We’ve received a lot of questions regarding the impact of the Alameda Decision on pensions. We have an FAQ section below and we created a VCERA Alameda Decision Impact Retirement Survey. We need your input and ideas as our subcommittee meets to formulate a counter proposal to present to the Court.
If you are not a member and would like to strengthen our collective voice so we have more power to negotiate on our retirement and working conditions, click here to fill out a membership card and let’s stand together for secure retirement. Our voice is only as strong as our membership and solidarity.
FREQUENTLY ASKED QUESTIONS
1. What is the Alameda decision?
On July 30, 2020, the California Supreme Court ruled on a case of the Alameda County deputy sheriffs union against their retirement system. The case centered on whether the retirement system could legally apply provisions of the Public Employees’ Pension Reform Act (PEPRA, 2013). Specifically, determining what types of compensation are pensionable. The Court ruled that PEPRA is legal, and the retirement system did not have the discretion to include in-kind (not paid in cash) compensation for purposes of calculating a retirement benefit.
2. How does this affect the Ventura Superior Court?
Legacy members of VCERA have the employee-only flex credit amount included in the total compensation for retirement purposes. This is no longer permitted after the Alameda Decision since flex credit is considered in-kind compensation when used for medical benefits.
Simply, what VCERA considers compensation for retirement for Legacy members will decrease by $333 per pay period. VCERA has no option but to implement this change.
Old Method: Compensation = Salary + Employee-Only Flex Credit
New Method: Compensation = Salary + the flat or “employee-only” flexible credit allowance (FCA) minus the lesser of the opt-out fee (OOF) or the lowest-priced healthcare plan.
3. How do I know if I am a Legacy member?
Legacy members (also called Classic members) are those who became members of VCERA prior to January 1, 2013 or have reciprocity with a previous employer to maintain their Legacy status. If you are not sure, contact VCERA.
PEPRA members – those who joined VCERA after January 1, 2013 – are not affected by the VCERA changes.
4. When does this change happen?
We expect VCERA to adopt a resolution implementing the change in April.
5. How is the retirement benefit for Legacy members going to be affected?
It will vary widely depending on individual circumstances from less than $100 per month to several hundred dollars per month less than if the full Flex Credit remained pensionable. Based on one estimate, the average retiree will see a loss of $187 per month.
6. I’m eligible for retirement, should I retire now to lock in a higher compensation amount?
Retiring now will not eliminate the impact. VCERA will retroactively recalculate all earned compensation from July 30, 2020 forward.
7. What about the employee contributions Legacy members made to VCERA since the decision?
VCERA will be calculating excess contributions made from July 30, 2020 to when the change is implemented. The timing and method of returning those contributions are still being determined and we will communicate additional information in the future.
8. If this is mandated by law, what is the subcommittee bargaining over?
The Union has a right to negotiate over impacts from the change. The Court should help soften the blow of the reduced retirement benefit and the subcommittee will negotiate over possible mitigations.
9. What if I have more questions?
Contact your Regional Coordinator Edwin Valdez at edwin.valdez@seiu721.org.