HomeMy WebLinkAboutO-10-04ORDINANCE NO 0 -10 -04
AN ORDINANCE OF THE CITY OF SEBASTIAN, FLORIDA,
AMENDING CHAPTER 58, ARTICLE III, POLICE OFFICERS'
RETIREMENT SYSTEM; PROVIDING FOR AN EFFECTIVE
DATE AND CONFLICTS.
WHEREAS, in 1989 the City instituted a Chapter 185 police pension plan; and
WHEREAS, the legislative history of said pension plan, including each subsequent
amendment thereto, has stated the intention that said plan be a statutory chapter plan; and
WHEREAS, the City Code language provides that any provisions of the City Code
inconsistent with a Chapter 185 plan shall not be given effect; and
WHEREAS, it has been determined that the best means for the City of Sebastian to
remain in compliance with Chapter 185 requirements is to directly adopt said Chapter 185 with
the following minimum changes necessary;
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
SEBASTIAN, INDIAN RIVER COUNTY, FLORIDA, as follows:
SECTION 1: That the Code of Ordinances, City of Sebastian, Florida, section 58 -46, is
hereby amended to read as follows:
Sec. 58 -46. Maintenance of Statutory Chapter Plan.
The City of Sebastian shall maintain a Statutory Chapter Plan for police officers'
pensions in accordance with the provisions of Florida Statutes Chapter 185 subject to the
following provisions:
Lai Notwithstanding the provisions of F.S. 185.02(4) (c) to the contrary:
For any person who first becomes a member in any plan year beginning on or
after January 1, 1996, compensation in excess of the Internal Revenue Code
401(a)(17) limitation as of the first day of the Plan Year shall be disregarded for
any purpose, including employee contributions or any benefit calculations. The
annual compensation of each member taken into account in determining benefits
or employee contributions for any Plan Year beginning on or after January 1,
2002, may not exceed $200,000, as adjusted for cost -of- living increases in
accordance with Code Section 401(a)(17)(B). Compensation means
compensation during the fiscal year. The cost -of- living adjustment in effect for a
calendar year applies to annual compensation for the determination period that
begins with or within such calendar year. If the determination period consists of
fewer than 12 months, the annual compensation limit is an amount equal to the
otherwise applicable annual compensation limit multiplied by a fraction, the
numerator of which is the number of months in the short determination period,
and the denominator of which is 12. If the compensation for any prior
determination period is taken into account in determining a Member's
contributions or benefits for the current Plan Year, the compensation for such
prior determination period is subject to the applicable annual compensation limit
in effect for that prior period.
(b) Notwithstanding the provisions of Section 185.02(5) d. to the contrary:
The years or fractional parts of a year that a Member performs "Qualified
Military Service" consisting of voluntary or involuntary "service in the
uniformed services" as defined in the Uniformed Services Employment
and Reemployment Rights Act (USERRA) (P.L.103 -353), after separation
from employment as a Police Officer with the City, shall be added to his
years of Credited Service for all purposes, including vesting, provided
that:
1. The Member is entitled to reemployment under the provisions of
USERRA.
2. The Member returns to his employment as a Police Officer within
one (1) year from the earlier of the date of his military discharge or
his release from active service, unless otherwise required by
USERRA.
3. The maximum credit for military service pursuant to this paragraph
shall be five (5) years.
4. This paragraph is intended to satisfy the minimum requirements of
USERRA. To the extent that this paragraph does not meet the
minimum standards of USERRA, as it may be amended from time
to time, the minimum standards shall apply.
In the event a Member dies on or after January 1, 2007, while performing
USERRA Qualified Military Service, the beneficiaries of the Member are
entitled to any benefits (other than benefit accruals relating to the period
of qualified military service) as if the Member had resumed employment
and then died while employed.
(c) Section 185.02 is hereby amended to add subsection (17) to read:
(17) Actuarial Equivalent means a benefit or amount of equal value, determined on
the basis of actuarial equivalency using assumptions adopted by the Board such that actuarial
assumptions are not subject to City discretion.
(d) Section 185.05 is hereby amended to add subsection (8), Indemnification,
to read:
(8) Indemnification.
(a) To the extent not covered by insurance contracts in force from time to
time, the city shall indemnify, defend and hold harmless members of the
board from all personal liability for damages and costs, including court
costs and attorneys' fees, arising out of claims, suits, litigation, or threat of
same, herein referred to as "claims against these individuals because of
acts or circumstances connected with or arising out of their official duty as
members of the board. The city reserves the right, in its sole discretion,
to settle or not settle the claim at any time, and to appeal or to not appeal
from any adverse judgment or ruling, and in either event will indemnify,
defend and hold harmless any members of the board from the judgment,
execution, or levy thereon.
(b) This section shall not be construed so as to relieve any insurance
company or other entity liable to defend the claim or liable for payment of
the judgment or claim, from any liability, nor does this section waive any
provision of law affording the city immunity from any suit in whole or part,
or waive any other substantive or procedural rights the city may have.
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(c) This section shall not apply nor shall the city be responsible in any
manner to defend or pay for claims arising out of acts or omissions of
members of the board which constitute felonies or gross malfeasance or
gross misfeasance in office.
