[Ord. 173, 6/11/1952, Paragraph 1]
It is the considered opinion of this body that the extension
of the Social Security System to employees and officers of the Borough
of Mifflinburg will be of great benefit, not only to the employees
of the Borough by providing that said employees and officers may participate
in the provisions of the Old Age and Survivors Insurance System, but
will also be of great benefit to the Borough of Mifflinburg by enabling
it to attract and retain in employment the best of personnel and thus
increase the efficiency of its government.[1]
[1]
Editor's Note: At the end of this ordinance was a provision
for the repeal of all inconsistent ordinances and parts of ordinances.
[Ord. 173, 6/11/1952, Paragraph 2]
The 1951 Session of the General Assembly of the Commonwealth
of Pennsylvania, in regular session, enacted a statute, known as Act
No. 491, which is the enabling Act provided for in Section 218 of
Public Law 734, 81st Congress, which designated the Secretary of Labor
and Industry of the Commonwealth of Pennsylvania to act as the "State
Agency" to implement the coverage of employees and officers under
the said Old Age and Survivors Insurance System. The Borough of Mifflinburg
is hereby authorized to execute and deliver to the State Agency a
plan, or plans, and agreement, required under Section 6 of said enabling
Act and the Social Security Act, to extend coverage to employees and
officers under the Old Age and Survivors Insurance System.
[Ord. 173, 6/11/1952, Paragraph 3]
The Clerk is hereby authorized to establish a system of payroll
deduction to be matched by payments by the Borough of Mifflinburg
to be made into the Contribution Fund of the Social Security Act through
the office of the State Agency, and to make charges of this tax to
the funds, or funds, from which wage or salary payments are issued
to employees of the Borough of Mifflinburg. Such payments are to be
made in accordance with the provisions of the law and regulations
promulgated by the State Agency and the Federal Security Administrator.
Such payments which are delinquent shall bear interest at the rate
of 1/2 of 1% per month until such time as payments are made.
[Ord. 173, 6/11/1952, Paragraph 4]
Appropriation is hereby made from the proper fund, or funds,
of the Borough of Mifflinburg in the necessary amount to pay into
the Contribution Fund as provided in Section 4 of the enabling Act
and in accordance with the plan, or plans, and agreement. Authority
is given to the Mayor and Clerk of the Borough of Mifflinburg to enter
into an agreement with the State Agency, which agreement shall be
in accordance with Act No. 491 and with paragraph 218 of the Social
Security Act. Such plan and agreement shall provide that the participation
of this Borough of Mifflinburg shall commence as of January 1, 1952.
[Res. 1985-2, 4/16/1985]
Any employee of the Borough of Mifflinburg shall receive his/her
full day's wages during any days in which that employee has been
summoned as a member of a jury panel for any judicial proceeding in
the Pennsylvania State Court System, or the United States Federal
Court System. In consideration of these continued wage payments, the
employee must reimburse the Borough with that sum of money which he/she
received as compensation as a juror.
[Ord. 96-04, 12/17/1996, § 1]
Any non-uniformed employee of the Borough may, with the consent of the Borough, irrevocably elect to reduce and defer compensation as specified in § 1-712 and as acknowledged through the joinder agreement, a copy of which is made a part of this subpart.
[Ord. 96-04, 12/17/1996, § 1]
The employee's compensation which would otherwise be receivable
during the period of employment subsequent to the effective date of
the joinder agreement shall be irrevocably reduced and that the portion
of the compensation reduced shall be deferred as specified in this
subpart.
With regard to the amount which an employee defers in any calendar
year it is agreed:
B.
An eligible employee may utilize a limited "catch up" provision for one or more of the last three taxable years of an employee's immediately preceding normal retirement age specified in § 1-721, the maximum amount of which can be deferred in any taxable year through utilization of both the defined contribution limits and the "catch-up" provision is the lesser of
D.
In the event an employee's annual deferral exceeds the limits described in § 1-713, any benefits payable under § 1-713E below and attributable to such excess deferral shall be paid only if the following conditions are satisfied:
(1)
The employee must continue his relationship with the Borough until the normal retirement age specified in § 1-721 unless the relationship is terminated because of the total disability or death of the employee; and,
(2)
While retirement benefits are being paid to the employee, the employee
shall remain available to provide consulting services to the Borough
at such times and in such manner as the Borough may request and the
employee shall refrain from rendering services, assistance or advice
to any enterprise which competes with the Borough. Determination by
the Borough Council that the employee has failed to satisfy the condition
set forth above shall be binding on all parties, and on anyone else
having an interest in benefits due.
