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Sec. 1713. Authority of City Council to Refund Costs Paid by Members of the Department of Airports Who Previously Transferred to Tier 6 Pursuant to Section 1704.
(a) Council Authority to Authorize Refunds to Tier 6 Members. The Council may, by ordinance adopted in accordance with the provisions of this section, and pursuant to applicable provisions of the Charter and the Los Angeles Administrative Code, authorize a refund to a person, actively employed as a Member of the Department of Airports on January 12, 2025, who previously transferred to Tier 6 pursuant to Section 1704, and purchased any portion of their prior City service or Tier 6 health benefits pursuant to any existing provisions of the Los Angeles Administrative Code. For purposes of this section, such Tier 6 Members shall be referred to as “Qualifying Tier 6 Member(s).”
(b) Limitations on Authority to Provide Refunds.
(1) Cost Neutrality for Plan. The City shall be required to issue payment to the Plan in an amount that covers the full cost of refunds that will be issued to Qualifying Tier 6 Members pursuant to any ordinance adopted pursuant to this section. The City shall make this payment in advance of the Plan’s issuing any refunds, and it may be made at the same time as the City’s first annual contribution to the Plan that immediately follows the effective date of the ordinance adopted pursuant to this section.
(2) Payment Source and Method. Notwith-standing any language to the contrary in Section 1704(b)(3), the Plan shall refund to a Qualifying Tier 6 Member all monies paid to purchase any portion of City service or Tier 6 health benefits pursuant to any existing provisions of the Los Angeles Administrative Code, whether purchased by a lump sum or payment plan. All payments issued pursuant to this subsection shall be made prior to a Qualifying Tier 6 Member’s separation in a manner consistent with the Internal Revenue Code, either as a rollover, a trustee-to-trustee transfer, or a post-tax payment. Any personal tax consequences will be borne by the Qualifying Tier 6 Member.
(3) No Interest. Notwithstanding any language to the contrary in Section 1714 or in any existing provisions of the Los Angeles Administrative Code, the Plan shall not pay interest on any refund issued pursuant to this section, other than interest calculated according to Section 1714(c) that is attributable to a refund authorized by this section.
(4) Termination of Payment Plans. Effective January 12, 2025, any payment plan between the Plan and a Qualifying Tier 6 Member entered into pursuant to any existing provisions of the Los Angeles Administrative Code shall be terminated. The balance of any outstanding payments owed by a Qualifying Tier 6 Member to purchase prior City service pursuant to any existing provisions of the Los Angeles Administrative Code shall be forgiven and no longer owed.
SECTION HISTORY
Added by Charter Amendment FF, approved November 5, 2024, effective January 8, 2025.
(a) Contribution Amounts. Each Tier 6 Plan Member shall contribute to the Fire and Police Pension Plan-Tier 6 as follows:
(1) Regular Contributions. Each Tier 6 Plan Member shall make regular contributions to the Fire and Police Pension Plan – Tier 6 by salary deduction at the rate of 9% of the amount of his or her salary, except that further contributions to the Plan shall not be required from a Tier 6 Plan Member who has served as a Plan Member more than 33 years.
(2) Additional Contributions to Support Funding of Retiree Health Benefits. Each Tier 6 Plan Member shall make additional contributions to the Fire and Police Pension Plan – Tier 6 by salary deduction at the rate of 2% of the amount of his or her salary, except that further contributions to the Plan shall not be required from a Tier 6 Plan Member who has served as a Plan Member more than 25 years. The purpose of these contributions is to provide additional employee funding for service pensions in order to support the City's ability to fund retiree health benefits. This 2% member contribution shall not be increased by ordinance.
For purposes of determining the amount of these deductions, Salary shall mean those elements of a Tier 6 Plan Member's compensation which would be included in calculating Final Average Salary. The administrative heads of the Fire Department, Police Department, Harbor Department, and Airport Department shall cause to be shown on each and every payroll of such departments all deductions that are required to be made pursuant to this subsection for Department Members who are Tier 6 Plan Members. All references in Tier 6 to contributions shall be deemed to include both regular contributions and additional contributions, unless a different meaning is clearly indicated in the context.