(e) Notwithstanding the provisions of F.S. 185.05(1) (a) to the contrary:
(1) (a) The membership of the board of trustees for chapter plans consists of five
members, two of whom, unless otherwise prohibited by law, must be legal
residents of the municipality and must be appointed by the legislative
body of the municipality, and two of whom must be police officers as
defined in s.185.02 who are elected by a majority of the active police
officers who are members of such plan. With respect to any chapter plan
or local law plan that, on January 1, 1997, allowed retired police officers
to vote in such elections, retirees may continue to vote in such elections.
The fifth member shall be chosen by a majority of the previous four
members, and such person's name shall be submitted to the legislative
body of the municipality. Upon receipt of the fifth person's name, the
legislative body shall, as a ministerial duty, appoint such person to the
board of trustees. The fifth member shall have the same rights as each of
the other four members appointed or elected, shall serve as trustee for a
period of 2 4 years, and may succeed himself or herself in office. Each
resident member shall serve as trustee for a period of 4 years, unless
sooner replaced by the legislative body at whose pleasure the member
serves, and may succeed himself or herself as a trustee. Each police
officer member shall serve as trustee for a period of 4 years, unless he or
she sooner leaves the employment of the municipality as a police officer,
whereupon a successor shall be chosen in the same manner as an
original appointment. Each police officer may succeed himself or herself
in office.
(f)
Notwithstanding the provisions of F.S. 185.06(1) (b) 4.b., to the contrary:
b. The board of trustees shall not invest more than 5 percent of its assets in
the common or capital stock of any one issuing company, nor shall the
aggregate investment in any one issuing company, exceed 5 percent of
the outstanding capital stock of that company, nor shall the aggregate of
its investments under this section at market exceed 70 percent of the
fund's assets.
j Notwithstanding the provisions of F.S. 185.07 (1) (b), to the contrary:
(1) (b) Except as reduced or increased contributions are
authorized by subsection (2), by the payment to the fund of 5
percent of the salary of each full -time police officer duly appointed
and enrolled as a member of such police department, which 5
percent shall be deducted by the municipality from the
compensation due to the police officer and paid over to the board
of trustees of the retirement trust fund wherein such police officer
is employed. No police officer shall have any right to the money so
paid into the fund except as provided in this chapter. Member
contributions withheld by the city on behalf of the member shall be
deposited with the board immediately after each pay period. The
contributions made by each member to the fund shall be
designated as employer contributions pursuant to 414(h) of the
Internal Revenue Code. Such designation is contingent upon the
contributions being excluded from the members' gross income for
Federal Income Tax purposes. For all other purposes of the
system, such contributions shall be considered to be member
contributions.
(h) Notwithstanding the provisions of F.S. 185.16(2) to the contrary:
The amount of the monthly retirement income payable to a police officer who
retires subsequent to May 31, 2002 and on or after his or her normal retirement
date shall be an amount equal to the number of the police officer's years of
credited service multiplied by 3.0 percent of his or her average final
compensation. However, if current state contributions pursuant to this chapter
are not adequate to fund the additional benefits to meet the minimum
requirements in this chapter, only incremental increases shall be required as
state moneys are adequate to provide. Such increments shall be provided as
state moneys become available.
(i)
The provisions of Section 185.16 are amended to add subsection (5), to
read:
(5)
Required Distribution Date. The member's benefit under this section
must begin to be distributed to the member no later than April 1 of the
calendar year following the later of the calendar year in which the
member attains age seventy and one -half (70 or the calendar year in
which the member terminates employment with the city.
(j) The provisions of Section 185.21, Death prior to retirement; refunds of
contributions or payment of death benefits, subsection (2), is amended to read:
(2) Vested members with spouse beneficiary. This subsection (2)
applies only when the member's spouse is the sole designated
beneficiary. If a police officer having at least 10 years of credited service
dies prior to retirement, his or her spouse beneficiary is entitled to the
benefits otherwise payable to the police officer at early or normal
retirement age.
(a) Notwithstanding anything contained in this section to the contrary,
in any event, distributions to the spouse beneficiary will begin by
December 31 of the calendar year immediately following the
calendar year in which the member died, or by a date selected
pursuant to the above provisions in this section that must be on or
before December 31 of the calendar year in which the member
would have attained 70%.
(b) If the surviving spouse beneficiary commences receiving a benefit
under subsection (1) above, but dies before all payments are
made, the actuarial value of the remaining benefit will be paid to
the spouse beneficiary's estate in a lump sum.
(3)
Vested members with non spouse beneficiary. This subsection applies
only when the member's spouse is not the beneficiary or is not the sole
designated beneficiary, but there is a surviving beneficiary. If a police
officer having at least 10 years of credited service dies prior to retirement,
his or her beneficiary is entitled to the benefits otherwise payable
beginning by December 31 of the calendar year immediately following the
calendar year in which the member died. The benefit will be calculated
as for normal retirement based on the deceased members' credited
service and average final compensation and actuarially reduced to reflect
the commencement of benefits prior to the normal retirement date.
