Township of East Hempfield, PA
Lancaster County
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Table of Contents
Table of Contents
[HISTORY: Adopted by the Board of Supervisors of the Township of East Hempfield as indicated in article histories. Amendments noted where applicable.]
GENERAL REFERENCES
Pensions — See Ch. 37.
016 Schedule A
[Adopted 6-15-2011 by Ord. No. 2011-11]

§ 16-1 Definitions.

For the purpose of this article, the following terms shall have the respective meanings set forth below unless otherwise expressly provided:
ACCOUNT
The investment recordkeeping account established to fund the anticipated premiums for health insurance coverage for current and retired police officers meeting the definition of "retiree" as defined below.
ADMINISTRATOR
The Township may contract for such administrative services as are necessary to implement this article.
AGREEMENT
The bargaining agreement between the Association and the Township, most recently approved on or about November 3, 2010, effective January 1, 2011.
ASSOCIATION
The collective bargaining unit comprising the police officers of East Hempfield Township.
CODE
The Internal Revenue Code of 1986, as amended from time to time.
INVESTMENT FUND
Any separate investment option vehicle selected by the Township in which all or a portion of the Trust assets may be invested as hereinafter provided. The Trustee shall not be required to select any investment fund.
RETIREE
A current or retired police officer who was hired before January 1, 2011, and who thereafter retired or will retire after the date of this article.
TRUST
The trust established by this article.
TRUSTEE
The group of Trustees, appointed as hereinafter set forth, acting collectively.

§ 16-2 Trust established.

A. 
The Trust is hereby established as of the date set forth above for the exclusive purpose of providing a funding mechanism for anticipated premiums for health insurance coverage for current and retired police officers who were hired before January 1, 2011.
B. 
On or about the date hereof, the Township will transfer to the Trust the assets listed on Schedule A,[1] which shall include all the assets heretofore set aside for the purpose of paying premiums on medical and health insurance policies for retired police officers.
[1]
Editor's Note: Schedule A is included at the end of this chapter.
C. 
The Township is expected to continue to make additional contributions based upon the Township's projections for future liability for police health insurance coverage and subject to available funding.

§ 16-3 Legislative governance; word usage; severability and construal of provisions.

A. 
This article and its validity, construction and effect shall be governed by the laws of the Commonwealth of Pennsylvania.
B. 
Pronouns and other similar words used herein in the masculine gender shall be read as the feminine gender, where appropriate, and the singular form of words shall be read as the plural, where appropriate.
C. 
If any provision of this article shall be held illegal or invalid for any reason, such determination shall not affect the remaining provisions, and such provisions shall be construed to effectuate the purpose of this Trust.

§ 16-4 Board of Trustees established.

A. 
The Township shall appoint a Board of Trustees, from time to time, as follows:
(1) 
The Township shall appoint five Trustees, two of whom may be members of the Board of Supervisors, two of whom may be staff employees of the Township, and at least one of whom shall be a citizen of the Township who is neither a member of the Board of Supervisors nor a staff employee of the Township.
(2) 
To ensure both continuity and a method for replacing individual Trustees from time to time, each Trustee so appointed shall remain in office as a Trustee until the earlier occurs:
(a) 
His or her replacement;
(b) 
His or her resignation; or
(c) 
His or her death.
B. 
Any decision to be made by the Board of Trustees or action taken by the Board of Trustees may be made by a majority of the then-existing Board of Trustees acting with or without a meeting.
C. 
Except as described in this article, the Board of Trustees may adopt its own rules, regulations and procedures for fulfilling the Board of Trustee's duties.
D. 
Upon the resignation, removal, death or incapacity of any Trustee, the remaining members of the Board of Trustees may release the former Trustee and such Trustee's estate. Any such release shall be binding on all present and future parties in interest without the necessity of a court accounting.
E. 
If a vacancy in the Board of Trustees occurs which is not filled within 30 days by the party or parties responsible, the existing Board of Trustees may, by a majority vote, with or without a meeting, appoint a successor to fill the vacancy, and if the existing members of the Board of Trustees fail to name a successor to fill the vacancy within 30 days after the end of the thirty-day period described above, any one or more of the Township, the Association or the existing Board of Trustees may request the President Judge of the Court of Common Pleas of Lancaster County to appoint a person to fill such vacancy.