(3) Internal Revenue Code Requirements for Contributions by Members Who Transferred From LACERS Pursuant to Sections 1703, 1704, or 1709. Notwithstanding any language in subsection (a) to the contrary, a Tier 6 Plan Member who elected to transfer into the Plan pursuant to Charter Sections 1703, 1704 or 1709 and the ordinances adopted in accordance therewith shall continue to make member contributions at the rate applicable to his or her LACERS membership to the extent required by the Internal Revenue Code, provided however: (i) if this subsection (a) would otherwise require additional member contributions by such a member, such additional member contributions shall be made by the member on an after-tax basis to the extent required by the Internal Revenue Code; and (ii) provided further, if this subsection (a) would otherwise require member contributions at a rate that is lower than the rate applicable to the member’s LACERS membership, the Council may, by ordinance adopted in accordance with the provisions of this section, and pursuant to applicable provisions of the Charter and the Los Angeles Administrative Code, provide for a larger annuity benefit at the time of retirement for such a member to reflect the additional contribution amounts, as determined by the actuary and subject to all limitations of the Internal Revenue Code.
(b) Payroll Deductions and Years of Service Credit for Overtime. Whenever a Plan Member, for overtime work, shall take a period of time off with pay:
(1) deductions for pension purposes, as provided in subsection (a), shall be made from such pay but only in the same amount as that which would have been deducted from his or her salary if such period had been one of regular work; and
(2) such period shall be part of his or her Years of Service.
Whenever a Plan Member, for overtime work, shall receive a cash payment:
(1) deductions for pension purposes shall not be made from such payment; and
(2) the period of overtime work for which he or she shall receive such payment shall not be part of his or her Years of Service.
(c) Member Accounts. The Board shall maintain an individual account for contributions that are made by or for each Tier 6 Plan Member, as hereinabove provided. Regular interest shall be credited to such individual accounts as of the last day of June and December of each year at such rate as the Board may deem proper in light of the Fire and Police Pension Plan's earnings, exclusive of profits and losses on principal heretofore or hereafter resulting from sales of securities. No such interest shall be credited at any other time or to the individual account of any person who is not a Tier 6 Plan Member but such interest shall be credited to the end of the pay period preceding termination, using the last interest rate used for the preceding June or December for crediting the Plan Member's individual accounts. A former Plan Member who did not receive a refund of his or her contributions and who re-enters service and becomes a Tier 6 Plan member shall, upon re-entry, be credited with interest on his or her account as if he or she had never terminated service.
(d) Payroll Deduction. Each Tier 6 Plan Member shall be deemed to consent and agree to each deduction made as provided for herein and the payment of each payroll check to such Plan Member shall be a full and complete discharge and acquittance of all claims and demands whatever for the services rendered by each member during the period covered by such payroll, except such claims as such Plan Member has to the benefits or payments provided for in this Tier 6.
(e) Election of Refund Forfeits Right to Benefits. Upon termination of employment as a Department Member for any reason except retirement, a terminated member may elect to receive a refund of contributions, together with accrued interest. Tier 6 Plan Members or beneficiaries thereof who elect to receive a refund of contributions, forfeit the right to benefits provided in this Tier 6. A terminated member who elected to have contributions returned, but who re-enters service and again becomes a Tier 6 Plan Member, shall have the privilege of regaining the prior service credit by repaying the amount of his or her previously refunded contributions and interest and an amount calculated as interest which would have been earned between the date of original termination of status as a Tier 6 Plan Member and the date of re-entry into service as a Department Member.
(f) Payment of Benefits Forfeits Right to a Refund. After payment of any pension benefit has commenced, the Tier 6 Plan Member or beneficiaries forfeit the right to a refund of the Plan Member's contributions. Tier 6 Plan Members who are restored to active duty from a disability pension may not thereafter have contributions made by them prior to their retirement on such disability pension refunded.
