Staff Report 5.1

Meeting Date:December 4, 2019
Agenda No.:Item 5.1
Agenda Item Title:

LAFCO Staffing and Facilities: Amended Memorandum of Understanding for Fiscal Year 2019-2024

Proposal:

Staff is requesting Commission approval of a Memorandum of Understanding with the County Administrator’s Office for Fiscal Years 2019-2024

Environmental Determination:

Not a project under CEQA

Staff Contacts:Mark Bramfitt

Analysis

Background

At the April 3, 2019, meeting, the Commission approved a Memorandum of Understanding (MOU) with the County Administrator’s Office for professional and support staffing, office space, equipment and supplies. 

The MOU featured amended language describing the selection process for the Executive Officer, a key interest of the Commission, and was drafted to cover a five-year period – 2019-2024 – instead of the historically one-year agreements in place since 2001. 

At its meeting on November 19, 2019, the Sonoma County Board of Supervisors approved the MOU, incorporating changes that had been discussed with staff and relating to unfunded liability. In that the Commission had not approved the MOU with the additional language, staff is providing the revised document for Commission consideration. 

Change from April 3, 2019, Adopted MOU: Unfunded Liability Costs

As part of its review of the Fiscal Year 2019-20 budget, the Sonoma County Board of Supervisors adopted a new financial policy related to cost recovery. Under that policy, the County expects full cost recovery for any portion of services provided by the County, including recovery of full future retirement costs of County employees who act as employees for outside entities. 

In that Commission staff are County employees, the Commission is expected to be responsible for covering 100 percent of current and future staffing costs – “unfunded liability” - for all employees under its purview during the contract duration.

As the Commission is aware, LAFCO staff positions are “housed” in the County Administrator’s Office job allocation and budget. Each quarter staff initiates a transfer of the actual cost of staff salaries and benefits (as well as Commissioner stipends) from the CAO expenditure budget to the LAFCO budget, where Commission-approved funds are available. Unfunded Actuarially Accrued Liability (UAAL) costs are included as charges in the LAFCO budget for each employee. 

Calculation of Unfunded Liability Costs and Amount

Through its annual budget process, the Board of Supervisors approves supplemental unfunded liability pre-payments. For LAFCO, these are calculated based on LAFCO’s percentage of countywide pensionable payroll against the supplemental pre-payment amount not already included in salaries/benefits calculations. The County has determined that for Fiscal Year 2020-21, when supplemental unfunded liability payments from LAFCO will be initially assessed, the amount will be $7,935. Staff intends to include this amount in the upcoming year’s budget proposal, as a line item; this will continue each year. When any staff member leaves LAFCO employment, the County will assess any additional unfunded liability. 

Language memorializing the Commission’s responsibility has been added to the MOU, in section 1(a), which is attached for Commissioners’ information.

Recommendation

Staff recommends that the Commission approve the revised Memorandum of Understanding with the County Administrator’s Office, as proposed, and authorize the Executive Officer to execute the agreement. Staff has prepared a draft resolution for Commission consideration.

Attachments

  1. Draft Memorandum of Understanding
  2. Draft Resolution

 

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