08 Staff Report - PARS to CalPERS Transfer
PREPARED BY: Stephen Conway
Finance Director
Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, and Finance Director
110 E. Main Street Los Gatos, CA 95030 ● (408) 354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 06/02/2020
ITEM NO: 8
DATE: May 28, 2020
TO: Mayor and Town Council
FROM: Laurel Prevetti, Town Manager
SUBJECT: Approve an Expenditure Budget Adjustment in the General Fund (Restricted
PARS Pension Trust Assets) in the Amount of $4,753,965 to Reflect the
Payment from the PARS Restricted Pension Trust Assets Reported in the
General Fund to CalPERS During FY 2019/20.
RECOMMENDATION:
Approve an expenditure budget adjustment in the General Fund (restricted PARS Pension Trust
assets) in the amount of $4,753,965 to reflect the payment from the PARS Restricted Pension
Trust assets reported in the General Fund to CalPERS during FY 2019/20.
BACKGROUND:
On September 3, 2019, the Town Pension and OPEB Trusts Oversight Committee directed staff
to utilize the funds in the PARS account to make payments directly to CalPERS toward existing
long-term amortization bases. The first additional discretionary payment (ADP) of $4,753,965
for the 2016 gain/loss amortization base was transferred directly to CalPERS from PARS on
October 11, 2019.
DISCUSSION:
For financial reporting purposes in the June 30, 2019 Comprehensive Annual Financial Report,
the Town changed its accounting for the PARS Pension Trust to classify it as a restricted cash
amount held in the General Fund in accordance with guidance from GASB 84. The FY 19/20
budget was prepared before the GASB 84 implementation was finalized resulting in no
corresponding budgeted line item for the General Fund in the adopted budget. This budget
adjustment establishes a line item appropriation for the current year (FY 19/20 closing as of
PAGE 2 OF 2
SUBJECT: Transfer from PARS to CalPERS
DATE: May 28, 2020
DISCUSSION (continued):
June 30, 2020) to match the amount that was paid from the PARS Trust on October 11, 2019
directly to CalPERS to pay off a pension liability amortization base as directed by Town Pension
and OPEB Trust Oversight Committee.
COORDINATION:
This staff report was coordinated with the Town Manager and Finance Department.
FISCAL IMPACT:
This action is an administrative “housekeeping” action for the FY 19/20 fiscal year close
providing an appropriated expenditure line item to match current year expenditures with
available funds in the PARS Pension Trust restricted asset account .
ENVIRONMENTAL ASSESSMENT:
This is not a project defined under CEQA, and no further action is required.