[Adopted 4-10-1985 by Ord. No. 731]
[Amended 12-28-1988 by Ord. No. 765[1] ]
The Township of Springfield hereby restates
and adopts a pension plan trust for its full-time hourly employees
who have satisfied the following requirements:
A.
The hourly employee has attained the age of 21.
B.
An hourly employee may become a participant in the
plan immediately upon employment. The hourly employee must agree to
make employee contributions, if any, and must work at least a minimum
of 40 hours per week.
[Amended 12-28-1988 by Ord. No. 765[2]]
[2]
Editor's Note: This ordinance also provided
that it would be effective 1-1-1989. Former Subsection C, concerning
the employee not having attained the age of 55, which immediately
followed this subsection, was repealed 4-10-2002 by Ord. No. 852.
[1]
Editor's Note: This ordinance also provided
that it would be effective 1-1-1989.
The plan restated is the Springfield Township
Hourly Employees Pension Plan and Trust in effect on the date of the
within article and as amended from time to time in the future.
The Board of Commissioners of the Township of
Springfield is hereby directed and authorized to execute the Springfield
Township Hourly Employees Pension Plan and Trust and shall perform
all of the duties and responsibilities assigned to it and may, at
the discretion of the Board of Commissioners, exercise all powers
vested in it by the Trust Agreement.
The hourly employees of the Township shall have
all rights and duties and may exercise any or all options granted
them by the terms of the Trust Agreement as follows:
A.
Retirement date.
(1)
Normal retirement. The normal retirement date is the
first day of the month coinciding with or next following the member's
62nd birthday, provided that a minimum of 10 years of service has
been completed. It is anticipated that pension payments will begin
on the member's normal retirement date.
[Amended 12-28-1988 by Ord. No. 765[1] ]
[1]
Editor's Note: This ordinance also provided
that it would be effective 1-1-1989.
(2)
Early retirement. A member who has completed 25 or
more years of continuous service may elect to retire before his normal
retirement date and receive an actuarially reduced pension.
(3)
Late retirement. With the consent of the Board, a
member may retire after his normal retirement date. However, it shall
be mandatory that pension benefits will begin no later than the participant's
70th birthday.
(4)
Vesting benefits. A participant may vest his benefits
in the Springfield Township Hourly Pension Plan after completing service
requirements based upon the following schedule:
[Amended 12-28-1988 by Ord. No. 765[2]]
(a)
Two years of service: 20% vesting credit.
(b)
Three years of service: 40% vesting credit.
(c)
Four years of service: 60% vesting credit.
(d)
Five years of service: 80% vesting credit.
(e)
Six years of service: 100% vesting credit.
[2]
Editor's Note: This ordinance also provided
that it would be effective 1-1-1989.
B.
Amount of normal pension.
[Amended 3-12-1986 by Ord. No. 740[3]]
(1)
A member's yearly pension, at normal retirement date,
will equal 37 1/2% of the member's average annual earnings. This
pension benefit at retirement will be reduced by 1/25 for each year
of service less than 25 years and will be increased by 1 3/4%
for each year of service completed in excess of 25 years.
[4]
Editor's Note: This ordinance also provided
that the effective date is retroactive to January 1, 1995.
(2)
"Average annual earnings" is defined as the average
of a member's annual taxable earnings which are subject to withholding
for the three highest paid consecutive calendar years preceding retirement
date.
[Amended 12-28-1988 by Ord. No. 765; 2-9-2005 by Ord. No.
869]
(3)
In no event will this pension benefit be less than
the pension benefit credited to the member prior to January 1, 1979.
[3]
Editor's Note: This ordinance also provided
that it would be effective 1-1-1989.
C.
Member contributions.
(1)
Contributions are required of a participant unless
an actuarial study shows that the condition of the Hourly Pension
Plan is such that the payments into the fund by members may be reduced
or eliminated. Interest shall be credited to each participants contributions
at the end of each plan year. The amount of interest shall be determined
by the interest rate used by the actuary for the funding of the plan
benefits.
[Amended 12-12-1988 by Ord. No. 765[5]]
[5]
Editor's Note: This ordinance also provided
that it would be effective 1-1-1989.
(2)
A member's contributions will be deducted from his
earnings each pay day.
D.
Death benefits prior to retirement.
[Amended 11-12-1997 by Ord. No. 826; 7-9-2008 by Ord. No.
