A retirement fund and system is hereby established
pursuant to the right of the City to establish the same under the
provisions of 11 O.S. § 48-101 et seq. (Article XLVIII,
Retirement Systems).
The name of the retirement fund and system established
by this article, and the name by which all of its business shall be
transacted, its funds handled, and in which all of its property held,
shall be "Employee Retirement System (A-2) of El Reno, Oklahoma."
The purpose of the fund and system established
by this article shall be to provide deferred compensation to eligible
employees of the City in order to encourage continuity and meritorious
service on the part of such employees and thereby promote public efficiency
by providing retirement allowances for such employees to the extent
set out in this article. Whether such employees are engaged in a nongovernmental
function of the City shall not be taken into account if such employees
are otherwise eligible. It is intended that the fund and system comply
with all applicable provisions of the Internal Revenue Code of the
United States and that the trust hereinafter established to administer
the fund and system qualify as a tax-exempt trust under the provisions
of Section 401(a) of the Internal Revenue Code of 1954.
The effective date of the fund and system established
by this article is January 1, 1967.
As used in this article, the following terms
shall have the meanings here given them:
An employee's monthly compensation from the City, as determined
by the City.
The City of El Reno, Oklahoma, a municipal corporation.
Benefits under the group annuity contract purchased by the
trustees under the terms of this article.
All full-time employees of Park View Municipal Hospital,
whether appointed or hired.
The first day of the month coincident with or next following
a participant's 65th birthday, or at the end of 10 years of service,
whichever is later.
An employee who has benefits under the plan.
The Employee Retirement System (A-2) of El Reno, Oklahoma.
The time spent in the employ of the City as well as time
off on military leave after becoming an employee, to include only
the continuous time spent in the employ of the City since the date
of last employment.
The trustees designated in this article to administer the
plan.
A.
For the purpose of managing and administering the
employee retirement system established by this article, there is hereby
created a board of trustees, which shall be known as the "Board of
Trustees of Employee Retirement System (A-2) of the City of El Reno,
Oklahoma."
B.
The board of trustees shall be composed of five members. The City Clerk shall be a member of the board and shall act as the clerk and secretary of the board. The Hospital Administrator shall also be a member of the board. Three employees, who shall be elected in the manner provided in Subsection C, shall complete the board membership; provided that the City Treasurer shall serve as an ex-officio member of the board and shall act as treasurer of the retirement system established in this article.
C.
Within 30 days after the adoption of this article,
the employees shall elect by ballot three members to serve on the
board of trustees, one of whom shall serve for a term of one year;
one of whom shall serve for a term of three years; and one of whom
shall serve for a term of two years. Thereafter, the employees shall
each year elect by ballot one of their fellow employees to serve for
a term of three years upon the board of trustees.
D.
If at any time a vacancy occurs on the board of trustees,
the vacancy shall be filled for the unexpired term in the same manner
that the office was previously filled.
E.
The trustees shall not be required to make bond nor
shall they be entitled to any compensation for their services as trustees.
The trustees, if otherwise eligible to participate in the plan, shall
not be excluded from participation merely because they are trustees,
but no trustee shall make any determination in respect to his own
benefits and rights under the plan. Any action taken by a majority
of the trustees in accordance with the terms of the plan shall be
as binding as if taken by all trustees. The trustees may delegate
to one of their number the performance of any act in the administration
of the trust. All discretionary powers under the plan shall be administered
in a nondiscriminatory manner and for the exclusive benefit of the
participants and their beneficiaries.
The trustees shall keep written records of their
actions under this article. The trustees are hereby authorized to
make written rules and regulations for the administration of the trust
so long as such rules and regulations are not inconsistent with the
terms of the plan as set out in this article or as hereafter amended.
All employees under 65 years of age in service
on the effective date of the plan shall be eligible to become participants
as of such effective date. All employees entering the employment of
the City after the effective date of the plan will be eligible to
become participants in the plan on the anniversary date of the plan
coincident with or next following the date they enter the employment
of the City, provided that, on such anniversary, they shall not have
reached their 60th birthday. No former employee of the City who shall
have retired prior to the effective date of this plan or a spouse
of any such deceased employee shall be eligible to participate in
this plan or receive any benefits under this plan.
