2019 - 2023 Local 39 Memorandum of Understanding: Article 27: Retirement

International Union of Operating Engineers, Stationary Engineers - Local 39

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27.1 Retirement – Employees Hired On or Before December 31, 2012 and Employees Who Are Hired After That Date if Qualified for Pension Reciprocity
- 27.1.1 Final Compensation Based on Single Year
- 27.1.2 3% @ 60 Pension Formula
- 27.1.3 Required Employee Contribution
- 27.1.4 Employee Cost Share – 50% of Normal Cost
27.2 Retirement – Employees Hired On or After January 1, 2013
- 27.2.1 Final Compensation Based on Three Year Average
- 27.2.2 2% @ 62 Pension Formula
- 27.2.3 Required Employee Contributions
27.3 Retirement – Credit for Prior Public Service

27.1 Retirement – Employees Hired On or Before December 31, 2012 and Employees Who Are Hired After That Date if Qualified for Pension Reciprocity

This Section 27.1 (including Subsections) shall apply to employees hired on or before December 31, 2012 who are contributing members of the Sonoma County Employees’ Retirement Association (SCERA). This Section 27.1 (including subsections) shall also apply to employees hired on or after January 1, 2013, and qualify for pension reciprocity pursuant to Government Code Section 7522.02(c) and any related SCERA reciprocity requirements.

27.1.1 Final Compensation Based on Single Year

For purposes of determining a retirement benefit, final compensation for employees covered by this Section 27.1 shall mean the average annual compensation earnable by the member as specified in Government Code Section 31462.1.

27.1.2 3% @ 60 Pension Formula

The 3.0% at 60 pension formula shall be available to employees covered by this Section 27.1 who are contributing members of the SCERA.

27.1.3 Required Employee Contribution

SCERA members covered by this Section 27.1 will contribute the amount required by SCERA as employee contributions, and shall continue to pay an additional 3.03% of pay, pretax, to their employee retirement account. This 3.03% of pay contribution of the employee’s pensionable compensation shall be paid as part of the County’s contribution to pay for the unfunded accrued actuarial liability resulting from past service. This additional 3.03% contribution will continue until July 2024. Employees also will continue to pay a pretax statutory contribution of approximately 1% or slightly more, contingent upon age of entry into the retirement system.

27.1.4 Employee Cost Share – 50% of Normal Cost

Effective the first full pay period following September 1, 2016, and subject to Sonoma County Employees Retirement Association (SCERA) Board approval of the cost share arrangement under the terms described herein, active County General legacy members of SCERA will contribute one third of the actuarially determined difference between the average General legacy employee retirement rate (exclusive of the 3.03% payroll contribution toward the UAAL described in section 27.1.3 of the MOU) and one half the total normal cost (“total normal cost” includes both employer and member shares) calculated as an average for General legacy Members of the Sonoma County Employees Retirement Association (SCERA) covered by this Section 27.1 based on rates of all active County General legacy members, with the difference computed to a factor and applied equally to all legacy members. Such legacy employees will receive a lump sum benefit allowance as reimbursement for this pension cost share arrangement each pay period equal to the dollar value of the deduction described in this paragraph, less any required taxes.
Effective the first full pay period following July 1, 2017, and subject to Sonoma County Employees Retirement Association (SCERA) Board approval of the cost share arrangement under the terms described herein, active County General legacy members of SCERA will contribute an additional one third (for a total of two thirds) of the actuarially determined difference between the average General legacy employee retirement rate (exclusive of the 3.03% payroll contribution toward the UAAL described in Section 27.1.3 of the MOU) and one half the total normal cost (“total normal cost” includes both employer and member shares) calculated as an average for General legacy Members of the Sonoma County Employees Retirement Association (SCERA) covered by this Section 27.1 based on rates of all active County General legacy members, with the difference computed to a factor and applied equally to all legacy members. Such legacy employees will receive a lump sum benefit allowance as reimbursement for this pension cost share arrangement each pay period equal to the dollar value of the deduction described in this paragraph, less any required taxes.
The lump sum benefit allowance described in Sections 27.1.4 (a) and (b) will not be included in wages for computations of overtime, pension benefits or for any County benefit related purpose.

27.2 Retirement – Employees Hired On or After January 1, 2013

This Section 27.2 (including subsections) shall apply to employees hired on or after January 1, 2013, who are or become contributing members of the SCERA and who do not qualify for pension reciprocity pursuant to Government Code Section 7522.02(c).

27.2.1 Final Compensation Based on Three Year Average

As required by Government Code Section 7522.32, effective January 1, 2013, for the purposes of determining a retirement benefit for SCERA members covered by this Section 27.2, final compensation shall mean the highest average annual pensionable compensation earned during 36 consecutive months of service.

27.2.2 2% @ 62 Pension Formula

As required by Government Code Section 7522.20, the 2.0% at 62 pension formula shall be available to employees covered by this Section 27.2 who are contributing members of the SCERA.

27.2.3 Required Employee Contributions

As required by Government Code Section 7522.04(g), SCERA members covered in this Section 27.2 shall pay 50% of normal costs. In addition, SCERA members covered by this Section 27.2 shall pay 3.03% of the employee’s pensionable compensation toward the County’s employer contribution to retirement costs. This additional 3.03% contribution shall continue until July 2024.

27.3 Retirement – Credit for Prior Public Service

In addition to any other retirement buyback provision authorized by law and applicable rules of SCERA, employees who are contributing members of SCERA can purchase retirement credit for public service time rendered prior to employment with the County of Sonoma to the extent allowed by Government Code Sections 7522.46, 31641.1 and 31641.2 and other provisions of law, during the term of this MOU.