[Adopted 7-8-2003 by Ord. No. 2003-11]
As used in this article, the following terms
shall have the meanings indicated:
AGE
The age attained by the employee at his or her last birthday.
BOROUGH
The Borough of New Hope, Bucks County, Pennsylvania.
COMPENSATION
All W-2 earnings paid by the Borough to the member during
a plan year.
COUNCIL
The Council of the Borough of New Hope, Bucks County, Pennsylvania.
EMPLOYEE
Any person in the full-time employ of the Borough whose customary
employment by the Borough is for not less than 35 hours per week.
FORFEITURE
The non-vested portion of a member's account.
FUND
All assets held by the trustee under the Trust Agreement
and related insurance and investment contracts relating to this Plan.
MEMBER
Any employee who has satisfied the eligibility requirements established in §
30-2 hereof.
MEMBER ACCOUNT
Each member's individual account maintained within the Fund
to include the prorated share of investment earnings or losses.
NORMAL RETIREMENT DATE
The first day of the month coincident with or next following
the date on which the member completes seven years of service or the
date on which the member attains age 65.
PAY PERIOD
The period of time at which end an employee is compensated
for his services to the Borough.
PLAN
The Pension Plan for the Nonuniformed Employees of the Borough
of New Hope, as herein set forth and as the same may hereafter be
amended.
PLAN YEAR
A period of 12 consecutive months commencing on any January
1 and ending on the following December 31.
ROLLOVER ACCOUNT
The distribution amount transferred to the Plan by a member
from a qualified pension or profit sharing plan.
SERVICE
The aggregate of a member's total periods of employment as
a full-time employee of the Borough. If a member enters military service,
either voluntarily or by conscription, after he has been employed
for at least six months, such time spent in the armed forces of the
United States during a period of national emergency shall be counted
as service for purposed of this Plan, provided such member returns
to service with the Borough within six months after his discharge
or release from such active duty in the armed forces of the United
States. The time spent in military service due to voluntary extension
of such military service during a period of peacetime shall not be
included as service for the purpose of this Plan. Time spent on Reserve
or National Guard Training shall be included as service for purposes
of this Plan.
TOTAL DISABILITY
Any condition arising from illness or injury which precludes
an employee from performing the duties associated with the normal
occupation requirements of any position with the Borough as certified
by a physician designated by the Borough.
TRUST AGREEMENT
The contract between the Borough and the trustee establishing
the terms by which and under which the Fund is invested, distributed,
accounted for and terminated, as the same now exists and as it may
hereafter be amended.
TRUSTEE
The Council of New Hope Borough or any other agency or person
appointed by the Council to serve in that capacity as set forth in
the Trust Agreement.
VESTED INTEREST
The nonforfeitable right to any immediate or deferred benefit
in the amount which is equal to the sum of Subsections A and B below:
A.
The value on that date of that portion of the
participant's account that is attributable to and derived from a participant's
own contributions, if any.
B.
The value on that date of that portion of the
participant's account that is attributable to and derived from employer
contributions multiplied by his vesting percentage determined on the
date applicable.
VESTING PERCENTAGE
The member's nonforfeitable interest to his account plus
earnings thereon, computed in accordance with the following schedule
based on years of service with the Borough:
Service
(whole years)
|
Vesting Percentage
|
---|
Less than 3
|
0%
|
3
|
20%
|
4
|
40%
|
5
|
60%
|
6
|
80%
|
7 or more
|
100%
|
[Adopted 6-14-2005 by Ord. No. 2005-8]
If a member leaves the employ of the Borough or ceases to be a member whether by reason of his transfer, resignation or discharge, or by reason of disability or retirement other than after becoming eligible for benefits pursuant to §
30-16 or
30-17 of this plan, he shall be entitled to a refund of all contributions made by him and then on deposit in the fund, plus interest thereon, computed at the rate described in §
30-15A. However, a member who has completed 12 or more years of service may elect either Subsection A or Subsection B as described below:
A. He may elect to leave his contributions, plus interest in the fund so as to receive a vested pension benefit to start at his normal retirement date. He must file with the Secretary of the Borough within 90 days of the date he ceases to be a full-time police officer, a written notice of his intention to vest. The amount of the vested pension benefit shall be (x) divided by (y) where (x) is the number of years of service at the date of termination and (y) is the number of years of service which the member would have had if he worked until normal retirement date, multiplied by the benefits described in §
30-16A. Years of service shall be measured in years and completed months.
