Loading...
HomeMy WebLinkAboutItem 8.2 Amend DRFA JPA CITY CLERK File # 600-40 AGENDA STATEMENT CITY COUNCIL MEETING DATE: October 2, 2001 SUBJECT: Third Amendment Dougherty Regional Fire Authority Joint Exercise of Powers Agreement Report Prepared by Richard C. Ambrose, City Manager ATTACHMENTS: 3. 4. 5. Dougherty Regional Fire Authority Joint Exercise of Powers Agreement First Amendment to Joint Exercise of Powers Agreement Second Amendment to Joint Exercise of Powers Agreement Agenda Statement (June 5, 2001) Item 5.1 Resolution Authorizing and Directing Mayor to Sign Third Amendment to DOugherty Regional Fire Authority Joint Exercise of Powers Agreement RECOMMENDATION: 1. Receive Staff presentation Adopt Resolution authorizing and directing Mayor to sign Third Amendment to Dougherty Regional Fire Authority Joint Exercise of Powers Agreement FINANCIAL STATEMENT: There will be limited costs to the City in connection with the Amendment to the Joint Exercise of Powers Agreement and to reconstitute the Board as the two City Councils. Should the Board decide to amend the contract with PERS to provide enhanced retirement benefits or to terminate the contract with PERS, there will be financial impacts to the City, which will be addressed at that time. DESCRIPTION: On July 24, 2001, the City Council met in a joint meeting with the San Ramon City Council to discuss whether the two City Councils were interested in amending the Dougherty Regional Fire Authority Joint Exercise of Powers Agreement (JEPA) to change the composition o£the Board of the Dougherty Regional Fire Authority (DRFA) to enable the DRFA Board to provide enhanced retirement benefits to former employees. The consensus of the members of the two City Councils was to consider such an amendment to the JEPA. H/cc-f0rms/agdastmt. doc COPIES TO: ,mm ITEM NO. ~ The JEPA was first entered into in 1988 (Attachment 1). The JEPA has twice been amended by the First Amendment (Attachment 2) and the Second Amendment (Attachment 3). Staff has drafted a Third Amendment to the JEPA (Exhibit A of Attachment 5)° The Third Amendment makes two major changes to the JEPA, as amended. The first change is to designate the full City Councils of both Cities as the Board of the DRFA. When originally adopted in 1988, the Board of DRFA consisted of three (3) members of each City Council. When the Second Amendment was adopted in 1997, the Board was reconstituted as the two (2) City Managers° The second change would be to give the Board the aUthority to amend the contract between DRFA and the Public Employee Retirement System (PERS) to provide enhanced retirement benefits to former employees of DRFA and to authorize the Board to terminate the agreement with PERS. The Third Amendment to the JEPA does not require the Board to take such actions; rather, it merely authorizes the Board, should it wish, to take these actions. On June 5, 2001, the City Council considered a request from Local 55 of the International Association of Firefighters to provide increased retirement benefits (PERS 3% ~ 50) to former employees of DRFA (Attachment 4)~ The June 5, 2001, staff report notes that the anticipated cost to the two Cities of providing the 3% at 50 benefit, as of June 1999, was $1,304,706. This staff report also notes the accumulated monies which will be available for distribution to the two CitieS should the Board of DRFA decide to terminate the contract with PERS. The Third Amendment would delegate most administrative actions to the Management Committee, which consists of the City Managers of the two cities. Thus, if the Board decided to amend the PERS contract to provide enhanced retirement benefits or to terminate the contract with PERS, the Management Committee would then handle all administrative matters related to those decisions, unless a statute requires action by the governing body, which is the Board. Similarly, other administrative matters would be handled by the Management Committee, such as resolution of any remaining workers' compensation claims. It is possible that the Board may need to meet to take some actions, such as the annual adoption of a resolution setting the amount of DRFA's contribution towards retiree medical premiums. If the two City Councils decide in the future that they wish to delegate all administrative matters to the two City Managers, a further amendment of the JEPA would be required. Recommendation: Staff recommends that the City Council receive the Staff presentation and adopt the resolution (Attachment 5) authorizing and directing the Mayor to sign the Third amendment to the JEPA. The City Council of San Ramon considered this item at its meeting of September 25,2001, and approved the Third Amendment to the JEPA. If approved by the Dublin City Council, the Third Amendment will take effect when signed by both mayors. A meeting of the DRFA Board is tentatively scheduled for October 9, 2001, in San Ramon at 6:00 p.m, assuming the Third Amendment is approved. G:\Central Services\DRFA~,DRFA Agenda Statement 10-2002.doc JOINT E_~ERCISE OF POWERS AGKEEMENT DOUGHERTY REGIONAL FIRE AUTHORITY THIS AGREEF-ENT is entered into on the effective date hereinafter set forth by and between the member agencies signatory hereto (hereinafter "Member Agencies"). W I T N E S S E T H: hMEEtLEAS, Title 1, Division 7, Chapter 5 of the Government code of the State of California authorizes said Member Agencies to enter into agreement for the joint exercise of any power common to them; and WHEREAS, said Member Agencies possess the power to orovide for fire protection and suppression services within their respective jurisdictions; and WHEtLEAS, the jurisdictional areas of the Member Agencies are contiguous to each other, are developed to substantially the same level of density, and are susceptible to being, provided with fire protection services and facilities under common administration and management and with the same equipment, resources and per~onne!; and WHEtLEAS, the separate management and administration of each jurisdictional area by each of the respective agencies and using separat~e equipment, resources and personnel will result in duplication of effort, inefficiencies in a~ministration and excessive costs, all of .which, in'the judgment of the agencies, _ .. ATTACH54ENT ! can be eliminated, all to the substantial advantage and benefit of the citizens and taxpayers of both agencies, if the administration and management of the fire protection facilities and services employing common equipment, resources and personnel were to be consolidated in a single p.ub!ic agency; and such is the purpose of this Agreement; NOW, THEREFORE, FOR AND It{ CONSiDERATION OF THE PREMISES, THE MUTUAL ADVANTAGES TO BE DER/V~D THEREFROM AND IN CONSIDERATION OF THE MUTUAL COVENANTS HEREIN CONTAI/TED, IT IS : AGREED BY AND BETWEEN THE PARTIES HEtAETO AS FOLLOWS: ARTICLE I DEFINITIONS Unless the context otherwise requires, the words and terms defined in this Article shall, for the purpose hereof, have the meaning herein specified. Section 1.!. Act. "Act" means Article 1 and Article 2 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the Government Code of California. Section 112. ~reement. "Agreement" means this join't exercise of powers agreement. Section 1-3. Area. "Area". and ~jurisdictiona! area" mean that.-area within the corporate limits of the City of Dublin and the City of San Ramon as they now exist or may hereafter exist and not within the jurisdictional area of any other fire protection district. -2- Section 1.4. ~' "Authority" means the.Dougherty Regional Fire Authority created pursuant to this Agreement. Section 1.5. Board~ of Directors. "Board of Directors" means the governing board of the Dougherty Regional Fi~e Authority referred to in Section 1.4. section 1.6. Bond Law. "Bond Law".means Article 2 of Chapter 5, Division 7, Title 1 of the California Government code, as now or hereafter amended, or any other law hereafter legally available for use by the A~{hority in the authorization and issuance of bonds to finance needed public facilities- Section 1.7. B_ytaw~s- =Bylaws" refers to the operational and organizational directives of'the joint powers of the Dougherty Regional Fire Authority- Section 1.8- Chief Executive officer. "Chief Executive officer" means the chair of the Management Committee- Section 1.9. Controller/Treasurer' =C°ntr°ller/Treasurer~ means the Financial Director and Finance Manager of the Authority having the responsibility and accountability of the Auth6rity's fundS-- Section 1.10. Fire chief. "Fire Chief= means the employee of the Authority directly responsible to the Management Committee and primarily responsible for the managerial oversight 'of the operations of the Authority- · Section ~.11. Fiscal Year. "Fiscal Year" means the period from July 1st to and including the following June 30th.' -3- Section !.!1. Fiscal Year. "Fiscal Year" means the period from July 1st to and including the following June 30th.. Section 