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HomeMy WebLinkAbout37-77 RESOLUTIONir d RESOLUTION NO. 5T/ -'9'j 0' A RESOLUTION AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE AN AMENDED AND RESTATED SPLIT FUNDED DEFINED BENEFIT ADOPTION AGREEMENT FOR EMPLOYEES OF THE CITY OF FAYETTEVILLE. BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF FAYETTEVILLE, ARKANSAS: That the Mayor and City Clerk be, and they hereby are, authorized and directed to execute an amended and restated split funded defined benefit adoption agreement for employees of the City of Fayetteville. A copy of said agreement, marked Exhibit "A", is attached hereto and made a part hereof. PASSED AND APPROVED THIS // DAY OF (at/,u , 1977. APPROVED: UU MAYOR ATTEST,: CITY CLERIC ` UAL -et eu.e.a-tr MICROFILMED 1 T 3 979 DATE � REEL MICROFILMED er� DATE p; r 2 a 1916 REEL II tt /A. CIRCLE 0 SPECIFICATIONS, SU?'t4ARY PLAN DESCRIPTION, ADOPTION AGREEMENT, RETIREMENT PLAN, AND TRUST cu For eligible employees of: CITY OF FAYETTEVILLE FAYETTEVILLE, ARKANSAS AS AMENDED AND RESTATED EFFECTIVE MAY 31, 1977 t - 37- 77 MORTON & COMPANY. INC. PENSION ACTUARIES, CONSULTANTS ANO ADMINISTRATORS P. O. DRAWER 1567 /F AYE TTE VIII E. ARKANSAS 72101 /TE LE RHONE 507-S21.43PS RESOLUTION J A regular meeting of the Board of Directors of the City of Fayetteville was held at the Administration Building, Fayetteville, Arkansas 72701 on , 19 at . . The following Directors were present: • Presiding was Acting as City Clerk was On motion duly made, seconded and carried, the following resolution was approved: RESOLVED, that the Adoption Agreement, Plan and Trust (a copy of which is attached hereto and incorporated herein designated as the City of Fayetteville Retirement Plan) is hereby adopted as the Retirement Plan and Trust of the City of Fayetteville as of May 31, 1977; same being a continua- tion of the Plan previously adopted as amended and restated herein; and BE IT FURTHER RESOLVED, that the Attorney for the City of Fayetteville be, and is hereby, authorized and directed to prepare and/or approve such legal instruments and/or other documents as may be necessary or required to effectuate the City of Fayetteville Retirement Plan in full force and effect. A1'1 EST: City Clerk Mayor • i SPECIFICATIONS CITY OF FAYETTEVILLE AMENDED & RESTATED RETIREMENT PLAN EFFECTIVE DATE: ELIGIBILITY: REFIREEC BENEFIT FORMULA: NOR-LAL RETIRD E:`T BENEFIT• DEATH BENEFIT BEFORE RETIREMENI: TOTAL AND PERMANENT DISABILITY: VESTING: LIFE INSURANCE TYPE: Hay 31, 1977 Non-uniform Employees age 25 (nearest birthday) with 2 years of employment, and who were not over age 60 when employed, and who are not covered by a collective bargaining agreement with an organization with whom the City has bargained good faith for retirement benefits. One and one-half percent (11/2%) of Final Average Compensation multiplied by Years of Credited Ser- vice. Past service limited to 5 years prior to May 31, 1958. Average compensation is highest 5 consecutive years during ten years preceeding retirement. Monthly payments for 60 months certain and t ere - after for life. 67 times the Participant's Retirement Benefit (subject to insurability standards of insurance company) or Present Value of his Accrued Benefit whichever is greater. Disability provisions of individual's insurance policy or the Present Value of his Accrued Bene- fit, whichever is greater. Less than 5 years service, 0% 5 years 25% with an increase of 5% per year for the next 5 years and an increase. of 10% per year for the next 5 years. Age 55 and 10 years, 100. Full vesting at all times for benefits attribu- table to Employee contributions. Group Term Life Insurance. EMPLOYEE CONTRIBUTIONS: Three (3) percent of Current Compensation. • INPLOYER CONFRICUTIOJS: Ralancc required to provide benefits. PAY?E;F OF RETIRE.