[Adopted by Res. No. 6-4-1986B; amended in its entirety 12-1-2021 by Ord. No. 2021-11]
A pension plan is hereby established for the Township's
full-time nonuniformed employees pursuant to and in compliance with
the Act of May 1, 1933, P.L. 103, No. 69, as amended. Such plan shall
be under the direction of the Board of Supervisors of the Township
of East Hempfield and shall be administered under such regulations
as the Board of Supervisors may prescribe. The effective date of this
article, generally, shall be January 1, 2007; however, the plan established
hereunder shall be deemed a continuation of the previous nonuniformed
pension plan for state aid purposes. In addition, revisions made subsequent
to such effective date are separately identified.
As used in this article, the following terms shall have the
meanings indicated:
BOARD OF SUPERVISORS
The governing body of the Township of East Hempfield acting
in the capacity of administrator of the nonuniformed pension plan
established pursuant to this article.
COMMITTEE
The persons which may be appointed to serve in an advisory
capacity to the Board of Supervisors in the administration of the
plan.
CONTRIBUTION
The monies paid by the employer to the plan and/or the payroll deductions made monthly from the salaries of the participants and paid to the plan; except that contributions' in §
37-4E shall mean total contributions paid by the participant and accumulated during the period of employment and participation in this plan.
EMPLOYER
The Township of East Hempfield.
FUTURE SERVICE LIABILITY
The value of any participant's benefits which shall
accrue by virtue of that participant's service rendered subsequent
to the enactment of this article.
PARTICIPANT
Every person duly appointed from time to time by the employer
as a full-time nonuniformed employee working not less than 37 hours
per week at a definite salary, subject to reasonable vacation and
sick leave, to be included in the plan upon date of hire.
PLAN
The nonuniformed employees pension plan established pursuant
to this article.
SALARY
The amount of compensation received by a participant in each
and every month, including base pay, overtime pay, longevity pay,
shift differential, and any other such increments. The term "salary"
shall include regular payments made for vacation time, sick time,
compensation time, personal days and bereavement leave. For current
employees hired before January 1, 2007, the term "salary" shall also
include lump-sum payments made for any unused vacation days and/or
hours up to a maximum of one year's worth of such time and any
unused sick days and/or hours up to a maximum of three years'
worth of such time, as paid at the conclusion of employment at the
prevailing rate. For employees hired on or after January 1, 2007,
the term "salary" shall not include lump-sum payments made for any
unused days.
SERVICE
Total aggregate service, not necessarily continuous, with
the employer.
TERMINATION
The cessation of service by the participant for any reason,
including disability, resignation, and employee termination. Death
shall not be considered a termination within the meaning of this article.
Voluntary leaves of absence without pay shall not be considered a
termination for the purposes of this article, but no period of such
leave shall be computed in the total service for pension benefit purposes.
Leaves of absence with pay shall not be considered a termination within
the meaning of this article (provided that the municipality is able
to certify to the Department of the Auditor General that such participant
on a leave of absence with pay is within the definition of a participant
as set forth herein), but such leaves may be computed in the total
service for pension benefit purposes.
UNFUNDED LIABILITY
The present value of any participant's benefits accrued
prior to the enactment of this article by virtue of that participant's
prior service.
Any participant in the plan with at least six months of service
with the employer who thereafter shall enter the military service
of the United States of America shall have credited to the participant's
employment record for pension benefit purposes all of the time spent
by the participant in such military service, provided that the participant
returns to service with the employer within six months after said
participant's separation from such military service.
Upon termination of the plan, the assets shall be distributed
as follows:
A. Sufficient funds shall be maintained to provide the pension benefits prescribed in §
37-4 for all participants who have retired prior to the termination of the plan or who are eligible to retire at the time of the termination of the plan.
B. Sufficient funds shall be maintained to provide vested pension benefits prescribed in §
37-4 for all participants who are eligible for such benefits.
C. Any funds representing contributions from the remaining participants
shall be returned to such participants with interest at a rate of
6% per annum.
D. Of the remaining funds, those which can be identified as contributions
of the employer, or contributions other than those identified as unused
commonwealth allocations, shall be distributed as the Board of Supervisors
sees fit, provided that such distribution is made on a uniform basis.
