[Adopted 7-12-1989 by Ord. No. 89-10]
The Nonuniformed Employees Pension Plan and
Trust, established for the purpose of providing retirement and other
benefits for said employees, is hereby restated,[1] as stated herein.
[1]
Editor's Note: The Nonuniformed Employees
Pension Plan was originally adopted 10-11-1965 by Ord. No. 621.
As used in this article, the following terms
shall have the meanings indicated:
The age attained by the employee at his or her last birthday.
Any January 1 after the effective date.
The Borough of Downingtown, Chester County, Pennsylvania.
The earnings paid by the Borough to the member during the
plan year as reported to the federal government for income tax purposes,
to include member pretax contributions to deferred compensation plans.
The Council of the Borough of Downingtown, Chester County,
Pennsylvania.
The first day of any month on or after the member's 60th
birthday.
July 1, 1989.
Any person in the full-time employ of the Borough whose customary
employment by the Borough is for not less than 35 hours per week.
The nonvested portion of a member's account.
All assets held by the trustee under the Trust Agreement
and related insurance and investment contracts relating to this plan.
Any date later than normal retirement at which a member retires.
Any employee who has satisfied the eligibility requirements established in § 57-23 hereof.
Each member's individual account maintained within the fund,
to include the prorated share of investment earnings or losses.
The first day of the month coincident with or next following
the date on which the member completes 10 years of service, or the
date on which the member attains age 65, whichever is later to occur.
The period of time at which end an employee is compensated
for his services to the Borough.
The pension plan for the nonuniformed employees of the Borough
of Downingtown as herein set forth and as the same may hereafter be
amended.
A period of 12 consecutive months commencing on any January
1 and ending on the following December 31.
The distribution amount transferred to the plan by a member
from a qualified pension or profit-sharing plan.
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 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 plan, provided that such member
returns to service with the Borough within six months after his 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 the purpose of this plan. Time spent on
reserve or National Guard training shall be included as "service"
for purposes of this plan.
Any condition arising from illness or injury which precludes
an employee from performing the duties associated with the normal
occupational requirements of any position with the Borough, as certified
by a physician designated by the Borough.
The contract between the Council and the trustee establishing
the terms by which and under which the fund is invested, distributed,
accounted for and terminated, as the same now exists and as it may
hereafter be amended.
The Borough Council or any other agency or person appointed
by the Borough Council to serve in that capacity as set forth in the
trust agreement.
Shall mean the nonforfeitable right to any immediate or deferred
benefit in the amount which is equal to the sum of Subsections A and
B below:
The value on that date of that portion of the
participant's account that is attributable to and derived from a participant's
own contributions, if any.
The value on that date of that portion of the
participant's account that is attributable to and derived from employer
contributions multiplied by his vesting percentage determined on the
date applicable.
The member's nonforfeitable interest to his account plus
the earnings thereon computed as of the date determining such percentage
because of the occurrence of some event. Vesting will occur as follows:
[Amended 8-17-2011 by Ord. No. 2011-08]
|
Years of Service
|
Vesting Percentage
| |
|---|---|---|
|
Less than 5
|
0%
| |
|
5
|
100%
|
The plan year during which an employee has completed at least
1,000 hours of work for compensation or compensation entitlement.
A.Â
All persons who are employees, as defined in this
plan, as of the effective date hereof and who have attained age 21
and have completed 1/2 year of service with the Borough shall be a
member as of the effective date.
B.Â
Any person who becomes an employee after the effective
date hereof shall become a member on the first day of the month coincident
with or next following completion of 1/2 year of service.
C.Â
A former member shall become a member immediately upon returning to the employ of the Borough if such member has a nonforfeitable right to all or a portion of the member account derived from Borough contributions at the time of termination of service. If not, he will be considered a new employee for plan eligibility purposes and must meet the requirements of Subsection B hereof.
A.Â
Borough contributions.
[Amended 5-1-2013 by Ord. No. 2013-05[1]]
(1)Â
The
Borough shall contribute on behalf of each member who was a member
during the plan year an amount equal to the fixed percentage of his
compensation for such plan year, as has been established by Borough
Council and which may, from time to time, be changed by Borough Council.
The current level as of the effective date of this ordinance[2] is 7%.
[2]
Editor's Note: "This ordinance" refers to Ord. No. 2013-05,
adopted 5-1-2013, effective 1-1-2013.
(2)Â
No
contribution will be made to a member who was not vested at the time
of termination. Furthermore, for a member who is partially vested
at time of termination, a contribution will be credited based upon
the member’s vested percentage.
[1]
Editor's Note: This ordinance provided an effective date of
1-1-2013.
