NEWS RELEASE

City of San Gabriel 425 South Mission Drive San Gabriel, CA 91776 www.sangabrielcity.com

Contact: Steven A. Preston, City Manager Administration Department 626.308.2805 spreston@sgch.org

FOR IMMEDIATE RELEASE March 8, 2012

City Responds to Lawsuit by San Gabriel Police Officers Association

This afternoon the San Gabriel Police Officers Association filed a lawsuit against the City of San Gabriel, members of the Council and City staff, alleging that the City has misappropriated funds from the Citys retirement fund. This lawsuit comes less than 48 hours after the City declared it had reached an impasse in negotiations with three of the Citys four recognized bargaining units over the Citys request that all employees begin to make their own contributions to their pension plan. The City is deeply disappointed that the Police Officers Association has used litigation as a vehicle to secure its demands, and doubly saddened that the Association would use unfounded and inflammatory claims to support them. We believe the City has acted ethically, legally, responsibly, and in the best interests of its residents and its taxpayers. We will continue to do so. The Police Officers Association has called a news conference tomorrow. We would like the public, the taxpayers, and the media to know that: As a city and a government, we remain committed to openness and transparency. Should the Association announce its intention to serve the Council or the Administration staff, we will gladly receive them in the Citys administrative offices. While we will be pleased to respond to the Association at the appropriate time, we believe that the taxpayers will be served best when the City takes the time to review the allegations and respond with clear and factual information. We will review each and every claim made, and will respond with full and complete information wherever possible.

What Are the Issues at Stake? San Gabriels employees benefit from participation in CalPERS, the States retirement plan for state and local government employees. That retirement plan is comprised of two components: an

employers share, typically paid by the employer, and an employees share, typically paid by the employee. Over the past two decades, many California cities including San Gabriel had paid both the employee and the employer share. Like many cities throughout California, the City Council has concluded that this practice is no longer sustainable, and has requested that the Citys employee groups pay their fair share of the employee retirement contribution, for a plan that continues to provide a level of benefits that exceeds most plans found in private industry. The Police Officers Association has rejected this request. Has the City Mismanaged the Citys Retirement Fund? No. The City has managed its retirement funds prudently and appropriately. We have taken pride in providing our public safety employees a superior package of benefits consistent with industry standards. We have done nothing wrong, and will provide information at the appropriate time to demonstrate that fact. Beyond that, the City will be reviewing the allegations made in the lawsuit and will respond after it has had its legal advisors review them. That process has just begun, and is expected to occur over the next 30 days. The SGPOA contends they are among the lowest paid employees in the area. Is this true? The City surveys salaries of all employees on an annual basis, and has shared that data with the Association. At an individual median income of $97,961 annually, the average San Gabriel police officer makes over $41,000 more than the average household in our city, based on the Census reported household median income of $56,720 annually. These figures do not include a generous benefit and retirement package that adds substantially to their compensation. Our data shows that while police employees have slightly lower salaries than the median among survey cities, the combination of benefits and retirement place them well within the local market for total compensation. Whats Next? The City is reviewing the lawsuit, and will be preparing a formal response to the allegations made in that document. Beyond that, the City has no further comment at this time. # # #