B. He may elect to receive a refund of all contributions made by him and then on deposit in the Trust Fund, plus interest thereon, computed at the rate described in §
30-15A. If he elects to receive the refund of his contributions plus interest, he would forfeit the pension benefit outlined in Subsection
A.
[Added 11-17-2015 by Ord.
No. 2015-06]
A. Title. This section shall be known as the "New Hope Police Deferred
Retirement Option Plan."
B. Definitions. When used in this section, the below words shall have
the meaning indicated.
BOROUGH
Borough of New Hope, Bucks County, Pennsylvania.
DROP
The Deferred Retirement Option Plan referred to in the collective
bargaining agreement between the New Hope Police Benevolent Association
and the Borough of New Hope.
DROP ACCOUNT
Separate ledger account created to accept a DROP participant's
monthly pension benefit while a DROP participant, as well as any interest
thereon.
PARTICIPANT
A police officer who meets the eligibility for and has executed
the proper documents for participation in DROP and has had such application
approved by the Borough.
C. Eligibility. Eligibility for the DROP shall be determined as follows:
police officers who have not retired prior to the implementation of
the DROP may enter into the DROP on the first day of any month following
completion of 25 years of credited service and attaining the age of
55.
D. Written election. Eligible officers who wish to be participants in
the DROP must signify that intention in writing as follows:
(1) A police officer electing to participate in the DROP must complete
and execute a DROP Participation Election Form to be filed with the
Chief Administrative Officer at least 30 days prior to the date that
the employee is eligible to receive a normal retirement benefit under
the Plan, which shall evidence the member's election to participate
in the DROP. The form must be signed by the police officer and be
notarized and submitted prior to the date on which the member wishes
DROP participation to commence. The DROP 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 four years from the effective date of
the DROP 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 DROP status, which shall terminate his/her
participation in the DROP.
[Amended 2-21-2023 by Ord. No. 2023-01]
(2) In addition to the above information, the DROP Participation Election
Form shall also advise the employee of the following: a) an explanation
of the participant's rights and obligations while in DROP; b) that,
as a condition of DROP participation, the participant foregos active
participation in the Police Pension Plan and foregos any recalculation
of pension benefits to include salary increases occurring after DROP
participation commences; c) that, also as a condition of DROP participation,
the participant agrees to hold the Borough harmless for any financial
consequences, for example, tax or investment consequences, flowing
from any aspect of DROP participation, including, but not limited
to, the decision to participate in the DROP; and d) that the DROP
participant's service while in DROP 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 DROP
participation. A DROP participant must also complete any and all retirement
documents required by the Police Pension Plan Administrator, and such
documents must be filed and presented to the Borough for approval
of retirement and payment of pension. Once a DROP Participation Election
Form has been approved by the Borough, it is irrevocable. Likewise,
once a DROP participant enters the DROP, the participant may not subsequently
leave and then reenter the DROP, 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 DROP shall remain as it existed
on the effective date of commencement of participation in the DROP.
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 DROP. Earnings or increases
in earnings thereafter shall not be recognized or used for the calculation
or determination of any benefits payable by the Pension Plan. 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 DROP or by applicable cost of living
adjustments granted thereafter.
F. Pension contributions during DROP participation. A police officer
participating in the DROP shall not make any required pension contribution
during DROP service.
G. Accumulation of the DROP 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 DROP, accumulate to the
benefit of that officer and be accounted for on that police officer's
DROP account. Participants shall not have the option of self-directed
investment of their individual DROP account while in the DROP. Instead,
the monies shall be invested in a fund to be identified and selected
solely 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%.