(a) If a surviving beneficiary commences receiving a benefit under
subsection (3) above, but dies before all payments are made, the
actuarial value of the remaining benefit will be paid to the surviving
beneficiary's estate by December 31 of the calendar year of the
beneficiary's death in a lump sum.
(b) If there is no surviving beneficiary as of the member's death, and
the estate is to receive the benefits, the actuarial equivalent of the
member's entire interest must be distributed by December 31 of
the calendar year containing the fifth anniversary of the member's
death.
(c) The Uniform Lifetime Table in Treasury Regulations 1.401(a)(9)-
9 shall determine the payment period for the calendar year
benefits commence, if necessary to satisfy the regulations.
In the event that a death benefit paid by a life insurance company exceeds the
limit set forth in s. 185.061(6), the excess of the death benefit over the limit shall be paid
to the municipal police officers' retirement trust fund. However, death benefits as
provided pursuant to s. 112.19 or any other state or federal law shall not be included in
the calculation of death or retirement benefits provided under this chapter.
(k) The provisions of Section 185.161 are amended to read:
(1) (a) In lieu of the amount and form of retirement income payable in the event
of normal or early retirement as specified in s. 185.16, a police officer,
upon written request to the board of trustees and subject to the approval
of the board of trustees, may elect to receive a retirement income or
benefit of equivalent actuarial value payable in accordance with one of
the following options:
1. A retirement income of larger monthly amount, payable to the
police officer for his or her lifetime only.
2. A retirement income of a modified monthly amount, payable to the
police officer during the joint lifetime of the police officer and a
joint pensioner designated by the police officer, and following the
death of either of them, 100 percent, 75 percent, 66 percent, or
50 percent of such monthly amount payable to the survivor for the
lifetime of the survivor. Except where the retiree's joint pensioner
is his spouse, the payments to the joint pensioner as a percentage
of the payments to the retiree shall not exceed the applicable
percentage provided for in the applicable table in the Treasury
regulations. (See Q A -2 of 1.401(a) (9) -6)
3. Such other amount and form of retirement payments or benefit as,
in the opinion of the board of trustees, will best meet the
circumstances of the retiring police officer.
(b) The police officer upon electing any option of this section will designate
the joint pensioner or beneficiary (or beneficiaries) to receive the benefit,
if any, payable under the plan in the event of the police officer's death,
and will have the power to change such designation from time to time but
any such change shall be deemed a new election and will be subject to
approval by the pension committee. Such designation will name a joint
pensioner or one or more primary beneficiaries where applicable. If a
police officer has elected an option with a joint pensioner or beneficiary
and his or her retirement income benefits have commenced, he or she
may thereafter change the designated joint pensioner or beneficiary but
only if the board of trustees consents to such change and if the joint
pensioner last previously designated by the police officer is alive when he
or she files with the board of trustees a request for such change. The
consent of a police officer's joint pensioner or beneficiary to any such
change shall not be required. The board of trustees may request such
evidence of the good health of the joint pensioner that is being removed
as it may require and the amount of the retirement income payable to the
police officer upon the designation of a new joint pensioner shall be
actuarially predetermined taking into account the ages and sex of the
former joint pensioner, the new joint pensioner, and the police officer.
Each such designation will be made in writing on a form prepared by the
board of trustees, and on completion will be filed with the board of
trustees. In the event that no designated beneficiary survives the police
officer, such benefits as are payable in the event of the death of the police
officer subsequent to his or her retirement shall be paid as provided in s.
185.162.
(2) Retirement income payments shall be made under the option elected in
accordance with the provisions of this section and shall be subject to the
following limitations:
(a) If a police officer dies prior to his or her normal retirement date or early
retirement date, whichever first occurs, no benefit will be payable under
the option to any person, but the benefits, if any, will be determined under
s. 185.21.
(b) If the designated beneficiary (or beneficiaries) or joint pensioner dies
before the police officer's retirement under the plan, the option elected will
be canceled automatically and a retirement income of the normal form
and amount will be payable to the police officer upon his or her retirement
as if the election had not been made, unless a new election is made in
accordance with the provisions of this section or a new beneficiary is
designated by the police officer prior to his or her retirement and within 90
days after the death of the beneficiary.
(c) If both the retired police officer and the designated beneficiary (or
beneficiaries) die before the full payment has been effected under any
option providing for payments for a period certain and life thereafter,
made pursuant to the provisions of subparagraph (1) (a) 3., the board of
trustees may, in its discretion, direct that the commuted value of the
remaining payments be paid in a lump sum and in accordance with s.
185.162.
(d) If a police officer continues beyond his or her normal retirement date
pursuant to the provisions of s. 185.16(1) and dies prior to actual
retirement and while an option made pursuant to the provisions of this
section is in effect, monthly retirement income payments will be made, or
a retirement benefit will be paid, under the option to a beneficiary (or
beneficiaries) designated by the police officer in the amount or amounts
computed as if the police officer had retired under the option on the date
on which death occurred.
(e) The member's benefit under this section must begin to be
distributed to the member no later than April 1 of the calendar year
following the later of the calendar year in which the member attains age
seventy and one -half (70 or the calendar year in which the member
terminates employment with the city.
