The Commission of the City of Royal Oak shall, by ordinance,
establish and maintain a retirement system in lieu of the present
retirement system established by Ordinance No. 426, which new retirement
system shall provide for the retirement of City officers and employees.
Said new system shall take effect and shall supersede the present
retirement system as of June 1, 1949. The objective of such system
shall be the creation of a sound and efficient means of providing
retirement annuities for the employees to the end that economy and
efficiency in public service may be effected and an orderly method
of retiring be furnished without hardship and prejudice to employees
who have become aged or incapacitated. The terms and conditions of
the ordinance creating such system shall be within the discretion
of the Commission, except as herein provided.
[Amended and adopted 11-6-1973]
Said system shall be administered by a Board of trustees consisting
of two members of the City Commission, the City Manager, one covered
member of the retirement system elected by the covered members of
the system, and one non-covered member of the retirement system elected
by the non-covered members. The election of member trustees shall
be in accordance with such rules and regulations as the Board shall
from time to time adopt. The Board shall authorize the granting of
all benefits provided by the retirement system; determine the amount
of service to be credited each member; appoint an actuary to perform
the actuarial calculations required for the operation of the retirement
system on an actuarial basis; employ such professional and clerical
help and make such rules and regulations as may be necessary to operate
the retirement system on a sound economical basis in the best interests
of the City and the members; hold meetings regularly, at least one
in each calendar quarter, keep records of its proceedings; and perform
such other duties as may be required for the proper administration
of the retirement system.
(a)
All officers and employees of the City, including those on leave
of absence to serve in the armed forces of the United States, shall
be members of the retirement system: Provided, that the membership
of the retirement system shall not include (1) persons whose services
are compensated on a fee basis, (2) persons who are employed on a
part time basis as determined in the ordinance, (3) the medical director,
and (4) the actuary.
(b)
A "covered member" shall mean any member who is covered under
the Federal Social Security Old-Age and Survivors' Insurance
Program on account of his or her City employment. A "non-covered member"
shall mean any member who is not covered under the said Old-Age and
Survivors' Insurance Program on account of his or her City employment.
(c)
In any case of doubt as to an employee's membership status,
the Board shall decide the issue.
[Amended and adopted 11-5-1957]
[Amended and adopted 11-5-1957; 11-6-1973]
The financial objective of this section is to require City contributions
to the retirement system each year which together with the contributions
made by members shall be sufficient to: (i) fully fund the cost of
benefits likely to be paid on account of service rendered by members
during the year, and (ii) finance unfunded costs of benefits likely
to be paid on account of service rendered by members prior to the
current year over a period of not more than 40 years. Such contributions
shall be computed as level percents of member payroll in accordance
with generally accepted actuarial principals on the basis of such
rates of interest and tables of experience as the Board shall from
time to time adopt. The Board shall annually certify to the City Commission
the contributions determined according to this section, and the Commission
shall appropriate and pay to the retirement system during the next
fiscal year the contributions so certified.
[Amended and adopted 11-6-1973]
(a)
Except as provided in paragraph (c) of this section, in no case
shall the annualized amount of a retirement allowance paid a covered
member or the annualized amount of all retirement allowances paid
on account of the death of a covered member exceed the difference
between (i) 80% of the member's annualized final average compensation,
as defined by ordinance, and (ii) the member's annualized primary
insurance amount under the federal old age, survivors, disability,
and health insurance program, or in the event of the death of the
member, the annualized periodic benefit paid by the federal old age,
survivors, disability, and health insurance program; provided, that
the amount of this deduction shall remain at the total primary insurance
amount as first received by the retirant, and shall not be affected
by any future increases in the primary insurance amount.
(b)
Except as provided in paragraph (c) of this section, in no case
shall the annualized amount of a retirement allowance paid a non-covered
member or the annualized amount of all retirement allowances paid
on account of the death of a non-covered member exceed 80% of the
member's annualized final average compensation, as defined by
ordinance.
(c)
Provision may be made for annual or less frequent post-retirement
redetermination of retirement allowances. The redetermined amount
of retirement allowance shall not exceed the amount of retirement
allowance otherwise payable multiplied by the following percent: 100.0%
plus 2.5% for each year, and fraction of a year for the period from
the effective date of the retirement allowance to the date as of which
the redetermination is being made. Any provision of this chapter or
the ordinance which limits the amount of a retirement allowance shall
not apply to the operation of a redetermination provision. The application
of any provision redetermining pension amounts may be restricted to
retirement allowances having an effective date either prior to or
subsequent to a specified date or dates.
(d)
The amount of retirement allowance paid a person who was a member
of the retirement system on November 6, 1973, or paid on account of
the death of a person who was a member of the retirement system on
November 6, 1973, shall not be less than the amount of retirement
allowance computed according to the provisions of Chapter 17A of the
City Charter and the retirement ordinance as they were in effect November
5, 1973.
[Amended and adopted 11-6-1973]
The retirement system shall consist of two divisions, the police
officer and firefighter member division and the general member division,
as defined in the ordinance. The ordinance may also provide for subdivisions
within each division. Separate accounting of the transactions of the
retirement system shall be maintained for each division and shall
clearly indicate the equity of each division in the assets of the
retirement system. Said account separation shall be effective as of
June 1, 1974. Each division shall be regarded as a separate trust
fund. The provisions of this section refer only to the accounting
records of the system and shall not be construed as requiring a physical
segregation of the assets of the system between the divisions.
All assets and funds credited to the retirant system established
by Ordinance No. 426 shall be transferred to the retirement system
established by this chapter. The said assets and other funds so transferred
shall be credited to the pension reserve fund. The benefits allowed
and being paid under the provisions of Ordinance No. 426 shall become
obligations of the retirement system established by this chapter and
shall be paid from the pension reserve fund.
[Amended and adopted 11-6-1973]
The Board of Trustees shall be the trustees of the monies and
assets of the retirement system. The Board shall have full power and
authority to invest and reinvest such monies and assets subject to
all terms, conditions, limitations, and restrictions imposed by the
State of Michigan on the investments of public employee retirement
systems. The Board shall employ outside investment counsel to advise
the Board in the making and disposition of investments. All monies
and assets of the retirement system shall be held for the sole purpose
of meeting disbursements authorized in accordance with the provisions
of this Chapter and shall be used for no other purposes.
No pensions or allowances payable under the provisions of this
chapter, nor any credits of employees in the system, shall be assigned,
nor subject to assignment, nor shall they, or any of them, be subject
to execution, garnishment, or attachment.
Sections 1 to 12, inclusive, of Chapter XVII of the City Charter,
existing prior to the adoption of this amendment shall be repealed
as of June 1, 1949.
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I hereby certify that the foregoing is a correct and accurate
copy of the Charter of the City of Royal Oak, Michigan, adopted by
a vote of the electors on November 8, 1921, as amended.
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_________________________
City Clerk
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