[Ord. 1992-3, 3/5/1992, § 1; as amended by Ord.
2002-2, 3/7/2002; by Ord. 2007-02, 3/1/2007, § 1; and by
Ord. 2009-02, 12/28/2009, §§ 1, 4]
The Employee Retirement Income Security Act of 1974, as the
same may be amended from time to time.
Except as otherwise defined in this plan, any of the aggregate
amounts, all equal in value, which are expected to be received under
different forms of payment computed using the following assumptions:
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Pre- and Post-Retirement Mortality
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1983 Group Mortality Table, (males rates only)
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Pre- and Post-Retirement Interest Rate
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6% compounded annually
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In no event shall a participant receive less than the actuarial
equivalent of his accrued benefit calculation as of the adoption date
of this amendment computed in accordance with the definition of actuarial
equivalent in effect on that date.
In the event this section is amended the actuarial equivalent
of a participant's accrued benefit on or after the date of change
shall be determined as the greater of the actuarial equivalent of
the participant's accrued benefit as of the date of change computed
on the old basis, or the actuarial equivalent of the accrued benefit
computed on the new basis.
The actuarial equivalent computation for a participant's
early retirement benefit shall equal the accrued benefit reduced by
5/9% for each of the first 60 months and 5/18% for each of the next
60 months that the early retirement benefit commences prior to the
normal retirement date.
A plan which is being funded annually at a level not lower
than the financial requirements of the pension plan pursuant to the
Act of December 18, 1984 (P.L. 1005, No. 205), known as the "Municipal
Pension Plan Funding Standard and Recovery Act."
The cost of living adjustment factor prescribed by the Secretary
of the Treasury under Code § 415(d) for year beginning after
December 31, 1987, applied to such items and in such manner as the
Secretary shall prescribe.
The age of a participant computed as of his last birthday.
January 1 of each year following the effective date of the
plan.
An unpaid, temporary cessation from active employment with
the employer pursuant to an established nondiscriminatory policy,
whether occasioned by illness, military service or any other reason.
An "authorized leave of absence" shall not cause a break in service.
The average of the compensation received by a participant
during the last five calendar year period prior to his retirement
date, death or termination of employment with the employer. If a participant
has less than five calendar years of service on his date of termination,
his average annual compensation will be based on his annual compensation
during his actual consecutive calendar years of service to his date
of termination.
The governing body of the employer.
A twelve-consecutive-month period during which the employee
does not complete more than 500 hours of service with the employer.
For participants in the plan, computation of each such period shall
be made by reference to the vesting computation period.
An employee shall not incur a one-year break in service for
the plan year in which he/she becomes a participant, dies or retires.
Solely for purposes of determining whether a participant incurs a
one-year break in service, hours of service shall be recognized for
an authorized leave of absence and a maternity and paternity leave.
The Internal Revenue Code of 1986, as amended or replaced
from time to time.
The total compensation received by an employee from the employer
which is subject to federal income tax as reported on Form W-2.
For purposes of the maximum benefit limitations of Code § 415 (§ 1-704, Subsection 4, § 1-705, Subsection 5, and § 1-704, Subsection 6), compensation shall include the participant's wages, salaries, fees for professional services and other amounts received for personal services actually rendered in the course of employment with an employer maintaining the plan (including, but not limited to, commissions paid to salesmen, compensation for services on the basis of a percentage of profits, commissions on insurance premiums, tips and bonuses paid during the limitation year. Compensation does not include: employer contributions to a qualified retirement plan, a nonqualified deferred compensation plan or a simplified employee pension plan; income received from the disposition of stock pursuant to the exercise of a qualified stock option; income realized upon the exercise of a nonqualified stock option or upon the lapse of substantial forfeiture provisions or nontransferability provisions on previously restricted property (as defined under Code § 83); premiums paid by the employer for group life insurance to the extent not includable in the participant's gross income; and employer contributions (whether or not under a salary reduction agreement), towards the purchase of a tax sheltered annuity contract (as described in Code § 403(B)).
For plan years beginning after December 31, 1988, compensation
in excess of $200,000 shall be disregarded. Such amount shall be adjusted
at the same time and in such manner as permitted under Code § 415(d).
In determining the compensation of a participant for purposes of this
limitation, the rules of Code § 414(g)(6) shall apply, except
in applying such rules, the term "family" shall include only the spouse
of the participant and any lineal descendants of the participant who
have not attained age 19 before the close of the hear. If, as a result
of the application of such rules the adjusted $200,000 limitation
is exceeded, then the limitation shall be prorated among the affected
individuals' compensation determined under this section prior
to the application of this limitation.
A participant's 55th birthday; provided, such participant
has completed at least 10 years of service.
Any person who is employed by the employer except those who
are members of a collective bargaining organization which has participated
in good faith negotiations with the employer concerning retirement
benefits.
Vernon Township and any successor entity which shall become
a party hereto by assuming the obligations of the plan with respect
to its employees or any predecessor entity which has maintained this
plan or any predecessor plan which has been restated or modified herein.
Each such entity shall have all the rights and obligations of the
employer with respect to its employees. Such assumption shall be in
writing and signed by the employer.
The date on which an employee first completes an hour of
service for the employer.
The date on which an employee first completes an hour of
service.
Any person who, with respect to this plan:
Exercises any discretionary authority or discretionary control
respecting management of such plan or exercises any authority or control
respecting management or disposition of its assets.
Renders investment advice for a fee or other compensation, direct
or indirect, with respect to any moneys or other property of such
plan, or has any authority or responsibility to do so.
Has any discretionary authority or discretionary responsibility
in the administration of the plan.
A person who has been a participant but has ceased to be
a participant for any reason. Any participant with a vested interest
who is no longer employed by the employer shall also be considered
a former participant.
An employee shall be credited with an hour of service for each
hour for which the employee is directly or indirectly paid, or entitled
to payment, by the employer or an affiliated employer for the performance
of duties and for each hour for which the employee is directly or
indirectly paid, or entitled to such payment, by the employer or an
affiliated employer for reasons other than for the performance of
duties irrespective of whether the employment relationship has terminated
(such as vacation, holidays, sickness, jury duty, disability, layoff,
military duty or leave of absence) during the applicable computation
period. These hours shall include overtime hours, but credit is required
to be given only for the hours actually worked irrespective of any
increase in the rate of pay for such hours.