The City shall notify the trustees, on or before
the effective date of this plan and on or before each anniversary
thereof, of the name, sex, date of birth, basic monthly salary as
of the effective date of the plan or as of the anniversary thereof,
whichever is applicable, and the date of last employment by the City,
of all employees eligible to participate in the plan, together with
such other and additional information as the trustees may reasonably
require to administer the plan. The trustees shall have the right
to require each eligible employee who elects to participate in the
plan to sign such form as the City may require evidencing the agreement
of the employee to participate in the plan and containing the agreement
of the employee to all of the terms and provisions of the plan as
established and as it may from time to time be amended and also containing
the agreement of the employee to make the contributions required of
him under the terms of the plan. The trustees shall have the right
to rely on all such certifications made to them by the City with respect
to all matters relating to the plan. The City shall also promptly
notify the trustees when the employment of any participant is terminated,
whether by death or otherwise, and shall also notify the trustees
when any participant reaches his normal retirement date. All notifications
required by this section shall be in writing.
A participant who remains in the employ of the
City until his normal retirement date shall be entitled to retire
and receive the benefits provided for him under this plan. If a participant
remains in the employment of the City after his normal retirement
date, no further contributions will be made for him either by the
City or by himself with respect to service after his normal retirement
date.
Commencing on the date of participation of an employee under the plan and monthly thereafter while the plan shall be in effect and while a participant is receiving his basic monthly salary, the trustees shall purchase and pay for from funds contributed by the City and by the participant, as provided in this article, annuity coverage under the group annuity contract provided for in this article, in an amount equal to 1/12 of 1% of that portion of a participant's basic monthly salary which is under $550 plus 1 1/2% of that portion of a participant's basic monthly salary which is $550 and in excess of $550. The annuity so purchased shall be known as a current service benefit and shall be payable in the form of a monthly income commencing on the normal retirement date of the participant and payable so long as the participant shall live, with payments guaranteed in any event for five years. No participant shall be entitled to a current service benefit in excess of that above described. The group annuity contract may, however, provide for an optional joint and survivor method of payment of the current service benefit. With respect to employees who become participants under the plan as of its effective date, and with respect to them only, an additional benefit known as a past service benefit shall be provided to the extent and subject to the conditions and limitations set out in § 82-43.
A.
With respect to employees who become participants
in the plan as of its effective date, and only with respect to such
employees, a past service benefit is, subject to the conditions herein
stated, hereby granted in the form of a monthly income commencing
on the normal retirement date of the participant and payable so long
as the participant shall live and with payments guaranteed in any
event for five years. The group annuity contract may, however, provide
for an optional joint and survivor method of payment of the past service
benefit. The amount of each such monthly payment shall be equal to
1% of that portion of a participant's basic monthly salary under $550
plus 1 1/2% of that portion of a participant's basic monthly
salary which is $550 and in excess of $550, and based on the basic
monthly salary in effect with respect to such participant on the effective
date of the plan multiplied by the number of full years of completed
continuous service between the date such participant last entered
the employment of the City and the effective date of the plan.
B.
If an employee eligible to become a participant under
the plan as of its effective date shall not elect, within 90 days
from the effective date of the plan, to become a participant he shall
forfeit all right to any past service benefit to which he might otherwise
be entitled.
C.
Any other provisions herein to the contrary notwithstanding, it is specifically provided that, except on the termination of the plan and then only to the extent funds of the plan are then available, all as set out in § 82-51, a participant shall not be entitled to any past service benefit to which he might otherwise be entitled unless he shall remain in the service of the City for at least 10 years, and a participant in the plan until his normal retirement date. Accordingly, there shall be no obligation on the part of the City to fully fund the past service benefit of a participant prior to the time such participant reaches normal retirement date.
D.