B.Â
Rollovers and transfers. The trustee may receive on
behalf of a member all or part of the entire amount of any distribution
from a terminated pension or profit-sharing plan or any lump sum distribution
theretofore received by such member from a pension or profit-sharing
plan meeting the requirements of the Internal Revenue Code, Section
401(a).
C.Â
State aid. The portion of the payments made by the State Treasurer to the Borough and designated by the Council to be allocated to the Nonuniformed Employees Pension Fund from money received from taxes paid upon premiums by foreign casualty insurance companies shall be used to reduce or eliminate the Borough contributions pursuant to Subsection A hereof.
D.Â
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 shall be subject to such directions not inconsistent with
this plan as the donors of such funds and property may prescribe.
E.Â
Forfeitures. Forfeitures will be reallocated to member
accounts in the proportion that an individual member's account balance,
excluding rollover account balances, bears to the total of all member
accounts. Forfeitures will be allocated to each member who was a member
on the last day of the plan year.
A.Â
Normal retirement. A member who attains his normal retirement age shall have a vesting percentage, as determined by the definition of "vesting percentage" in § 57-22 hereof. If a member retires on his normal retirement date, he shall receive a distribution of the vested value of his member account valued as of the end of the quarter prior to his normal retirement date, plus contributions made between the end of the previous quarter and his normal retirement date.
B.Â
Early retirement. A member who retires on his early retirement date shall have a vesting percentage, as determined by the definition of "vesting percentage" in § 57-22 hereof, and shall receive a distribution of the vested value of his member account, valued as of the end of the quarter prior to his early retirement date, plus contributions made between the end of the previous quarter and his early retirement date.
C.Â
Late retirement. A member may continue in the service of the Borough after his normal retirement age and, in such event shall retire on his late retirement date. Such member shall continue as a member under this plan until such late retirement date. The member shall have a vesting percentage, as determined by the definition of "vesting percentage" in § 57-22 hereof, and shall receive a distribution of the vested value of his member account, valued as of the end of the quarter prior to his late retirement date, plus contributions made between the end of the previous quarter and his late retirement date.
D.Â
Disability retirement. A member who retires from the
service of the Borough due to a total disability shall have a vesting
percentage of 100% and shall receive a distribution of the entire
value of his member account, valued as of the end of the quarter prior
to his disability retirement date, plus contributions made between
the end of the previous quarter and his disability retirement date.
A.Â
Death prior to retirement. If a member dies prior
to the commencement of pension benefits, then his designated beneficiary
shall be entitled to a vesting percentage of 100% of the member's
account, valued as of the end of the quarter prior to his death, plus
contributions made between the end of the previous quarter and his
date of death. If no such beneficiary survives, the amount will be
paid to the member's estate.
A.Â
Settlement options. Distributions may be made in a
lump sum; however, if not made in a lump sum, they may be made over
one of the following periods or a combination thereof:
B.Â
Joint and survivor annuity. Unless an optional form
of benefit is selected by a member and agreed to by the member's spouse,
the member's vested member account balance will be paid in the form
of a fifty-percent joint and survivor annuity.
A.Â
Distribution.
(1)Â
As of a member's termination of employment, he shall
receive a distribution of his entire vested interest.
B.Â
No further rights or interest. A member shall have
no further interest in any rights to any portion of his member account
that becomes a forfeiture due to his termination of employment.
A.Â
It is the duty of the trustee to pay the benefits to members and their beneficiaries, as provided in §§ 57-25, 57-26 and 57-27, 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 purpose.
B.Â
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 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.
C.Â
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 the Council may direct. The fair market
value of the fund shall be reported to the members at least annually.
A.Â
The plan shall be administered by the Borough Council.
The Council shall make and adopt rules and regulations for the efficient
administration of the plan.
B.Â
The Council shall keep all data, records and documents pertaining to the administration of the plan and shall execute all documents necessary to carry out the provisions of the plan and shall provide all such data, records and documents to the trustees and any other professional whose services are employed pursuant to § 57-29B of this plan.
C.Â
The Council shall construe the plan, shall determine
any questions of fact arising under the plan and shall make all decisions
required of it under the plan and its construction thereof, and decisions
and actions taken thereon in good faith shall be final and conclusive.
It may correct any defect or supply any omission or reconcile any
inconsistency in such manner to such extent as it shall deem expedient
to carry the plan into effect, and it shall be the sole judge of such
expediency. The Council shall act uniformly with respect to matters
coming before it concerning employees in similar circumstances.
D.Â
The Council shall serve without bond, except as may
be otherwise required by law, and without compensation for its service
as such.
E.Â
The members of the Council, and each of them, shall
be free of all liability for any act or omission, except by 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.