An employee shall be credited with an hour of service for which
back pay has been awarded or agreed to by the employer. These hours
shall be credited to the employee for the period or periods to which
the award, agreement or payment pertains. The hours to be credited
will be determined without regard to the mitigation of damages for
reasons such as the employee's bad faith or receipt of compensation
from other sources during the period wrongfully not employed.
The number of an employee's hours of service and the plan
year or other computation period to which they are to be credited
shall be determined in accordance with §§ 2530.200(b)
and (c) of the Rules and Regulations for Minimum Standards for Employee
Pension Benefit Plans, which sections are herein incorporated by reference.
Notwithstanding the above:
No more than 501 hours of service are required to be credited
to an employee on account of any single continuous period during which
the employee performs no duties (whether or not such period occurs
in a single computation period);
An hour for which an employee is directly or indirectly paid,
or entitled to payment, on account of a period during which no duties
are performed is not required to be credited to the employee if such
payment is made or due under a plan maintained solely for the purpose
of complying with applicable worker's compensation, or unemployment
compensation or disability insurance laws; and
Hours of service are not required to be credited for a payment
which solely reimburses an employee for medical or medically related
expenses incurred by the employee.
A participant who is lawfully married on the date retirement
benefits become payable pursuant to § 6 of the plan.
An absence from work for maternity or paternity reasons:
by reason of pregnancy of the individual, by reason of a birth of
a child of the individual, by reason of the placement of a child with
the individual in connection with the adoption of such child by such
individual, or for purposes of caring for such child for a period
beginning immediately following such birth or placement. The hours
of service credited under this subsection shall be credited in the
computation period in which the absence begins if the crediting is
necessary to prevent a break in service in that period, or in all
other cases, in the following computation period. An individual who
is absent from work for maternity or paternity reasons shall receive
credit for the hours of service which would otherwise have been credited
to such individual but for such absence, or in any case in which such
hours cannot be determined, eight hours of service per day of such
absence. The total hours of service required to be credited for a
maternity or paternity leave of absence shall not exceed 501.
A participant's sixtieth birthday. A participant shall
have a 100% nonforfeitable vested interest in his accrued benefit
upon attainment of his normal retirement age.[1]
If any former participant is reemployed after a one-year
break in service has occurred, for the purpose of calculating his
years of service (for vesting) and his vested interest, the years
of service, and years of benefit service prior to a one-year break
in service subject to the following rules:
If a former participant has a one-year break in service, his
prebreak, and postbreak service shall be used for computing years
of service for vesting purposes only after he/she has been employed
for one year of service following the date of his reemployment with
the employer.
Each nonvested former participant will be considered a new employee and shall lose credits otherwise allowable in Subsection A above if his consecutive one-year breaks in service equal or exceed the greater of:
If a former participant completes one year of service following
his reemployment with the employer, he/she shall participate in the
plan retroactively to his date of reemployment.
If a former participant completes a year of service (a one-year
break in service previously occurred, but employment had not terminated),
he/she shall participate in the plan retroactively from the first
day of the plan year during which he/she completes one year of service.
Notwithstanding C above, a former participant will become a
participant immediately upon returning to the employ of the employer
if such former participant had a nonforfeitable right to all or any
portion of this accrued benefit at the time of his termination of
service.
Any employee who has satisfied the requirements to participate in this plan as provided for in § 1-702 and has not for any reason become ineligible to participate further in the plan.
The defined benefit pension plan set forth herein (including
any trust forming a part hereof), as amended and supplemented, from
time, all of which shall be known as the "Vernon Township Nonuniformed
Employees Pension Plan."
Each twelve-month period beginning on January 1 and ending
on the following December 31 (also applicable prior to the effective
date of the plan).
The date of actual retirement of a participant which may be his early, normal or late retirement date, whichever is applicable to him/her pursuant to § 1-705 of the plan.
A nonforfeitable benefit provided in the plan.
The plan year.
A computation period of a twelve-month period, as set forth
herein, during which an employee has at least 1,000 hours of service.
For purposes of determining an employee's vested interest,
an employee shall receive credit for a year of service if he/she renders
at least 1,000 hours of service during a vesting computation period.
For all other purposes, an employee shall receive credit for
a year of service if he/she renders at least 1,000 hours of service
during a plan year.
A participant shall be credited with a year of benefit service
for each twelvemonth period coinciding with the plan year in which
such participant renders 1,000 or more hours of service.
If the participant has received a single sum payment of his benefit pursuant to this plan, years of benefit service completed by the employee with respect to which the employee has received such payment shall be disregarded for purposes of determining the amount of the benefit to which the employee may become entitled following his reemployment unless they are restored in accordance with the provisions of § 1-708, Subsection 5.
Years of benefit service for which the employee was not considered
an eligible employee shall not be considered for the purpose of calculating
his benefit.
[Ord. 1992-3, 3/5/1992, § 2]
1.
Eligibility Requirements. Any employee who was a participant as of
the effective date of this amendment and restatement of the plan shall
continue to participate in the plan. Thereafter, any employee shall
participate on his entry date.
2.
Determination of Eligibility. The chief administrative officer shall
determine the eligibility of each employee for participation in the
plan based upon information furnished by the employer.
3.
Termination of Eligibility. A participant shall cease to participate
in the plan as of the first day of a plan year during which he/she
has a one-year break in service.
[Ord. 1992-3, 3/5/1992, § 3]
1.
Contributions by Employer.
A.
The employer shall contribute to the plan for investment at least
such amounts as are necessary to satisfy the minimum funding standards
of Act 205. The employer contribution shall consist of funds received
by the employer through Act 205 of the laws of the Commonwealth of
Pennsylvania (These funds must be contributed to the plan by the employer
within 31 days after receipt.) Contributions from the employer's
general fund with respect to a particular plan year must be paid to
the plan by the last day of January in the year of valuation. If the
contributions from the general fund are not paid by the last day of
January the outstanding contribution shall be payable with interest
for the period since January 1 at a rate equal to the interest assumption
used for the actuarial valuation report expressed on a monthly basis.
