[HISTORY: Adopted by the Board of Supervisors
of Lower Frederick Township 2-7-2006 by Ord. No. 06-02. Amendments noted where
applicable.]
A.
There is hereby established in Lower Frederick Township, Montgomery County, Pennsylvania, a police pension fund to be maintained by a charge against each full-time member of the police participating in the fund, by annual appropriations made by the municipality, by payments made by the State Treasurer to the municipality from moneys received from taxes paid upon premiums by foreign casualty insurance companies for the purposes of pension retirement for policemen and by gifts, grants, devises or bequests granted to the pension and pursuant to § 17-4 hereof.
B.
Such fund shall be under the direction of the Board
and shall be applied for the benefit of such contributing members
of the police force as shall receive honorable discharge therefrom
by reason of age and service and for death and disability benefits
as hereinafter provided.
The following terms, whenever used or referred
to, shall have the following meaning. except in those instances where
the context indicates otherwise:
As of any given date, the benefit determined under § 17-8B, multiplied by a fraction, the numerator of which shall be the participant's total police service determined as of such date and the denominator of which shall be the total police service which would be credited to the participant as of his normal retirement date if he were to continue to be employed as a full-time permanent police officer with the employer until such date.
The Municipal Pension Plan Funding Standard and Recovery
Act, enacted as P.L. 1005, (Act 205 of 1984), as amended.
An "approved actuary," as defined in the Act.
January 1.
An unpaid, temporary cessation from active employment with
the employer pursuant to an established nondiscriminatory policy,
whether occasioned by illness, military service, or any other reason.
MATERNITY OR PATERNITY LEAVE OF ABSENCEAn absence from work for any period by reason of the employee's pregnancy, birth of the employee's child, placement of a child with the employee in connection with the adoption of such child, or any absence for the purpose of caring for such child for a period immediately following such birth or placement. The total hours of service required to be credited for a maternity or paternity leave of absence shall not exceed 501 hours.
The person to whom the share of a deceased participant's benefit is payable, subject to the restrictions of § 17-10.
The Board of Supervisors of Lower Frederick Township, Montgomery
County, Pennsylvania.
A plan year during which an employee has not completed more
than 500 hours of service with the employer. An employee shall not
incur a break in service for the plan year in which he becomes a participant,
dies, retires or suffers total and permanent disability. Further,
solely for the purpose of determining whether a participant has incurred
a break in service, hours of service shall be recognized for authorized
leaves of absence and maternity and paternity leaves of absence.
A person designated by motion of the Board of Supervisors.
The Internal Revenue Code of 1986 and amendments thereto.
With respect to any participant, means actual W-2 income
from the employer for a plan year, including base pay, court pay,
holiday pay, overtime pay, and any other remuneration.
The benefit paid from the pension fund to the families of such members of the Police Department as may be killed in service, the amount and the commencement of the payments as outlined in § 17-10.
The Township of Lower Frederick Township, Montgomery County,
Pennsylvania.
A person who has been a participant but who has ceased to
be a participant for any reason.
Each hour for which an employee is paid, or entitled to payment,
for the performance of duties.
A legal reserve life insurance company, licensed in the Commonwealth
of Pennsylvania, which shall issue a policy or contract under this
plan.
A series of payments under which payments, once begun, continue
throughout the remaining lifetime of the annuitant.
The average monthly salary earned by the participant and
paid by the employer during the final 36 months immediately preceding
retirement, which are included in the averaging period.
Lower Frederick Township, Montgomery County, Pennsylvania.
The age at which each participant shall be entitled to his
normal retirement benefit provided he retires on or after his normal
retirement date.
The benefit paid from the pension fund to members of the
Police Department as shall receive honorable discharge, provided he
retires on or after his normal retirement date.
Any eligible employee who has become a member of the plan by satisfying § 17-6, and has not for any reason become ineligible to participate further in the plan.
The total amount contributed by a participant to this plan
or its predecessor, plus interest credited at a uniform rate determined
by the municipality.
The police pension fund administered under the terms of this
plan and which shall include all money, property, investments, policies
and contracts standing in the name of the plan.
The Lower Frederick Township Police Pension Plan.
