HomeMy WebLinkAbout1999 Ordinance No. 046'\ .
• , . c '"
•
•
•
ORDINANCE NO.~
SERIES OF 1999
BY AUTHORITY
COUNCIL BILL NO. 48
INTRODUCED BY COUNCIL
MEMBER WAGGONER
AN ORDINANCE AUTHORIZING THE ADOPTION OF AN AMENDED CITY OF
ENGLEWOOD FIREFIGHTERS' PENSION PLAN DOCUMENT, WHICH PROVIDES
A DEFERRED RETIREMENT OPTION PLAN (DROP) BENEFIT FOR THE
PARTICIPANTS OF THIS PLAN.
WHEREAS , this proposed Ordinance allows the adoption of an amended
Englewood Firefighters' Pension Plan to comply with State Statutes, Federal
guidelines and to provide a Deferred Retirement Option Plan (DROP) benefit for the
participants of this Plan; and
WHEREAS , this proposed Ordinance provides plan participants with the option of
participating in a Deferred Retirement Option Plan (DROP); and
WHEREAS, this proposed Ordinance does not substantially change the current
level of pension benefits for the "old hire" firefighters; and
WHEREAS, the amended Plan mirrors the current benefits as defined in Colorado
State Statutes, Federal guidelines and provides a Deferred Retirement Option Plan
(DROP) benefit for the participants of the plan;
NOW , THEREFORE , BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
ENGLEWOOD , COLORADO , AS FOLLOWS :
Section 1. The City Council of the City of Englewood, Colorado hereby authorizes
the adoption of an amended "City of Englewood Firefighters Pension Plan -as
amended and restated effective January 1, 1999," attached hereto as "Exhibit A," and
said Plan is hereby accepted and approved by the Englewood City Council.
Section 2. The Mayor is authorized to execute and the City Clerk to attest and seal
the "City of Englewood Firefighters Pension Plan -as amended and restated effective
January 1, 1999," for and on behalf of the City of Englewood, Colorado.
Introduced, read in full, and passed on first reading on the i6th day of August,
1999 .
-1-
10 bi
Published as a Bill for an Ordinance on the 20th day of August, 1999.
Read by title and passed on final reading on the 7th day of September, 1999.
Published by title as Ordinance No.~ Series of 1999, on the 10th day of
September, 1999.
I, Loucrishia A. Ellis, City Clerk of the City of Englewood, Colorado, hereby certify
that the above and foregoing is a true COP¥J9f the Ordinance pas on final reading
and published by title as Ordinance No. 112, Series of 1999.
-2-
' r
/
r '. /t ,·, .
•
•
•
•
•
•
02-29144.07
CITY OF ENGLEWOOD
FIREFIGHTERS PENSION PLAN
(AS AMENDED AND RESTATED JANUARY L 1999)
E x
H
I
B
I
T
A
PREAMBLE
ARTICLE I
ARTICLE II
ARTICLE ill
ARTICLE IV
ARTICLE V
ARTICLE VI
02-29144.07
City of Englewood
Firefighters Pension Plan ,•
(As Amended and Restated January I. 1999)
TABLE OF CONTENTS
Page No.
Purpose and Definitions .......................................................................... 1-1
Section 1. Purpose ............................................................................... 1-1
Section 2 . Definitions .......................................................................... 1-1
Section 3 . Construction ........................................................................ 1-4
Service Credit ........................................................................................ II-I
Section I. Service ............................................................................... II-I
Section 2 . Break in Service ................................................................. II-I
Section 3 . Military Service ................................................................. II-I
Section 4 . Fractional Years ................................................................. II-1
Participation Requirements ................................................................... ill-1
Section 1. Participation Originating Under the Previous Plan ............ ill-I
Section 2 . Cessation of Participation and Reentry ............................. ill-1
Section 3 . Effect of Disability or Death Benefits Payable From
Another Plan .................................................................... ill-I
Contributions ....................................................................................... IV-I
Section 1. Contributions by Employer and the State of Colorado ...... IV-1
Section 2 . Contributions by Participants ........................................... IV-1
Section 3 . Participant Contributions Picked Up by Employer ............ IV-1
Pension Benefits ..................................................................................... V-1
Section 1.
Section 2 .
Section 3.
Section 4 .
Section 5 .
Section 6 .
Section 7 .
·Section 8.
Normal Pension Commencement ....................................... V-I
Normal Pension Amount .................................................... V-1
Deferred Vested Pension Commencement.. ........................ V-2
Deferred Vested Pension Amount ...................................... V-2
No Decrease in Benefits· ..................................................... V-3
Increases in Benefits .......................................................... V-3
Required Distribution ofRetirement Benefits ..................... V-3
Deferred Retirement Option Plan (DROP) ......................... V-3
Form of Payment. ................................................................................. VI-1
Section 1. Normal Form of Pension -Single Life .............................. VI-1
Section 2 . Optional Forms ofBenefit ................................................ VI-1
Section 3 . Qualified Joint and Survivor Benefit Option ..................... VI-1
Section 4 . One Hundred Percent Joint and Survivor Benefit
Option .............................................................................. VI-2
Section 5. Fifty Percent Joint and Survivor Benefit Option ............... VI-2
Section 6 . Five Year Certain and Life Benefit Options ...................... VI-2
Section 7 . Beneficiary ....................................................................... VI-3
(i)
•
•
•
• ARTICLE VII Death Benefits ..................................................................................... VII-I
Section I . Death Benefit for Surviving Spouse or Dependent
Parent ............................................................................. VII-I
Section 2. Death Benefit for Dependent Children ............................ VII-I
Section 3 . Death Benefit after Eligibility for a Deferred Vested
VII-Pension ..................................................................... VII-1
Section 4. Proof ofDeath ................................................................. VII-2
Section 5. Additional Death Benefit.. ............................................... VII-2
ARTICLE VIlI Contribution Accumulation Refunds .................................................. VllI-1
Section 1. Contribution Accumulation Refund to Participant .......... VllI-1
ARTICLE IX Administration by Board of Trustees .................................................... IX-1
Section 1. Establishment and General Duties .................................... IX-1
Section 2 . Members .......................................................................... IX-I
Section 3 . Terms ............................................................................... IX-I
Section 4. Meetings .......................................................................... IX-I
Section 5. Quorum. ........................................................................... IX-2
Section 6 . Majority Vote .................................................................. IX-2
