[HISTORY: Adopted by the Borough Council of the Borough of
Boyertown as indicated in article histories. Amendments noted where
applicable.]
[Adopted 8-3-1987 by Ord.
No. 14-87]
For the purposes of this chapter, the following definitions
shall apply:
Eighty-two and one-half percent of 1% of the number of years
in Subsection A below, as computed to the nearest 1/12 of a year,
up to a maximum of 30 years.
[Amended 7-1-1996 by Ord.
No. 2-96]
The number of years of service between the entry date and the
date of determination.
Act 205 of 1984, the Municipal Pension Plan Funding Standard
and Recovery Act.[1]
Annual basic compensation with the employer as of January
1 in each year, excluding overtime payments, commissions, bonuses
and any other additional compensation.
The original effective date of the plan is January 1, 1971.
The Borough of Boyertown, Berks County, Commonwealth of Pennsylvania.
The anniversary date of one year of service from the date
of employment.
The average compensation on the last five January 1s before
early retirement, termination of employment or retirement.
The Borough of Boyertown Retirement Income Plan Trust Fund.
Any Borough employee who meets the requirements set forth in § 42-4 of this chapter.
The Borough of Boyertown Retirement Income Plan.
January 1 to December 31.
Continuous employment with the employer. Absence from employment
on account of leave of absence authorized by the employer pursuant
to the employer's established leave policy will be counted as
continuous employment with the employer, provided that such leave
of absence is of not more than two years' duration and provided
further that the employee returns to active service with the employer
at the end of such leave of absence. The employer's leave policy
shall be applied in a uniform and nondiscriminatory manner to all
participants under similar circumstances. Absence from employment
on account of active duty with the Armed Forces of the United States
will be counted as continuous employment with the employer, provided
that the employee returns to active service with the employer within
90 days after he becomes eligible for release from such active duty.
[1]
Editor's Note: See 53 P.S. § 895.101 et seq.
This plan is to be funded and maintained by any of the following
methods or combinations of each:
A.
State aid. Funds which are received from the Commonwealth of Pennsylvania
pursuant to Act 205 which are directed to this plan, as approved by
the Borough Council, may be used.
B.
Borough contributions. Contributions from the Borough of Boyertown,
as necessary, with appropriate approval by the Borough Council, may
be used.
C.
Gifts, grants, devises or bequests. The sums which may be received
by the Borough of Boyertown in the form of gifts, grants, devises
or bequests may, to the extent authorized by law, be contributed to
said fund with the approval of the Borough Council.
D.
Any other sums received or contributed to the Borough, to the extent
authorized by law and with prior approval of the Borough Council,
may be used.
A.
Subject to the control and direction of the Borough Council, the
Retirement Income Plan Committee, as appointed by the Borough Council,
shall have full responsibility for administration of the plan and
fund. The Committee shall hold, invest, reinvest and distribute all
funds and property received pursuant thereto in trust for the purposes
of this chapter. The Committee may receive at any time gifts, grants,
devises or bequests to the Retirement Income Plan Trust Fund of any
money or property, real or personal or mixed, to be held by the Committee
in trust for the benefit of this fund and in accordance with the provisions
hereof. The Committee shall be subject to such rules and regulations
as may from time to time be adopted by the Borough Council through
ordinance or resolution.
B.
The Committee shall have full power and authority, either directly
or through its designated representatives, to do all acts, to execute,
acknowledge and deliver all instruments and to exercise for the sole
benefit of the participants hereunder any and all powers and discretions
necessary to implement and effectuate the purposes of this chapter,
including, for purposes of illustration, but not limited to, any of
the following:
(1)
To hold, invest and reinvest all funds received pursuant to this
chapter in such investments as may be authorized as legal investments
under the laws of the Commonwealth of Pennsylvania.
(2)
To retain any property which may at any time become an asset of the
fund, as long as the Committee may deem it advisable.
(3)
To make distribution of the moneys in the fund, in accordance with
the terms of this chapter.
(4)
To appoint a trustee or custodian to hold, invest and reinvest plan
funds in accordance with this chapter. Such trustee or custodian may
be removed or may resign by giving 60 days' written notice to
the other party. The Committee shall maintain the authority to oversee
and review the performance of the trustee or custodian both on an
investment and administrative basis. Plan funds may be invested in
pooled funds designated for employee benefit trust funds.
C.
Any administrative expense which is an allowable administrative expense
under Act 205 of the Commonwealth of Pennsylvania will be payable
from the assets of the fund. If administrative expenses are not or
cannot be paid from the fund, the expense will be paid by the Borough
of Boyertown.