§ 16-5 Duties of Trustee.

A. 
It shall be the duty of the Trustee to hold title to trust assets in the Trustee's name, as directed by the Township or its designees in writing. The Trustee shall not be under any duty to compute the amount of contributions to be made by the Township or to take any steps to collect such amounts as may be due to be held in Trust under the terms of this article. The Trustee shall not be responsible for the custody, investment, safekeeping or disposition of any assets comprising the Trust, to the extent that such functions are performed by the Township or the Administrator, or both.
B. 
It shall be the duty of the Township to keep accurate books and records, or cause its designee to keep accurate books and records, with respect to the account.

§ 16-6 Investments.

A. 
The Township may appoint one or more investment managers to manage and control all or part of the assets of the Trust, and the Township shall notify the Trustee, in writing, of any such appointment.
B. 
The Trustee shall not have any discretion or authority with regard to the investment of the Trust and shall act solely as directed trustee of the assets of which it holds title. To the extent directed by the Township, the Trustee is authorized and empowered with the following powers, rights and duties, each of which the Trustee shall exercise in a nondiscretionary manner:
(1) 
To cause stocks, bonds, securities or other investments to be registered in its name as Trustee, or in the name of a nominee, or to take and keep the same unregistered.
(2) 
To employ such agents and legal counsel as it deems advisable or proper in connection with its duties and to pay such agents and legal counsel a reasonable fee. The Trustee shall not be liable for the acts of such agents and counsel or for the acts done in good faith and in reliance upon the advice of such agents and legal counsel, provided it has used reasonable care in selecting such agents and legal counsel.
(3) 
At the direction of the Township or the investment manager, as the case may be, to sell, write options on, convey or transfer, invest and reinvest any part thereof in each and every kind of property, whether real, personal or mixed, tangible or intangible, whether income or non-income-producing and wherever situated, including, but not limited to, time deposits, shares of common and preferred stock, mortgages, bonds, leases, notes, debentures, equipment or collateral trust certificates, rights, warranties, convertible or exchangeable securities and other corporate, individual or government securities or obligations, annuity, retirement or other insurance contracts, mutual funds, or in units of any other common, collective or commingled trust fund.
C. 
Notwithstanding anything to the contrary herein, the assets of the account shall be held by the Trustee as title holder only. Persons holding custody or possession of assets titled to the Trust shall include the Township, the Administrator, the investment manager and any agents and subagents, but not the Trustee. The Trustee shall not be responsible or liable for any loss or expense which may arise from or result from compliance with any direction from the Township, Administrator, the investment manager or such agents to take title to any assets nor shall the Trustee be responsible or liable for any loss or expense which may result from the Trustee's refusal or failure to comply with any direction to hold title, except if the same shall involve or result from the Trustee's negligence or intentional misconduct. The Trustee may refuse to comply with any direction from the Township, the Administrator, the investment manager or such agents in the event that the Trustee, in its sole and absolute discretion, deems such direction illegal.
D. 
The Township hereby indemnifies and holds the Trustee harmless from any and all actions, claims, demands, liabilities, loans, damages or reasonable expenses of whatsoever kind and nature in connection with or arising out of any action taken or omitted in good faith by the Trustee in accordance with the directions of the Township or its agents and subagents hereunder or any disbursements of any part of the Trust made by the Trustee in accordance with the directions of the Township or any action taken by or omitted in good faith by the Trustee with respect to an investment managed by an investment manager in accordance with any direction of the investment manager or any inaction with respect to any such investment in the absence of directions from the investment manager. Notwithstanding anything to the contrary herein, the Township shall have no responsibility to the Trustee under the foregoing indemnification if the Trustee fails negligently, intentionally or recklessly to perform any of the duties undertaken by it under the provisions of this Trust.
E. 
Notwithstanding anything to the contrary herein, the Township, or if so designated by the Township, the Administrator and the investment manager or another agent of the Township, will be responsible for valuing all assets so acquired for all purposes of the Trust and of holding, investing, trading and disposing of the same. The Township will indemnify and hold the Trustee harmless against any and all claims, actions, demands, liabilities, losses, damages or expenses of whatsoever kind and nature which arise from or are related to any use of such valuation by the Trustee or holding, trading or disposition of such assets.
F. 
The Trustee shall and hereby does indemnify and hold harmless the Township from any and all actions, claims, demands, liabilities, losses, damages and reasonable expenses of whatsoever kind and nature in connection with or arising out of the Trustee's failure to follow the directions of the Township, the Administrator, the investment manager or agents thereof, except as permitted by the last sentence of Subsection C above; any disbursements made without the direction of the Township, the Administrator, the investment manager or agents thereof; and the Trustee's negligence, willful misconduct or recklessness with respect to the Trustee's duties under this article.

