[Ord. 1925, 2/2/2009; amended 12/6/2010 by Ord. 1956; 11/19/2012
by Ord. 2004]
This amended and restated plan, executed on the date indicated
at the end hereof, is made effective as of January 1, 2008, except
as provided otherwise in § 1-1202.d(2), by Borough of State
College, a governmental agency of the Commonwealth of Pennsylvania.
This General Government Pension Plan shall not apply to individuals
hired full time by the Borough of State College on or after January
1, 2011, who shall be eligible to participate in a 401 Governmental
Money Purchase Plan. The applicable terms of the 401 Governmental
Money Purchase Plan are contained in separate documents, including
but not limited to an Administrative Services Agreement, 401 Governmental
Money Purchase Plan and Trust Basic Documents and any amendments thereto,
as well as any related Ordinances or Resolutions.{775}
The General Government Pension Plan shall not apply to individuals
hired by the Centre Region Council of Governments on or after February
1, 2013, who shall be eligible to participate in a 401 Governmental
Money Purchase Plan. The applicable terms of the 401 Governmental
Money Purchase Plan are contained in separate documents, including
but not limited to an Administrative Services Agreement, 401 Governmental
Money Purchase Plan and Trust Basic Documents and any amendments thereto,
as well as any related Ordinances or Resolutions.
[Ord. 1925, 2/2/2009; amended 12/6/2010 by Ord. 1956; 11/19/2012
by Ord. 2004]
a.
References.
(1)
ACT
205 — The Municipal Pension Plan Funding Standard and Recovery
Act, act of December 18, 1984, P.L. 1005, No. 205, as amended, 53
P.S. § 895.101 et seq. as enacted by the Commonwealth of
Pennsylvania.
(2)
ERISA
— The Employee Retirement Income Security Act of 1974, as amended.
(3)
IRC
— The Internal Revenue Code of 1986, as it may be amended from
time to time.
b.
Actuarial Equivalent.
(1)
The present value of any benefit under the terms of this plan
will be the actuarial equivalent of the accrued benefit in the normal
form of benefit commencing at the participant's normal retirement
date.
(2)
To the extent that the Plan provides for a late retirement benefit,
an early retirement benefit, or optional forms of benefit payment,
the actuarial equivalent of the accrued benefit paid in the normal
form commencing at the normal retirement date shall be determined
as set forth below.
(a)
(Reserved)
(b)
The Early Retirement Benefit as described in § 1204.e
is the accrued benefit adjusted by the early retirement factors set
forth in Appendix E.[1] In the event no factor is specified for the participant's
age at which benefits are to commence, actuarial equivalence for the
early retirement benefit shall be determined by adjusting the earliest
retirement factor set forth in Appendix E using the following mortality
and interest assumptions:
Mortality table: GA 1983 Table
Interest rate: 8.000%
The lump sum pension payment option shall be equal to the present
value of the normal retirement benefit.
[1]
Editor's Note: Appendix E, Actuarial Equivalence Factors for Early Retirement, is included as an attachment to this chapter.
(c)
The Monthly Pension Payment Options shall be determined by multiplying
the amount of the normal form monthly pension by the factors set forth
in Appendix O.[2] In the event no factor is specified for the difference
between the age of the participant and the age of his designated second
annuitant under a joint and survivor annuity, actuarial equivalence
for the monthly pension payment option shall be determined based on
the following mortality and interest assumptions:
Mortality table: GA 1983 Table
Interest rate: 8.000%
[2]
Editor's Note: Appendix O, Actuarial Equivalence Factors for Monthly Pension Options, is included as an attachment to this chapter.
(d)
The Lump Sum Pension Payment Option shall be determined based
on the following mortality and interest assumptions:
Mortality table: GA 1983 Table
Interest rate: 8.000%
(3)
Limitations on Benefits. For the purpose of implementing the
limitations on benefits of IRC Section 415, actuarial equivalence
shall be determined based on the following mortality and interest
assumptions:
Mortality table: UP1984 Table
Interest rate: 5.00% per annum compounded annually
For the purpose of applying the limitations on benefits of § 1-1208.a,
the applicable mortality table is the applicable mortality table described
in Treasury Regulation Section 1.417(e)-1(d)(2) in effect for the
plan year that contains the annuity starting date. The applicable
interest rate is the annual rate of interest as determined under Treasury
Regulation Section 1.417(e)-1(d)(3) for the second month preceding
the first day of the plan year that contains the annuity starting
date.
c.
Compensation/Average Monthly Compensation.
(1)
Compensation definition, exclusions, and calculation.
(a)
Compensation means any earnings reportable as W-2 wages for
federal income tax withholding purposes, plus elective contributions,
for the determination period. For this purpose, the determination
period is the plan year. Picked-up contributions under IRC Section
414(h)(2) shall be included in the participant's compensation. Such
earnings shall include any amount contributed to a Roth elective deferral
account under a qualified plan. However, compensation shall not include
any earnings reportable as W-2 wages that are payable following the
termination of employment pursuant to a severance agreement or paid
in lieu of employer contributions to a deferred compensation plan.
Elective contributions are amounts excludable from the employee's
gross income and contributed by the employer, at the employee's election,
to:
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A cafeteria plan (excludable under IRC Section 125 and as provided
in Section 1208.a(5)(c));
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A tax sheltered annuity (excludable under IRC Section 403(b));
A deferred compensation plan (excludable under IRC Section 457); or
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•
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A IRC Section 132(f)(4) qualified transportation fringe benefit
plan.
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Any reference in this plan to compensation shall be a reference
to the definition in this § 1-1202.c, unless the plan reference
specifies a modification to this definition. The plan administrator
shall take into account only compensation actually paid by the employer
for the relevant period. A compensation payment includes compensation
by the employer through another person under the common paymaster
provisions in IRC sections 3121 and 3306. Compensation from a related
employer that is not a participating employer under this plan shall
be excluded.
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(b)
Exclusions From Compensation. Notwithstanding the provisions
of § 1-1202.c(1)(a), the following types of remuneration
shall be excluded from the participant's compensation:
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Unused vacation, personal days, and sick pay paid on account
of termination of employment.
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Any lump sum payment made upon termination of employment.
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(2)
Limitations on Compensation. For any plan year beginning after
December 31, 2001, the plan administrator shall take into account
only the first $200,000 (or beginning January 1, 2003, as adjusted
for cost-of-living increases in accordance with IRC Section 401(a)(17)(B))
of any participant's annual compensation in determining all benefits
provided under the plan for a determination period. Annual compensation
means compensation during the determination period as defined in Section
1202.c(1). The compensation dollar limitation in effect for a plan
year shall be the limitation amount in effect on January 1 of the
calendar year in which the plan year begins. In determining benefits
in plan years beginning on or after January 1, 2002, the annual compensation
limit for determination periods beginning before January 1, 2002,
shall be $200,000. For any plan year beginning after December 31,
1995, the plan administrator shall take into account only the first
$150,000 (or beginning January 1, 1995, as adjusted for cost-of-living
increases in accordance with IRC Section 401(a)(17)(B)) of any participant's
compensation for determining all benefits provided under the plan
for a determination period. If the plan should determine compensation
on a period of time that contains less than 12 calendar months (such
as for a short plan year), the annual compensation dollar limitation
shall be an amount equal to the otherwise applicable annual compensation
dollar limit for the plan year multiplied by the ratio obtained by
dividing the number of full months in the period by 12.
Notwithstanding the preceding, in the case of an eligible participant,
the annual compensation dollar limitation shall not apply to the extent
that the application of the limitation would reduce the amount of
compensation that is allowed to be taken into account under the plan
below the amount that was allowed to be taken into account under this
plan as in effect on July 1, 1993. For this purpose, an eligible participant
is an individual who first became a participant in the plan during
a plan year prior to the first day of the first plan year beginning
after December 31, 1995.
(3)
Average Monthly Compensation means 1/12 of the average of an
employee's annual compensation over the highest three-consecutive-year
period during the employee's employment with the employer. If an employee's
entire period of service for the employer is less than the specified
period, compensation shall be averaged on an annual basis over the
employee's entire period of service.
The annual compensation taken into account in determining average
annual compensation shall be subject to the compensation dollar limitation
described in § 1-1202.c(2) as in effect for each particular
year.
d.
Dates/Years.
(1)
ACCOUNTING DATE — The last day of the plan year.
(2)
EFFECTIVE DATE OF THE PLAN — November 1, 1955.
The effective date of this amendment and restatement is January
1, 2008; provided, however that the plan provisions required to comply
with the Tax Reform Act of 1986 (TRA '86), the Omnibus Budget Reconciliation
Act of 1986 (OBRA '86), the Omnibus Budget Reconciliation Act of 1987
(OBRA '87), and the Technical and Miscellaneous Revenue Act of 1988
(TAMRA) shall generally be effective on the first day of the plan
year beginning after December 31, 1988, except as specified otherwise
in this plan or in TRA '86, OBRA '86, OBRA '87 or TAMRA for a government
sponsored plan. The plan provisions required to comply with the 1989
Revenue Reconciliation Act shall generally be effective on the first
day of the plan year beginning after December 31, 1989, except as
specified otherwise in this plan or in said Act. The plan provisions
required to comply with the Unemployment Compensation Amendments of
1992 shall be effective on January 1, 1993, except as specified otherwise
for a government sponsored plan. The plan provisions required to comply
with the Omnibus Budget Reconciliation Act of 1993 shall generally
be effective on the first day of the plan year beginning after December
31, 1993, except as specified otherwise in said Act.
The plan provision required to comply with the Family and Medical
Leave Act shall be effective August 5, 1993, the plan provisions required
to comply with the Uniformed Services Employment and Re-Employment
Rights Act of 1994 shall be effective December 12, 1994, the plan
provisions required to comply with the Retirement Protection Act of
1994 shall generally be effective on the first day of the first limitation
year beginning after December 31, 1994, the plan provisions required
to comply with the Small Business Job Protection Act of 1996 shall
generally be effective on the first day of the plan year beginning
after December 31, 1996, the plan provisions required to comply with
the Taxpayer Relief Act of 1997 shall generally be effective on the
first day of the plan year beginning after August 5, 1997, the plan
provisions required to comply with the Economic Growth and Tax Relief
Reconciliation Act of 2001 shall generally be effective on the first
day of the plan year beginning after December 31, 2001, the plan provisions
required to comply with the Pension Funding Equity Act of 2004 (PFEA)
shall be effective for distributions made during the plan year beginning
on or after January 1, 2004 and the plan year beginning on or after
January 1, 2005, and the plan provisions required to comply with the
Pension Protection Act of 2006 that are effective prior to the first
day of the first plan year beginning on or after January 1, 2008 shall
be effective as of the first day of the first plan year beginning
on or after January 1, 2006, except as specified otherwise in this
plan or in said Acts for a government sponsored plan.
(3)
PLAN ENTRY DATE — The participation date(s) specified
in § 1-1203.
(4)
PLAN YEAR — The twelve-consecutive-month period beginning
on January 1 and ending on December 31.
(5)
LIMITATION YEAR — The plan year.
e.
Employee.
(1)
EMPLOYEE — Any person employed by the employer who is
customarily employed for at least 40 hours per week throughout the
year. The term employee shall include any employee of the employer
maintaining the plan or of any other employer required to be aggregated
with such employer under IRC sections 414(b), (c), (m) or (o), as
such provisions may be interpreted to apply to a governmental entity
by the Internal Revenue Service. The term employee shall also include
any leased employee deemed to be an employee of any such employer
as provided in IRC sections 414(n) or (o) and as defined in § 1-1202.e(2).
As set forth in § 1-1201, an Employee hired full-time on
or after January 1, 2011, shall be eligible to participate in the
401 Governmental Purchase Plan established by the Borough of State
College and shall not be eligible to participate in the General Government
Pension Plan.
Notwithstanding the above, for purposes of this Plan, employees
of the Centre Region Council of Governments shall be considered to
be employees of the employer. As set forth in § 1-1201,
an employee, hired full-time by the Centre Region Council of Governments
on or after February 1, 2013, shall be eligible to participate in
the 401 Governmental Money Purchase Plan established by the Borough
of State College and shall not be eligible to participate in the General
Government Pension Plan.
(2)
LEASED EMPLOYEE — An individual (who otherwise is not
an employee of the employer) who, pursuant to a leasing agreement
between the employer and any other person, has performed services
for the employer (or for the employer and any persons related to the
employer within the meaning of IRC Section 414(n)(6)) on a substantially
full time basis for at least one year and such services are performed
under the primary direction or control of the employer. If a leased
employee is treated as an employee by reason of this § 1-1202.e(2),
compensation from the leasing organization that is attributable to
services performed for the employer shall be considered as compensation
under the plan. Contributions or benefits provided a leased employee
by the leasing organization that are attributable to services performed
for the employer shall be treated as provided by the employer.
f.
EMPLOYER
Employer.
Borough of State College, a political subdivision of the
Commonwealth of Pennsylvania (or agency or authority thereof), or
any successor entity that may assume the obligations of this plan
with respect to its employees by becoming a party to this plan.
g.
Fiduciaries.
(1)
CHIEF ADMINISTRATIVE OFFICER — The person appointed by
the employer or the pension board as described in § 1-1209.b
who has primary responsibility for the execution of the administrative
affairs of the plan.
(2)
PLAN ADMINISTRATOR — The Chief Administrative Officer.
(3)
INVESTMENT MANAGER — A person or corporation other than
a trustee appointed for the investment of plan assets.
h.
Participant/Beneficiary/Spouse.
(1)
PARTICIPANT — An eligible employee of the employer who
becomes a member of the plan pursuant to the provisions of § 1-1203,
or a former employee who has an accrued benefit under the plan.