(g) Assuring Full Member Contributions. The Board shall have rule-making authority to ensure that the Fire and Police Pension Plan - Tier 6 receives member contributions for all periods of credited service, except that the Board shall not have authority to require contributions for service credit for military service and for periods while a Tier 6 Plan Member is receiving a disability pension, or full pay for Injury On Duty. Tier 6 Plan Members, however, may elect to make contributions for periods of Injury On Duty compensated at the rate provided by general law in order to acquire credit for Years of Service for such period. Such contributions shall be at the contribution rate herein provided and shall be based on the salary the Plan Member would have received if he or she had not occupied Injury On Duty status.
SECTION HISTORY
Added by Charter Amendment G § 1, approved March 8, 2011, effective April 8, 2011.
Amended by: Subsecs. (a)(2) and (a)(3), Charter Amendment SSS §§ 18, 19, approved November 8, 2016, effective December 15, 2016; Subsecs. (a)(3) and (g), Charter Amendment FF, approved November 5, 2024, effective January 8, 2025.
(a) Determination of Cost of Living Adjustments. The Board, before May 1 of each year commencing with the year 2012, shall determine the percentage of the annual increase or decrease in the cost of living as of March 1 of that year from March 1 of the preceding year as shown by the Consumer Price Index for All Urban Consumers as published by the Bureau of Labor Statistics or such other index as the Federal Government may develop to replace the All Urban Consumers Index for the area in which the City is located. If any such index were not to reflect the cost of living as of a particular March 1, then the index for the closest preceding date shall be used.
(b) Annual Cost of Living Adjustments.
(1) Commencing as of July 1 of the year in which the Board shall determine the percentage of increase or decrease in the cost of living, the monthly amounts of all pensions granted pursuant to the provisions of this Tier 6, shall be increased or decreased by reason of such determined percentage of increase or decrease in the cost of living, not to exceed an increase or decrease of 3% in any given year. Pensions which became payable before July 1, but subsequent to the preceding July 1, will be adjusted on a prorated basis whereby one-twelfth of the annual adjustment shall be applied for each completed month since such pension commenced. In no event shall pensions adjusted hereunder ever be decreased below the amount received by the Beneficiary when such pension first became payable to him or her.
(2) If the percentage of increase in the cost of living, as determined by the Board in accordance with subsection (a), were to exceed three percent (3%), the percentage of increase in the cost of living in excess of three percent (3%) shall be accumulated and carried over and added to the retiree's "COLA bank". In subsequent years, should the Board determine, based upon the applicable index, that the cost of living increase is below three percent (3%), an additional percentage, if available in such COLA bank, will be withdrawn from the retirees' COLA bank and applied to that current year's cost of living increase or decrease, up to the maximum of three percent (3%).
(c) Discretionary Cost of Living Adjustments. To the extent that the annual cost of living adjustments provided by subsection (b) hereof are less than the annual change in the cost of living as determined in subsection (a) hereof, the Council may grant discretionary cost of living adjustments, in addition to the annual cost of living adjustments provided by subsection (b) hereof, subject to the following conditions and requirements:
(1) No More Than Every Three Years. Discretionary adjustments may not be provided more frequently than once every three years, counting from the date the last discretionary adjustment became effective.
(2) Limit of Adjustments. Discretionary adjustments shall not exceed one-half of the difference between the percentage of the annual increases in the cost of living, as determined pursuant to the provisions of subsection (a) of this section, and the annual adjustments made pursuant to subsection (b) of this section for each of the preceding three years. Discretionary adjustments shall be allocated to each of the three years for which an adjustment is made. The adjustment may not exceed the percentage available in the retiree's COLA bank and upon application the additional percentage will be withdrawn from the retiree's COLA bank.