The City is hereby authorized to deposit from time
to time with the life insurance company issuing the group annuity
contract funds available for the purpose in order to pay the cost
of the anticipated past service benefits that may be payable under
the plan to those participants entitled thereto under the plan and
who remain in the plan until their normal retirement date. The amount
of such deposits shall be such as shall be necessary to provide for
the payment of the past service benefit that may be payable and based
upon actuarial advice furnished to the City by the insurance company
issuing the group annuity contract. Such deposits so made shall accumulate
at the rate of interest specified in the group annuity contract. When
each participant shall reach normal retirement date, the trustees
shall specifically direct the insurance company to use so much of
the funds so deposited with the interest accumulated thereon to pay
for the past service benefit to which the participant may be entitled
at normal retirement date under the terms of the plan. Any other provisions
in the plan to the contrary notwithstanding, no participant shall
be entitled to have purchased for him a past service benefit to which
he might otherwise be entitled except to the extent that there shall
be sufficient money in the deposit fund to pay for such past service
benefit. No deposits made by the City with respect to the funding
of past service benefits shall be allocated to any participant prior
to the time the trustees shall actually purchase and pay for such
past service benefit. No employee who becomes a participant other
than as of the effective date of the plan shall be entitled to a past
service benefit.
In order to provide the benefits contemplated
by the plan, the City is hereby authorized to purchase a group annuity
contract from a legal reserve life insurance company authorized to
do business in the State of Oklahoma. Such contract shall be made
by the insurance company and the trustees hereinafter appointed and
shall contain such terms and provisions, not in conflict with the
terms of this article, as shall be agreed upon by the insurance company
and the trustees, and the insurance company is hereby authorized and
empowered to deal with such trustees alone with respect to all of
the terms and provisions of such group annuity contract.
A.
Each participant shall contribute monthly to the cost
of his benefits an amount equal to 2% of that portion of his basic
monthly salary under $550 plus 3% of that portion of his basic monthly
salary which is $550 and in excess of $550. Each participant shall
be required to authorize the City, in writing, to deduct from his
basic monthly salary his required contributions under the plan. The
City shall pay the remaining cost of providing the benefits to which
a participant is entitled under the plan.
B.
The City is hereby authorized to pay the premiums
required to be paid, from the contributions of the City and from the
participant, together with the contract administration charge of the
insurance company, all as stated in the group annuity contract. Such
group annuity contract shall contain a provision guaranteeing that
the premium rates stated in the contract shall remain in force and
effect for a period of at least five years. It is hereby expressly
provided that forfeitures shall not be applied to increase the benefits
any participant would otherwise receive under the plan. All forfeited
values to which the trustees shall be entitled shall be used by them
in the payment of that portion of the City's contributions then due
or next thereafter becoming due.
A.
No death benefit is provided by the plan with respect
to any participant if such participant dies prior to his normal retirement
date, insofar as the contributions made to the plan by the City are
concerned. With respect to a participant who dies prior to his normal
retirement date, a death benefit shall be provided in an amount equal
to the contributions made to the plan by the participant, plus interest
as specified in the group annuity contract for such death benefit.
B.
In the event a participant shall die after normal
retirement date and without having received monthly retirement income
payments under the group annuity contract for five years, then the
monthly retirement income payments shall be continued for any remaining
portion of such guaranteed period of five years to the participant's
beneficiary, and if such beneficiary shall die before having received
the remaining guaranteed payments, the commuted value of the remaining
payments, computed as provided in the group annuity contract, shall
be paid to the executors or administrators of the estate of such deceased
beneficiary. In the event a participant shall die after normal retirement
date and after having received monthly retirement income payments
for five years, no further benefits shall be payable under this plan
with respect to such participant. Nothing herein contained shall prevent
a participant from electing an optional joint and survivor method
of payment of his retirement benefits in accordance with the provisions
of the group annuity contract.
C.
A participant shall have the right to name and change
the beneficiary entitled to receive any death benefit provided under
the plan in accordance with the terms and provisions of the group
annuity contract.
D.
If a participant shall fail to designate a beneficiary
with respect to any death benefits that may be payable under the plan,
or if a beneficiary designated by the participant shall fail to survive
the participant, then any death benefit payable under the terms of
the plan shall be payable to the executors or administrators of the
estate of the deceased participant, subject, however, to the terms
and provisions of the group annuity contract.
A.
The benefits of any participant under the plan who,
at the time of his termination of employment, is not entitled to receive
normal retirement income shall cease except as herein provided. If
the employment of any participant shall terminate prior to the completion
of 10 years of service, he shall forfeit all rights and benefits under
the plan, except that he shall be entitled to a refund of his contributions
plus interest thereon at the rate of 3 1/2% per annum compounded
annually.
B.
