SR - RES-11029 - LETTER OF UNDERSTANDING EFFECTIVE JULY 1 2017 TO DECEMBER 31 2019 & AGREEMENT WITH ICMA RETIREMENT CORPORATION1. SUBJECT
Resolution No. 11029 — A Resolution of the City Council of the City of Orange Establishing a
Letter of Understanding between the City of Orange and the Orange Management Association
(OMA) Effective July 1, 2017 to December 31, 2019.
2. SUMMARY
Resolution No. 11029 establishes a Letter of Understanding between the City of Orange and the
Orange Management Association effective July 1, 2017 to December 31, 2019. Details of this
agreement are provided under Section 6, "Discussion and Background" below.
3. RECOMMENDED ACTION
1. Approve Resolution No. 11029.
2. Approve Administrative Services Agreement with ICMA Retirement Corporation (ICMA-
RC) to administer the Retirement Health Savings Plan.
4. FISCAL IMPACT
Onctina C'iimmanr
Fiscal Year 2017 -18
Cost Description
General Fund
All Other Funds
Cost of One -Time Lump Sum Payments
$42,800
$36,100
Cost for Negotiated Benefits
$25,600
$21,600
Total Annual Cost
$68,400
$57,700
Fiscal Year 2018 -19
Cost Description
General Fund
All Other Funds
Cost of One -Time Lump Sum Payments
$42,800
$36,100
Cost for Negotiated Benefits
$45,600
$38,500
Total Annual Cost
$88,400
$74,600
Fiscal Year 2019 -20
Cost Description
General Fund
All Other Funds
Cost of One -Time Lump Sum Payments
$21,400
$18,100
Cost for Negotiated Benefits
$42,200
$35,600
Total Annual Cost
$63,600
$53,700
5. STRATEGIC PLAN GOAL(S)
1. Provide for a safe community.
a. Provide staffing and resources to deliver services that ensure public safety.
2. Be a fiscally healthy community.
a. Expend fiscal resources responsibly.
6. DISCUSSION and BACKGROUND
In February 2017, the City began the collective bargaining process with the Orange Management
Association. The prior contract between the parties expired on June 30, 2017. On September 19,
2017, the parties reached agreement on the terms and conditions of a new two and a half -year
labor contract that includes the following:
Term of Agreement I Effective July 1, 2017 through December 31, 2019
Salary Effective October 20, 2017, the first full pay period in July 2018, and
the first full pay period in July 2019, employees shall receive lump -
sum payments in accordance with the Schedule attached as Appendix
"A ". The lump -sum payment is equal to approximately 2% of top -
step for each classification in October 2017 and July 2018, and
approximately 1% of top -step for each classification in July 2019.
Only employees that are active (employed by the City) during the pay
period that a lump -sum payment is to be made are eligible for such
payments. Payments will be according to the classification the
member is in at the time the lump -sum payment is made. Members in
an acting position at the time of the lump -sum payment will receive
the amount for their acting classification, regardless of whether their
acting classification is within OMA. Part-time, benefitted employees
will receive a pro -rata share equivalent to their FTE classification in
Davroll at the time of the payment (e.g., a 25 -hour employee will
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ITEM 3 10/24/17
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receive 62.5% of the lump sum amount — 25 -hour employees are a
0.625 FTE).
If OMEA, OMCEA, and/or WDEA receive any increase in salary,
including base salary, lump sum payments, and/or step increases,
and/or medical insurance greater than this unit in the fiscal years
covered by the New MOU, then this unit shall receive the same.
Medical Insurance
Modify Article XVI, Section 1B of the MOU to provide that the City's
contribution shall be increased by $75 effective January 1, 2018 and
increased by an additional $75 effective January 1, 2019.
Effective Dates monthill
Current $1,460.00
January 1, 2018 $1,535.00
January 1, 2019 $1,610.00
Vacation Conversion
Effective July 1, 2017, an employee may convert up to 50% of his /her
current annual vacation accrual into cash in lieu of time off with pay
during the 2017 -2018 fiscal year. An employee requesting such a
conversion must meet the eligibility requirements as set forth in
Section 1, and may so convert twice during the 2017 -2018 fiscal year.
Effective July 1, 2018, an employee may convert up to 50% of his /her
current annual vacation accrual into cash in lieu of time off with pay
during the 2018 -2019 fiscal year. An employee requesting such a
conversion must meet the eligibility requirements as set forth in
Section 1, and may so convert twice during the 2018 -2019 fiscal year.
Effective July 1, 2019, an employee may convert up to 50% of his /her
current annual vacation accrual into cash in lieu of time off with pay
during the 2019 -2020 fiscal year. An employee requesting such a
conversion must meet the eligibility requirements as set forth in
Section 1, and may so convert twice during the 2019 -2020 fiscal year.
Educational/Wellness
(MOU Article XVII, New Section 4)
Reimbursement
Effective July 1, 2017, the parties agree to amend Article XVII,
Section 4 to provide as follows:
The City agrees to allow reimbursement to employees of up to
$375.00 of the $1,250.00 allotted per fiscal year towards
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8246957.1 OR020 -066
With the establishment of a Retirement Health Savings Plan Trust for this Association, the City
is required to enter into a new Administrative Services Agreement with ICMA Retirement
Corporation.
