Resolution No. 2014-053RESOLUTION NO. 2014-53
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON AMENDING RESOLUTION NO. 2012-173 REGARDING
THE REIMBURSEMENT OF CERTAIN COSTS INCURRED BY
CURRENT VERNON CITY PERSONNEL IN CONNECTION WITH A
REVIEW BY THE CALIFORNIA PUBLIC EMPLOYEES'
RETIREMENT SYSTEM ("CALPERS")
WHEREAS, the California Public Employees' Retirement System
("CalPERS") Office of Audit Services conducted a public agency review
of the City of Vernon, the results and findings of which were outlined
in a report dated April 27, 2012 (the "Report"); and
WHEREAS, Ca1PERS notified certain current City of Vernon
personnel of preliminary and final determinations related to their
pension benefits based on the Report findings; and
WHEREAS, certain current City of Vernon personnel retained
independent legal counsel to assist in responding to and/or appealing
the Ca1PERS determinations, and requested reimbursement from the City
for such costs; and
WHEREAS, on September 4, 2012, the City Council of the City
of Vernon adopted Resolution No. 2012-173 (the "Resolution")
authorizing the reimbursement of certain costs incurred by current
Vernon City personnel in connection with responding to and/or appealing
the CalPERS' determinations; and
WHEREAS, Section 3 of the Resolution authorizes the
expenditure of General Fund monies to pay any costs, expenses, interest
and attorney's fees, not to exceed twenty-five thousand dollars
($25,000) per current employee, arising out of the hiring of legal
counsel to respond to and/or appeal the preliminary and final
determinations arising out of the Report findings; and
WHEREAS, by memorandum dated September 2, 2014, City staff
has requested authorization for up to an additional thirty thousand
dollars ($30,000.00) in reimbursable legal expenses for W. Michael
McCormick relating to his ongoing appeal of CalPERS' determination
arising out of the Report findings (CalPERS Case No. 2013-0899); and
WHEREAS, the City Council of the City of Vernon desires to
authorize the additional $30,000.00 in reimbursable legal expenses for
W. Michael McCormick.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
SECTION 1: The City Council of the City of Vernon hereby
finds and determines that the above recitals are true and correct.
SECTION 2: The City Council of the City of Vernon finds
that this action is exempt under the California Environmental Quality
Act (CEQA), in accordance with Section 15061(b)(3), the general rule
that CEQA only applies to projects that may have an effect on the
environment.
SECTION 3: The City Council of the City of Vernon hereby
approves and authorizes the additional $30,000.00 expenditure of
General Fund monies to pay any costs, expenses, interest and
attorney's fees, not to exceed a total of fifty-five thousand dollars
($55,000.00), in the matter of CalPERS Case No. 2013-0899.
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SECTION 4: The City Clerk, or Deputy City Clerk, of the
City of Vernon shall certify to the passage, approval and adoption of
this resolution, and the City Clerk, or Deputy City Clerk, of the City
of Vernon shall cause this resolution and the City Clerk's, or Deputy
City Clerk's, certification to be entered in the File of Resolutions
of the Council of this City.
APPROVED AND ADOPTED this 2nd day of September, 2014.
ATTEST:
Ana'lWrcia
Q1ry C / Deputy City Clerk
APPROVED AS TO FORM:
McCormickName: W. Michael
Title: Mayor / " ��
Zayn V goussa, Deputy City Attorney
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STATE OF CALIFORNIA )
) ss
COUNTY OF LOS ANGELES )
I Ana Barcia sty�/ Deputy City Clerk of the City
of Vernon, do hereby certify that the foregoing Resolution, being
Resolution No. 2014-53, was duly passed, approved and adopted by the
City Council of the City of Vernon at a regular meeting of the City
Council duly held on Tuesday, September 2, 2014, and thereafter was
duly signed by the Mayor or Mayor Pro-Tem of the City of Vernon.
Executed this __!5L day of September, 2014, at Vernon, California.
(SEAL)
/ Deputy City Clerk
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TRANSMITTAL COMMUNICATION
CITY CLERK'S OFFICE
INTEROFFICE MEMORANDUM
DATE: September 8, 2014
TO: William Fox, Finance Director/City Treasurer
Mark Whitworth, City Administrator
FROM: Deborah Juarez, Records Management Assistant
RE: Resolution No. 2014-53 — A Resolution of the City Council of the City of Vernon
Amending Resolution No. 2012-173 Regarding the Reimbursement of Certain Costs
Incurred by Current Vernon City Personnel in Connection with a Review by the California
Public Employees' Retirement System ("CALPERS")
Transmitted herewith is a copy of Resolution No. 2014-53 referenced above, which was approved by City
Council on September 2, 2014.