1.12. Joint Facilities. "Joint Facilities" means all existing fire protection facilities, equipment, resources, and property to be owned, managed and operated by the-Authority pursuant to Section 5.3 hereof, and, if and when acquired or. constructed, any improvements and additions thereto. Section 1.13. Legislative Bodies. "Legislative Bodies" means the city councils or elected representatives of the Member Agencies of the Authority. Section 1.14. Management Committee. "Management Committee" means the City hanager of each of the Member Agencies of the Authority. Section 1.15. Member Agencies or Agency. "Member Agencies" means both public agencies signatory to this Agreement. "Member Agency" means any such party. Section 1.16. Quorum. "Quorum" means a majority of the Board of Directors, but in no case less than two (2) person~ from each Member Agency, necessary to conduct business. ~ection !.!7[' Secretary. "Secretary" means the Secretary of the Dougherty Regional Fire Authority. ARTICLE II GENERAL PROVISIONS Section 2.1. Purpose. This Agreement is made pursuant to tb~ Act providing for the joint exercise of powers common to the Agencies. The purpose of this Agreement is to provide for the joint,exercise of powers to own, manage, operate and maintain the Joint Facilities as they now exist and to implement the financing, acquiring and constructing of additions and ~ improvements thereto and additional facilities and property and thereafter to manage, operate and maintain the Joint Facilities, as so added to and improved, all to the end that the Area is provided with more efficient and economical fire protection service, and, if necessary, to issue a~d repay revenue bonds of the Authority .pursuant to the Bond Law. Each of the Agencies is authorized to exercise all such powers (e~cept the power to issue and repay revenue bonds of the Authority) pursuant to its or§anic law and the Authority is authorized to issue and provide for the repayment of revenue bonds pursuant to the provisions of the Bond Law. Section 2.2. Creation of Authority. Pursuant to the Act, there is hereby created a public entity to be known as the "Dougherty Regional Fire Authority", herein called the "Authority"- The Authority is a public entity separate and apart from the City of Dublin and the City of San Ramon and ' shall administer this Agreement. The Authority may be commonly referred to as th% "Dougherty Regional Fire Department". Section 2.3. Effective.Date of Agreement. This Agreement shall become effective when signed and executed by both Member Agencies. Section 2.4. Operational Date of AGreement. This Agreement shall become operational on July !, 1988, or the effective date of the Authority's-contract with the Public Employees Retirement System, whichever occurs later. -5- Section 2.5 Schedulin~ of Transition. After the effective date of this Agreement and prior to the operational date, the Board of Directors shall adopt a schedule of performance .outlining the transition of services, personnel, equipment, and capital facilities to the Authority. The Management Committee created by this Agreement shall be responsible for the implementation of said schedule of performance sufficient to meet the operational date. Section 2.6. Term. This Agreement shall be effective on the date hereof and shall continue in effect until such time as all bonds (if any) and the interest thereon issued by th'e Authority under the Bond Law or the Act shall have been paid in full or provision for such payment shall have been made and thereafter until such time as the Authority and the Agencies shall have paid all sums due and owing pursuant to this Agreement or pursuant to any contract executed pursuant to this Agreement, and thereafter until terminated pursuant to Article VIII. Section 2.7. Governing Board. The Authority shall, be administered by ~.Board of Directors consisting of six (6) members. Three (3) members shall be Council members of the City of Dublin and shall be appointed by the City Council of the City of Dublin, and three' (3) members shall be Council members of the City of San Ramon and shall be appointed by the City Council of the City of San Ramon. Each City Council shall appoint an alternate Board member from the City Council who may act in the absence of a member appointed by that City Council. The Board of Directors shall be called the "Board of Directors of the 'Dougherty Regional Fire Authority". Allovoting power of the Authority shall reside with the Board of DireCtors. (a) Ail Board members shall serve at the pleasure of the Agency that appointed such member. (b) Ail vacancies on the Board shall be filled by the appointing entity within thirty (30) days of the vacancy. Each Director s~a!l cease to be a member of the Board of Directors when such member ceases to hold office as a councilmember of the appointing entity. (c) Members shall receive compensation and-- reimbursement for reasonable and necessary expenses incurred in performance of their duties, as provided in the Bylaws. Section 2.8. Meetings of the Board of Directors. Ail meetings of the Board of Directors shall be public meetings unless a specific closed session is held in accordance with the Government Code- (a) Regular Meetings. The Board of Directors sh'al! provide for regular meetings at a date, time, and place fixed by resolution of the Board of Directors which shall be at least quarterly. Cb) ~pecial Meetinqs. Special meetings of the Board of Directors may be called in accordance with the provisions of Section 54956 of the California Government Code, for.the purpose of taking immediate action for emergency measures, as necessary- (c) Call, Notice, and Conduct of Meetings. Ail meetings of the Board of Directors, including without limitation, regular, adjourned regular, and special meetings, shall be called, noticed, held, and conducted in accordance with the provisions of Sections 54950, et seq., of the California Government Code. Section 2.9. Reauired Votes; Approvals. The affirmative votes of at least two members of each Agency shall be required to take any action by the Board of Directors and less than a quorum may adjourn from time to time. Section 2.10. VotinG. Each member of the Board of Directors shall have one vote. Section 2.11. Minutes. The Secretary shall cause to be kept minutes of the meetings of the Board of Directors and shall, as soon as possible after each meeting, cause a copy of the minutes to be forwarded to each member of the Board of Directors and to each Member Agency. Section 2.12. Bylaws. The Board of D~rectors may a~opt, from ~ime to time~ such bylaws, -rules, and regulations for the conduct of its meetings and affairs as are necessary for the purposes hereof. ARTICLE III ORGANIZATIONAL STRUCTURE ~. OFFICERS AND EMPLOYEES Section 3.1. Chairperson and Vice-Chairperson. The Board of Directors shall elect a Chairpgfson and Vice-Chairperson from -S- among its members- The Chairperson and Vice-Chairperson.shall rotate f~om each Member Agency annually such that the Chairperson and Vice-Chairperson shall not be appointed from the same Member Agency. In the event of the disqualification or permanent inability to serve as the Chairperson d~ring the year, another member from the same Agency shall be appointed Chairperson to fulfill the one-year term. (a) The Chairperson shall sign all contracts on behalf of the Authority and shall perform such other duties as may be imposed by the Board of Directors. (b) The Vice-Chairperson shall act, sign contracts, and perform all of the Chalroerso s duties in the temporary absence of the Chairperson. Section 3.2. Secretary. The Chief Executive Officer shall be the Secretary to the Board and shall countersign all contracts signed by the Chairperson or Vice-Chairperson on behalf of the Authority, perform such other duties as may b&' imposed by the Board of Directors and cause a copy of thi~ Agreement to be f~ied with the Secretary of State and the State of California pursuant to Section 6503.5 of the Act. Section 3.3. Controller/Treasurer- The Contro!!er/T~easurer of the Authority shall be designated in the Bylaws. ~he Controller/Treasurer shall be the depository and shall have custody of all of ~he accounts, funds and money of the Authority from whatever so~rce. The Controller/Treasurer -shall have the duties and obligations set forth in Sections 650S -S- and 6505.5 of the Joint Exercise of ?owers Act of the California Government Code, and shall assure that there shall be strict accountability of all funds and reporting of all receipts and disbursements of the Authority. Section 3.4. Officers in Charge of Property. ?ursuant to Section 6505.6 of the California Government Code (Joint Exercise of Powers Act), the Control!er/Treasure~ shall have charge of, handle, and have access to all accounts, funds, and money of the Authority and all records of the authority relating thereto; and the Secretary shall have charge of, handle, and have access to all other records of the Authority; and