(2)
BENEFICIARY — A person designated by a participant who
is or may become entitled to a benefit under the plan. The beneficiary
may be someone other than the participant's spouse, but only to the
extent that this plan provides for a benefit to be payable to a non-spouse
beneficiary. A beneficiary who becomes entitled to a benefit under
the plan remains a beneficiary under the plan until the trustee has
fully distributed his benefit to him. A beneficiary's right to (and
the plan administrator's, or a trustee's duty to provide to the beneficiary)
information or data concerning the plan shall not arise until he first
becomes entitled to receive a benefit under the plan.
(3)
SPOUSE — The person married to the participant at the
time of the determination as evidenced by a marriage license valid
under the laws of the place of issuance.
i.
PLAN
Plan.
Borough of State College General Government Employees Pension
Plan as set forth herein and as it may be amended from time to time.
j.
Service.
(1)
SERVICE — Any period of time the employee is in the employ
of the employer, including any period the employee is absent due to
vacation, holidays, or sickness. Separation from service means that
the employee no longer has an employment relationship with the employer.
(2)
HOUR OF SERVICE — Each hour for which an employee is paid
or entitled to payment for the performance of duties for the employer.
(3)
BREAK IN SERVICE — Any period of severance.
(4)
PERIOD OF SEVERANCE — A continuous period of time during
which the employee is not employed by the employer and is not credited
with an hour of service. Such period begins on the date the employee
retires, terminates service, or if earlier, the date on which the
employee was otherwise first absent from service.
(5)
CREDIT FOR MILITARY SERVICE — Any employee who entered
into the military service of the United States before employment with
the employer shall receive credit for each year of military service
or fraction thereof for a period not to exceed four years. Such service
shall not be credited if the employee fails to make the required payment.
The required payment for such crediting shall be computed by: (a)
multiplying 10% by the employee's average annual rate of compensation
over the first three years of service and (b) multiplying the result
by the number of years and fractional parts of years of creditable
nonintervening military service being purchased together with interest
at the rate of 4.75% compounded annually from the date of employment
to the date of payment.
No service shall be credited under this § 1-1202.j(5)
if the employee is entitled to receive retirement benefits for such
service under a retirement system administered and wholly or partially
paid for by any other governmental agency with the exception of an
employee eligible to receive military retirement pay earned by a combination
of active duty and nonactive duty with a reserve or national guard
component of the armed forces which retirement pay is payable only
upon attainment of a specified age and period of service under 10
U.S.C. Ch 67 (relating to retired pay for non-regular service).
Notwithstanding the preceding, effective December 12, 1994,
contributions, benefits, and service credit with respect to qualified
military service will be provided in accordance with IRC Section 414(u)
and the applicable Pennsylvania statutes. An employee reemployed after
qualified military service shall not be treated as having incurred
a break in service, for purposes of vesting and benefit accruals,
solely because of an absence due to qualified military service.
Effective with respect to deaths occurring on or after January
1, 2007, in the case of a participant who dies while performing qualified
military service, the beneficiary(ies) of the participant shall be
entitled to any benefits payable under § 1-1205.a that would
have been payable had the participant resumed and then terminated
employment on account of death. Years of vesting service shall be
credited under this provision for purposes of determining the amount
of any death benefit payable.
(6)
OTHER SERVICE CREDITED — If the employer is a member of
an affiliated service group under IRC Section 414(m) or a controlled
group of corporations under IRC Section 414(b), or any other entity
required to be aggregated with the employer pursuant to IRC Section
414(o) as these Internal Revenue Code provisions are applied to a
governmental entity, service shall be credited for any employment
for any period of time for any other member of such group. Service
shall also be credited for any leased employee who is considered an
employee for purposes of this plan under IRC Section 414(n) or (o).
(7)
Years of Service.
(a)
YEAR OF SERVICE — 12 months of service, excluding any
breaks in service. For purposes of determining an employee's initial
year of service upon his employment, the initial year of service shall
commence on the employee's first day of employment. The first day
of employment is the first day the employee performs an hour of service.
The first day of reemployment is the first day the employee performs
an hour of service following a break in service. An initial year of
service shall end on the day immediately preceding the first anniversary
of the employee's date of hire or rehire. Any subsequent year of service
shall commence on the day following the completion of the immediately
preceding year of service.
(b)
CREDITING YEARS OF SERVICE — Service may be credited for
the purpose of eligibility to participate, vesting, benefit accrual,
or determining the benefit payable under the normal retirement benefit
formula. Generally, no service shall be credited for periods during
which the employee performs no services for the employer. Further,
no more than one year of service will be credited for any twelve-consecutive-month
period.
(c)
PREDECESSOR SERVICE — If the employer maintains the plan
of a predecessor employer, service with such predecessor employer
shall be treated as service for the employer. If the employer does
not maintain the plan of a predecessor employer, then service as an
employee of a predecessor employer shall not be considered as service
under the plan, unless this plan is so amended.
k.
Trust.
(1)
TRUST — The qualified trust created under the employer's
plan. The trust shall be known as the Borough of State College General
Government Employees Pension Fund.
(2)
TRUSTEE — The person or persons appointed by the employer
to be the trustee of the trust, or any duly appointed successor trustee.
[Ord. 1925, 2/2/2009; amended 12/6/2011 by Ord. 1956; 11/19/2012
by Ord. 2004]
a.
Eligibility Service. For purposes of determining an employee's initial
or continued eligibility to participate in the plan, an employee shall
receive credit for the aggregate of all time periods commencing with
the employee's first day of employment or re-employment and ending
on the date a break in service begins, except for periods of service
disregarded under Section 2.4. The first day of employment or re-employment
is the first day the employee performs an hour of service. Fractional
periods of a year will be expressed in terms of days.
b.
Plan Participation.
(1)
Eligibility. An employee who is a member of the eligible class
of employees shall be eligible for plan participation provided that
he agrees to make the mandatory contributions as set forth in § 1-1207.b.
(2)
Eligible Class of Employees. All employees of the employer shall
be eligible to be covered under the plan except for employees in the
following category(ies):
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Individuals not directly employed by the employer as defined
in § 1-1202.f. An employee of an entity that is not a participating
employer in this plan shall not participate in this plan.
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Employees employed as police officers.
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Individuals who are hired full-time by the Borough of State
College on or after January 1, 2011.
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Notwithstanding the above, for purposes of this Plan, employees
of the Centre Region Council of Governments shall be considered to
be employees of the employer.
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Individuals who are hired full-time by the Centre Region Council
of Governments on or after February 1, 2013.
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(3)
Entry Date. An eligible employee shall participate in the plan
on the first day he performs one hour of service.
c.
Termination of Participation. A participant shall continue to be
an active participant of the plan so long as he is a member of the
eligible class of employees and he does not terminate employment.
He shall become an inactive participant immediately if he ceases to
be a member of the eligible class of employees or terminates employment.
He shall cease participation completely upon the later of his receipt
of a total distribution of his nonforfeitable accrued benefit under
the plan or the forfeiture of the nonvested portion of the accrued
benefit.
d.
Re-Participation.
(1)
If a participant becomes an inactive participant, because he
is no longer a member of the eligible class of employees; such inactive
participant shall become an active participant immediately upon returning
to the eligible class of employees. In the event an employee who is
not a member of an eligible class of employees becomes a member of
an eligible class, such employee shall participate immediately.
(2)
If a participant incurs a break in service, he shall become
an active participant immediately upon returning to employment.
[Ord. 1925, 2/2/2009]
a.
Service Rules.
(1)
(a)
Year of Vesting Service. For purposes of determining the nonforfeitable
interest in the employee's accrued benefit, the employee shall receive
credit for the aggregate of all time periods commencing with the employee's
first day of employment or re-employment and ending on the date a
break in service begins, except for periods of service disregarded
below. The first day of employment or re-employment is the first day
the employee performs an hour of service. One year of vesting service
shall be credited for each three-hundred-sixty-five-day period. Fractional
periods of a year shall be expressed in terms of days.
(b)
Break in Service Rules.
(i)
Vested Participant. A former employee who had a nonforfeitable
right to all or a portion of his accrued benefit derived from employer
contributions at the time of his termination from service shall retain
credit for all years of vesting service prior to a break in service.
(ii)
Nonvested Participant or Employee. In the case
of a former participant or employee who did not have any nonforfeitable
right to his accrued benefit derived from employer contributions at
the time of his termination from service, such employee shall retain
credit for all years of vesting service prior to a break in service.
(2)
Year of Benefit Service. For the purpose of determining the
employee's benefit under the pension benefit formula, the employee
shall receive credit for the aggregate of all time periods commencing
with the employee's first day of employment or re-employment and ending
on the date a break in service begins or the employee is no longer
a member of an eligible class of employees, except for periods of
service disregarded below. One year of benefit service shall be credited
for each three-hundred-sixty-five-day period. Fractional periods of
a year shall be expressed in terms of days.
For purposes of determining years of benefit service, the determination
shall exclude:
Years of service disregarded under Section 1206.c Cashout Distributions
and Restoration.
b.
Normal Retirement.
(1)
Normal Retirement Age and Date.
(a)
Normal Retirement Age. The normal retirement age of each participant
shall be the day on which he attains age 62.
An actively employed participant's right to his normal retirement
benefit shall be 100% vested and nonforfeitable upon attainment of
the normal retirement age, notwithstanding the plan's vesting schedule.
(b)
Normal Retirement Date. The normal retirement date of each participant
shall be the first day of the month coincident with or next following
the day on which he attains his normal retirement age as defined in
§ 1-1204.b(1)(a).
(2)
Normal Retirement Benefit and Form of Payment.
(a)
Normal Retirement Benefit. The normal retirement benefit of
each participant shall not be less than the largest periodic benefit
that would have been payable to the participant upon separation from
service at or prior to his normal retirement date under the plan exclusive
of social security supplements, premiums on disability or term insurance,
and the value of disability benefits not in excess of the normal retirement
benefit, but taking into account any decrease in average monthly compensation.
For purposes of comparing periodic benefits in the same form, commencing
prior to and at his normal retirement date, the greater benefit shall
be determined by converting the benefit payable prior to his normal
retirement date into the same form of annuity benefit payable at his
normal retirement date and comparing the amount of such annuity payments.
(b)
Normal Form of Payment. The normal form of retirement benefit
for each participant shall be a level monthly pension payable during
the participant's lifetime, with payments commencing on his normal
retirement date, and ceasing upon the later of:
(3)
Pension Benefit Formula. Unless specifically stated otherwise
hereunder, a participant's benefit shall be determined under the pension
benefit formula in effect as of the date he is credited with his final
hour of service for the employer or the last date as of which he is
a member of the eligible class of employees, if earlier.
The monthly benefit for a participant as of his normal retirement
age shall equal: 2.00% of average monthly compensation multiplied
by the years of benefit service up to a maximum of 70.00% of average
monthly compensation. No further benefit shall accrue under this formula
once this maximum is satisfied.
(4)
IRC Section 415 Limitation on Benefits. Notwithstanding the
benefits set forth in this section, the annual benefit otherwise payable
to a participant under this plan at any time shall be limited as provided
in § 1-1208.a.
c.
Accrued Benefit. A participant's accrued benefit at any time equals
the amount computed in accordance with the normal retirement pension
formula in § 1-1204.d(3), but based upon his compensation
and years of benefit service to date.
If a participant begins receiving benefits at a time other than
his normal retirement date, the participant's benefit will be determined
in accordance with § 1-1204.e if benefits commence after
his normal retirement date and in accordance with Section 3.5 if benefits
commence before his normal retirement date.
d.
Late Retirement.
(1)
Nonforfeitability. If a participant remains employed after his
normal retirement date, his benefits shall remain 100% vested and
nonforfeitable. Payment of benefits shall not commence until his actual
retirement date.
(2)
Suspension of Benefits Until Payment. Payment of normal retirement
benefits shall be suspended for each calendar month during which the
participant remains employed after his normal retirement date. The
amount of benefits that are paid later than his normal retirement
date shall be computed under the pension benefit formula. The participant's
pension benefit shall be determined on the basis of the participant's
years of service for benefit accrual completed before and during the
period of suspension; and the participant's compensation with the
employer during the period of suspension shall be included in any
relevant determination of average monthly compensation.
e.
Early Retirement. If a participant satisfies the requirements for
early retirement, the participant's accrued benefit shall be 100%
vested and nonforfeitable. Such participant may retire before his
normal retirement date without the consent of the employer and receive
early retirement benefits from the plan. The early retirement date
of each participant shall be the first day of the month coincident
with or next following the day on which he satisfies the early retirement
benefit requirement(s).
In the case of a participant who has attained age 55 and completed
five years of vesting service before his normal retirement date, the
early retirement benefit shall be equal to the actuarial equivalent
(as determined under § 1-1202.b) of the normal retirement
benefit accrued as of his early retirement date. If a participant
separates from service before satisfying the age requirement for this
early retirement provision, but has satisfied the service requirement,
the participant shall be entitled to elect this early retirement benefit
upon satisfaction of such age requirement.
In the case of a participant who has completed 35 years of vesting
service before his normal retirement date, the early retirement benefit
shall be equal to the benefit accrued as of his early retirement date,
without actuarial reduction.
f.
Disability Retirement. If an actively employed participant becomes
disabled prior to his normal retirement date such that he is eligible
for Social Security disability benefits, he may retire under the plan.
A disabled participant's right to his accrued benefit as of his date
of disability shall be 100% vested and nonforfeitable. Such disabled
participant shall be entitled to a monthly pension equal to the benefit
accrued to the date of disability. The participant may elect the form
of payment as described in § 1-1204.g. In the administration
of this section, all employees shall be treated in a uniform manner
in similar circumstances.
g.
Benefit Distribution.
(1)
Commencement of Benefits. Subject to the limitations of this
plan, the benefit distribution shall commence as soon as administratively
feasible after the later of the participant's termination of employment
or his satisfaction of the normal retirement date requirements, provided
that he files a written application for the retirement benefit.