E. All funds in excess of the funds described in Subsections
A,
B,
C and
D above shall be returned to the commonwealth as unused funds pursuant to the Act of May 12, 1943, P.L. 259, No. 120, as amended, 72 P.S. 2263.1 et seq.
All investments by the Board of Supervisors of the assets of
this plan shall comply with any applicable state statutes, rules and
regulations with respect to municipal investments for nonuniformed
pension funds and with such regulations as the Board of Supervisors
shall establish for the purpose of investing such funds.
The Board of Supervisors reserves the right to amend, at any time, in whole or in part, any or all of the provisions of the plan, provided that no such amendment shall authorize or permit any part of the plan to be used or diverted to purposes other than for the exclusive benefit of the participants, their beneficiaries, or their estates. Nor shall any amendment divest a participant of benefits vested by the provisions of §
37-4. All such amendments shall comply with the applicable statutes of the Commonwealth of Pennsylvania.
[Adopted 7-16-2003 by Ord. No. 03-04]
A pension plan is hereby established for the
full-time police officers pursuant to and in compliance with the Act
of May 29, 1956, P.L. (1955) 1804, No. 600, as amended. Such plan
shall be under the direction of the Board of Supervisors of the Township
of East Hempfield and shall be applied under such regulations as the
Board of Supervisors may prescribe. The effective date of this article
shall be January 1, 2003; however, the plan established hereunder
shall be deemed a continuation of the previous police pension plan
for state aid purposes.
As used in this article, the following terms
shall have the meanings indicated:
BOARD OF SUPERVISORS
The governing body of the Township of East Hempfield acting
in the capacity of administrator of the police pension plan established
pursuant to this article.
COMMITTEE
The persons which may be appointed to serve in an advisory
capacity to the Board of Supervisors in the administration of the
plan.
CONTRIBUTION
The monies paid by the employer to the plan and/or the payroll deductions made monthly from the salaries of the participants and paid to the plan, except that "contributions" in §
37-15G shall mean total contributions paid by the participant and accumulated during the period of employment and participation in this plan.
DROP
The deferred retirement option plan created as an optional
form of benefit under the existing East Hempfield Township police
pension plan.
[Added 5-2-2018 by Ord.
No. 2018-03]
DROP PARTICIPANT
A member who is eligible for normal retirement and who has
elected to participate in the DROP.
[Added 5-2-2018 by Ord.
No. 2018-03]
DROP PARTICIPANT ACCOUNT
A separate ledger account created to accumulate the DROP
pension benefit for a DROP participant.
[Added 5-2-2018 by Ord.
No. 2018-03]
EMPLOYER
The Township of East Hempfield.
FUTURE SERVICE LIABILITY
The value of any participant's benefits which shall accrue
by virtue of that participant's service rendered subsequent to the
enactment of this article.
MEMBER
A full-time East Hempfield Township police officer covered
by the plan.
[Added 5-2-2018 by Ord.
No. 2018-03]
PARTICIPANT
Every person duly appointed from time to time by the employer
as a full-time police officer working not less than 40 hours per week
at a definite salary, subject to reasonable vacation and sick leave,
to be included in the plan upon date of hire.
PLAN
The East Hempfield Township police pension plan adopted pursuant
to Act 600.
[Amended 5-2-2018 by Ord.
No. 2018-03]
SALARY
The amount of compensation received by a participant in each
and every month, including base pay, overtime pay, longevity pay,
shift differential and any other such increments. The term "salary"
shall include regular payments made for vacation time, sick time,
compensation time, personal days and bereavement leave, but shall
not include lump-sum payments for any unused days for any of the foregoing
listed benefits.
SERVICE
Total aggregate service, not necessarily continuous, with
the employer.
TERMINATION
The cessation of service by the participant for any reason
including disability, resignation and employee termination. Death
shall not be considered a termination within the meaning of this article.
Voluntary leaves of absence without pay shall not be considered a
termination for the purposes of this article, but no period of such
leave shall be computed in the total service for pension benefit purposes.
Leaves of absence with pay shall not be considered a termination within
the meaning of this article (provided that the Township is able to
certify to the Department of the Auditor General that such participant
on a leave of absence with pay is within the definition of a participant
as set forth herein), but such leaves may be computed in the total
service for pension benefit purposes.
UNFUNDED LIABILITY
The present value of any participant's benefits accrued prior
to the enactment of this article by virtue of that participant's prior
service.
