(a) Application. The provisions of this section shall not be applicable to any benefit payable to a member or former member, or to his or her beneficiaries, pursuant to the provisions of Section 4.1080.10(a)(2), concerning the limited pension. The provisions of this section, however, shall be applicable to each other benefit payable in monthly installments pursuant to any other provisions of this Article, but the application thereof to any such benefit shall not reduce the amount to be paid on or subsequent to July 1st of any year to an amount less than that payable immediately prior to July 1st of said year.
(b) Cost of Living Adjustments by Board of Administration.
(1) The Board of Administration, not later than the 1st day of May of each year, shall determine with respect to the Federal Bureau of Labor Statistics Consumer Price Index for the Los Angeles area (“the C.P.I.”) the percentage of increase or decrease, if any, in the C.P.I. for the whole of the first next preceding calendar year from the C.P.I. for the whole of the second next preceding calendar year and shall round any such percentage increase or decrease to the nearest one-tenth (1/10) of one percent (1%).
(2) The Board, whenever it shall have determined that there had been an increase or decrease in the C.P.I., shall increase or decrease the amount of each such benefit as hereunder provided, subject, however, to the limitations contained in Subsection (a) of this section:
Effective the 1st day of July of each year, the Board of Administration, with respect to each eligible benefit which became payable prior to the applicable 1st day of July, shall increase or decrease the amount thereof payable immediately prior to the applicable 1st day of July by one-twelfth (1/12) of the percentage of increase or decrease in the C.P.I. as determined by it pursuant to Subsection (b)(1) of this section, for each whole month that such benefit was payable during the year commencing the 1st day of July next preceding the applicable 1st day of July and ending the 30th day of June next preceding the applicable 1st day of July, providing that any increase or decrease in the amount of any such benefit shall not exceed one-twelfth (1/12) of two percent (2%) thereof for each whole month that it was payable during the year.
(3) If it is impossible or impracticable for the Board to cause all necessary calculations to be made in time for it to include any increases or decreases in the amounts of benefits, as hereinabove provided, in the demands drawn in payment of such benefits for the month of July in any year, then the Board shall have the power and authority, when such calculations shall have been made, to increase or decrease the amounts of the demands drawn in payment of such benefits for any month subsequent to the month of July so as to include any increases or decreases in such benefits which shall have accumulated from and after the 1st day of July.
(4) In contrast with the practice authorized for Tier 1 of the System, as provided by LAAC Section 4.1022(c)(2), nothing in this section shall be construed to authorize the accumulation or carrying over of any percentage increase or decrease in the C.P.I. from one calendar year to the next.
(c) Discretionary Cost of Living Adjustments by City Council.
(1) There is hereby created and established a policy whereby the City Council shall periodically review the matter of the cost of living adjustments for certain beneficiaries who receive retirement benefits from the Retirement System. The review shall be made to ascertain the impact of increases or decreases in the Consumer Price Index upon retirement benefits and the adequacy of the annual cost of living adjustments provided in subsection (b) herein.
Should the City Council find and determine that annual cost of living adjustments are inadequate in light of the movement of the Consumer Price Index, the City Council may grant additional, but discretionary, cost of living adjustments as hereinafter provided.
(2) The first of the reviews provided in Subsection (c)(1) herein shall be made during the third fiscal year following the date that the first beneficiary of Tier 3 receives a benefit that is subject to a cost of living adjustment, pursuant to Subsection (b) herein, and annually thereafter until the City Council has provided a first discretionary adjustment pursuant to this section. Thereafter, the City Council shall make periodic reviews in intervals not to exceed three (3) years from the date of the completion of the last review or from the effective date of the last discretionary cost of living adjustments, whichever shall be the later.
(3) Should it be the finding of the City Council that discretionary cost of living adjustments would be in order, any such adjustments would be subject to the following limitations:
(i) The first discretionary adjustment may be granted at any time. Thereafter, discretionary adjustments may not be provided more frequently than once every three (3) years, counting from the date the last discretionary adjustments became effective.
(ii) Discretionary adjustments shall not exceed one-half (1/2) of the difference between the percentage of the annual increases in the cost of living, as determined pursuant to the provisions of Subsection (g)(2) herein, for each of the preceding three (3) years and the annual adjustments made pursuant to Subsection (a). Discretionary adjustments shall be allocated to each of the three (3) years for which an adjustment is made.
(iii) Any discretionary cost of living adjustments provided pursuant to the provisions of this section shall be subject to the following further limitation: If a benefit became payable on or after July 1 immediately preceding the effective date of such adjustments, it shall not be so adjusted; and any benefit which shall become payable at a time within a three-year period between discretionary cost of living adjustments (but prior to the immediately preceding July 1), shall be prorated according to the annual increase, on a monthly basis, to the number of completed months for which the benefit was received.
(iv) Discretionary cost of living adjustments may be granted only by ordinances adopted in accordance with the provisions of Section 1168 of the City Charter.
(v) All adjustments provided in this subsection are to be applied prospectively only. Nothing in this section shall be understood to permit retroactive adjustments of benefits.
(vi) Only those monthly benefits which are entitled to cost of living adjustments as provided in Subsection (a) and (b) of this section are entitled to discretionary cost of living adjustments under Subsection (c) herein. Discretionary cost of living adjustments shall not be applied to monthly benefits excluded from receiving cost of living adjustments under any provision in this article.
(vii) It shall be the duty of the City Administrative Officer to prepare appropriate reports and recommendations to enable the City Council to make findings as to the adequacy of the annual cost of living adjustments.
SECTION HISTORY
Added by Ord. No. 184,134, Eff. 1-22-16.