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Sec. 1100. Applicability.
Sec. 1102. Pension and Retirement Departments and Plans.
Sec. 1104. Pension and Retirement System Boards.
Sec. 1106. Powers and Duties of Pension and Retirement Boards.
Sec. 1108. General Manager of Pension or Retirement Systems.
Sec. 1110. Control of Pension and Retirement Funds.
Sec. 1112. Management Audits.
Sec. 1114. Council Veto of Board Decisions.
Sec. 1116. Right to Retire While on Military Leave.
Sec. 1118. Gender and Number.
Sec. 1120. Purchases of Real Property.
PART 1 LOS ANGELES CITY EMPLOYEES' RETIREMENT SYSTEM
Sec. 1150. Los Angeles City Employees' Retirement System (LACERS).
Sec. 1152. Definitions.
Sec. 1154. Retirement Fund.
Sec. 1156. Transfer of Released Liability for Transferred Employees.
Sec. 1158. Actuarial Standards.
Sec. 1160. Budget.
Sec. 1162. Contribution of Members.
Sec. 1164. Employment by the City of a Retired Member of the System.
Sec 1166. Authority to Administer Other Retirement Plans.
Sec. 1168. Establishment of Benefits by Ordinance.
Sec. 1170. Benefits Not Assignable.
PART 2 WATER AND
POWER EMPLOYEES' RETIREMENT PLAN
Sec. 1180. Applicability of the Plan.
Sec. 1182. Definitions.
Sec. 1184. Retirement from Active Service.
Sec. 1186. Amendment of Plan and Provision of Health and Welfare Benefits.
Sec. 1188. Water and Power Employees' Retirement Fund.
Sec. 1190. Actuarial Survey.
ARTICLE XI
PENSION AND RETIREMENT SYSTEMS
GENERAL PROVISIONS FOR PENSION AND RETIREMENT SYSTEMS
Sec. 1100. Applicability. Each pension or retirement department or plan set forth in this Article shall be governed by the following:
(a) provisions specific to each department or plan set forth in this Article or
elsewhere in the Charter; and (b) these General Provisions for Pension and Retirement Systems.
Additionally, the General Provisions for Departments contained in Article IV shall
apply to the departments listed in Section 1102( a) to the extent not inconsistent with
this Article. Back
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Sec. 1102. Pension and Retirement Departments and Plans.
(a) Departments of the City. The following pension and retirement system departments, created in Section 400, are included within this Article:
Fire and Police Pension System Los Angeles City Employees' Retirement System (LACERS)
(b) Plan Created. The following retirement system is created within the Department of Water and Power and included within this Article:
Water and Power Employees' Retirement Plan (WPERP)
(c) Boards Created. Each of the pension and retirement system departments or plans set forth in subsections (a) and (b) shall be under the management and control of a board of commissioners. The boards shall have these names:
Board of Fire and Police Pension Commissioners Board of Administration of the Los Angeles City Employees' Retirement System Board of Administration of the Water and Power Employees' Retirement Plan Back to index
Sec. 1104. Pension and Retirement System Boards.
(a) Board of Fire and Police Pension Commissioners. The Board of Fire and Police Pension Commissioners shall consist of nine members. Five shall be appointed by the Mayor, subject to the approval of the City Council. One shall be an active sworn member of the Fire Department as defined in this Article and elected by the members of the Fire Department. One shall be an active sworn member of the Police Department as defined in this Article and elected by the members of the Police Department. One shall be a retired member of the Fire Department as defined in this Article and elected by the retired members of the Fire Department. One shall be a retired member of the Police Department as defined in this Article and elected by the retired members of the Police Department.
(b) Board of Administration for LACERS. The Board of Administration for LACERS shall consist of seven members. Four members, one of whom shall be a retired member of the system, shall be appointed by the Mayor subject to the approval of the Council. Two members shall be active employee members of the system elected by the active employee members. One shall be a retired member of the system elected by the retired members of the system.
(c) Board of Administration for WPERP. The Board of Administration for the WPERP shall consist of seven members. Three members shall be ex officio, three members shall be elected, and one member shall be appointed. The ex officio members shall be the General Manager of the Department, the Chief Accounting Employee of the Department, and one Board of Water and Power Commissioner selected by that board. Three elected members shall be active employee members of the system elected by the active employee members. One member shall be a retired member of the system appointed by the Board of Water and Power Commissioners.
(d) Terms of Board Members. For the Board of Fire and Police Pension Commissioners and the Board of Administration for LACERS, each elected board member shall serve for a term of five years. For the Board of Administration for WPERP, the appointed retired member and each elected board member shall serve for a term of three years. The terms of board members on all boards shall be staggered as determined by each board. In case of a vacancy of an appointed seat on any board, the appointing authority for the seat shall appoint a member to serve out the unexpired term of office. In case of a vacancy of an elected seat on any board that has more than six months remaining before expiration of the term, the applicable board shall conduct an election to select a member of the group represented by the vacant seat to serve out the unexpired term of office.
