1100 GEN/OUA PensionORDINANCE NO. ]inn
AN ORDINANCE OF THE CITY OF OKEECHOBEE
AMENDING THE CITY OF OKEECHOBEE AND
OKEECHOBEE UTILITY AUTHORITY EMPLOYEES'
RETIREMENT SYSTEM, ADOPTED PURSUANT TO
ORDINANCE NO. 1053, AS SUBSEQUENTLY AMENDED;
AMENDING SECTION 1, DEFINITIONS; AMENDING
SECTION 14, MAXIMUM PENSION; PROVIDING FOR
CODIFICATION; PROVIDING FOR SEVERABILITY OF
PROVISIONS; REPEALING ALL ORDINANCES IN
CONFLICT HEREWITH AND PROVIDING AN EFFECTIVE
DATE.
WHEREAS, the City of Okeechobee and the Okeechobee Utility Authority
employees are presently provided pension and certain other benefits under Ordinances
of the City of Okeechobee; and
WHEREAS, it becomes necessary from time to time to amend said ordinances in
order to clarify or restate certain provisions of the ordinance, or to enact amendments to
comply with revised Federal regulations;
NOW THEREFORE, be it ordained before the City Council of the City of
Okeechobee, Florida; presented at a duly advertised public meeting; and passed by
majority vote of the City Council; and properly executed by the Mayor or designee, as Chief
Presiding Officer for the City:
SECTION 1: That the City of Okeechobee and Okeechobee Utility Authority
Employees' Retirement System, adopted pursuant to Ordinance No. 1053, as
subsequently amended, is hereby further amended by amending Section 1, Definitions, to
amend the definition of "Credited Service ", to read as follows:
Credited Service means the total number of years and fractional parts of years of
service as a General Employee with member contributions when required, omitting
intervening years or fractional parts of years when such Member was not employed by the
City as a General Employee. A Member may voluntarily leave his Accumulated Contribu-
tions in the Fund for a period of five (5) years after leaving the employ of the City pending
the possibility of being reemployed as a General Employee, without losing credit for the
time that he was a Member of the System. If a non - vested Member leaves the employ of
the City and is not reemployed within five (5) years, his Accumulated Contributions, if one -
thousand dollars ($1,000.00) or less, will be returned. If a Member who is not vested is not
reemployed within five (5) years, his Accumulated Contributions, if more than one -
thousand dollars ($1,000.00), will be returned only upon the written request of the Member
and upon completion of a written election to receive a cash lump sum or to rollover the
lump sum amount on forms designated by the Board. If a vested Member leaves the
employ of the City, his Accumulated Contributions will be returned upon his written request.
Upon return of his Accumulated Contributions, all of his rights and benefits under the
System are forfeited and terminated.
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 General Employee with the City to
perform training or service, shall be added to his years of Credited Service for all purposes,
including vesting, provided that:
A. The Member is entitled to reemployment under the provisions of
USERRA.
B. The Member returns to his employment as a General Employee within
one (1) year from the earlier of the date of his military discharge or his
release from service, unless otherwise required by USERRA.
C. The Member deposits into the Fund the same sum that the Member
would have contributed if he had remained a General Employee
during his absence. The maximum credit for military service pursuant
to this subsection shall be five (5) years. The Member must deposit
all missed contributions within a period equal to three (3) times the
period of military service, but not more than five (5) years following
reemployment or he will forfeit the right to receive Credited Service for
his military service pursuant to this Section.
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D. This Section is intended to satisfy the minimum requirements of
USERRA. To the extent that this Section 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.
Beginning January 1, 2009, to the extent required by Section 414(u)(12) of the
Code, an individual receiving differential wage payments (as defined under Section
3401(h)(2) of the Code) from an employer shall be treated as employed by that employer,
and the differential wage payment shall be treated as compensation for purposes of
applying the limits on annual additions under Section 415(c) of the Code. This provision
shall be applied to all similarly situated individuals in a reasonably equivalent manner.
SECTION 2: That the City of Okeechobee and Okeechobee Utility Authority
Employees' Retirement System, adopted pursuant to Ordinance No. 1053, as
subsequently amended, is hereby further amended by amending Section 14, Maximum
Pension, to read as follows:
SECTION 14. 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.
