(a) Pursuant to Charter Section 1218, a deferred retirement option plan (DROP) is created and offered to members of the Fire and Police Pension Plan on a voluntary basis. DROP is an alternative method of benefit accrual in the Retirement System as set forth in this chapter.
(b) DROP is created to add flexibility to the Fire and Police Pension Plan. It provides members who elect to participate in the program access to a lump sum benefit in addition to their normal monthly retirement allowance at their actual retirement, which occurs when employment as a sworn member with the City is terminated. DROP is intended to be cost neutral regarding plan funding.
(c) The City reserves the right to suspend the right of members to enter the DROP program and to modify the program for future entrants as necessary to maintain cost neutrality and/or to meet the City's DROP goals of retaining and lengthening the careers of sworn personnel with the Police Department, Fire Department, Harbor Department, and Department of Airports. Any amendments to DROP enacted in accordance with this subsection will only affect those persons who enter DROP after the date the changes become effective.
The City has the right to complete an actuarial study of DROP in order to evaluate whether DROP continues to be cost neutral and to review DROP to determine whether DROP is meeting the City's DROP goals. An actuarial study and review of the City's DROP goals shall be completed by the City at least every five (5) years or more often. If the City determines changes to DROP are needed based on this review, the appropriate labor organizations shall meet and confer with the City immediately upon demand. Once the City and the labor organizations reach agreement, DROP shall forthwith be amended in accord with that agreement unless no changes to DROP are required.
If the City and the labor organizations do not agree upon changes to DROP within one hundred eighty (180) days of the date of the City's demand, then the City Administrative Officer shall so notify the Fire and Police Pension Plan in writing. However, if the City and the involved labor organizations mutually agree to extend negotiations for an additional period of time, not to exceed one hundred eighty (180) days, then the City Administrative Officer shall not provide this notice to the Fire and Police Pension Plan until the additional time has expired without the parties reaching agreement. Upon receipt of this written notice from the City Administrative Officer, the Fire and Police Pension Plan shall no longer allow members to enter DROP until the effective date of an ordinance enacted by the City Council amending DROP to allow new members to enter DROP while maintaining cost neutrality and otherwise meeting the City's DROP goals or until the City Administrative Officer notifies the Fire and Police Pension Plan in writing that the City has determined that no modifications to DROP are necessary at that time.
Chapter and Section Added by Ord. No. 174,540, Eff. 5-8-02.
Amended by: Subsec. (d) added, Ord. No. 177,900, Eff. 9-28-06; Subsec. (d), Ord. No. 179,750, Eff. 3-25-08; Subsec. (c) amended and Subsec. (d) deleted, Ord. No. 180,322, Eff. 11-7-08; Subsec. (c), Ord. No. 184,853, Eff. 4-6-17; Subsec. (c), Ord. No. 185,935, Eff. 1-23-19.