E.
An eligible person, with respect to participation commencing in the
initial year of the plan, or an individual when he or she first becomes
eligible to participate, may become an employee within 60 days after
the plan becomes effective or the employee first becomes eligible,
by agreeing to defer compensation for the following calendar year,
but such agreement must be made at least 30 days prior to the beginning
of the calendar year in which it is to become effective. For the initial
year of the plan, the employee may make his or her election any time
up to January 1, 1997.
F.
An employee shall have the right exercisable at least 30 days prior
to the beginning of any calendar year to elect to increase or decrease
the compensation reduction for the ensuring calendar year by executing
another joinder agreement. For the initial year of the plan, the employee
may make his or her election any time up to January 1, 1997.
G.
For purposes of this subpart, an employee's failure to file written notice of his or her elective choice as provided in § 1-713E, above, shall constitute a waiver by the employee of his or her right to elect a different reduction sum for the next succeeding calendar year and an affirmation and ratification to continue the stated compensation reduction as chosen for the prior period.
H.
An employee may elect to discontinue compensation reductions for
any subsequent calendar year following the effective date of his or
her joinder agreement provided that the employee shall notify the
Borough of such discontinuance at least 30 days prior to the subsequent
calendar year.
Amounts deferred by an employee shall be accrued in the following
manner:
A.
A deferred compensation account shall be established for each employee
on the Borough's books. The deferred compensation account shall
be credited on the first day of each pay period with an amount equal
to the amount that the employee has notified the Borough in a joinder
agreement that he wishes to have deferred.
B.
Any amounts credited to the deferred compensation account may be
accumulated at a fixed rate of interest or the Borough may invest
all or a portion of the amounts deferred in mutual funds, stocks,
bonds, securities, life insurance or any other assets as is selected
by the employee.
C.
The employee understands and agrees on behalf of himself and his
designated beneficiary to assume all risk in connection with any decrease
in value of the funds which are invested or which continue to be invested
in accordance with the provisions of this subpart.
D.
Title to and beneficial ownership of any assets, whether cash or
investments which the Borough may earmark to pay the deferred compensation
benefits due under this subpart, shall at all times remain the sole
property of the Borough subject to the claims of the Borough's
general creditors and the employee and his designated beneficiary
shall not have any property interest whatsoever in any specific assets
of the Borough.
[Ord. 96-04, 12/17/1996, § 1; as amended by Ord.
2005-8, 11/15/2005, § 1]
The benefits to be paid as deferred compensation are as follows:
A.
If the employee's employment continues until his normal retirement as specified in § 1-721, the Borough shall pay to him in 180 monthly installments, commencing on the first day of the month next following the date of the employee's retirement, an amount equal to the fair market value of the assets, if any, in the deferred compensation account plus the accumulated amount credited to the deferred compensation account in lieu of actual investments. The monthly amount payable to the employee shall be appropriately increased or decreased as the case may be, but not more frequently than annually, to reflect the appreciation or depreciation in value of and the net income or loss realized on the amounts which remain invested in the deferred compensation account. In adjusting the amount of the monthly payments, the Borough shall take into account future gains or losses on amounts invested which can reasonably be anticipated. If the employee should die after he retires and begins receiving payments, but before the last payment has been made, the remaining payments shall continue to be paid in installments for the unexpired portion of the one-hundred-eighty-month period to his designated beneficiary in the same manner as set forth in herein.
B.
If the employee's employment is terminated for any reason other than death before he retires on the date specified in § 1-721, then the amount in the deferred compensation account shall continue to be invested or accrued at interest as the Borough in its discretion may determine and no payments shall be made until the employee reaches his normal retirement age, at which time payments shall be made in the same manner and to the same extent as set forth in § 1-715A. Notwithstanding the foregoing, if the employee should die prior to reaching his normal retirement age, then payments shall be made in the same manner and to the same extent as set forth in § 1-715C.
C.
If the employee's employment is terminated because of death before he has reached his normal retirement age as specified in § 1-721, then the Borough shall make 180 monthly payments, commencing on the first day of the month next following the date of the employee's death, to the employee's designated beneficiary in the same manner and to the same extent as provided in § 1-715A.
D.
If both the employee and his designated beneficiary should die before
a total of 180 monthly payments are made by the Borough, then the
remaining value of the deferred compensation account shall be determined
as of the date of the death of the designated beneficiary or, if the
designated beneficiary predeceases the employee or if they die in
a common disaster, as of the date of death of the employee, the value
of the deferred compensation account shall be paid in a lump sum to
the estate of the designated beneficiary or, if the designated beneficiary
predeceases the employee or if they die in a common disaster, to the
estate of the employee.