the Management Committee shall have charge of, handle, and have access to all physical properties of the Authority. Section 3.5. Bondinq Persons Earing Access to Property. From time to time, the Board of Directors may designate persons, in addition to the Secretary, Controller/Treasurer, and Management Committee, having charge of, handling, or having access to any property of the Authority. The Board of DirectSrs shall also designate the respective amounts of the offici~t bonds'of the Secretary, Controller/Treasurer, and of the Management Committee members and such other persons pursuant to SectiQn 6505.1 of the California Government Code (Joint Exercise cf ~owers Act). Section 3.6. Management. The regular management of the ~or!ty shall be vested jointly ~n the Management Committee. The Board of Directors shall annually appoint a Chairperson of the Management Committee who shall be designated as the Chief -10- Executive Officer of the Authority and a Vice-Chairperson of the Management Committee who shall act in the absence of the Chief Executive Officer. The Chief Executive Officer shall be rotated annually such that the Chief Executive Officer is from the same Agency as the Chairperson of the Board. The Management Committee shall have the power: (a)To provide for the piannihg, design, and construction of any additions or improvements to the Joint Facilities operated by the Authority; (b) Except'as otherwise provided in clause-(h) of this Section, to execute any contracts for capital costs, costs of special services, equipment, materials, supplies, maintenance, or repair that involve an expenditure by the Authority within the limits and in accordance with procedures to be established by the Authority in the manner .provided for local agencies pursuant to Article 7, commencing with Section 54201 of .Chapter 5 of-- ?art 1 of Division 2 of Title 5 of the California (c) (a) Government Code; To appoint and.employ all personnel of the Authority required for maintenance and operation of the Joint Facilities, including a Fire Chief, and all other employees authorized by the Authority's budget or by the Board Of Directors; To retain any consu!kants, including labor relations consultants or certified public -!!- accountants, as authorized in the Authority's budget; (e) Subject to approval of the Board of Directors, to appoint and employ all personnel of the Authority or consultants require~ to be employed or retained in connection with the design of any additions, or improvements of the Joint'Facilities or construction of new Joint Facilities; (f) To expend funds of the Authority and enter into contracts, whenever required in the combined judgment of'the Management Committee, or for the immediate preservation of the public peace, health, or safety; (g) To sell any personal property of the Authority as may be provided in the Bylaws; (h) To approve demands for payments by the Authority of Five Thousand Dollars ($5,000.00), or less, which are authorized in the budget; (i) To prepare and submit to the Board of'Directors in tike for revision and adoption by it prior to March ! of each year, the annual preliminary budget for the next succeeding Fiscal Year referred to in Section 6.1; (j) Generally, to supervise the acquisition, construction, management, maintenance, and operation of the Joint Facilities and personnel of the Authority; -12- (k) To perform such other duties as directed by the Board of Directors and report to the Board of Directors at such times and on such matters as the Board of Directors may direct. Section 3.7. ~egal Advisor. The Board of Directors shall have the power to appoint the legal advisor of the Authority who shall perform such duties as may be prescribed by the Board of Directors. Section 3.8. Other Service~.. The Board of Directors shall have the power-to appoint and employ such other consultants and independent contractors as may be necessary for the purposes of this Agreement. Section 3.9. A~inistrative Suooort. The Member Agencies hereby each agree to provide to the Authority certain administrative support functions as shall be provided in the Bylaws. These functions shall be divided among the Member Agencies so that each Member Agency provides an equal amount of support services in proportion to the other Member Agency a~d any inequalities in the cost of support services provide~ shall result in an adjustment to the annual "operating costs" as provided in Section 6.3. Administrative support functions shall include, but not be limited to, financial (including payroll, purchasing and risk management) and personnel (including labor relations)- Section 3.10. Non-Liability'of Aqencies. Moue of the officers, agents,'or employees dir~t!y employed by the Authority shall be deemed, by reason of their employment by the -!3- Authority, to be employed bY either Agency or, by. reason of their employment by the Authority, to be subject to any of the requirements of eithe~ Agencyl Ail of the privileges and immunities from liability, exemption from laws, ordinances ahd rules, all pension, relief, disabi!it~, workers' compensation, and other benefits which apply to the activities of the officers, agents, or employees of Member Agencies when performing their respective functions shall apply to them to the same degree and extent while engaged in the ? performance of any of the functions and other duties under this .... Agreement. ARTICLE POWERS OF TEE AUT~ORII~/ Section 4.1. General Powers. The Authority shall exercise in the manner herein provided the powers common to each of the Member Agencies, as provided by the laws of the State of California, and all incidental, implied, expressed, or necessary powers for the accomplishment of the purposes of this AgreemRnt, subject to the restrictions set forth in Section 4.4. As provided in the ~alifornia Government Code (commencing with Section 6500), the Authority. shall be a public entity separate from the Member Agencies. The Authority shall have the poyer to finance, acquire, construct, manage, maintain, and operate Joint Facilities. The Authority shall have all of the powers provided in Article 2 of the Joint Exercise of Powers Act, unless specifically prohibited by this document. -14- Section 4.2. SPecific Powers. The Authority is hereby authorized, in its own name, to do ail acts necessary for the exercise of the foregoing powers, including but not limited to, any of the following: (a) To make and enter into contracts; (b) To employ agents or employees; (c) To acquire, construct, manage, maintain, or operate any buildings, works or improvements; (d) To acquire, hold, or dispose of property; (e) To sue and be sued in its own name; (f) To incur debts, liabilities or obligations, subject to the provisions of this Agreement, provided that no debt, liability or obligation shall constitute a debt, liability or obligation upon any Member Agency; (g) To apply for, accept, receive, and disburse grants, loans, and other aids from any agency for the United States of America or of the State of California; (h) To fnvest any money in the treasury pursuant to Government Code. Section 6505.5 that is not required for the immediate necessities .of the Authority, as the Authority determines is advisable, in the same manner and upon the same conditions as local agencies, pursuant to Section 53601 of the California Government Code; -15- To carry out and enforce all the provisions of this Agreement. Section 4.3. Bonds. The Authority shall have all of the powers provided in Article 2 of the Act (commencing with Section 5640), including the power to issue revenue bonds under the Bond Law. Section 4.4. Restrictions on Exercise of Powers. The power of the Authority shall be exercised in the manner provided in the California Government Code and in the Bond Law, and, except for those powers set forth in the Bond Law, shall be subject (in accordance with Section 6509 of the Joint Exercise of Powers Act) to the restrictions upon the manner of exercising such powers that are imposed upon general law cities in the State of California in the exercise of similar powers. Section 4.5. Ob!igation~ of Authority. The debts, liabilities, and obligations of the Authority shall not be the debts, liabilities, and obligations of any Member Agency. ARTICLE V METHODS OF PROCEDURE 'Section 5.'1. Assumption of Responsibilities by the Authority. As soon as pracbical after the effective date of this Agreement, the respective Member Agencies shall appoint members of the Board of Directors and alternates, and the City Managers of the Member Agencies shall give notice (in the manner required by Section 2.8) of the oYganizational meeting of the Board of Directors. At said meeting, the Board of Directors ~hall provide for its regular meetings as required by Section '2.8, elect a Chairperson and Vice-Chairperson, and appoint the Chief.Executive officer, all of whom shall serve until ~he first regular meeting following the end of the succeeding Fiscal Year. Section 