(3) Pensions Eligible for Adjustment. Discretionary adjustments herein provided shall be applied to pensions granted pursuant to Sections 1705, 1706 and 1708 subject to the following limitations: If a pension became payable on or after July 1 immediately preceding the effective date of such adjustment, it shall not be so adjusted; and any pension which shall have become payable at a time within the three year period (but prior to the immediately preceding July 1), shall be prorated on a monthly basis to the number of completed months for which the pension was received, provided that pensions paid pursuant to Section 1708(a)(3), (4) or (5), or Section 1708(c), (d) or (e), shall be adjusted by basing eligibility on the date upon which the Retired Plan Member's pension became effective.
(4) Report to Council Prior to Adoption by Ordinance. Discretionary cost of living adjustments may be provided only by ordinance. Ordinances providing discretionary adjustments may not be finally adopted until the Council has first obtained and published a report from the actuary or actuaries of the Fire and Police Pension Plan – Tier 6 indicating the present value of the liabilities that will be created by the proposed discretionary adjustment. This report must identify the annual funding cost of amortizing this liability pursuant to the amortization policies adopted by the Board.
(5) Vote by Council. Ordinances adopted pursuant to this subsection must be by not less than two-thirds of the membership of the Council, subject to the veto of the Mayor and re-adoption by the Council by not less than three-fourths of the membership of Council. No such ordinance may be finally adopted by the Council until the expiration of at least 30 days after its first presentation to the Council, nor until after a public hearing has been held thereon. Ordinances adopted pursuant to this subsection, shall be published no later than November 30, and shall become effective January 1.
(6) Prospective Application. All adjustments provided in this subsection are to be applied prospectively only and shall not be understood to permit retroactive adjustments of pensions.
SECTION HISTORY
Added by Charter Amendment G § 1, approved March 8, 2011, effective April 8, 2011.
Amended by: Subsec. (c)(3), Charter Amendment SSS § 20, approved November 8, 2016, effective December 15, 2016.
(a) Purpose of this Section. It is the purpose of this section to enable the City Council to provide by ordinance a program or programs whereby persons receiving pensions pursuant to the provisions of Tier 6 may become eligible to have subsidy payments made on their behalf for health insurance, accident insurance, life insurance or health care plan coverage or coverage for any combination of such programs as determined by the Council and subject to such conditions of entitlement as may be set forth in any ordinance adopted in accordance with the provisions of this section.
(b) Mode of Adoption of Ordinance. Ordinances adopted pursuant to this section must be approved by not less than two-thirds of the membership of the Council, subject to the veto of the Mayor and readoption by the Council by three-fourths of the membership of the Council. No such ordinance may be finally adopted by the Council until the expiration of at least 30 days after its first presentation to the Council, nor until after a public hearing has been held thereon. Any ordinance adopted pursuant to this section shall go into effect upon its publication, but the terms of such ordinance, or portions thereof, may be operative at a later date or dates. Council shall, prior to approval of the ordinance, be advised in writing by an enrolled actuary as to the cost of the proposed benefits.
(c) Council Authority to Establish Subsidy Limitations. The Council may establish by ordinance the maximum subsidy payments for beneficiaries under any programs established by the Council pursuant to subsection (a), including appropriate limitations for employees receiving subsidies from other City plans.
(d) Administration of Subsidy Program. Any subsidy program adopted by ordinance pursuant to this section shall be administered by the Board. In furtherance thereof, the Board shall have the authority to contract for suitable programs as defined in subsection (a), to be made available to retired members or other beneficiaries, and shall have the power to adopt such rules as it deems necessary to administer such programs. Notwithstanding the foregoing provisions, the Board may authorize the Personnel Department to administer any program or part thereof established by ordinance pursuant to the provisions of this section, but the Board shall reimburse the General Fund of the City of Los Angeles for all necessary expenses incurred by the Personnel Department in administering these programs.