Thank you.
Attachment
c: Resolution No. 2014-53
STAFF REPORT
(%O' Sp���
STAFF REPORT
CITY ADMINISTRATION
DATE: September 2, 2014
Re JNJF,[)
NUG%�2014
cl.v CLERKS OFFICE
TO: Honorable Mayor and City Council
FROM: Mark C. Whitworth, City Administrator
RE: A Resolution of the City Council of the City of Vernon Amending Resolution
No. 2012-173 Regarding the Reimbursement of Certain Costs Incurred by
Current Vernon City Personnel in Connection with a Review by the
California Public Employees' Retirement System ("CalPERS")
Recommendations
It is recommended that the City Council:
1) Find that the approval of the resolution proposed in this staff report is exempt under the
California Environmental Quality Act (CEQA) in accordance with Section 15061(b)(3),
the general rule that CEQA only applies to projects that may have an effect on the
environment.
2) Adopt the attached resolution to authorize up to an additional $30,000 in reimbursable
legal expenses for Michael McCormick relating to his ongoing appeal of CalPERS'
determination arising out of the Report findings (CalPERS Case No. 2013-0899).
Background
In April 2012, CalPERS issued an audit report on the City of Vernon that contained certain
findings. Based on the findings in the report, CalPERS issued determination letters to certain
current employees regarding their pension benefits. Some of these employees, including Mayor
Michael McCormick, retained independent legal counsel to assist in responding to and/or
appealing their CalPERS' determinations, and requested reimbursement from the City for said
costs.
In September 2012, City Council adopted Resolution No. 2012-173, which authorized up to
$25,000 per current employee of reimbursable legal expenses incurred in connection with
responses to and/or appeals of the CalPERS' determinations arising out of the April 2012 audit
report findings.
In July 2012, Mr. McCormick received a formal compensation determination letter from
CalPERS. On August 28, 2012, Mr. McCormick's timely filed an appeal of said determination.
After some delay, an Administrative Hearing was ultimately set for and held on May 22, 2014.
Closing briefs in the Administrative Hearing were filed on June 6, 2014. On June 13, 2014, the
Administrative Law Judge ("ALF') who conducted the hearing submitted his Proposed Decision
to the CalPERS Board of Administration ("Board"), recommending the Board deny Mr.
McCormick's appeal. On August 20, 2014, the Board upheld the ALJ's decision to deny the
appeal.
Given the recent Board decision, Mr. McCormick's remaining option is to appeal the decision to
the Superior Court through a writ of administrative mandamus. The writ process will include
substantial legal research and analysis, as well as the preparation of written briefs in support of
Mr. McCormick's appeal. Mr. McCormick's current legal counsel has submitted a proposed
budget of $24,750 for this process, which is attached hereto.
As of August 19, 2014, Mr. McCormick has incurred and received reimbursement for legal
expenses totaling $27,374.99. This exceeds the currently authorized legal expense
reimbursement amount by $2,374.99. However, the additional reimbursement authorization
proposed in this staff report and the attached Resolution is inclusive of this amount. If the City
Council does not approve the proposed additional reimbursement authorization, staff will submit
a request for ratification of the $2,374.99 at a subsequent meeting.
Fiscal Impact
The $30,000 requested in this staff report was not included in the budget for fiscal year 2014-
2015, however, staff believes the cost can absorbed within the existing budget.
Attachment
RECEIVED
LAW OFFICE OF MICHAEL A. CONGER
Post Office Box 9374
16236 San Dieguito Road, Suite 4-14
Rancho Santa Fe, CA 92067
(858)759-0200
(858)159-1906 (fax)
web site: www.lowconger.com
email; congermike@aol.com
Michael A. Conger
PROPOSED BUDGET
McCormick v. CaIPERS
Prepared: August 26, 2014
Legal Fees: 65 hours @ $350 per hour
Costs: Filing fees, copies, postage, delivery, travel, etc.
Total:
AUG 2 6 2014
CITY ADMINISTRATION
Civil LI 11y¢allo.n
Employment
Business Low
Governmental Law
$22,750
2 000
2�4 750
Note: This is an estimate only based on prior experience in a similar
case. Actual costs may vary and shall be governed by the
retention agreement dated July 14, 2014.