(2)
Optional Forms of Payment. A participant may elect to receive
distribution of his accrued benefit in one of the optional forms of
payment outlined below, provided that such distribution complies with
the Distribution Requirements of § 1-1208.b. The participant
shall file a written request for benefits with the plan administrator
before payments will commence. Optional forms of payment include:
(a)
Lifetime Pension. A monthly pension payable for the lifetime
of the participant with payments guaranteed for the first zero, 60,
120, or 180 months.
(b)
Joint and Survivor Pension. A monthly pension payable as long
as the participant or his designated survivor annuitant live. The
amount of monthly pension continued after the participant's death
during the lifetime of the survivor annuitant may be 100%, 75%, 66 2/3%,
or 50% of the actuarially adjusted amount payable during the participant's
lifetime. The plan administrator shall reject the designation of a
survivor annuitant if the age of such person would cause a monthly
pension to violate the Distribution Requirements of § 1-1208.b(3)(a).
(c)
A Lump Sum Payment. If the present lump sum value of the vested
accrued benefit is no more than $5,000, this shall be the sole payment
option. This form of payment may not be elected if such vested present
value exceeds such dollar amount. Distributions in excess of $1,000
will only be made with the participant's consent. If the distribution
is equal to or less than $1,000, benefits will automatically be paid
in a lump sum. For the purpose of determining the present lump sum
value of the participant's vested accrued benefit, prior distributions
shall be disregarded provided they did not commence under another
optional form of payment. A lump sum benefit payment shall be made
in cash from the fund.
(3)
General Payment Provisions.
(a)
If any person entitled to receive benefits hereunder is physically
or mentally incapable of receiving or acknowledging receipt thereof,
and if a legal representative has been appointed for him, the plan
administrator may direct the benefit payment to be made to such legal
representative.
(b)
At the direction of the plan administrator, the trustee may
make pension payments directly from the fund or may take such steps
as may be required to purchase an annuity contract from an insurance
company for the participant, provided that the annuity contract purchased
on behalf of such participant shall be sufficient to provide the benefits
to which the participant is entitled. The ownership of the annuity
contract shall remain with the trustee, unless the plan administrator
determines otherwise. Any annuity contract distributed herefrom shall
be non-transferable. The application and directions to the insurance
company for such annuity contract shall be made by the plan administrator.
The terms of any such annuity contract purchased by the plan shall
comply with the requirements of this plan. Any dividend, refund, or
recovery on an annuity contract shall be used to reduce subsequent
employer contributions.
(c)
The benefits due any participant on account of his most recent
period of employment shall not duplicate any benefits due the same
participant under this plan on account of previous employment with
the employer.
(d)
The participant's election of a form of benefit payment shall
be irrevocable as of the annuity starting date, subject to the notice
requirements contained in § 1-1204.g(6).
(4)
Eligible Rollover Distribution. Effective for distributions
made on or after January 1, 1993, a distributee may elect, at the
time and in the manner prescribed by the plan administrator, to have
any eligible portion of a lump sum distribution paid directly to an
eligible retirement plan specified by the distributee in a direct
rollover payment.
(a)
Eligible Rollover Distribution. An eligible rollover distribution
is 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 to the extent such distribution
is required under IRC Section 401(a)(9) and the portion of any distribution
that is not includable in gross income; and any other distribution(s)
that is reasonably expected to total less than $200 during a year.
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 includable in gross income. However,
such portion may be transferred only to: (A) an individual retirement
account or annuity described in IRC Section 408(a) or (b); (B) for
taxable years beginning after December 31, 2001 and before January
1, 2007, to a qualified defined contribution plan described in IRC
Section 401(a) or 403(a) that agrees to separately account for amounts
so transferred, including separately accounting for the portion of
such distribution which is includable in gross income and the portion
of such distribution which is not so includable; or (C) for taxable
years beginning after December 31, 2006, to a qualified trust or to
an annuity contract described in IRC Section 403(b), if such trust
or contract provides for separate accounting for amounts so transferred
(including interest thereon), including separately accounting for
the portion of such distribution which is includable in gross income
and the portion of such distribution which is not so includable.
(b)
Eligible Retirement Plan. An eligible retirement plan is an
individual retirement account described in IRC Section 408(a), an
individual retirement annuity described in IRC Section 408(b), an
annuity plan described in IRC Section 403(a), an annuity contract
described in IRC Section 403(b), an eligible plan under IRC Section
457(b) that is maintained by a state, political subdivision of a state,
or any agency or instrumentality of a state or political subdivision
of a state and that agrees to separately account for amounts transferred
into such plan from this plan, or a qualified plan described in IRC
Section 401(a), that accepts the distributee's eligible rollover distribution.
Effective for distributions made on or after January 1, 2008,
an eligible retirement plan includes a Roth individual retirement
account (Roth IRA) described in IRC Section 408A. However, for distributions
before January 1, 2010, a distributee shall not be allowed to make
a qualified rollover contribution to a Roth IRA from the plan if,
for the taxable year of the distribution to which such contribution
relates the distributee's adjusted gross income exceeds $100,000,
or the distributee is a married individual filing a separate return.
(c)
Distributee. A distributee includes an employee or former employee.
In addition, the employee's or former employee's surviving spouse
and the employee's or former employee's spouse or former spouse who
is the alternate payee under a qualified domestic relations order,
as defined in IRC Section 414(p), are distributees with regard to
the interest of the spouse or former spouse. Effective for death benefit
distributions made on or after January 1, 2007, a distributee shall
include a nonspouse beneficiary but only with respect to a direct
transfer to an inherited individual retirement account or annuity
that is established on his behalf and that will be treated as an inherited
individual retirement account or annuity pursuant to the provisions
of IRC Section 402(c)(11).
(d)
Direct Rollover. A direct rollover is a payment by the plan
to the eligible retirement plan specified by the distributee.
(5)
Unclaimed Benefits.
(a)
Forfeiture. The plan does not require the trustee or the plan
administrator to search for, or to ascertain the whereabouts of, any
distributee. At the time the distributee's benefit becomes distributable
under the plan, the plan administrator, by certified or registered
mail addressed to his last known address of record, shall notify any
distributee that he is entitled to a distribution under this plan.
If the distributee fails to claim his distributive share or make his
whereabouts known in writing to the plan administrator within 12 months
from the date of mailing of the notice, the plan administrator shall
treat the distributee's unclaimed payable accrued benefit as forfeited.
A forfeiture under this § 1-1204.g(5) shall occur at the
end of the notice period or, if later, the earliest date applicable
federal Treasury regulations would permit the forfeiture. These forfeiture
provisions apply solely to the distributee's accrued benefit derived
from employer contributions.
(b)
Restoration. If a distributee who has incurred a forfeiture
of his accrued benefit under the provisions of this § 1-1204.g(5)
makes a claim, at any time, for his forfeited accrued benefit; the
plan administrator shall restore the distributee's forfeited accrued
benefit to the present value of the accrued benefit forfeited. The
plan administrator shall make the restoration during the plan year
in which the distributee makes the claim. If necessary, the employer
shall make a contribution to the plan to satisfy the restoration.
The plan administrator shall direct the trustee to distribute the
distributee's restored accrued benefit to him not later than 60 days
after the close of the plan year in which the plan administrator restores
the forfeited accrued benefit.
(6)
Special Rule Relating to Time for Written Explanation. Effective
for distributions made on or after January 1, 1993, for any distribution
in excess of $200 that may be paid in the form of a lump sum, the
plan administrator shall give the participant written notice of his
eligible rollover distribution rights as required under IRC Section
402(f) no less than 30 days and no more than 180 days (90 days for
notices issued before January 1, 2007) before the annuity starting
date with respect to the distribution. Effective for distributions
made on or after January 1, 1994, such distribution may commence less
than 30 days after the notice is given, provided that:
(a)
The participant is provided with information that clearly states
that the participant has a right to a period of at least 30 days after
receiving the written explanation and notice to consider the decision
of whether or not to elect a distribution;
(b)
The participant, after receiving the written notice, affirmatively
elects a distribution.
h.
Suspension of Benefits. Subject to the requirements of § 1-1208.b,
benefits in pay status shall be suspended if a participant returns
to employment in the eligible class of employees. If the participant
accrues an additional benefit, the plan shall offset the actuarial
value of the distributions made to the participant by the last day
of the preceding plan year against the benefit accrual for the current
plan year.
i.
Distributions Under Domestic Relations Orders. Nothing contained
in this plan prevents the trustee, in accordance with the direction
of the plan administrator, from complying with the provisions of an
acceptable domestic relations order that creates or recognizes the
existence of an alternate payee's right to, or assigns to an alternate
payee the right to receive all or a portion of the benefits payable
with respect to a participant under the plan.
A distribution under an acceptable domestic relations order
will not be made to an alternate payee until the participant is entitled
to a distribution under this plan and commences such distribution.
Nothing in this section permits the alternate payee to receive a form
of payment not otherwise permitted under the plan.
The plan administrator shall establish reasonable procedures
to determine the acceptability of a domestic relations order in accordance
with IRC Section 414(p). Upon receiving a domestic relations order,
the plan administrator promptly will notify the participant and any
alternate payee named in the order, in writing, of the receipt of
the order and the plan's procedures for determining the acceptability
of the order. Within a reasonable period of time after receiving the
domestic relations order, the plan administrator shall determine the
acceptability of the order and shall notify the participant and each
alternate payee, in writing, of its determination. The plan administrator
shall provide notice under this paragraph by mailing to the individual's
address specified in the domestic relations order.
If any portion of the participant's nonforfeitable accrued benefit
is payable during the period the plan administrator is making its
determination of the acceptability of the domestic relations order,
the plan administrator shall make a separate accounting of the amounts
payable. If the plan administrator determines the order is an acceptable
domestic relations order within 18 months of the date amounts first
are payable following receipt of the order, it shall direct the trustee
to distribute the payable amounts in accordance with the order. If
the plan administrator does not make its determination of the acceptability
of the order within the eighteen-month determination period, it shall
direct the trustee to distribute the payable amounts in the manner
the plan would distribute if the order did not exist and will apply
the order prospectively if it later determines the order is an acceptable
domestic relations order.
[Ord. 1925, 2/2/2009]
a.
Preretirement Death Benefit. If a participant dies prior to his annuity
date (as defined in § 1-1208.a(5)(1)), a death benefit shall
be payable as follows:
(1)
Preretirement Survivor Annuity Benefit. If a vested participant
who has been married for at least one year dies after the plan's earliest
retirement age, the participant's surviving spouse shall receive the
same benefit that would be payable if the participant had retired
with an immediate joint and 50% survivor annuity on the day before
the participant's date of death.
The surviving spouse may elect to commence payment under such
annuity as of the first day of any month within a reasonable period
after the participant's death, but in no event later than December
1 of the later of: (A) the calendar year containing the participant's
normal retirement date; or (B) the calendar year containing the first
anniversary of the participant's death. The actuarial value of benefits
that commence later than the date on which payments would have been
made to the surviving spouse under a joint and survivor annuity in
accordance with this provision shall be adjusted to reflect the delayed
payment. This adjustment shall be made using the interest rate and
mortality table set forth in § 1-1202.b(2)(c).
If a vested participant who has been married for at least one
year dies on or before the plan's earliest retirement age as described
in § 1-1204.e, the participant's surviving spouse shall
receive the same benefit that would be payable if the participant
had:
•
|
Separated from service on the date of death (or on the date
of separation from service, if earlier),
|
•
|
Been vested strictly in accordance with the vesting schedule,
|
•
|
Survived to the earliest retirement date,
|
•
|
Retired with an immediate joint and 50% survivor annuity at
the earliest retirement date, and
|
•
|
Died on the day after the earliest retirement date.
|
For purposes of the preceding sentence, a surviving spouse shall
begin to receive payments at the participant's earliest retirement
date unless such surviving spouse elects a later date. Benefits commencing
after the earliest retirement date will be the actuarial equivalent
of the benefit to which the surviving spouse would have been entitled
if benefits had commenced at the participant's earliest retirement
date under an immediate joint and 50% survivor annuity using the interest
rate and mortality table set forth in § 1-1202.b(2)(c).
|
In determining this benefit, the employee-provided accrued benefit
is 100% vested. If the surviving spouse dies before the plan has commenced
distribution or before the pension payments made to the surviving
spouse equal the present value of the spouse's portion of the accumulated
contributions as described in § 1-1207.b as of the annuity
starting date, the excess over the payments made shall be payable
to the surviving spouse's estate.
|
The survivor benefit set forth above shall not be payable unless
the participant and spouse have been married throughout the one-year
period ending on the date of the participant's death. The participant's
spouse cannot waive receipt of this benefit to the extent that this
benefit is an employer-provided accrued benefit. To the extent that
this benefit is an employee-provided benefit under Section 1207.b,
the participant may designate another beneficiary in accordance with
the provisions of § 1-1208.b and § 1-1205.a(3).
This benefit shall be paid in one lump sum if the actuarially equivalent
present value of the benefit is equal to $5,000 or less. Distributions
in excess of $1,000 will only be made with the consent of the participant's
spouse before the date a distribution is required under § 1-1208.b.
If the distribution is $1,000 or less, the benefit will automatically
be paid in a lump sum following the distribution election period.
|
If there is an acceptable domestic relations order in force
with respect to the participant, the alternate payee shall be treated
as the surviving spouse to the extent provided in the order. However,
no order shall be accepted if it provides that the alternate payee
shall be the surviving spouse with respect to benefits accrued as
a result of years of benefit service credited after the termination
of the marriage.
|
(2)
Employee Contributions. The participant's accumulated contributions
as described in § 1-1207.b shall be payable under this § 1-1205.a(2)
to the extent not payable under § 1-1205.a(1). In the case
of a participant who dies prior to becoming vested in any employer-provided
accrued benefit or prior to being married for at least one year, such
employee-provided benefit shall be payable to the participant's named
beneficiary.