Section 7. Compensation .................................................................. IX-2
Section 8 . Rules and Regulations ...................................................... IX-2
Section 9 . Powers ............................................................................. IX-2
Section 10 . Decisions ......................................................................... IX-3 • ARTICLEX
Section 11. Report of Board ............................................................... IX-3
Trust Fund ............................................................... ~ .......................... X-I
Section 1. Establishment of Trust Fund .............................................. X-1
Section 2 . Payment of Contributions to Trust Fund ............................. X-I
ARTICLE XI Special Governmental Requirements .................................................... XI-I
Section 1. Maximum Annual Benefit Under Code Section 415 ......... XI-I
ARTICLE XII Guarantees and Liabilities ................................................................... XII-I
Section I . Nonguarantee ofEmployment ......................................... XII-I
Section 2 . Rights to Trust Assets ..................................................... XII-I
Section 3 . Nonalienation of Benefits ................................................ XII-1
ARTICLE XIII Amendments ...................................................................................... XIII-1
Section I . Right to Amend .............................................................. XIII-1
ARTICLE XIV Withdrawal and Termination ............................................................. XIV-I
Section 1. Plan Termination ........................................................... XIV-I
Section 2 . Allocation of Assets Upon Plan Termination ................. XIV-1
Section 3 . Manner of Distribution .................................................. XIV-I
Section 4. Amounts Returnable to the Employer ............................ XIV-I
Section 5. Applicable Law ............................................................. XIV-2
ARTICLE XV Direct Ro II overs .................................................................................. XV-1 • Section I . General ........................................................................... XV-1
Section 2 . Definitions ...................................................................... XV-1
02-29144.07 (ii)
•
•
•
City of Englewood
Firefighters Pension Plan
(As Amended and Restated January 1. 1999)
PREAMBLE
WHEREAS, the Employer had previously established a pension plan under State statutes
for its firefighters (hereinafter referred to as the "Previous Plan"); and
WHEREAS, said organization now desires to amend and continue the Previous Plan by a
separate restatement in its entirety and the right to so amend is reserved to said organization
under the provisions of the Previous Plan;
NOW, THEREFORE, the Previous P lan, which was maintained by the Employer under
Title 31, Article 30, Part 4 of the Colorado Revised Statutes, is hereby restated, and amended in
its entirety, superseded and replaced by this separate restated Plan.
There will be no termination and no gap or lapse in time or effect between such Plans,
and the existence of the Plan shall be continuous and uninterrupted.
This restated Pension Plan is conditioned upon its qualification under Section 40l(a) of
the Internal Revenue Code of 1986 , as amended from time to time.
The terms and conditions of this restated Plan are as follows :
02·29144.07
ARTICLE I
Purpose and Definitions
=S=ect=io=n.:.....:..1.,___P=-u=rp~o~s~e: The purpose of this Plan is to provide retirement and incidental
benefits for all Employees (as hereinafter defined), their surviving spouses, dependent children
and dependent parents, who complete a period of faithful service and otherwise become eligible
hereunder . The benefits provided by this Plan will be paid from a Trust Fund established in
connection with this Plan.
This Plan and the separate related Pension Trust forming a part hereof are established and
shall be maintained for the exclusive benefit of the eligible Employees and their Beneficiaries .
Except as hereinafter provided, no part of the Trust Fund can ever revert to the Employer, or be
used for or diverted to purposes other than the exclusive benefit of the Employees and their
Beneficiaries.
=S=ec=t=io=n=-2=.,__----'D=-=:ce=fi=n=it=io""'"n=-'s: Where the following words and phrases appear in this Plan,
they shall have the respective meanings set forth below, unless their context clearly indicates to
the contrary:
a . Accrued Pension : The Pension determined under the Plan expressed in
the form of a monthly benefit commencing at Normal Retirement Date (or date of actual
retirement if later), which an Employee has accrued at any time under the provisions of
the Plan, regardless of his vested status, determined as if he had then terminated
employment.
b . Actuarial (or Actuarially) Equivalent: Equality in value of the aggregate
amounts expected to be received under different manners of payment based on interest
rate and mortality assumptions, in effect on the date as of which the benefit is to
commence, as such assumptions are defined below unless otherwise specifically provided
in the Plan.
02-29144.07
Interest rate assumption -The interest rate assumption used for purposes of
computing optional forms of benefit payments shall be seven and one-half percent
(7 1/2%).
I-1
•
•
•
•
•
Mortality assumption -
(1) Effective July 1, 1999, the mortality assumption used for purposes
of computing optional forms of benefit payments shall be a unisex rate that is
50% male, 50% female, taken from the 1983 Group Annuity Mortality Table.
Prior to July 1, 1999 such mortality assumption shall be the UP-1984 Mortality
Table.
(2) Solely for purposes of Article XI hereof, on and after January 1,
1995, the mortality assumption for calculation shall be a unisex rate that is fifty
percent (50%) male, fifty percent (50%) female, taken from the 1983 Group
Annuity Mortality Table.
c. Board : The Board of Trustees established under Article IX hereof
d . Code or Internal Rev~nue Code : The Internal Revenue Code of 1986, 26
USC (1986), as amended from time to time.
e. Compensation : All base pay received by the Participant for his Covered
Employment, including, longevity pay, holiday pay, sick pay, vacation pay taken in the
normal course of employment, shift differential, but Compensation shall exclude
compensation for overtime (or compensation in lieu of overtime required under the Fair
Labor Standards Act, except Compensation shall include compensation only for t~ose
premium hours required to be paid, based on the current seventy-two (72) hour, nine-day
reoccurring work cycle), clothing allowance, lump-sum amounts paid in lieu of
accumulated vacation, holidays and sick leave, acting pay, and compensation imputed as
a result of the Participant's use of the Employer's automobile . A Participant's
Compensation shall include any amounts deferred as to such Participant Code Section
125, Code Section 457 or under Code Section 414(h), except to the extent such amounts
would be excluded under the immediately preceding sentence. Compensation taken into
account under the Plan shall not exceed $200,000, adjusted for changes in the
cost-of-living as provided in Code Section 415( d), for the purpose of calculating a
Participant's Accrued Pension (including the right to any optional benefit provided under
the Plan) for any Plan Year commencing after December 31, 1988 .