If the contribution remains outstanding after December 31 an additional
interest penalty compounded monthly will accrue until the payment
is made.
B.
The expenses of administering the plan may be paid directly by the
employer if it so elects. Otherwise such expenses shall be paid out
of the fund.
2.
Contributions by Employees - Compulsory Employee Contributions by
Participants. As a condition of participation in the plan, each employee
of the Township of Vernon, Crawford County, Pennsylvania, shall contribute
monthly an amount equal to 5% of the participant's monthly compensation.
The Township of Vernon, Crawford County, Pennsylvania, may, on an
annual basis, by ordinance or resolution, reduce or eliminate contributions
into the fund by participants. Reduction or elimination of participant
contributions shall not permit the return of contributions or any
interest of fund earnings to be made to a participant while still
a full-time employee.
[Added by Ord. No. 2018-01, 3/1/2018]
[Ord. 1992-3, 3/5/1992, § 4; as amended by Ord.
2000-1, 3/2/2000]
1.
Normal Retirement Benefit.
A.
The amount of monthly retirement benefit to be provided for each
participant who retires on his normal retirement date (which benefit
is herein called his "normal retirement benefit") shall be equal to
3% of his average annual compensation, multiplied by his number of
years of benefit service.
B.
Notwithstanding the above, each participant shall be provided with
a monthly retirement benefit of not less than $20.
3.
Relationship to Social Security. No change in the Social Security
Act after the date of a participant's separation from service
shall affect the benefits as described under this plan.
4.
Maximum Benefits.
A.
Subject to exceptions below, the maximum annual benefit payable to
a participant under this plan in any limitation year shall equal the
lesser of:
(1)
Ninety thousand dollars; or
(2)
One hundred percent of the participant's compensation averaged
over the three consecutive limitation years (or actual number of limitation
years for employees who have been employed for less than three consecutive
limitation years) during which the employee had the greatest aggregate
compensation from the employer.
B.
For purposes of this plan, "annual benefit" means the benefit which would be payable in the form of a straight life annuity with no ancillary benefit or a qualified joint and survivor annuity. If a benefit is payable in any other form, the annual benefit limitation shall be applied by adjusting it to the actuarial equivalent of a straight life annuity. In determining the actuarial equivalent value the interest rate assumption shall not exceed the greater of 5% of the rate specified in § 1-701, Subsection 3. No adjustment is required for qualified joint and survivor annuity benefits, preretirement death benefits and postretirement medical benefits.
C.
Preservation of Current Accrued Benefit under the Plan.
(1)
In general, this subsection shall apply to defined benefit plans
that were in existence on May 6, 1986, and that met the applicable
requirements of Code § 415 as in effect for all limitation
years.
(2)
If the current accrued benefit of an individual who is a participant
as of the first day of the limitation year beginning on or after January
1, 1987, exceeds the benefit limitations under Code Section 415(b),
then for purposes of Code Section 415(b) and (e), the defined benefit
dollar limitation with respect to such individual shall be equal to
such current accrued benefit.
(3)
"Current accrued benefit" shall mean a participant's accrued
benefit under the plan determined as if the participant had separated
from service as of the close of the last limitation year beginning
before January 1, 1987, when expressed as an annual benefit within
the meaning of Code Section 415(b)(2). In determining the amount of
a participant's current accrued benefit, the following shall
be disregarded:
(4)
The dollar limitation under Code § 415(b)(1)(A) stated in Subsection 4A(1) above shall be adjusted annually as provided in Code § 415(d) pursuant to the regulations. The adjusted limitation is effective as of January 1 of each calendar year and is applicable to limitation years ending with or within that calendar year.
(5)
The limitation stated in Subsection 4A(2) above for participants who have separated from service with a nonforfeitable right to an accrued benefit shall be adjusted annually as provided in Code § 415(d) pursuant to the regulations prescribed by the Secretary of the Treasury.
(6)
For purposes of § 1-704, Subsections 4 and 5, all defined benefit plans of the employer, whether or not terminated, are to be treated as one defined benefit plan and all defined contribution plans of the employer, whether or not terminated, are to be treated as one defined contribution plan of the employer.
(7)
In the case of a group of related employers all such employers
shall be considered a single employer for purposes of applying the
limitation of § 415 of the Code.
5.
Adjustments to Annual Benefit and Limitations.
A.
If the annual benefit begins on or after age 62, the $90,000 limit
shall not be reduced. If the annual benefit begins before age 62,
the $90,000 limitation (but not the 100% compensation limitation)
shall be reduced so that it is the actuarial equivalent of the $90,000
limitation beginning at age 62. However, the $90,000 limitation shall
not be reduced to less than:
(1)
Seventy-five thousand dollars if the annual benefit commences
on or after age 55; or
(2)
The amount which is the actuarial equivalent of $75,000 at age
55 if the annual benefit commences prior to age 55.
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For purposes of adjusting the $90,000 limitation applicable prior to age 62 or the $75,000 limitation prior to age 55 the adjustment shall be made pursuant to § 1-701, Subsection 3, except that the interest rate assumption shall be the greater of 5% or the rate specified in § 1-701, Subsection 3, and the mortality decrement shall be ignored to the extent that a forfeiture does not occur at death.
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B.
If the annual benefit begins after age 65 the $90,000 limitation shall be increased so that it is the actuarial equivalent of the $90,000 limitation at the participant's age 65. For purposes of adjusting the $90,000 limitation applicable after the participant's age 65 the adjustment shall be made pursuant to § 1-701, Subsection 3, except that the interest rate assumption shall be the lesser of 5% or the rate specified in § 1-701, Subsection 3, and the mortality decrement shall be ignored to the extent that a forfeiture does not occur at death.
D.