(3)
Beneficiary Designation. With respect to his accumulated contributions,
the participant shall have the right to designate his beneficiaries,
including a contingent beneficiary, and shall have the right at any
time to change such beneficiaries. The designation shall be made in
writing on a form supplied by the plan administrator. No designation
shall be effective until filed with the plan administrator. If the
participant fails to designate a beneficiary, or if the designated
person or persons predeceases the participant, "beneficiary" shall
mean the spouse, children, parents, brothers and sisters, or estate
of the participant, in the order listed.
For purposes of this § 1-1205.a, if a spouse or beneficiary
of the participant dies simultaneously with the participant, the participant
shall be deemed to be the survivor and to have died subsequent to
such spouse or beneficiary. Likewise, if a beneficiary named by a
designated beneficiary dies simultaneously with a designated beneficiary,
the designated beneficiary shall be deemed to be the survivor and
to have died subsequent to the beneficiary named by the designated
beneficiary.
If a participant completes or has completed a beneficiary designation
form in which the participant designates his spouse as the beneficiary
and the participant and such spouse are legally divorced subsequent
to the date of such designation; then, the designation shall be administered
as if such spouse had predeceased the participant unless the participant,
subsequent to the legal divorce, reaffirms the designation by completing
a new beneficiary designation form.
In the absence of a beneficiary designation form duly filed
with the plan administrator by the designated beneficiary for any
preretirement death benefit, if such designated beneficiary dies before
the plan has commenced distribution of the death benefit to the designated
beneficiary, the death benefit shall be paid to such person's estate
in one lump sum by the date required under § 1-1208.a.
If the deceased designated beneficiary is not the participant's
surviving spouse, distribution shall be completed by the December
31 of the fifth year following the participant's date of death. If
the deceased designated beneficiary is the participant's surviving
spouse, distribution shall be completed by the December 31 of the
fifth year following the beneficiary's date of death.
(4)
Form and Manner of Payment. The accumulated contribution death
benefit payable to the participant's beneficiary shall be payable
in a lump sum.
b.
Postretirement Death Benefit. Upon the death of a participant after
his annuity starting date, no death benefit shall be payable, except
such benefit as is provided by the particular form of pension payment
under which pension benefits are being distributed.
Notwithstanding the preceding, if the total payments received
under the terms of the elected form of pension payment by the participant
and any designated survivor annuitant or beneficiary are less than
the present value of the participant's accumulated contributions as
of the annuity starting date, monthly payments shall be made until
this amount has been distributed.
[Ord. 1925, 2/2/2009]
a.
Vesting.
If a participant separates from the service of the employer other
than by retirement, disability, or death, he shall be entitled to
a vested deferred pension equal to the benefit accrued to the date
of termination multiplied by the vesting percentage, based upon his
years of vesting service to the date of termination. His vesting percentage
shall be determined by the vesting schedule set forth below:
Years of Service
|
Vesting Percentage
|
---|---|
0-4 Years
|
0%
|
5 or More Years
|
100%
|
b.
Payment
of Benefits.
(1)
Payment as of Normal Retirement Date. If the participant terminates
his employment on or before his normal retirement date, payment of
the vested accrued pension may begin at his normal retirement date.
If payments do not commence until after his normal retirement date,
distribution must begin by the required beginning date for minimum
required distributions and the amount of the benefit payable shall
be determined as provided in § 1-1204.d. The vested accrued
pension shall be payable in the same optional forms and in the same
manner as described in § 1-1204.g.
(2)
Payment as of Early Retirement Date. Upon the request of the
terminated participant, payment of the vested accrued pension may
begin after he has satisfied the plan's early retirement date requirement(s).
In the event of such earlier commencement of benefits, the benefit
shall be paid pursuant to the early retirement provisions of § 1-1204.e
in the same optional forms and in the same manner as described in
§ 1-1204.g.
(3)
Payment Prior to Early Retirement Date. Generally, no payment
shall be made prior to retirement, death, or disability. However,
if the present lump sum value of the vested accrued benefit is no
more than $5,000 exclusive of his accumulated employee contributions,
the benefit may be distributed in a lump sum payment after severance
of employment. Distributions in excess of $1,000 shall only be made
with the participant's consent. For these purposes, present value
shall be calculated as specified in § 1-1202.b. Further,
the participant may elect to have paid to him an amount equal to his
accumulated employee contributions as soon as administratively possible
after severance of employment as provided in § 1-1207.b(4).
(4)
Death Before Retirement. If a participant terminates employment
and dies before beginning to receive retirement benefits, a preretirement
death benefit may be payable, to the extent provided under § 1-1205.
(5)
Forfeiture for Malfeasance. Notwithstanding any other provision
of this plan, a 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
Pension Forfeiture Act, 43 P.S. § 1311-1314 and interpreted
thereunder, shall forfeit his right to receive a pension benefit under
this plan. In such a case, the participant shall only be entitled
to receive the contributions, if any, he made under § 1-1207.b,
without interest.
c.
Cashout Distributions and Restoration.
(1)
Cashout Distribution. If an employee terminates service and
receives a distribution of the present value of the entire vested
portion of his accrued benefit, the nonvested portion will be treated
as a forfeiture. For purposes of this section, if the present value
of an employee's vested accrued benefit is zero, he shall be deemed
to have received a distribution of such vested accrued benefit as
of his separation from service.
In determining the participant's accrued benefit after the occurrence
of such a distribution, the plan shall disregard all year of benefit
service performed by such employee before the date of distribution.
In the case of a participant who elects to receive a partial distribution,
the plan shall disregard a portion of his accrued benefit equal to
his total nonforfeitable accrued benefit immediately prior to the
partial distribution multiplied by a fraction, the numerator of which
is the amount of the distribution and the denominator of which is
the present value of his total nonforfeitable accrued benefit immediately
prior to such distribution.
(2)
Restoration. If a participant receives a distribution pursuant
to this section of his accrued benefit and if he resumes covered employment
under the plan; he shall have the right to restore his accrued benefit
under § 1-1204.b upon the repayment to the plan of the full
amount of the distribution plus interest, compounded annually from
the date of distribution at the rate set forth in § 1-1207.b(3).
In order to make a total or partial repayment, the employee may transfer
to the plan the account balance of the individual retirement account
or annuity to which the distribution being repaid was transferred,
provided that the employee has made no other contribution to the account
or annuity and both transfers are accomplished in compliance with
IRC Section 408(d). Such repayment must be made within five years
after the participant returns to active participation.
If a participant is eligible to restore his employer-derived
accrued benefit, but such restoration has not been made; then, the
participant's accrued benefit shall be equal to his total accrued
benefit offset by the accrued benefit attributable to the distribution.
For the purpose of determining years of benefit service, years of
service before the employee's break-in-service shall not be disregarded.
If a nonvested participant is deemed to receive a distribution
pursuant to this section and if he resumes employment covered under
this plan, upon his reemployment, the employer-derived accrued benefit
shall be restored to the amount of such accrued benefit on the date
of the deemed distribution. For the purpose of determining years of
benefit service, years of service before the employee's break-in-service
shall not be disregarded.
(3)
Forfeitures.
[Ord. 1925, 2/2/2009]
a.
Employer Contributions. The Chief Administrative Officer of the plan
shall determine the financial requirements of the plan on the basis
of the most recent actuarial report and shall determine the minimum
obligation of the employer with respect to funding the plan for any
given plan year after taking into account any contribution to be made
by the Commonwealth of Pennsylvania and any participant contributions.
The Chief Administrative Officer shall submit the financial requirements
of the plan and the minimum obligation of the employer to the employer
(or its governing body) annually and shall certify the accuracy of
such calculations and their conformance with Act 205. The employer
shall be obligated to make such contribution to the trust by annual
appropriations.
b.
Mandatory Employee Contributions.
(1)
Mandatory Contribution Amount. As a condition of participation
in this plan, each active participant must contribute up to 4.00%
of his compensation each year on an after-tax basis. Such rate of
contribution shall be determined annually by the governing body of
the employer.
(2)
Effective January 1, 1999, the employer shall contribute an
amount equal to the mandatory employee contribution amount set forth
in § 1-1207.b(1) as a pick-up contribution (pursuant to
IRC Section 414(h)(2)) in lieu of the prior mandatory employee contribution.
The contribution shall be made on a pre-tax basis, and there shall
be a corresponding reduction in compensation paid to the participant.
(3)
Determination of Accrued Benefit. The accrued benefit derived
from a participant's mandatory employee contributions as of any applicable
date is an annual benefit, in the form of a life annuity with a one-hundred-twenty-month
guaranteed period (without ancillary benefits) commencing at his normal
retirement date, equal to the actuarial equivalent of the participant's
accumulated contributions. The participant's accumulated contributions
shall be equal to his mandatory employee contributions with interest.
The interest rate to be credited shall be 5.000% per annum. Such interest
shall be credited annually in the form of a compound interest rate.
A participant shall be 100% vested in his accumulated contributions.
If this plan or a prior plan is or has been amended so as to
no longer require employee mandatory contributions, the participant's
employee-provided accrued benefit and employer-provided accrued benefit
shall be determined as if the plan required contributions of the employee
as a condition of participation at the time of termination of employment.
This section, however, shall not apply to the extent the contributions
the participant has made to the plan (or prior plan) have been refunded
to him.
(4)
Withdrawal of Accumulated Contributions. Employee contributions
shall generally be payable at the same time and under the same conditions
as provided for the payment of the employer-provided accrued benefits.
Notwithstanding the above, upon separation from service, a participant
may withdraw an amount that is no more than an amount equal to his
total accumulated contributions.
In no event may an amount in excess of such accumulated contributions
be withdrawn or distributed until the participant's retirement, disability,
death or termination of employment, regardless of the income tax accounting
treatment required by IRC Section 72(e)(8)(D). If the total accumulated
employee contributions are paid to the participant upon retirement,
disability, or termination of employment, his accrued benefit shall
be reduced to an amount equal to the employer-provided accrued benefit.
If the present lump sum value of the remaining employer-provided
accrued benefit is $5,000 or less, the participant may also elect
payment of the employer-provided accrued benefit.
(5)
Forfeiture. A participant's accrued benefit derived from mandatory
employee contributions shall be nonforfeitable at all times. No forfeitures
shall occur solely as a result of a participant's withdrawal of employee
contributions. The death benefit payable under § 1-1205
shall not be less than the participant's accumulated contributions.
c.
Rollover/Transfer Contributions. Rollover and transfer contributions
shall not be permitted under this plan and there shall be no rollover/transfer
account.
[Ord. 1925, 2/2/2009]
a.
Limitation on Benefits Under IRC Section 415. The limitations of
this § 1-1208.a shall apply in limitation years beginning
on or after July 1, 2007, except as otherwise provided herein.
(1)
Annual Benefit Limitation. The annual benefit otherwise payable
to a participant at any time under the plan shall not exceed the maximum
permissible benefit.
(2)
Limitations on Employee Contributions. If a participant has
made mandatory employee contributions, under the terms of this plan,
the amount of such contributions shall be treated as an annual addition
to a qualified defined contribution plan.
(a)
If the mandatory employee contribution the participant would
otherwise make in a limitation year would exceed the maximum permissible
annual addition, the contribution shall be limited to a contribution
that does not exceed the maximum permissible annual addition.
(i)
Prior to determining the participant's actual compensation for
the limitation year, the employer may determine the maximum permissible
annual addition for a participant on the basis of a reasonable estimation
of the participant's compensation for the limitation year, uniformly
determined for all participants similarly situated.
(ii)
As soon as is administratively feasible after
the end of the limitation year, the maximum permissible annual addition
for the limitation year will be determined on the basis of the participant's
actual compensation for the limitation year.
(b)
In any limitation year in which the employee contributions otherwise
contributable under this plan would exceed the maximum permissible
annual addition because of contributions otherwise allocable under
a defined contribution plan that the employer also sponsors, the contribution
under such plan(s) shall be limited to a contribution that does not
exceed the maximum permissible annual addition reduced by the mandatory
employee contribution required under this plan.
(3)
Combined Limitations: Other Defined Benefit Plans.
(a)
If a participant is, or has ever been, a participant in another
qualified defined benefit plan maintained by the employer or a predecessor
employer, the sum of the participant's annual benefits from all such
plans may not exceed the maximum permissible benefit. If the maximum
permissible benefit is exceeded solely due to the benefit payable
under a frozen or terminated defined benefit plan, the annual benefit
otherwise payable under this plan shall be reduced so that the maximum
permissible benefit is not exceeded.
(b)
Where the participant's employer-provided benefits under all
qualified defined benefit plans ever maintained by the employer (determined
as of the same age) would exceed the maximum permissible benefit applicable
at that age, the method by which the plans will limit a participant's
annual benefit otherwise payable in such cases shall be as provided
in § 1-1204.b(6).
(4)
Protection of Accrued Benefit. In the case of an individual
who was a participant in one or more defined benefit plans of the
employer as of the first day of the first limitation year beginning
after December 31, 1986, the application of the limitations of IRC
Section 415 shall not cause the maximum permissible benefit amount
for such individual under all such defined benefit plans to be less
than the individual's Tax Reform Act of 1986 (TRA '86) accrued benefit.
The preceding sentence applies only if all such defined benefit plans
met the requirements of IRC Section 415, for all limitation years
beginning before January 1, 1987.
The application of the provisions of this § 1-1208.a
shall not cause the maximum permissible benefit for any participant
to be less than the participant's accrued benefit under all the defined
benefit plans of the employer or a predecessor employer as of the
end of the last limitation year beginning before July 1, 2007 under
provisions of the plans that were both adopted and in effect before
April 5, 2007. The preceding sentence applies only if the provisions
of such defined benefit plans that were both adopted and in effect
before April 5, 2007 satisfied the applicable requirements of statutory
provisions, regulations, and other published guidance relating to
IRC Section 415 in effect as of the end of the last limitation year
beginning before July 1, 2007, as described in Treasury Regulation
Section 1.415(a)-1(g)(4).