(e) Restrictions on Board Membership. No person who is employed in any capacity by the LACERS or by WPERP shall be eligible to file for election to or be appointed to the board of their respective systems. Back to index
Sec. 1106. Powers and Duties of Pension and Retirement Boards. Consistent with Article XVI, Section 17 of the California Constitution, and any successor constitutional provision, and subject to the limitations set forth elsewhere in the Charter concerning anything other than pension and retirement system administration and control over system investments, each pension and retirement board of the City shall:
(a) Administration of the Pension or Retirement System. Have sole and exclusive responsibility to administer its system for the following purposes:
(1) to provide benefits to system participants and their beneficiaries and to assure prompt delivery of those benefits and related services;
(2) to minimize City contributions; and
(3) to defray the reasonable expenses of administering the system.
The duty to system participants and their beneficiaries shall take precedence over any other duty.
(b) Assets. Have sole and exclusive fiduciary responsibility over the assets of its system which are held in trust for the exclusive purposes of:
(1) providing benefits to system participants and their beneficiaries; and
(2) defraying the reasonable expenses of administering the system.
(c) Prudent Person Standard. Discharge its duties with respect to its system with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with these matters would use in the conduct of an enterprise of a like character and with like aims.
(d) Investments. Diversify the investments of the system so as to minimize the risk of loss and to maximize the rate of return, unless under the circumstances it is clearly not prudent to do so.
(1 ) Investment Statement . The board of each pension and retirement system shall adopt a statement of investment objectives and policies for the system. The statement shall include at least the desired rate of return and acceptable levels of risk for each asset class, asset allocation goals, guidelines for the delegation of authority, and information of the types of reports to be used to evaluate investment performance. At least annually, the board shall review the statement and change or reaffirm it. After each annual review, the board shall forward the statement to the Mayor and Council for informational purposes.
(2) Performance Evaluation . At least annually, the board of each pension and retirement system shall retain an outside performance evaluation firm to calculate the returns on all of the system investments.
(e) Actuarial Services. Have the sole and exclusive power to provide for actuarial services in order to assure the competency of the assets of its systems in accordance with recognized actuarial methods.
(f) Rules and Regulations. Have the power to adopt any rules, regulations, or forms it deems necessary to carry out its administration of a pension or retirement system or assets under its control. Back to index
Sec. 1108. General Manager of Pension or Retirement Systems.
(a) Applicability. Except as provided in this section, the provisions regarding general managers contained in Article V shall apply to the general managers of the pension and retirement systems of the City.
(b) Appointing Authority. The Board of Fire and Police Pension Commissioners and the Board of Administration of the Los Angeles City Employees' Retirement System shall appoint the general manager subject to confirmation by the Mayor and Council and shall remove the general manager subject to confirmation by the Mayor. A general manager removed pursuant to the provisions of this section may appeal the removal to the Council in the manner provided in Section 408( d).
(c) Annual Review. The Board of Fire and Police Pension Commissioners and the Board of Administration for the Los Angeles City Employees' Retirement System shall evaluate their respective general manager at least annually and shall set or adjust the compensation of the general manager with guidelines established by Council. Each board shall forward a copy of its performance evaluation and salary determination to the Mayor and Council. Back to index
Sec. 1110. Control of Pension and Retirement Funds.
(a) Special Funds. Each pension and retirement board shall have a special trust fund or funds on deposit with the Treasurer for the purpose of segregating its revenues from the other money of the City.
(b) Control of Special Funds. The board of each pension and retirement system shall have control over their respective funds. Transfers or expenditures shall be drawn upon funds only upon demands signed by the chief accounting employee of the board. All payments from the funds shall be made upon demands prepared and approved in accordance with the provisions of the Charter.
(c) Master Trustee or Custodian. Each pension and retirement board, in its sole discretion, may designate one or more master trustees or custodians to hold securities and funds of the system for the purpose of carrying out the investment policies and decisions of the board.
(d) Fund Earnings. The money in any pension or retirement system fund shall be invested at the sole and exclusive direction of the respective board and all earnings shall be credited to the respective funds by the Treasurer or the Master Trustee or Custodian designated by the respective board. Back to index
(a) Conduct of Audit. The Mayor, Council, and Controller at least once in every five years, shall jointly require a management audit to be made of the business and property of each of the pension and retirement systems by an independent qualified management auditing firm. Each audit shall examine whether the pension or retirement system is operating in the most efficient and economical manner and shall evaluate the asset allocation of the system. The firm employed to conduct the audit shall be selected by the Mayor, Council and Controller.
(b) Audit Results. A copy of the report of each audit shall be transmitted to the Mayor, Council and the board of the audited pension or retirement system. Upon receipt of the audit, Council may request that some or all of the audit recommendations be implemented by a board, but the board shall retain sole and exclusive authority over administration of its system and assets to the extent provided in Article XVI, Section 17 of the California Constitution. Back to index
Sec. 1114. Council Veto of Board Decisions. The right of Council to veto board decisions provided in Section 236 shall not apply to decisions of the City' s pension and retirement boards. Back to index
Sec. 1116. Right to Retire While on Military Leave. Any officer or employee who, while on Military Leave as defined Section 1023 of the civil service provisions of the Charter, is or becomes entitled to retire on pension or is or becomes entitled to any benefits under any provision of this Article, may exercise such rights or claim such benefits while on Military Leave. Back to index
Sec. 1118. Gender and Number. As used in this Article, the masculine, feminine, or neuter gender, and the singular or plural number, shall each be deemed to include the others unless the context clearly indicates otherwise. Back to index
Sec. 1120. Purchases of Real Property.
