On June 28, 2010, the San Diego City Council introduced and adopted Ordinance No. O-19965 (Pension Reform, Financial Stabilization, and Sales Tax Ordinance) that established a ballot proposition linking the completion of certain reform measures to a sales tax increase. Proposition D requires satisfying 10 reform conditions related to certain pension, retiree health care, managed competition, and other financial reforms before imposing a temporary half cent sales tax increase.

Role of the City Auditor

The City Auditor is responsible for certifying that each reform measure has been completed and notifying the State Board of Equalization of the completion of all ten reform measures. Specifically, the independent City Auditor shall certify under this process:

1. The City Manager shall provide documentation to the independent City Auditor each time a reform measure has been satisfied.
2. The independent City Auditor shall review the documentation from the City Manager and any other information necessary to determine whether the reform measures have been met. Upon such determination, the independent City Auditor shall notify the City Manager within 10 business days of such determination. If the independent City Auditor determines that a reform measure has not been satisfied, he shall state the reason why the reform measure has not been met.
3. Within five calendar days of certifying that all reform measures have been satisfied, the independent City Auditor shall notify the State Board of Equalization to levy the sales tax.

Conditions

1. Ordinance to Eliminate Employee Retirement Offsets for Elected Officials and Unrepresented City Employees: An ordinance has been adopted to eliminate retirement offsets for elected officials and those City employees who are not represented by a labor organization. Retirement offsets means the amount of an individuals retirement system contribution which the City agrees to pay on behalf of the individual.
2. Complete Managed Competition Guide: The City has adopted a Managed Competition Guide, by ordinance, to allow the City to implement a managed competition process pursuant to San Diego Charter section 117(c) involving services such as, solid waste collection, print shop and publishing services, auto and fleet maintenance, landscaping and facilities operations and maintenance.
3. Complete DROP Cost Neutrality Study. The Mayor has completed a Deferred Retirement Option Plan (DROP) cost neutrality study, presented the findings to the City Council and, if said findings are that DROP is not cost neutral, the City will initiate meet and confer to make DROP cost neutral. Cost neutral means that the present value of the Citys share of costs for all compensation and benefit programs of the City of San Diego with DROP included is less than or equal to 102% of the present value of what those costs would be in the absence of DROP.
4. Solicit Request for Qualifications to Take Over Miramar Landfill Operations/Lease. The Mayor has solicited Requests for Qualifications from qualified bidders to assume the operations of the Miramar Landfill.
5. Eliminate Terminal Leave for all City Employees. The City has adopted an ordinance eliminating terminal leave for all City employees. Under the ordinance, upon separation from the City, an employee may only cash out accrued leave.
6. Reduce Retirement Offset for Represented City Employees. The City has reduced the total cost of Retirement Offsets existing as of June 30, 2010, for employees represented by labor organizations. Retirement offsets means the amount of an individuals retirement system contribution which the City agrees to pay on behalf of the individual.
7. Reduce Retiree Health Costs. The Citys future unfunded retiree health care liability existing on June 30, 2010, has been reduced. For purposes of this section, future unfunded retiree health care liability means the actuarial accrued liability based upon the retiree health care plan in effect on June 30, 2010.
8. Solicit Proposals to Take Over Information Technology Services. The Mayor has solicited proposals from qualified bidders to provide information technology services to the City which are provided by the San Diego Data Processing Corporation.
9. Establish Second Tier Pension Plan for Firefighters. The City has established a second tier pension plan for new employees represented by San Diego City Firefighters, International Association of Fire Fighters, Local 145 comparable to the terms of the plan currently in place for new employees represented by San Diego Police Officers Association as set forth at San Diego Municipal Code section 24.0403(i).
10. 10. Adopt Ordinance for Voluntary Defined Contribution Pension Plan. The City has adopted an ordinance creating an alternative Defined Contribution Plan intended to reduce City costs from the current City retirement plan. The ordinance would allow all City employees to voluntarily select or switch from a current City retirement plan to the alternative Defined Contribution Plan, which may be subject to IRS and other governmental agency approvals, but obtaining such approval is not part of this condition.