If a participant has less than 10 years of participation in the plan
at the time he/she begins to receive benefits under the plan, the
$90,000 limitation shall be reduced by multiplying such limitation
by a fraction; (1) the numerator of which is the number of years of
participation (or part thereof) in the plan; and (2) the denominator
of which is 10; provided, that said fraction shall in no event be
less than 1/10. The 100% of compensation limitation shall be reduced
in the same manner except the preceding sentence shall be applied
with respective years of service with the employer rather than years
of participation in the plan. Additionally, to the extent provided
in regulations, the above reductions shall be applied separately with
respect to each change in the benefit structure of the plan. Notwithstanding
the foregoing, for limitation years beginning prior to January 1,
1987, if a participant has fewer than 10 years of service with the
employer at the time he/she begins to receive benefits under the plan,
the maximum annual benefit payable to the retired participant shall
be reduced by multiplying such maximum annual benefit by a fraction:
the numerator of which is the number of years of service, or part
thereof, with the employer, and the denominator of which is 10.
E.
Exception Benefit. Subject to the limitation of § 1-704, Subsection 5D, above, this plan may pay an annual benefit to any retired participant which shall exceed 100% of such participant's average compensation (§ 1-704, Subsection 4, above); provided, the annual benefit shall not be in excess of $10,000; and, provided, the participant shall not be or have been, at any time, an active participant in any defined contribution plan maintained by the employer.
6.
Multiple Plan Reduction.
A.
If an employee has at any time participated in one or more defined
benefit plans and one or more defined contribution plans maintained
by the employer, the sum of the defined benefit plan fractions and
the defined contribution plan fraction for any limitation year may
not exceed one. 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 this section shall not cause
the maximum permissible amount for such individual under all such
defined benefit plans to be less than the individual's current
accrued benefit. The preceding sentence applies only if such defined
benefit plans met the requirements of Code § 415 for all
limitation years beginning before January 2, 1987.
(1)
The defined benefit plan fraction for any limitation year is
a fraction, the numerator of which is the participant's projected
annual benefit under the plan (determined as of the close of the limitation
year pursuant to Regulations 1.415-7(3)), and the denominator of which
is the lesser of: ((a) the product of 1.25 multiplied by the dollar
limitation in effect under Code § 415(c)(1)(A) for such
year (determined without regard to Code § 415(c)(6), or
(2) the product of 1.4 multiplied by the amount which may be taken
into account under Code § 415(c)(1)(B) for such year. For
the purpose of this subsection, the term "participant's account"
shall mean the account established and maintained for each participant
with respect to his total interest in the defined contribution plan
maintained by the employer resulting from annual additions. The annual
addition allocated to pay any participant's account under this
plan in a limitation year, plus all annual additions allocated to
such participant under any other defined contribution plan of the
employer for such limitation year shall not exceed the lesser of (2)
$30,000 (or such greater amount as may be determined by the Commissioner
of Internal Revenue Service for limitation years ending on or after
January 1, 1988, as a cost of living adjustment), or (b) 25% of such
participant's compensation. "Annual additions" means the sum
credited to a participant's account for any limitation year of:
(a)
Employer contributions.
(b)
Employee contributions.
(c)
Forfeitures.
(d)
Amounts allocated after March 31, 1984, to any individual medical
account, as defined in Code § 415(1)(2) which is part of
a pension or annuity plan maintained by the employer.
(e)
Amounts derived from contributions paid or accrued after December
31, 1985, in taxable years ending after such date which are attributable
to postretirement medical benefits allocated to a separate account
of a key employee (as defined in Code § 419A(d)(3)) under
a welfare benefit plan (as defined in Code § 419(e)) maintained
by the employer.
(2)
Notwithstanding the foregoing, for plan years beginning prior
to January 1, 1987, only that portion of employee contributions equal
to the lesser of employee contributions in excess of 6% of compensation
or 1/2 of employee contributions shall be considered an annual addition.
(3)
The annual addition for any limitation year beginning before
January 1, 1987, shall not be recomputed to treat all employee contributions
as an annual addition.
(4)
If the plan satisfied Code § 415 as in effect for
all limitation years beginning before January 1, 1987, an amount shall
be subtracted from the numerator of the defined contribution plan
fraction (not exceeding such numerator) as prescribed by the Secretary
of the Treasury so that the sum of the defined benefit plan fraction
and defined contribution plan fraction computed under § 415(e)(1),
as amended by the Tax Reform Act of 1986, does not exceed one for
such limitation year.
B.
Except as specifically permitted in the regulations of the Secretary
of the Treasury under § 415 of the Code, the benefits paid
or payable at any time shall not exceed the limitations of Subsection
6A above.
C.
Special Rule For Defined Contribution Fraction for Defined Contribution
Plan in Effect on or Before July 1, 1982. The administrator may elect,
for any limitation year ending after December 31, 1982, that the amount
taken into account in the denominator for every participant for all
limitation years ending before January 1, 1983, shall be an amount
equal to the product of:
(1)
The denominator for the limitation year ending in 1982 determined
under the law in effect for the limitation year ending in 1982 multiplied
by
(2)
The transition fraction.
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For purposes of the preceding subsection, the term "transition
fraction" shall mean a fraction;
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(1)
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The numerator of which is the lesser of:
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(a)
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$51,875; or
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(b)
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1.4 multiplied by 25% of the participant's compensation
for the limitation year ending in 1981, and
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(2)
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The denominator of which is the lesser of:
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(a)
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$41,500; or
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(b)
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25% of the participant's compensation for the limitation
year ending in 1981.
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Notwithstanding the foregoing, for any limitation year in which the plan is a top heavy plan, $41,500 shall be substituted for $51,875 in determining the transition fraction unless the extra minimum benefit is provided pursuant to § 1-709, Subsection 9. However, for any limitation year in which this plan is a top heavy plan, $41,500 shall be substituted for $51,875 in any event.
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D.
If the sum of the defined benefit plan fraction and the defined contribution
plan fraction shall exceed one in any limitation year for any participant
in the plan, for reason other than those described in Subsection 6E
below, the administrator shall adjust the numerator of the defined
benefit plan fraction so that the sum of both fractions shall not
exceed one in any limitation year for such participant.
E.
If the substitution of one for 1.25 and $41,500 for $51,975 above
or the excess benefit accruals or annual additions provided for in
Internal Revenue Notice 82-19 cause the one limitation to be exceeded
for any participant in any limitation year, such participant shall
be subject to the following restrictions for each future limitation
year until the one limitation is satisfied:
[Ord. 1992-3, 3/5/1992, § 5; as amended by Ord.