Each regular full-time employee of the Borough whose customary
employment is for more than 30 hours per week will be eligible to
participate on the day when he completes one year of service. No one
will be eligible for this plan if he is hired after his 60th birthday
or if he is a police officer, part-time employee, dispatcher, or member
of a bargaining unit.
The normal retirement date to receive benefits from the fund
shall be the first day of the month coinciding with or next following
the 65th birthday or the completion of 10 years of service, if later.
If a participant is continuing in the employ of the employer after
the normal retirement date, benefit payments will be postponed to
the first day of the month next following the actual date of retirement
and will be in an amount equal to the actuarial equivalent of the
normal retirement benefit.
A.
The basis for determining the amount of annual pension to a participant retiring under § 42-5 shall be 0.825% of the participant's final average compensation multiplied by the number of years in Subsection A(1) below, as computed to the nearest 1/12 of a year, up to a maximum of 30 years.
[Amended 7-1-1996 by Ord.
No. 2-96]
(1)
The number of years of service between the entry date and the normal
retirement date.
B.
Such pension or retirement benefit shall be payable from the assets
of the fund established pursuant to this chapter.
C.
The normal form of annuity under the plan is a life annuity. However,
upon retirement, a participant may elect to receive benefits in a
form different than the normally prescribed annuity form. Any such
alternative form must be the actuarial equivalent of the normal form
of annuity. Alternative options include, but are not limited to, the
following:
(1)
A life annuity coupled with a guaranty that payments will be made
for a certain period of years, such as five, 10 or 15 years.
(2)
A joint and contingent survivor annuity, whereby the annuity is to
continue to the participant's spouse after the death of the retired
participant as a specified percentage of the annuity being paid while
the participant survived.
(3)
Any other alternative form requested by the participant which is
approved by the employer.
The early retirement date is the first of the month coincident
with or next following a participant's retirement from the employ
of the employer which occurs within five years before the normal retirement
date. Such retirement is subject to the written consent of the Committee
and to the requirement that the participant have 10 years of service.
The early retirement benefit is the actuarial equivalent of
the accrued benefit earned to the early retirement date.
A.
A participant is disabled when he is wholly disabled by bodily injury
or disease so as to be unable to engage in any occupation or employment
for wage or profit and such disability is expected to be permanent
and continuous during the remainder of his life, but excluding a disability
resulting from military service, for which a government pension is
payable, and excluding a disability resulting from habitual drunkenness
or addiction to narcotics, engaging in a criminal enterprise or intentionally
self-inflicted injury.
B.
The determination of whether or not a participant is or continues
to be disabled will be made by the Committee on the basis of such
medical evidence and other relevant data as the Committee deems necessary
or desirable. Failure of a participant to furnish such evidence or
data when requested shall be sufficient reason for the Committee to
determine that the participant is not disabled or no longer disabled.
C.
A participant will not cease to be disabled solely because he engages
in gainful employment for purposes of rehabilitation, as approved
by the Committee.
E.
If a participant becomes disabled after meeting the eligibility requirements
and remains disabled for six consecutive months, he will become eligible
to receive disability benefits as of the first day of each month thereafter
as long as he is living and remains disabled.
F.
The amount of disability benefits to be received by a participant
will be equal to 100% of the accrued benefit determined as if termination
of employment had occurred on the date that the participant became
disabled. The amount of disability benefits will be reduced by the
amount of any periodic cash payments provided for the participant
under or on account of any workmen's compensation law or similar
law which became payable on or after the date he first became eligible
for disability benefits hereunder.
G.
If a participant has become eligible for disability benefits under the provisions of Subsection E above but thereafter improves to the point that he is able to perform some type or types of employment for compensation but still remains unfit, either physically, mentally, emotionally or by lack of training or experience, to perform any type of work for the Borough of Boyertown, the Committee shall have the discretion to award unto the participant such part-time disability benefits as it deems proper, taking into consideration the amounts the participant is able to earn in other employment.
There are no death benefits under this plan except for any death
benefits that may be payable based upon the annuity option elected
for someone in benefit receipt status.
[Amended 7-1-1996 by Ord.
No. 2-96]
A.
A participant's vesting percentage is 100% upon attainment of
normal retirement date or upon being disabled. Upon early retirement
or termination of employment, the vesting percentage is as follows:
|
Participant's Years of Service
|
Percentage
| ||
|---|---|---|---|
|
Less than 3
|
0
| ||
|
3
|
20
| ||
|
4
|
40
| ||
|
5
|
60
| ||
|
6
|
80
| ||
|
7
|
100
|
A.