H. Accrual of nonpension benefits. After a police officer elects to
participate in the DROP, all other contractual benefits shall continue
to accrue with the exception of those provisions relating to the Police
Pension Plan. However, either prior to participation in the DROP or
upon separation from employment, a participant may make a one-time
request for payment for any accrued but unused vacation or sick leave
time if the Borough is obligated to provide such payment upon the
participant's retirement pursuant to the provisions of the collective
bargaining agreement in effect at the time. A participant may utilize
leave time during the DROP period, but the Borough shall not be required
to buy back any such accrued and unused leave time at the end of the
DROP period if the participant elected payment for such time prior
to participation in the DROP.
I. Payout. Upon separation from employment, the DROP payout options
available to the DROP participant shall be as follows:
(1) The balance of the DROP participant's account, less withholding taxes,
if any, remitted to the Internal Revenue Service, shall be paid within
45 days of the receipt of the election form by the Plan from the account
to the participant or the participant's surviving beneficiary.
(2) The balance of the DROP participant's account shall be paid within
45 days of the receipt of the election form, by the Plan from the
account 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 DROP participant, an eligible retirement plan that is an
individual retirement account or an individual retirement annuity
as defined by Internal Revenue Code Section 402(c)(9).
(3) If the DROP participant or beneficiary fails to make an election within 60 days following the date of termination of DROP participation, then the Borough shall implement Subsection
I(1) above.
(4) The form of payment selected by the DROP participant or surviving
beneficiary shall comply with the minimum distribution requirements
of the Internal Revenue Code of 1986. The terminating DROP participant
shall commence receipt of the monthly retirement benefit directly
starting with the first day of the month coincident with or next following
termination of employment with the Borough. The DROP shall at all
times comply with the annual benefit limitations of Internal Revenue
Code Section 415 and the regulations thereto.
J. Service connected disability during DROP. If a DROP participant becomes
temporarily incapacitated due to a service-connected injury during
his participation in DROP, that police officer shall continue to participate
in the DROP as if fully employed. The police officer shall receive
disability pay in the same amount as disabled police officers that
are not participating in DROP. In no event shall a police officer
on temporary disability have the ability to draw from his DROP 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 Plan 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 DROP
supersede or limit in any way the right of the Borough to honorably
discharge a police officer based upon an inability to perform his
or her full duties as a police officer. If a DROP participant becomes
eligible for a service-connected disability pension and his 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 DROP participant shall
be reclassified as being on account of a service-connected disability.
In no event shall a DROP participant's monthly retirement benefit
be recalculated. The DROP participant's monthly retirement benefit
shall remain 50% as calculated at the time of entry into the DROP.
K. Death. If a DROP participant dies, the participant's eligibility
for DROP shall terminate upon the date of death. In such case, if
the DROP 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.
L. Forfeiture of benefits. Notwithstanding a police officer's status
as a DROP 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 Public Employee Pension Forfeiture Act,
43 P.S. §§ 1311 through 1314, shall forfeit his right
to receive a pension, including any amounts currently deposited in
the DROP 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.
M. Cost of management for DROP. The New Hope Police Benevolent Association
and the Borough agree that any costs or fees associated with the management
of the DROP accounts shall be paid directly from the Pension Fund
and not by the Borough.
N. Amendment. Any amendments to this DROP section 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 DROP participants and upon all DROP participants
who have balances in their individual retirement option accounts.
The DROP may only be amended by a written instrument, not by any oral
agreement or past practice.
O. Construal of provisions. A police officer's election to participate
in the DROP 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.
P. Severability. The provisions of the DROP 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 DROP shall
not be affected thereby. It is hereby expressly declared as the intent
of the Borough that the DROP would have been adopted had such unconstitutional
or illegal provision or provisions not been included herein.
Q. Effective date. The effective date of the DROP shall be January 1,
2015.