[Adopted 1-5-1981 as Ord. No. 1499; amended
in its entirety 5-17-1988 by Ord. No. 1670]
A.
ACT OF APRIL 13, 1972, P.L.
ADMINISTRATOR
AVERAGE MONTHLY EARNINGS
CONTINUOUS SERVICE
COVERED COMPENSATION
EFFECTIVE DATE
EMPLOYEE
EMPLOYER
EQUIVALENT ACTUARIAL VALUE
MORTALITY:
female age set back five years
GROUP ANNUITY CONTRACT
INSURANCE COMPANY
MUNICIPAL PENSION PLAN FUNDING STANDARD AND RECOVERY ACT OF
DECEMBER 18, 1984, P.L.
PLAN
RETIRED EMPLOYEE
RETIREMENT BENEFIT
VESTING
Definitions. As used in this Article, the following
terms shall have the meanings indicated:
1984, AS AMENDED -- 53 P.S. § 1-101 et seq., Home
Rule Charter and Optional Plans Law.
The body which is to perform the administrative functions of this plan, as established in accordance with § 40-44, Administration.
An employee's monthly salary or wage paid or accrued as recorded
by the employer to the Internal Revenue Service for income tax purposes
equal to the final year's compensation with the employer.
The period of uninterrupted employment of an employee with
the employer.
The salary paid to the Commissioners of Cheltenham Township.
For this revised plan, January 1, 1987.
Any person employed as a Commissioner of Cheltenham Township.
Cheltenham Township.
Value when computed on the basis of the following actuarial
table:
1971 Group Annuity Mortality Table
INTEREST: 8% Compounded Annually
A contract issued by the insurance company providing for
the payment of retirement benefits to employees who become entitled
to such benefits in accordance with the provisions of this plan.
A legal reserve life insurance company organized or incorporated
under the laws of any one of the United States of America and duly
licensed in the Commonwealth of Pennsylvania.
1005, NO. 205, 53 P.S. § 895.101 ET SEQ. -- An
act to provide for the annual distribution of state aid to municipalities
to offset employee pension costs.
The retirement plan for the Board of Commissioners of Cheltenham
Township as revised on January 1, 1987, and as it may from time to
time be amended thereafter, which is established by the employer for
the purpose of providing retirement benefits for employees of the
employer who are eligible to participate herein in accordance with
the provisions of this plan.
A former employee who is retired under the plan and who is
receiving retirement benefits provided for hereunder.
The monthly payments to which an employee shall become entitled
hereunder.
A right that an employee who has at least 12 years of service
acquires in all or a portion (depending on his length of service)
of employer contributions made on his behalf. Such right is not contingent
on his continuing in employment with the employer but is contingent
on his reaching his normal retirement date.
B.
Word usage. Wherever used herein, a pronoun in the
masculine gender shall be considered as including the feminine gender
unless the context clearly indicates otherwise, and wherever used
herein a pronoun in the singular form shall be considered as being
in the plural form unless the context clearly indicates otherwise.
A.
"Credited service" shall mean the number of full years
of continuous service and fraction thereof with the employer, as determined
by the administrator, completed by the employee from his last date
of employment to the date of termination of employment.
B.
Continuous service.
(1)
Continuous service with the employer shall not be
broken in the event of:
(a)
Absence with the consent of the administrator
during any period not in excess of one year, except that the administrator
may consent to extend the period of leave.
(b)
Absence from work because of occupational injury
or disease incurred as a result of employment with the employer, for
which absence an employee shall be entitled to worker's compensation
payments.
(c)
Absence in the service of the Armed Forces of
the United States, provided that the employee shall reenter the employ
of the employer within the statutory period during which his right
to reemployment is guaranteed after he has first become eligible for
discharge or separation from active duty.
C.
An employee shall not receive credited service in the case of any of the periods of absence set forth in Subsection B above, but shall retain credited service accrued prior to such absence. Upon returning to employment after an approved absence, the employee will again accrue credited service.
