The City Council on Tuesday signed off on changes to City Manager Mark Scott’s contract after discovering — contrary to what officials thought when he was hired — that he doesn’t fall under the new employee pension system, and thus would cost the city more money than originally anticipated.
Scott gave up a number of benefits in his contract after realizing he qualifies for the old California Public Employees' Retirement System plan, which allows him to earn a larger pension upon retirement.
Under the new system, Scott’s annual pension would have capped at $155,000, meaning that his, along with the city’s, annual pension contribution would have cost roughly $10,500.
Before accepting the position, he was advised that he likely would have fallen under the new system since his former employer, the city of Fresno, has its own pension system.
But after taking the Burbank job, he discovered he qualified for the old plan, which meant the city would have had to pay an additional roughly $12,000 annually into his pension, paying the full employer pension contribution on his $290,000 salary, instead of on the $155,000 cap, he said.
“I went a back to the City Council, I said, ‘OK, look, we’ve got to change my contract,’” Scott said. “‘I need to take enough out of my contract to pay for that.’”
That meant cutting the relocation assistance clause through which he would have received $1,800 a month for up to 18 months, and the $8,000 raise that would have kicked in after the relocation assistance expired.
Additionally, the city will match voluntary contributions that Scott makes to his deferred compensation plan for up to $250 per month, instead of $1,250, and contribute $750 a month to his retiree medical account, according to the contract amendment.
“I just wanted to be fair,” Scott said.
The council approved the changes Tuesday in a 4-0 vote. Councilman Bob Frutos was absent.
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