2007-02, 3/1/2007, § 2; and by Ord. 2009-02, 12/28/2009,
§ 2]
1.
Normal Retirement. Each participant who retires from the employment of the employer on the first day of the calendar year coincident with or next following his or her sixtieth birthday (normal retirement date) shall be entitled to receive the benefits as provided in § 1-704, Subsection 1, of this Part.
2.
Early Retirement.
B.
Each participant who desires to retire at a date earlier than his normal retirement date, in accordance with § 1-705, Subsection 2A, shall notify the employer and the committee by written notice setting forth his retirement date; such notice to be given no less than 60 days prior to said participant's early retirement date.
3.
Late Retirement. A participant who remains in the employ of the employer after his normal retirement date shall continue to be a participant in the plan until his actual retirement date (late retirement date) and shall be entitled to receive the benefit provided for in § 1-706, Subsection 3. A participant will be deemed to be retired as of the first day of any calendar month after he/she attains his normal retirement date during which he/she performs services for the employer and/or receives payment for vacation, holiday, illness, incapacity during disability, layoff, jury duty, military duty, or leave of absence for fewer than 40 hours of employment. If a participant makes such election, he/she shall waive future participation in the plan and shall not accrue any additional benefits under the terms of the plan.
4.
Reemployment after Retirement. If a participant who is receiving benefits hereunder returns to the employer, his benefits hereunder shall cease for so long as he/she continues to be employed. Upon such participant's subsequent retirement his benefit shall be recalculated, based upon his years of service prior and subsequent to such return to employment and his then attained age, and reduced on an actuarial basis to take account of benefit payments previously received by him/her. This § 1-705, Subsection 4, and the administration thereof, shall be subject to the requirements of Regulation 2530.203-3 of the U.S. Department of Labor, when such regulation becomes final, or other final comparable regulation or regulations.
[Ord. 1992-3, 3/5/1992, § 6]
1.
2.
Early Retirement Pension. A participant who retires on an early retirement
date may elect to receive one of the following:
B.
Commencing on his early retirement date, or on the first day of any
month thereafter, as selected by the participant, but not later than
his normal retirement date, the retirement income described in the
preceding subsection monthly benefit described in the preceding Subsection
2A reduced to its actuarial equivalent value as of his early retirement
date.
3.
Late Retirement Pension. A participant who remains in the employ of the employer beyond his normal retirement date shall be entitled to receive, commencing on his late retirement date, his benefit calculated pursuant to § 1-704, Subsection 1, considering his years of credited service and his average monthly salary as of his late retirement date.
4.
Distribution of Benefits.
A.
Unless otherwise elected as provided below, a participant who is
married on the annuity starting date and who does not die before the
annuity starting date shall receive the value of his benefits in the
form of a joint and survivor annuity. The joint and survivor annuity
is an annuity that commences immediately and shall be the actuarial
equivalent of the amount of benefit payable under the normal form
of benefit. Such joint and survivor benefits following the participant's
death shall continue to the surviving spouse during the spouse's
lifetime at a rate equal to 50% of the rate at which such benefits
were payable to the participant. An unmarried participant shall receive
the value of his benefits payable in the form of a life annuity. Such
life annuity shall be the actuarial equivalent of the amount of benefit
payable under the normal form of benefit. An unmarried participant,
however, may elect in writing to waive the life of annuity form of
benefit. The election must comply with the provisions of this section
as if it were an election to waive the joint and survivor annuity
by a married participant, but without the spousal consent requirement.
B.
Any election to waive the joint and survivor annuity must be made
by a participant in writing during the election period and be consented
to by the participant's spouse. If the spouse is legally incompetent
to give consent, the spouse's legal guardian, even if such guardian
is the participant, may give consent. Such election shall designate
a beneficiary (or a form of benefits) that may not be changed without
spousal consent (unless the consent of the spouse expressly permits
designations by the participant without the requirement of further
consent of the spouse). Such spouse's consent must acknowledge
the effect of such election and be witnessed by a plan representative
or a notary public. Such consent shall not be required if it is established
to the satisfaction of the administrator that the required consent
cannot be obtained because there is no spouse, the spouse cannot be
located or other circumstances that may be prescribed by Treasury
regulations. The election made by the participant and consented to
by his spouse may be revoked by the participant in writing without
the consent of the spouse at any time during the election period.
Any new election must comply with the requirements of this subsection.
Such election and revocation may be made any number of times. A former
spouse's waiver shall not be binding on a new spouse.
C.
The election period to waive the joint and survivor annuity shall
be the ninety-day period ending on the annuity starting date.
D.
For purposes of this section, the annuity starting date means the
first day of the first period for which an amount is payable as an
annuity (whether by reason of retirement or disability), or in the
case of a benefit not payable in the form of an annuity, the first
day on which all events have occurred which entitle the participant
to such benefit.
E.
With regard to the election, the administrator shall provide the
participant, no less than 30 days and no more than 90 days before
the annuity starting date, a written explanation of:
(1)
The terms and conditions of the joint and survivor annuity.
(2)
The participant's right to make an election to waive the
joint and survivor annuity.
(3)
The right of the participant's spouse to consent to any
election to waive the joint and survivor annuity.
(4)
The right of the participant to revoke such election and the
effect of such revocation.
F.
In the event a participant duly elects pursuant to Subsection 4B above not to receive the retirement benefit in the form of a joint and survivor annuity, or if such participant is not married, in the normal form of benefit as provided for in § 1-704, Subsection 2, the Administrator shall direct the trustees to distribute to a participant or his beneficiary any amount to which he/she is entitled under the plan in one or more of the following methods as elected by the participant:
(1)
Life Annuity. A participant may elect to receive a monthly pension
commencing on his retirement date and continuing for life (normal
form for unmarried participants).
(2)
Months Certainty and Life Annuity. A participant may elect to
receive an actuarial equivalent pension payable for life, with a stipulation
that should he/she die prior to receiving 120 monthly payments, the
balance of such payments shall continue to be paid to his designated
beneficiaries (or if none, to his estate).