(5)
Definitions (IRC Section 415 Limitations)
(a)
Annual Additions. The sum of the following amounts credited
to a participant's account for the limitation year: (A) employer contributions;
(B) employee contributions; (C) forfeitures; (D) allocations under
a simplified employee pension; and (E) amounts allocated, after March
31, 1984, to an individual medical account that is part of a pension
or annuity plan maintained by the employer. Also amounts derived from
contributions paid or accrued after December 31, 1985 (in taxable
years ending after such date), that are attributable to post-retirement
medical benefits, allocated to the separate account of a key employee
(as defined in IRC Section 419A(d)(3)) under a welfare benefit fund.
For limitation years beginning before January 1, 1987, employee
contributions shall only be taken into account for this purpose up
to the lesser of the amount of employee contributions in excess of
6% of compensation for the limitation year, or one-half of the employee
contributions for that year. Picked-up contributions under IRC Section
414(h)(2) shall not be included as an annual addition with respect
to a participant.
(b)
Annual Benefit. A benefit
under the plan that is payable annually in the form of a straight
life annuity. The annual benefit shall include any picked-up contributions
made by the employer under IRC Section 414(h)(2). Except as provided
below, where a benefit is payable in a form other than a straight
life annuity, the benefit shall be adjusted to an actuarially equivalent
straight life annuity that begins at the same time as such other form
of benefit and is payable on the first day of each month, before applying
the limitations of this section 1208.a. For a participant who has
or will have distributions commencing at more than one annuity starting
date, the annual benefit shall be determined as of each such annuity
starting date (and shall satisfy the limitations of this section 1208.a
as of each such date), actuarially adjusting for past and future distributions
of benefits commencing at the other annuity starting dates. For this
purpose, the determination of whether a new starting date has occurred
shall be made without regard to Treasury Regulation Section 1.401(a)-20,
Q&A 10(d), and with regard to Treasury Regulation Section 1.415(b)-1(b)(1)(iii)(B)
and (C).
No actuarial adjustment to the benefit is required for (A) survivor
benefits payable to a surviving spouse under a qualified joint and
survivor annuity to the extent such benefits would not be payable
if the participant's benefit were paid in another form; (B) benefits
that are not directly related to retirement benefits (such as a qualified
disability benefit, preretirement incidental death benefits, and postretirement
medical benefits); and (C) the inclusion in the form of benefit of
an automatic benefit increase feature, provided the form of benefit
is not subject to IRC Section 417(e)(3) and would otherwise satisfy
the limitations of this section 1208.a, and the plan provides that
the amount payable under the form of benefit in any limitation year
shall not exceed the limits of this section 1208.a applicable at the
annuity starting date, as increased in subsequent years pursuant to
IRC Section 415(d). For this purpose, an automatic benefit increase
feature is included in a form of benefit if the form of benefit provides
for automatic, periodic increases to the benefits paid in that form.
The determination of the annual benefit shall take into account
social security supplements described in IRC Section 411(a)(9) and
benefits transferred from another defined benefit plan, other than
transfers of distributable benefits pursuant Treasury Regulation Section
1.411(d)-4, Q&A-3(c), but shall disregard benefits attributable
to employee contributions or rollover contributions.
Effective for distributions in plan years beginning after December
31, 2003, the determination of actuarial equivalence of forms of benefit
other than a straight life annuity shall be made in accordance with
§ 1-1208.a(5)(b)(i) or § 1-1208.a(5)(b)(ii).
(i)
Benefit Forms Not Subject to IRC Section 417(e)(3). The straight
life annuity that is actuarially equivalent to the participant's form
of benefit shall be determined under this § 1-1208.a(5)(b)(i)
if the form of the participant's benefit is either (i) a nondecreasing
annuity (other than a straight life annuity) payable for a period
of not less than the life of the participant (or, in the case of a
preretirement survivor annuity, the life of the surviving spouse),
or (ii) an annuity that decreases during the life of the participant
merely because of (a) the death of the survivor annuitant (but only
if the reduction is not below 50% of the annual benefit payable before
the death of the survivor annuitant), or (b) the cessation or reduction
of Social Security supplements or qualified disability payments (as
defined in IRC Section 401(a)(11)).
a.
Limitation Years beginning before July 1, 2007. For limitation
years beginning before July 1, 2007, the actuarially equivalent straight
life annuity shall be equal to the annual amount of the straight life
annuity commencing at the same annuity starting date that has the
same actuarial present value as the participant's form of benefit
computed using whichever of the following produces the greater annual
amount: (a) the interest rate and the mortality table (or other tabular
factor) stated in § 1-1202.b(2) for adjusting benefits in
the same form; and (b) a 5% interest rate assumption and the applicable
mortality table defined in § 1-1202.b(3) for that annuity
starting date.
b.
Limitation Years beginning on or after July 1, 2007. For limitation
years beginning on or after July 1, 2007, the actuarially equivalent
straight life annuity is equal to the greater of: (a) the annual amount
of the straight life annuity (if any) payable to the participant under
the plan commencing at the same annuity starting date as the participant's
form of benefit; and (b) the annual amount of the straight life annuity
commencing at the same annuity starting date that has the same actuarial
present value as the participant's form of benefit, computed using
a 5% interest rate assumption and the applicable mortality table defined
in § 1-1202.b(3) for that annuity starting date.
(ii)
Benefit Forms Subject to IRC Section 417(e)(3).
The straight life annuity that is actuarially equivalent to the participant's
form of benefit shall be determined under this paragraph if the form
of the participant's benefit is other than a benefit form described
in § 1-1208.a(5)(b)(i). In this case, the actuarially equivalent
straight life annuity shall be determined as follows:
a.
Annuity Starting Date in Plan Years Beginning After
2005. If the annuity starting date of the participant's form of benefit
is in a plan year beginning after December 31, 2005, the actuarially
equivalent straight life annuity shall be equal to the greatest of:
(a) the annual amount of the straight life annuity commencing at the
same annuity starting date that has the same actuarial present value
as the participant's form of benefit, computed using the interest
rate and the mortality table (or other tabular factor) stated in § 1-1202.b(2)
for adjusting a lump sum pension payment; (b) the annual amount of
the straight life annuity commencing at the same annuity starting
date that has the same actuarial present value as the participant's
form of benefit, computed using a 5.5% interest rate assumption and
the applicable mortality table defined in § 1-1202.b(3);
and (3) the annual amount of the straight life annuity commencing
at the same annuity starting date that has the same actuarial present
value as the participant's form of benefit, computed using the applicable
interest rate and the applicable mortality table as defined in § 1-1202.b(3),
divided by 1.05.
b.
Annuity Starting Date in Plan Years Beginning in
2004 or 2005. If the annuity starting date of the participant's form
of benefit is in a plan year beginning in 2004 or 2005, the actuarially
equivalent straight life annuity shall be equal to the annual amount
of the straight life annuity commencing at the same annuity starting
date that has the same actuarial present value as the participant's
form of benefit, computed using whichever of the following produces
the greater annual amount: (a) the interest rate and the mortality
table (or other tabular factor) specified stated in § 1-1202.b(2)
for adjusting benefits in the same form; and (b) a 5.5% interest rate
assumption and the applicable mortality table as defined in § 1-1202.b(3).
Notwithstanding the preceding, if the annuity starting date
of the participant's benefit is on or after the first day of the first
plan year beginning in 2004 and before December 31, 2004, the application
of this § 1-1208.a(5)(b)(ii)b shall not cause the amount
payable under the participant's form of benefit to be less than the
benefit calculated under the plan, taking into account the limitations
of this § 1-1208.a, except that the actuarially equivalent
straight life annuity shall be equal to the annual amount of the straight
life annuity commencing at the same annuity starting date that has
the same actuarial present value as the participant's form of benefit,
computed using whichever of the following produces the greatest annual
amount:
1.
The interest rate and the mortality table (or other
tabular factor) specified stated in § 1-1202.b(2) for adjusting
benefits in the same form;
2.
The applicable interest rate and the applicable
mortality table as defined in § 1-1202.b(3); and
3.
The applicable interest rate defined in § 1-1202.b(3)
(as in effect on the last day of the last plan year beginning before
January 1, 2004) and the applicable mortality table defined in § 1-1202.b(3).
(c)
Compensation. A participant's earned income and any earnings
reportable as W-2 wages for federal income tax withholding purposes
that are paid by the employer. W-2 wages means wages as defined in
IRC Section 3401(a) but determined without regard to any rules that
limit the remuneration included in wages based on the nature or location
of the employment or the services performed. Picked-up contributions
under IRC Section 414(h)(2) shall not be included in the participant's
compensation.
For limitation years beginning after December 31, 1991, for
purposes of applying the limitations of this section 1208.a, compensation
for a limitation year is the compensation actually paid or includable
in gross income during such limitation year. Compensation for a limitation
year shall include amounts earned but not paid during the limitation
year solely because of the timing of pay periods and pay dates, provided
the amounts are paid during the first few weeks of the next limitation
year, the amounts are included on a uniform and consistent basis with
respect to all similarly situated employees, and no compensation is
included in more than one limitation year.
In order to be taken into account for a limitation year, compensation
must be paid or treated as paid prior to severance from employment
with the employer. Back pay, within the meaning of Treasury Regulation
Section 1.415(c)-2(g)(8), shall be treated as compensation for the
limitation year to which the back pay relates to the extent the back
pay represents wages and compensation that would otherwise be included
under this definition. Further, effective for limitation years beginning
on or after January 1, 2008, compensation in excess of the limitations
of § 1-1202.c(2) shall not be taken into account.
For limitation years beginning after December 31, 1997, compensation
shall include elective contributions. Elective contributions are amounts
excludable from the employee's gross income and contributed by the
employer, at the employee's election to a cafeteria plan excludable
under IRC Section 125, a IRC Section 401(k) arrangement (excludable
under IRC Section 402(e)(3)), a simplified employee pension (excludable
under IRC Section 402(h)), a tax sheltered annuity (excludable under
IRC Section 403(b)), a deferred compensation plan (excludable under
IRC Section 457(b)), a IRC Section 501(c)(18) plan, or a IRC Section
132(f)(4) qualified transportation fringe benefit plan.
Elective contribution amounts under a cafeteria plan excludable
under IRC Section 125 shall include any amounts not available to a
participant in cash in lieu of group health coverage because the participant
is unable to certify that he has other health coverage (deemed Section
125 compensation). An amount will be treated as an amount under IRC
Section 125 only if the employer does not request or collect information
regarding the participant's other health coverage as part of the enrollment
process for the health plan.
In order to be taken into account for a limitation year, compensation
must be paid or treated as paid prior to severance from employment
with the employer. Effective for limitation years beginning on or
after July 1, 2007, an includable payment shall be treated as paid
prior to severance from employment if it is paid by the later of 214
months after severance or the last day of the calendar year that includes
the severance date. For this purpose, includable payments are those
that absent the severance would have been paid and are regular compensation
for services during regular working hours or outside working hours
(such as overtime or shift differentials), commissions, bonuses, or
other similar compensation.
For limitation years beginning after December 31, 2008, compensation
for a limitation year shall include amounts paid as differential wages
to a participant on qualified military service leave of more than
30 days and otherwise meeting the requirements of the IRC Section
3401(h)(2).
(d)
Projected Annual Benefit. The annual benefit as defined in § 1-1208.a(5)(ii),
to which the participant would be entitled under the terms of the
plan assuming:
(i)
The participant will continue employment until his normal retirement
date under the plan (or current age, if later), and
(ii)
The participant's compensation for the current
limitation year and all other relevant factors used to determine benefits
under the plan will remain constant for all future limitation years.
Straight life annuity means an annuity payable in equal installments
for the life of the participant that terminates upon the participant's
death.
(e)
Defined Benefit Dollar Limitation. Effective for limitation
years ending after December 31, 2001, the defined benefit dollar limitation
is $160,000, automatically adjusted under IRC Section 415(d), effective
January 1 of each year, in such manner as the Secretary of the Treasury
shall prescribe, and payable in the form of a straight life annuity.
The new limitation shall apply to limitation years ending with or
within the calendar year for which the adjustment applies, but a participant's
benefits shall not reflect the adjusted limit prior to January 1 of
that calendar year. The automatic annual adjustment of the defined
benefit dollar limitation under IRC Section 415(d) shall apply to
participants who have had a separation from employment.
(f)
Employer. For purposes of this § 1-1208.a, employer
shall mean the employer that adopts this plan and any entity required
to be aggregated with the employer pursuant to regulations.
(g)
Excess Annual Addition. The excess of the participant's annual
additions for the limitation year over the maximum permissible annual
addition.
(h)
Limitation Year. The twelve-consecutive-month period defined
in § 1-1202.d(5).
(i)
Maximum Permissible Annual Addition. The maximum annual addition
that may be contributed or allocated to a participant's account under
a plan for any limitation year shall not exceed the lesser of:
(i)
The defined contribution dollar limitation, that is $40,000,
as adjusted under IRC Section 415(d) for limitation years beginning
after December 31, 2002, or
(ii)
One hundred percent of the participant's compensation
for the limitation year.
If a short limitation year is created because of an amendment
changing the limitation year to a different twelve-consecutive-month
period, the maximum permissible annual addition will not exceed the
defined contribution dollar limitation multiplied by the following
fraction:
Number of months in the short limitation year
12
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(j)
Maximum
Permissible Benefit. The maximum permissible benefit is the defined
benefit dollar limitation.
(i)
Adjustment for Less Than 10 Years of Participation or Service.
If the participant has less than 10 years of participation in the
plan, the defined benefit dollar limitation shall be multiplied by
a fraction: (i) the numerator of which is the number of years (or
part thereof, but not less than one year) of participation in the
plan, and (ii) the denominator of which is 10.