5.2. Delegation of Powers; Transfer of Records, Accounts, Funds, and Property. Each.Member Agency hereby delegates to the Authority the power and du'ty to maintain, operate, and manage any fire protection facilities, equipment, resources, and property pf each of the respective Member Agencies within their territorial ~urisdiction, including without limitation all fire stations, land, buildings, fire fighting equipment and emergency response equipment, and to employ the ~ecessary personnel to do any and all other things necessary or desirable to provide continued efficient and economical fire protection services to the Member Agencies. The proper officers and employees of each of the Member Agencies shall transfer to the Secretary, Controller/Treasurer, and Management Committee of the Authority, all records, accounts, funds, and property of each of the Member Agencies which re~ate to the providing of fire protection services and which are necessary or desirable to allow the Authority to function. The records, accounts, funds, and property described' herain shall be further identified and defined in an inventory to be developed by the Management Committee during the period between the effective date and the. operational date of this Agreement. This inventory shall be approved by the Board of Directors'prior to the transfer of-any such records, accounts~ funds, and property. EaCh Member Agency agrees to execute or -17- authorize the execution of all legal documents necessary to accomplish such said transfer. Section 5.3. Joint Fire ?rotection Maintenance and Operation Fund. The Board of Directors shall create a joint fire protection maintenance and operation fund (he:ein called the "operating fund"). Upon the organization of the Board of Directors, the Authority shall assume r~sponsibi!ity for the maintenance and operation of the operatin§ fund and shall pay the administrative expenses of the Authority and all maintenance and operation-costs of the Joint Facilities from said fund. Each of the Member Agencies shall pay into said fund its proportionate share of the maintenance and operation costs of the Joint Facilities, computed on the bases set forth in Section 6.3 of this Agreement. Section 5.4. Capital Acquisition and Reo!acement Fund. The Board of'Directors shall create a capital acquisition and replacement fund ("capital fund") for the purpose of creating a fund for replacement and acquisition of capital equipment an~ property. Each Agency shall transfer its share of the capital replacement and a6quisition fund received from the Dublin-San Ramon Services District into .the capital fund and shall annually pay into said fund its proportionate share of capital replacement costs, as provided in Section 6.3. Any fire connection fees imposed for capital improvements shall be deposited in th~ capital fund (and shall be accounted for on the basis of origination by Membe'r Agency) and shall be used for c~pita! acquisitions. -18- AETICLE VI BUDGET/COSTS MAINTENANCE AND OPERATION/OTHER COSTS Section 621. Annual Budget- The Board of Directors shall adopt a preliminary budget for maintenance and operation costs, capital costs, costs of special services, and bond interest and redemption expenses (if any) annually prior to March t of each year and shall adopt a final budget prior to June 30 of each year. The budget for Fiscal Year 1988-89 shall be approved by each Agency and provided to the B6hrd at its organizational meeting. Section 6.2. Records and Accounts. The Authority shall cause to be kept accurate and correct books of account, showing in detail the capital costs, costs of special services and maintenance, and operation costs of the joint Facilities, and all financial transactions of the Member Agencies relating to the joint Facilities, which books of account'shall correctly show any receipts and also any costs, expenses, or charges paid or to be paid by each of the Member Agencies. Said books and records shall be.gpen to inspection at all times during normal business hours by any representative of a Member Agency, or by any accountant or other person authorized by a Member Agency to inspect said books or records. The Controller/Treasurer ~hall, in accordance with Sections 6505 and 6505.6 of the California Government Cbde (Joint Exercise of Powers Act), cause the books of account and other financial records of the Authority to be audited annually by an independen~ public accountant or certified public accountant. -19 - Section 6.3. Cb) Allocation of Costs and Expenses: GenerallY. Annual Estimate. After adoption of the preliminary budget and.prior to April ! of each year, the Authority shall furnish to each of the Member Agencies an estimate of the total annual maintenance and operation costs, capital costs, costs of special services, and bond interest and redemption expenses (if any). Operating Costs. Th.~ proportion of annual maintenance and operation costs (referred to as "operating costs") to be borne by each Agency shall be based on the assessed valuation of all property within the jurisdictional area of each Member Agency as follows: The assessed valuation of all property within the jurisdictional area of each Member Agency, as shown on the latest assessment rolls used for distribution of taxes ("assessment rolls"), shall be added together the percentage thereof that the total asses'sed va~ue for each Member Agency bears to the whole will be the percentage of operating costs of the Authority to be borne by that Member Agency. The percentage to be used for the succeeding Fiscal Year shall be determined by the Management Committee each year prior to April 1, based on the assessment rolls for that Fiscal Year. In the event that the Management Committee is unable to -20- (c) agree on the percentage for any year, the Board shall determine the percentage. As used herein, "assessed valuation" shall, in the case of property within a redevelopment area, mean the assessed valuation plu~ any increments in value. The percentage for Fiscal Year 1988-89 shall be- determined by the Board at its first meeting and shall be based on the assessment rolls for Fiscal Year 1987-88. Capital.Acquisition Costs, Costs of Special Services, Bond Expenses. Costs of acquiring new equipment, or constructing new facilities, costs of special services and bond interest and redemption expenses (if any) shall be borne by each Member Agency as may be agreed by the Legislative Bodies of the two Member A~encies. At the time new equipment is purchase (with the exclusion of replacement equipment) or new facilities are constructed or real property is purchased, 'the Legislative Bodies shall determine the method of disposing of such assets upon termination. Caoita! Replacement Costs. The proportion of capital replacement costs to be borne by each Member Agency annually shall be based on the percentage for each'year as determined pursuant to Section 6.3(b). -21- (e) Me!lo-Roos Special Tax. Either Agency or the Authority may use the proceeds of a special.tax imposed pursuant to Government Code Section 53311, et seq., ("Me!!o-Roos Community Facilities Act of 1982") to pay for construction of a new fire station or to station. pay operating costs of a new fire Section 6.4. Payment of Costs. Beginning on the operational date of this Agreement, and mon~h!y in advance thereafter for each Fiscal Year, each Member Agency agrees to pay the Authority its allocated share of the total estimated annual costs and expenses, as set forth in Section 6.3, subsections (a) to (d). The Authority shall submit to each of the Member Agencies a final detailed statement of the final costs and expenses for the Fiscal Year, allocated in the same manner as estimated.expenses were allocated, within three (3) months after the close of each Fiscal Year, whereupon final adjustments of debits and credits shall be made by.the Authority. If the amount of any allocated share of any estimlted item of'expense due from a Member Agency was less than the final allocation of such. item to such Member Agency, such Member Agency shall forthwith pay the difference to the AuthoritY. If the amount of any al!ocated share of any estimated items of expense from a Member A~ency was in excess of the final allocation of such item-to such Member'Agency, the Authority shall credit such excess to the appropriate account of such Member Agency. -22- Section 6.5- sources of Funds. Each Member Agency shall provide the funds required to be paid by it to the. Authority under this Agreement from any source of funds legally available to such Member Agency for such purpose. Section 6.6. Additional Charges to Members- Member Agencies shall be held financially responsible for direct additional costs encumbered by the Authority in the implementation of special programs, projects, and services in addition to normal fire preventio~ and suppression activities requested by the respective Member Agency's City Council, or city administrative staff for that specific Member Agency. ARTICLE VII OWNERSHIP; ENFORCEF~NT Section 7.1 Ownershio of Joint Facilities. Prior to the operational date, each Member Agency shall convey to the Authority the real and personal Property described in Exhibit A hereto which real and personal property will thereafter be owned, managed and operated by the Authority. Section 7.2. Enforcement by Authority~ The Authority is hereby authorized to take any or all legal or equitable actions, including but not limited to injunction and specific · perfo~.mance, necessary or permitted by ~aw, to enforce this Ag-=ement.