(3)
Joint and Survivor Annuity. A married participant may elect
to receive an actuarial equivalent pension for life with payments
continuing after his death to a designated beneficiary for the continued
lifetime of such designated beneficiary equal to 100% of the reduced
pension payable to him/her.
|
Such optional forms of payment shall be actuarial equivalents
of the amount of benefit the participant and his beneficiary were
entitled to under the plan.
|
G.
Any distribution to a participant shall require such participant's
consent if such distribution commences prior to the later of his normal
retirement age or age 62. With regard to this required consent:
(1)
No consent shall be valid unless the participant has received
a general description of the material features and an explanation
of the relative values of the optional forms of benefit available
under the plan that would satisfy the notice requirements of Code
§ 417.
(2)
The participant must be informed of his right to defer receipt of the distribution. If a participant fails to consent, it shall be deemed an election to defer the commencement of payment of any benefit. However, any election to defer the receipt of benefits shall not apply with respect to distributions which are required under § 1-706, Subsection 4I.
(3)
Notice of the rights specified under this subsection shall be
provided no less than 30 days and no more than 90 days before the
annuity starting date.
(4)
Written consent of the participant to the distribution must
not be made before the participant receives the notice and must be
made more than 90 days before the annuity starting date.
(5)
No consent shall be valid if a significant detriment is imposed
under the plan on any participant who does not consent to the distribution.
H.
The amount of the participant's balance to be distributed each
year must be at least an amount equal to the quotient obtained by
dividing the participant's entire interest by the life expectancy
of the participant and his designated beneficiary.
I.
Notwithstanding any provision in this plan to be contrary, the distribution
of a participant's benefits shall be made in accordance with
the following requirements and shall otherwise comply with Code § 401(a)(9)
and the regulations thereunder (including Regulation § 1.401(a)(9)-2)):
(1)
A participant's benefits shall be distributed to him/her
not later than April 1 of the calendar year following the later of:
(a)
The calendar year in which the participant attains age 70 1/2;
or
(b)
The calendar year in which the participant retires.
|
Alternatively, distributions to a participant must begin no
later than the applicable April 1 as determined under the preceding
sentence and must be made over a period not exceeding the life of
the participant (or the lives of the participant and the participant's
designated beneficiary) or the life expectancy of the participant
(or the life expectancies of the participant and his designated beneficiary)
in accordance with regulations.
|
(2)
Distributions to a participant and his beneficiaries shall only
be made in accordance with the incidental death benefit requirements
of Code § 401(a)(9)(G) and the regulations thereunder. Additionally,
for calendar years beginning before 1989, distributions may also be
made under an alternative method which provides that the then present
value of the payments to be made over the period the participant's
life expectancy exceeds 50% of the then present value of the total
payments to be made to the participant and his beneficiaries.
J.
For purposes of this section, at the participant's election,
the life expectancy of the participant and a participant's spouse
(other than in the case of a life annuity) may be redetermined, but
not more frequently than annually, and in accordance with such rules
as may be prescribed by Treasury regulations. Further, life expectancy
and joint and last survivor expectancy shall be computed using the
return multiples of Regulations 1.72-9.
5.
Time of Payment of Benefits.
A.
Unless elected otherwise as provided in Subsection 5B of this section,
payment of benefits must begin no later than 60 days after the close
of the plan year in which the latest of the following events occurs:
6.
Preretirement Survivor Annuity Benefit for Married Participants.
A.
If a married participant dies on or after his earliest retirement
age, and such participant has been married for the one-year period
ending on the date of his death, the participant's surviving
spouse (if any) will receive the same benefit that would be payable
if the participant had retired with an immediate preretirement survivor
annuity on the day before the participant's date of death.
B.
The term "earliest retirement age" means the earliest date on which,
under the plan, the participant could elect to receive retirement
benefits.
C.
The term "preretirement survivor annuity" means an annuity payable
for the lifetime of the surviving spouse in an amount equal to 50%
of the monthly retirement benefit that would have been otherwise payable
to the participant had he/she retired and elected an immediate joint
and 50% survivor annuity actuarially reduced for early commencement.
D.
The provisions of this section shall also apply to any former participants
who are credited with an hour of service after August 23, 1984, and
terminate thereafter.
E.
An immediate distribution of the entire amount may be made to the surviving spouse; provided, such surviving spouse consents in writing to such distribution. Any written consent required under this subsection must be obtained not more than 90 days before the commencement of the distribution and shall be made in a manner consistent with § 1-706, Subsection 4.
F.
The distribution of a preretirement survivor annuity to the participant's
surviving spouse must commence on or before the later of:
7.
Limitation on Benefits.
A.
All rights and benefits, including elections, provided to a participant
in this plan shall be subject to the rights afforded to an alternate
payee under a qualified domestic relations order as those terms are
defined in Code § 414(p).
B.
Notwithstanding the other requirements of this section the respective
notices prescribed by this section need not be given to a participant
if the plan fully subsidizes the costs of a qualified joint and survivor
annuity or preretirement survivor annuity. A plan fully subsidizes
the cost of a benefit if under the plan the failure to waive such
benefit by a participant would not result in a decrease in any plan
benefit with respect to such participant and would not result in increased
contributions from the participant.
[Ord. 1992-3, 3/5/1992, § 7]
2.
Beneficiary Designation. Each participant shall designate to the chief administrative officer a beneficiary to receive death benefits provided under any payment option chosen in § 1-706 and shall also designate the mode or method of payment of the death benefit. Such designation may be changed, from time to time, prior to the commencement of retirement benefits by the participant filing a new designation with the chief administrative officer; however, no such change of beneficiary shall be effective until it is received by the chief administrative officer. The participant may designate any beneficiary to receive the remaining benefits payable, except the preretirement survivor annuity (unless another option is elected). In the absence of a designation, the beneficiary of a participant shall be his spouse, if surviving; otherwise, his personal representative, if any, and if none, those persons entitled to his estate under the intestate laws of the state in which the participant resides. In no event shall any portion of the death benefit be made to the employer.
3.
Distribution for Minor Beneficiary. In the event a distribution is
to be made to a minor, then the chief administrative officer shall
direct that such distribution be paid to the legal guardian, or if
none, to a parent of such beneficiary or a responsible adult with
whom the beneficiary maintains his residence, or to the custodian
for such beneficiary under the Uniform Gift to Minors Act or Gift
to Minors Act, if such is permitted by the laws of the state in which
said beneficiary resides. Such a payment to the legal guardian or
parent of a minor beneficiary shall fully discharge the trustee, employer
and plan from liability on account thereof.