(e) Board Authority to Adjust Subsidy Amount. The Council may by ordinance authorize the Board to increase or decrease subsidy payments pursuant to factors, standards, and limitations prescribed in the ordinance.
(f) Subsidies for Tier 6 Disability Retirees With Less Than Ten Years of Service. The Council, by ordinance adopted pursuant to this section, shall provide a health subsidy at age 55 for Tier 6 Plan Members who retire on service-connected disability pensions with less than ten Years of Service. Such ordinance shall be adopted by the Council no later than June 30, 2011.
(g) Health Insurance Premium Subsidy for Tier 6 to be Provided on the Same Terms and Conditions as for the Other Tiers. In consideration of the additional 2% contribution that Tier 6 members are making, pursuant to Section 1714(a)(2), to provide additional employee funding for service pensions in order to support the City's ability to fund retiree health benefits, the City Council, by ordinance adopted pursuant to this section, shall provide a health insurance premium subsidy for Retired Tier 6 Plan Members on the same terms and conditions that apply to retired members of other Tiers as of the effective date of the Charter amendment establishing Tier 6. Such ordinance shall be adopted by the Council no later than June 30, 2011. The rights granted in this Subsection (g), however, may include appropriate limitations for employees receiving subsidies from other City plans as provided in Subsection (c) herein.
SECTION HISTORY
Added by Charter Amendment G § 1, approved March 8, 2011, effective April 8, 2011.
(a) The benefits payable to any person who becomes a Plan Member shall be subject to the limitations set forth in Section 415 of the Internal Revenue Code.
(b) If any of the provisions of Section 415 of the Internal Revenue Code should be repealed, the provisions of this section shall be deemed repealed to the same extent.
SECTION HISTORY
Added by Charter Amendment G § 1, approved March 8, 2011, effective April 8, 2011.
(a) The Final Average Salary taken into account to determine the benefits provided by Tier 6 shall not exceed the annual limit set forth in Section 401(a)(17) of the Internal Revenue Code and regulations thereunder for any Plan Year. This annual compensation limitation shall be adjusted automatically for each Plan Year to the amount prescribed by the Secretary of the Treasury or the Secretary's delegate.
(b) If any of the limitations of Section 401(a)(17) should be repealed, the provisions of this section shall be deemed repealed to the same extent.
SECTION HISTORY
Added by Charter Amendment G § 1, approved March 8, 2011, effective April 8, 2011.
(a) Rules for Recall to Active Duty. The Appointing authority of the department shall promulgate rules and set standards as he or she may deem necessary or desirable with respect to recalling a Retired Tier 6 Member to active duty.
(b) Conditions for Recall to Active Duty. A Retired Tier 6 Plan Member, whenever retired, shall be eligible to be recalled to active duty in the department from which he or she retired only upon the following conditions:
(1) Service Retirement and Former Rank. That his or her original retirement had been pursuant to Section 1705 and had been from the Fire Department while holding a rank lower than Fire Chief or from the Police Department while holding a rank lower than Chief of Police or from the Harbor Department while holding a rank lower than Port Warden;
(2) Certification. That he or she had certified, in writing, that he or she had read and understands the provisions of this section; and
(3) Consent to Recall. That he or she voluntarily consented to be recalled to active duty.
(c) Limitations on Recall. The Appointing Authority may recall a retired member to active duty:
(1) Rank at Retirement. Only in or to a vacant position in the rank held by him or her at the effective date of his or her original retirement;
(2) 90 Day Limit. For not to exceed 90 days in any one calendar year; and
(3) Status defined in the Section. The salary, benefits and other terms and conditions of employment of any recalled member shall be provided under Subsections (e) and (f) of this section.
(d) No Recall of Police Exceeding 12 Months Without Loss of Pension. Recall of retired members of the Police Department may be approved for a period in excess of 90 days but not for more than 12 consecutive months, without loss of pension, in which case the salary, benefits and other terms and conditions of employment for the recalled police officers shall be established by ordinance. After a Retired Tier 6 Plan Member has been recalled under this provision for a period in excess of 90 days, he or she may not be recalled again under this provision until at least six months have passed since the date he or she last served under the prior recall.
