april 13-16, 2016 how to prepare for and survive a calpers ... · april 13-16, 2016 how to prepare...

APRIL 13-16, 2016

How to Prepare for and Survive a CalPERS Review Renee Ostrander, Chief

Anthony Suine, Chief

THESE MATERIALS HAVE BEEN PREPARED BY CalPERS

THEY HAVE NOT BEEN REVIEWED BY STATE CASBO FOR APPROVAL, SO THEREFORE ARE NOT AN OFFICIAL STATEMENT OF CASBO

2016 CASBO ANNUAL CONFERENCE & CALFORNIA SCHOOL BUSINESS EXPO 2

CalPERS Reviews

• Increased reviews over the last few years

• Anticipating additional increases in coming years

• Anticipating different “focus” reviews


CalPERS Review

• Objectives of a review

• How employers are selected

• Benefits to employer and employees


Common Audit Findings - Membership

• Enrollment • Immediate Membership • Temporary Employee Eligibility • Prior Membership

•Member Reciprocal Self Certification Form


Common Audit Findings - Membership

• Incorrect Enrollment of Affiliated Agency Employees • Common Law Employment • Correction of CalPERS Retirement Enrollment and

Payroll


Common Audit Findings - Compensation

•Classic/New • Pensionable Compensation Regulations • Interim Reporting

•Publicly Available Pay Schedules


Common Audit Findings - Compensation

• Special Compensation • Uniform Allowance • Bonus • Longevity Pay • Holiday Pay • Temporary Upgrade • Final Settlement Pay


Common Audit Findings – Post Retirement

• Limited duration • GC 21221(h)

• GC 21224

• 180-day wait period • Exclusions apply

• Resolution can be filed

• No waiver for Retirement Incentive

• 960 hour maximum per fiscal year, regardless of position • No exceptions


Common Audit Findings – Post Retirement (cont.)

• Retiree compensation • Salary must be within posted salary range

• No additional benefits

• Independent Contractor vs. Employee • Common Law Control Test

• Retired annuitants should be enrolled in mylCalPERS • Allows for validation of wait period(s)

• Tracks hours worked to ensure compliance


Closing a Finding – Documentation Required

• Publicly available pay schedule

• Labor agreements/Memorandum of understanding (MOU)

• Employment Contracts

• Board Meeting Minutes


Closing a Finding – Documentation Required

• Employer Resolutions

• Personnel Action Form (PAF)

• Job Duty Statement

• Payroll Information

• Other


Resources – Circular Letters

• 200-062-12 • Details of Pensionable Compensation for New Members

• 200-065-14 • Common Membership Findings in Employer Reviews

• 200-064-14

• Common Compensation Findings in Employer Reviews

• 200-002-14

• Post Service Retirement Employment Requirements


Resources - Other • [email protected]

• [email protected]



• CalPERS Publications • Employment After Retirement (Pub 33)

• Reinstatement From Retirement (Pub 37)

• CalPERS Website • 180-day wait period resolution samples

mailto:[email protected]





Questions?

APRIL 13-16, 2016

CalPERS Current Topics and Issues Renee Ostrander, Chief

Anthony Suine, Chief

THESE MATERIALS HAVE BEEN PREPARED BY CalPERS

THEY HAVE NOT BEEN REVIEWED BY STATE CASBO FOR APPROVAL, SO THEREFORE ARE NOT AN OFFICIAL STATEMENT OF CASBO


Retirement Options Simplification Current State

• 13 Retirement Options: 6 statutory, 7 regulatory (Option 4s)

• Statutory Options

• Unmodified - Highest Benefit Payable

• Option 1 - Return of Member Contributions

• Option 2W - 100% Joint Lifetime Benefit

• Option 2 - 100% Joint Lifetime Benefit with pop up if bene dies first

• Option 3W - 50% Joint Lifetime Benefit

• Option 3 - 50% Joint Lifetime Benefit with pop up if bene dies first


Retirement Options Simplification

Current State (cont.)

