Los Angeles Municipal Code Part 1 Los Angeles City Employees’ Retirement System

Section 1150 Los Angeles City Employees’ Retirement System (LACERS). 1152 Definitions. 1154 Retirement Fund. 1156 Transfer of Released Liability for Transferred Employees. 1158 Actuarial Standards. 1160 Budget. 1162 Contribution of Members. 1164 Employment by the City of a Retired Member of the System. 1166 Authority to Administer Other Retirement Plans. 1168 Establishment of Benefits by Ordinance. 1170 Benefits Not Assignable.

Sec. 1150. Los Angeles City Employees’ Retirement System (LACERS).

There is hereby created, established and adopted a retirement system for all officers and employees of the City of Los Angeles not now included within any other pension or retirement system under the provisions of this Article. The benefits of the System’s Plan shall be adopted by ordinance in accordance with Section 1168 of this Part 1 and shall be set forth in the City Administrative Code.

Sec. 1152. Definitions.

For the purpose of this Part 1 concerning the LACERS, the following words and phrases shall have the meaning ascribed to them in this section unless a different meaning is clearly indicated by the context:

(a) Accumulated Contributions: The total of the amounts paid into the fund by the member and any interest credited to the member’s account.

(b) Beneficiary: Persons entitled to receive a benefit from the Plan.

(c) Member: An employee of the City of Los Angeles who meets the membership requirements of the Plan as further defined in

ordinance(s) establishing the benefits of the Plan.

(d) Plan: The Los Angeles City Employees’ Retirement System as adopted by the Council under authority of Section 1168.

(e) Retired Member: A member who has ceased employment with the City of Los Angeles and is receiving a regular monthly

benefit payment from the Plan.

(f) Retirement Fund: The trust fund established for the LACERS separate and apart from the other money of the City.

(g) System: The Los Angeles City Employees’ Retirement System (LACERS).

Sec. 1154. Retirement Fund.

There shall be a fund known as Los Angeles City Employees’ Retirement Fund for the payment of administration expense, retirement allowances and other benefits of the System, which fund shall consist of all money paid into the fund in accordance with the provisions of this Part 1, and earnings from investments.

Sec. 1156. Transfer of Released Liability for Transferred Employees.

If any City function and System Members who perform that function are transferred to another public agency, and if the receiving public agency affords System Members the opportunity to secure retirement credit for their City service in that public agency’s retirement system, then the Released Liability to this System for the transferred System Members who elect to transfer their accumulated contributions from this System to the retirement system of the receiving public agency shall be made available for payment on account of the required employer contribution for the retirement system of the receiving public agency. The Released Liability shall be made available in the manner specified in the ordinance authorizing the transfer of the City function but in no event shall the amount of money made available exceed the required employer contributions on account of those System Members who request the transfer of their accumulated contributions.

For the purpose of this section, the phrase Released Liability shall mean the City’s share of the actuarially determined present value of benefits earned to the date of the transfer under the LACERS and shall be based upon the rates of withdrawal and other actuarial assumptions in effect on the date of the transfer and an assumed interest factor as determined by the Board of Administration which reflects, as closely as practicable, the interest rate at which member contributions and the City reserves were credited as provided in Section 1162 for the six-month period immediately preceding the date of the transfer.

Sec. 1158. Actuarial Standards.

(a) Reserve Basis. The Board of Administration shall adopt an actuarial report showing the cost of maintaining, upon a reserve basis, the System and Fund, and shall, at intervals of not to exceed five years, cause to be made an actuarial investigation into the mortality, service, and compensation experience of the members and beneficiaries, and shall further cause to be made an actuarial valuation of the assets and liabilities of the Retirement Fund. The board shall keep in convenient form any data necessary for the actuarial valuation of the Retirement Fund established in Section 1154.

(b) Setting Actuarial Assumptions. Upon the basis of the investigation and valuation, the Board of Administration shall:

(1) adopt for the System an interest rate and mortality, service and other tables as deemed necessary by the board; and

(2) revise or change the rates of the City contributions on the basis of these mortality, service and other tables.

(c) Records. In addition to other records and accounts, the board shall keep any records and accounts necessary to show at any time:

(1) the total accumulated contributions of the Members, both individually and collectively;

(2) the total accumulated contributions of Retired Members, less the total annuity payments made to such retired members; and

(3) separately the amounts paid into the fund by the City on account of that part of the cost of the System to be borne by the City.

(d) Annual Report. The board shall prepare at the close of each fiscal year a financial statement showing the assets and liabilities of the Retirement System and Fund.

Sec. 1160. Budget.

(a) Transmittal of Budget. The board shall annually prepare and transmit to the Mayor and Controller a budget setting forth the estimated cost of maintaining the Retirement Fund. The budget shall include separate items as follows:

(1) City Contributions. A sum equal to a percentage of the salaries of all members of the retirement system, which percentage shall

be the same as that shown in the last actuarial report rendered, as herein before provided to be the percentage required for members of departments with no past service.

(2) Liquidation of Unfunded Liabilities. A sum sufficient to liquidate, over a period of up to 30 years, any accrued unfunded

liabilities assumed by the System.