(e) Status of Recalled Members. A retired member if he or she were to be recalled to active duty, thereafter shall be known as a "recalled member" and as such:
(1) His or her recall to active duty shall be a privilege only and the Appointing Authority may terminate his or her service at any time;
(2) His or her pension shall be paid during the period of his or her recall to active duty;
(3) He or she shall be paid the salary provided for his or her rank and the longevity pay or merit pay provided for his or her aggregate years of service prior to the effective date of his or her original retirement;
(4) He or she shall have no deductions made for pension purposes, pursuant to Section 1714 related to member contributions to Tier 6, from his or her salary and longevity pay or merit pay; and
(5) He or she, the surviving spouse or domestic partner, minor child or children or dependent parent or parents never shall be entitled to any pension benefits provided by this Tier by reason of his or her service as a recalled member.
(f) Tier 6 Construed with Recalled Member Rules. The provisions of this Tier 6 shall be construed and applied, as to a recalled member, his or her surviving spouse or domestic partner, minor child or children and dependent parent or parents, in accordance with the respective applicable provisions of subsection (e) of this section.
SECTION HISTORY
Added by Charter Amendment G § 1, approved March 8, 2011, effective April 8, 2011.
Amended by: Subsec. (b)(1), Charter Amendment SSS § 21, approved November 8, 2016, effective December 15, 2016.
(a) Implementation Procedure for Social Security Participation. Should Social Security participation be mandated or made available to Plan Members by federal legislation amending the Social Security Act or by action taken by the City or by Plan Members as provided by law, the following provisions shall govern the manner in which such participation by Plan Members is to be implemented and the limitations hereinafter set forth shall be controlling unless federal law is contrary to these provisions, is in conflict therewith and is clearly intended to be preemptive. Should applicable provisions of federal law in any respect differ from the provisions contained in this section and should they be determined to be preemptive as to any part thereof, then and in that event, those provisions of this section not affected by such federal law shall remain in full force and effect.
(b) Council Authority to Coordinate Benefits and Contributions. As to the rights and entitlement to benefits of Plan Members participating in such Social Security coverage, the Council shall have the power and authority, subject to the veto of the Mayor, to adopt ordinances modifying the benefits and conditions of entitlement provided in this Tier 6, including adjustments of Plan Member contributions to the Fire and Police Pension Plan – Tier 6 as hereinafter more specifically provided and subject to the limitations stated herein.
(c) Supermajority Vote Required. Ordinances adopted pursuant to this section must be approved by not less than two-thirds of the membership of the Council, subject to the veto of the Mayor and re-adoption by the Council by a vote of not less than three-fourths of the membership of Council. No such ordinance may be finally adopted by the Council until the expiration of at least 30 days after its first presentation to the Council, nor until after a public hearing has been held thereon. Any ordinance adopted pursuant to this section shall go into effect upon publication.
(d) Integration of Social Security and Pension Plan. Any participation in Social Security coverage shall be by integration with the benefits provided by this Tier 6 and shall not be in addition to the benefits provided in the Fire and Police Pension Plan – Tier 6. Integration is to be defined in harmony with the provisions of the Social Security Act and must be in substantial compliance with the rules and regulations governing the Act. Benefits provided by an integrated system must be at least equal to the benefits offered by the Fire and Police Pension Plan – Tier 6 prior to such integration. The level of integration may be periodically adjusted by the Mayor and Council to ensure an adequate level of integration.
(e) Minimum Plan Member Contributions. Plan Members participating in Social Security shall have their contributions to the Fire and Police Pension Plan reduced but Plan Members must contribute at least 5% of salaries to the integrated Fire and Police Pension Plan – Tier 6.
SECTION HISTORY
Added by Charter Amendment G § 1, approved March 8, 2011, effective April 8, 2011.