E.
The employee shall designate in the joinder agreement a beneficiary to receive any payments due under this subpart upon the death of the employee. The employee may change the beneficiary at any time by written notice to the Borough. If the employee fails to designate a beneficiary, any payments dues upon the death of the employee shall be paid to the employee's estate as provided in § 1-715D.
F.
Notwithstanding anything contained in this subpart to the contrary,
the Borough shall have the right, in its sole discretion, to vary
the manner and time of making the installment distributions provided
in this subsection and may make such distributions in lump sums or
over a shorter or longer period than specified in this subsection
as it may find appropriate.
G.
Notwithstanding anything contained in this subpart to the contrary,
any benefits to which an employee is entitled shall commence not later
than the April 1 following the calendar year in which the employee
attains age 70 1/2, whether or not his employment had terminated
in such year. Such distributions shall be at least equal to the required
minimum distributions under the Internal Revenue Code, however, any
installment period shall not exceed 10 years.
H.
An employee may request a withdrawal under this subpart prior to
retirement or termination of employment in the event he or she is
faced with an unforeseeable emergency. Withdrawals must be limited
to amount necessary to meet the emergency for which the employee has
not been reimbursed by insurance or otherwise. The withdrawal shall
be effective upon approval by the Borough and shall be paid in a lump
sum to the employee. The deferred compensation account of the employee
shall be reduced by the amount of the withdrawal.
I.
If the employee's employment continues to normal retirement age as defined in § 1-721 as modified in this Part, the employee shall also have the option of payment of the employee's deferred compensation account in a tax-free rollover to another retirement account of that employee consistent with all relevant Internal Revenue Service, or other government agency, rules and regulations.
[Ord. 96-04, 12/17/1996, § 1]
Nothing contained in the joinder agreement and no action taken
pursuant to the provisions of this subpart shall create or be construed
to create a trust of any kind, or a fiduciary relationship between
the Borough and the employee, his designated beneficiary or any other
person. Any funds which may be invested under the provisions of this
subpart shall continue, for all purposes, to be a part of the general
funds of the Borough and no person other than the Borough shall, by
virtue of the provisions of this subpart, have any interest in such
funds. To the extent that any person acquires a right to receive payments
from the Borough under this subpart, such right shall be no greater
than the right of any unsecured general creditor of the Borough.
[Ord. 96-04, 12/17/1996, § 1]
Neither the employee nor his designated beneficiary nor any
other person entitled to payments under this subpart shall have the
power to transfer, assign, anticipate, mortgage or otherwise encumber
in advance any of such payments, nor shall such payments be subject
to seizure for the payment of public or private debts, judgments,
alimony, or separate maintenance, or be transferable by operation
of law in event of bankruptcy, insolvency or otherwise.
[Ord. 96-04, 12/17/1996, § 1]
Nothing contained in this subpart shall be construed as conferring
upon the employee the right to continue in the employment of the Borough.
[Ord. 96-04, 12/17/1996, § 1]
The Borough reserves the right to amend any provision of this
subpart at any time to the extent that it may deem advisable without
the consent of any employee or any beneficiary.
[Ord. 96-04, 12/17/1996, § 1]
The Agreement shall be binding upon the parties hereto, their
heirs, executors, administrators, successors and assigns. The Borough
agrees that it will not be a party to any merger, consolidation or
reorganization, unless and until its obligations under this subpart
shall be expressly assumed by its successor or successors.
[Ord. 96-04, 12/17/1996, § 1; as amended by Ord.
2005-8, 11/15/2005, § 2]
The following definitions shall be effective for terms used
in this subpart:
All earnings for services performed by the employee for the
Borough including, but not limited to, the gross salary of the employee.
The amount of the employee's compensation for purposes of this
subpart shall be the amount he or she is entitled to receive before
deduction for Federal or State income, F.I.C.A. or F.U.T.A. taxes
or pension plan contributions.
That amount deferred which results from the employee's
election to reduce his or her compensation under the joinder agreement
and which the employee and Borough mutually agree shall be deferred
in accordance with this agreement.
Retirement from service with the Borough which becomes effective
on the first day of the first month after the employee attains age
of 59 1/2.
A severe financial hardship to the employee resulting from
a sudden and unexpected illness or accident of the employee or of
a dependent of the employee, loss of the employee's property
due to casualty, or similar extraordinary and unforeseeable circumstance
arising as a result of events beyond the control of the employee.