~= AtLTICLE-VIII TE~MINATION Section 8.1. Termination- This.. Agreement shall continue until terminated by a Member Agency of the Authority in the -23- manner hereinafter provided. Upon.termination, any ob!igation of the Authority which continues following termination shall be borne by the Member Agencies based on the percentage determined pursuant to paragraph 8.3. Section 8.2. Effective Dates of Termination. Such termination shall not under-any circumstances become effective until June 30, next succeeding a minimum of twelve (12) months following the giving of written notice of termination by City Council resolution to the other Member Agency's City Manager. Section 8.3. Disposition of Assets. Except as provided in Section 6.3(c), upon the termination of this Agreement, any assets acquired by the Authority during the period of its existence and still on hand and alt cash reserves (=assets-and cash reserves") shall be distributed to the Member Agencies in the following manner: The total amount of maintenance and operating costs paid by each Member Agency into the operating fund during the entire existence of the Authority shall be added together and the percentage which each Agency's total bears ~o the whole shall be determined. The assets and cash reserves shall' be divided Between the Agencies based on the above percentage, based on appraised value of the assets at the time of termination, provided that the real property conveyed to the h~' by each Agency, as described in Exhibit A, shall be Ant .... lty exc!,Ided from such distribution and appraisal and shall be conveyed to each such .Agency upon'termination. In the event the ~gencies cannot agree on the distribution., of assets and cash reserves, an arbitrator shall be selected by the Board to -24- determine the distribution of assets and cash ~eserves. If the Board cannot agree on the selection of an arbitrator, each Agency shall select an arbitrator, and the two arbitrators shall select a third, who together shall decide the manner of distribution of assets and cash reserves, on the basis of this Agreement. The arbitrator(s) ~ay retain the services of an appraiser to assist them and the decision of the arbitrator(s) shall be final. The costs of arbitration (including appraisers' fees) shall be borne by the Agencies equally. MiSCF~EOUS Section 9.1. Section HeadinGs. All section headings in this Agreement are for convenience of reference only and are not to be construed as modifying or governing language in the section referred to or to define or limit the scope of any provision of this Agreement. Section 9.2. Consent. Whenever in this Agreement any consent or approval is required, the same shall not be unreasonably withheld- Section 9.3." Law Governinq. This Agreement is made under the Constitution and laws of.the State of California and is to be sc construed. Section 9.4. Amendments. (a) This Agreement may. be amended at any time, except as limited by contra'ct with bond holders, if any. (b) All amendments to th~.Agreement must be in writing, and must be approved by the City Councils -25- of the Member Agencies prior to becoming ~effective. Section 9.5. Severability. In the~event any provision of this Agreement is determined to be illegal or invalid for any reason, all other provisions and articles of this Agreement shall remain in full force and effect unless and until otherwise. determined. The illegality of any provision of this Agreement shall in no way affect the legality and enforceability of any other provisions of this Agreement. Section 9.6. Successors. T~is Agreement shall be binding upon and shall inure to the benefit of the successors of the respective Member Agencies. No Member Agency may assign any right or obligation hereunder without written consent of the other Member Agencies. Section 9.7. Notice. Notice of any Member A§ency to any other Member Agency shall be given in the manner and to the addresses established in the attached Bylaws for this purpose. EXECUTION OF AGREEMENT IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be ~xecuted and attested by their proper officers thereupon duly authorized and their official seals'to be hereto zffixed on the dates as shown.herein. Dated: ATTEST: City Clerk, City o~JDublin -26- City Attorney, City of Dublin .' .~ayor, City of San Ramon -27- FIRST. A/~--I~DM~/~T TO JOIA=2 ~CISE Or FOW~-R~ AG~wm~ENT/ DOUGHTY R_E~IONAL FIP~E A~ITHOP. ITY T~__rS AGP~E~KT is ~nt~r~d into Be%ween ~e City of D~!Ln end the City of San R~on, being the M~er Agencies si~ato~ to the Joint Exercise of Powers Agreement/Doughe~y Ra~ionai Fir~. Au~ority. THIS FZ~T ~ND~NT to ~e Jolt Exercise of Powers Agreem~nt/Douq~e~y Re~ionai Fire Au~ority is en~mred into as ~f ~ 6~tm of ~pprovml by th~ city of D~tin' or the City cf San R~on, whichever occurs later. iT iS ~~ AG~ED ~men ~ City of D~!h and ~a City of San R~on ~at ~he Joint Exercise of Powers A~e~en=/Dough~y 1. Dele2a Section 5.4. Cap~t2~ A~isition and ~mm!ac~man~ "Section 5.4. Cauital_Acquisition and _Rem.!acament Fungi. ~e Bonrd of D~ectors shall create ~ capital ac~isition ~d f~d .for repiacemen% and ac~izition of capi~l e~ipm~= ~d Drope~Y- Each Agency shall transfer its share of ~a caDital rep!a=~% ~d ac~isition f~d received from ~e D~!~ S~ ~_~on S~ice~ Dis~i~ ~nto the ~pit~ f~ ~d shall ~ua!!y DaY ~o sai~ f~d its propc~iunats share of capital repiacem~t cos~, am provide~ in Se~ion 6.3. ~y fire .co~e~ion fees ~Dosed for capita! ~prov~ents shall be deposited ~ ~e c=pi~! 2 =end!. j pa ATTACHMENT 2 fund (and =h~i! be accoun%~d for on the basis of origination by ~ember Agency) and shall be u~ed for capita! replacement and acumisitions-" EXCEr-~f AS EX~.%ESSLY AMENDED herein, tb.e Joi~% Exercise" of Powers Agree_ment/Dougher%y Regional Fir~ Authority shall remain in full forc~ and eff~¢~. , rN WITNESS WHEREOF, the parties hereto have caused tl%is First hereto aff~ed on ~e datss as sho~ her~in. Da%aa: ~cam~r 12:1988 ~ J Ci%~ of D~iin (~ Ma~ city Clerk, City df Dub!i~ 'APPEO%rEDy TO FORM: .~ (Signatures continued on nex~ page.) 2 ~mendl. j pa 2 ~TTEST ~ C~ty C~k, C~y of SM R~n APPROVED AS .TO~. cit~ A~t~ rn~y, ~ City~ of San Ramon December 2, 3~ SECOND AMENDMENT TO DOUGHERTY REGIONAL FIRE AUTHORITY JOINT EXERCISE OF POWERS AGREEMENT This is the Second Amendment to the Joint Exercise of Powers Agreement (which, together with the First Amendment thereto is referred to as "JEPA") entered into between the cities of. San Ramon and Dublin to create the Dougherty Regional Fire Authority (hereinafter referred to as "Authority") The city of San Ramon has elected to exercise its right under Paragraph 8.1 of the JEPA to terminate the JEPA and the Authority effective June 30, 1997. Paragraph 8.1 of the JEPA provides that: "Upon termina- tion, any obligation of the Authority which~ continues following termination sh~ll be borne by the Member Agencies based on the percentage determined pursuant to Paragraph 8.3" However, in the course of planning for termination of the Authority, the Board of Directors has determined that the obligation of the Authority to provide medical benefits to its retired employees can be best met by continuing the Authority in existence for limited purposes beyond June 30, 1997. This will allow the Authority to maintain the contractual relationship with the Public Employees Retirement System through which these medical benefits are currently provided. The purpose of this amendment is to allow for continua- tion of the Authority beyond June 30, 1997, for the limited purposes of winding up the affairs of the Authority as set forth herein. IT IS AGREED as follows: ATTACHMENT 3 1~ Term. This Second Amendment shall become effective when approved by both the City of Dublin and the City of San Ramon and shall'remain in effect until terminated pursuant to Article VIi! of the JEPA. 2. Continuation of Authority. Neither the JEPA nor the Authority shall terminate on June 30, 1997,as a result of' the notice of termination given by the City of San Ramon on June 27, 1996, but shall continue in effect for the limited purposes set forth in this Second Amendment. 3. Administration of Authority. 