This § 1-1208.a(5)(j)(i) shall not apply to disability
benefit paid in accordance with Section 3.6 or to benefits payable
under Section IV.
(ii)
Adjustment of Defined Benefit Dollar Limitation
for Benefit Commencement Before Age 62 or After Age 65. Effective
for benefits commencing in limitation years ending after December
31, 2001, the defined benefit dollar limitation shall be adjusted
if the annuity starting date of the participant's benefit is before
age 62 or after age 65. If the annuity starting date is before age
62, the defined benefit dollar limitation shall be adjusted under
§ 1-1208.a(5)(j)(ii)a, as modified by § 1-1208.a(5)(j)(ii)c.
If the annuity starting date is after age 65, the defined benefit
dollar limitation shall be adjusted under § 1-1208.a(5)(j)(ii)b,
as modified by § 1-1208.a(5)(j)(ii)c.
a.
Adjustment of Defined Benefit Dollar Limitation
for Benefit Commencement Before Age 62.
1.
Limitation years beginning before July 1, 2007.
If the annuity starting date for the participant's benefit is prior
to age 62 and occurs in a limitation year beginning before July 1,
2007, the defined benefit dollar limitation for the participant's
annuity starting date is an annual amount of a benefit payable in
the form of a straight life annuity commencing at the participant's
annuity starting date that is the actuarial equivalent of the defined
benefit dollar limitation (adjusted under § 1-1208.a(5)(j)(i)
for years of participation less than 10, if required) with actuarial
equivalence computed using whichever of the following produces the
smaller annual amount: (1) the interest rate and the mortality table
(or the tabular factor) specified in § 1-1202.b(2) for an
early retirement benefit; or (2) a 5% interest rate assumption and
the applicable mortality table as defined in § 1-1202.b(c).
2.
Limitation years beginning on or after July 1, 2007.
a.
Plan does not have immediately commencing straight
life annuity payable at both age 62 and the age of benefit commencement.
If the annuity starting date for the participant's benefit is prior
to age 62 and occurs in a limitation year beginning on or after July
1, 2007, and the plan does not have an immediately commencing straight
life annuity payable at both age 62 and the age of benefit commencement,
the defined benefit dollar limitation for the participant's annuity
starting date is the annual amount of a benefit payable in the form
of a straight life annuity commencing at the participant's annuity
starting date that is the actuarial equivalent of the defined benefit
dollar limitation (adjusted under § 1-1208.a(5)(j)(i) for
years of participation less than 10, if required) with actuarial equivalence
computed using a 5% interest rate assumption and the applicable mortality
table for the annuity starting date as defined in § 1-1202.b(3)
(and expressing the participant's age based on completed calendar
months as of the annuity starting date).
b.
Plan has immediately commencing straight life annuity
payable at both age 62 and the age of benefit commencement. If the
annuity starting date for the participant's benefit is prior to age
62 and occurs in a limitation year beginning on or after July 1, 2007,
and the plan has an immediately commencing straight life annuity payable
at both age 62 and the age of benefit commencement, the defined benefit
dollar limitation for the participant's annuity starting date is the
lesser of the limitation determined under § 1-1208.a(5)(j)(ii)a2a.
and the defined benefit dollar limitation (adjusted under § 1-1208.a(5)(j)(i)
for years of participation less than 10, if required) multiplied by
the ratio of the annual amount of the immediately commencing straight
life annuity under the plan at the participant's annuity starting
date to the annual amount of the immediately commencing straight life
annuity under the plan at age 62, both determined without applying
the limitations of this § 1-1208.a.
3.
This § 1-1208.a(5)(j)(ii) a shall not
apply to disability benefit paid in accordance with § 1-1204.f
or to benefits payable under Section IV.
a.
Adjustment of Defined Benefit Dollar Limitation
for Benefit Commencement After Age 65.
1.
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Limitation years beginning before July 1, 2007. If
the annuity starting date for the participant's benefit is after age
65 and occurs in a limitation year beginning before July 1, 2007,
the defined benefit dollar limitation for the participant's annuity
starting date is the annual amount of a benefit payable in the form
of a straight life annuity commencing at the participant's annuity
starting date that is the actuarial equivalent of the defined benefit
dollar limitation (adjusted under § 1-1208.a(5)(j)(i) for
years of participation less than 10, if required) with actuarial equivalence
computed using whichever of the following produces the smaller annual
amount: (1) the interest rate and the mortality table (or other tabular
factor) specified in § 1-1202.b(2) for a late retirement
benefit; or (2) a 5% interest rate assumption and the applicable mortality
table as defined in § 1-1202.b(3).
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2.
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Limitation years after July 1, 2007.
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a.
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Plan does not have immediately commencing straight
life annuity payable at both age 65 and the age of benefit commencement.
If the annuity starting date for the participant's benefit is after
age 65 and occurs in a limitation year beginning on or after July
1, 2007, and the plan does not have an immediately commencing straight
life annuity payable at both age 65 and the age of benefit commencement,
the defined benefit dollar limitation at the participant's annuity
starting date is the annual amount of a benefit payable in the form
of a straight life annuity commencing at the participant's annuity
starting date that is the actuarial equivalent of the defined benefit
dollar limitation (adjusted under § 1-1208.a(5)(j)(i) for
years of participation less than 10, if required), with actuarial
equivalence computed using a 5% interest rate assumption and the applicable
mortality table for that annuity starting date as defined in § 1-1202.b(3)
(and expressing the participant's age based on completed calendar
months as of the annuity starting date).
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b.
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Plan has immediately commencing straight life annuity
payable at both age 65 and the age of benefit commencement. If the
annuity starting date for the participant's benefit is after age 65
and occurs in a limitation year beginning on or after July 1, 2007,
and the plan has an immediately commencing straight life annuity payable
at both age 65 and the age of benefit commencement, the defined benefit
dollar limitation at the participant's annuity starting date is the
lesser of the limitation determined under § 1-1208.a(5)(j)(ii)b.2.
and the defined benefit dollar limitation (adjusted under § 1-1208.a(5)(j)(i)
for years of participation less than 10, if required) multiplied by
the ratio of the annual amount of the adjusted immediately commencing
straight life annuity under the plan at the participant's annuity
starting date to the annual amount of the adjusted immediately commencing
straight life annuity under the plan at age 65, both determined without
applying the limitations of this section 1208.a. For this purpose,
the adjusted immediately commencing straight life annuity under the
plan at the participant's annuity starting date is the annual amount
of such annuity payable to the participant, computed disregarding
the participant's accruals after age 65 but including actuarial adjustments
even if those actuarial adjustments are used to offset accruals; and
the adjusted immediately commencing straight life annuity under the
plan at age 65 is the annual amount of such annuity that would be
payable under the plan to a hypothetical participant who is age 65
and has the same accrued benefit as the participant.
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3.
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Notwithstanding the other requirements of this § 1-1208.a(5)(j)(ii),
no adjustment shall be made to the defined benefit dollar limitation
to reflect the probability of a participant's death between the annuity
starting date and age 62, or between age 65 and the annuity starting
date, as applicable, if benefits are not forfeited upon the death
of the participant prior to the annuity starting date. To the extent
benefits are forfeited upon death before the annuity starting date,
such an adjustment shall be made. For this purpose, no forfeiture
shall be treated as occurring upon a participant's death if the plan
does not charge participants for providing a qualified preretirement
survivor annuity upon the participant's death.
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(iii)
Minimum Benefit Permitted. Notwithstanding anything
else in this section to the contrary, the benefit otherwise accrued
or payable to a participant under this plan shall be deemed not to
exceed the maximum permissible benefit if:
a.
The retirement benefits payable for a plan year
under any form of benefit with respect to such participant under this
plan and under all other defined benefit plans (regardless of whether
terminated) ever maintained by the employer do not exceed $10,000
multiplied by a fraction: (1) the numerator of which is the participant's
number of years (or parts thereof, but not less than one year) of
benefit service (not to exceed 10) with the employer; and (2) the
denominator of which is 10; and
b.
The employer (or a predecessor employer) has not
at any time maintained a defined contribution plan in which the participant
participated. For this purpose, mandatory employee contributions shall
not be considered a separate defined contribution plan maintained
by the employer. Similarly, individual medical accounts under IRC
Section 401(h) and accounts for postretirement medical benefits established
under IRC Section 419A(d)(1) shall not be considered a separate defined
contribution plan.
(k)
Year of Participation. For the purpose of this § 1-1208.a,
a participant shall be credited with a year of participation (computed
to fractional parts of a year) for each accrual computation period
for which the following conditions are met: (1) the participant is
credited with at least the number of hours of service (or period of
service if the elapsed time method is used) for benefit accrual purposes,
required under the terms of the plan in order to accrue a benefit
for the accrual computation period, and (2) the participant is included
as a participant under the eligibility provisions of the plan for
at least one day of the accrual computation period. If these two conditions
are met, the portion of a year of participation credited to the participant
shall equal the amount of benefit accrual service credited to the
participant for such accrual computation period. A participant who
is permanently and totally disabled within the meaning of IRC Section
415(c)(3)(C)(i) for an accrual computation period shall receive a
year of participation with respect to that period. In addition, for
a participant to receive a year of participation (or part thereof)
for an accrual computation period, the plan must be established no
later than the last day of such accrual computation period. In no
event will more than one year of participation be credited for any
twelve-month period.
(i)
Annuity Starting Date. The first day of the first period for
which an amount is paid as an annuity or in any other form.
b.
Distribution Requirements. The requirements of this § 1-1208.b
shall apply to any distribution of a participant's interest. With
respect to distributions under the plan made on or after January 1,
2005 for calendar years beginning on or after January 1, 2005, the
plan will apply the minimum distribution requirements of IRC Section
401(a)(9) as set forth in this § 1-1208.b. Distributions
made prior to January 1, 2005 are subject to the provisions of the
plan as in effect before this amendment and restatement of the plan.
(1)
Time and Manner of Distribution.
(a)
Required Beginning Date. The entire interest of a participant
must be distributed or begin to be distributed no later than the participant's
required beginning date.
(b)
Limits on Distribution Periods. As of the first distribution
calendar year, distributions to a participant, if not made in a single-sum,
may only be made over one of the following periods (or a combination
thereof):
(i)
The life of the participant,
(ii)
The joint lives of the participant and a designated
beneficiary,
(iii)
A period certain not extending beyond the life
expectancy of the participant, or
(iv)
A period certain not extending beyond the joint
life and last survivor expectancy of the participant and a designated
beneficiary.
(c)
Death of Participant Before Distributions Begin. If the participant
dies before distributions begin, the participant's entire interest
will be distributed, or begin to be distributed, no later than as
follows:
(i)
If the participant's surviving spouse is the participant's sole
designated beneficiary, then distributions to the surviving spouse
will begin by December 31 of the calendar year immediately following
the calendar year in which the participant died, or by December 31
of the calendar year in which the participant would have attained
age 70 1/2, if later. If this plan provides in Section IV for
a lump sum death benefit and the surviving spouse so elects, the participant's
entire interest will be distributed to such designated beneficiary
by December 31 of the calendar year containing the fifth anniversary
of the participant's death.
(ii)
If the participant's surviving spouse is not the
participant's sole designated beneficiary, then distributions to the
designated beneficiary will begin by December 31 of the calendar year
immediately following the calendar year in which the participant died.
If this plan provides in Section IV for a lump sum death benefit and
the designated beneficiary so elects, the participant's entire interest
will be distributed to such designated beneficiary by December 31
of the calendar year containing the fifth anniversary of the participant's
death.
(iii)
If there is no designated beneficiary as of September
30 of the year following the year of the participant's death or if
a lump sum death benefit is otherwise payable, the participant's entire
interest will be distributed by December 31 of the calendar year containing
the fifth anniversary of the participant's death.
(iv)
If the participant's surviving spouse is the participant's
sole designated beneficiary and the surviving spouse dies after the
participant but before distributions to the surviving spouse begin,
this § 1-1208.b(1)(c), other than § 1-1208.b(1)(c)(iii),
will apply as if the surviving spouse were the participant if this
plan otherwise provides for the payment of a death benefit.
For purposes of this § 1-1208.b(1)(c) and § 1-1208.b(4),
distributions are considered to begin on the participant's required
beginning date (or, if § 1-1208.b(1)(c)(iv) applies, the
date distributions are required to begin to the surviving spouse under
§ 1-1208.b(1)(c)(i)). If annuity payments irrevocably commence
to the participant before the participant's required beginning date
(or to the participant's surviving spouse before the date distributions
are required to begin to the surviving spouse under § 1-1208.b(1)(c)(i)),
the date distributions are considered to begin is the date distributions
actually commence.
If the deceased designated beneficiary is not the participant's
surviving spouse, distribution shall be completed by the December
31 of the fifth year following the participant's date of death. If
the deceased designated beneficiary is the participant's surviving
spouse, distribution shall be completed by the December 31 of the
fifth year following the beneficiary's date of death.
(d)
Forms of Distribution. Unless the participant's interest is
distributed in the form of an annuity purchased from an insurance
company or in a single sum on or before the required beginning date,
as of the first distribution calendar year distributions will be made
in accordance with § 1-1208.b(2), (3), and (4). If the participant's
interest is distributed in the form of an annuity purchased from an
insurance company, distributions thereunder will be made in accordance
with the requirements of IRC Section 401(a)(9) and Regulation Section
1.401(a)(9)-6.
Any part of the participant's interest that is in the form of
an individual account shall be distributed in a manner satisfying
the requirements of IRC Section 401(a)(9) and the regulations thereunder.
To the extent the participant has accumulated contributions containing
after-tax contributions for which there is separate accounting; such
funds shall be distributed first before any taxable distribution is
made to satisfy the minimum distribution requirement.