In addition to other applicable limitations set forth in the Plan, and
notwithstanding any other provision of the Plan to the contrary, for Plan Years beginning
on or after January 1, 1996, the annual compensation of each ''Noneligible Participant"
taken into account under the Plan shall not exceed the Omnibus Budget Reconciliation
Act of 1993 ("OBRA '93") annual compensation limit. The OBRA '93 annual
compensation limit is $150,000, as adjusted by the Commissioner for increases in the
cost ofliving in accordance with Code Section 401 ( a)(l 7)(B ). The cost-of-living
adjustment in effect for a calendar year applies to any period, not exceeding 12 months,
over which compensation is determined (determination period) beginning in such
calendar year. If a determination period consists of fewer than 12 months, the OBRA '93
annual compensation limit will be multiplied by a fraction, the numerator of which is the
number of months in the determination period, and th e denominator of which is 12 . A
02-29144.07 I-2
''Noneligible Participant" is any Participant who first became a Participant in the Plan
during a Plan Year beginning on or after January 1, 1996.
Effective January 1, 1989, through December 31, 1996, in determining the
Compensation of a Participant for purposes of this limitation, the rules of Code Section
414(q)(6) shall apply, except in applying such rules, the term 'family' shall include only
the spouse of the Participant and any lineal descendants of the Participant who have not
attained age 19 before the close of the year, effective January 1, 1989 through
December 31, 1996, if, as a result of the application of such rules the adjusted annual
Compensation limitation is exceeded then the limitation shall be prorated among the
affected individuals in proportion to each such individual's Compensation as determined
under this Section prior to the application of this limitation.
f Contribution Accumulation: The Participant's aggregate contributions,
plus five percent (5%) simple interest on the total amount.
g. Covered Employment : The employment category for which the Plan is
maintained, which is full-time, salaried employment with the Employer as a paid member
of the Employer's Fire Division, serving at least one thousand six hundred (1,600) hours
in any calendar year, and which includes all firefighters within the Fire Division hired
prior to April 8, 1978 . Excluded are leased employees within the meaning of Code
Section 4 l 4(n)(2).
h. Disabilitv or Disabled : A physical or mental condition which, in the
judgment of the board of the Fire and Police Pension Association, totally and presumably
permanently prevents an Employee from performing the duties of any occupation for
which the firefighter, by reason of his education, training and experience, would be
capable of performing, but for the injury or illness involved. In determining whether any
firefighter is so permanently disabled, any disability, and any known injury or illness,
which pre-existed the firefighter's employment with the City of Englewood, shall be
disregarded .
1. Effective Date: January 1, 1999 .
j Employee : Any person whose Covered Employment with the Employer
commenced prior to April 8, 1978, and who , on and after the Effective Date, is receiving
remuneration for Covered Employment or would be receiving such remuneration except
for a duly authorized absence. Included are leased employees within the meaning of
Code Section 414(n)(2). Notwithstanding the foregoing, if such leased employees
constitute less than twenty percent (20%) of the Employer's nonhighly compensated
work force within the meaning of Code Section 414(n)(5)(C)(ii), the term "Employee"
shall not include those leased employees covered by a plan described in Code Section
414(n)(5).
k. Employer : City of Englewood, Colorado .
', '
I. Final Monthly Compensation : The Compensation earned by a Participant •
during his last full month of Covered Employment; except Final Monthly Compensation
02-29144.07 1-3
•
•
•
cannot be less than the average monthly compensation earned by the Participant during
the last twelve (12) full months of Covered Employment.
m. Limitation Year: The year used in applying the limitations of Code
Section 415, which year shall be the calendar year.
Notwithstanding the Effective Date hereof, such limitations, as set forth in
Article XI, Section 1. hereof, apply beginning with the first Limitation Year beginning
after 1982 .
n . Normal Retirement Date: The date when a Participant has attained his
fiftieth ( 50th) birthday and has completed twenty (20) years of Service.
o . Participant: An Employee who meets the eligibility requirements for
participation in the Plan as described in Article ID hereof
p . Pension : A series of monthly amounts which are payable to a person who
is entitled to receive benefits under the Plan.
q . Plan : City of Englewood Firefighters Pension Plan (As Amended and
Restated January 1, 1999), as amended from time to time .
r . Plan Year: The twelve (12) month period beginning on January 1 and
ending on December 31 .
s . Previous Plan: Firemen 's Pension Plan of the City of Englewood or City
of Englewood Firemen's Pension Plan, in force and effect (under Title 31, Article 30 .5
(and prior to May 23, 1996, under Title 31 , Article 30, Part 4) of the Colorado Revised
Statutes) for the period prior to the Effective Date, the Plan hereby being amended and
restated . Any reference herein to the Previous Plan as of a certain date or for a certain
period shall be deemed a reference to the Previous Plan as then in effect.
t. Service : A person's period or periods of employment as an Employee
.used in determining eligibility, or the amount of benefits, and described in Article II
hereof ·
u . Trust or Trust Fund : The fund maintained to provide the benefits called
for und~r this Plan, as described in Article X hereof
=S-""ec"""'t=io"-'n~3'-. ---=C~o~n~st~ru~ct~io'-n~: The masculine gender, where appearing in the Plan, shall
be deemed to include the feminine gender; the singular may include the plural ; and vice versa,
unless the context clearly indicates to the contrary .
02-29144.07 1-4
ARTICLE II
Service Credit
=S-..ect~io-.On'--'1'""". ____ S-=e~rvt~·~ce~: Service is the period of employment used in determining eligibility for
benefits . An Employee's total Service credit shall be:
a. His total period of Covered Employment with the Employer, subject, however, to
Article II, Section 3 below; and
b. Any prior period of employment, before April 9, 1978, with another fire
department which maintains a firefighters pension fund under the laws of the State of Colorado,
such prior period of employment to be credited in the same manner and to the same extent as
Service with the Employer, subject, however, to Article II, Section 3 below; and
c. Any credit called for under federal law for an absence due to military duty.
