As used in this article, the following words or terms shall
have the following meanings:
ANNIVERSARY DATE
The date in each calendar year that coincides with the date
of the commencement of the police employee's employment as a
full-time sworn police officer for the Township, and each anniversary
thereof.
BENEFICIARY
As the case may be, a police officer retired or discharged
from active service with the Township, or the surviving spouse of
a police officer, or the child or children of a police officer, which
person is entitled to benefits under the provisions of this Police
Pension Plan.
CHILD or CHILDREN
The natural or legally adopted son or sons or daughter or
daughters of a police officer, who have not attained the age of 18
years or 23 years if attending college. For the purpose of this definition,
"attending college" shall be defined as being enrolled in an accredited
institution of higher learning and carrying a minimum course load
of seven credit hours per semester. "Child" shall include any unborn
child of a police officer.
CODE
The Internal Revenue Code of 1986, as amended periodically.
COMPENSATION
A.
For police officers whose commencement of employment as a full-time
police officer is before July 1, 2003, the sum of the police officer's
total earnings, compensation and wages, including base annual salary,
payment for overtime, vacation pay, longevity increment pay, K-9 and
special-duty pay, shift differential, holiday pay, educational incentive
bonus, sick pay, on-call pay or any other direct monetary compensation
paid by the Township of Upper Moreland to such police officer for
the performance of services and duties of a police officer, but excluding
reimbursed expenses, nonmonetary compensation, such as fringe benefits
paid by the Township, and other payments made in lieu of expenses.
B.
For police officers whose commencement of employment as a full-time police officer is on or after July 1, 2003, the sum of the police officer's total earnings, compensation and wages, as set forth above in Subsection
A, except that compensation shall not include any lump-sum payments for accrued but unused leave time, including holiday time, which was earned outside of the final 36 months of the police officer's employment included in final average monthly compensation.
C.
"Compensation" for purposes of both Subsections
A and
B above shall include any amount deducted from current salary and any amounts that would be included in wages but for an election under Code Sections 125(a), 132(f)(4), 402(e)(3), 403(b), 414(h)(2) or 457(b).
CPI-U
The Consumer Price Index, Philadelphia Area, All Urban Consumers,
as published by the Department of Labor of the United States for the
applicable period last preceding the application of such CPI-U to
any benefits under this Police Pension Plan.
CREDITED SERVICE
Shall be determined as follows:
A.
Each police officer who is employed by the Township for 1,000
hours or more of compensable time from his or her anniversary date
through the date on which he or she retires or separates from service
shall earn one year of credited service for each calendar year that
he or she is employed as a full-time sworn police officer by the Township.
B.
In addition to the above and as provided in §
45-11C, each police officer may purchase up to five years of service credits upon completing five years or more of credited service as a full-time sworn police officer for the Township. Such "acquired service credits" shall constitute credited service for pension plan purposes only, in strict accord with the intervening and nonintervening military service provisions of the Act of May 29, 1956, P.L. (1955) 1804, Section 4, as amended 52 P.S. § 770. The police officer will be required to pay into the trust fund the actuarial cost to obtain the credited service in the manner provided in accordance with approved actuarial standards.
FINAL AVERAGE MONTHLY COMPENSATION
The sum of the police officer's total compensation which
is earned or payable in the police officer's final 36 months
of service divided by 36.
415 COMPENSATION
A police officer's wages as defined in Code Section
3401(a) for a plan year for which the Township 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 police officer which are not includible in
the gross income of the plan member by reason of either Code Sections
125A, 132(f)(4), 402(e)(3), 402(h)(1)(B), 403(b), 414(h)(2) or 457.
FUND or TRUST FUND
The trust maintained in accordance with the trust agreement
through which the benefits under the Plan are funded.
INJURY
Any wound, damage, impairment or other adverse effect to
or upon the health, physical or mental condition of a police officer.
PLAN ADMINISTRATOR
The duly designated person or entity charged with the administration
of the payment of benefits under the police pension fund.
POLICE CHIEF
The duly appointed Chief of Police of the Township Police
Department appointed to that rank by the Board of Commissioners.
POLICE OFFICER
A duly appointed and sworn police officer employed by the
Township on a full-time basis, as well as the Police Chief, but shall
not include any police officer employed on a part-time basis by the
Township. A "police officer" does not include any non-police officer
employee of the Township such as, without limitation, school crossing
guards, dispatchers, police matrons, animal control officers, the
Township's Service Officer, and secretarial staff.
QUALIFIED MILITARY SERVICE
Any service (either voluntary or involuntary) by a police
officer in the Uniformed Services if such police officer is entitled
to reemployment rights with the Township with respect to such service
under the Uniformed Services Employment and Reemployment Rights Act
of 1994, as amended.