(3) No police officer may make any change in his or her retirement option after the
date of cashing or depositing his or her first retirement check.
(4) Notwithstanding anything herein to the contrary, the board in its discretion, may
elect to make a lump sum payment to a member or a member's beneficiary in the
event that the total commuted value of the monthly income payments to be paid
do not exceed one thousand dollars ($1,000.00). Any such payment made to
any person pursuant to the power and discretion conferred upon the board by the
preceding sentence shall operate as a complete discharge of all obligations
under the system with regard to such member and shall not be subject to review
by anyone, but shall be final, binding and conclusive on all persons.
(1) Maximum pension.
(1) Basic limitation. Notwithstanding any other provisions of this system to
the contrary, the member contributions paid to, and retirement benefits
paid from, the system shall be limited to such extent as may be necessary
to conform to the requirements of Code Section 415 for a qualified
retirement plan. Before January 1, 1995, a plan member may not receive
an annual benefit that exceeds the limits specified in Code Section
415(b), subject to the applicable adjustments in that section. On and after
January 1, 1995, a plan member may not receive an annual benefit that
exceeds the dollar amount specified in Code Section 415(b)(1)(A)
($160,000), subject to the applicable adjustments in Code Section 415(b)
and subject to any additional limits that may be specified in this System.
For purposes of this section, "limitation year" shall be the calendar year.
(2) Adjustments to Basic Limitation for Form of Benefit. If the form of benefit
without regard to any benefit increase feature is not a straight life annuity,
then the Code Section 415(b) limit applicable at the annuity starting date
is reduced to an actuarially equivalent amount (determined using the
(3)
assumptions specified in Treasury Regulation Section 1.415(b) -1(c) (2)
(ii)) that takes into account the death benefits under the form of benefit.
Benefits Not Taken into Account. For purposes of this Section, the
following benefits shall not be taken into account in applying these limits:
a. Any ancillary benefit which is not directly related to
retirement income benefits;
b. Any other benefit not required under §415(b) (2) of the Code and
Regulations there under to be taken into account for purposes of
the limitation of Code Section 415(b) (1).
(4) COLA Effect. Effective on and after January 1, 2003, for purposes of
applying the limits under Code Section 415(b) (the "Limit the following
will apply:
a. A member's applicable limit will be applied to the member's annual
benefit in the member's first calendar year of benefit payments
without regard to any automatic cost of living adjustments;
b. thereafter, in any subsequent calendar year, a member's annual
benefit, including any automatic cost of living increases, shall be
tested under the then applicable benefit limit including any
adjustment to the Code Section 415(b)(1)(A) dollar limit under
Code Section 415(d), and the regulations there under; but
c. in no event shall a member's benefit payable under the system in
any calendar year be greater than the limit applicable at the
annuity starting date, as increased in subsequent years pursuant
to Code Section 415(d) and the regulations there under.
Unless otherwise specified in the system, for purposes of applying
the limits under Code Section 415(b), a Member's applicable limit
will be applied taking into consideration cost of living increases as
required by Section 415(b) of the Code and applicable Treasury
Regulations.
(5) Other Adjustments in Limitations.
a. In the event the member's retirement benefits become payable
before age sixty -two (62), the limit prescribed by this section shall
be reduced in accordance with regulations issued by the
Secretary of the Treasury pursuant to the provisions of Code
Section 415(b) of the Code, so that such limit (as so reduced)
equals an annual straight life benefit (when such retirement
income benefit begins) which is equivalent to a one hundred sixty
thousand dollar ($160,000) annual benefit beginning at age sixty
two (62).
b. In the event the member's benefit is based on at least fifteen (15)
years of credited service as a full -time employee of the fire or
police department of the City, the adjustments provided for in (5)a.
above shall not apply.
c. The reductions provided for in (5) a. above shall not be applicable
to disability benefits or pre- retirement death benefits.
d. In the event the member's retirement benefit becomes payable
after age sixty -five (65), for purposes of determining whether this
benefit meets the limit set forth in subsection (1) herein, such
benefit shall be adjusted so that it is actuarially equivalent to the
benefit beginning at age sixty -five (65). This adjustment shall be
made in accordance with regulations promulgated by the
Secretary of the Treasury or his delegate.
(6) Less than Ten (10) Years of Service. The maximum retirement benefits
payable under this section to any member who has completed less than
ten (10) years of credited service with the City shall be the amount
determined under subsection (1) of this section multiplied by a fraction,
the numerator of which is the number of the member's years of credited
service and the denominator of which is ten (10). The reduction provided
by this subsection cannot reduce the maximum benefit below 10 The
reduction provided for in this subsection shall not be applicable to
disability benefits or pre- retirement death benefits.
Participation in Other Defined Benefit Plans. The limit of this section with
respect to any member who at any time has been a member in any other
defined benefit plan as defined in Code Section 414(j) maintained by the
City shall apply as if the total benefits payable under all City defined
benefit plans in which the member has been a member were payable
from one plan.