*tNf BENEFITS: JOINT AND SURVIVOR BENEFIT• Participant may elect with consent of City to receive retirement payments under a variety of options, including lump sus. If no option is elected, retirement benefit is automatically paid under this option. It is a reduced benefit payable for as long as the Par- ticipant lives with 50& being continued for as long thereafter as his spouse lives. EARLY RETIREMENT• Permitted at age 55 with ten years of service. Early benefit is actuarially reduced. POSTPONED RETIREMEENf- Permitted with consent of City. Postponed retire- ment benefit is actuarial equivalent of Nor..al Retirement Benefit. RETIREMENT PLAN FOR THE EMPLOYEES OF CITY OF FAYETTEVILLE SUMMARY PLAN DESCRIPTION It is the desire of the City to provide retirement benefits for its employees when they reach retirement age. This amended plan is effec- tive as of May 31, 1977, and, with the exception of eligibility, is designed to comply with the Employee Retirement Income Security Act of 1974. The most important provisions are as follows: WHO IS ELIGIBLE TO PARTICIPATE? All non -uniformed Employees become eligible to participate on the effec- tive date or on the first Plan Anniversary (May 31) following the day they complete the following requirements: 1. Every Participant in the Prior Plan who was a Par- ticipant on May 30, 1977, shall continue to be a Participant in this Plan. 2. Attains age 25 nearest birthday. 3. Was not over age 60 when employed. 4. Completes two (2) years of employment with the City. 5. Completes necessary application forms provided b; the City. 6. Is not covered by a collective bargaining agreement with whom the City has bargained in good faith for Retirement benefits. An Employee shall become eligible for life insurance coverage upon becoming a Participant hereunder. Such insurance shall be equal to one hundred (100) times the Anticipated Normal Retirement Benefit for Participants who submit evidence of insurability, or for whom such evidence is waived. NORMAL RETIREMENT BENEFIT The Normal Retirement Benefit is payable for five (5) years certain and as long as you live thereafter. You will be given a choice of other:Options available prior to your Normal Retirement Date. If you are married, you will be able to select a Joint and Survivor Annuity in which case your monthly benefit will be reduced, but your spouse (husband or wife) will receive one-half (l) of what would be paid you while you both are living (for as long as he or she shall live). Should you make no other selection, this Joint and Survivor Annuity becomes automatic. The amount of the monthly benefit (rounded to the nearest $1.00) paid to a Participant who retires at his Normal Retirement Date will be 1 a equal to 11/2of Final Average Compensation multiplied by Years of Credited Service. Credited Service prior to May 31, 1968, shall be limited to five (5) years. All other service shall count, with six (6) full months or longer being considered a full year. The Current Compensation on which the Anticipated Normal Retirement Benefit shall be based is basic pay received by the Employee from the Employer, exclusive of bonuses, overtime and other non-recurring forms of compensation. Final Average Compensation for the purpose of determining the Partici- pant's Actual (as opposed to Anticipated) Normal Retirement Benefit shall be the Participant's total Average Monthly Compensation received from the Employer during the highest five (5) consecutive calendar years in the ten (10) years immediately prior to his retirement, or during his total service if less than five (5) years. Example: Assume you started to work for the City at age 53 and retired at age 65. During the last ten (10) years prior to age 65 your average monthly compensation during the highest five (5) consecutive years was $800. Your monthly pension would be computed as follows: Basic benefit = 1'% x $800 x 12 years = $144 WHEN DO PAYMENTS START? The Normal Retirement Age is the first day of the :month coincident with or next following the Participant's 65th birthday. With the consent of the Employer, a Participant may elect to postpone his Actual Date of Retirement to the first day of any month following his Normal Retirement Date, and in such event, no further contributions will be made in his behalf for the additional period. Payment of Retirement Benefits shall commence on the Participant's Actual Retirement Date. Upon written