Section 2. Break in Service : An Employee shall have a Break in Service if his Covered
Employment with the Employer is terminated. An Employee's authorized leave of absence, or a leave
•
due to disability as defined at Article I, Section 2h, shall not result in a Break in Service; however, the •
Employee will not receive any Service credit during such an absence.
Effective as of August 5, 1993 , a leave of absence pursuant to the Family and Medical Leave
Act of 1993 shall not be considered a Break in Service; however, the Employee will not receive any
Service credit during any such absence without pay .
Section 3. Military Service : Notwithstanding any provision of the Plan to the contrary,
contributions, benefits and Service credit with respect to qualified military service will be provided in
accordance with Code Section 414(u).
Section 4 . Fractional Years : In determining Service credit, Service for fractional years shall
be allowed on the basis of one-three hundred sixty-fifth (1/365th) of one year for each full day of such
Service.
F:\DEP1\FIN_SVC\CWESCOA1\W!NWORD6\FIRE\98 Fire Plan Docwnent final_ do not change.do .
II-1
•
•
•
ARTICLE ID
Participation Requirements
Section 1. Participation Originating Under the Previous Plan: Employees in Covered
Employment who were Participants in the Previous Plan immediately prior to the Effective Date
shall automatically become Participants in this restated Plan as of the Effective Date.
Section 2. Cessation of Participat ion and Reentry: If a Participant leaves Covered
Employment, he will cease his participation in this Plan, and will not again become a Participant.
(Recommencement of Covered Employment results in coverage under a statewide pension
system under Title 31, Article 31 of the Colorado Revised Statutes (and prior to May 23, 1996,
under Title 31, Article 30, Part 10 of the Colorado Revised Statutes)).
Sectioff3 . Effect of Disability or Death Benefits Payable From Another Plan : If a
disability or death benefit is payable to or wi th respect to a Participant in accordance with
Section 31-31-803 or Section-31-31-807, Colorado Revised Statutes (and prior to May 23 , 1996,
Sections 31-30-1007 or 31-30-1008 , Colorado Revised Statutes), then no benefit shall be payable
from this Plan to or with respect to such Part icipant.
ill-1
02-29144.07
ARTICLE IV
Contributions
Section 1. Contributions by Employer and the State of Colorado: The City of
Englewood shall make contributions to the Trust Fund adequate to finance the benefits provided
by the Plan on a sound actuarial basis. The required contributions to the Plan shall be
determined by a competent actuary. The amount of contribution shall never be less than the
amount required by Colorado state statute or Fire and Police Pension Association rules and
regulations . Contributions may also be received hereunder from the State of Colorado in
accordance with applicable state law, or from any person. Contributions may be received by gift,
grant, devise or bequest, in the form of money , personal property, real estate or any interest
therein and may include all moneys, fees , rewards and emoluments , except firefighters ' salaries,
of every nature and description that may be paid or given to the Fire Division or any of its
members . Any amounts given to the Employer 's Fire Division or to an Employee in his capacity
as a firefighter, except as his salary, may be received as a contribution hereunder. All such
contributions shall be used to pay benefits under the Plan or to pay expenses of the Plan and
Trust and shall be irrevocable, except for any amounts remaining after satisfying all liabilities of
the ~Ian . Forfeitures arising because of severance of employment before the Participant becomes
eligible for a Pension or for any other reason shall be applied to reduce the costs of the Plan, not
to increase the benefits otherwise payable to the Participants.
Section 2 . Contributions by Participants : Each Plan Participant shall contribute
toward the cost of providing benefits under this Plan by payroll deductions at the rate of five
percent (5%) of the Participant's Compensation each month.
Section 3 . Participant Contributions Picked Up by Employer: Participant
contributions made on or after the effective date of the DROP under Article V, Section 8, and
02-29144.07 IV-I
•
•
•
•
•
•
solely while a Participating DROP Member, as defined in Article V, Section 8, shall be picked
up by the Employer. The contributions so picked up by the Employer shall be treated as
Participant contributions for purposes of this Plan even though such contributions are treated as
Employer contributions for income tax purposes in accordance with Code Section 414(h). For
purposes of this Section only, the Compensation (as defined in Article I, Section 2 .e) that a
Participant would otherwise receive for Covered Employment shall automatically be reduced by
an amount equal to the contributions so picked up for such Participant.
02-29144.07 N-2
:
ARTICLE V
Pension Benefits
Section I. Normal Pension Commencement: A Participant hereunder shall be
entitled to his Accrued Pension if his Covered Employment with the Employer is terminated on
or after his Normal Retirement Date.
Any Participant who desires to retire from Covered Employment and receive a Pension
from this Plan shall submit a written application to the Board, which application shall set forth
the facts entitling such Participant to a Pension hereunder. The application shall specify the
time, neither less than thirty (30) nor more than one hundred eighty (180) days subsequent to the
filing of the application, when the Participant desires to be retired . The Board shall act upon
such application if the Participant is entitled to retire , and shall notify the Employer of such
action. The action of the Board shall be completed at the next scheduled Board meeting
following the filing of the application . Payment of a Normal Pension will commence the last day
of the month coincident with or next following the Participant's actual Retirement, or as soon
thereafter as administratively practicable . If a Participant retires prior to the last day of the
month, his first payment hereunder shall include a partial payment prorated from his date of
retirement to the end of the month .
Section 2. Normal Pension Amount: A Participant who meets the requirements for
his Accrued Pension shall receive an annual pension (payable monthly) which is equal to :
Two and one-half percent (2 1/2%) of the Participant's Final Monthly Compensation
multiplied by the Participant's first twenty (20) years of Service, plus one percent (1 % ) for each
additional year of Service, to a maximum of sixty-five percent (65%) of Final Monthly
Compensation .
