HomeMy WebLinkAbout93-001 - ResolutionsRESOLUI~ONNO. 93-001
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO
~, CALIFORNIA, NOTINS ITS OPPOSITION TO THE
PROPOSAL BY THE COUNTY OF LOS ANG~.Rq, TO UTILIZE
COUNTY'S BUDGET
WHEREAS, it has been noted that the Los Angeles County Board of
Supervisors proposes to borrow assets of the County's 457 Deferred
~tionPlanto fund abudgetdeficit; and,
WHEREAS, Section 457 of the Internal Revenue Code allows any eligible
governmental agency, including cities, to create a 457 Deferred Compensation
Plan. Currently, a significant number of local gove~¥,~ts offer these plans
which are widely promotedas supplemental retirement for employees; and,
WHEREAS, participating employees in 457 plans consider these savings
to be an essential component of their retirement, and while the money remains
an asset of the gov~tal agency, participants have a degree of control
over the asset, including where the money is invested and the circumstances
under which it may be withdrawn; and,
WH~{EAS, the City of Rancho Cucamonga is aware of a recent proposal
by the Los Angeles County Board of Supervisors to borrow $250 million of the
County's 457 Deferred ~tion Plan funds to help meet an estimated budget
shortfall of approximately $600 million. The County ham indicated that the
funds would be borrowed only tem[~rarily, and that they would be repaid over a
period of six to seven years at an interest rate of approximately 6% to 6-1/2%
annually; and,
WHEREAS, the City of Rancho Cucamonga believes that once the
integrity of the 457 assets has been violated, the confidence of the employee
has been breached and opens the door for yet further ',borrowing" of these
NOW, THEREFORE, the City Council of the City of Rancho Cucamongadoes
hereby resolve that it is opposed to the County of Los Angeles making use of
457 funds to assist in balancing its budget, and that such assets should only
be used fort he purposes intended.
PASSED, APPROVED, and ADO~ this 6th day of January, 1993.
Alexander, Buquet, Gutierrez, Stout, Williams
NOES: None
ABSf~gT: None
Dennis L. Stout, Mayor
Resolution No. 93-001
Page2
a~J. ~ity Clerk
· . /~,~
I, D~RRA J. ADAMS, CITY CLFRK of the City of Rancho C~camonga,
California, do hereby certify that the foregoing Resolution was duly passed,
approved, and adopted by the City Council of the City of Rancho Cucamonga,
California, at a regular meeting of said City Council held on the 6th day of
Janllary, 1993.
Executed this
California.
7th day of January,
1993, at Rancho Cucamonga,
City Clerk