The benefit payments herein provided for shall not be subject to
attachment, execution, levy, garnishment or other legal process and
shall be payable only to the participant or the designated beneficiary.
B.
No participant or his beneficiary shall have any right to alienate,
encumber or assign any assets of the fund on his behalf or any of
the benefits or proceeds of any contract or agreement purchased or
acquired hereunder.
C.
Any contract or agreement purchased or acquired pursuant to this
chapter upon the life of such participant shall contain a provision,
in substance, that to the extent permitted by law, none of the benefits
or payments or proceeds of such contract or agreement shall be subject
to any legal process by any creditor of such participant or beneficiary
of such participant.
[Adopted 3-4-2002 by Ord.
No. 1-02]
As used in this article, the following terms shall have the
meanings indicated:
The Internal Revenue Code, as amended periodically.
Plan member's wages, as defined in Code Section 3401(a),
for a plan year for which the municipality is required to provide
the plan member a written statement under Code Sections 6041(d), 6051(a)(3)
and 6052. Such 415 compensation shall include any elective deferrals
defined in Code Section 402(g)(3) and all amounts contributed or deferred
at the election of the plan members which are not includible in the
gross income of the plan member by reason of either Code Sections
125, 402(e)(3), 402(h)(1)(B), 403(b), 414(h)(2) or 457.
The political subdivision named at the top of this page.[1]
The pension plan specified at the top of this page.[2]
The calendar year.
The income tax regulations, as amended periodically.
A.
Unless the plan member otherwise elects, the payment of benefits
under the plan to the plan member will begin not later than the 60th
day after the latest of the close of the plan year in which:
B.
In the case of a plan which provides for the payment of an early
retirement benefit, a plan member who satisfied the service requirements
for such early retirement benefit, but separated from the service
(with any nonforfeitable right to an accrued benefit) before satisfying
the age requirement for such early retirement benefit, is entitled
upon satisfaction of such age requirement to receive a benefit not
less than the benefit to which he would be entitled at the normal
retirement age, actuarially reduced under regulations prescribed by
the Secretary.
C.
A plan member's benefits must commence to be paid not later
than April 1st of the calendar year following the later of the calendar
year in which the member attains age 70 1/2 or the calendar year
in which the member retires. Such distributions must equal or exceed
the required minimum distribution, and otherwise be made in a manner
consistent with the requirements of Code Section 401(a)(9) and the
regulations thereunder.
D.
Required distributions must be made over the lifetime or the life
expectancy of the plan member or the joint life times or joint life
expectancy of the plan member and the plan member's designated
beneficiary. The life expectancy of the plan member and the plan member's
spouse may be redetermined at the election of the plan member or the
plan member's spouse. Such an election is irrevocable, once made.
If no such election is made by the date benefit distributions must
commence, then the life expectancy of the plan member and the plan
member's spouse shall not be recalculated. Tables V and VI of
Regulation 1.72-9 shall be used for computing life expectancy or joint
and survivor life expectancy.
E.
All benefit distributions to a plan member or the plan member's
beneficiary shall be in accordance with the incidental death benefit
requirements of Code Section 401(a)(9)(G) and the related regulations.
The limitations and other requirements outlined below are intended
to comply with Code Section 415 and the regulations thereunder, the
terms of which are specifically incorporated herein by reference.
The maximum compensation limit and benefits limitations under the
Code are as follows:
A.
The compensation used in calculating a plan member's benefit
cannot exceed the limits of Code Section 401(a)(17), as adjusted for
cost-of-living increases, per Code Section 415(d).
B.
General rule. In no event shall the annual retirement benefit payable
to a plan member under this plan, together with retirement benefits
provided under all qualified benefit plans maintained or previously
maintained by the municipality, for any limitation year, which shall
be the calendar year, exceed the maximum benefit permitted, as adjusted
annually per Code Section 415(d), under Code Section 415(b) (including
any applicable grandfathering rules). This plan section shall be applied
in accordance with Code Section 415 and the regulations thereunder.
C.
Adjustments of limits.
(1)
Where a retirement benefit commences before age 62, the Code Section
415(b)(1)(A) dollar limit shall be reduced in accordance with Code
Section 415(b)(2)(F). This reduction shall not result in a limit that
is less than $75,000 if the benefit begins at or after age 55, or
the actuarial equivalent of $75,000 at age 55 (determined in accordance
with Code Section 415) if the benefit begins before age 55.