893]
(1)
If a vested member of the Springfield Township Hourly
Employees Pension Plan dies in service, while performing the functions
of his/her position, the surviving spouse is immediately eligible
to receive 50% of the pension benefits calculated as if the member
had retired at the time of death.
(2)
If a vested member of the Springfield Township Hourly
Employees Pension Plan dies while not in service, not performing the
functions of his/her position, after the pension plan member was eligible
to retire, the surviving spouse is immediately eligible to receive
50% of the pension benefits calculated as if the member had retired
at the time of death.
(3)
If a vested member of the Springfield Township Hourly
Employee Pension Plan dies while not in service, not performing the
functions of his/her position, prior to the member being eligible
to retire, the surviving spouse is eligible to receive 50% of the
pension benefits calculated as if the member had retired at the time
of death, at the time when the member would have otherwise been eligible
for a normal retirement.
E.
Benefits after retirement.
[Amended 12-28-1988 by Ord. No. 765[6]]
(1)
The regular pension is paid monthly beginning on the
member's normal retirement date, and, if the member is not married,
continues for so long as he may live thereafter, with the further
provision that if the member is married, 50% of the benefit the retiree
was receiving at the time of his death will be continued after his
death during the remaining lifetime of his surviving spouse, if any
(known as the "joint pensioner").
[Amended 2-9-2005 by Ord. No. 869]
(2)
Postretirement cost-of-living benefits. On the anniversary
of the plan, a member of the pension plan who retired on or after
January 1, 1986, shall be eligible for a cost-of-living adjustment
to his gross retirement annuity based upon the following conditions:
[Amended 10-9-1996 by Ord. No. 818[7]]
(a)
A retired participant must have been receiving
his annuity benefits for at least one year prior to being eligible
for a cost-of-living adjustment.
(b)
The annual cost-of-living adjustment may not
exceed the Philadelphia area consumer price index as measured from
a twelve-month period from October to October of each calendar year.
[Amended 6-10-2020 by Ord. No. 966]
(c)
The cumulative total of the cost-of-living adjustments
to the retired participants annuity cannot exceed 30%.
[7]
Editor's Note: This ordinance also provided
that the effective date is retroactive to January 1, 1995.
[6]
Editor's Note: This ordinance also provided
that it would be effective 1-1-1989.
F.
Optional forms of pension. Instead of receiving the
normal pension form, an employee may elect to have the actuarial equivalent
of his benefits paid to him in any one of the following forms:
[Amended 12-28-1988 by Ord. No. 765; 10-9-1996 by Ord. No.
818; 2-9-2005 by Ord. No. 869]
(1)
Benefit payable for life of member. A member may elect
to receive the benefit in equal monthly installments during the member's
lifetime and ceasing upon his death.
(2)
Ten-year certain. A member may elect to receive the
benefit payable for 120 months and as long as he lives thereafter.
If the member dies before he has received 120 monthly pension payments,
the pension payments will be continued to his beneficiary until a
total of 120 monthly pension payments have been made to the member
and his beneficiary combined.
(3)
Liability reduction for separated employees. If a
member separates employment for any reason and the lump sum value
of his vested accrued benefit equals $5,000 or less, then the Township,
in its sole discretion, may pay such lump sum from this plan. Upon
such payment, this plan shall have no further liability to the separated
employees.
G.
Termination of service.
(1)
If a member terminates service with the Township before
his normal retirement date, he may elect one of the following options:
(a)
Cash option.
[1]
He may have the contributions he has made under
the plan returned to him with interest, compounded annually on each
contribution from the January 1 following the date it was paid to
the first of the month in which the election is made. The interest
rate shall be determined by the interest rate established by the actuary
for the funding of plan benefits. If the member elects this option,
all benefits under the plan will be canceled.
[2]
The cash settlement will ordinarily be paid
in one sum, but the plan reserves the right to pay it in 12 monthly
installments.
[3]
A member may not withdraw the contributions
he has made under the plan as long as he remains in the service of
the Township, nor may be borrow against them at any time.
(b)
Pension option.
[1]
He may leave the amount which would be payable
to him under the cash option above with the plan and receive the pension,
beginning at his normal retirement date, which can be purchased by
this amount.
[2]
A member whose service is terminated by the Township and who does not terminate of his own accord, who has completed 10 or more years of continuous membership in the plan and who elects the option in Subsection G(1)(b)[1] above, will retain a vested interest in the pension previously credited to him through Township contributions to the plan.
H.
Temporary absence.