3.1 Governin~ Board. Commencing July 1, i997, the Authority shall be administered by a Board of Directors consisting of the city Managers of the cities of San Ramon and Dublin. The Board shall meet as needed but at least once each year and shall receive no compensation from the Authority with the exception of reimbursement for reasonable and necessary expenses incurred in performance of their duties. Any action by the-Board requires the concurrence of both members. A quorum consists of both members. All meetings of the Board shall be conducted in accordance with the Ralph.M. Brown Act. 3.2 Officers. The Management' Committee is abolished effective July 1, 1997. The offices of Secretary and Controller/Treasurer shall be filled as designated'by the Bylaws. 3.3 EmDloyees. Effective July .!, 1997, the Authority shall have no employees. 4. Powers of the Authority. The Board of Directors shall have the following specific powers and no others, beginning July 1, 1997: 4.1 To wind up the affairs of the Authority; 4.2 To perform any contractual obligations of the Authority existing on June 30, 1997; 4.3 To make and administer contracts which provide medical benefits to retired employees of the Authority; 4.4 To process and act upon worker compensation claims filed with the Authority or to.contract for the processing of such claims; 4.5 4.6 To sue and be sued in its own name; and To retain legal counsel or other consultants to assist in carrying out the powers authorized under this paragraph. 5. Disposition of Personal Property Owned b~ Authority. Personal property assets, however and whenever acquired, held by the Authority on June 30, 1997, shall be distributed as follows: All vehicles, tools, equipment and supplies considered by the San Ramon Valley Fire Protection District as necessary to serve its newly acquired service area shall be distributed to the City of San Ramon. for transfer to the San Ramon Valley Fire Protection District. Likewise, all vehicles, tools, equipment and supplies considered by the Alameda County Fire Protection District as necessary to serve its newly acquired service' area shall be distributed to the City of Dublin for use by the Alameda County Fire Protection District. All vehicles, tools, equipment and supplies unclaimed by the San Ramon Valley Fire Protection District or the City of Dublin on behalf of the Alameda County Fire Protection District without resolution of the conflicting claims by June 30, 1997 shall be offered for sale to the below-listed agencies in the following order: a. Alameda County Fire Protection District/San Ramon Valley Fire Protection District. b. cities of San Ramon and Dublin. c. Any other governmental agency. All remaining items not distributed or purchased as provided above shall be sold at public auction with sales'proceeds distributed in accordance with the JEPA provisions relating to distribution of cash. This paragraph shall not affect distribution of Authority real property and improvements, all of which continue to be governed by applicable provisions of the JEPA and by Paragraph 6 below. 6. Disposition of Real Propertv Owned by Authority. Section 8.3 of the JEPA provides that on termination of the Authority, title to any real property conveyed to the Authority by either city be transferred back to that city. Additional real property has been acquired subsequent to creation of the Authority. It is intended that such real property be treated the same.as the original real property referenced in Section 8.3 of the JEPA with the result that title to all real property and improvements thereon shall be transferred by the Authority on or before June 30, 1997, to the city in which such real property is located. 7. Allocation of ODeratinq Costs for FY 1996-97. Not- withstanding Section 6.3(b) of the JEPA, the cost of any performance pay bonuses given during FY 1996-97 and any costs associated with the Board's action on April 21, 1997 approving amendment of its contract with the Public Employees Retirement System to provide additional service credit options pursuant to Government Code §S20903 and 20903.5 for the Battalion Chief/Fire Marshal (Fire Prevention Division) and the Battalion Chief (Operations Division) positions shall be paid by the City of San Ramon. 8. ~atta!ion chief incremental Cost. The City of San Ramon shall reimburse the city of Dublin for the "incremental cost" incurred and paid by the City of Dublin in its contract with the County of Alameda for provision of fire service (the "Dublin Fire Contract") for payment of compensation to Battalion Chief T.J. Welch as follows: During the first five years of the Dublin Fire Contract, San Ramon shall reimburse Dublin in the amount of ~q% of the "incremental cost;" during the second five years of the Dublin Fire ~ontract, San Ramon shall reimburse Dublin in the amount of 100% of the "incremental cost;" and during the following five years of the Dublin Fire Contract, Dublin shall be responsible for 100% of the ,,incremental cost." As used herein, the incremental cost" shall mean 27% of T.J. Welch's total compensation .as a Battalion Chief with the Alameda County Fire District until such time that the Alameda County Fire District forms a third battalion or T.J. 5 Welch moves into another position other than the position h~ will hold on July 1, 1997. San Ramon mhal! relmbur~e Dublin within n0 days of mubmisnlon by Dublln of an invoice for such cost~ 9. Confli~t~ Between JEPA and Second Amendment- Tn the event of any conflict, ~xpre~ or implied, between thim S~cond Amendment and tho JEPA, the provisionz of thi~ Second Am~mdm~t shull prevail. IN WITNESS WHZREOF, th~ parties have executed thi~ Second Amendment on the dato~ indicated below. Dated: CITY OF SAN RAMON PATRICIA BOOM, Mayor APPROV~ FORM: AT~T: Dated: ~- ~-~ ~ APPROVED AS TO FORM: ELIZAB~.TH H. SILVER City Attorney CITY OF DUBLIN KAY KECE~, ~ Clerk~. i-amo~19, cioc/md 6 Post-it* Fax Note 7671 AGENDA STATEMENT CITY COUNCIL MEETING DATE: June 5, 2001 CITY CLERK. File # [~.....~J SUBJECT: Written Communication: Request from Alameda County Firefighters/IAFF Local No. 55 to provide retirement enhancement benefits (PERS 3% at 50) to former Dougherty Regional Fire Authority employees. Report prepared by Richard C. Ambrose, City Manager ATTACIt-ME~S: Letters of April 19 and April 27, 2001 from Alameda County Firefighters/IAFF Local No. 55 Second Amendment to JEPA (DRFA) RECOMMENDATION: Determine if there is an interest to meet with the City of San Ramon to discuss this request; or Deny Request FINANCIAL STATEMENT: In January 2001, the Public Employees Retirement System (PERS) prepared a "Contract Amendment Cost Analysis" with a valuation basis as of June 30, 1999. The analysis provided information regarding the potential cost to DRFA if it were to amend its contract with PERS to provide the 3% at 50 benefits to all current members of the plan. The analysis showed that, if DRFA were to amend its PERS contract to provide the 3% at 50 benefits; the change, Which would result, is a decrease in plan assets of $1,304,706, which represents the potential cost of such an amendment. Since the most recent valuation is out of date the cost could vary,. DESCRIPTION: On April 27, 200I, the Dublin City Council received the attached letter from the Alameda County Firefighters./IAFF Local #55 requesting that DRFA change its retirement contracts from 2% at 50 to 3% at 50. Alameda County recently modified its retirement contract from 2% at. 50 to 3% at 50. All County employees receive 3% at 50 for their years of service with Alameda County Firel The fire Union is requesting DRFA modify its contract with PERS so that former DRFA employees receive 3% at 50 for those years of service with DRFA and DSRSD. The DRFA Board of Directors, which consists Of the City Managers of Dublin and San Ramon, met regarding the PERS 3% at 50 retirement issue. First, the Board discuSsed this matter on February 7; 2001, at the request of Alameda County Fire Chief William McCammon. The request came to the DRFA Board' COPIES TO: Brian McKenna, President Alameda CountY Firefighters William J. M¢Cammon, Fire Chief, ACFD Herb Moniz, City Manager, CitY of San Ramon ATTACHMENT 4 during the Alameda County Fire Department and San Ramon Valley Fire Protection District s.