santa barbara community college district...fiscal impact assumes 100% adjunct replacement for year...

Santa Barbara community college District ▎ 1

Santa barbara Community College DistrictPARS Supplementary Retirement Plan (SRP) – Board of Trustees Meeting

October 15, 2019

SRP Supplementary Retirement Plan


• Established in 1984

• 3rd Largest Multiple Employer Public Retirement System in

California

• 1,000+ Member Agencies

• Over 375,000 SRP Participants

• 1,600+ Retirement Plans

• Headquartered in Orange County

• Assists in all phases of the program from plan design, analysis,

communication, implementation and ongoing plan

administration

About PARS (Public Agency Retirement Services)


PARS CCD Clients U p d a t e d : O c t o b e r 2 0 1 9

Allan Hancock CCD

Alvin CCD, TX

Cerritos CCD

Chabot-Las Positas CCD

Clarendon College, TX

Coast CCD

Compton CCD

Contra Costa CCD

Desert CCD

Foothill-De Anza CCD

Glendale CCD

Grossmont-Cuyamaca CCD

Hartnell CCD

Hill Junior College, TX

Imperial CCD

Lassen CCD

Lone Star College System, TX

Long Beach CCD

Los Angeles CCD

Los Rios CCD

Marin CCD

MiraCosta CCD

Mt San Antonio College

Napa Valley CCD

North Central Texas CCD, TX

North Orange County CCD

Palomar CCD

Palo Verde CCD

Pasadena City College

Quincy College, MA

Rancho Santiago CCD

Rio Hondo CCD

Riverside CCD

San Bernardino CCD

San Joaquin Delta CCD

San Luis Obispo County (Cuesta) CCD

Santa Clarita CCD

Santa Monica CCD

Solano CCD

South Orange County CCD

Southwestern CCD

State Center CCD

Victor Valley CCD

Victoria College, TX

West Valley-Mission CCD

Yosemite CCD


• Board approves a contingent plan offering to designated eligible

employees during two enrollment windows

• Interested employees submit irrevocable letters of resignation

during the enrollment periods.

• At the end of the enrollment periods, a fiscal analysis is

conducted to determine the savings (or cost) to District

• Based on results, Board determines if Plan proceeds or is

cancelled

• If Plan proceeds, employees resign

• If Plan is canceled, the offer and resignation letters are

rescinded

SRP Process and Steps


Proposed Timeline

October 25, 2019 ·PARS mails individual benefit illustration packets to

Window #1 eligible employees (excluding Faculty)

Early November 2019 · PARS holds orientation meetings

Early December 2019 · PARS holds one-on-one employee workshop

December 4, 2019 · Enrollment Window #1 closes

December 31, 2019 · Window #1 employees resign from District employment

February 1, 2020 · PARS benefit checks commence for Window #1 retirees

Mid-February 2020 ·PARS mails individual benefit illustration packets to

Window #2 eligible employees (including Faculty)

Mid-March 2020 · PARS holds orientation meetings

Late April 2020 · PARS holds one-on-one employee workshop

May 1, 2019 · Enrollment Window #2 closes

June 30, 2020 · Window #2 employees resign from District employment

August 1, 2020 · PARS Benefit Checks commence for Window #2 retirees


Proposed Plan Design

Spend Amount

70% of Final Pay

• Post-Employment contributions funded over a period of five (5) years

following termination of employment

• District Contributions are used to fund the purchase of an annuity

through Pacific Life Insurance Co.

• Distribution options receive favorable tax treatment and may be

eligible for IRA rollovers

Plan offered through a tax-sheltered annuity program:Internal Revenue Code Section 403(b)


PARS Analysis Methodology

Total Compensation Differential between Retiring Employee and Replacement Employee

Future Loss in Natural Attrition-

Savings due to Non-Replacements+

Net Savings (Cost)=

Current Natural Attrition-

Retirement Health Care Cost-

Retirement Incentive Cost-


Plan Assumptions (academic)Full-Time Faculty Educational Administrators

Eligibility RequirementsAge 55, 5 Years of ServiceAge 50, 30 Years of Service

Benefit Level 70% of Final Pay

Resignation from District employment

June 30, 2020 December 31, 2019 or June 30, 2020

Replacement SalariesFull-Time Faculty: $85,837 (Based on PARS 3-Year New Hire Study)

90.60% of Current Salary (Step 5)

Adjunct Faculty

Adjunct Hourly Rate: $95.90 (Step 5 Credit Adjunct Rate)Total Adjunct Hours: 525Total Adjunct Faculty Salary: $50,348Adjunct Faculty Health Care Cost: $3,607 (40% of Active Employee Cost)

Health Care Costs

Active: $9,018Pre-65 Retiree: $5,256Post-65 Retiree: $0Health Care COLA: 0.00%

ParticipationEducational Administrators - Assumes that 50% of eligible employees will retire in December and 50% of eligible employees will retire in June.

PARS Plan Funding 5-Year Annuity purchased through Pacific Life Insurance


Plan Assumptions (classified)Classified Non-Management Classified Management & Confidential

Eligibility Requirements Age 50, 5 Years of Service

Benefit Level 70% of Final Pay

Resignation from District employment

December 31, 2019 or June 30, 2020

Replacement Salaries 86.20% of Current Salary (Step 3) 90.60% of Current Salary (Step 5)

Health Care Costs

Active: $9,018Pre-65 Retiree: $6,331Post-65 Retiree: $0Health Care COLA: 0.00%

Participation

Classified Non-Management - Assumes that 40% of eligible employees will retire in December and 60% of eligible employees will retire in June.