02-29144.07 V-1
•
•
•
•
•
•
Section 3. Deferred Vested Pension Commencement: A Participant hereunder shall
be eligible for a Deferred Vested Pension if his Covered Employment with the Employer is
terminated prior to his eligibility for a Normal Pension but after he becomes vested in a Pension
benefit under the following vesting schedule:
Vesting Schedule
A Participant's vested interest is determined, according to the Participant's years of
Service, as follows:
Participant's Years
of Service
Less than 5
5 or more
Vested Percentage of
Participant's Accrued Pension
0%
100%
Service as used in Article V, Sections 3 and 4 shall include only the Participant's period
of employment with the City of Englewood .
Payment of a Deferred Vested Pension shall commence as of the first day of the month
next following the Participant's attainment of age fifty (50) ifhe is living; however, ifthe
Participant requests a refund of his Contribution Accumulation under Article VIII, Section 1 b
hereof, he shall forfeit such Deferred Vested Pension . If a Participant retires pursuant to this
Section prior to the last day of the month, his first payment hereunder shall include a partial
payment prorated from his date of retirement to the end of the month .
Section 4 . Deferred Vested Pension Amount: A Participant who meets the
requirements for a Deferred Vested Pension shall receive a monthly amount equal to:
Two and one-half percent (2 1/2%) of his Final Monthly Compensation multiplied by his
first twenty (20) years of Service with the Employer, plus one percent (1 % ) for each
additional year of Service, to a maximum of sixty-five percent (65%) of Final Monthly
Compensation .
02-29144.07 V-2
Section 5. No Decrease in Benefits: This restated Plan shall not result in the
decrease of benefits accrued by any Participant under the Previous Plan immediately prior to the
Effective Date of this restated Plan.
Section 6. Increases in Benefits: Provided that the Trust Fund is properly funded as
provided in Article IV hereof, and upon recommendation of the Board, the City Council of the
City of Englewood may annually vote upon and approve an increase in the Accrued Pension
being paid to any Participants receiving benefits under this Plan. In the event of a flat dollar
increase in benefits, such an increase for a surviving spouse or dependent parent or payments
receiving payments pursuant to Article VII, Section 1., shall be equal to one-third (1/3) of the flat
dollar amount.
Section 7 . Required Distribution ofRetirement Benefits : Effective January I , 1992 ,
notwithstanding any provision of the Plan to the contrary, pursuant to Code Section 401 (a)(9),
payment of benefits shall commence not later than the later of April 1 of the calendar year
following the calendar year in which the Participant attains age seventy and one-half (70-1/2), or
terminates employment.
Section 8 . Deferred Ret ir ement Opti o n Plan (DROP):
a . Effective Date : Notwithstanding Article I, Section 2.i ., the provisions of
this Section 8 . shall be effective on the first day of the month which falls at least thirty
(30) days after the date of receipt of a favorable determination letter from the Internal
Revenue Service for the Plan .
=b'-. ---=T~i=tl=e: The program set forth in this Section 8 . may be referred to as the
"DROP."
c . Applicability: The provisions of this Section are applicable with respect to
those otherwise eligible Participants of the Plan whose election to participate in the
DROP occurs on or after the effective date contained in Section 8 .a., of this Article V.
An "Eligible Participant" is any Participant who has attained the Normal Retirement Date
•
•
in accordance with Article L Section 2.n. A "Participating DROP Member" is any •
Eligible Participant who has elected to participate in the DROP as provided by this
Section 8 .
02 -29144.07 V-3
•
•
•
d. Purpose: The purpose of the DROP is to allow an Eligible Participant to
elect, in lieu of immediate termination of employment and receipt of Pension, to continue
employment for a specified period of time and to have the Eligible Participant's
contribution under Article IV and Pension paid into the DROP account until the end of
such specified period of the Participating DROP Member's participation, at which time
employment is to cease. An Eligible Participant must choose a Single Life Pension or
one of the retirement options provided in Article VI at the same time the Eligible
Participant elects to participate in the DROP .
e. Participation : An Eligible Participant may participate in the DROP only
once .
An Eligible Participant may elect to participate in the DROP upon filing of
written notification with the Board not less than sixty (60) nor more than ninety (90) days
prior to the date of intended participation.
f Term : The duration of a Participating DROP Member's participation in
the DROP shall not exceed a total of five years. As a condition precedent to participation
in the DROP, the Participating DROP Member shall execute an irrevocable agreement
with the Employer in the form prescribed by the Board, which shall, among other items,
clearly and unequivocally state that the Participating DROP Member must retire no later
than the date prescribed in the agreement which may not exceed the fifth anniversary of
the Participating DROP Member's participation in the DROP, and the Participating
DROP Member shall also acknowledge that no disbursement of any DROP funds can
occur absent the retirement or death of the Participating DROP Member.
g. Interruption of Participation : If the Participating DROP Member's
participation in the DROP is interrupted by military service, there shall be no interruption
of membership in the DROP . Such a Participating DROP Member's Pension shall
continue to be paid into the Participating DROP Member's DROP account while in
military service for the balance of the five-year ma"Ximum term elected by the DROP
Member under subsection f Upon re turn to emplo y ment with the Employer, the
Participating DROP Member shall be given the opportunity to make up the Participant
contributions under Article IV that would hav e been made to his DROP account were he
not in military service in accordance with Code Section 414(u). In no event, however,
will the term of participation of a Participating DROP Member exceed the term elected
under subsection f
h. Effect on Participation in the Plan : Upon commencement of the Eligible
Participant 's participation in the DROP , a Participant's Service cred it, F inal Monthly
Compensation and his Accrued Pension shall be frozen . A Participating DROP Member
shall not share in any subsequent formula improvements . However, a Participating
DROP Member shall share in any ad hoc increase granted to retired Participants.
i. Contribution: Upon commencement of the Eligible Participant's
participation in the DROP, the Pension provided in Article V and the Participant's
contribution provided in Article IV shall be paid into the Participating DROP Member's
02-29144.07 V-4
DROP account . In no case shall the Employer contribution, provided for in Article IV,
Section 1., be used to fund the DROP. The Pension transferred or paid to a Participating •
Member's DROP account shall not constitute annual additions under Code Section 415.
j. Administration of DROP Assets: The DROP assets shall continue to be
commingled for investment purposes as part of the Plan and shall be credited with net
investment earnings and losses at the same rate as other assets in the Plan. The Board of
Directors of the Fire and Police Pension Association shall be authorized to charge each
account a fee for administration of the DROP . A DROP account shall be established for
each Participating DROP Member. Such DROP account shall be adjusted, no less
frequently than annually for contributions, distributions and net investment earnings and
losses.
k . Regulations: The Board is authorized to adopt rules and regulations
governing the DROP.