If the employment of any participant is terminated
on or after the completion of 10 years of service, the participant
shall be entitled to receive a monthly retirement income commencing
on his normal retirement date in the amount provided by his paid-up
benefits in force at the time of his termination of employment, conditioned,
however, that he leave his contributions in the plan and if he shall
withdraw such contributions then he shall forfeit all such benefits
under the plan.
C.
If the employment of any participant is terminated
on or after the completion of 10 years of service, the participant
shall be entitled to receive monthly retirement income in the amount
of his past service benefits beginning at his normal retirement date,
conditioned, however, that he leave his contributions in the plan
and if he shall withdraw such contributions then he shall forfeit
all such benefits under the plan.
D.
If a participant shall terminate employment while
in good health, as determined by the insurance company issuing the
group annuity contract, any funds which have been contributed to the
plan by the City for such participant and which are not vested in
such participant shall be paid to the trustees.
E.
In the event of termination of employment prior to
completion of 10 years of service, a participant shall not be entitled
to any past service benefit to which he might otherwise have been
entitled.
If a participant is on an authorized leave of
absence without salary or on military leave, no current service benefit
will be purchased for him so long as his salary is discontinued. During
such leave, however, the benefits already purchased for him will continue
in force.
A.
In order that this plan may conform to the requirements
of the Internal Revenue Service relating to qualified pension plans,
it is hereby provided that any provisions in this plan to the contrary
notwithstanding, the City's contributions which may be used for the
benefit of any participant whose annual benefit under the plan will
exceed $1,500, but applicable only to the 25 highest compensated employees
as of the effective date of the plan (including any such highly compensated
employees who are not participants at the time but who may later become
participants), will be subject to the restrictions set forth in this
section. Such restrictions will become applicable if:
(1)
The plan is terminated within 10 years after its effective
date;
(2)
The benefits become payable within 10 years after
the effective date of the plan; or
(3)
The benefits become payable after the plan has been
in effect for 10 years and the full current cost of the plan for the
first 10 years have not been met.
B.
In the case of Subsection A(2) above, the restrictions will remain applicable until the plan has been in effect for 10 years, but if at that time the full current costs have been met, the restrictions will no longer apply to such benefits. In the case of Subsection A(2) and (3) above, if at the end of the first 10 years the full current costs are not met, the restrictions will continue to apply until the full current costs are met for the first time.
C.
Contributions.
(1)
The contributions which may be used for the benefit
of any participant described in this section shall not exceed the
greater of $20,000, or 20% of the first $50,000 of compensation of
such employee multiplied by the number of years between the effective
date of the plan and:
(2)
However, if the full current costs of the plan have not been met on the date described in Subsection C(1)(a) or (b) of this section, whichever is applicable, then the date of the failure to meet such full current costs shall be substituted for the date referred to in such subsections. For the purpose of determining the contributions which may be used for the benefit of a participant when Subsection C(1)(b) of this section applies, the number of years taken into account may be recomputed for each year if the full current costs of the plan are met for such year.
D.
For the purpose of this section, the contributions
which, at a given time, may be used for the benefits of a participant
include any unallocated funds which would be used for his benefit
if the plan were then terminated as well as all contributions allocated
up to that time exclusively for his benefits.
E.
The provisions of this section shall apply to a former
or retired participant as well as to a participant still in the City's
service. The limitations of this section shall not restrict the full
payment of any death benefits on behalf of a participant.
F.
The restrictions heretofore set out in this section
may be exceeded for the purpose of making current retirement income
benefit payments to retired participants who would otherwise be subject
to such restrictions if:
(1)
The contributions which may be used for any such participant
in accordance with the restrictions contained in this section will
apply either:
(a)
To provide level amounts of annuity in the basic
form of benefit provided under the plan for such participant at retirement,
or if he is already retired, beginning immediately; or
(b)
To provide level amounts of annuity in an optional
form of benefit provided under the plan if the level amount of annuity
under such optional form of benefit is not greater than the level
amount of annuity under the basic form of benefit provided under the
plan.
(2)
The annuity thus provided is supplemented, to the
extent necessary to provide the full retirement income benefits in
the basic form called for under the plan, by current payments to such
participant as such benefits become due; and
(3)
Such supplemental payments are made at any time only
if the full current costs of the plan have then been met, or the aggregate
of such supplemental payments for all such participants does not exceed
the aggregate City contributions already made under the plan in the
year then current.