D.
Failure to return to the employ of the employer by the end of any period specified in Subsection B above shall be considered a termination of employment. Any other absence shall also be considered a termination of employment. Any employee whose employment has been terminated shall, for the purpose of this plan, be deemed a new employee upon resumption of his employment unless he is vested in accordance with § 40-42 hereof.
A.
Normal retirement date. An employee's normal retirement
shall be the first day of the month consistent with or next following
his or her 65th anniversary of his or her date of birth and the completion
of 12 years of service as a Commissioner. Said retirement age shall
be decreased by one year for each year of service in excess of 20
years. In no event can the retirement age be less than age 55.
[Amended 10-15-2002 by Ord. No. 2017-02]
B.
Commissioners are entitled to receive any and all
benefits on their retirement date the same as salaried employees,
including, but not limited to, their existing health insurance benefits.
[Added 10-15-2002 by Ord. No. 2017-02; amended 1-20-2009 by Ord. No. 2176-09]
(1)
Commissioners
elected prior to, and who are in office as of, January 1, 2009, who
serve at least 12 years before leaving office shall receive post-retirement
health benefits at the time they reach normal retirement age, at no
cost to the Commissioner.
(2)
Any
Commissioner newly elected after January 1, 2009, shall be subject
to the contract provisions for post-retirement health benefits for
the Salaried Employees Association, including contributions to health
insurance premiums at such time that the Commissioner has served a
minimum of 12 years, has reached normal retirement age, and is no
longer a member of the Board.
C.
Deferred retirement date. With the annual consent
of the administrator, an employee may continue in employment beyond
his normal retirement date to a deferred retirement date which may
be the first day of any month subsequent to this normal retirement
date.
A.
Normal retirement benefit. The monthly amount of normal
retirement benefit payable to an employee retiring on his normal retirement
date shall be an amount equal to a product of (a) multiplied by (b)
where (a) is equal to the final year's compensation and (b) is equal
to 60%, plus an additional 5% for each complete year of service in
excess of 12 years but not in excess of 16 years (maximum 80% for
16 or more years of service).
B.
Deferred retirement benefit. The monthly amount of
deferred retirement benefit payable to an employee retiring on his
deferred retirement date shall be determined in the same manner as
his normal retirement benefit, based on his credited service and average
monthly earnings to his deferred retirement date.
C.
Forfeitures. No part of any forfeitures resulting
from the application of any provision of this plan shall be applied
to increase the benefits any employee would otherwise receive under
this plan.
D.
Retired participants will continue to receive retirement
benefits in the same amount as was being paid immediately prior to
the effective date of this amended and restated plan. A participant
who terminated employment prior to the effective date of this amended
and restated plan, who is subsequently reemployed, shall have such
retirement benefits determined in accordance with the provision of
the plan in effect as of the date of such participant's termination
of employment.
A.
Normal form of retirement benefit; life annuity; modified
cash refund. A retired employee's retirement benefit shall normally
be payable in the form of a monthly life annuity commencing on his
actual retirement date and ceasing with the last payment due immediately
preceding the retired employee's death.
B.
Contingent annuitant option.
C.
In lieu of the normal form of retirement benefit described in Subsection A above, an employee may elect a contingent annuitant option which provides for an actuarially reduced benefit payable to the retired employee during his lifetime and for the continuance of such retirement benefit payments in either the same or a percentage of such reduced amount of a contingent annuitant, if living, after the retired employee's death.
D.
If the contingent annuitant is the spouse of the retired
employee or if the contingent annuitant is any other person not more
than 30 years younger than the retired employee, the benefit payable
under this option is payable without restriction. If, however, the
contingent annuitant is a person other than the spouse of the retired
employee and is more than 30 years younger than the retired employee,
the benefit otherwise payable under this option to the contingent
annuitant shall be limited so that the value of the annuity payable
to the contingent annuitant shall be less than 50% of the value of
the retired employee's total original benefit, both calculated as
of the retired employee's actual retirement date.
