Laserfiche WebLink
City Council Agenda Report <br />Pension Trust and Reserve Analysis and Use Policy <br />March 18, 2025 Page 4 <br /> • General Fund surpluses may be deposited into the Trust. <br />• Continue pre-paying pension liabilities when feasible to achieve cost savings. <br />• Take steps to ensure that the Pension Resources last until at least FY 2034, when pension <br />costs are projected to decline. <br /> <br />The City has taken proactive steps to manage rising pension costs through the strategic use of the <br />Section 115 Pension Trust, the Pension Reserve, and other cost management strategies. With the <br />Pension Resources totaling $30.6 million and future pension costs continuing to pose a financial <br />challenge, it is essential to implement a clear, sustainable approach for utilizing these funds. <br /> <br />Based on the analysis conducted by NHA Advisors, the City has developed a Pension Trust and <br />Reserve Policy to guide the responsible use of the Pension Resources. This policy would ensure <br />that funds are used judiciously to mitigate budget impacts while maintaining long-term financial <br />stability. By adhering to these guiding principles, the City could effectively navigate pension <br />cost volatility, preserve essential services, and position itself for greater fiscal resilience as <br />pension costs begin to decline in 2034. <br /> <br />Finance Committee <br />On February 27, 2025, staff and NHA Advisors presented information on the Pension Resources <br />and proposed the Pension Trust and Reserve Use Policy to the Finance Committee. The <br />Committee has referred the policy to the City Council for acceptance and adoption, and <br />requested that staff and Council periodically review the policy in conjunction with the budget <br />development cycles. This review would allow adjustments to be made to meet changing <br />economic conditions and ensure that the policy continues to meet the objectives and guidance <br />outlined in the policy. <br /> <br />FINANCIAL IMPACTS: <br />None. <br /> <br />ALTERNATIVE ACTION: <br />City Council could choose not to adopt the proposed Pension Trust and Reserve Use Policy. <br /> <br />DOCUMENTS: <br />Attachment 1: Draft Resolution with Exhibit A, Pension Trust and Reserve Use Policy <br />Attachment 2: Financial Forecast Scenarios presented to City Council January 21, 2025 <br /> <br />CITY COUNCIL ACTION RECOMMENDED: <br />Move to accept the report and adopt the resolution establishing the Pension Trust and Reserve <br />Use Policy, as recommended by the Finance Committee. <br /> <br /> <br />STAFF CONTACT: Kirsten LaCasse, Administrative Services Director <br /> (925) 943-5810 <br /> lacasse@wanutcreekca.gov <br /> <br />Docusign Envelope ID: BB80A86F-2853-4F40-B02D-18F5B9DD615F