The benefits counselor appointed upon motion of the Board
of Supervisors to administer the provisions of the plan. In the event
that no such appointment is made, the Plan Administrator shall be
the Board of Supervisors.
The plan's accounting year of 12 months commencing on January
1 of each year and ending the following December 31 (also applicable
prior to the effective date of this plan).
A municipal employee who holds a position or an office in
the Police Department of the municipality and has retirement coverage
provided by the police pension plan. A full-time police officer is
one who customarily works at least 40 hours in a week and 40 weeks
in a year or the comparable hours as found in the police employment
contract.
Base pay, excluding overtime and other extraordinary remuneration.
Discontinuance of active employment for reasons other than
death, total and permanent disability or retirement.
A physical or mental condition of a participant resulting
from bodily injury, disease, or mental disorder which renders him
incapable of continuing his usual and customary employment with the
employer. A physician chosen by the employer shall make any such determination.
The total period of continuous employment with the employer
and shall be measured in terms of years of credited service and fractions
thereof. For purposes of this section, a police officer's employment
shall not be deemed to have been interrupted by any periods of authorized
leave of absence. In the event a police officer does not return to
employment within the specified period following an authorized leave
of absence, termination of employment shall be deemed to have occurred
when he originally left the service of the employer.
The Board of Supervisors of Lower Frederick Township.
The present value of any participant's benefits accrued prior
to the enactment of this plan by virtue of his/her prior service with
the municipality.
The portion of a participant's account that is nonforfeitable.
The computation period of 12 consecutive months of continuous
employment during which a police officer works full time. Unless specified
elsewhere, the computation period shall be the plan year.
Completion of a year of service with the employer as a police
officer eligible for coverage under this plan. No years of credited
service shall be given for any period during which participant contributions
are required as a condition of participation in this plan, unless
the police officer makes such contributions in accordance with the
plan. Years of credited service shall include completed years and
fractions thereof.
A.
The Board shall administer the plan established pursuant
to this chapter by such regulations as shall from time to time be
necessary for the effective maintenance of the plan, provided that
no regulation shall be contrary to the statutes of the Commonwealth
of Pennsylvania and/or applicable federal regulations.
B.
The Board shall keep a record of all its proceedings
and acts which shall relate to the plan and shall keep all such books
of accounts, records, and other data as shall be necessary for the
proper administration of the plan.
C.
All such reasonable expenses incurred in the administration
of the plan, including but not limited to fees for the services of
specialists including actuaries, accountants, and legal counsel, shall
be approved by the Board and may be paid by the pension fund, provided
that no such payment shall be contrary to the statutes of the Commonwealth
of Pennsylvania.
A.
Funding. Participants shall pay into the fund monthly
an amount equal to 5% of their compensation. The Township, at its
sole choice and option, and expense, may elect to pay into the fund
monthly the required 5% on behalf of each participant. If the Township
chooses to make such payment, such payment will replace the 5% that
each participant is required to pay into the fund. The Township reserves
the right to terminate such payments at any time, at which point each
participant will again be required to pay into the fund monthly an
amount equal to 5% of their compensation. The aforesaid contributions,
together with the other sources of revenue as herein provided, shall
be devoted exclusively to the purposes of this plan.
[Amended 6-2-2008 by Ord. No. 08-02]
B.
Application of state aid. Applications of General
Municipal Pension System State Aid, or any other amount of state aid
received in accordance with the Act, which are received by the employer
and deposited into the pension fund governed by this plan, shall be
used as follows:
C.
Employer contributions. The remainder of the needed
annual contributions determined by the actuary in accordance with
the Act, other application of state aid and participant contributions
shall become the obligation of the employer and shall be paid into
the pension fund by annual appropriations.
D.
The police pension fund is hereby authorized to take
by gift, grant, devise or bequest any money or property, real, personal
or mixed, in trust, for the benefit of such funds, and the care, management,
investment and disposal of such trust funds or property shall be vested
in the Board, and the said trust fund shall be governed by regulations
prescribed by the Board subject to such directions not inconsistent
therewith as the donors of such funds and property may prescribe.
E.