(8) Ten Thousand Dollar ($10, 000) Limit. Notwithstanding the foregoing, the
retirement benefit payable with respect to a member shall be deemed not
to exceed the limit set forth in this section if the benefits payable, with
respect to such member under this system and under all other qualified
defined benefit pension plans to which the City contributes, do not exceed
ten thousand dollars ($10,000) for the applicable plan year and for any
prior plan year and the City has not any time maintained a qualified
defined contribution plan in which the member participated.
Reduction of Benefits. Reduction of benefits and /or contributions to all
plans, where required, shall be accomplished by first reducing the
member's benefit under any defined benefit plans in which member
participated, such reduction to be made first with respect to the plan in
which member most recently accrued benefits and thereafter in such
priority as shall be determined by the board and the plan administrator of
such other plans, and next, by reducing or allocating excess forfeitures for
defined contribution plans in which the member participated, such
reduction to be made first with respect to the plan in which member most
recently accrued benefits and thereafter in such priority as shall be
established by the board and the plan administrator for such other plans
provided, however, that necessary reductions may be made in a different
manner and priority pursuant to the agreement of the board and the plan
administrator of all other plans covering such member.
(10) Service Credit Purchase Limits.
a. Effective for permissive service credit contributions made in
limitation years beginning after December 31, 1997, if a member
makes one or more contributions to purchase permissive service
credit under the system, if otherwise allowed by the system, then
the requirements of this section will be treated as met only if:
1. the requirements of Code Section 415(b) are met,
determined by treating the accrued benefit derived from all
such contributions as an annual benefit for purposes of
Code Section 415(b), or
2. the requirements of Code Section 415(c) are met,
determined by treating all such contributions as annual
additions for purposes of Code Section 415(c).
3. For purposes of applying subparagraph (10) a.1., the
System will not fail to meet the reduced limit under Code
Section 415(b) (2) (C) solely by reason of this
subparagraph 3., and for purposes of applying
subparagraph (10) a.2., the System will not fail to meet the
percentage limitation under Section 415(c) (1) (B) of the
Code solely by reason of this subparagraph 3..
b. For purposes of this subsection the term "permissive service
credit" means service credit-
1. recognized by the system for purposes of calculating a
member's benefit under the plan,
2. which such member has not received under the plan, and
3. which such member may receive only by making a
voluntary additional contribution, in an amount determined
under the system, which does not exceed the amount
necessary to fund the benefit attributable to such service
credit.
Effective for permissive service credit contributions
made in limitation years beginning after December 31,
1997, such term may, if otherwise provided by the system,
include service credit for periods for which there is no
performance of service, and, notwithstanding clause (10)
b.2., may include service credited in order to provide an
increased benefit for service credit which a member is
receiving under the system.
c. For purposes of applying the limits in this subsection (10), only
and for no other purpose, the definition of compensation where
applicable will be compensation actually paid or made available
during a calendar year, except as noted below and as permitted
by Treasury Regulations Section 1.415(c) -2, or successor
regulations. Unless another definition of compensation that is
permitted by Treasury Regulations Section 1.415(c) -2, or
successor regulation, is specified by the system, compensation
will be defined as wages within the meaning of Code Section
3401(a) and all other payments of compensation to an employee
by an employer for which the employer is required to furnish the
employee a written statement under Code Sections 6041(d),
6051(a)(3) and 6052 and will be determined without regard to any
rules under Code Section 3401(a) that limit the remuneration
included in wages based on the nature or location of the
employment or the services performed (such as the exception for
agricultural labor in Code Section 3401(a)(2).
1. However, for calendar years beginning after December 31,
1997, compensation will also include amounts that would
otherwise be included in compensation but for an election
under Code Sections 125(a), 402(e)(3), 402(h)(1)(B),
402(k), or 457(b). For calendar years beginning after
December 31, 2000, compensation will also include any
elective amounts that are not includible in the gross
income of the employee by reason of Code Section
132(f)(4).
2. For limitation years beginning on and after January 1,
2007, compensation for the calendar year will also include
compensation paid by the later of 2 months after an
employee's severance from employment or the end of the
calendar year that includes the date of the employee's
severance from employment if:
(i). the payment is regular compensation for services
during the employee's regular working hours, or
compensation for services outside the employee's
regular working hours (such as overtime or shift
differential), commissions, bonuses or other similar
payments, and, absent a severance from
employment, the payments would have been paid
to the employee while the employee continued in
employment with the employer; or
(ii) the payment is for unused accrued bona fide sick,
vacation or other leave that the employee would
have been able to use if employment had
continued.
3. Back pay, within the meaning of Treasury Regulations
Section 1.415(c)- 2(g)(8), shall be treated as compensation
for the limitation year to which the back pay relates to the
extent the back pay represents wages and compensation
that would otherwise be included under this definition.
d. Notwithstanding any other provision of law to the contrary, the
board may modify a request by a member to make a contribution
to the system if the amount of the contribution would exceed the
limits provided in Code Section 415 by using the following
methods:
1. If the law requires a lump sum payment for the purchase of
service credit, the board may establish a periodic payment
deduction plan for the member to avoid a contribution in
excess of the limits under Code Sections 415(c) or 415(n).
2. If payment pursuant to subparagraph (j) (4)a. will not avoid
a contribution in excess of the limits imposed by Code
Section 415(c), the board may either reduce the member's
contribution to an amount within the limits of that section or
refuse the member's contribution.
