Borough of Brookhaven, PA Police Pension Plan

AVERAGE APPLICABLE COMPENSATION

For the purpose of this chapter, the following definitions shall apply unless the context clearly indicates or requires a different meaning.

AGE

The age attained by an employee at his or her last birthday.

ANNIVERSARY DATE

Any January 1 after the effective date of this chapter.

The average monthly earnings of a member at any time of reference computed over the last 36 months (or such shorter period as represents the member's total period of continuous employment by the Borough) of his or her continuous employment by the Borough prior to such date of reference. For purposes of computing average applicable compensation, actual monthly earnings shall include base pay, longevity pay, night-shift differential pay (if any) and overtime pay, but shall exclude reimbursed expenses or payments in lieu of expenses, non-salary compensation (including, but not limited to, fringe benefits provided by the Borough) or any other payments or allowances (such as uniform allowances). The term "average applicable compensation" shall include and be synonymous with the definition of "salary."

BOROUGH

The Borough of Brookhaven, Delaware County, Commonwealth of Pennsylvania.

CHIEF ADMINISTRATIVE OFFICER

The person who has primary responsibility for the execution of the administrative affairs of this chapter, or the designee of that person.

COMPENSATION

Earnings, including, but not limited to, base pay, longevity pay, night-shift differential pay (if any) and overtime pay, but not including reimbursement expenses or payments in lieu of expenses, non-police compensation, including, but not limited to, fringe benefits provided by the Borough, and any other allowances paid by the Borough (i.e., uniform allowances).

COUNCIL

The Council of the Borough of Brookhaven, Commonwealth of Pennsylvania.

EARLY RETIREMENT DATE

This chapter does not provide for a retirement date prior to the normal retirement date.

EFFECTIVE DATE

The effective date of original Ord. 589, passed October 10, 1994, from which this chapter was derived.

EMPLOYEE

Any person in the full-time employ of the Police Department whose customary employment is for not less than 40 hours a week.

FUND

All assets held by the trust under the trust agreement relating to the Plan.

MEMBER

Any person in the full-time employ of the Police Department who has satisfied the eligibility requirements established in § 282.02 and who is, at the time of reference, or who has been, prior to his or her elimination, making contributions as may be required pursuant to § 282.03(A).

NORMAL RETIREMENT DATE

The first day of the month coincident with or next following the date on which a member completes 25 years of service, and the date on which the member attains age 50.

PLAN

The Police Pension Plan for the Borough, as set forth in this chapter, as the same may hereafter be amended.

PLAN YEAR

A period of 12 consecutive months commencing on any January 1 and ending on the following December 31.

SERVICE

The aggregate of a member's total periods of employment as a full-time employee of the Borough. If a member enters military service, either voluntarily or by conscription, after he or she has been employed for at least six months, such time spent in the Armed Forces of the United States during a period of national emergency shall be counted as service for purposes of this chapter, provided that such member returns to police service with the Borough within six months after his or her discharge or release from such active duty in the Armed Forces of the United States. The time spent in military service due to voluntary extension of such military service during a period of peacetime shall not be included as service for purposes of this chapter. Time spent on Reserve or National Guard training shall be included as service for purposes of this chapter.

TOTAL AND PERMANENT DISABILITY

Any condition arising from a service-connected illness or injury which precludes an employee from performing the duties associated with the normal occupational requirements of any position with the Police Department, as certified by a physician designated by the Borough.

TRUSTEE

The Council of the Borough of Brookhaven or any other agency or person appointed by such Council to serve in that capacity as set forth in the trust agreement.

Wherever applicable as used herein, unless the context specifically provides otherwise, the singular and the plural shall be interchangeable, and the masculine and feminine pronoun shall include either sex.

§ 282.02 Eligibility for membership.

[Ord. 589, passed 10-10-1994]

All persons who are employees (as defined in this chapter), as of the effective date of this chapter, shall be members as of the effective date of this chapter.

Any person who becomes an employee after the effective date of this chapter shall become a member on the first day of service as an employee.

§ 282.03 Contributions.

[Ord. 589, passed 10-10-1994; Ord. 675, passed 7-7-2003]

Member contributions. A member shall pay into the fund at a rate of 5.0% of compensation. Compensation for this purpose shall be as defined in § 282.01. The Council may, on an annual basis, by ordinance or resolution, reduce or eliminate payments into the fund by members. Individual records of contributions by members shall be maintained, including all interest credited to his or her individual account. Interest to be credited shall be 5.0% compounded annually. Interest shall be credited from the end of the plan year in which paid, to the end of the month after which a refund becomes payable.