For purposes of Code Section 415(b), the "annual benefit" means a benefit
payable annually in the form of a straight life annuity (with no ancillary benefits) without
regard to the benefit attributable to after -tax employee contributions (except pursuant to
Code Section 415(n) and to rollover contributions (as defined in Code Section
415(b)(2)(A)). The "benefit attributable" shall be determined in accordance with Treasury
Regulations.
2. Adjustments to Basic Limitation for Form of Benefit.
If the benefit under the plan is other than the
annual benefit described in subsection 1., then the benefit shall be adjusted so that it is the
equivalent of the annual benefit, using factors prescribed in Treasury Regulations. If the
form of the benefit without regard to any automatic benefit increase feature is not a straight
life annuity or a qualified joint and survivor annuity, then the preceding sentence is applied
by either reducing the Code Section 415(b) limit applicable at the annuity starting date or
adjusting the form of benefit to an actuarially equivalent amount (determined using the
assumptions specified in Treasury Regulation Section 1.415(b)- 1(c)(2)(ii)) that takes into
account the additional benefits under the form of benefit as follows:
A. For a benefit paid in a form to which Section 417(e)(3) of the Code
does not apply (generally, a monthly benefit), the actuarially
equivalent straight life annuity benefit that is the greater of:
The annual amount of the straight life annuity (if any) payable
to the Member under the Plan commencing at the same
annuity starting date as the form of benefit to the Member, or
The annual amount of the straight life annuity commencing at
the same annuity starting date that has the same actuarial
present value as the form of benefit payable to the Member,
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computed using a five percent (5 %) interest assumption (or
the applicable statutory interest assumption) and (i) for years
prior to January 1, 2009, the applicable mortality tables
described in Treasury Regulation Section 1.417(e)- 1(d)(2)
(Revenue Ruling 2001 -62 or any subsequent Revenue Ruling
modifying the applicable provisions of Revenue Rulings 2001-
62), and (ii) for years after December 31, 2008, the applicable
mortality tables described in Section 417(e)(3)(B) of the Code
(Notice 2008 -85 or any subsequent Internal Revenue Service
guidance implementing Section 417(e)(3)(B) of the Code); or
B. For a benefit paid in a form to which Section 417(e)(3) of the Code
applies (generally, a lump sum benefit), the actuarially equivalent
straight life annuity benefit that is the greatest of:
a) The annual amount of the straight life annuity commencing at
the annuity starting date that has the same actuarial present
value as the particular form of benefit payable, computed using
the interest rate and mortality table, or tabular factor, specified
in the Plan for actuarial experience:
The annual amount of the straight life annuity commencing at
the annuity starting date that has the same actuarial present
value as the particular form of benefit payable, computed using
a five and one half percent (5.5 %) interest assumption (or the
applicable statutory interest assumption) and (i) for years prior
to January 1, 2009, the applicable mortality tables for the
distribution under Treasury Regulation Section 1.417(e)- 1(d)(2)
(the mortality table specified in Revenue Ruling 2001 -62 or any
subsequent Revenue Ruling modifying the applicable
provisions of Revenue Ruling 2001 -62), and (ii) for years after
December 31, 2008, the applicable mortality tables described
in Section 417(e)(3)(B) of the Code (Notice 2008 -85 or any
subsequent Internal Revenue Service guidance implementing
section 417(e)(3)(B) of the Code); or
a) The annual amount of the straight life annuity commencing at
the annuity starting date that has the same actuarial present
value as the particular form of benefit payable (computed using
the applicable interest rate for the distribution under Treasury
Regulation Section 1.417(e)- 1(d)(3) (the 30 -year Treasury rate
(prior to January 1, 2007, using the rate in effect for the month
prior to retirement, and on and after January 1, 2007, using the
rate in effect for the first day of the Plan Year with a one -year
stabilization period)) and (i) for years prior to January 1, 2009,
the applicable mortality tables for the distribution under
Treasury Regulation Section 1.417(e)- 1(d)(2) (the mortality
table specified in Revenue Ruling 2001 -62 or any subsequent
Revenue Ruling modifying the applicable provisions of
Revenue Ruling 2001 -62), and (ii) for years after December
31, 2008, the applicable mortality tables described in Section
417(e)(3)(B) of the Code (Notice 2008 -85 or any subsequent
Internal Revenue Service guidance implementing Section
417(e)(3)(B) of the Code), divided by 1.05.