(11) Additional Limitation on Pension Benefits. Notwithstanding anything
herein to the contrary:
a. The normal retirement benefit or pension payable to a retiree who
becomes a member of the system and who has not previously
participated in such system, on or after January 1, 1980, shall not
exceed one hundred percent (100 of his average final
compensation. However, nothing contained in this section shall
apply to supplemental retirement benefits or to pension increases
attributable to cost -of- living increases or adjustments.
b. No member of the system shall be allowed to receive a retirement
benefit or pension which is in part or in whole based upon any
service with respect to which the member is already receiving, or
will receive in the future, a retirement benefit or pension from a
different employer's retirement system or plan. This restriction
does not apply to social security benefits or federal benefits under
Chapter 67, Title 10, and U.S. Code.
(m) Minimum distribution of benefits.
(1) General rules.
a. Effective date. Effective as of January 1, 1989, the plan will pay
all benefits in accordance with a good faith interpretation of the
requirements of Code Section 401(a)(9) and the regulations in
effect under that section, as applicable to a governmental plan
within the meaning of Code Section 414(d). Effective on and after
January 1, 2003, the plan is also subject to the specific provisions
contained in this section. The provisions of this section will apply
for purposes of determining required minimum distributions for
calendar years beginning with the 2003 calendar year.
b. Precedence. The requirements of this section will take
precedence over any inconsistent provisions of the plan.
c. TEFRA section 242(b) (2) elections. Notwithstanding the other
provisions of this section other than this subsection (1)c.,
distributions may be made under a designation made before
January 1, 1984, in accordance with section 242(b)(2) of the Tax
Equity and Fiscal Responsibility Act (TEFRA) and the provisions
of the plan that related to Section 242(b)(2) of TEFRA.
(2) Time and manner of distribution.
a. Required beginning date. The member's entire interest will be
distributed, or begin to be distributed, to the member no later than
the member's required beginning date which shall not be later
than April 1 of the calendar year following the later of the calendar
year in which the member attains age seventy and one -half (70
or the calendar year in which the member terminates employment
with the city.
b. Death of member before distributions begins. If the member dies
before distributions begin, the member's entire interest will be
distributed, or begin to be distributed no later than as follows:
1. If the member's surviving spouse is the member's sole
designated beneficiary, then distributions to the surviving
spouse will begin by December 31 of the calendar year
immediately following the calendar year in which the
member died, or by a date on or before December 31 of
the calendar year in which the member would have
attained age 70 1 /2, if later, as the surviving spouse elects.
2. If the member's surviving spouse is not the member's sole
designated beneficiary, then, distributions to the
designated beneficiary will begin by December 31 of the
calendar year immediately following the calendar year in
which the member died.
3. If there is no designated beneficiary as of September 30 of
the year following the year of the member's death, the
member's entire interest will be distributed by December
31 of the calendar year containing the fifth anniversary of
the member's death.
4. If the member's surviving spouse is the member's sole
designated beneficiary and the surviving spouse dies after
the member but before distributions to the surviving
spouse begin, this subsection (2) b., other than subsection
(2) b.1., will apply as if the surviving spouse were the
member.
For purposes of this subsection (2) b. and subsection (5),
distributions are considered to begin on the member's
required beginning date or, if subsection (2) b.4. applies,
the date of distributions are required to begin to the
surviving spouse under subsection (2) b.1. If annuity
payments irrevocably commence to the member before the
member's required beginning date (or to the member's
surviving spouse before the date distributions are required
to begin to the surviving spouse under subsection (2)b.1.)
the date distributions are considered to begin is the date
distributions actually commence.
c. Death After Distributions Begin. If the member dies after the
required distribution of benefits has begun, the remaining portion
of the member's interest must be distributed at least as rapidly as
under the method of distribution before the member's death.
d. Form of distribution. Unless the member's interest is distributed in
the form of an annuity purchased from an insurance company or
in a single sum on or before the required beginning date, as of the
first distribution calendar year distributions will be made in
accordance of with this section. If the member's interest is
distributed in the form of an annuity purchased from an insurance
company, distributions there under will be made in accordance
with the requirements of section 401(a)(9) of the Code and
Treasury regulations. Any part of the member's interest which is
in the form of an individual account described in section 414(k) of
the Code will be distributed in a manner satisfying the
requirements of section 401(a)(9) of the Code and Treasury
regulations that apply to individual accounts.
Determination of amount to be distributed each year.
a. General requirements. If the member's interest is paid in the form
of annuity distributions under the plan, payments under the
annuity will satisfy the following requirements:
1. The annuity distributions will be paid in periodic payments
made at intervals not longer than one year.
2. The member's entire interest must be distributed pursuant
to F.S. Sec.185.16, Sec. 185.21, Sec. 185.19, or Sec.
185.161 (as applicable) and in any event over a period
equal to or less than the member's life or the lives of the
member and a designated beneficiary, or over a period not
extending beyond the life expectancy of the member or of
the member and a designated beneficiary. The life
expectancy of the member, the member's spouse, or the
member's beneficiary may not be recalculated after the
initial determination for purposes of determining benefits.
b. Amount required to be distributed by required beginning date.