Refund of members' contributions. Any member who for any reason shall be ineligible to receive a pension after having made contributions shall be entitled to a refund of his or her individual account balance. Such refund is payable immediately upon discontinuance of his or her employment with the police force or within a reasonable time (not more than 45 days after his or her discontinuance of employment). If such discontinuance is due to death, then such refund shall be paid to his or her designated beneficiary or, in the absence thereof, to his or her estate. If a disabled or retired member is receiving a benefit by reason of disability or retirement, then the refund payable to the beneficiary shall be equal to the individual's account balance at the date of his or her disability or retirement, less any pension payments made to the member.

Deposit of members' contributions. Contributions by members shall be remitted to the trustee monthly.

State aid. The portion of payments made by the State Treasurer to the Borough and designated by Council to be allocated to the Fund from money received from taxes paid upon premiums by foreign casualty insurance companies for purposes of pension retirement or disability benefits for police officers, shall be used as follows: to reduce the unfunded liability, or after such liability has been fully funded, to apply against the annual obligation of the Borough for future service costs, or, to the extent that the payment may be in excess of such obligations, to reduce member contributions pursuant to Division (A) hereof.

Borough contributions. Subject to the provisions and limitations set forth in other sections of this chapter, the Borough shall contribute the amounts certified to be necessary by the Fund's actuary to provide the benefits provided by this chapter.

(F)

Contributions by members while on military service. A member who enters the military service during a time of national emergency, either voluntarily or by conscription, shall continue to make contributions to the Plan as provided in Division (A) hereof based on the compensation in effect on the last day of his or her service with the Police Department. These contributions will continue throughout the length of his or her military service. During military service, the trustee shall continue to contribute to the Fund for the officer's benefit. However, no contributions will be made either by or on behalf of a member who voluntarily extends his or her military service during peacetime.

(G)

Other contributions. The Fund shall be authorized to receive, by gift, grant, devise or bequest, any money or property, real, personal or mixed, in trust for the benefit of the Fund. The trustee of the Fund shall be subject to such directions, not inconsistent with this chapter, as the donors of such funds and property may prescribe.

§ 282.04 Retirement and disability benefits.

[Ord. 589, passed 10-10-1994; Ord. 675, passed 7-7-2003]

Normal retirement.

Each member may retire on or at any time after his or her normal retirement date. Any member so retiring shall be entitled to receive a monthly pension commencing as of the first day of the month coincident with or next following his or her date of actual retirement and ending with the payment made as of the first day of the month in which his or her death occurs. The monthly pension to which such retired member shall be entitled to under this chapter shall be equal to 50% of such member's average applicable compensation.

In addition to the monthly retirement benefit described above, each member who has completed in excess of 25 years of service shall receive an additional monthly pension benefit equal to $30 per month for each year of service in excess of 25 years, up to a maximum of $100 per month.

Postponed retirement. An employee shall be allowed to continue as an employee beyond his or her normal retirement date. In such case, the employee shall remain a member of the Plan until he or she actually retires or ceases to be an employee. Any contributions required pursuant to § 282.03(A) shall continue.

Disability benefits. If a member retires because of a total and permanent disability, he or she shall be entitled to receive a pension benefit equal to 70% of his or her salary at the time the disability was incurred, offset by any social security disability benefits received by the member for the same injury. This benefit shall continue until his or her death.

Cost of living adjustment. There shall be a cost of living increase provided to all members who retire as a result of a normal retirement or disability, provided, however, that such cost of living increase shall not exceed the percentage of increase in the All Urban Consumers C.P.I. for the Philadelphia area for the year in which the police officer last worked, and provided, further, that in no case shall the total police pension benefits exceed 75% of the salary for computing retirement benefits, and provided, further, that the total cost of living increase shall not exceed 30%. No cost of living increase shall be granted which would impair the actuarial soundness of the Plan.

§ 282.05 Death benefits.

[Ord. 589, passed 10-10-1994; Ord. 675, passed 7-7-2003; Ord. 784, passed 9-14-2015]

Death prior to commencement of benefits. If a member dies prior to the commencement of pension benefits, then his or her designated beneficiary shall be entitled to a refund of his or her accumulated member's contributions, with credited interest. If no beneficiary survives, then the refund is payable to the member's estate.

Benefits to surviving spouse and dependent children.

If a member dies survived by a spouse or dependent children, after having become eligible to receive a pension benefit, (he or she was eligible because:

(a)

He or she was already receiving a pension; and

(b)

He or she met the age and service requirements, but had not yet retired), then a monthly pension benefit shall be provided.

The amount of the monthly pension benefit shall be 50% of the pension the member was receiving or would have been entitled to receive if he or she had been retired at the time of his or her death.

(3)

In the event a member dies after completing 12 or more years of service but was not yet eligible for normal retirement or pre-retirement survivor benefits, the surviving spouse shall act on behalf of the member in selecting the alternative addressed in § 282.06. If a vested benefit is selected, the surviving spouse shall receive 50% of the member's vested monthly benefit commencing on the first day of the month following the member's normal retirement date.