C. The actuary may adjust the 415(b) limit at the annuity starting date in
accordance with subsections A. and B above.
3. 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 thereunder to be taken into account for purposes of the
limitation of Code Section 415(b)(1): and
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C. That portion of any joint and survivor annuity that constitutes a
qualified joint and survivor annuity.
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 limitation year of benefit
payments without regard to any automatic cost of living adjustments;
B. thereafter, in any subsequent calendar limitation 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 thereunder; but
C. in no event shall a Member's benefit payable under the System in any
ealenetaf limitation 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 thereunder.
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 police or fire
department of the City, the adjustments provided for in A. above shall
not apply.
C. The reductions provided for in A. above shall not be applicable to
disability benefits pursuant to Section 8, or pre- retirement death
benefits paid pursuant to Section 7.
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 Participation or Service.
The maximum retirement benefits payable under this Section to any Member
who has completed Tess 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% of the limit determined without regard to this subsection.
The reduction provided for in this subsection shall not be applicable to pre- retirement
disability benefits paid pursuant to Section 8, or pre- retirement death benefits paid
pursuant to Section 7.
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7. 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; Less Than Ten Years of Service.
Notwithstanding tip -fo1g anything in this Section 14, the retirement
benefit payable with respect to a Member shall be deemed not to exceed the limit set forth
in this subsection 8. of Section 14 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
limitation year and for any prior Plan Year limitation year and the City has not any time
maintained a qualified defined contribution plan in which the Member participatedi
provided, however, that if the Member has completed less than ten (10) years of Credited
Service with the City, the limit under this subsection 8. of Section 14 shall be a reduced
limit equal to ten thousand dollars ($10,000) 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).
9. 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, as allowed in Section 23 and 27, 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 (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 (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
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(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 B.(2), may include service credited in order to provide an
increased benefit for service credit which a Member is receiving under
the System.
11. Contribution Limits.
E A. For purposes of applying the Code Section 415(c) limits its -this
which are incorporated by reference and for purposes
of this subsection 11., only and for no other purpose, the definition of
compensation where applicable will be compensation actually paid or
made available during a calendar limitation 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 limitation 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), or457(b). For ealendarlimitation 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 limitation year will also include
compensation paid by the later of 21/2 months after an
employee's severance from employment or the end of the
mar limitation year that includes the date of the
employee's severance from employment if:
(3)
(a) 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
(b) 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.
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.
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O B. 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 (1) 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.
C. If the annual additions for any Member for a limitation year exceed the
limitation under Section 415(c) of the Code, the excess annual
addition will be corrected as permitted under the Employee Plans
Compliance Resolution System (or similar IRS correction program).
D. For limitation years beginning on or after January 1, 2009, a
Member's compensation for purposes of this subsection 11. shall not
exceed the annual limit under Section 401(a)(17) of the Code.
+1- 12. 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 Compensa-
tion. 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, U.S. Code.
SECTION 3: Specific authority is hereby granted to codify and incorporate this
Ordinance in the existing Code of Ordinances of the City of Okeechobee.
SECTION 4: All Ordinances or parts of Ordinances in conflict herewith be and the
same are hereby repealed.
SECTION 5: If any section, subsection, sentence, clause, phrase of this ordinance,
or the particular application thereof shall be held invalid by any court, administrative
agency, or other body with appropriate jurisdiction, the remaining section, subsection,
sentences, clauses, or phrases under application shall not be affected thereby.
SECTION 6: That this Ordinance shall become effective upon adoption.
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Introduced on first reading and set for public hearing this 16th day of
July , 2013.
ATTEST:
f
Lane Gamiote City Clerk
fa.rries E. Kirk, Mayor
Passed on second reading after public hearing this 20th day of
q „gust , 2013.
ATTEST:
Lane Gamiote , City Clerk
APPROVED FOR LEGAL SUFFICIENCY:
d m/o k/g a n/0 5- 28 -13. o rd
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James E. Kirk, Mayor