I. Fees : If the DROP account shall be subject to any fees or charges of any
kind, such fees or charges shall be charged to the Participating DROP Member 's account.
m . Form of Payment: For purposes of this Section 8., a "Retiree" is a
Participating DROP Member who terminates employment or reaches the five-year limit
for participation in the DROP . A Retiree must choose one of the following forms of
payment from the individual 's DROP account :
02-29144.07
(1) Deferred Pavment: Distribution from a DROP account may be •
deferred until a date designated by the Retiree . When designating the date upon
which distributions shall commence, the Retiree must also designate the form of
payment from one of the available options . Regardless of the date chosen by the
Retiree, all distributions must commence no later than the year in which the
Retiree attains the age of 70 Yz;
(2) Lumo Sum : A one-time distribution of the Retiree's entire account
balance, including a direct rollover under Article XV ;
(3) Periodic Payments Designating an Amount : Distribution of the
Retiree's account balance by monthly payments in an amount designated by the
Retiree, until the entire balance of the account is distributed ;
(4) Periodic Payments for a Designated Period of Time: Monthly
payments to the Retiree for a period designated by the Retiree . The payment will
be calculated such that upon the occurrence of the last monthly payment, the
entire balance of the account will be distributed ;
(5) Initial Minimum Required Distribution : Account balance is
distributed as periodic payments that are calculated based on the Retiree's life
expectancy (and the life expectancy of the Retiree's designated beneficiary if •
applicable); or
V-5
•
•
•
(6) Combination of Lump Sum and Periodic Payments: An initial
lump sum payment of an amount designated by the Retiree, followed by a
designation of a number of subsequent monthly payments or an amount payable
on a monthly basis .
Regardless of the form of payment the Retiree chooses, the minimum distribution
amount will be determined and made in accordance with Code Section 40I(a)(9) and the
regulations thereunder, including minimum distribution incidental death benefit
requirement of Proposed Regulation Section 1.401(a)(9)-2. The minimum distribution is
recalculated annually on the basis of the life expectancy of the Retiree and the Retiree's
designated beneficiary, if applicable. If elected in writing before the required beginning
date under Code Section 401(a)(9) by the Retiree , and/or the Retiree 's spouse, if
applicable, the life expectancy of the Retiree and/or the Retiree 's spouse shall be
recalculated annually .
If t he Retiree makes no selection as to form of payment within 30 days after the
termination of employment or expiration of the five-year lim it for participation in the
DROP, a lump sum pay ment shall be made .
All distributions need to follow the distribution guidelines from the F ire and
Police Pension Association .
n . Participating DROP Member 's Death; Spousal Beneficiarv : If the
Participating DROP Member dies during the per iod of the Partic ipating DROP Member's
participation in the DROP and the Participating DROP Member's designated beneficiary
is the Participating DROP Member's surviving spouse to whom the Participating DROP
Member was legally married at the time of the Participating DROP Member 's death, the
Participating DROP Member 's designated beneficiary shall recei v e, at the beneficiary's
option, a lump sum pay ment from the deceased Partic i pating DROP Member's individual
DROP account balance, or equal monthl y installment payments fr o m the deceased
Participating DROP Member's individual DROP account over a period not to exceed the
spouse 's life or life ex pe ctancy. If no se lection is made by the designated beneficiary
within 60 days after the death of the Participating DROP Member, a lump sum payment
shall be made .
o . Participating DROP Member's Death ; Non-Spousal Beneficiarv : A
married 'Participating DROP Member may designate someone other than his spouse to be
a primary beneficiary, provided spousal consent as prescribed in Art icle VI, Section 7 ., is
obtained . If the Participating DROP Member dies during the period of the Participating
DROP Member's participation in the DROP, and the Participating DROP Member's
designated beneficiary is someone other than the Participating DROP Member's
surviving spouse to whom the Participating DROP Member was legally married at the
time of the Participating DROP Member 's death, the designated beneficiary shall receive
a lump sum payment equal to the deceased Participating DROP Member's individual
DROP account balance .
02-29144.07 V-6
p . Participating DROP Member's Death : No Designated Beneficiary: If the
Participating DROP Member dies during the period of the Participating DROP Member's •
participation in the DROP, and the designated beneficiary has not survived the
Participating DROP Member, the Participating DROP Member's estate shall receive a
lump sum payment equal to the deceased Participating DROP Member's individual
DROP account balance.
q. No Impact of DROP Participation on Other Death or Disability Benefits:
DROP participation shall not affect any other death or disability benefit provided to a
Participant under federal law, state law, city ordinance, or any rights or benefits under
any applicable collective bargaining agreement.
r . Retroactivity (Back-DROP): For purposes of this Section 8.r.,
"Retroactive Participation Date" means January 1, 1999, or such later date, as would have
been on or after an Eligible Participant's retirement date, but prior to the Effective Date
of the DROP , and which was selected by the Eligible Participant t o commence
participation in the DROP .
Notwithstand ing Sect ion 8.a ., of th is Article V, an Eligible Participant who would
have qualified for the DROP on his Retroacti v e Participation Date, had the DROP been
in effect on that date, ma y elect to have his individual DROP account credited with a one-
time lump sum payment. Such one-time lump sum payment shall equal the sum of:
(1) the number of Pension payments which would have been payable •
prior to the Effective Date of the DROP , had they commenced on the Participant's
Retroactive Participation Date; plus
(2 ) the number of months of Participant contributions, which were
made prior to the Effective Date of the DROP, commencing on the Participant's
Retroactive Participation Date (Such Participant contributions shall not be
impacted by Article IV, Section 3 hereof.);
credited with interest using the actuarial interest rate assumption provided in Article I,
Section 2 .b .
