPEBs and for paying expenses of
administering the CERBT, and will not be available to any of the City's creditors.
SECTION 2. That the City Council directs the City Manager to sign and thus enter into
the Participation Agreement Regarding City of San Rafael Retiree Medical Trust 401(h) Account
with MCERA ("Agreement"), attached as Exhibit B, and in accordance with the terms of the
Agreement hereby authorizes and directs MCERA to transfer as soon as administratively
practicable after the City's execution of the CERBT and the Agreement, the balance from the
City's 401(h) fund to the CERBT.
SECTION 3. That the City Manager and Finance Director, or designees are authorized
to request and receive disbursements from the CERBT for payment of future retiree health
benefit obligations and to certify as to the purpose for which the disbursed funds will be used.
I, Esther C. Beirne, Clerk of the City of San Rafael, hereby certify that the foregoing
Resolution was duly and regularly introduced and adopted at a regular meeting of the City
Council of the City of San Rafael, held on Monday, the 17th of June 2013, by the following vote,
to wit:
AYES: Councilmembers: Colin, Connolly, Heller, McCullough & Mayor Phillips
NOES: Councilmembers: None
ABSENT: Councilmembers: None
Esther C. Beirne, City Clerk