Upon termination of the plan, the assets shall
be distributed as follows:
A. Sufficient funds shall be maintained to provide the pension benefits prescribed in §
37-15 for all participants who have retired prior to the termination of the plan, or who are eligible to retire at the time of the termination of the plan.
B. Sufficient funds shall be maintained to provide vested pension benefits prescribed in §
37-15 for all participants who are eligible for such benefits.
C. Any funds representing contributions from the remaining
participants shall be returned to such participants with interest
at a rate of 6% per annum.
D. Of the remaining funds, those which can be identified
as contributions of the employer, or contributions other than those
identified as unused commonwealth allocations, shall be distributed
as the Board of Supervisors sees fit, provided that such distribution
is made on a uniform basis.
E. All funds in excess of the funds described in Subsections
A,
B,
C and
D above, shall be returned to the commonwealth as unused funds pursuant to the Act of May 12, 1943, P.L. 259, No. 120, as amended, 72 P.S. § 2263.1 et seq.
All investments by the Board of Supervisors
of the assets of this plan shall comply with any applicable state
statutes, rules and regulations with respect to municipal investments
for police pension funds and with such regulations as the Board of
Supervisors shall establish for the purpose of investing such funds.
The Board of Supervisors reserves the right to amend, at any time, in whole or in part, any or all of the provisions of the plan, provided that no such amendment shall authorize or permit any part of the plan to be used or diverted to purposes other than for the exclusive benefit of the participants, their beneficiaries, or their estates. Nor shall any amendment divest a participant of benefits vested by the provisions of §
37-15. All such amendments shall comply with the applicable statutes of the Commonwealth of Pennsylvania.
[Added 5-2-2018 by Ord.
No. 2018-03]
A. Eligibility. Effective January 1, 2018, Members of the East Hempfield
Township Police Department who have not yet retired prior to the implementation
of the DROP may enter into the DROP between July 2 and December 31
of any year following the attainment of age 50 and the completion
of 25 or more years of credited service with East Hempfield Township
Police Department.
B. Written election.
(1) An eligible member of the plan electing to participate in the DROP
must complete and execute a "DROP election form" prepared by East
Hempfield Township and/or the pension plan administrator, which shall
evidence the member's participation in the DROP, and document the
DROP participant's rights and obligations under the DROP. The form
must be signed by the member and the chief administrative officer
of the Plan and submitted to East Hempfield Township, Lancaster County,
Pennsylvania, at least 30 days prior to the member's effective date
of retirement. The DROP election form shall include an irrevocable
notice to the East Hempfield Township by the member that the member
shall terminate from employment with the East Hempfield Township Police
Department effective on a specific date not less than one year nor
more than two years from the effective date of the DROP election.
In addition, all retirement documents required by the East Hempfield
Township police pension plan administrator must be filed and presented
to the Board of Supervisors for approval of retirement and commencement
of the monthly pension benefit. Once the retirement application has
been approved by the Board of Supervisors, it shall become irrevocable.
(2) After a member enters the DROP, contributions to the plan by the
DROP participant and the Township will cease, and the amount of monthly
benefits will be frozen.
(3) The documentation that must be executed before a member may participate
in the DROP shall include a provision releasing the Township from
any liability with regard to investment and other losses (subject
to the guaranteed rate of return set forth herein). As a condition
precedent to participation in DROP, the member must also acknowledge
and agree to hold the Township harmless for any consequences flowing
from the member's decision to participate in DROP, including, but
not limited to, any tax consequences or other financial or other implications
of DROP participation.
(4) Members shall be advised to consult a tax advisor, of their choice,
prior to considering the DROP, as there may be serious tax implications
and/or consequences to participating in the DROP.
C. Limitation on pension accrual. After the effective date of the DROP
election, the DROP participant shall no longer earn or accrue additional
years of continuous service for plan purposes.
D. Benefit calculation. For all plan purposes, continuous service of
a member participating in the DROP shall remain as it existed on the
effective date of commencement of participation in the DROP. Service
thereafter shall not be recognized or used for the calculation or
determination of any benefits payable by the plan. The average monthly
pay of the member for pension calculation purposes shall remain as
it existed on the effective date of commencement of participation
in the DROP. Earnings or increases in earnings thereafter shall not
be recognized or used for the calculation or determination of any
benefits payable by the plan.