[Added 12-12-2001 by Ord. No. 849]
The Hourly Employees Pension Plan is intended
to be tax qualified under the applicable provisions of Section 401(a)
of the Internal Revenue Code, as amended, and shall be construed and
applied in a manner consistent with such intent. The plan and its
trust fund are for the exclusive benefit of plan members and their
beneficiaries.
A.
CODE
COMPENSATION
MUNICIPALITY
PLAN
PLAN YEAR
REGULATION(S)
Definitions. As used in this section, the following
terms shall have the meanings indicated:
The Internal Revenue Code, as amended periodically.
Plan member's wages as defined in Code Section 3401(a) for
a plan year for which the municipality is required to provide the
plan member a written statement under Code Sections 6041(d), 6051(a)(3)
and 6052. Such 415 compensation shall include any elective deferrals
defined in Code Section 402(g)(3) and all amounts contributed or deferred
at the election of the plan members which are not includible in the
gross income of the plan member by reason of either Code Section 125,
402(e)(3), 402(h)(1)(B), 403(b), 414(h)(2) or 457.
To the Township of Springfield.
The Hourly Employees Pension plan.
The calendar year.
The Income Tax Regulations, as amended periodically.
B.
Distribution of benefits.
(1)
Unless the plan member otherwise elects, the payment
of benefits under the plan to the plan member will begin not later
than the 60th day after the latest of the close of the plan year in
which:
(2)
In the case of a plan which provides for the payment
of an early retirement benefit, a plan member who satisfied the service
requirements for such early retirement benefit, but separated from
the service (with any nonforfeitable right to an accrued benefit)
before satisfying the age requirement for such early retirement benefit,
is entitled upon satisfaction of such age requirement to receive a
benefit not less than the benefit to which he would be entitled at
the normal retirement age, actuarially reduced under regulations prescribed
by the Secretary.
(3)
A plan member's benefits must commence to be paid
not later than April 1 of the calendar year following the later of
the calendar year in which the member attains age 70 1/2 or the
calendar year in which the member retires. Such distributions must
equal or exceed the required minimum distribution, and otherwise be
made in a manner consistent with the requirements of Code Section
401(a)(9) and the regulations thereunder.
(4)
Required distributions must be made over the lifetime
or the life expectancy of the plan member or the joint lifetimes or
joint life expectancy of the plan member and the plan member's designated
beneficiary. The life expectancy of the plan member and the plan member's
spouse may be redetermined at the election of the plan member or the
plan member's spouse. Such an election is irrevocable, once made.
If no such election is made by the date benefit distributions must
commence then the life expectancy of the plan member and the plan
member's spouse shall not be recalculated. Tables V and VI of Regulation
1.72-9 shall be used for computing life expectancy or joint and survivor
life expectancy.
(5)
All benefit distributions to a plan member or the
plan member's beneficiary shall be in accordance with the incidental
death benefit requirements of Code Section 401(a)(9)(G) and the related
regulations.
C.
Compensation and benefit limitations. The limitations
and other requirements outlined below are intended to comply with
Code Section 415 and the regulations thereunder, the terms of which
are specifically incorporated herein by reference. The maximum compensation
limit and benefits limitations under the Code are as follows:
(1)
The compensation used in calculating a plan member's
benefit cannot exceed the limits of Code Section 401(a)(17), as adjusted
for cost-of-living increases, per Code Section 415(d).
(2)
General rule. In no event shall the annual retirement
benefit payable to a plan member under this plan, together with retirement
benefits provided under all qualified benefit plans maintained or
previously maintained by the municipality, for any "limitation year",
which shall be the calendar year, exceed the maximum benefit permitted,
as adjusted annually per Code Section 415(d), under Code Section 415(b)
(including any applicable grandfathering rules). This plan section
shall be applied in accordance with Code Section 415 and the regulations
thereunder.
(3)
Adjustments of limits.
(a)
Where a retirement benefit commences before
age 62, the Code Section 415(b)(1)(A) dollar limit shall be reduced
in accordance with Code Section 415(b)(2)(F). This reduction shall
not result in a limit that is less than:
(b)
Where a retirement benefit commences after age
65, the Code Section 415(b)(1)(A) dollar limit shall be increased
as described in Code Section 415(b)(2)(F).
(c)
The maximum benefit limit of Code Section 415(b)(1)
shall be applied to benefits in the form of a straight life annuity
(with no ancillary benefits) without regard to benefits attributed
to plan member contributions and rollover contributions. If the form
payable to a plan member is other than a single life annuity or a
Code Section 417(b) qualified joint and survivor annuity, the plan
member's benefit shall not exceed the actuarial equivalent of the
Code Section 415(b)(1) maximum payable in the form of a single life
annuity unless no such adjustment is required under Code Section 415
and related regulations.