request, a Participant may be granted Early Retirement with the consent of the Employer, provided he has attained age 55 and has completed ten (10) Years of Service under the Plan. RETTREm NT BENEFITS ON OTHER THAN NORMAL RETIREMENT DATE If you postpone your retirement beyond your Normal Retirement Date, the benefit commencing when you retire will be the Actuarial Equivalent of yo'r Normal Retirement Benefit. This means that the amount of your monthly pension benefit will be increased due to interest that will be earned on the value of your retirement benefit and to a reduction in the number of years you will be expected to receive benefits. If you choose Early Retirement, your benefits will be the Actuarial Equivalent of your Accrued Benefit, determined as of the date of Early Retirement. This means that the amount of your monthly pension benefit will be reduced due to the increase in the number of years you will be 2 4 1 3. expected to receive benefits, and due to a lesser amount being paid into the Plan by the City (contributions cease when a Participant retires, whether it is an Early Retiret;ent or Normal Retirement). WHAT IS AN ACCRUED BENEFIT? An Accrued Benefit is your Anticipated Retirement Benefit multiplied by a fraction, the numerator of which is the number of years you have par- ticipated in the Plan and the denominator of which is the number of years you would have participated had you continued to work until normal Retire- ment Age. WHEN DOES THIS BECOME NON -FORFEITABLE? A Participant is always 100% vested in the portion of his Accrued Benefit attributable to his own contribution. In the event employment of a Participant is terminated for any reason other than death, disability or retirement, the percentage of the Accrued Benefit from Employer contributions, which shall be non -forfeitable, is as follows: Number of Full Years of Participation Percentage Vested Less than 5 0„ 5 25% 6 30% 7 35% 8 40/, .9 45% 10 50% 11 60% 12 70% 13 80% 14 90% 15 100% Age 55 and 10 years 100% The Present Value of a Participant's vested interest in his Accrued Benefit may be paid in one sum on termination of employment on written request from the Participant and approval of the Employer. All Employees in like cir- cumstances shall be treated in like manner. WHAT SERVICE IS CREDITED.? In computing the period of service for purposes of determining the non - forfeitable percentage, any twelve (12) consecutive month period starting with the Date of Employment or any Anniversary thereof, with the Employer during which he has completed 1,000 hours or more, shall be taken into account, except the following: 1. Service prior to a Break in Service until he has com- ti. pleted one (1) Year of Service with the Employer, after his return. 3 • e r 2. All periods during where there has been a "Break in Service." 3. All periods prior to a "Break in Service" where the numbers of "Breaks in Service" equals or exceeds the periods of service prior to the "Breaks in Service." 4. Periods during which the Employer did not maintain a Plan, or a Predecessor Plan. For Benefit Accrual each year under the Plan during which you have completed 1,000 hours or more will be counted. WHAT IS BREAK IN SERVICE?" A "Break in Service" shall mean any twelve (12) month period starting with the date of employment or any anniversary thereof during which a Participant has not completed more than five hundred (500) hours of service. pap 8.03 Should you have a "Break in Service" and then later return to work, you will again be a Participant in the Plan, but you will not be credited with your past service until one year after your re—employment. At that time, you will be credited with your past service as well as with service during the one year wait unless the total "Breaks in Service" equal or exceed the years of past service, in which case you will lose your past service. Should you have withdrawn your vested benefits when incurring a "Break in Service" your final benefits will be reduced accordingly unless the amount withdrawn is repaid with interest at five percent (5%) compounded annually to the date of re -payment. SUPPOSE