E. Payments to DROP participant account. The monthly retirement benefits
that would have been payable had the member elected to cease employment
and receive a normal retirement benefit shall, upon the member commencing
participation in the DROP, be credited on the first day of each month
into a separate ledger account established by the plan administrator
to track and accumulate the DROP participant's monthly pension benefits.
This account shall be designated the DROP participant account. Interest
shall accrue in the DROP participant account between 0% and 4.5% per
year consistent with the earnings of the plan as a whole. All interest
credited to the DROP participant account shall be included in the
final cash settlement.
F. Early termination. A DROP participant may withdraw from the DROP
at any time and no penalty shall be imposed for early termination
of DROP participation. However, the DROP participant shall not be
permitted to make any withdrawals from the DROP participant account
until DROP participation has ended. This section applies when employment
is terminated.
G. Payout.
(1) Upon the termination date set forth in the DROP election form or
on such date as the DROP participant withdraws or is terminated from
the DROP, if earlier, the normal retirement benefits payable to the
DROP participant or the DROP participant's beneficiary, if applicable,
shall be paid directly to the DROP participant or beneficiary and
shall no longer be credited to the DROP participant account. Within
45 days following the actual termination of a DROP participant's employment
with the Township, the accumulated balance in the DROP participant
account shall be paid to the DROP participant in a single lump-sum
payment. Such payment shall be made either in cash, subject to any
federal withholding as may be required, or as a direct rollover to
an Individual Retirement Account (IRA). If the DROP participant or
beneficiary fails to elect a method of payment within 60 days after
the DROP participant's termination date, the retirement system shall
pay the balance as a lump sum in cash.
(2) The form of payment selected by the officer or surviving beneficiary
shall comply with the minimum distribution requirements of the Internal
Revenue Code of 1986, as may be amended.
H. Disability during DROP. If a DROP participant becomes temporarily
disabled during the DROP period, the participation freezes and the
time period while on temporary disability does not count towards the
selected DROP participation period. Upon return to duty, the DROP
period shall resume, continuing with the remaining time left in the
DROP period. The DROP participant shall receive disability pay in
the same manner as disabled police officers that are not participating
in DROP. In no event shall a DROP participant on temporary disability
have the ability to draw from the DROP participant account. However,
notwithstanding any other provision in this subsection, if an officer
is disabled and has not returned to work as of the date of the required
resignation, then such resignation shall take precedence over all
other provisions herein, and said officer shall be required to resign.
If a DROP participant becomes eligible for a disability pension benefit
due to a permanent, service-related disability under Act 600 and terminates
employment, the monthly normal retirement benefit shall cease.
I. Death. If a DROP participant dies before the DROP participant account
balance is paid, the DROP participants' beneficiary under Act 600
shall have the same rights as the DROP participant to withdraw the
DROP participant account balance. The monthly benefit credited to
the DROP participant's DROP participant account during the month of
the DROP participant's death shall be the final monthly benefit for
DROP participation.
J. Forfeiture of benefits. Notwithstanding a member's participation
in the DROP, a member who is convicted or pleads guilty to engaging
in criminal misconduct which constitutes a 'crime related to public
office or public employment', as that phrase is defined in Pennsylvania's
Pension Forfeiture Act, 43 P.S. §§ 1311 through 1314,
shall forfeit his right to receive a pension, including any amounts
currently deposited in the DROP account. In such a case, the member
shall only be entitled to receive the contributions, if any, made
by the member to the Township's police pension fund, without interest.
K. Killed-in-service survivor benefit. If a DROP participant is killed
in service, the DROP participant's beneficiaries under Act 600 shall
be entitled to apply to the Commonwealth of Pennsylvania and receive
a recalculation for payment of survivor benefits at 100% of the DROP
participant's salary at the time of death.
L. Cost of management for DROP. The Police Association and the Township
agree that any costs or fees associated with the management of the
DROP accounts shall be paid directly from the police pension fund
and not by the Township.
M. Amendment. Any amendments to this article shall be consistent with
the provisions covering deferred retirement option plans set forth
in any applicable collective bargaining agreement or state or federal
law, and shall be binding upon all future DROP participants and upon
all DROP participants who have balances in their DROP participant
accounts.