F.Â
The 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 examining.
G.Â
To enable the Council to perform its functions, the
Borough shall supply full and timely information to it on all matters
relating to the pay of all members, their retirement, death, termination
of employment and such other pertinent facts as the Council may require.
H.Â
The 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 the Council shall be taken at public meetings, at which at least
four members shall be present, or by written resolution, and any resolutions
concurred in by not fewer than four of its members shall be the action
of the entire Council. Written minutes shall be kept of the meetings
and actions of the Council.
I.Â
The President and Secretary, acting on behalf of the
Council, shall have the power to execute all documents necessary to
carry out the actions of the Council, and any person, partnership,
corporation or government agency shall accept such documents over
such signature or signatures as if executed by the Council.
A.Â
The Pension Committee shall consist of one administrative
employee, one Water Department employee, one Street and Sewer Department
employee, one member of the Borough Council and the Director of Administration
and Finance.
[Amended 2-12-1992 by Ord. No. 92-1; 2-12-1992 by Ord. No.
92-2]
C.Â
The Committee shall have no authority to make decisions.
It serves strictly in an advisory capacity to the Council.
D.Â
Committee members will meet at least semiannually
(February and October) to review the plan administration, fund management,
plan provisions and other matters which, from time to time, may effect
the plan. The Committee will present its findings and/or recommendations
to the Council.
A.Â
It is the expectation of the Borough that it will
continue this pension 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, but continuance of the plan is not
assumed as an obligation of the Borough, and the right is reserved
by the Borough at any time to reduce, suspend or discontinue its contributions
hereunder.
B.Â
The Borough assumes no obligation or responsibility
with respect to the operation of the plan and does not guarantee the
payment of the benefits provided for members of the plan. The Borough
shall have no liability with respect to the administration of the
fund, and payment made under 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
Nonuniformed Employees Pension Fund herein provided for.
C.Â
Nothing contained in the plan shall be held or construed
as a contract or guaranty 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 unpaid,
whenever, in its judgment, its best interests so require, and such
discontinuance shall be without regard to this plan.
A.Â
The Council may amend, curtail or terminate this plan
at any time; provided, however, that no amendment affecting the trustee
shall be made without its consent, other than an amendment having
the effect of terminating the plan, nor shall any amendment 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.
B.Â
In the event of termination of this plan, the Council
shall allocate the assets then remaining in the fund, to the extent
that such assets are sufficient, to members and retired members in
an amount equal to their respective member account balances reduced,
in the cases of retired members, by any prior distributions made to
them.
C.Â
After allocation of the funds, the Council shall determine
whether to operate the fund as the source of whatever payments the
money so allocated will provide.
A.Â
No benefit under this 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 member's beneficiary. This provision shall
not apply to a qualified domestic relations order, defined in the
Internal Revenue Code, Section 414(p), and those other domestic relations
orders permitted to be so treated by the Council under the provisions
of the Retirement Equity Act of 1984. The Council shall establish
a written procedure to determine the qualified status of domestic
relations orders and to administer distributions under such qualified
orders. Further, to the extent provided under a qualified domestic
relations order, a former spouse of a participant shall be treated
as the spouse or surviving spouse for all purposes under this plan.
B.Â
Any person dealing with the trustee may rely upon
a copy of this plan and any amendments thereto certified to be a true
and correct copy by the trustee.
C.Â
Anything heretofore contained in this plan to the
contrary notwithstanding, it is the intention of the Borough that
any action herein provided to be taken by the trustee shall be taken
only in accordance with written instructions of the Council given
in such detail as to preclude the exercise by the trustee of discretion
in the performance thereof.
D.Â
Under no circumstance, whether upon amendment or termination
of this plan or otherwise, shall any part of the fund be used for
or diverted to any purpose other than the exclusive benefit of members
or their beneficiaries until all of the actuarial obligations to such
member or member's beneficiaries have been met.
E.Â
If the Council deems any person incapable of receiving
benefits to which he is entitled by reason of minority, illness, infirmity
or other incapacity, it may direct the trustee to make payment directly
for the benefit of such person to the guardian or trustee of such
person, whose receipt shall be a complete acquittance therefor. Such
payment shall, to the extent therefor, discharge all liability of
the Borough, the trustee and the fund.
F.Â
Should any provision of this plan be determined to
be void by any court, the plan will continue to operate and, to the
extent necessary, will be deemed not to include the provision determined
to be void.
G.Â
Headings and captions provided herein are for convenience
only and shall not be deemed part of the plan.
H.Â
This plan shall be construed and applied under the
laws of the Commonwealth of Pennsylvania where not in conflict with
federal laws, which shall prevail.
