REQUEST FOR CITY COUNCIL ACTION
SUBMITTED TO: Honorable Mayor and City Council Members
SUBMITTED BY: Oliver Chi, City Manager
PREPARED BY: Dahle Bulosan, Chief Financial Officer
Subject:
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Adopt Resolution No. 2021-12 authorizing the refinance of the City's Unfunded Accrued Liability Account Balance through the Sale of Taxable Pension Obligation Bonds to Refund All or a Portion of the City's Obligation to the California Public Employees' Retirement System, and authorizing the Execution and Delivery of a Bond Purchase Contract and a Continuing Disclosure Certificate and the Preparation of an Official Statement and Other Matters Related Thereto; and, authorize and approve Certain Actions with Respect Thereto; and, Adopt Resolution No. 2021-19 Adopting the City's Unfunded Accrued Pension Liability Policy
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Statement of Issue:
City Council authorization is requested to approve the issuance and sale of Huntington Beach Taxable Pension Obligation Bonds to refund all or a portion of its California Public Employees' Retirement System (CalPERS) Unfunded Accrued Liability (UAL), and approve a formal policy relating to the management of future pension liabilities ("UAL Policy").
Financial Impact:
The issuance of pension obligation bonds for the refinancing of certain pension obligations of the City of Huntington Beach will likely reduce the annual costs related to the UAL that the City is currently obligated to pay CalPERS. As of June 30, 2019, the most current actuarial valuation available from CalPERS, the City's UAL for all citywide employees and retirees is approximately $436 million. Approximately 63% of the UAL is related to public safety (police and fire) employees, and 37% is related to non-safety employees.
Currently, total annual City UAL payments to CalPERS will range from $28.9 million for Fiscal Year (FY) 2019-20, increasing to approximately $45.5 million in the peak year of FY 2030-31. The scale of the UAL cost increase will impact the abilit...
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