(4)

The monthly pension benefit is payable to the surviving spouse until death, then to surviving dependent children under the age of 18 years or if attending college, under or attaining the age of 23 years. Attending college shall mean the eligible children are registered at an accredited institution of higher learning and are carrying a minimum course load of seven credit hours per semester. Dependent children shall include, step-children, adopted children and any child conceived before the time of the member's death and thereafter born to the member's spouse.

§ 282.06 Reinvestment or refund of contributions upon severance of employment.

[Ord. 589, passed 10-10-1994]

If a member leaves the employ of the Borough or ceases to be a member, whether by reason of his or her transfer, resignation or discharge, or by reason of disability or retirement other than after becoming eligible for benefits pursuant to §§ 282.04 or 282.05, he or she shall be entitled to a refund of all contributions made by him or her and then on deposit in the Fund, plus interest thereon, computed at the rate described in § 282.03(A).

However, a member who has completed 12 or more years of service may elect either of the following:

He or she may elect to leave his or her contributions, plus interest, in the Fund, so as to receive a vested pension benefit to start at his or her normal retirement date. He or she must file with the Secretary of the Borough, within 90 days of the date he or she ceases to be a full-time police officer, a written notice of his or her intention to vest. The amount of the vested pension benefit shall be (X) divided by (Y), where (X) is the number of years of service at the date of termination and (Y) is the number of years of service which the member would have had if he or she worked until his or her normal retirement date, multiplied by the benefits described in § 282.04(A). Years of service shall be measured in years and completed months; or

He or she may elect to receive a refund of all contributions made by him or her and then on deposit in the Trust Fund, plus interest thereon, computed at the rate described in § 282.03(A). If he or she elects to receive the refund of his or her contributions plus interest, he or she shall forfeit the pension benefit outlined in Division (B)(1) hereof.

§ 282.07 Distribution of benefits.

[Ord. 589, passed 10-10-1994]

Refund benefits becoming distributable pursuant to § 282.06, and death benefits becoming distributable pursuant to § 282.05(A), shall be paid in the form of a lump-sum distribution.

The normal form of all benefits payable hereunder shall be a pension for the life of the member commencing on the date specified and ending with a payment made on the first day of the month in which the member dies, subject, however, to the payment of a death benefit calculated pursuant to § 282.05(B).

§ 282.08 Management of fund.

[Ord. 589, passed 10-10-1994; Ord. 590, passed 10-10-1994]

It is the duty of the trustee to pay the benefits to members and their beneficiaries, as provided in §§ 282.04, 282.05 and 282.06, in accordance with the instructions received from Council, provided, however, that the duty of the trustee to make such payments is wholly contingent upon the sufficiency of the Fund for such purposes.

The Borough may employ an actuary, investment advisors, counsel or other professional consultants from time to time in connection with the operation of the Fund or of this Plan. Such persons or other entities shall be compensated by the Borough at such rates as may be agreed upon by the Council. Such compensation may be paid from the Fund.

The trustee shall make an annual determination of the fair market value of the Fund as of the anniversary date and as of such additional dates as Council may direct. The fair market value of the Fund shall be reported to the actuary, who shall calculate the amount to be contributed to the Fund by the Borough with respect to each plan year in accordance with the assumptions most recently adopted by Council for the purpose of such computations, provided, however, that the liability of the Borough to make such contributions is subject to all of the conditions and limitations set forth elsewhere in this chapter.

The expenses of administering this chapter, including compensation of an actuary, a consultant and a custodian of the Fund, exclusive of the payments of retirement allowances, shall be paid from the assets of the Plan.

§ 282.09 Duties of Council.

[Ord. 589, passed 10-10-1994]

The Plan shall be administered by Council. Council shall make and adopt rules and regulations for the efficient administration of the Plan.

Council shall keep all data, records and documents pertaining to the administration of the Plan, shall execute all documents necessary to carry out the provision of the Plan, and shall provide all such data, records and documents to the professionals whose services are employed pursuant to § 282.08(B).

Council shall interpret the Plan, shall determine any questions of fact arising under the Plan and shall make all decisions required of it under the Plan. Decisions and actions taken thereon in good faith shall be final and conclusive. Council may correct any defect, supply any omission or reconcile any inconsistency in such a manner and to such an extent as it shall, in its sole judgment and discretion, determine. Council shall act uniformly with respect to matters coming before it concerning employees in similar circumstances.

Council, and each member thereof, shall be free of all liability for any act or omission, except for willful misconduct or gross negligence, and each of them shall be fully indemnified by the Borough against all judgments not involving findings of their respective personal or collective willful misconduct or gross negligence, and against all costs, including counsel fees, incurred in defense of actions brought against them.