7. ATTACHMENTS
• Resolution No. 11029 (Letter of Understanding) — Exhibit "A"
• Lump Sum Allocation Table — By Classification — Appendix "A"
• Administrative Services Agreement with ICMA -RC
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reimbursement for items 1, 2 and/or 3 below. Requests must be
approved, prior to purchase or participation, by the Human Resources
Director.
1) Membership in a health /fitness club.
2) Participation in a weight loss /stop
smoking /wellness /fitness program.
3) Fitness equipment (home gym equipment).
The City will not reimburse employees for any of the above listed
activities for family /dependent health related expenses.
Retiree Health
Amend Article XVI, Section 4, to provide as follows:
Savings Plan
SECTION 4. Retirement Health Savings Plan Trust. The City will
establish and approve a Retirement Health Savings Plan Trust for
employees covered by this Memorandum of Understanding. The City
will not contribute to this plan, as all contributions of the Plan will be
borne by the employees. Once effective, all OMA employees are
required to participate in the plan by converting the value of the
following forms of compensation, on a tax - deferred basis, into their
savings account:
• 100% of eligible accrued Sick Leave cashout value upon
retirement from City service and entering the Public
Employees' Retirement System in accordance with Article
XIV, Section 4(H).
Language Changes
Implement mutually agreed language clean -up to conform MOU to
current practices or agreements.
With the establishment of a Retirement Health Savings Plan Trust for this Association, the City
is required to enter into a new Administrative Services Agreement with ICMA Retirement
Corporation.
7. ATTACHMENTS
• Resolution No. 11029 (Letter of Understanding) — Exhibit "A"
• Lump Sum Allocation Table — By Classification — Appendix "A"
• Administrative Services Agreement with ICMA -RC
RESOLUTION NO. 11029
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ORANGE ESTABLISHING A LETTER OF UNDERSTANDING
BETWEEN THE CITY OF ORANGE AND THE ORANGE
MANAGEMENT ASSOCIATION EFFECTIVE JULY 1, 2017
THROUGH DECEMBER 31, 2019
WHEREAS, the City of Orange, hereinafter referred to as "City," and the Orange
Management Association have met and conferred in accordance with the requirements of
the Meyers - Milias -Brown Act; and
WHEREAS, the City and the Orange Management Association have reached
agreement on wages, salaries, and other terms and conditions of employment effective
July 1, 2017 through December 31, 2019; and
WHEREAS, the City Council of the City of Orange has consulted with its Chief
Negotiator concerning the proposed employment terms contained in the attached Letter
of Understanding;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
Orange that the attached Letter of Understanding is approved and incorporated by
reference as Exhibit "A."
ADOPTED this d ay of October 2017.
Teresa E. Smith, Mayor of the City of Orange
ATTEST:
Mary E. Murphy, City Clerk of the City of Orange
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CITY COUNCIL MINUTES OCTOBER 24, 2017
3. CONSENT CALENDAR (Continued)
3.20 Approval of the submittal of funding applications to the Orange County
Transportation Authority. Resolution No. 11027. (T2200.0)
A Resolution of the City Council of the City of Orange approving the submittal of funding
applications to the Orange County Transportation Authority for funding under the
comprehensive transportation funding program.
ACTION: Approved Resolution No. 11027.
3.21 Letter of Understanding between the City of Orange and the Orange Management
Association (OMA) effective July 1, 2017, to December 31, 2019. Resolution No.
11029. (C2500.J.4.2.1)
A Resolution of the City Council of the City of Orange establishing a Letter of
Understanding between the City of Orange and the Orange Management Association
(OMA) effective July 1, 2017, to December 31, 2019.
ACTION: Approved Resolution No. 11029.
3.22 Letter of Understanding between the City of Orange and the Orange Water Division
Employees' Association effective July 1, 2017, to December 31, 2019. Resolution No.
11030. (C2500.J.4.4.1)
A Resolution of the City Council of the City of Orange establishing Letter of
Understanding between the City of Orange and the Orange Water Division Employees'
Association effective July 1, 2017, to December 31, 2019.
ACTION: Approved Resolution No. 11030.
3.23 Letter of Understanding between the City of Orange and the Orange Maintenance
and Crafts Employees' Association (OMCEA) effective July 1, 2017, to December 31,
2019. Resolution No. 11035. (C2500.J.4.4)
A Resolution of the City Council of the City of Orange establishing a Letter of
Understanding between the City of Orange and the Orange Maintenance and Crafts
Employees' Association effective July 1, 2017, to December 31, 2019.
ACTION: Approved Resolution No. 11035.
3.24 Letter of Understanding between the City of Orange and the Orange City Fire
Fighters, Inc. Local 2384 of the International Association of Fire Fighters, AFL -CIO
effective July 1, 2017, to June 30, 2019. Resolution No. 11036. (C2500.J.4.3)
A Resolution of the City Council of the City of Orange establishing a Letter of
Understanding between the City of Orange and the Orange City Fire Fighters, Inc. Local
2384 of the International Association of Fire Fighters, AFL -CIO effective July 1, 2017, to
June 30, 2019.
ACTION: Approved Resolution No. 11036.
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