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Legislative Public Meetings

File #: 21-47    Version: 1 Name:
Type: Study Session Status: Agenda Ready
File created: 1/4/2021 In control: Council and Authorities Concurrent Meeting
On agenda: 2/9/2021 Final action:
Title: Presentation and Discussion on City Retirement Costs by Bartel & Associates LLC
Attachments: 1. Bartel Associates, LLC Report, 2. POST MEETING MATERIAL
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Presentation and Discussion on City Retirement Costs by Bartel & Associates LLC

Enhance Community Engagement and Transparency

In December 2020, the City of Santa Clara contracted with Bartel Associates, LLC (Bartel), to conduct an actuary study on the City's CalPERs pension costs and determine future contribution rates. The City has worked with Bartel for over ten years during which time the firm has provided valuable information for projecting retirement costs including those used for our 10-year forecast. Bartel has over 300 clients, primarily in California, and specializes in providing states, counties, cities, and other public agencies with actuarial analysis including retiree medical and pension consulting services. Bartel is highly regarded across the region with municipal finance professionals and regularly presents on retirement and pensions at conferences and events.

Across all CalPERS cities in the State, pension costs continue to be a concern. Bartel will present and discuss the City's retirement costs with the City Council as part of a Study Session. The Study Session is designed to inform and engage the Council about the rising cost of pensions, the trends and actions that have led to where we are today, and what is forecasted ahead. The impact of some of the key data elements that will be discussed include:
* Pension costs forecast, and the projected rate of increase over the next 10 years;
* CalPERS discount rate assumption decreasing from 7.5% to 7.0% over three years (full impact to be realized in FY 2024/25) and the likelihood of future discount rate reductions as part of a risk mitigation strategy; and
* Unfunded liability increases for both pension plans from the previous year.

The update to the 10-Year General Fund Forecast incorporated these updated projections and the latest pension costs will also be factored into the upcoming FY 2021/22 and FY 2022/23...

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