I SHOULD DIE? In the event of your death prior to your Normal Retirement Date, the amount payable to your Beneficiary shall be the face amount of the insurance on your life under the Plan, if any, or the Present Value of your Accrued Pension Benefit, whichever is greater. SUPPOSE I BECOME DISABLED? The amount of which you shall be entitled hereunder by reason of becoming permanently and totally disabled shall be that which 1s pro- vided under a Permanent and Total Disability provision contained in the insurance policy issued on your life, if any, or the Present Value of your Accrued Benefit, whichever is greater. WHO PAYS THESE BENEFITS? Each Participant shall contribute 3% of his compensation, deducted monthly, and the City shall contribute the balance necessary to provide all benefits of the Plan. 4 1 T CONCLUSION I This brief description of your Plan is intended to give you the most important details. Any variance between this description and the Plan Document itself will be controlled by the Plan Document. This can be examined by you at the business office of the City of Fayetteville, City Administration Building, Fayetteville, Arkansas 72701, at any time during regular business hours; and we will be glad to answer any ques- tions you may have regarding it. DATE CITY OF FAYETTEVILLE 5 BY SPLIT FUNDED DEFINED BENEFIT ADOPTION AGREEMENT FOR THE EMPLOYEES OF CITY OF FAYETTEVILLE FAYE11EVILLE, ARKANSAS (AMENDED AND RESTATED) • • • r FORWARD 1 ADOPTION A G R E E M E N 1 TABLE OF COME.\TS PART 1 ADJMINISTRATIVE MATTERS (Plan Ref: Secs. 2.16, 2.18, 2.20, 2.29, 15.01) PART II ELIGIBILITY (Plan Ref: Sec. 3.01) PART III RETIREMENT AGES AND DATES (Plan Ref: Secs. 2.30, 4.01) ii Page PRT IV NORMAL RETIREMENT BENEFIT (Plan Ref: Secs. 2.13, 5.02) Pa,e iii PART V VESTING (Plan Ref: Sec. 9.04) PART VI DEATH AND DISABILITY BENEFITS (Plan Ref: Secs. 5.05, 6.01) PART VII FUNDING (Plan Ref: Secs. 5.11, 12.01, 12.02) PART VIII RETIREMENT BENEFITS ON OTHER THAN NORMAL RETIREMENT DATE (Plan Ref: Secs. 5.03, 5.04 PART IX NATURE OF AGREEMENT (Trust Ref: Sec. 8.02) SIGNATURE PAGE Pa,= Pace Page vi Page vii Page vii t 11➢: CITY OF FAYETTEVILLE A DEFINED BENEFIT PLAN AND TRUST ADOPTION AGREB ENT • WHEREAS, the Employer, a Governmental Unit with its principal place cf business in Fayetteville, Arkansas, created on Hay 31, 1958 an Employee Re- tirement Plan, and 11-IERE4S, the Employer now desires to amend its Retirement Plan to accomplish the purposes set forth below: NOW, THEREFORE, by executing this Adoption Agreement, the Erplo,e_ ;_cre- by establishes an amended Plan and Trust attached hereto and expressly incorp- orated herein, for the following purposes, to wit: 1. To redesign the Plan. 2. To create a Trust to hold, invest, reinvest and otherwise to manage the assets of the Plan as amended. 3. To restate the Plan in a separate document from a policy of insurance. 4. To amend and continue the Predecessor Plan. The Trustees and the Plan Administrator, by joining in the execution of this Adoption Agreement, accept the responsibilities imposed on them and agree to perform their duties under this Plan. As part of this Plan, the Employer makes the following statements: (i) • • • x s PARI 1 AJY1INISIRATIVE HAITER.S A. The Name of this Plan shall be: CITY OF FAYETTEVILLE RETIRF1qENF PLN! B. The Trustee appointed at this time is: Mcllroy Bank and Trust . 75 North East Street P. 0. Box 1367 Fayetteville, Ark. 72701 C. The Plan Administrator shall be the Employer. D. The Person available for Service of Process is: (501)521-7400 City Manager City of Fayetteville City Administration Bldg. Fayetteville, Ark. 72701 (501)521-7700 E. The Named Fiduciary shall be the City of Fayetteville. F. As used herein, the term "Employer" shall mean City of Fayetteville. G. The Effective Date of this Adoption Agreement, as well as the Plan and Trust, both incorporated herein is May 31, 1977. PART II ELIGIBILITY A. Every Employee, who is not an Employee of the Fayetteville Police Depart- ment or the Fayetteville Fire Department, shall become eligible to parti- cipate on the effective date or on the first Plan Anniversary thereafter following the day he completes the following requirements: 1. Every Participant who was a Participant in the Prior Plan on Mlay 30, 1977 shall continue to be a Participant in this Plan. 2. Attains age 25 nearest birthday. 