Martinez City Employees Might Be On the Hook for Social Security Tax

Roughly three quarters of the city’s workforce is classified into a separate agency exempt from Social Security withholding and not as standard city employees.

The agency in question is the Pleasant Hill-Martinez Joint Facilities Agency (JFA), which was created in 1983 to manage and staff the two cities’ recreational facilities.

A recent report from the CalPERS Office of Audit Services accuses the JFA of not having truly existed for many years. Martinez disagrees saying it is still in force and currently headed up by the Martinez City Council which serves as the JFA’s Board.

The audit report drew attention to the sort of employees currently classified into the JFA. This includes an assistant city manager, the city's deputy public works director and city engineer, nonsworn Martinez Police Department employees, administrative assistants, corporation yard employees and managers among the 95 total.

Financially, reclassification would have massive implications on the city’s budget. The city’s Social Security employer contribution is estimated to be roughly $420,000, a hefty new line item for sure. There is still no word on whether Martinez will face making retroactive payments. The city got the report just prior to the beginning of contract talks with the three local unions who are also very concerned with this developing issue.

Moreover, Martinez City Councilman Mark Ross suggested that there may be other cities facing the same kind of misclassification issue, although the CalPERS spokesperson was mum on any details.

CityNews will continue to track this developing story out of Martinez.

For furthering reading on misclassification in Martinez, see here.

Image Credit: Flickr User sixxarp, via (CC BY-NC 2.0)