(2)
Determination of Amount to Be Distributed Each Year.
(a)
General Annuity Requirements. If
the participant's interest is to be paid in the form of annuity distributions
under the plan, payments under the annuity shall satisfy the following
requirements:
(i)
The annuity distribution must be paid in periodic payments made
at intervals not longer than one year;
(ii)
The distribution period must be over a life (or
lives) or over a period certain not longer than the period described
in § 1-1208.b(3) or (4);
(iii)
Once payments have begun over a period certain,
the period certain may only be changed as permitted under Regulation
Section 1.401(a)(9)-6, A-13;
(iv)
Payments must either be nonincreasing or increase
only as follows:
a.
By an annual percentage that does not exceed the
annual percentage increase in a cost-of-living index that is based
on prices of all items and issued by the Bureau of Labor Statistics;
b.
To the extent of the reduction to the amount of
the participant's payments to provide for a survivor benefit upon
death, but only if the beneficiary whose life was being used to determine
the distribution period described in § 1-1208.c(3) dies
or is no longer the participant's beneficiary pursuant to a qualified
domestic relations order within the meaning of IRC Section 414(p);
c.
To provide cash refunds of employee contributions
upon the participant's death;
d.
To pay increased benefits that result from a plan
amendment; or
e.
To the extent increases are permitted in accordance
with Regulation Section 1.401(a)(9)-6, A-14(c) or (d).
(b)
Amount Required to be Distributed by Required Beginning Date.
(i)
The amount that must be distributed on or before the participant's
required beginning date (or, if the participant dies before distributions
begin, the date distributions are required to begin under § 1-1208.b(1)(c)(i)
or (ii)) shall be the payment that is required for one payment interval.
The second payment need not be made until the end of the next payment
interval even if that payment interval ends in the next calendar year.
Payment intervals are the periods for which payments are received,
e.g., bi-monthly, monthly, semi-annually, or annually. All of the
participant's benefit accruals as of the last day of the first distribution
calendar year will be included in the calculation of the amount of
the annuity payments for payment intervals ending on or after the
participant's required beginning date.
(ii)
In the case of a lump sum distribution of the
participant's accrued benefit on or before the participant's required
beginning date, the minimum required distribution shall be determined
by expressing the participant's benefit as a pension payable in the
normal form of payment with an annuity starting date as of the first
day of the distribution calendar year and multiplying the monthly
benefit by 12. If the distribution is being made before the April
1 required beginning date but in such year, both the first and second
years required minimum distribution shall be determined and shall
not be eligible for rollover.
(c)
Additional Accruals After First Distribution Calendar Year.
Any additional benefits accruing to the participant in a calendar
year after the first distribution calendar year will be distributed
beginning with the first payment interval ending in the calendar year
immediately following the calendar year in which such amount accrues.
(3)
Requirements For Annuity Distributions That Commence During
Participant's Lifetime.
(a)
Joint Life Annuities Where the Beneficiary Is Not the Participant's
Spouse. If the participant's interest is being distributed in the
form of a joint and survivor annuity for the joint lives of the participant
and a nonspouse beneficiary, annuity payments to be made on or after
the participant's required beginning date to the designated beneficiary
after the participant's death must not at any time exceed the applicable
percentage of the annuity payment for such period that would have
been payable to the participant using the table set forth in Regulation
Section 1.401(a)(9)-6, A-2(c)(2), in the manner described in A-2(c)(1)
to determine the applicable percentage. If the form of distribution
combines a joint and survivor annuity for the joint lives of the participant
and a nonspouse beneficiary and a period certain annuity, the requirement
in the preceding sentence will apply to annuity payments to be made
to the designated beneficiary after the expiration of the period certain.
(b)
Period Certain Annuities. Unless the participant's spouse is
the sole designated beneficiary and the form of distribution is a
period certain and no life annuity, the period certain for an annuity
distribution commencing during the participant's lifetime may not
exceed the applicable distribution period for the participant under
the Uniform Lifetime Table set forth in Regulation Section 1.401(a)(9)-9,
A-2 for the calendar year that contains the annuity starting date.
If the annuity starting date precedes the year in which the participant
reaches age 70, the applicable distribution period for the participant
is the distribution period for age 70 under the Uniform Lifetime Table
set forth in Regulation Section 1.401(a)(9)-9, A-2 plus the excess
of 70 over the age of the participant as of the participant's birthday
in the year that contains the annuity starting date. If the participant's
spouse is the participant's sole designated beneficiary and the form
of distribution is a period certain and no life annuity, the period
certain may not exceed the longer of the participant's applicable
distribution period, as determined under this § 1-1208.b(3)(a),
or the joint life and last survivor expectancy of the participant
and the participant's spouse as determined under the Joint and Last
Survivor Table set forth in Regulation Section 1.401(a)(9)-9, A-3,
using the participant's and spouse's attained ages as of the participant's
and spouse's birthdays in the calendar year that contains the annuity
starting date.
(4)
Requirements For Minimum Distributions After the Participant's
Death.
(a)
Death After Distributions Begin. If the participant dies after
distribution of his interest has begun in the form of an annuity meeting
the requirements of this § 1-1208.b, the remaining portion
of such interest will continue to be distributed over the remaining
period over which distributions have commenced.
(b)
Death Before Distributions Begin.
(i)
Participant Survived by Designated Beneficiary. If the participant
dies before the date distribution of his or her interest begins and
there is a designated beneficiary, the participant's entire interest
will be distributed, beginning no later than the time described in
§ 1-1208.b(1)(c)(i) or (ii), over the life of the designated
beneficiary or over a period certain not exceeding:
a.
Unless the annuity starting date is before the first distribution
calendar year, the life expectancy of the designated beneficiary determined
using the beneficiary's age as of the beneficiary's birthday in the
calendar year immediately following the calendar year of the participant's
death; or
b.
If the annuity starting date is before the first distribution
calendar year, the life expectancy of the designated beneficiary determined
using the beneficiary's age as of the beneficiary's birthday in the
calendar year that contains the annuity starting date.
(ii)
No Designated Beneficiary. If the participant
dies before the date distributions begin and there is no designated
beneficiary as of September 30 of the year following the year of the
participant's death, distribution of the participant's entire interest
will be completed by December 31 of the calendar year containing the
fifth anniversary of the participant's death.
(iii)
Death of Surviving Spouse Before Distributions
to Surviving Spouse Begin. If the participant dies before the date
distribution of his interest begins, the participant's surviving spouse
is the participant's sole designated beneficiary, and the surviving
spouse dies before distributions to the surviving spouse begin, this
§ 1-1208.b(4) will apply as if the surviving spouse were
the participant, except that the time by which distributions must
begin will be determined without regard to § 1-1208.b(1)(c)(i).
(5)
Definitions (IRC Section 401(a)(9) Requirements).
(a)
Designated Beneficiary. The individual who is designated as
the beneficiary under the plan and is the designated beneficiary under
IRC Section 401(a)(9) and Regulation Section 1.401(a)(9)-4.
(b)
Distribution Calendar Year. A calendar year for which a minimum
distribution is required. For distributions beginning before the participant's
death, the first distribution calendar year is the calendar year immediately
preceding the calendar year that contains the participant's required
beginning date. For distributions beginning after the participant's
death, the first distribution calendar year is the calendar year in
which distributions are required to begin pursuant to § 1-1208.b(1)(c)
above.
(c)
Life Expectancy. Life expectancy as computed by use of the Single
Life Table in Regulation Section 1.401(a)(9)-9, A-1.
(d)
Required Beginning Date. The required beginning date of a participant
is the later of: (i) the first day of April of the calendar year following
the calendar year in which the participant attains age 70 1/2
and (ii) the first day of April of the calendar year following the
calendar year in which the participant retires.
(6)
TEFRA Section 242(b)(2) Elections.
(a)
This plan was originally effective prior to January 1, 1984
and permitted participants to make elections under Tax Equity and
Fiscal Responsibility Act of 1982 (TEFRA) Section 242(b)(2); therefore,
notwithstanding the other requirements of this § 1-1208.b,
distribution on behalf of any employee may be made in accordance with
all of the following requirements (regardless of when such distribution
commences).
(i)
The distribution by the plan is one which would not have disqualified
such trust under IRC Section 401(a)(9) as in effect prior to amendment
by the Deficit Reduction Act of 1984.
(ii)
The distribution is in accordance with a method
of distribution designated by the employee whose interest in the plan
is being distributed or, if the employee is deceased, by a beneficiary
of such employee.
(iii)
Such designation was in writing, was signed by
the employee or the beneficiary, and was made before January 1, 1984.
(iv)
The employee had accrued a benefit under the plan
as of December 31, 1983.
(v)
The method of distribution designated by the employee or the
beneficiary specifies the time at which distribution will commence,
the period over which distributions will be made, and in the case
of any distribution upon the employee's death, the beneficiaries of
the employee listed in order of priority.
A distribution upon death will not be covered by this transitional
rule unless the information in the designation contains the required
information described above with respect to the distributions to be
made upon the death of the employee.
(b)
For any distribution that commences before January 1, 1984,
but continues after December 31, 1983, the employee, or the beneficiary,
to whom such distribution is being made will be presumed to have designated
the method of distribution under which the distribution is being made
if the method of distribution was specified in writing and the distribution
satisfies the requirements in § 1-1208.b(6)(a)(i) and (v).
(c)
If a designation is revoked any subsequent distribution must
satisfy the requirements of IRC Section 401(a)(9) and the regulations
thereunder. If a designation is revoked subsequent to the date distributions
are required to begin, the plan must distribute by the end of the
calendar year following the calendar year in which the revocation
occurs the total amount not yet distributed that would have been required
to have been distributed to satisfy IRC Section 401(a)(9) and the
regulations thereunder, but for the election made under Tax Equity
and Fiscal Responsibility Act of 1982 Section 242(b)(2). For calendar
years beginning after December 31, 1988, such distributions must meet
the minimum distribution incidental benefit requirements. Any changes
in the designation will be considered to be a revocation of the designation.
However, the mere substitution or addition of another beneficiary
(one not named in the designation) under the designation will not
be considered to be a revocation of the designation, so long as such
substitution or addition does not alter the period over which distributions
are to be made under the designation, directly or indirectly (for
example, by altering the relevant measuring life). In the case in
which an amount is transferred or rolled over from one plan to another
plan, the rules in Regulation Section 1.401(a)(9)-8, A-14 and A-15
shall apply.
[Ord. 1925, 2/2/2009]
a.
Fiduciary Responsibility.
(1)
Management and Control of Plan Assets. The governing body of
the employer shall designate the persons responsible for the management
and control of plan assets. Such persons shall discharge their duties
with respect to the plan in accordance with the documents and instruments
governing the plan insofar as such documents and instruments are consistent
with the applicable provisions of the Internal Revenue Code.
(2)
A fiduciary of this plan is required to exercise the judgment
and care under the circumstances then prevailing that men of prudence,
discretion and intelligence exercise in the management of their own
affairs, not in regard to speculation but in regard to the permanent
disposition of their funds, considering the probable income as well
as the probable safety of their capital.
(3)
Allocation of Responsibility.
(a)
When the plan administrator is required to follow the directions
of the trustee or the trustee is required to follow the directions
of the plan administrator, they shall not be deemed to share such
responsibility. Instead, the responsibility of the person giving the
directions shall be deemed to be his sole responsibility and the responsibility
of the person receiving directions shall be to follow those directions
insofar as such instructions on their face are proper under applicable
law.
(b)
The plan administrator or trustee under this plan may employ
one or more persons, including independent accountants, attorneys,
and actuaries to render advice with regard to any responsibility such
person has under the plan.
(4)
Liability and Indemnification. Subject to Act 205, no past,
present, or future officer of the employer nor of any participating
employer shall be personally liable to any participant, beneficiary,
or other person under any provision of the plan or trust or any insurance
policy or contract issue pursuant thereto. No individual fiduciary
shall be liable for any act or omission of any other fiduciary. Unless
resulting from the gross negligence, willful misconduct or lack of
good faith on the part of the fiduciary, the employer shall indemnify
and save harmless such fiduciary from, against, for and in respect
of any and all damages, losses, obligations, liabilities, liens, deficiencies,
costs and expenses, including without limitation, reasonable attorney's
fees and other costs and expenses incident to any suit, action, investigation,
claim or proceedings suffered in connection with his acting as a fiduciary
under the plan.
b.
Chief Administrative Officer.
(1)
Appointment of Chief Administrative Officer. The governing body
of the employer shall be responsible for the administration of the
plan. It shall appoint the chief administrative officer. The employer
shall review at regular intervals the performance of the person appointed
to be the chief administrative officer and shall re-evaluate the appointment
of such chief administrative officer.
(2)
Duties and Powers of Chief Administrative Officer. The chief
administrative officer shall be the plan administrator and as such
shall have the following duties and discretionary powers and such
other duties and discretionary powers as relate to the administration
of the plan:
(a)
To determine in a non-discriminatory manner all questions relating
to the eligibility of employees to become participants.
(b)
To determine in a non-discriminatory manner eligibility for
benefits and to determine and certify the amount and kind of benefits
payable to participants.
(c)
To authorize all disbursements from the fund.
(d)
To appoint or employ, upon approval of the employer, any independent
person to perform necessary plan functions and to assist in the fulfillment
of administrative responsibilities as he deems advisable, including
the retention of a third party administrator, custodian, auditor,
accountant, actuary, or attorney.
(e)
When appropriate, to select an insurance company and annuity
contracts that, in his opinion, will best carry out the purposes of
the plan.
(f)
To construe and interpret any ambiguities in the plan and to
make, publish, interpret, alter, amend or revoke rules for the regulation
of the plan that are consistent with the terms of the plan and with
the applicable provisions of the Internal Revenue Code.
(g)
To prepare and distribute, in such manner as determined to be
appropriate, information explaining the plan.