REGULATIONS
The regulations, as amended periodically, adopted by the
Internal Revenue Service with respect to the Code.
RETURNING VETERAN
A former police officer who returns from qualified military
service to employment by the Township within the period of time during
which his reemployment rights are protected by law.
SERVICE-RELATED TOTAL DISABILITY
A total disability suffered by a police officer that was
incurred in the course of, or as a result of, his or her performance
of duty as a police officer. A total disability will be deemed to
be "service-related" if it is compensable under Pennsylvania's
Workers Compensation Act or the Pennsylvania Occupational Disease Act.
SPOUSE
A living person to whom the police officer was legally married
or a living person to whom a retired police officer was legally married
at the time of death of such police officer or retired police officer.
TOTAL DISABILITY
A disability as a result of an injury, disease or condition,
which totally and permanently renders a police officer incapable of
performing the normal duties and functions of a police officer in
the service of the Township.
TOWNSHIP
The Township of Upper Moreland.
TRUST AGREEMENT
The agreement and declaration of trust executed for purposes
of the Plan.
UNIFORMED SERVICES
The Armed Forces of the United States, the Army National
Guard and Air National Guard (when engaged in active duty for training,
inactive duty training, or full-time National Guard duty), the commissioned
corps of the Public Health Service, and any other category of persons
designated by the President of the United States in time of war or
emergency.
Payments made under the provisions of this article shall not
be a charge on any other fund in the treasury of the Township, or
under its control, save the Upper Moreland Municipal Police Pension
Fund herein provided for.
At least annually, any beneficiary, or, in the case of a beneficiary
who is a minor, the guardian of a beneficiary, shall be required to
provide to the Plan Administrator, on a form provided by the Plan
Administrator, a certification of continued eligibility for the payment
of benefits under the plan. Any beneficiary who shall cease to be
eligible for any benefits under the Plan shall inform the Plan Administrator
of such fact and shall refund any payments received for any monthly
period after the first full month following the occurrence of the
event ending eligibility for any benefits under the Plan.
Effective with respect to any police officer with a pension
commencement date on or after January 1, 2003, no offset shall be
made to any form of a pension benefit herein provided for the amount
paid or payable by reason of social security retirement benefits,
or any successor program.
Police officers who have rendered more than 25 years of credited
service shall receive a length of service increment (the "service
increment") of $50 per month for each year of credited service in
excess of 25 years, up to a maximum service increment of $100 per
month.
The Township may employ an actuary at a rate of compensation
to be determined from time to time by the Board of Commissioners.
In addition to such other duties as the actuary may be requested to
perform, the actuary shall determine the amount which shall be contributed
annually to the fund for the service of police officers subsequent
to the establishment of the Plan.
The pension benefits herein provided shall not be subject to
attachment or other legal process and shall be payable only to an
eligible beneficiary and shall not be subject to transfer or assignment.
In the event a police officer or eligible participant qualifies
for more than one form of pension benefit under this article, he or
she will be entitled to elect and be paid the form of pension benefit
that would be payable to him or her, provided that only one form of
pension benefit shall be paid to any beneficiary.
The expenses of administration and management of the fund, including
the compensation of the actuary and the trustees of the fund, may
be paid by the trustees from the fund and to the extent not so payable
shall be paid by the Township of Upper Moreland.
The 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; accordingly, notwithstanding any contrary provisions of this
article, the following provisions shall apply to the Plan.
A. Distribution of benefits.
(1) A plan member's benefits must commence to be paid not later
than April 1st of the calendar year following the later of: the calendar
year in which the Plan member attains age 70 1/2 or the calendar
year in which the Plan member retires. Such distributions must equal
to 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.
(2) 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.
(3) 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.
B. 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 Township, 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) Special limitation for qualified police or firefighters. For any
Plan member who is a "qualified participant," as defined under Code
Section 415(b)(2)(H), the limitation under Code Section 415(b)(2)(C)
shall not be reduced to an amount less than $50,000 [as adjusted per
Code Section 415(d)] as required by Code Section 415(b)(2)(G).
(4) Order of defined benefit plan reductions. If the Plan member participates
or participated in any other defined benefit plan of the Township,
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.
C. 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 or her normal retirement
date under the Plan.
(3) Notwithstanding the Plan's vesting schedule, a Plan member shall
be 100% vested in his or her accrued benefit (to the extent funded)
as of the date of partial or complete Plan termination.
