[HISTORY: Adopted by the Borough Council
of the Borough of Marcus Hook as indicated in article histories. Amendments
noted where applicable.]
[Adopted 2-1-1999 by Res. No. R-99-3,
approved 2-1-1999; amended in its entirety 12-3-2012 by Res. No. R-12-9, approved 12-3-2012]
[1]
Editor's Note: Former Art. I, Police Membership
in Pennsylvania Municipal Retirement System, adopted 6-2-1980 by Res.
No. R-80-10, approved 6-2-1980, was repealed 2-1-1999 by Res. No.
R-99-2, approved 2-1-1999.
Effective as of January 1, 2013, the accompanying
joinder agreement and the terms of the Pennsylvania State Association
of Boroughs Master Retirement Trust are hereby adopted by the employer,
to be known as the "Borough of Marcus Hook Police Pension Plan."[1]
[1]
Editor's Note: Said plan is on file in the
Borough offices and may be examined there during regular business
hours.
Said Plan shall be deemed to be a successor
to and a continuation of the prior plan.
[Added 1-6-2020 by Ord.
No. O-20-1, approved 1-6-2020]
This section establishes and implements an Act 44 Deferred Retirement
Option Program. A police officer who reaches normal retirement date
shall be eligible to participate under the Act 44 Deferred Retirement
Option Program ("DROP" or "Act 44 Program"), subject to the following
requirements.
A.
Title. This section shall be known as the "Marcus Hook Borough Act
44 Deferred Retirement Option Program."
B.
ACT 44 DEFERRED RETIREMENT OPTION PROGRAM
ACT 44 PROGRAM ACCOUNT
BOROUGH
DROP PERIOD
FUND or PLAN
PARTICIPANT
POLICE OFFICERS
Definitions. When used in this section, the below words shall have
the meanings indicated.
The Pension Payments Plan approved by the Pennsylvania Legislature
September 18, 2009, amending Title 53 as it relates to Municipal Police
Pension Plan.
Separate account created to accept Act 44 Program participants'
monthly pension check while an Act 44 Program participant, as well
as any interest thereon.
Borough of Marcus Hook, Delaware County, Pennsylvania.
"Act 44 DROP period" means the period beginning as of the
participating police officer's written election notice as acknowledged
by the employer and continuing until that police officer's separation
from employment as a police officer of the employer, but in no event
to exceed 60 months.
The Municipal Police Pension Plan.
A police officer who meets the eligibility for and has executed
the proper documents for participation in the Act 44 Program.
Police officers of the Police Department.
C.
Eligibility. Eligibility for the Act 44 Program shall be determined
as follows:
[Amended 2-1-2021 by Ord. No. O-21-1,[1] approved 2-1-2021]
(1)
Police officers who have not retired prior to the implementation
of the Act 44 Program may enter into the Act 44 Program on the first
day of any month coincident with, or following, satisfaction of the
age and service requirements: at least 53 years of age and have completed
25 years of service, as provided by the collective bargaining agreement.
[1]
Editor's Note: This ordinance shall be effective retroactively
to 1-1-2020.
D.
Written election. Eligible officers who wish to be participants in
the Act 44 Program must signify that intention in writing as follows:
(1)
A police officer electing to participate in the Act 44 Program must
complete and execute an "Act 44 Program Participation Election Form"
prepared by the Borough, which shall evidence the member's election
to participate in the Act 44 Program. The form must be signed by the
police officer and be notarized and submitted to the Borough Secretary.
The Act 44 Program Participation Election Form shall include an irrevocable
notice to the Borough, by the police officer member, that the police
officer shall resign from employment with the Police Department effective
on a specific date (the "resignation date") that is no later than
60 months from the effective date of Act 44 Program Election Form.
A police officer shall cease to work as and may no longer be employed
as a police officer on the officer's resignation date, unless the
Borough properly terminates or honorably discharges the officer prior
to the resignation date. A participant may resign from employment
while in Act 44 Program status, which shall terminate his/her participation
in the Act 44 Program.