(3)
Miscellaneous Provisions.
(a)
Expenses. The chief administrative officer shall serve without
compensation for service as such. All reasonable expenses of the chief
administrative officer shall be paid by the plan.
(b)
Examination of Records. The chief administrative officer shall
make available to any participant for examination during business
hours such of the plan records as pertain only to the participant
involved.
(c)
Information to the Chief Administrative Officer. To enable the
chief administrative officer to perform the administrative functions,
the employer shall supply full and timely information to the chief
administrative officer on all participants as the chief administrative
officer may require.
c.
Claims Procedure.
(1)
Notification of Claim Determination. The chief administrative
officer shall notify each participant in writing of his determination
of benefits. If the chief administrative officer denies any benefit,
such written denial shall include:
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The specific reasons for denial;
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•
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Reference to provisions on which the denial is based;
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•
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A description of and reason for any additional information needed
to process the claim; and
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•
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An explanation of the claims procedure.
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(2)
Appeal. The participant or his duly authorized representative
may:
•
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Request a review of the participant's case in writing to the
employer;
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•
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Review pertinent documents;
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•
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Submit issues and comments in writing.
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The written request for review must be submitted no later than
60 days after receiving written notification of denial of benefits.
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(3)
Review. The employer must render a decision no later than 60
days after receiving the written request for review, unless circumstances
make it impossible to do so; but in no event shall the decision be
rendered later than 120 days after the request for review is received.
(4)
Limitation on Time Period for Litigation of a Benefit Claim.
Following receipt of the written rendering of the employer's decision
under § 1-1209.c(3), the participant shall have 365 days
in which to file suit in the appropriate court. Thereafter, the right
to contest the decision shall be waived.
d.
Trust Fund.
(1)
Creation and Maintenance of the Fund. The trust fund shall be
created and maintained in the following manner:
(a)
All funds on deposit and held for pension or retirement benefits
of the participants shall continue to be part of the trust fund created
and maintained hereby subject to any liabilities that may exist against
such fund.
(b)
The employer shall allocate to the fund the payments made by
the Treasurer of the Commonwealth of Pennsylvania from monies received
from taxes paid upon premiums by foreign casualty insurance companies
and foreign fire insurance companies pursuant to the General Municipal
Pension System State Aid Program.
(c)
The employer shall also allocate to the fund any mandatory employee
contributions received in accordance with the plan.
(d)
The fund shall accept and maintain any payments made by other
gifts, grants, devises, or bequests to the fund.
(e)
The employer shall contribute to the fund such other payments
as may, from time to time, be authorized to be made from the general
revenue of the employer.
All such payments received shall be part of the trust fund and
shall not be applied to any other account or disbursed in any manner
except as provided by this plan. Payments required under the plan
shall be a charge only upon the trust fund and not upon other monies
or funds of the employer.
(2)
Appointment of Trustee. The employer, or its delegee, shall
appoint a trustee for the proper care and custody of all funds, securities
and other properties in the trust, and for investment of plan assets
(or for execution of such orders as it receives from an investment
manager appointed for investment of plan assets). The duties and powers
of the trustee shall be set forth in a trust agreement executed by
the employer, that is incorporated herein by reference. The employer
shall review at regular intervals the performance of the trustee and
shall re-evaluate the appointment of such trustee. After the employer
has appointed the trustee and has received a written notice of acceptance
of its responsibility, the responsibility with respect to the proper
care and custody of plan assets shall be considered as the responsibility
of the trustee. Unless otherwise allocated to an investment manager,
the responsibility with respect to investment of plan assets shall
likewise be considered as the responsibility of the trustee.
(3)
Appointment of Corporate Custodian. The employer, or its delegee,
may appoint a corporate custodian to hold and invest the fund. The
corporate custodian shall carry out its responsibilities in accordance
with the terms of the custodial agreement and the investment policy
and guidance as the employer shall, from time to time provide. The
employer shall review at regular intervals no less frequently than
annually, the performance of such corporate custodian and shall re-evaluate
the appointment of such corporate custodian.
(4)
Appointment of Investment Manager. The employer, or its delegee,
may appoint an investment manager who is other than the trustee, which
investment manager may be a bank or an investment advisor registered
with the Securities and Exchange Commission under the Investment Advisors
Act of 1940. Such investment manager, if appointed, shall have sole
discretion in the investment of plan assets, subject to the funding
policy. The employer shall review at regular intervals no less frequently
than annually, the performance of such investment manager and shall
re-evaluate the appointment of such investment manager. After the
employer has appointed an investment manager and has received a written
notice of acceptance of his responsibility, the responsibility with
respect to investment of plan assets shall be considered as the responsibility
of the investment manager.
(5)
Funding Policy. The employer, or its delegee, shall determine
and communicate in writing to the person responsible for investment
of plan assets the funding policy for the plan. The funding policy
shall set forth the plan's short-range and long-range financial needs,
so that said person may coordinate the investment of plan assets with
the plan's financial needs.
(6)
Valuation of the Fund. The fund shall be valued by the trustee
as of the last day of each plan year and as of any interim accounting
date determined by the plan administrator.
The valuation shall be made on the basis of the current fair
market value of all property in the fund.
e.
Actuarial Valuation and Funding.
(1)
Actuarial Valuation. In compliance with Act 205, the actuarial
valuation report shall be prepared and filed under the supervision
of the chief administrative officer of the municipality or of the
association of municipalities cooperating pursuant to the Intergovernmental
Cooperation Act and named as the sponsoring employer of this plan.
The actuary shall perform an actuarial valuation at least biennially.
Each biennial actuarial valuation report shall be made as of the beginning
of such plan year and shall be prepared and certified by an approved
actuary. An approved actuary means a person who has at least five
years of actuarial experience with public pension plans and who is
either enrolled as a member of the American Academy of Actuaries or
enrolled as an actuary pursuant to ERISA.
If the employer is applying or has applied for Supplemental
State Assistance pursuant to Section 603 of the Act, the actuarial
valuation report shall be made annually.
(2)
Allowable Administrative Expenses. The expenses attributable
to the preparation of any actuarial valuation report or investigation
required by Act 205 or any other expense that is permissible under
the terms of Act 205 and that are directly associated with administering
the plan shall be an allowable administrative expense payable from
the assets of the trust.
(3)
Benefit Modifications. Prior to the adoption of any benefit
plan modification by the employer, the chief administrative officer
of the plan shall provide to the employer a cost estimate of the proposed
benefit plan modification prepared by an approved actuary. Such estimate
shall disclose to the employer 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.
[Ord. 1925, 2/2/2009]
a.
Right to Discontinue and Amend. It is the expectation of the employer
that it will continue this plan indefinitely and make the payments
of its contributions hereunder, but the continuance of the plan is
not assumed as a contractual obligation of the employer and the right
is reserved by the employer, at any time, to reduce, suspend, or discontinue
its contributions hereunder.
b.
Amendments. Except as herein limited, the employer shall have the
right to amend this plan at any time to any extent that it may deem
advisable. Such amendment shall be stated in writing and shall be
by ordinance or resolution of the governing body of the employer.
The employer's right to amend the plan shall be limited as follows:
(1)
No amendment shall be adopted in violation of the laws of the
Commonwealth of Pennsylvania.
(2)
No amendments shall have the effect of vesting in the employer
any interest in or control over any contracts issued pursuant hereto
or any other property in the fund.
(3)
No amendment to the vesting schedule adopted by the employer
hereunder shall deprive a participant of his vested portion of his
employer-derived accrued benefit to the date of such amendment.
c.
Protection of Benefits in Case of Plan Merger. In the event of a
merger or consolidation with, or transfer of assets or liabilities
to any other plan, each participant will receive a benefit immediately
after such merger, consolidation or transfer (if the plan then terminated)
that is at least equal to the benefit the participant was entitled
to immediately before such merger, consolidation or transfer (if the
plan had terminated).
d.
Termination of Plan.
(1)
When Plan Terminates. This plan shall terminate upon the legal
dissolution of the employer or the termination of the plan by the
amendment action of the employer. Subject to the provisions of the
Municipal Pension Plan Funding Standard and Recovery Act (P.L. 1005,
Act 205 of 1984) governing financially distressed municipalities,
the liability of the employer to make contributions to the plan shall
automatically terminate upon liquidation or dissolution of the employer,
upon its adjudication as bankrupt, or upon the making of a general
assignment for the benefit of its creditors.
(2)
Allocation of Assets. Upon termination or partial termination,
the accrued benefit of each affected participant who is an active
participant or who is not an active participant but has not incurred
a one-year break in service shall be 100% vested and nonforfeitable;
however, no participant or other individual shall have recourse towards
the satisfaction of any benefit accrued under the plan other than
from the fund. The amount of the fund assets shall be allocated to
participants and beneficiaries subject to provisions for expenses
of administration of liquidation. The allocation of assets shall be
in accordance with the following (to the extent assets are sufficient).
(a)
There shall be allocated an amount equal to that portion of
each individual's accrued benefit that is derived from the participant's
voluntary contributions.
(b)
There shall be allocated an amount equal to that portion of
each individual's accrued benefit that is derived from the participant's
mandatory contributions.
(c)
Pension allocations.
(i)
There shall be allocated amounts sufficient to provide the pension
of each participant or beneficiary who was receiving such a benefit
three years before the date of termination.
(ii)
There shall likewise be allocated amounts sufficient
to provide the normal form of pension for each participant who was
eligible to retire three years before the date of termination but
had not done so.
In both cases, the benefits shall be based upon the plan provisions
in effect during the five years before the date of termination under
which such benefits would be the least.
(d)
There shall be allocated amounts sufficient to provide all vested
benefits due participants.
(e)
There shall be allocated amounts sufficient to provide all other
benefits of the plan.
If assets are insufficient to provide all benefits within any
one of the above paragraphs (a) through (e), they shall be allocated
pro rata among the participants or beneficiaries within that paragraph
on the basis of the present value of such benefits.
The allocation of assets, when determined by the actuary, may
be implemented through the continuation of the existing fund or through
the purchase of insurance company annuity contracts, or by a combination
of these media. If the allocations produce a lump sum actuarial value
of less than $5,000 for any participant, such participant may be paid,
in lieu of a pension, a lump sum in satisfaction of his full interest
in the plan.
(3)
Remaining Fund Balance. Notwithstanding any provision in this
plan to the contrary, upon the termination of the plan, but only after
all liabilities to the participants and their respective beneficiaries
have been satisfied, the employer shall be entitled to any balance
of the net assets of the fund that shall remain by reason of erroneous
actuarial computations or overpayments during the life of the plan.
However, if any assets of the plan attributable to employee
contributions remain after satisfaction of all liabilities described
in § 1-1210.d(2), such remaining assets shall be equitably
distributed to the participants who made such contributions or their
beneficiaries (including alternate payees). For this purpose, the
portion of the remaining assets that are attributable to employee
contributions shall be an amount equal to the product derived by multiplying
the market value of the total remaining assets, by a fraction - (i)
the numerator of which is the present value of all portions of the
accrued benefits with respect to participants that are derived from
participants' mandatory contributions, and (ii) the denominator of
which is present value of all benefits with respect to which assets
are allocated under items (2) through (7) of § 1-1210.d(2).
A participant for this purpose shall include an individual who has
received, during the three-year period ending with the termination
date, a distribution from the plan of such individual's entire nonforfeitable
benefit in the form of a single sum distribution or in the form of
irrevocable commitments purchased by the plan from an insurer to provide
such nonforfeitable benefit, if all or part of the nonforfeitable
benefit with respect to such person is or was attributable to a participant's
mandatory contributions.
[Ord. 1925, 2/2/2009]
a.
Exclusive Benefit - Non-Reversion. The plan is created for the exclusive
benefit of the employees of the employer and shall be interpreted
in a manner consistent with its being a qualified plan as defined
in IRC Section 401(a). The corpus or income of the trust may not be
diverted to or used for other than the exclusive benefit of the participants
or their beneficiaries. Notwithstanding the above, any contribution
made by the employer because of a mistake of fact must be returned
to the employer within one year of the contribution. Further, a reversion
to the employer is permissible upon plan termination in accordance
with § 1-1210.d(3).
b.
Inalienability of Benefits. No benefit or interest available hereunder
including any annuity contract distributed herefrom shall be subject
to assignment or alienation, either voluntarily or involuntarily.
The preceding sentence shall also apply to the creation, assignment,
or recognition of a right to any benefit payable with respect to a
participant pursuant to a domestic relations order, unless such order
is determined to be an acceptable domestic relations order as defined
in IRC Section 414(p), or any domestic relations order entered before
January 1, 1985.
c.
Employer-Employee Relationship. This plan is not to be construed
as creating or changing any contract of employment between the employer
and its employees, and the employer retains the right to deal with
its employees in the same manner as though this plan had not been
created.
d.
Binding Agreement. This plan shall be binding on the heirs, executors,
administrators, successors and assigns as such terms may be applicable
to any or all parties hereto, and on any participants, present or
future.
e.
Inconsistency or Conflict of Prior Ordinances or Resolutions. Any
ordinance or resolution with an effective date prior to the adoption
date of this amendment and restatement of the plan shall be of no
effect.
f.
Separability. If any provision of this plan shall be held invalid
or unenforceable, such invalidity or unenforceability shall not affect
any other provision hereof and this plan shall be construed and enforced
as if such provision had not been included.
g.
Construction. The plan shall be construed in accordance with the
laws of the Commonwealth of Pennsylvania and with the applicable portions
of the Internal Revenue Code.
h.
Copies of Plan. This plan may be executed in any number of counterparts,
each of which shall be deemed as an original, and said counterparts
shall constitute but one and the same instrument that may be sufficiently
evidenced by any one counterpart.
i.
Interpretation. Wherever appropriate, words used in this plan in
the singular may include the plural or the plural may be read as singular,
and the masculine may include the feminine.