3. 11as not age 60 or over on his Date of Employment. 4. Has completed twenty-four (24) months of employment with the Employer. 5 Has agreed to make the required contributions. 6. Employees not included in a unit of Employees covered by an agreement which the Secretary of Labor finds to be a collet-: tive bargaining agreement between Employee representatives C and one or more Employers, if there is evidence that retire- ment benefits were the subject of good faith bargaining be- tween such Employee representatives and such frigrlovcr. 11. The Participant shall become eligible for the life insurance specifics in Article VII upon becoming a Participant hereunder. Such insurance shall be Group Term life insurance, equal to 100 times his Anticipated Normal Retirement Benefit. PART III RETIREMNT AGES AND DATES A. The Normal Retirement Age is 65. The Normal Retirement Date shall be the first day of the month coincident with or next following the Parti- cipant's sixty-fifth (65th) birthday. B. A Participant may elect to postpone his Actual Date of Retirement to the first day of any month following his Normal Retirement Date, and in such event, no further cont;ibutions will be made in his behalf for the additional period. The consent of the Employer shall be required for the Particicant to postpone his Actual Date of Retirement. Payment of retirement benefits shall commence cn the Participant's Actual Retirement Date. Upon written request, a Participant may be granLed Early Retirement with the consent of the Employer, provided he is within 10 years of his Neral Retirement Date, and is 100% vested in his Accrued Senefit. PART TV NORMAL RETIRE:ENrI BENEFIT A. The Normal Retirement Benefit shall be a monthly benefit payable for sixty (60) months certain and for as long thereafter as the Participant shall live. B. The amount of such Normal Retirement Benefit commencing at a Partici- pant's Normal Retirement Date shall be one and one-half percent (1<%) of Final Average Compensation multiplied by years of Credited Service. C. The maximum number of Years of Credited Service to be taken into accent in determining a Participant's Normal Retirement Benefit shall be limit- ed to a maximum of five (5) years prior to 5-31-58. All other service with the City shall be included as Credited Service. D. Benefits as computed under the above formula shall be rounded to the nearest $1.00. • C • r 1 , E. The Monthly Current Compensation on which the Anticipated Norm_ Re- tirement Benefit shall be based is basic pay exclusive of bonuses, overtime and other nonrecurring forms of compensation. • F. Final Average Compensation for the purpose of determining the Par- ticipant's Actual (as opposed to Anticipated) Normal Retirement Bene- fit shall be the Participant's Average Monthly Compensation received from the Employer during the highest five (5) consecutive calendar years in the ten (10) years immediately prior to his retirement, or during his total service if less than five (5) years, suet -I. -total compensation to be that shown on the Participant's lei -2 Form each year. G. Notwithstanding the retirement benefits as spelled out in t.._ Adoption Agreement and Plan, there shall be no miniuum or max- imum benefits other than those set forth in the Plan. PART V VESTING In the event employment of a Participant is terminated as provided =r. Article VIII, the percentage of vesting in the Accrued Benefit a butable to Employer contributions shall be as foliows: Number of Full Years of Service Percentage Vested Less than 5 0` 5 25: 6 3C' 7 35% 8 40 9 45; 10 50% 11 60% 12 70% 13 80% 14 90% 15 100% Age 55 with 10 years under Plan 100% Notwithstanding anything herein to the contrary, a Participant shall be 100% vested in his Accrued Benefit when he reaches his Nornal Retirement Age. The Present Value of a Participant's vested interest in his Accrued Benefit may be paid in one sum on termination of employment on written request fro-. the Participant and approval of the Employer. All Employees in like cir- cumstances shall be treated in like manner. In computing the period of service for purposes of determining the n_.. - forfeitable percentage under this Part of the Adoption Agreement ail of an Employee's Years of Service with the Employer shall be taken to account except the following: a 1 1 Service prior to a Breal. in Service until he has complete: one year of service with the Employer, atter his retur;.. All periods during which there has been a "Break in Ser- viee". 