Council shall make available to members, retired members and terminated members, and to their beneficiaries, for examination during business hours, such records as pertain to the person requesting the examination of the same.

(F)

Council may enact rules and regulations for the administration of the Plan as it may consider desirable, provided that the same shall not be in conflict with any of the provisions of this chapter. All rules and regulations shall be adopted by formal resolution of Council at a regular advertised meeting.

(G)

Council shall enact such rules and regulations for the conduct of its business and for the administration of the Plan as it may consider desirable, provided that the same shall not be in conflict with any of the provisions of the Plan. All actions of Council shall be taken at meetings at which at least four of its members shall be present or by written resolutions concurred in by not less than four of its members. Such actions shall be deemed to be actions of the entire Council. Written minutes shall be kept of the meetings and actions of Council.

(H)

The Secretary, acting on behalf of Council, or any four members of Council, shall have the power to execute all documents necessary to carry out the actions of Council, and any person, partnership, corporation or government agency shall accept such documents over such signature or signatures as if the same were executed by the entire Council.

§ 282.10 Continuation of plan; contributions; charged funds; rights and liabilities of Borough.

[Ord. 589, passed 10-10-1994]

It is the expectation of the Borough that it will continue the Plan indefinitely, and will, from time to time, contribute to the Fund such amounts as may be needed to provide the benefits set forth in the Plan.

The provisions of any ordinance establishing, amending or maintaining the Plan shall not be a charge on any other fund in the treasury of the Borough or under its control, save the Uniformed Employee's Pension Fund herein provided for.

Nothing contained in the Plan shall be held or construed as a contract or guarantee of employment, nor to create any liability upon the Borough to retain any person in its service. The Borough reserves the full right to discontinue the service of any person without any liability, except for salary or wages that may be due and payable, whenever, in its judgment, its best interests so require, and such discontinuance shall be without regard to the Plan.

§ 282.11 Amendment and termination of plan.

[Ord. 589, passed 10-10-1994]

The Borough may amend this chapter from time to time as is necessary to maintain its actuarial soundness and to incorporate changes in Plan benefits or entitlements. However, no amendment shall be made which will, in any manner, divert any part of the Fund to any purpose other than the exclusive benefit of members or their beneficiaries (except that upon termination, such diversion may be made after all of the fixed and contingent liabilities to members and their beneficiaries have been met), nor shall any amendment be made at any time which will, in any manner, divest any benefit then vested in a member, or reduce or eliminate a benefit to which a member has been given an expectation by virtue of a pension ordinance or pension calculations for retiring officers who retired during such member's participation in the Plan.

In the event of the termination of the Plan, Council shall allocate the assets then remaining in the Fund as follows:

Sufficient funds shall be maintained to provide the pension benefits prescribed in § 282.03 for all members who have retired prior to termination or who are eligible for retirement at the time of the termination of the Fund;

Contributions with interest at a rate established by Council as provided in § 282.05 shall be refunded to any and all members who terminate service at the time of the termination of the Fund;

(3)

Of the remaining funds, those which can be identified as Borough contributions or contributions other than from members or from the Commonwealth allocation, shall be distributed as Council sees fit, provided that such distribution is in compliance with § 282.08; and

(4)

All funds in excess of the funds described in Divisions (B)(1), (B)(2) and (B)(3) hereof shall be returned to the Commonwealth as unused funds pursuant to the Act of May 12, 1943, Pub. L. No. 259, as amended (72 P.S. §§ 2263.1 et seq.).

§ 282.12 Miscellaneous provisions.

[Ord. 589, passed 10-10-1994]

No benefit under the Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge or encumbrance, nor to seizure, attachment or other legal process for the debts of any member or such member's beneficiary. This provision shall not apply to a "qualified domestic relations order" as defined in Code § 414(p), and those other domestic relations orders permitted to be so treated by Council under the provisions of the Retirement Equity Act of 1984, as amended. The Borough shall establish a written procedure to determine the qualified status of domestic relations orders to administer distributions under such qualified orders. Further, to the extent provided under a "qualified domestic relations order," a former spouse of a member shall be treated as the spouse or surviving spouse for all purposes under the Plan.

Any person dealing with the Borough may rely upon a copy of this chapter and any amendments thereto certified by the trustee to be true and correct.

In no circumstance, whether upon amendment or termination of the Plan or otherwise, shall any part of the Fund be used or diverted to any purpose other than the exclusive benefit of members or their beneficiaries until all of the actuarial obligations to such members and their beneficiaries have been met.

If Council deems any person incapable of receiving benefits to which he or she is entitled, by reason of minority, illness, infirmity or other incapacity, it may make payment directly for the benefit of such person, to the guardian or trustee for said person, whose receipt shall be complete acquittance therefor. Such payment shall, to the extent therefor, discharge all liability of the Borough or the Fund.