The amount that must be distributed on or before the member's
required beginning date (or, if the member dies before
distributions begin, the date distributions are required to begin
under F.S. Sec. 185.21.) is the payment that is required for one
payment interval. The second payment need not be made until
the end of the next payment interval even if that payment interval
ends in the next calendar year. Payment intervals are the periods
for which payments are received, e.g., monthly. All of the
member's benefit accruals as of the last day of the first distribution
calendar year will be included in the calculation of the amount of
the annuity payments for payment intervals ending on or after the
member's required beginning date.
c. Additional accruals after first distribution calendar year. Any
additional benefits accruing to the member in a calendar year after
the first distribution calendar year will be distributed beginning with
the first payment interval ending in the calendar year immediately
following the calendar year in which such amount accrues.
(4) General distribution rules.
a. The amount of an annuity paid to a member's beneficiary may not
exceed the maximum determined under the incidental death
benefit requirement of Code Section 401(a)(9)(G), and effective
for any annuity commencing on or after January 1, 2008, the
minimum distribution incidental benefit rule under Treasury
Regulation Section 1.401(a)(9) -6, Q&A -2.
b. The death and disability benefits provided by the plan are limited
by the incidental benefit rule set forth in Code Section
401(a)(9)(G) and Treasury Regulation Section 1.401- 1(b)(1)(I) or
any successor regulation thereto. As a result, the total death or
disability benefits payable may not exceed 25% of the cost for all
of the members' benefits received from the retirement system.
(5) Definitions.
a. Designated beneficiary. The individual who is designated as the
beneficiary under the plan and is the designated beneficiary under
section 401(a) (9) of the Code and section 1.401(a) (9) -1, Q &A -4,
of the Treasury regulations.
b. Distribution calendar year. A calendar year for which a minimum
distribution is required. For distributions beginning before the
member's death, the first distribution calendar year is the calendar
year immediately preceding the calendar year which contains the
member's required beginning date. For distributions beginning
after the member's death, the first distribution calendar year is the
calendar year in which distributions are required to begin pursuant
to F.S. Sec. 185.21.
(n) Miscellaneous provisions.
(1) Interest of members in plan. All assets of the fund are held in trust,
and at no time prior to the satisfaction of all liabilities under the plan with
respect to retirees and members and their spouses or beneficiaries, shall
any part of the corpus or income of the fund be used for or diverted to any
purpose other than for their exclusive benefit.
(2) No reduction of accrued benefits. No amendment or ordinance
shall be adopted by the city commission of the City of Sebastian which
shall have the effect of reducing the then vested accrued benefits of
members or a member's beneficiaries.
Prohibited Transactions. Effective as of January 1, 1989, a board may
not engage in a transaction prohibited by Code Section 503(b).
(6) USERRA. Effective December 12, 1994, notwithstanding any other
provision of this system, contributions, benefits and service credit with
respect to qualified military service are governed by Code Section 414(u)
and the Uniformed Services Employment and Reemployment Rights Act
of 1994, as amended. To the extent that the definition of "credited
service" sets forth contribution requirements that are more favorable to
the member than the minimum compliance requirements, the more
favorable provisions shall apply.
(5)
(3) Qualification of plan. It is intended that the plan will constitute a
qualified public pension plan under the applicable provisions of the
Internal Revenue Code for a qualified plan under Code Section 401(a)
and a governmental plan under Code Section 414(d), as now in effect or
hereafter amended. Any modification or amendment of the plan may be
made retroactively, if necessary or appropriate, to qualify or maintain the
plan as a plan meeting the requirements of the applicable provisions of
the Internal Revenue Code as now in effect or hereafter amended, or any
other applicable provisions of the U.S. federal tax laws, as now in effect
or hereafter amended or adopted, and the regulations issued there under.
(4) Use of forfeitures. Forfeitures arising from terminations of service
of members shall serve only to reduce future city contributions.
(7) Vesting.
a. Member will be 100% vested in all benefits upon attainment of the
plan's age and service requirements for the plan's normal
retirement benefit; and
b. A member will be 100% vested in all accrued benefits, to the
extent funded, if the plan is terminated or experiences a complete
discontinuance of employer contributions.
(8) Electronic Forms. In those circumstances where a written election or
consent is not required by the plan or the Code, an oral, electronic, or
telephonic form in lieu of or in addition to a written form may be
prescribed by the board. However, where applicable, the board shall
comply with Treas. Reg. 1.401(a) -21.
(o) Direct transfers of eligible rollover distributions; Elimination of mandatory
distributions.
(1) Rollover distributions.
a. General. This subsection applies to distributions
made on or after January 1, 2002. Notwithstanding any
provision of the system to the contrary that would
otherwise limit a distributee's election under this
subsection, a distributee may elect, at the time and in the
manner prescribed by the board, to have any portion of an
eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct
rollover.
b. Definitions.