Such lump sum pay ment shall be made as soon as administratively feasible after
the Effective Date of the DROP . If a Participating DROP Member elects to have the one-
time lump sum payment deposited into his DROP account, the five-year period specified
in Section 8 .f. of this Article V will begin to run, not on the date of such election, but on
the Participating DROP Member's Retroactive Participation Date.
02-29144.07 V-7
•
•
•
•
ARTICLE VI
Form of Payment
Section 1. Normal Form of Pension -Single Life: Unless otherwise elected under
this Article VI, any Pension accrued under Article V hereof will be paid as a Single Life Pension.
Under this form of Pension, monthly payments are made to the Participant during the remaining
life of the Participant.
Section 2. Optional Forms ofBenefit: Effective January 1, 1998, subject to such
uniform rules and regulations as the Board may prescribe, and the restrictions contained in this
Article VI, a Participant may, in lieu of the Normal Form of Pension above, elect one of the
following forms of benefit which shall be the Actuarial Equivalent of the Normal Form of
Pension to which he would otherwise be entitled. The Participant must make any election of an
Optional Form of Benefit in writing, and such election must be filed with the Board at least thirty
(30) days prior to the due date of the first payment of benefits under the Plan. The election of an
option may be changed at any time prior to thirty (30) days preceding the due date of the first
payment of benefits under the Plan . However, an optional form of payment may not be elected
unless the value of the payments expected to be paid to the Participant exceeds fifty percent
(50%) o.f the value of the total benefits to be paid under such optional form .
Section 3 . Qualified Joint and Survivor Benefit Option : The Qualified Joint and
Survivor Benefit option provides an adjusted monthly benefit payment during the Participant's
life; and the spouse (to whom the Participant was married when his benefit commenced), if
surviving at the Participant's death, shall receive thereafter for life a monthly benefit of fifty
percent (50%) of the adjusted monthly amount paid to the Participant.
Within a reasonable time before the Participant's benefit commencement date hereunder,
the Board shall provide to the Participant a written explanation of the terms and conditions of the
02-29144.07 VI-1
.·
Qualified Joint and Survivor Benefit set forth herein and the effect of refusing it. If the
Employee wishes to elect a form of payment other than the Qualified Joint and Survivor Benefit,
such election will not become effective unless his spouse (if he has a spouse who can be located)
consents in writing to such election, acknowledges the effect of such election and has such
consent and acknowledgment witnessed by a Plan representative or a notary public. A properly
completed benefit election form (furnished by the Board) must be returned to the Board within
thirty (30) days prior to the Participant's benefit commencement date . If the Participant files
another election form after the earlier form and prior to his benefit commencement date, the
earlier form shall be annulled .
Section 4 . One Hundred Percent Joint and Survivor Benefit Option : The one hundred
percent (100%) Joint and Survivor Benefit option provides reduced monthly benefit payments
during the Participant's life, and upon his death after retirement, continues payments in the same
reduced amount to a designated Beneficiary during the life of such Beneficiary .
Section 5. Fifty Percent Joint and Survivor Benefit Option : The fifty percent (50%)
Joint and Survivor Benefit option provides reduced monthly benefit payments during the
Participant 's life, and, upon his death after retirement, continues payment in an amount equal to
fifty percent ( 50%) of the amount of such reduced payments to a designated Beneficiary during
the life of such Beneficiary.
Section 6 . Five Year Certain and Life Benefit Options: The five (5) Year Certain and
Life Benefit option provides adjusted monthly benefit payments during the Participant's life, and
upon his death after retirement within the sixty (60) month period, payments shall be continued
to the designated Beneficiary for the balance of the sixty (60) month period .
02-29144.07 VI-2
•
•
•
•
•
•
=S=ect=io=n=-7~.---=B:;..;e=n=e=fi=c=iary=....-: Effective January I. 1998, the Participant must designate his
Beneficiary in writing. If a married Participant wishes to designate someone other than his
spouse to be a primary Beneficiary, such designation will not become (or continue to be)
effective unless his spouse (if his spouse can be located) consents, in writing. to such designation
(or form of benefits) which may not be changed without spousal consent (or the consent of the
spouse expressly permits designations by the Participant without any requirement of further
consent by the spouse), acknowledges the effect of such designation and has such consent and
acknowledgment witnessed by a Plan representative or a notary public. Such designation shall
be made in writing upon a form provided by the Board and shall be filed with the Board. The
last such designation filed with the Board shall control.
02-29144.07 VI-3
Section I .
ARTICLE VIl
Death Benefits
Death Benefit for Surviving Spouse or Dependent Parent: If a retired
Participant who is receiving a Pension benefit hereunder shall die, leaving a surviving spouse or
dependent parent or parents, such surviving spouse or dependent parent or parents shall be
awarded a monthly annuity equal to the greater of (a) one-third (1/3) of the monthly salary of a
first-grade firefighter at the time of his death or retirement or (b) fifty percent (50%) of the
monthly amount being received by the Participant at his death, so long as the surviving spouse or
dependent parent remains unmarried . If such payment is to be made to two dependent parents, it
shall be divided equally between them . No dissolution of a subsequent marriage shall have the
effect of reinstating said spouse or dependent parent on the Pension roll or authorizing the
granting of a Pension. A Pension shall be paid to the surviving parent or parents of a deceased
retired Participant only if there is no surviving spouse or children .
Section 2 . Death Benefit for Dependent Children : The Board shall direct a Death
Benefit be paid to the surviving spouse or parent, or the legally appointed guardian, of each
dependent child of a deceased retired Participant who was , at the time of his death, receiving a
Pension benefit hereunder. Such Death ~enefit shall be a monthly annuity equal to thirty dollars
($30) per month for each dependent child, to continue until such child reaches the age of
eighteen (18) years or dies, if earlier.
Section 3 . Death Benefit after Eligibility for a Deferred Vested Pension : If any
Participant should die after he is eligible for a Deferred Vested Pension hereunder but before
Pension benefits have commenced, his spouse, if living, or his estate, if no spouse or if his
spouse is not living, shall be entitled to receive the Participant's Contribution Accumulation in a
single sum . In lieu of this single sum, a surviving spouse may elect the monthly death benefit set
VII-1
02-29144.07
•
•
•
• forth in Section 1 of this Article VII to begin on the last day of the month following the date the
Participant would have attained age fifty (50).