(2)
In addition to the above information, the Act 44 Program Participation
Election Form shall also advise the employee of the following:
(a)
An explanation of the participant's rights and obligations while
in Act 44 Program, including the participation period of 60 months;
(b)
That, as a condition of Act 44 Program participation, the participant
foregoes active participation in the Police Pension Plan and foregoes
any recalculation of pension benefits to include salary increases
occurring after Act 44 Program participation commences; and
(c)
That the Act 44 Program participant's service while in Act 44
Program will not count as pension service nor will it entitle a participant
to any service increment benefits to which the participant was not
entitled prior to commencing Act 44 Program participation. Once an
Act 44 Program participant enters the Act 44 Program, the participant
may not subsequently leave and then re-enter the Act 44 Program, even
if the employee separates from employment and subsequently begins
employment with the Borough again.
E.
Benefit calculation. For all Pension Plan purposes, continuous service
of a police officer participating in the Act 44 Program shall remain
as it existed on the effective date of commencement of participation
in the Act 44 Program. Service thereafter shall not be recognized
or used for the calculation or determination of any benefits payable
by the Borough Police Pension Plan. The average monthly compensation
of the police officer for pension calculation purposes shall remain
as it existed on the effective date of commencement of participation
in the Act 44 Program. Earnings or increases in earnings thereafter
shall not be recognized or used for the calculation or determination
of any benefits payable by the Pension Program. The pension benefit
payable to the members shall increase only as a result of cost of
living adjustments in effect on the effective date of the member's
participation in the Act 44 Program or by applicable cost of living
adjustments granted thereafter.
F.
Accumulation of the Act 44 Program account. The monthly retirement
benefits that would have been payable had the police officer elected
to cease employment and receive a normal retirement benefit shall,
upon the police officer commencing participation in Act 44 Program,
accumulate to the benefit of that officer and be paid into that police
officer's Act 44 Program account. Participants shall not have the
option of self-directed investment of their individual Act 44 Program
account while in the Act 44 Program. Instead, the monies shall be
invested in a fund to be identified and selected by the Borough in
accordance with applicable law so as to generate a rate of return
of no less than 0% and no more than 4.5%.
G.
Accrual of non-pension benefits. After a police officer elects to
participate in the Act 44 Program, all other contractual benefits
shall continue to accrue with the exception of those provisions relating
to the Police Pension Plan.
H.
Payout. Upon separation from employment, the Act 44 Program payout
options available to the Act 44 Program participant shall be as follows:
(1)
The balance of the Act 44 Program participant's account, less withholding
taxes, if any, remitted to the Internal Revenue Service, shall be
paid to the participant or the participant's surviving beneficiary.
(2)
The balance of the Act 44 Program participant's account shall be
paid directly to the custodian of an eligible retirement plan as defined
by Internal Revenue Code Section 402(c)(8)(b), or in the case of an
eligible rollover distribution to the surviving spouse of a deceased
Act 44 Program participant, an eligible retirement Program that is
an individual retirement account or an individual retirement annuity
as defined by Internal Revenue Code Section 402(c)(9).
I.
Service-connected disability during Act 44 Program. If an eligible
DROP participant becomes temporarily incapacitated during his participation
in the Act 44 Program, the police officer shall continue to participate
in the Act 44 Program as if fully employed. The police officer shall
receive disability pay in the same amount as disabled police officers
that are not participating in Act 44 Program. In no event shall a
police officer on temporary disability have the ability to draw from
his Act 44 Program account. However, notwithstanding any other provision
in this subsection, if a police officer is disabled and has not returned
to work as of the date of his required resignation, then such resignation
shall take precedence over all other provisions herein and said officer
shall be required to resign. Nothing contained in this Program shall
be construed as conferring any legal rights upon any police officer
or other person to a continuation of employment nor shall participation
in the Act 44 Program supersede or limit in any way the right of the
Borough to lawfully discharge a police officer based upon their inability
to resume his or her full duties as a police officer. If an Act 44
Program participant becomes eligible for a service-connected disability
pension and his/her employment is terminated due to an inability to
continue in service on grounds that render him eligible for a service-connected
disability pension, the monthly normal retirement benefit of the Act
44 Program participant shall be reclassified as being on account of
a service-connected disability. In no event shall an Act 44 participant's
monthly retirement benefit be recalculated. The Act 44 participant's
monthly retirement benefit shall remain 50% as calculated at the time
of entry into the Act 44 Program.