If an actuarial study shows that the condition of
the police pension fund is such that payments into the fund by members
may be reduced below the minimum percentage above prescribed, or eliminated,
contributions by the municipality will not be required to keep the
fund actuarially sound. The Board of Supervisors may, on an annual
basis, by resolution, reduce or eliminate payments into the fund by
members.
Any member who, for any reason whatsoever, shall
be ineligible to receive a pension upon the termination of his employment
as a police officer of the municipality after having contributed any
charges to the fund established pursuant to this plan shall be entitled
to a refund of all moneys paid by him into such fund plus 5% simple
annual interest immediately upon the termination of such employment
in the following manner:
A.
If the termination of his employment is due to death,
the face amount of any and all annuity or life insurance policies
providing for death benefits shall be paid to his designated beneficiary
or, in the absence thereof, to his estate, in accordance with the
terms of the said policies. All annuity policies issued on his account
but containing no death benefits shall be cashed forthwith and the
proceeds thereof shall become a part of the general assets of the
pension fund. No payments in addition to the foregoing will be made
on behalf of a deceased member under this subsection except to the
extent that his participant account shall exceed the face value of
the annuity or life insurance policies providing for death benefits.
B.
If the termination of his employment is due to total and permanent disability, the amount of any monthly income payments provided through disability income insurance policies, if any, shall be paid in accordance with the terms of said policies. All annuity policies issued on his account but containing no death benefits shall be cashed forthwith and the proceeds thereof shall become part of the general assets of the pension fund and used along with any insurance payments to provide the disability pension under § 17-9. No payments in addition to the foregoing will be made on behalf of a deceased member under this subsection.
C.
If the termination of employment as a municipality
police officer shall be due to any reason other than his death or
total and permanent disability, all annuity or life insurance policies
purchased on his account shall be cashed by the municipality. However,
such former member shall, immediately upon the cashing of said policies,
be paid out of the cash proceeds thereof the value of his participant
account, and the balance of the cash proceeds shall become a part
of the general assets of the pension fund.
[Amended 7-6-2010 by Ord. No. 10-02]
Each police officer who is full-time employee
as defined by the plan shall become a participant in the plan on the
effective date of this section. Any police officer who is either hired
as a full-time employee or becomes a full-time employee shall become
a participant in the plan on the date he or she is hired or the date
his or her status is changed to full-time employee.
A.
A participant shall have a vested interest according
to the following schedule:
|
Years of Total Police Service
|
Percent of Vested Interest
| |
|---|---|---|
|
1-11
|
0%
| |
|
12+
|
100%
|
B.
A participant shall be vested 100% immediately, regardless
of his years of total police service, if he shall be honorably discharged
from the Police Department by reason of total and permanent disability
from permanent injuries incurred in-service. Vesting under this subsection
occurs only if the officer receives permanent injuries while performing
authorized duties in his official capacity as a police officer for
Lower Frederick Township.
A.
In order to become entitled to benefits, a participant
shall have a minimum period of total police service not less than
an aggregate of 25 years with the municipality Police Department and
shall have attained the age of 55 years, after which he shall be eligible
for retirement from active duty, and such participants as are retired
shall be subject to service from time to time, as a police reserve,
until unfit for such service, when they shall be finally discharged
by reason of age or disability.
B.
The basis for determining any pension payable following
retirement of any participant meeting the service and age qualifications
above provided shall be as follows: monthly pension or retirement
benefits shall be computed at 1/2 the monthly average salary of such
member during the last 36 months of employment.
C.
Should any participant, before completing normal retirement
age and service requirements but after having completed 12 years of
total service, for any reason cease to be employed as a full-time
police officer by the municipality, he shall be entitled to vest his
accrued benefit by filing with the municipality within 90 days of
the date he ceases to be a full-time police officer a written notice
of his intention to vest. Upon reaching the date which would have
been his normal retirement date if he had continued to be employed
as a full-time police officer, he shall be paid a partial retirement
allowance determined by applying the percentage his total police service
bears to the total police service which he would have rendered had
he continued to work until his normal retirement date to the gross
pension, using, however, the monthly average salary during the appropriate
thirty-six-month period prior to his termination of employment.
D.