E.
The monthly payment to the contingent annuitant shall
commence on the first date of the month following the month in which
the retired employee dies, if the contingent annuitant is then living,
and shall continue monthly with the last payment due for the month
in which the contingent annuitant's death occurs.
F.
If a contingent annuitant dies before the employee's
actual retirement date, the normal form of retirement benefit will
automatically become payable (unless the employee names another contingent
annuitant before his actual retirement date) as if a contingent annuitant
option had not been elected. If the contingent annuitant predeceases
the retired employee after retirement, the retirement benefit payments
will cease upon the retired employee's death. No monthly benefit will
be payable to a contingent annuitant if the employee dies before his
first retirement benefit payment becomes due.
(1)
If an employee who has elected this option should
die after his normal retirement date and prior to his deferred retirement
date, the contingent annuitant, if living, shall become a survivor
annuitant and shall be entitled to benefits, payable for such survivor
annuitant's further lifetime, in a monthly amount equal to the amount
which would have been payable to the contingent annuitant had the
employee retired on the date of his death with the contingent annuitant
option operative.
(2)
Notwithstanding any of the provisions outlined above,
the minimum total of all benefits payable under this option shall
be an amount not less than the total of all the retired employee's
contributions hereunder with credited interest to his annuity commencement
date.
G.
Option for life annuity with 120 payments guaranteed.
(1)
In lieu of the normal form of retirement benefit described in Subsection A above, an employee may elect an option for life annuity with 120 payments for an actuarially reduced retirement benefit payable to the retired employee during his lifetime with the guaranty that not less than a total of 120 monthly retirement benefit payments will be made to the retired employee and his named beneficiary.
(2)
If this option is elected and the retired employee
dies prior to the receipt of the 120 guaranteed monthly payments,
the balance of the guaranteed monthly payments will be paid to the
retired employee's named beneficiary until a total of 120 monthly
payments has been made to the retired employee and his named beneficiary.
The first such payment to the beneficiary shall be due and payable
as of the first day of the month following the retired employee's
death.
(3)
In the event that there is no named beneficiary living
at the death of the retired employee, the balance of the 120 guaranteed
monthly payments, which would otherwise have become payable to the
retired employee's beneficiary, shall be commuted to a single sum
and be paid to the retired employee's executors or administrators.
(4)
If the beneficiary of a deceased retired employee
should die prior to receiving the balance of the 120 guaranteed monthly
payments, the balance of 120 guaranteed monthly payments which would
otherwise have become payable to the retired employee's beneficiary
shall be commuted to a single sum and shall be paid to the beneficiary's
executors or administrators.
(5)
If an employee who has elected this option should
die after his normal retirement date and prior to his deferred retirement
date, his beneficiary shall become a beneficiary annuitant and shall
be entitled to benefits payable to the employees had the employee
retired on the date of his death with the option for life annuity
with 120 payments guaranteed operative.
(6)
Notwithstanding any of the provisions outlined above,
the minimum total of all benefits under this option shall be an amount
not less than the total of all the retired employee's contributions
hereunder with credited interest to his annuity commencement date.
H.
Any one option may be elected by the employee by written
notice to the administrator at least one month before the employee's
actual retirement date.
I.
Once a choice as to a form of retirement benefit or
a retirement date is made and accepted by the administrator, it cannot
be rescinded by the employee without the written consent of the administrator,
conditioned upon satisfactory evidence of the good health of the employee
and any person entitled to receive payments upon the death of the
employee. In no event shall the consent of any person entitled to
receive payments upon the death of the employee be required as a condition
to the right of an employee to revoke or change any option previously
elected.
J.
Anything in this plan to the contrary notwithstanding,
the employee shall not have the right prior to his retirement irrevocably
to elect to have all or a part of his interest in this plan, which
would otherwise become available to him during his lifetime, paid
only to his beneficiary after his death.
K.