(a) Real Estate Held in Board Name. Notwithstanding the provisions of Sections 105 and 385 of the Charter, title to any real property or interest in real property shall be held in the name of the applicable board and any real property or interests owned by a board may be sold, leased, or encumbered by the board.
(b) Board Names for Real Estate Purposes. The pension and retirement boards shall hold real property in the following names:
Board of Fire and Police Pension Commissioners of the City of Los Angeles
Board of Administration of the Los Angeles City Employees' Retirement System
Board of Administration of the Water and Power Employees' Retirement Plan of the City of Los Angeles
(c) Voting Procedure for Real Estate Investments. Any purchase of real property by a pension or retirement board shall require approval by a majority vote of all its members but one of the affirmative votes must be cast by an elected employee member of the board. Back to index
PART 1 LOS ANGELES CITY EMPLOYEES' RETIREMENT SYSTEM
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. Back to index
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). Back to index
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. Back to index
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. Back to index
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. Back to index
(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. Back to index
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. Back to index
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 90 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
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. Back to index
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. Back to index
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. Back to index
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. Back to index
PART 2 WATER AND POWER EMPLOYEES' RETIREMENT PLAN
Sec. 1180. Applicability of the Plan.
(a) Water and Power Department Employees and Beneficiaries. The Water and Power Employees' Retirement Plan (WPERP) created in Section 1102( b) of this Article shall be binding in its entirety upon all employees of the Water and Power Department and all beneficiaries of the Plan. All benefits under the retirement, disability and death benefit features of the Plan shall be granted only upon the terms and conditions set forth in the Plan.
(b) Intermittent, Occasional and Temporary Employees. Under no circumstances shall persons employed by the Department of Water and Power to render services of an intermittent or occasional character be eligible for the benefits of the Plan. Any employee, who shall have been excluded from participation in the benefits of the Plan on account of his or her temporary employment status, shall be permitted to participate in the benefits upon the terms and conditions provided by the Plan. Back to index
Sec. 1182. Definitions. For the purpose of this Part 2 concerning the Water and Power Employees' Retirement Plan, 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) Beneficiary : A person entitled to receive a benefit from the Plan.
(b) Member : An employee of the Department of Water and Power who meets the membership requirements of the Plan as further defined in Plan.
(c) Plan : The Water and Power Employees' Retirement Plan adopted by the Board of Administration pursuant to Section 1186.
(d) Retired Member : A member who has ceased employment with the Department of Water and Power and is receiving a regular monthly benefit payment from the Plan.
(e) System : The Water and Power Employees' Retirement Plan. Back to index
Sec. 1184. Retirement from Active Service.
(a) Normal Retirement. The normal retirement date for a Member shall be the first day of the calendar month which next follows the Member' s 60th birthday. A Member shall be retired from the service of the Department of Water and Power on the person' s normal retirement date or on the first day of any calendar month thereafter, upon his or her written application filed with the Board not less than 30 days prior to the date of retirement.
(b) Early Retirement. Any Member may be retired from the service of the Department of Water and Power prior to his or her normal retirement date upon his or her written application if the retirement is recommended by the general manager of the department and approved by the Board of Water and Power Commissioners in accordance with rules and regulations set forth in the Plan. Back to index
Sec. 1186. Amendment of Plan and Provision of Health and Welfare Benefits.
The provisions of the Plan may be amended from time to time to provide retirement, disability or death benefits upon the approval of the Board of Water and Power Commissioners and adoption by the Board of Administration. Prior to the adoption of any benefit change, a report from the Plan' s actuary must be presented to both the Board of Administration and the Board of Water and Power Commissioners analyzing the cost impact of the proposed changes upon the Plan. Back to index
Sec. 1188. Water and Power Employees' Retirement Fund.
(a) Creation of Fund. The Water and Power Employees Retirement Fund, the Water and Power Employees Disability Fund, and the Water and Power Employees Death Benefit Fund are created.
(b) Member Contributions. All contributions of employees and the Department of Water and Power under the Plan shall be paid into the Water and Power Employees Retirement Fund. The board, as authorized in Section 1110, may segregate revenues, contributions, and expenses of the various benefit programs of the Plan including Retirement, Disability, and Death Benefits.
(c) General Obligation. The obligation to pay benefits of WPERP shall be a general obligation of the Department of Water and Power and any of its successors. Back to index
Sec. 1190. Actuarial Survey. The Board of Administration of WPERP shall, at regular intervals not to exceed five years, secure a general survey and actuarial report of the Plan.Back to index
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