[Ord. 96-04, 12/17/1996, § 1]
This subpart shall be construed under the law of the State of
Pennsylvania and Section 457 of the Internal Revenue Code of 1986,
as amended.
[Ord. 96-04, 12/17/1996]
1.
Claim. A person who believes that he is being denied a benefit to
which he is entitled under the plan (hereinafter referred to as "claimant")
may file a written request for such benefit with the employer, setting
forth his claim. The request must be addressed to the Mifflinburg
Borough Secretary at the Borough's then principal place of business.
2.
Claim Decision. Upon receipt of a claim, the employer shall advise
the claimant that a reply will be forthcoming within 90 days and shall,
in fact, deliver such reply within such period. The employer may,
however, extend the reply period for an additional 90 days for reasonable
cause. If the claim is denied in whole or in part, the employer shall
adopt a written opinion, using language calculated to be understood
by the claimant, setting forth:
A.
The specific reason or reasons for such denial.
B.
The specific reference to pertinent provisions of this subpart on
which such denial is based.
C.
A description of any additional material or information necessary
for the claimant to perfect his claim and an explanation why such
material or such information is necessary.
D.
Appropriate information as to the steps to be taken if the claimant
wishes to submit the claim for review.
3.
Request for Review. Within 60 days after receipt by claimant of the
written opinion described above, the claimant may request in writing
that the named fiduciary review the determination of the employer.
Such request must be addressed to the named fiduciary, at its then
principal place of business. The claimant or his duly authorized representative
may, but need not, review the pertinent documents and submit issues
and comments in writing for consideration by the employer. If the
claimant does not request a review of the employer's determination
by the named fiduciary within such sixty-day period, he shall be barred
and stopped from challenging the employer's determination.
4.
Review of Decision. Within 60 days after the named fiduciary's
receipt of a request for review, he will review the employer's
determination. After considering all material presented by the claimant,
the fiduciary will render a written opinion, written in a manner calculated
to be understood by the claimant, setting forth the specific reasons
for the decision and containing specific references to the pertinent
provisions of this Part on which the decision is based. If special
circumstances require that the sixty-day time period be extended,
the fiduciary will so notify the claimant and will render the decision
as soon as possible, but no later than 120 days after receipt of the
request for review.
[Added by Ord. 2016-01, 2/16/2016]
1.
Freezing of Eligibility to Participate. Effective December 20, 2015,
no newly hired nonuniformed Borough employees are eligible to participate
in the deferred compensation plan established under this Subpart B.
The deferred compensation plan under this Subpart is effectively frozen
December 20, 2015.
2.
Freezing of Compensation Deferrals. Effective December 20, 2015,
no additional compensation deferrals shall be made by any nonuniformed
Borough employee, and any elections to defer compensation under this
Subpart B shall be terminated and of no effect.
3.
All Other Provisions Remain Intact. Notwithstanding the provisions of Subsections 1 and 2 above, any nonuniformed Borough employee who contributed to the deferred compensation plan and who has an accrued account under § 1-714 (Accrual of Accounts) shall be eligible for a distribution of his or her account in the ordinary course and in accordance with the provisions of § 1-715 (Payment Procedure).
[Added by Ord. 2016-03, 4/1/2016]
A.
Termination of the Plan. Effective April 19, 2016, the deferred compensation
plan under this Subpart B, which was effectively frozen December 20,
2015, shall be terminated in its entirety effective as of April 19,
2016.
B.
Liquidation of the Plan. Effective as of April 19, 2016, the Borough
shall undertake any and all necessary action to distribute to all
current participants in the deferred compensation plan any and all
amounts accrued under their accounts. Each participant shall be permitted
to elect to receive all or a portion of his or her account balance
in a lump-sum payment or directly roll all or a portion of his or
her account balance into an "eligible retirement plan" (including
an individual retirement account or "IRA"), as defined in Section
402(c)(8)(B) of the Internal Revenue Code of 1986, as amended. The
Borough is permitted to establish an IRA in the name of any participant
who fails to make a timely election under this Subsection 2, and shall
directly transfer that participant's account balance to the IRA
established in his or her name.
C.
All Other Provisions Remain Intact. Notwithstanding the provisions of Subsections ` and 2 above, until such time as the deferred compensation plan is liquidated in its entirety, any nonuniformed Borough employee who contributed to the deferred compensation plan and who has an accrued account under § 1-714 (Accrual of Accounts) shall be eligible for a distribution of his or her account in the ordinary course and in accordance with the provisions of § 1-715 (Payment Procedure). After the complete liquidation of the deferred compensation plan, Ordinance 96-04 shall no longer be in effect.