If a retired employee is reemployed by the employer,
his retirement benefit payments shall cease with the last payment
due prior to his reemployment. Retirement benefit payments shall again
become payable on the first day of the month following subsequent
termination of employment.
L.
M.
If a participant dies after he begins to receive his
retirement benefit but before the entire interest in his retirement
benefit has been distributed to him, the entire interest in his retirement
benefit (or the remaining part of such retirement benefit) will be
distributed at least as rapidly as under the method of distribution
in effect prior to his death. If a participant dies before he begins
to receive his retirement benefit, the entire interest in his retirement
benefit will be distributed within five years after his death unless
the below applies:
(1)
Any portion of the participant's retirement benefit is payable to a designated beneficiary, and the portion of the participant's retirement benefit will be distributed according to Subsection H above, and such distribution of the participant's retirement benefit begins not later than one year after the date of the participant's death; or
(2)
The designated beneficiary is the surviving spouse
of the participant and the participant's interest to which the surviving
spouse is entitled will be distributed according to Subsection H(2)
above. If the surviving spouse dies before payments are required to
begin, the entire interest in the participant's retirement benefit
will be distributed within five years of the death of the surviving
spouse.
N.
A retired participant who commenced to receive retirement
benefits prior to the effective date of this amended and restated
plan shall have such benefits continued in the same form as such benefits
were being paid to him immediately preceding the effective date of
this amended and restated plan.
A.
Upon the death of an employee on or after his normal retirement date there shall be payable to his named beneficiary a death benefit payable in accordance with the provisions of § 40-40.
B.
Payment of the death benefits as outlined above shall
be in lieu of all obligations of the insurance company with regard
to the retired employee under this plan.
A.
A participant who terminated (for any reason other than death) prior to normal retirement date but after 12 years of service will have a right to a deferred vested pension beginning at normal retirement date in an amount determined in the same manner as for a pension at normal retirement date under § 40-38A above but based on service and earnings up to date of termination. Payment of such pension before normal retirement date will not be permitted. No vesting before completion of 12 years of service.
|
Vesting Schedule
| |
|---|---|
|
Years of Service
|
Vested Percentage
|
|
Less than 12
|
0
|
|
12 years
|
100
|
A.
For the purpose of funding the retirement benefits
provided for herein, the employer will enter into a group annuity
contract of the deposit administration type with the insurance company.
B.
The employer will make periodic payments to the insurance
company, determined on the basis of annual actuarial estimates furnished
by a qualified actuary chosen by the administrator which shall be
in such amounts as the Township deems necessary for the accumulation
to be sufficient to purchase applicable retirement benefits or as
mandated by Act 205.[1]
[1]
Editor's Note: See 53 P.S. § 895.101
et seq.
C.
No part of the funds held by the insurance company
shall be used for or diverted to purposes other than for the exclusive
benefit of employees covered under this plan prior to the satisfaction
of all liabilities hereunder with respect to them.
D.
No person shall have any interest in or right to any
of the funds contributed to or held by the insurance company under
this plan except as expressly provided in this plan and the group
annuity contract and then only to the extent that such funds have
been contributed by the employer to the insurance company.
A.
This plan shall be administered by the employer in
accordance with this plan and the group annuity contract. All decisions
of the employer with respect to the administration of this plan which
are consistent in all respects with the intent and purposes of this
plan shall be conclusive and binding on all concerned.
B.
The employer shall determine the benefits payable
under this plan and shall have the right to make rules as may be necessary
for such administration, shall require employees to file written application
for retirement, to produce satisfactory evidence of their date of
birth and furnish such other information as may from time to time
be deemed necessary.
[Amended 8-17-2022 by Ord. No. 2444-22]
A.
Effective October 17, 2022, the Township of Cheltenham (the "employer") shall permanently discontinue the retirement plan for the Board of Commissioners of Cheltenham Township found under Article IV of this chapter (the "plan"), and all future contributions to the plan.
A.