[Ord. 1992-3, 3/5/1992, § 8; as amended by Ord.
2007-02, 3/1/2007, § 3; and by Ord. 2009-02, 12/28/2009,
§ 3]
1.
Deferred Vested Benefits. Participants will be vested in a percentage
of their accrued benefits attributable to employer contributions if
they terminate their employment for causes other than death prior
to their normal or early retirement dates. Such participants shall
be vested in a percentage of their accrued benefit as determined in
accordance with the following table:
|
Years of Credited Service
|
Vesting %
|
|---|---|
|
Less than 4
|
0%
|
|
4
|
40%
|
|
5
|
50%
|
|
6
|
60%
|
|
7
|
70%
|
|
8
|
80%
|
|
9
|
90%
|
|
10 or more
|
100%
|
2.
Forfeitures. Upon the forfeiture of an nonvested portion of a participant's accrued benefit by reason of a break in service with the employer without a fully vested interest in such accrued benefit, the amount of such forfeiture shall be credited against the future contributions of the employer under the plan as provided under § 1-703, Subsection 1.
3.
Amendment of Vesting Schedule. A participant's vested interest
in his accrued benefit shall not be reduced as the result of any direct
or indirect amendment to this section. In the event that this plan
is amended to change or modify this section, a participant with at
least five years at service of the expiration date of the election
period may elect to be subject to the preamendment vesting schedule.
For plan years beginning after December 31, 1988, three shall be substituted
for five in the preceding sentence, if a participant fails to make
such election, then such participant shall be subject to the new vesting
schedule. The participant's election period shall commence on
the adoption date of the amendment and shall end 60 days after the
latest of:
4.
Time of Payment.
A.
When a participant has incurred a one-year break in service, his participation in the plan shall cease. Payment to a former participant of the vested portion of his accrued benefit (determined in accordance with § 1-708, Subsection 1), unless he/she otherwise elects, shall begin not later than the 60th day after the close of the plan year in which the latest of the following events occurs:
C.
However, in all other instances, the terminated participant shall
not be entitled to receive his deferred vested benefit until his normal
retirement date.
[Ord. 1992-3, 3/5/1992, § 9]
1.
Chief Administrative Officer.
A.
The administration of this plan shall be vested in the chief administrative
officer, who shall have the power and duty to operate and administer
the provisions of the plan and to make and enforce such rules and
regulations as may be necessary and proper for the efficient administration
of the plan.
B.
The chief administrative officer shall be appointed by the employer
and may, but need not, be one of the participants. The chief administrative
officer may be removed by the employer or may resign by delivering
his written resignation to the employer.
C.
The chief administrative officer may appoint such subcommittees with
such powers as he/she determines; and may employ counsel and agents
and such clerical, accounting and actuarial services as he/she may
require in carrying out the provisions of the plan. All expenses incurred
in administering this plan shall be paid by the employer.
D.
The chief administrative officer shall not be liable for any loss
other than that specifically provided for under the standards applicable
to fiduciaries as contained in the Act. He/she shall not be personally
liable upon, or with respect to, any agreement, act, transaction or
omission executed committed, or suffered to be committed by himself,
or by any other agent or representative, except as specifically provided
in Title I of the Act. The chief administrative officer, and any agent
thereof, shall be fully protected in relying upon the advice of any
legal counsel, physician or other expert retained by him/her or by
the employer. Other than the bonding requirement under § 412
of the Act, no bond or other security shall be required of the chief
administrative officer in any jurisdiction.
E.
The chief administrative officer shall have the power to determine the eligibility of any employee to participate in or receive benefits under this plan, to settle any disputes which may arise in the operation of the plan, to determine the interest of any participant in the plan, to value the assets held in the plan on the basis of their market value in such manner as he/she may deem appropriate, and to interpret any provisions of this plan. Any such determination, decision or interpretation of the chief administrative officer shall be conclusive as to all persons affected thereby subject only to the right of review provided by § 1-709, Subsection 1H, hereunder.
F.
The chief administrative officer shall make all distributions hereunder.
The chief administrative officer may, to the extent not inconsistent
with the plan, specify the time at which any such distribution shall
be made and may make such distribution in cash, in property, in annuity,
insurance or similar contracts having such provisions as he/she may
deem appropriate in the form of periodic payments, or any combination
of the foregoing.
G.
All discretionary acts which may be taken pursuant to this plan by
the chief administrative officer with respect to participants or their
beneficiaries shall be uniform and nondiscriminatory and shall be
applicable to all participants and their beneficiaries in substantially
identical situations.
H.
Any claims by a participant or beneficiary shall be filed in writing
with the chief administrative officer. Any decision by the chief administrative
officer denying a claim by a participant or a beneficiary for benefits
under the plan shall be communicated in writing to the participant
or beneficiary, setting forth the specific reasons for such denial.
Any such participant or beneficiary whose claim has been denied, or
his duly authorized representative, may (1) appeal to the Pension
Board appointed by the Board of Supervisors in writing within 90 days
after receipt of the notice of denial for a full review of the decision
by the Board; (2) review pertinent documents; and (3) submit issues
and comments in writing. The decision by the Board following such
review shall be made no later than 60 days after the date of receipt
by the Board of the request for review, and shall be conclusive as
to all persons affected thereby. Such decision shall be in writing
and shall include both specific reasons for the decision, written
in a manner calculated to be understood by the claimant, and specific
references to the pertinent plan provisions on which the decision
is based.
I.
The chief administrative officer shall hold and invest the contributions
in accordance with the instructions of the employer.
J.
The plan shall be used to pay benefits as provided and, to the extent
not paid directly by the employer, to pay the expenses of administering
the plan pursuant to authorization by the chief administrative officer.
K.
The employer intends the plan to be permanent and for the exclusive
benefit of its employees. It expects to make the contributions required
under the plan. However, subject to the provisions of the Act, neither
the employer, nor the chief administrative officer shall be liable
in any manner for any insufficiency in the plan. Benefits are payable
only from the plan, and only to the extent that there are monies available
therein.