Payments made under the provisions of this plan shall
not be charged against any other fund in the treasury of this municipality
or under its control.
E.
Military service benefit. Any police officer employed
by the municipality who has been a regularly appointed employee for
a period of at least six months and who thereafter shall enter into
the military service of the United States shall have credited to his
employment record for purposes of determining retirement benefits
under this plan all of the time spent by him in such military service,
provided that such police officer returns to his employment with employer
within six months after his separation from the service.
F.
Annuity. The standard form of annuity at retirement
shall be a life annuity.
A.
In addition to the pension or retirement benefits as provided for in § 17-8, there shall be a disability pension per § 17-7B, for such members of the Police Department as shall receive honorable discharge therefrom by reason of disability, if said injury occurs during such time as they shall be in-service.
B.
The benefit must be in conformity with a uniform scale
and fixed by the plan’s governing document at no less than 50%
of the member’s salary at the time the disability was incurred,
reduced by the amount of Social Security disability benefits received
for the same injury.
[Amended 7-6-2010 by Ord. No. 10-02]
C.
Disability insurance in an amount necessary to cover
the risk may be purchased by the Board.
Widows' and children's benefits shall be determined
as follows:
A.
In case of the death of a nonvested participant, from
any cause whatsoever, during such time as he shall be actively employed
as a member of the municipality Police Department, his designated
beneficiary or his estate, as the case may be, shall receive such
death benefits as are hereinafter prescribed by policies of life insurance
and shall not be entitled to any other benefits from the police pension
fund.
B.
A lifetime survivor’s benefit must be provided
to the surviving spouse (or if no spouse survives or if he or she
subsequently dies, the child or children under 18 years of age or
if attending college, under or attaining the age of 23) at no less
than 50% of the pension the member was receiving or would have been
entitled to receive had he been retired at the time of death. (“Attending
college” shall mean the eligible children are registered at
an accredited institution of higher learning and are carrying a minimum
course load of seven credit hours per semester.)
[Amended 7-6-2010 by Ord. No. 10-02]
C.
In case of the death of a vested participant during such time as
he shall be actively employed on a full-time basis as a member of
the municipality Police Department, said surviving spouse or children
shall be entitled to receive the death benefits as are prescribed
by policies of life insurance, if any. If a member is killed in service,
the Chief of Police shall, within 90 days of the date of death, submit
certification of such death to the Commonwealth of Pennsylvania to
comply with the requirements of 53 P.S. § 891, and to take
such other action as is necessary to allow member's beneficiaries
to collect the killed-in-service benefit provided for by the Commonwealth
in 53 P.S. § 891 et seq.
[Amended 11-8-2017 by Ord. No.
17-02]
The trust will consist of all funds held by
the trustee, including the contributions, investments, reinvestments
and proceeds thereof. The trust shall be held, managed, and administered
in trust pursuant to the terms hereof. The trustee hereby accepts
the trust created hereunder and agrees to perform the duties assigned
to it hereunder. Except as otherwise expressly provided for, the trustee
has exclusive authority and discretion to manage and control the trust
assets.
A.
The trustee shall invest and reinvest the principal
and income of the fund and keep the fund invested, without distinction
between principal and income, in such individual or group annuity
contract, certificate of deposit, securities, and/or other investments
as the trustee shall deem acceptable.
B.
Life insurance and endowment policies. The municipality
may continue to pay premiums for policies issued by an insurer prior
to January 1, 1986. The municipality shall be the owner of all such
policies and shall retain all rights of ownership, including but not
limited to all rights of cashing, converting and electing options
thereunder. All life insurance policies shall be surrendered upon
a participant's retirement, and the cash surrender value proceeds
thereof shall become a part of the general assets of the pension fund.
A.
Actuarial valuations. The plan's actuary shall perform
an actuarial valuation at least biennially unless the employer is
applying or has applied for supplemental state assistance pursuant
to Section 603 of the Act, whereupon actuarial valuation reports shall
be made annually.
(1)
Such actuarial valuation shall be prepared and certified
by an approved actuary, as such term is defined in the Act.
