STOCKTON — The San Joaquin County Board of Supervisors at its Tuesday meeting voted 5-0 to deny a complaint filed by the Deputy Sheriff’s Association alleging the county violated a contract regarding retirement benefits.
Isaac Stevens, an attorney representing the Deputy Sheriff’s Association, told supervisors that the Public Employees Pension Reform Act intervened in a contract between his clients and the county that changed a benefits formula from “3 percent at 50” to “2.7 percent at 57.”
The original formula, approved by the county and DSA in 2007, allows county retirees to collect 3 percent of their base salary for each year of service when they retire at the age of 50. However, when PEPRA was enacted in September of 2012, it mandated that on Jan. 1, 2013, each public employee retirement system shall modify their plans to comply with state law.
That law required agencies to reduce the percentage of an employee’s base salary in the formula, as well as increase the eligible age for retirement.
According to the California Public Employee Retirement System, PEPRA offered agencies three new formulas from which to choose.
PEPRA offered a formula that provides 2 percent of a base salary, 2.5 percent and 2.7 percent, all collectible when an employee turns 57 or older.
The new formula would be applied only to employees hired after Jan. 1, 2013. Employees hired before that date would still receive 3 percent of their base annual salary when they retire at 50.
Stevens said contract language requires the county to maintain a formula that would provide the original 3-at-50, and that there was nothing in said contract that requires a change in formula for new hires.
“We believe the intent of the (county and DSA) contract was to provide 3-at-50 for all members,” Stevens said. “But we do recognize PEPRA impaired that contract, and we’d like the county to acknowledge that.”
Jeffrey Sloane, an attorney representing the county, said no contract violation had been committed, because the county is following a law required by PEPRA.
“The language does not require 3-at-50 for all employees,” Sloan said.
“It says the county shall maintain a formula in accordance with government code. The county and its Employees Retirement Association are over-ridden by what’s set forth in PEPRA.”
The DSA filed its complaint on March 10, 2014, which was rejected by Undersheriff John Picone. The undersheriff told the DSA at that time that PEPRA superseded the contract.
The DSA then appealed to the County Administrator’s Office in April of that year, which reiterated that PEPRA requires new hires to be subject to a lower benefits tier.
The DSA then appealed that decision to supervisors in June.
Supervisor Steve Bestolarides said the DSA should have filed its complaint with the San Joaquin County Employee Retirement Association, which handles claims like this, rather than the board.
He added the DSA should have filed the complaint in January of 2013, when PEPRA went into effect.
However, Bestolarides said the county must follow the law set forth in PEPRA.
“PEPRA impacted all employees,” he said. “It wasn’t just for public safety. All public employees are subject to PEPRA after Jan. 1, 2013, which means all new hires are subject to a different tier.”
Vice Chairman Chuck Winn told Stevens the law changed, not the contract with the DSA.
“We don’t have any control over it. The retirement board doesn’t have control, and you don’t have control over it,” he said. “We’re required to follow the law. We have no choice.”
— Contact reporter Wes Bowers at (209) 546-8258 or email firstname.lastname@example.org. Follow him at blogs.esanjoaquin.com/san-joaquin-county-government-blog or on Twitter @WBowersTSR.