Classified Management & Confidential - Assumes that 33% of eligible employees will retire in December and 67% of eligible employees will retire in June.

PARS Plan Funding 5-Year Annuity purchased through Pacific Life Insurance


Full-time faculty


Fiscal Summary of Savings

FISCAL IMPACT ASSUMES 100% ADJUNCT REPLACEMENT FOR YEAR 1

Replacement Scenario# of

Positions Replaced

Projected Savings in Mid-Year

2019-20

Projected Savings in Year 12020-21

Projected Savings over 3 Years

2022-23


2024-25

100% Replacement 0.00 $0 $1,007,683 $817,391 $497,825

90% Replacement 2.10 $0 $1,027,982 $1,101,195 $1,067,089

80% Replacement 4.20 $0 $1,048,280 $1,385,000 $1,636,352

70% Replacement 6.30 $0 $1,068,578 $1,668,804 $2,205,616

60% Replacement 8.40 $0 $1,088,877 $1,952,608 $2,774,879

50% Replacement 10.50 $0 $1,109,175 $2,236,413 $3,344,143

FULL-TIME FACULTY


Plan EligibilityFULL-TIME FACULTY

6

3

6 6

7

8

6

1

9

8

6

5 5

1 1 1

5

1 1 1

0

1

2

3

4

5

6

7

8

9

10

50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79+

# o

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s

Age

87Eligible Employees

Avg Age: 63.1


Plan EligibilityFULL-TIME FACULTY

0

5

10

15

20

25

30

35

40

45

50

50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85

Ye

ars

of

Se

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e

Age


PARS Retirement Projections

# of Eligible Employees

Projected Retirements in December 2019

Projected Retirements in

June 2020

Total Projected Retirements

with PARS SRP

Percentage Retirements

87 0 21 21 24.14%

FULL-TIME FACULTY


CLASSIFIED NON-MANAGEMENT




Positions Replaced


2019-20



2022-23


2024-25

100% Replacement 0.00 ($37,355) ($92,808) ($288,006) ($531,229)

90% Replacement 1.90 ($5,265) $49,305 $94,398 $119,243

80% Replacement 3.80 $26,826 $191,418 $476,801 $769,715

70% Replacement 5.70 $58,916 $333,531 $859,205 $1,420,187

60% Replacement 7.60 $91,007 $475,644 $1,241,609 $2,070,658

50% Replacement 9.50 $123,097 $617,757 $1,624,013 $2,721,130



Plan EligibilityCLASSIFIED NON-MANAGEMENT

10

4

8

7

5

7

3

9

5 5

2

6 6

11

4

2

4

2 2

3

2

3

2

0

2

4

6

8

10

12

50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79

# o

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loy

ee

s

Age


Avg Age: 59.3


Plan EligibilityCLASSIFIED NON-MANAGEMENT

0

5

10

15

20

25

30

35

40

50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85

Ye

ars

of

Se

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e

Age






June 2020


with PARS SRP


112 8 11 19 16.96%



EDUCATIONAL ADMINISTRATORS




Positions Replaced


2019-20



2022-23


2024-25

100% Replacement 0.00 ($11,269) ($21,625) ($67,154) ($126,735)

50% Replacement 1.00 $23,871 $160,339 $430,848 $721,418

0% Replacement 2.00 $59,011 $342,304 $928,851 $1,569,571



Plan EligibilityEDUCATIONAL ADMINISTRATORS

1 1 1 1 1 1

0

1

2

3

4

5

50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79

# o

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Age

6Eligible Employees

Avg Age: 61.00


Plan EligibilityEDUCATIONAL ADMINISTRATORS

0

5

10

15

20

25

50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85

Ye

ars

of

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Age






June 2020


with PARS SRP


6 1 1 2 33.33%



CLASSIFIED MANAGEMENT & cONFIDENTIAL




Positions Replaced


2019-20



2022-23


2024-25

100% Replacement 0.00 ($9,309) ($32,311) ($99,116) ($179,412)

67% Replacement 1.00 $11,475 $76,259 $201,851 $336,382

33% Replacement 2.00 $32,258 $184,829 $502,819 $852,175

0% Replacement 3.00 $53,041 $293,399 $803,786 $1,367,968

CLASSIFIED MANAGEMENT & CONFIDENTIAL


Plan EligibilityCLASSIFIED MANAGEMENT & CONFIDENTIAL

2

1 1

3

1

2 2

1 1 1

0

1

2

3

4

5

50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79

# o

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ee

s

Age


Avg Age: 60.13


Plan EligibilityCLASSIFIED MANAGEMENT & CONFIDENTIAL

0

5

10

15

20

25

30

35

50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85

Ye

ars

of

Se

rvic

e

Age






June 2020


with PARS SRP


15 1 2 3 20.00%

CLASSIFIED MANAGEMENT & CONFIDENTIAL


• Customized Enrollment Packet:

— Individualized benefit illustration mailed to home at start of window.

• Group Orientation Meeting:

— Held at District location to ensure maximium employee attendance

• Toll-free Enrollment Line:

— Call-in center available for calls throughout the window and throughout retirement.

• One on One Employee Workshop:

— Held at District location to help employees complete paperwork and answer last minute questions

Communication Process with Employee


Contacts

Maureen toalSenior Vice President

[email protected]

(800) 540-6369 ext. 135

santa barbara community college district...fiscal impact assumes 100% adjunct replacement for year...

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