(3) Administrative Expenses. At the discretion of the City Council, the administrative expenses of the System.

(b) General Obligation of the City. The obligation to pay benefits of LACERS shall be a general obligation of the City of Los Angeles.

Sec. 1162. Contribution of Members.

(a) Contribution Required. Each Member shall contribute to the System by salary deduction at the rate of contribution established by ordinance.

(b) Member Accounts. The Board of Administration shall maintain an individual account of the contributions made by or for each

Member. Regular interest shall be credited to the individual accounts as of the last day of each month equal to the yield of the five year Treasury Note as determined by the board.

(c) Payroll Deduction. Each Member shall be deemed to consent and agree to each deduction made as provided for in this section and the payment of each payroll check to a 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 the payroll, except any claims that the Member has to the benefits provided for in this Part 1.

(d) Refund of Contributions. The right of each and every Member to be paid his or her accumulated contributions in the event of any subsequent repeal of this Part 1 is hereby declared to be a vested property right of each Member. Furthermore, the right of each and every Member to be paid his or her accumulated contributions upon his or her separation from the City service and the right of each and every beneficiary to be paid the Member’s accumulated contributions upon the Member’s death before retirement or his or her unused contributions upon the Member’s death after retirement are hereby declared to be vested property rights of each Member or Beneficiary.

Sec. 1164. Employment by the City of a Retired Member of the System.

(a) Prohibition. No person who shall have been retired from the service and employment of the City pursuant to the provisions of this System shall thereafter be paid for any service rendered as an officer or employee of the City, except for service rendered as an election officer, as an officer elected by the electors of the City, or as a Retired Member of the Board of Administration.

(b) Exception for Temporary Service. The Mayor may, at the request of the appointing authority, authorize employment of a Retired Member to a vacant position in a class in which he or she has been employed or, subject to the civil service provisions of the Charter, in any other position, for a period not to exceed 120 days in any fiscal year when such Member's services are required for an emergency or to prevent a stoppage of public business or when his or her special skills are needed to perform work of a limited duration. While so employed, the Retired Member will continue to receive his or her retirement allowance as a Retired Member, but will make no further contribution to the System, and will not be subject to any change in benefits from the System as the result of the employment.

(c) Exception for Board Fees and Employment as Election Employee. Notwithstanding any other provision of this section, no Retired Member appointed to a board of commissioners established by the Charter or by ordinance, shall be barred by reason of retirement from receiving the attendance fee provided for the members of the board, nor shall any Retired Member be barred by reason of retirement from receiving compensation for serving not more than 120 days in any calendar year as a temporary election employee exempted from the classified civil service of the City pursuant to the provisions of Section 1001 of the Charter. No Retired Member receiving compensation described in this subsection shall be considered as an active member of this System for any purpose.

SECTION HISTORY

Amended by: Subsec. (b), Charter Amendment Q § 6, approved March 8, 2011, effective April 8, 2011.

Sec. 1166. Authority to Administer Other Retirement Plans.

(a) Council Authorization. The Council may by ordinance adopted in accordance with Section 1168 authorize the Board of

Administration to administer retirement plans for employees of the City who are not Members of the LACERS, or as a plan supplemental to any other pension or retirement plan established under the Charter or by ordinance. This plan or supplement shall be separate and distinct from LACERS and not subject to the definitions, conditions of entitlement or requirements applicable to LACERS.

(b) Fund. A separate fund administered by the Board of Administration of LACERS shall be created and established for the payment of administration expenses and benefits of any plan enacted under subsection (a). The source of funding for any such plan shall be determined by ordinance except that no assets of the LACERS Fund shall be available for such purpose. To the extent that the board is entrusted with investment responsibilities for such plans, the board shall be responsible for the investment of such funds in accordance with the standards that apply to the LACERS.

Sec. 1168. Establishment of Benefits by Ordinance.

(a) Procedure for Adoption of Benefits. Ordinances adopted pursuant to this section must be approved by not less than two-thirds of the Council, subject to the veto of the Mayor and override by Council by three-fourths 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.

(b) Limitation on Council Authority to Increase or Modify Benefits. The Council may, by an ordinance adopted pursuant to the

requirements contained in subsection (a) modify or add to the benefits set forth in the Administrative Code or change conditions of entitlement. However, the Council may not increase or modify benefits if doing so would violate limitations imposed by federal or state law. As a further condition to the final adoption of benefit modifications, it shall be required that the Council be advised in writing by an enrolled actuary as to the cost of benefit increases.

Any ordinance adopted pursuant to this section shall go into effect upon publication, but the Council may provide that the terms of the ordinance, or portions of it, shall be operative at a later date or dates. Ordinances adopted pursuant to this section shall be codified in the Los Angeles Administrative Code.

An allowance which becomes effective after the publication of an ordinance adopted pursuant to this section but prior to the operative date shall be modified or increased only from and after the operative date of the providing ordinance.

Sec. 1170. Benefits Not Assignable.

The right of every Member and of every Beneficiary to receive and be paid any money under any of the provisions of the LACERS is a right personal to the Member or Beneficiary which cannot be assigned to any other person, in any manner or for any purpose, the intent being that payments shall in all cases be made directly to the Member or Beneficiary.