D. Qualified domestic relations order. Notwithstanding the provisions of §
45-21, the Plan shall recognize any domestic relations order which is determined by the Township to be a qualified domestic relations order (QDRO) within the meaning of Code Section 414(p) with respect to a Plan benefit due to a living plan member. The Plan shall not recognize as a QDRO any domestic relations order that assigns any portion of a survivor benefit with respect to a deceased Plan member. To the extent applicable in accordance with this subsection, 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.
E. Alienation. Except for a QDRO as permitted in Subsection
D above, no Plan member or beneficiary shall have the power to subject any benefit or benefits under the Plan 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 Subsection
D above and those referenced in Code Sections 401(a)(13)(C) and (D).
F. Plan member or beneficiary who cannot be located. 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 normal retirement
age and such benefit remains unpaid solely by reason that the Township,
after sending a registered letter, return receipt requested, to the
last known address of such Plan member and after the exercise of due
diligence, cannot 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, such 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.
G. Forfeitures. Forfeitures shall not be applied to increase the benefits
any Plan member would otherwise receive under the Plan.
H. Actuarial assumptions. As required by Code Section 401(a)(25), the
actuarial assumptions used to calculate benefits under the Plan shall
not be subject to the Township's discretion.
I. Optional direct transfer of eligible rollover distributions.
(1) Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a distributee's election under this section,
a distributee may elect, at the time and in the manner prescribed
by the Plan Administrator, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement plan specified
by the distributee in a direct rollover.
(2) For the purposes of this section, the following definitions shall
apply:
DIRECT ROLLOVER
A payment by the Plan to the eligible retirement plan specified
by the distributee.
DISTRIBUTEE
Includes a police officer or former police officer. In addition,
the police officer's or former police officer's surviving
spouse or nonspouse beneficiary are distributees with regard to the
interest of the spouse, former spouse or nonspouse beneficiary.
ELIGIBLE RETIREMENT PLAN
An individual retirement account described in Code Section
408(a), an individual retirement annuity described in Code Section
408(b), an annuity plan described in Code Section 403(a), an annuity
contract described in Code Section 403(b), a qualified retirement
plan described in Code Section 401(a), or an eligible plan under Code
Section 457(b) which is maintained by a state, political subdivision
of a state, or any agency or instrumentality of a state or political
subdivision of a state provided that such plan or annuity accepts
the distributee's eligible rollover distribution. Effective January
1, 2010, an eligible retirement plan shall also include a Roth individual
retirement plan described in Code Section 408A(b). Notwithstanding
the foregoing, in the case of an eligible rollover distribution to
a distributee who is a nonpouse beneficiary, an eligible retirement
plan is limited to an individual retirement account, an individual
retirement annuity, or a Roth individual retirement account that is
established on behalf of such beneficiary and is treated as an inherited
IRA pursuant to Code Section 402(c)(11).
ELIGIBLE ROLLOVER DISTRIBUTION
Any distribution of all or any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not include: any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee's designated beneficiary, or for any specified period of 10 years or more; and any distribution to the extent that such distribution is required under §
45-25A hereof and the portion of any distribution that is not includible in gross income (determined without regard to the exclusion for net unrealized appreciation with respect to employer securities), provided that a portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after-tax employee contributions which are not includible in gross income. However, such portion may be paid only to an individual retirement account described in Code Section 408(a) or an individual retirement annuity described in Code Section 408(b), or to a qualified defined contribution plan described in Code Section 401(a) or Code Section 403(a) that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible.
Any dispute or controversy by a police officer concerning his
or her pension benefit, any claim or eligibility for benefits or concerning
the police officer's pension contribution rate will be submitted
for resolution under and pursuant to the grievance and arbitration
procedure. However, it is agreed that the time constraints for the
filing and processing of any grievance set forth in the grievance
and arbitration procedure are waived.
Except to the extent superseded by federal law, all questions
pertaining to the validity, construction, and operation of the Plan
shall be determined in accordance with the laws of the Commonwealth
of Pennsylvania.
If the Plan Administrator deems any beneficiary who is entitled
to receive payments hereunder incapable of receiving or disbursing
the same by reason of age, illness, infirmity, or incapacity of any
kind, the Plan Administrator may direct the trustees to apply such
payments directly for the comfort, support, and maintenance of such
beneficiary, or to pay the same to any responsible person caring for
the beneficiary who is determined by the administrator to be qualified
to receive and disburse such payments for the beneficiary's benefit,
and the receipt of such person shall be a complete acquittance for
the payment of the benefit. Payments pursuant to this section shall
be complete discharge to the extent thereof of any and all liability
of the Township, the Plan Administrator, the trustees, and the fund.
The Plan Administrator and the trustees shall have the right
to withhold any and all state, local, and federal taxes which may
be withheld in accordance with applicable law.