(2)
Where a retirement benefit commences after age 65, the Code Section
415(b)(1)(A) dollar limit shall be increased as described in Code
Section 415(b)(2)(F).
(3)
The maximum benefit limit of Code Section 415(b)(1) shall be applied
to benefits in the form of a straight life annuity (with no ancillary
benefits) without regard to benefits attributed to plan member contributions
and rollover contributions. If the form payable to a plan member is
other than a single life annuity or a Code Section 417(b) qualified
joint and survivor annuity, the plan member's benefit shall not
exceed the actuarial equivalent of the Code Section 415(b)(1) maximum
payable in the form of a single life annuity unless no such adjustment
is required under Code Section 415 and related regulations.
(4)
Notwithstanding the other rules of the plan and Code Section 415,
if the plan member has not participated in a defined contribution
plan of the municipality, the plan member's annual retirement
benefit shall not be deemed to exceed the maximum benefit limit if
it does not exceed the Code Section 415(b)(4) limit of $10,000, as
adjusted for plan participation or service of less than 10 years in
accordance with Code Section 415(b)(5).
D.
Order of defined benefit plan reductions. If the plan member participates
or participated in any other defined benefit plan of the municipality,
and the plan member's aggregate annual retirement benefit under
this plan and such other plan exceeds the limits permitted under Code
Section 415, such plan member's benefit shall be first reduced
under this plan.
A.
Notwithstanding the plan's vesting schedule, upon any amendment
or restatement of the plan, a plan member's vested accrued benefit
shall not be less than the vested accrued benefit immediately preceding
such amendment or restatement.
B.
Notwithstanding the plan's vesting schedule, a plan member shall
be 100% vested when the plan member completes the age and service
requirements for normal retirement at his normal retirement date under
the plan.
C.
Notwithstanding the plan's vesting schedule, a plan member shall
be 100% vested in his accrued benefit (to the extent funded) as of
the date of partial or complete plan termination.
Notwithstanding § 42-16, the plan shall recognize any qualified domestic relations order (QDRO) set forth under Code Section 414(p). Any plan member's benefits, rights or elections shall be subject to any rights afforded to the alternate payee by a QDRO. Further, a distribution to an alternate payee is permitted if authorized by a QDRO, even if the plan member involved has not separated from service and has not reached the earliest retirement age under the plan.
No plan member or beneficiary shall have any benefit subject to any type of alienation, anticipation, assignment, charge, encumbrance, pledge, sale or transfer. Further, no benefits shall be subject to or liable for any debts, contracts, engagements, liabilities or torts. The only exceptions to this section are those in § 42-17, above and those referenced in Code Sections 401(a)(13)(C) and (D).
If any portion of a plan benefit is payable to a plan member
or beneficiary at the later of the plan member's 62nd birthday
or his normal retirement age and such benefit remains unpaid solely
by reason that the municipality, after sending a registered letter,
to the last known address, return receipt requested, and after diligent
effort fails to locate the plan member or beneficiary, the actuarial
value of the benefit shall be forfeited and applied towards reducing
plan costs. If, subsequent to the forfeiture, a plan member or beneficiary
is located, the actuarial value of the forfeiture at the time it was
forfeited (no adjustments for gains or losses) shall be restored.
Forfeitures must not be applied to increase the benefits any
municipal employee would otherwise receive under the plan.
In the case of any merger or consolidation with, or transfer
of plan assets or liabilities to any other plan, each plan member
would (if the plan then terminated) receive a benefit immediately
after the merger, consolidation, or transfer which is equal to or
greater than the benefit he would have been entitled to receive immediately
before the merger, consolidation, or transfer (if the plan had then
terminated).
As required by Code Section 401(a)(25), the actuarial assumptions
used to calculate plan benefits shall not be subject to the municipality's
discretion.
A.
Distribution shall be made in the form of a direct trustee-to-trustee
transfer to the eligible retirement plan so specified if any distributee
of any eligible rollover distribution:
C.
Eligible rollover distribution. For purposes of this subsection,
the term "eligible rollover distribution" has the meaning given such
term by Code Section 402(f)(2)(A).
D.
Eligible retirement plan. For purposes of this subsection, the term
"eligible retirement plan" has the meaning given such term by Code
Section 402(c)(8)(B), except that a qualified trust shall be considered
an eligible retirement plan only if it is a defined contribution plan,
the terms of which permit the acceptance of rollover distributions.