L.
The chief administrative officer shall be the named fiduciary with
respect to the management and control of the assets in the plan, and
may appoint an investment manager or managers to manage any assets
of the plan, including the power to acquire and dispose of any plan
assets.
[Ord. 1992-3, 3/5/1992, § 10]
1.
Amendment and Termination. The employer shall have the right to amend
or terminate this plan at any time; provided, however, that no such
action shall be effective to permit any part of the corpus or income
of the plan established in connection herewith to be used for, or
diverted to, purposes other than the exclusive benefit of the participants
and their beneficiaries, and defraying the reasonable expenses of
administering the plan. The employer retains the right to amend, suspend
or terminate the plan at any time. Except as permitted by regulations
(including Regulation 1.411(d)-4), no plan amendment or transaction
having the effect of a plan amendment (such as a merger, plan transfer
or similar transaction) shall be effective if it eliminates or reduces
a Code § 411(d)(6) protected benefit or adds or modifies
conditions relating to Code § 411(d)(6) protected benefits,
the result of which is a further restriction on such benefit unless
such protected benefits are preserved with respect to benefits accrued
as of the later of the adoption date or effective date of the amendment.
Code § 411(d)(6) protected benefits are benefits described
in Code § 411(d)(6)(A), early retirement benefits and retirement-type
subsidies, and optional forms of benefits.
2.
Return of Employer Contributions.
A.
Except as hereinbefore and hereinafter provided, the assets of the
plan, including all contributions under the plan, shall never inure
to the benefit of the employer and shall be held for the exclusive
purposes of providing benefits to the participants and their beneficiaries,
and defraying the reasonable expenses of administering the plan.
B.
In the event that any contributions should be made by the employer
hereunder by a mistake of fact, the chief administrative officer shall,
at the direction of the employer, return such contribution to the
employer within one year after the date of payment of the contribution.
[Ord. 1992-3, 3/5/1992, § 11]
In the event of the termination or partial termination of the plan, the accrued benefit of each affected participant shall become fully vested and shall not thereafter be subject to the forfeiture. The Chief Administrative Officer shall allocate all benefits accrued for the affected participants and their beneficiaries to the date of such termination or partial termination, to the extent funded on such date, among such participants and beneficiaries in accordance with the provisions of § 4044 of the Act. The employer shall thereupon direct the chief administrative officer to immediately distribute the allocated amounts to the appropriate participants or beneficiaries, subject to the provisions of § 1-706, Subsection 5. In the event of the termination of the plan, any residual assets held as part of the plan, in excess of the present value of affected participant's accrued benefits that are the result of an actuarial error, shall be returned to the employer.
[Ord. 1992-3, 3/5/1992, § 12]
1.
Applicable Law. The plan shall be governed by, and construed in accordance
with, the laws of the state in which such documents have been executed
except to the extent that such laws have been specifically preempted
by the Act or other federal legislation.
2.
Incapacity of Recipient of Benefits. If any person entitled to receive
benefits shall be physically or mentally incapable of receiving or
acknowledging receipt of any payment of benefits, the chief administrative
officer, upon the receipt of satisfactory evidence that such incapacitated
person is so incapacitated and that another person or institution
is maintaining him/her and that no guardian or committee has been
appointed for him/her, may provide for the payment of benefits hereunder
to such person or institution so maintaining him/her, and any such
payments so made shall be deemed for every purpose to have been made
to such incapacitated person.
3.
Employment Rights not Affected by the Plan. Participation in this
plan shall not give any right to any employee to be retained in the
employ of the employer nor shall it interfere with the right of the
employer to discharge any employee and to deal with him/her without
regard to the existence of this plan and without regard to the effect
that such treatment might have upon him/her as a participant in this
plan.
4.
Ownership of Plan Assets. Nothing contained herein shall be deemed
to give any participant or his beneficiary any interest in any specific
property of the plan or any right except to receive such distributions
as are expressly provided for in this plan.
5.
Alienation of Benefits and Qualified Domestic Relations Orders.
A.
Subject to the exceptions provided below, no benefit which shall
be payable out of the plan to any person (including a participant
or his beneficiary) shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or charge.
Any attempt to anticipate, alienate, sell, transfer, assign, pledge,
encumber or charge the same shall be void. Also, no such benefit shall
in any manner be liable for, or subject to, the debts, contracts,
liabilities, engagements, or torts of any such person, nor shall it
be subject to attachment or legal process for or against such person,
and the same shall not be recognized by the chief administrative officer,
except to such extent as may be required by law.
B.
This provision shall not apply to the extent a participant or beneficiary is indebted to the plan, for any reason, under any provisions of this agreement. At the time a distribution is to be made to or for a participant's or beneficiary's benefit, such proportion of the amount distributed equal to such indebtedness shall be paid by the chief administrative officer, to apply against or discharge such indebtedness. Prior to making a payment, however, the participant or beneficiary must be given written notice by the chief administrative officer that such indebtedness is to be so paid in whole or part from his participant's accrued benefits. If the participant or beneficiary does not agree that the indebtedness is a valid claim against his vested accrued benefit, he/she shall be entitled to a review of the validity of the claim in accordance with the procedures provided in § 1-709, Subsection 1.
6.
Indemnification of Fiduciaries. To the extent permitted by the Act
and regulations issued thereunder, the employer shall indemnify and
hold harmless all fiduciaries of the plan, as defined in the Act,
who are employees of the employer, whether or not named fiduciaries,
and defend the same, against an and all claims or liabilities which
may be asserted against any of them by reason of any action or omission
in the administration of the plan, except in the case of any fraud
or willful wrongdoing.
8.
Meaning of Certain Words. As used herein each gender shall include
all other genders and the singular shall include the plural, and the
plural shall include the singular in all cases where such meaning
would be appropriate.
9.
Information to be Furnished by the Employer. The employer shall furnish
to the chief administrative officer such information in the employer's
possession as the chief administrative officer shall require, from
time to time, to perform their duties under the plan and the agreement
of trust.
10.
Service of Process. The chief administrative officer is the designated
agent of the plan for the service of process in connection with all
matters affecting the plan.