3. All periods prior to a "Break in Service" where the number: of "Breaks in Service" equals or exceeds the periods of service prior to the "Breaks in Service". 4. Periods during which the Employer did not raintain a Plan, or a Predecessor Plan. 5. Periods during which an Employee declined to rake man^a-or: contributions, if any are required. 6. An Employee working simultaneously for two or more Employers will not have his period of service increased by reason of such simultaneous employment. PART \'1 DEATH AND DISABILITY BENEFITS A. DEATH BENEFITS: In the event of a Participant's death prior to his Normal Retirement Date, the amount payable to his Beneficiary shall be the face amount of the insurance en his life under the Plan, if any, or the Present Value of his Accrued Pension Bene=_:, whichever is greater. B. DISABILITY BENEFITS: The amount to which a Participant shall be entitled nereuncter by reason of becoming permanently and totall disabled shall be that which is provided under a Permanent and Total Disability provision contained in the insurance policy issued on his life under the Plan, if any, or the Present Value of his Accrued Benefit, whichever is greater. Such amount shall be paid first from such insurance policy and any additional amount due hereunder shall be paid from the Trust Fund. Any amount due from such insurance policy shall be paid in accordance with the terms of such policy and any amount paid from the Trust Fund shall be paid in equal monthly installments for a period of five (5) years or longer, in accordance with the options contained in Section s.0;. The policies of Life Insurance issued on the lives of Participants hereunder shall, wherever possible, contain a permanent and total disability provision which shall provide, as nearly as possible, for the payment of the face amount of such insurance, in the event of the permanent and total disability of such Participant before age sixty (60), in the form o: monthly installments. (v) • • PART 111 FUND ;:f This Plan shall be funded by joint contributions of the Emplo)er an:' Participant with each Participant contributing 3% of his Current Compt.;- sation, and the Employer contributing the balance necessary to fund the benefits provided hereunder. Voluntary contributions will not be permitted. Employee mandatory contributions shall be first applied to pay the cost of the life insurance protection of any insurance policy issued upon :?te life of such Participant, and the balance, if any, shall be applied to pay the cost of retirement benefits provided hereunder. PART VIII • RETIRFMENT BENEFITS ON OTHER THAN NORMAL REETIRE•Ect DATE A. Should a Participant postpone his retirement beyond his Nora' Retirement Date, the retirement benefit commencing on his Actuai Retirement Date shall be the actuarial equivalent of his Norte Retirement Benefit. B. The amount of a Participant's Early Retirement Benefit shall be the actuarial equivalent of his Accrued Benefit, determined as of His Early Retirement Date. (vi) PART 1 x: NAIIJRE OF AGREE•MD I This Adoption Agreement constitutes Amendment Number 2 to a restaracn. of an existing Plan which is qualified under Section 401(a) of the Internal Revenue Code. The provisions of this Amendment supersede the initial agreement and all Amendments prior to this. Executed at this th day of , 19 Attest: CITY OF FAYETTEVILLE' Eloyer By TRUSTEES: McILROY BA`'K AND TRUST Witness Trustee a SPLIT FUNDED DEFINED BENEFIT MUNICIPAL RETIREMENT PLAN FOR THE EMPLOYEES OF THE CITY OF FAYEII1:VILLE FAYETTEVILLE, ARKANSAS