~_respective meet and confer process in which both agencies were negotiating the additional retirement benefit." At., that time, the DRFA BOard directed Staff to get a legal opinion regarding DRFA's authority to amend the. PERS co.ntract, to determine the Board's legal obligation to meet and confer regarding this matter under the Meyers-Milias-Brown Act (MMBA), and several other legal issues. Second, on April 18, 2001 the, · DRFA Board met again regarding this matter and .after lengthy discussion approved a motion to forward the request to the City Council for consideration provided that anyone making the request identify the public purpose and public benefit of the PERS contract amendment. The DRFA Board never received such a request. Background DRFA was formed in 1988 between the two Cities to provide fire Services. In early 1997, the City of San Ramon decided to provide fire services l~y annexation to the San Ramon Valley Fire Protection District. Accordingly, the parties began the process of winding up the affairs of DRFA. Although the original intent was to terminate DRFA entirely, the decision was made to continue it in existence in order to wind up the affairs of DRFA.' Accordingly, it was given only very limited powers. The "Joint Exercise of Powers Agreement/Dougherty Regional Fire Authority" (JEPA) was amended in' 1997 by the Second Amendment to name the City Managers of the Cities of Dublin and San Ramon as the Board of Directors and to require concurrence of both members for actiom (JEPA 3.1) The Second Amendment prohibited DRFA from having employees as of July 1, 1997 (JEPA 3.3) and limited the Board's powers to those specified in Section 4 of the Second Amendment and no others. The Board's authority is limit, ed to: winding up the affairs of the Authority; performing any contractual obligations of DRFA existing on June 30, 1997; making contracts for medical benefits for retired employees; processing and acting on workers' compensation claims; suing and being sued; and retaining legal counsel or other consultants to assist in carrying out the above powers. (See Attachment 2) The current DFRA Board of Directors was not given authority to amend DRFA's contract with PERS to change the level of retirement benefits. Such authority would be necessary in order for the Board of Directors to consider amending the retirement benefits that the former DP_FA employees will receive from PERS' due to their years of service with DRFA. The existing Board's powers can be enlarged only by amendment of the JEPA, which would have to be approved by a majority of the Councils of the two Cities. Such an amendment could provide the current Board with the authority (and then the direction) to amend the contract between DRFA and PERS. Upon directiOn by the Dublin City Council, Staff will transmit the Council's action to the City of San Ramon - City Council for similar consideration. It would take a majority of the Councils of the two Cities to authorize the amendment to the JEPA. If this takes place the two City Managers would convene as the DRFA Board to consider the request to amend the retirement benefits for former DRFA employees. Alternatively, again, a majority of the Councils of the two Cities could elect to change the composition of the DRFA Board, so as to enable the Councilmembers to act on the request for enhanced PERS benefits. Financial Analysis In January 2001, at the request of the Fire Union, PERS provided DRFA and the Fire Union with a "Contract Amendment Cost Analysis" with a valuation basis as of June 30, 1999. The AnalYsis provided information, regarding the potential cost to DR.FA if it were to amend its contract with PERS to provide the 3% at 50 benefits to all current members of the plan. The Analysis indicated that DRFA's plan had assets in excess o£ the total present.value of retirement benefits for its current members, and was therefore "suPper-funded'' as of June 30, 1999. The Analysis 'showed that the difference between the total value of retirement benefits for current members and.the actuarial value of DRFA's plan assets was $6,645,475, representing the mount, as of June 30, 1999, of DRFA's excess plan assets. These assets are the monies that the Cities of Dublin and San Ramon overpaid into the plan during DRFA's active period ~and market earnings. Pre-Amendment Change Due To Plan Post-Amendment Post Amendment & Method Method Change Change. Accrued Liability $ 16,945,195 $ 2,420,839 $ 19,366,034 Assets 23,590,670 1,116,133 ~ 24,706,803 Unfunded Liability (6,645,475) 1,304,706 (5,340,769) The analysis above shows that, if DRFA were to amend its PERS contract to provide the 3% at 50 benefits; the change which would result is a decrease in plan assets of $1,304,706, which represents the potential cost of such an amendment: If there were such an amendment, the excess plan assets would be reduced by that amount, to $5,340,769 (based on 6/30/99 valuation). Since DRFA's plan was superfunded as of 6/30/99, DRFA's contribution level would continue to be zero; however, there would be a cost to the plan due to a decrease in assets. Thus, if DRFA wishes to terminate its contract with PERS someday, the refund of its excess assets would be significantly less if DRFA were to provide the enhanced retirement benefits than if it decided not to provide those benefits. In light of downturn in the stock market since June 1999, it is likely that the excess assets left over would be significantly less than $5,340,769. In the unlikely event of a shortage of funds in future years, DRFA would be required to pay the deficit, not inactive employees. Local 55's letter of April 27, 2001, implies that inactive DRFA employees will pay 13.7% of their salary to receive the enhanced retirement benefit for service with DRFA and DSRSD. This is not correct, what is correct is that the MOU with Alameda County Fire Department provides for the 3% at 50 PERS retirement benefit, but also requires active Alameda County employees contribute 13.7% of their salary towards the enhanced benefit for service with Alameda County. Former DRFA employees will never make a contribution to DRFA (or Alameda County) for this enhanced retirement benefit, if DRFA provides this benefit. If the Council determines there is an interest in discussing this request with the City of San Ramon or should DRFA termlnate its contract with PERS, Staff would recommend an up-to-date independent valuation analysis be conducted to verify the financial analysis provided by PERS is accurate. The cost of this analysis would be authorized by DRFA and split between the Cities of Dublin and San Ramon. Conclusion DRFA's June 30, 1999 valuation included 50 inactive DRFA safety members. These are the former employees of DRFA that chose not to retire. Of those 50 members many came to DRFA from the Dublin San Ramon Services District (DSRSD) or another PERS agencies. Those employees brought to DRFA their service credit from DSRSD or another agency. After they left DR_FA on July 1, 1997 those 50 former DRFA employees began new employment; thirty-one (3I) went to the Alameda County Fire Department and six (6) went to the San Ramon Valley Fire Protection District (SRVFPD), and the remainder went to other agencies or left the PERS system entirely. benefits and PERS 'service credit under their respective new employers; similarly those DSRSD employees that came to DRFA began receiving service credit under DP, FA not DSRSD. When DRFA ceased operations on June 30, 1997 it became an inactive employer. Based on a review of this matter with the City Attorney's Office, the DR_FA Board has no obligation or authority to meet and confer.with former or retired employees under the Meyers-Mitias-Brown Act (Government Code SeCtion 6505). The function of negotiations does not exist. Simil~ly, former DSRSD employees are inactive members of that agency and there is no obligation to meet and confer' over wage and benefit matters. In the same way; miscellaneous employees that move from One PERS agency to another can not go'back to negotiate wage and benefit enhancements. When an employee separates from one agency contributions'to PERS are terminated; the new employer then begins their contributions and the employee receives the new agency's contracted PERS benefits and service credits. ' Article XVi, Section 6, of the California Constitution provides in relevant part: "The Legislature shall have no power..., to make any gift or authorize the making of any gift, of any public money or thing of value to any individual, municipal or other corporation whatever..." this is called the gift of public funds doctrine, which requires expenditures of pubic agencies to be for a public purpose. It is difficult to identify a "public purpose" that would justify this expenditure for DRFA. DRFA does not currently employ any of the. individuals that would benefit from the increased retirement benefits not can it because, it is. precluded from employing anyone. Even though some of the firefighters who would benefit from this increase currently provide services to the City of Dublin, DRFA does not receive the benefit of those services. Enhancing retirement benefits for former employees who currently work for SRVFPD may also constitute an unlawful gift of public funds because there is not "public purpose" being served by DR_FA in making this expenditure. Moreover, since DRFA is not trying to attract or retain any current of future firefighter employees, the ~'normal" purpose of an enhanced pension benefits does not apply. Under the Government Code, amendments to PERS contracts may not provide for retirement benefits for some but not all local firefighters, and may not provide different retirement benefits for any subgroup of members. 