• Regulatory Options

• Reduction upon Death of Retiree or Named Beneficiary

• Reduced Allowance for a Fixed Period of Time

• Specific Percentage to a Beneficiary

• Specific Dollar Amount to A Beneficiary

• Multiple Lifetime Beneficiaries

• Option 3W and Option 1 Combined

• Option 2W and Option 1 Combined


Retirement Options Simplification

Evaluation Criteria

• Cost Effectiveness Measurement Benchmarking

• Option Election Frequency

• Option Election Similarities

• Member and Beneficiary Impact

• Administrative and CalPERS Staff Impact

• Legislative and Regulatory Impact

• Board Authority


Retirement Options Simplification - AB2404

Recommendation

Unmodified

Option 1

Option 2w+1

Option 3w+1

Flexible Beneficiary Option

Benefits Challenges

Extreme member simplification Legislative requirements

Mitigate member risk my|CalPERS system changes

Simplified administration Staff education

Reduce actuarial risk Member education and materials

Consistent options with CEM Peer Group Temporary increase in inquiries


Charter School Updates

• IRS/Treasury Dept Draft Regulations • Public Agency Questionnaire

• Denials

• Pending Reviews

• Relief Notice

• Revised Review Process • New School Questionnaire

• Certification Form

• Current Service Levels


Payroll Updates

• Circular Letter 200-014-16

• Verification of Payrates • $20,000 – Employer Verification

• $30,000 – Employer and CalPERS Verification

• Identification of Special Compensation • Payrate and Special Compensation Separated

• No Unknown


Reporting as Earned – GC 20636.1

180 work days at 8 hours 1,440

15 vacation days 120

12 holidays 96

Total hours 1,656

Contract Date 8/23/15 - 6/11/16

Contract Amount $24,840

1,656 hours at $15/hour = $24,840

Full Time Monthly Pay Rate would be $2,600 ($15 * 173.33 hours)

Full Time is 173.33 hrs/mo, 2,080 hrs/yr or 260 days/yr


Reporting as Earned - Incorrect Reporting

MonthPay

RateMember Earnings

Sevice Credit

Earned

July $0.00 $0.00 0.000

August $0.00 $0.00 0.000

September $2,600.00 $2,484.00 0.960

October $2,600.00 $2,484.00 0.960

November $2,600.00 $2,484.00 0.960

December $2,600.00 $2,484.00 0.960

January $2,600.00 $2,484.00 0.960

February $2,600.00 $2,484.00 0.960

March $2,600.00 $2,484.00 0.960

April $2,600.00 $2,484.00 0.960

May $2,600.00 $2,484.00 0.960

June $2,600.00 $2,484.00 0.960

Totals $26,000.00 $24,840.00 9.6

Final Compensation = $26,000/12 = $2,167


Reporting as Earned - Correct Reporting Method #1

MonthPay

RateMember Earnings

Sevice Credit

Earned

July $0.00 $0.00 0.000

August $2,600.00 $960.00 0.369

September $2,600.00 $2,484.00 0.955

October $2,600.00 $2,484.00 0.955

November $2,600.00 $2,484.00 0.955

December $2,600.00 $2,484.00 0.955

January $2,600.00 $2,484.00 0.955

February $2,600.00 $2,484.00 0.955

March $2,600.00 $2,484.00 0.955

April $2,600.00 $2,484.00 0.955

May $2,600.00 $2,484.00 0.955

June $2,600.00 $1,524.00 0.586

Totals $28,600.00 $24,840.00 9.6



MonthPay

RateMember Earnings

Sevice Credit

Earned

July $0.00 $0.00 0.000

August $2,600.00 $2,258.00 0.868

September $2,600.00 $2,258.00 0.868

October $2,600.00 $2,258.00 0.868

November $2,600.00 $2,258.00 0.868

December $2,600.00 $2,258.00 0.868

January $2,600.00 $2,258.00 0.868

February $2,600.00 $2,258.00 0.868

March $2,600.00 $2,258.00 0.868

April $2,600.00 $2,258.00 0.868

May $2,600.00 $2,258.00 0.868

June $2,600.00 $2,258.00 0.868

Totals $28,600.00 $24,838.00 9.6


Reporting as Earned - Correct Reporting Method #2


Reporting as Earned - Retirement Calculation Comparison

Incorrect Method

• Benefit Factor =

2% x 20 = 40%

• Final Comp =

$2,167

• Retirement Allowance = $2,167 x 40%

= $866/month

Correct Method

• Benefit Factor =

2% x 20 = 40%

• Final Comp =

$2,383

• Retirement Allowance = $2,383 x 40%

= $953/month


Converting Hourly Pay Rates • Monthly Pay and Hours

• $20.00/hr @ 151 hours

• You Increase Pay Rate based on 40 hours per week (*173.33)

• $20.00 * 173.33 = $3,467 ($22.96)

• You report $22.96/hr @ 151 hours

• We Increase Pay Rate based on 40 hours per week (*173.33)

• $22.96 * 173.33 = $3,980 ($26.35)

• Final Compensation is now based on $26.35 per hour instead of $22.96


Questions?

april 13-16, 2016 how to prepare for and survive a calpers ... · april 13-16, 2016 how to prepare...

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