J.
Death. If an Act 44 Program participant dies, the participant's eligibility
for the Act 44 Program shall terminate upon the date of death. In
such case, if the Act 44 Program account balances have not yet been
paid out, the participant's legal beneficiary shall have the same
rights and options as the participant to withdraw/roll over the account
balance.
K.
Forfeiture of benefits. Notwithstanding a police officer's status
as an Act 44 Program participant, a current or former participant
who is convicted or pleads guilty to engaging in criminal misconduct
which constitutes a "crime related to public office or public employment,"
as that phrase is defined in Pennsylvania's Pension Forfeiture Act,
43 P.S. §§ 1311 to 1314, shall forfeit his right to
receive a pension, including any amounts currently deposited in the
Act 44 Program account. In such a case, the participant shall only
be entitled to receive the contributions, if any, made by the participant
to the Police Pension Fund, without interest.
L.
Cost of management for Act 44 Program. Reasonable costs or fees associated
with the implementation or their individual management of the Act
44 Program account shall be paid directly and solely by the participant
and not by the Borough.
M.
Amendment. Any amendments to the Act 44 Program ordinance shall be
consistent with the provisions covering individual retirement option
plans set forth in any applicable collective bargaining agreement
and shall be binding upon all future Act 44 Program participants and
upon all Act 44 Program participants who have balances in their individual
retirement option accounts. The Act 44 Program may only be amended
by a written instrument, not by any oral agreement or past practice.
N.
Construal of provisions. A police officer's election to participate
in the Act 44 Program shall in no way be construed as a limitation
on the Borough's right to suspend or to terminate a police officer
for just cause or to grant the police officer an honorable discharge
based upon a physical or mental inability to perform his or her duties.
O.
Severability. The provisions of the Act 44 Program shall be severable,
and if any of its provisions shall be held to be unconstitutional
or illegal, the validity of any of the remaining provisions of the
Act 44 Program shall not be affected thereby. It is hereby expressly
declared as the intent of the Borough that the Act 44 Program would
have been adopted had such unconstitutional or illegal provision or
provisions not been included herein.
P.
Effective date. The effective date of the Act 44 Program will be
January 1, 2020.
[1]
Editor’s Note: This ordinance also repealed former Article
II, Pennsylvania Municipal Retirement System, adopted 2-4-2013 by
Ord. No. O-13-3, approved 2-4-2013.
Marcus Hook Borough (the Borough), having established a non-uniform
pension plan administered by the Pennsylvania Municipal Retirement
System (the System), hereby elects to amend its Non-Uniform Pension
Plan administered by the System in accordance with Article IV of the
Pennsylvania Municipal Retirement Law, 53 P.S. § 881.101
et seq. (Retirement Law), and does hereby agree to be bound by all
the requirements and provisions of the Retirement Law and the Municipal
Pension Plan Funding Standard and Recovery Act, 53 P.S. § 895.101
et seq., and to assume all obligations, financial and otherwise, placed
upon member municipalities.
As part of this article, the Borough agrees that the System
shall administer and provide the benefits set forth in the amended
Non-Uniform Pension Plan Document entered into between the Pennsylvania
Municipal Retirement Board and the Borough effective September 1,
2020 (the Contract).
The Borough acknowledges that, by the passage and adoption of
this article, the Borough officially accepts the Contract and the
financial obligations resulting from the administration of the Contract.
Payment for any obligation established by the adoption of this
article and the Contract shall be made by the Borough in accordance
with the Retirement Law and the Municipal Pension Plan Funding Standard
and Recovery Act.[1] The Borough hereby assumes all liability for any unfundedness
created due to the benefit structure set forth in the Contract.
[1]
Editor's Note: See 53 P.S. § 895.101 et seq.
The Borough intends this article to be the complete authorization
of the Contract, as amended, and it shall become effective and specifically
repeal Ordinance Number O-13-3 either immediately upon adoption of
this article or on September 1, 2020, which is the effective date
of the Contract, whichever is later.
A duly certified copy of this article and an executed Contract
shall be filed with the System.