(d)
Notwithstanding the other rules of the plan
and Code Section 415, if the plan member has not participated in a
defined contribution plan of the municipality, the member's annual
retirement benefit shall not be deemed to exceed the maximum benefit
limit if it does not exceed the Code Section 415(b)(4) limit of $10,000
as adjusted for plan participation or service of less than 10 years
in accordance with Code Section 415(b)(5).
(4)
Order of defined benefit plan reductions. If the plan
member participates or participated in any other defined benefit plan
of the municipality, and the plan member's aggregate annual retirement
benefit under this plan and such other plan exceeds the limits permitted
under Code Section 415, such plan member's benefit shall be first
reduced under this plan.
D.
Vesting.
(1)
Notwithstanding the plan's vesting schedule, upon
any amendment or restatement of the plan, a plan member's vested accrued
benefit shall not be less than the vested accrued benefit immediately
preceding such amendment or restatement.
(2)
Notwithstanding the plan's vesting schedule, a plan
member shall be 100% vested when the plan member completes the age
and service requirements for normal retirement at his normal retirement
date under the plan.
(3)
Notwithstanding the plan's vesting schedule, a plan
member shall be 100% vested in his accrued benefit (to the extend
funded) as of the date of partial or complete plan termination.
E.
Qualified domestic relations order. Notwithstanding § 63-13F, below, the plan shall recognize any Qualified Domestic Relations Order (QDRO) set forth under Code Section 414(p). Any plan member's benefits, rights or elections shall be subject to any rights afforded to the alternate payee by a QDRO. Further, a distribution to an alternate payee is permitted if authorized by a QDRO, even if the plan member involved has not separated from service and has not reached the earliest retirement age under the plan.
F.
Alienation. No plan member or beneficiary shall have any benefit subject to any type of alienation, anticipation, assignment, charge, encumbrance, pledge, sale or transfer. Further, no benefits shall be subject to or liable for any debts, contracts, engagements, liabilities or torts. The only exceptions to this subsection are those in § 63-13E, above and those referenced in Code Sections 401(a)(13)(C) and (D).
G.
Unlocatable member or beneficiary. If any portion
of a plan benefit is payable to a plan member or beneficiary at the
later of the plan member's 62nd birthday or his normal retirement
age and such benefit remains unpaid solely by reason that the municipality,
after sending a registered letter, to the last known address, return
receipt requested, and after diligent effort fails to locate the plan
member or beneficiary, the actuarial value of the benefit shall be
forfeited and applied towards reducing plan costs. If, subsequent
to the forfeiture, a plan member or beneficiary is located, the actuarial
value of the forfeiture at the time it was forfeited (no adjustments
for gains or losses) shall be restored.
H.
Forfeitures. Forfeitures must not be applied to increase
the benefits any municipal employee would otherwise receive under
the plan.
I.
Merger or consolidation. In the case of any merger
or consolidation with, or transfer of plan assets or liabilities to,
any other plan, each plan member would (if the plan then terminated)
receive a benefit immediately after the merger, consolidation, or
transfer which is equal to or greater than the benefit he would have
been entitled to receive immediately before the merger, consolidation,
or transfer (if the plan had then terminated).
J.
Actuarial assumptions. As required by Code Section
401(a)(25), the actuarial assumptions used to calculate plan benefits
shall not be subject to the municipality's discretion.
K.
Optional direct transfer of eligible rollover distributions.
(1)
If any distributee of any eligible rollover distribution:
(a)
Elects to have such distribution paid directly
to an eligible retirement plan; and
(b)
Specifies the eligible retirement plan to which
such distribution is to be paid (in such form and at such time as
the plan administrator may prescribe), such distribution shall be
made in the form of a direct trustee-to-trustee transfer to the eligible
retirement plan so specified.
(3)
Eligible rollover distribution. For purposes of this
subsection, the term "eligible rollover distribution" has the meaning
given such term by Code Section 402(f)(2)(A).
(4)
Eligible retirement plan. For purposes of this subsection,
the term "eligible retirement plan" has the meaning given such term
by Code Section 402(c)(8)(B), except that a qualified trust shall
be considered an eligible retirement plan only if it is a defined
contribution plan, the terms of which permit the acceptance of rollover
distributions.