G.
Any benefits which cannot ultimately be paid to a participant (or to a retired participant) because of the termination of the plan prior to the expiration of 10 years from its effective date shall be reapportioned among the remaining participants, excluding those participants described in Subsection A of this section, in the ratio that the City's contributions for each such participant bears to the total contributions for all participants, excluding those participants described in Subsection A of this section. If there are no remaining participants, excluding those participants described in Subsection A of this section, the value of these benefits shall be refunded to the City.
H.
The limitations imposed by this section will automatically
cease and expire, and without the necessity of an amendment to this
plan, in the event that the Commissioner of Internal Revenue shall
rule that such limitations are no longer necessary to meet the requirements
of the Internal Revenue Code.
No participant or beneficiary shall have the
right to alienate or encumber any benefits provided under the plan,
and no interest of any participant or beneficiary shall be subject
to garnishment, attachment, execution or claims of creditors of such
participant or beneficiary, and the provisions of 60 O.S. §§ 327
and 328 are hereby specifically adopted and incorporated herein.
The City shall have the right to amend at any time and from time to time the terms and provisions of the plan and to terminate the plan, any of which actions shall be accomplished by ordinance of the City. No such amendment or termination shall, however, deprive any participant of any vested interest in any benefits then purchased and paid for with respect to him under the terms of the plan and to which the participant has a then vested interest. In the event the plan shall be terminated by the City, the trustees shall distribute to each participant the coverage evidencing his current service benefit and, if any funds remain on deposit with the insurance company with respect to the funding of past service benefits, the trustees shall purchase such past service benefits for the participants then in active service and who are, under the terms of the plan, entitled to a past service benefit at the ratio that the cost of each participant's past service benefit bears to the total cost of the past service benefit of all participants entitled to past service benefits. It is hereby expressly provided that, upon complete discontinuance of contributions by the City, the rights of all participants to their current service benefit accrued to the date of such discontinuance to the extent then funded shall be nonforfeitable, but this provision shall not apply to benefits or contributions which, under the provisions of § 82-49, may not be used for the 25 highest paid participants described in § 82-49 in the event of early termination of the plan.
The trust established under this article shall be irrevocable in the sense that the contributions of the City may never be recovered by it, except under the contingency set out in § 82-49G. The trust shall be administered exclusively for the benefit of the participants and it shall be impossible for any trust property ever to revert to the City, except in the contingency provided in § 82-49G, or to be used or diverted to any purpose other than for the exclusive benefit of the participants and their beneficiaries. Otherwise, the trust may be altered, amended or terminated by the City, by proper ordinance and without the consent of any participant, beneficiary or employee. No such amendment or termination shall deprive a participant of any interest then vested in him with respect to benefits previously purchased and actually paid for with respect to him, but nothing herein contained shall be construed to give a participant any vested interest in any past service benefits. No amendment increasing the duties and responsibilities of the trustees shall be made without their written consent.
The applicable terms and provisions of the Oklahoma
Trust Act, 60 O.S. § 175.1 et seq., as the same now exists
and as the same may hereafter be amended, shall, except to the extent
in this article specifically provided otherwise, govern the administration
of the trust.
The trustees shall use ordinary care and diligence
in the performance of their duties under this article, but they shall
not be liable for any mistake of judgment or for any action taken,
or for any action not taken, unless resulting from their own willful
misconduct or gross neglect. Under no circumstances shall either the
City or the trustees or any of them be personally liable for any benefits
contemplated to be provided by the plan, it being the sole responsibility
of the trustees to receive from the City the contributions made by
it and by the participants and to use such contributions to pay the
premiums and contract administration charge, all as stated in the
group annuity contract.
No insurance company which may issue the group
annuity contract shall be required to take or permit any action contrary
to the provisions of such contract; or be bound to allow any benefit
or privilege to any person interested in such contract which is not
provided for in such contract; or be deemed to be a party to the plan
and trust established by this article; or be responsible for the validity
of the trust; or be required to look into the terms of the trust;
or question any act of the trustees hereunder; or be required to see
that any action of the trustees is authorized by the terms of the
trust created in this article. Any such issuing company shall be fully
protected in taking or permitting any action on the faith of any instrument
executed by the trustees in their name as trustees and shall incur
no liability for so doing.