1. Eligible rollover distribution: An eligible
rollover distribution is any distribution of all or any portion
of the balance to the credit of the distributee, except that
an eligible rollover distribution does not include: any
distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made
for the life (or life expectancy) of the distributee or the joint
lives (or joint life expectancies) of the distributee and the
distributee's designated beneficiary, or for a specified
period of ten (10) years or more; any distribution to the
extent such distribution is required under 401(a)(9) of the
Internal Revenue Code and the portion of any distribution
that is not includible in gross income. Effective January 1,
2002, any portion of any distribution which would be
includible in gross income as after -tax employee
contributions will be an eligible rollover distribution if the
distribution is made to an individual retirement account
described in 408(a) of the Internal Revenue Code; to an
individual retirement annuity described in 408(b) of the
Internal Revenue Code; to a qualified defined contribution
plan described in 401(a) or 403(a) of the Internal
Revenue Code that agrees to separately account for
amounts so transferred (and earnings thereon), including
separately accounting for the portion of such distribution
which is includible in gross income and the portion of such
distribution which is not so includible; or on or after
January 1, 2007, to a qualified defined benefit plan
described in Code Section 401(a) or to an annuity contract
described in Code Section 403(b), that agrees to
separately account for amounts so transferred (and
earnings thereon), including separately accounting for the
portion of the distribution that is includible in gross income
and the portion of the distribution that is not so includible.
2. Eligible retirement plan: An eligible
retirement plan is an individual retirement account
described in 408(a) of the Internal Revenue Code; an
individual retirement annuity described in 408(b) of the
Internal Revenue Code; an annuity plan described in
403(a) of the Internal Revenue Code; effective January 1,
2002, an eligible deferred compensation plan described in
457(b) of the Internal Revenue Code which is maintained
by an eligible employer described in 457(e)(1)(A) of the
Internal Revenue Code and which agrees to separately
account for amounts transferred into such plan from this
plan; effective January 1, 2002, an annuity contract
described in 403(b) of the Internal Revenue Code; a
qualified trust described in 401(a) of the Internal
Revenue Code; or effective January 1, 2008, a Roth IRA
described in Section 408A of the Internal Revenue Code,
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that accepts the distributee's eligible rollover distribution.
This definition shall apply in the case of an eligible rollover
distribution to the surviving spouse.
3. Distributee: A distributee includes an
employee or former employee. It also includes the
employee's or former employee's surviving spouse and the
employee's or former employee's spouse or former
spouse. Effective January 1, 2007, it further includes a
non spouse beneficiary who is a designated beneficiary as
defined by Code Section 401(a) (9) (E). However, a non
spouse beneficiary may rollover the distribution only to an
individual retirement account or individual retirement
annuity established for the purpose of receiving the
distribution and the account or annuity will be treated as an
"inherited" individual retirement account or annuity.
4. Direct rollover: A direct rollover is a payment
by the plan to the eligible retirement plan specified by the
distributee.
(2) Rollovers or transfers into the fund. On or after January 1, 2002, the
system will accept, solely for the purpose of purchasing credited service
as provided herein, permissible Member requested transfers of funds
from other retirement or pension plans, member rollover cash
contributions and /or direct cash rollovers of distributions made on or after
January 1, 2002, as follows:
a. Transfers and direct rollovers or member rollover contributions
from other plans. The system will accept either a direct rollover of
an eligible rollover distribution or a member contribution of an
eligible rollover distribution from a qualified plan described in
section 401(a) or 403(a) of the Code, from an annuity contract
described in section 403(b) of the Code or from an eligible plan
under section 457(b) of the Code which is maintained by a state,
political subdivision of a state, or any agency or instrumentality of
a state or political subdivision of a state. The system will also
accept legally permissible member requested transfers of funds
from other retirement or pension plans.
b. Member rollover contributions from IRAs. The system will accept
a member rollover contribution of the portion of a distribution from
an individual retirement account or annuity described in section
408(a) or 408(b) of the Code that is eligible to be rolled over.
(3) Elimination of mandatory distributions. Notwithstanding any other
provision herein to the contrary, in the event this plan provides for a
mandatory (involuntary) cash distribution from the plan not otherwise
required by law, for an amount in excess of one thousand dollars
($1,000.00), such distribution shall be made from the plan only upon
written request of the member and completion by the member of a written
election on forms designated by the board, to either receive a cash lump
sum or to rollover the lump sum amount.
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Section 2: This Ordinance shall take effect immediately upon passage.
Section 3: CONFLICT. All ordinances or parts of ordinances in conflict herewith
are hereby repealed.
The foregoing Ordinance was moved for adoption by Councilmember
Hill The motion was seconded by Councilmember
Coy and, upon being put to a vote, the vote was as follows:
ATTEST:
Mayor Richard H. Gillmor aye
Vice -Mayor Jim Hill aye
Councilmember Andrea B. Coy aye
Councilmember Eugene Wolff aye
Councilmember Don Wright aye
The Mayor thereupon declared this Ordinance duly passed and adopted this 25th day of
August 2010.
417))
Sally A. M io, MMC
City Cler
CITY OF SEBASTIAN, F ORIDA
B
hard H. Gillmor
Approved as to form and legality for
reliance by the City of Sebastian only:
Robert Ginsburg, City Attorney
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