§ 16-7 Disbursements and expenses.

A. 
The Township or its designee shall make such payments from the Trust at such time to such persons and in such amounts as shall be authorized by the agreement; provided, however, that no payment shall be made, either during the existence of or upon the discontinuance of the Trust, which would cause any part of the Trust to be used for or diverted to purposes other than the exclusive purpose of funding post-retirement benefits as described in this article.
B. 
The Township, Trustee and Administrator may be reimbursed for expenses reasonably incurred by them in the administration of the Trust. All such expenses, including, without limitation, reasonable fees of accountants and legal counsel to the extent not otherwise reimbursed, shall constitute a charge against and shall be paid from the Trust upon the direction of the Township.

§ 16-8 Accounting.

A. 
The Trustee shall not be required to keep accounts of the investments, receipts, disbursements and other transactions of the Trust, except as necessary to perform its title-holding function hereunder. All accounts, books and records relating thereto shall be maintained by the Township or its designee.
B. 
As promptly as possible following the close of each year, the Trustee shall file with the Township a written account setting forth assets titled to the Trust as reported to the Trustee by the Township or its designee.

§ 16-9 Miscellaneous provisions.

A. 
Neither the Trustee nor any affiliate thereof shall be required to give any bond or to qualify before, be appointed by or account to any court of law in the exercise of its powers hereunder.
B. 
No person transferring title or receiving a transfer of title from the Trustee shall be obligated to look to the propriety of the acts of the Trustee in connection therewith.
C. 
The Township shall have the right at all reasonable times during the term of this article, and for three years after the termination of this article, to examine, audit, inspect, review, extract information from and copy all books, records, accounts and other documents of the Trustee relating to this article and the Trustee's performance hereunder.

§ 16-10 Amendment and termination.

A. 
The Township reserves the right to alter, amend or (subject to the provisions on disbursements and expenses; see § 16-7) terminate this article at any time for any reason without the consent of the Trustee or any other persons, provided that no amendment affecting the rights, duties or responsibilities of the Trustee shall be adopted without the execution of the Trustee to the amendment. Any such amendment shall become effective as of the date provided in the amendment, if requiring the Trustee's execution, or on delivery of the amendment to the Trustee, if the Trustee's execution is not required.
B. 
Upon termination of this article and upon satisfaction of all liabilities of the Township to provide such benefits, any amount of Township contributions, plus accrued earnings thereon, remaining in the accounts shall be returned to the Township.

§ 16-11 Limited effect of Trust.

Neither the establishment of the Trust or any modification thereof, the creation of any fund or account nor the payment of any benefits shall be construed as giving to any person any legal or equitable right against the Trustee, the Administrator, the Township or any officer or employee thereof, except as otherwise may be expressly provided for in this article.

§ 16-12 Liability for validity of insurance contract.

Neither the Administrator, the Township nor the Trustee shall be responsible for the validity of any contract of insurance or other arrangement maintained in connection with this article or for the failure on the part of the insurer or provider to make payment provided by such contract or for the action of any person which may delay payment or render a contract void or unenforceable in whole or in part.