This plan shall be discontinued upon written notice
by the employer to the employees covered hereunder and upon written
notice to the insurance company of discontinuance of this plan. A
complete discontinuance of contributions by the employer shall be
deemed a discontinuance of this plan.
B.
In the event that this plan shall be discontinued
or if contributions hereunder are discontinued permanently by the
employer, no further payments shall be made to the insurance company,
and any funds derived from contributions which are available for the
purchase of retirement benefits for employees and former employees
retaining a vested interest under this plan remaining in the hands
of the insurance company shall become vested in said employees covered
under this plan at the date of discontinuance in the manner indicated.
(1)
Any funds which shall be available for distribution
upon discontinuance of this plan shall be applied to purchase retirement
benefits, at the date of such discontinuance, for employees eligible
on that date for normal retirement hereunder in amounts to which said
employees shall be entitled under this plan to the extent that sufficient
funds therefor shall be available.
(2)
Any funds which shall be available for distribution after the purchase of retirement benefits described in Subsection B(1) above shall be applied to purchase retirement benefits, at the date of such discontinuance, for persons who are receiving disability retirement benefits under this plan in amounts to which said persons were receiving to the extent that sufficient funds therefor shall be available.
(3)
Any funds which shall be available for distribution after the purchase of the retirement benefits described in Subsection B(1) and (2) above shall be applied to purchase retirement benefits, at the date of such discontinuance, for employees and former employees not included in Subsection B(1) and (2) above but who retain a vested interest in this plan in amounts to which said employees shall be entitled under this plan to the extent that sufficient funds therefor shall be available.
(4)
Any funds which shall be available for distribution after the purchase of the retirement benefits described in Subsection B(1), (2) and (3) above shall be applied to purchase retirement benefits, at the date of such discontinuance, for employees and former employees not included in Subsection B(1), (2) and (3) above but who retain a vested interest in this plan in amounts to which said employees shall be entitled under this plan to the extent that sufficient funds therefor shall be available.
(5)
Any funds which shall be available for distribution after the purchase of the retirement benefits described in Subsection B(1), (2), (3) and (4) above shall be applied to purchase retirement benefits, at the date of such discontinuance for all other employees in amounts to which said employees shall be entitled under this plan to the extent that sufficient funds therefor shall be available.
C.
Said available funds shall be used to completely purchase
the retirement benefits in any one class, as described above, before
being used for subsequent classes. In the event that the funds available
for a class are insufficient to completely purchase the retirement
benefits for such class, they shall be applied pro rata within the
class to purchase such benefits to the extent that such funds are
sufficient.
D.
Any funds paid by the employer to the insurance company which shall be available for distribution after the purchase in full of all the retirement benefits described in § 40-46B above shall be deemed to have become available as a result of actuarial error and shall be paid in cash to the employer.
A.
Inclusion in this plan shall not be construed as giving
an employee or participant any right to be retained in the service
of the employer without its consent, nor shall it interfere with the
right to the employer to discharge an employee or participant, nor
shall it give an employee or participant any right, claim or interest
in any retirement benefits herein described except upon fulfillment
of the provisions and requirements of this plan.
B.
Under certain circumstances, retirement benefit payments
may be paid to a retired participant or the person designated by him
to receive payments upon his death, if applicable, in a lump sum where
such monthly benefit would be less than $10, such lump sum payment
to be the actuarial equivalent of such monthly retirement benefit.
C.
No person entitled to benefits under this plan shall
have the right to assign, commute or encumber the benefits herein
provided. To the maximum extent permitted by law, the benefits or
payments herein provided shall not in any way be liable to attachment,
garnishment or other process, or to be seized, taken, appropriated
or applied by any legal or equitable process, to pay any debt or liability
of such person.
D.
All of the terms and provisions of this plan shall
be as stated herein. This plan shall not be effected by any other
ordinance, ruling or provision unless that ordinance, ruling or provision
has been expressly incorporated into this plan.