'Thus, DRFA must treat all of their former fire fighters the same with regard to retirement benefits. DRFA cannot provide different benefits for former employees now employed by Alameda County, by SRVFPD, or other public agencies. On April 19 and April 27, 2001, the Dublin City Council received the attached letters from the Alameda County Firefighters/IAFF Local #55. To date, the San Rarnon City Council has received .no correspondence regarding this matter. Recommendation Staff recommends that the City Council review the staff report and deny the request; or determine if there is an interest to meet with the City of San Ramon to discuss the request. ALAMEDA COUNTy FIREF'IGHTERS 414 - 13th Streeb suite 300 Oakland, CA 94612 INTERNATIONAL ASSOCIATION OF FIRE FIGHTERS April 27, 2001 Honorable CoUncil Members City of Dublin 100 Civic Plaza Dublin, CA 94680 LOCAL 55 RE: DR.FA PERS (Safety) 3% ~ 50 Benefit Dear Council Members: .The purpose of this correspondence is to follow-up my letter dated 04/19/01 referencing the PERS 3% ~ 50 benefit for our deferred DR_FA members. I hereby request that the City of Dublin City Council place on their agenda and address, as soon as practicable, the aforementioned topic. It is of paramount importance that this issue is resolved as expeditiously as possible. Our former DRFA members deserve retirement benefits that are consistent with their sister & brother firefighters throughout our organization. Likewise, they will begin contributing 13.7% of their salary in June to receive this benefit but would be unable to do so without action by the City Councils ofDubtin & San Ramon. Your prompt attention in this matter would be greatly appreciated. If I can provide any further information an~'or assistance please feel free to contact.me at (510) 914-6028 Sincerely, Brian M McKerma, President Alameda County Firefighters / IAFF Local #55 I:\BMCKENNAkFollow-up Houston 3% ~ 50.doc' ALAMEDA COUNTY FIREFIGHTERS '' .' . 414- 13th Street' Suite 30'0 .' Oakland, CA'94612 ' y~ ~:~/~ iNTERNATiONAL AsSocIATION OF FIRE FIGHTERS ( L O C A'L 55 FJ~'C~'~V~D " CITY OF DUE LjN April 19, 2001 Honorable City Council Members City of Dublin 100 Civic Plaza Dublin, CA 94680 Dear Council Members The Alameda County Fire Department (ACFD) has been working with the Dougherty Regional Fire Authority (DFRA) Board of Directors to provide a change in the retirement benefits for .those individuals who worked for DRFA and became members of the ACFD or the San Ramon Valley Fire. Protection District (SRVPD). The ACFD and the SRVPD have adopted the 3% ~50 retirement benefit. The firefighters, who have a long history of serving the Cities of Dublin and San Ramon, are requesting that their retirement benefits be consistent with the retirement benefits of the organizations into which they were consolidated when DRFA was dissolved. The Alameda County Firefighters Local #55 believes that it is important for all of our members to have similar benefits, and as such has requested the City of Dublin's assistance in securing this change in benefits. Timing of the establishment of the benefit 'is essential, so .we would appreciate your earliest attention to this matter. If I can provide any further information and/or assistance please feel free ;o contact me at (510) 914-6028 B/iafl lV~ MqKeni~a, President fllame~a C0'un Ftyt }refighters/IAFF Local #55 C:\temp\97kMcKennaHouston.doc RESOLUTION NO. - 01 A RESOLUTION OF THE CITY COUNCIL OF TllE CITY OF DUBLIN AMENDING JOINT EXERCISE OF POWERS AGREEMENT/ DOUGHERTY REGIONAL FIRE AUTHORITY WHEREAS, by Resolution No. 88-15, the City Council approved the "Joint Exercise of Powers Agreemem/Dougherty Regional Fire Authority," which Was subsequently executed by the Mayor; WHEREAS, the "Joint Exercise of Powers Agreement/Dougherty Regional Fire Authority" can be amended, as provided in Section 9.4 of said Agreement upon approval of the City Councils of the Cities of Dublin and San Ramon; and WHEREAS, the City Councils of the Cities of Dublin and San Ramon approved the "First Amendment to Joint Exercise of Powers Agreement/Dougherty Regional Fire Authority," effective December 15, 1988; and WHEREAS, the City Councils of the Cities of Dublin and San Ramon approved the "Second Amendmem to Joint Exercise of Powers Agreement/Dougherty Regional Fire Authority," effective June 17, 1997; and WHEREAS, the City Manager has presented to the City Council and has recommended approval of the "Third Amendment to Joint Exercise of Powers Agreement/Dougherty Regional Fire Authority," a copy of which is attached hereto as Exhibit A; and WHEREAS, the Council is familiar with the contents of Exhibit A; NOW, THEREFORE, Dublin City Council does hereby approve the "Third Amendment to Dougherty Regional Fire Authority Joint Exercise of Powers Agreemem" and authorizes the Mayor to execute said Amendment. PASSED, APPROVED AND ADOPTED this 2na day of October, 2001. AYES: NOES: ABSENT: ATTEST: Mayor ABSTAIN: City Clerk K2/G/10-2-01/reso-drfa. doc (Item 8.1) ATTACHMENT 5 THIRD AMENDMENT TO DOUGHERTY REGIONAL FIRE AUTHORITY JOINT EXERCISE OF POWERS AGREEMENT THIS AGREEMENT is entered into between the City of Dublin and the City of San Ramon, being the Member Agencies signatory to the Joint Exercise of Powers Agreement / Dougherty Regional Fire Authority ("JEPA"). The JEPA was amended by the First Amendment, made in December 1988, and the Second Amendment, made in 1997. IT IS HEREBY AGREED between the City of Dublin and the City of San Ramon that the JEPA, as amended by the First Amendment and the Second Amendment, shall be further amended as follows:' 1. Section 1.16 of the JEPA is amended as follows: "Quorum. 'Quorum' means of a majority of the Board of Directors, but in no case less than three persons from each Member Agency necessary to conduct business." 2. Section 2.7 of the JEPA is amended as follows: "Section 2.7 Governing Board. The Authority shall be administered by a Board of Directors consisting often (10) members. Five (5) members shall be councilmembers of the City of Dublin and five (5) members shall be councilmembers of the City of San Ramon. The Board of Directors shall be called the 'Board of Directors of the Dougherty Regional Fire Authority.' All voting power of the Authority shall reside with the Board of Directors. Each director shall cease to be a member of the Board of Directors when such member ceases to hold office as a councilmember. Members shall receive reimbursement for reasonable and necessary expenses incurred in performance with their duties, as provided in the By Laws." 3. Section 2.8 of the JEPA is amended as follows: "Regular Meetings. The Board of Directors shall meet at least annually at a date, time and place fixed by resolution of the Board of Directors." 4. Section 2.9 of the JEPA shall be amended as follows: Third Amendment to Dougherty Regional Fire Authority Joint Exercise of Powers Agreement Page 1 of 3 September 12, 2001 EXHIBIT A "Required Votes; approvals. The affirmative votes of at least three (3) members of each Agency shall be required to take any action by the Board of Directors and less than a quorum may adjourn from time to time." o Section 3.6 of the JEPA shall be amended as follows: "Management. Regular management of the Authority shall be vested jointly in the Management Committee, The Board of Directors shall annually appoint a chairperson of the Management Committee who shall be designated by the Chief Executive Office of the Authority and a Vice Chairperson of the Management Committee who shall act in the absence of the Chief Executive Officer. The Chief Executive Officer shall be rotated annually so that the Chief Executive Officer is from the same Agency as the Chairperson of the Board. Unless otherwise required by statute, the Management Committee shall have the power, on behalf of the Board of Directors, to take the actions specified in Section 4 of the Second Amendment. The Management Committee shall have the power to employ consultants, if necessary, to assist it in taking the actions specified in Section 4 of the Second Amendment." 6. Sections 3.1 (Governing Board) and 3.2 (Officers) of the Second Amendment to Joint Exercise of Powers Agreement / Dougherty Regional Fire Authority are hereby deleted. 7. The following language shall be added to Section 4 of the Second Amendment to the JEPA: "4.7 To amend the Authority's agreement with the Public Employees Retirement System to enhance the level of benefits provided. 4.8 To terminate the Authority's agreement with the Public Employees Retirement System." This third amendment will be effective on the date signed by both agencies. Third Amendment to Dougherty Regional Fire Authority Joint Exercise of Powers Agreement Page 2 of 3 September 12, 2001 IN WITNESS WHEREOF, the parties have executed this Third Amendment on the dates indicated below. CITY OF SAN RAMON Dated: By: DAVID E. HUDSON, Mayor Attest: Judy Macfarlane, City Clerk Approved as to form: Thomas Curry, City Attorney Dated: By: Attest: CITY OF DUBLIN GUY HOUSTON, Mayor Kay, Keck, City Clerk Approved as to form: Elizabeth H. Silver, City Attorney Third Amendment to Dougherty Regional Fire Authority Joint Exercise of Powers Agreement Page 3 of 3 September 12, 2001