(2)
The expenses attributable to the preparation of any
actuarial valuation report or experience investigation required by
the Act or any other reasonable expense which is permissible under
the terms of the Act and which directly associate with administration
of the plan shall be an allowable administrative expense payable from
the assets of the pension fund.
B.
Duties of Chief Administrative Officer. Such actuarial
reports shall be prepared and filed under the supervision of the Chief
Administrative Officer.
C.
Benefit plan modifications. Prior to the adoption
of any benefit plan modification by the employer, the Chief Administrative
Officer of the plan shall provide to the Board of Supervisors a cost
estimate of the proposed benefit plan modification. Such estimate
shall be prepared by an approved actuary, which estimate shall disclose
to the Board the impact of the proposed benefit plan modification
on the future financial requirements of the plan and the future minimum
obligation of the employer with respect to the plan.
A.
Intent and interpretation. The pension plan is created
for the exclusive benefit of the police employees of the municipality
and shall be interpreted in a manner consistent with it being an employees'
trust.
B.
Construction. The plan is not to be construed as creating
or changing any contract of employment between the municipality and
its employees, and the municipality retains the right to deal with
its employees and to terminate their employment at any time to the
same extent as though these plans had not been created. Nothing in
this plan shall be construed as limiting the right of the municipality
to change the compensation of any employee at any time.
C.
Severability. If any section, subsection, sentence,
clause, phrase or portion of this plan is for any reason held invalid
or unconstitutional by any court of competent jurisdiction, such portion
shall be deemed a separate, distinct and independent provision and
such holdings shall not affect the validity of the remaining portions
hereof.
D.
Nonassignability of pension payments. The pension
payments herein provided for shall not be subject to attachment, execution,
levy, garnishment or other legal process and shall be payable only
to the member or his designated beneficiary and shall not be subject
to assignment or transfer.
E.
Nondeprivation of participation rights. No person
participating in the police pension plan, who becomes entitled to
receive a benefit therefrom shall be deprived of his right to an equal
proportionate share therein upon the basis upon which he first became
entitled thereto.
F.
Appointment of actuary. The Board may, upon motion,
appoint an actuary to examine the fund from time to time for compiling
a report for submission to any agency of the commonwealth and shall
fix his/her compensation to be paid from this pension fund.
G.
Amendment of the plan. The municipality may amend
this plan at any time or from time to time by an instrument in writing,
executed in the name of the municipality by officers duly authorized
to execute such instrument; provided, however:
(1)
That no amendment shall deprive any participant or
any beneficiary of a deceased participant of any of the benefits to
which he is entitled under this pension plan with respect to contributions
previously made;
(2)
That no amendment shall provide for the use of funds
or assets held under this pension plan other than for the benefit
of employees and no funds contributed to this pension plan or assets
of this pension plan shall, except as may be allowed by the Act, ever
revert to or be used or enjoyed by the employer; and
(3)
That no amendment to the pension plan that provides
for a benefit modification shall be made unless the cost estimate
has been prepared and presented to the Board of Supervisors in accordance
with the Act.
H.
Termination of the plan. The employer shall have the
power to terminate this pension plan in its entirety at any time by
an instrument in writing, executed in the name of the municipality
by officers duly authorized to execute such instrument, and shall
be done in accordance with the provisions of Act 205 and any other
applicable laws and/or statutes. In the event of the termination of
the plan, all amounts of vested benefits accrued by the affected participants
as of the date of such termination, to the extent funded on such date,
shall be nonforfeitable herein.
I.
Transfer of assets. The assets of the Township Pension
Fund already contributed by and/or on behalf of eligible participants,
as defined hereinabove, shall be convened to cash or transferred in
kind to be rolled over to become a part of the general assets of the
Police Pension Fund established herein. Such assets will be available
to the eligible participants to the extent and on the terms as herein
stated and allowed under Act 600 or according to the amounts already
vested up to the time of this chapter and the terms herein; if there
is any difference between return due to the officer, the officer may
elect such terms which are more favorable to the officer within 30
days of the termination of said officer's employ. This shall be at
the election of the officer; otherwise all disbursements to eligible
participants shall be as required by Act 600 and as authorized in
this chapter. The eligible participants shall lose no previously vested
rights but shall proceed under Act 600 henceforth.