Section 4. Proof of Death: For the purpose of this Plan, the production of a certified
copy of the death certificate applicable to the deceased shall be sufficient evidence of death, and
the Board shall be fully protected in relying thereon. In the absence of such proof, the Board
may rely upon such other evidence of death, as it deems necessary or advisable.
Section 5. Additional Death Benefit : The Board shall direct an Additional Death
Benefit of one hundred dollars ($100) be paid to the surviving spouse or family of the deceased
active or retired Participant, or such other person as the Board shall designate.
Effective July 1, 1999, such Additional Death Benefit shall be increased to five hundred
dollars ($500) .
•
•
VII-2
02-29144.07
:
ARTICLE VIII
Contribution Accumulation Refunds
Section 1. Contribution Accumulation Refund to Participant:
a. Prior to Eligibility for Pension Benefits: If any Participant's employment
with the Employer is terminated before he qualifies for a benefit under the provisions of
Article V hereof, he shall be entitled to receive his Contribution Accumulation in the
form of a single sum payment; however, in order to receive such single sum payment, he
must apply in writing.
b . After Eligibility for Deferred Vested Pension Benefits: If any Participant's
employment with the Employer is terminated entitling him to a Deferred Vested Pension
hereunder, he may elect in writing to receive his Contribution Accumulation payable in a
single sum at any time prior to the commencement of his retirement benefit; provided,
however, that such election shall not be effective unless his spouse (if he has a spouse
who can be located) consents in writing to such election, acknowledges the effect of such
election and has such consent and acknowledgment witnessed by a Plan representative or
a notary public. If a Participant does not elect to receive such payment, it shall remain in
the Plan and he shall receive his regular Deferred Vested Pension in accordance with the
provisions hereof
•
In the event the Participant elects to take his Contribution Accumulation as set •
forth above, his Deferred Vested Pension otherwise payable hereunder shall be forfeited .
c . Forfeiture on Death : If benefits are payable from the Fire and Police
Pension Association upon the Participant's death, then the Participant shall forfeit his
Contribution Accumulation.
d . Forfeiture on Disabilitv : If benefits are payable from the Fire and Police
Pension Association upon the Participant's Disability under Section 31-31-803 , Colorado
Revised Statutes (and prior to May 23 , 1996, under Section 31-30-1007, Colorado
Revised Statutes), then the Participant shall forfeit his Contribution Accumulation.
VIII-1
02-29144.07
•
• ARTICLE IX
Administration by Board of Trustees
Section 1. Establishment and General Duties: There is hereby created a Board of
Trustees ("Board") who shall manage, use, and disburse the Trust Fund in conformity with its
rules, bylaws and this Plan. The Board shall take all necessary steps and pursue all necessary
remedies for the preservation of the Trust Fund .
~S~ect~io~n~2~.-~M_e~m_b~e_r~s: The Board shall consist of (a) the Mayor of the Employer, (b)
the Director of Financial Services of the Employer, who shall be treasurer of the Trust Fund, (c)
one citizen Member appointed by the City Council, and (d) three (3) Members who are paid or
volunteer (active or retired) firefighters but not more than one volunteer firefighter . Such
Participant members shall be elected by a majority vote of the Participants hereunder. The
• President and Secretary shall be elected by the Board .
=S-=-ec=t=io=n=-=3'--'-.---=T=-=e=rm=s: The Board shall serve terms of office as follows : the Mayor for
tenure in office; the Director of Financial Services for tenure in office ; the City Council
appointed citizen Member for a three (3) year term of office; the three (3) Members who are
active, retired or deferred vested Participants for a three (3) year term of office ; and the term of
office for the President shall be for one (1) year . Initial election of the Participants shall be
conducted to elect one (1) Member for three (3) years , one (1) Member for two (2) years and one
(I) Member for one ( 1) year, and their tenure of office shall run from January 1 to December 31
of each year. The Board shall arrange for elections of such Board members and shall establish
the rules and procedures to be followed in such elections .
Section 4 . Meetings: The Board shall hold a minimum of four ( 4) general meetings
each year. Special meetings of the Board shall be held at any time at the call of the President or
any three members of the Board.
02-29144.07 IX-I
. -
=S-=-ect=io=n"""5"""". _ __..O ..... u=o~ru~m~: A majority of the members of the Board shall constitute a
quorum.
Section 6. Majority Vote: All actions taken by the Board shall be by a vote of a
majority of those present at such meetings, except that no member of the Board shall vote on any
matter which pertains solely to himself or to his rights or benefits under the Plan.
Section 7. Compensation: No member of the Board shall receive compensation for
his service on the Board but a member may be reimbursed for reasonable expenses incurred in
connection with his duties as a member of the Board.
Section 8. Rules and Regulations : Subject to the limitations of the provisions of this
Plan, the Board shall from time to time establish rules and regulations for the performance of its
functions and the administration of this Plan.
=S-=-ec"-"t"""io~n'-'9'""'".---=P-=o'-'-w'-'e~r=s: The Board shall have all powers necessary to supervise the
administration of this Plan and the Trust Fund and to control its operation in accordance with its
terms , including, but not by way oflimitation, the following:
a. To make , amend, interpret, and enforce all appropriate rules and
regulations for the administration of the Plan and to decide or resolve any and all
questions, including interpretations of the Plan, as may arise in connection with the Plan ;
b. To determine the amounts and time of payment of benefits and the rights
of Participants and Beneficiaries to Plan benefits; to take any actions necessary to assure
timely payment of benefits to any Participant or Beneficiary eligible to receive benefits
under the Plan; and to assure a full and fair review for any Participant who is denied a
claim to any benefit under the Plan;
c. To determine all considerations affecting the eligibility of any Employee
to be or who becomes a Participant of the Plan ;
d. To determine the Service credit of any Participant and to compute the
amount of any sum payable under the Plan to any person;
e. To authorize and direct all disbursements under the Plan;
02-29144.07 IX-2
•
•
•
•
•
f. To employ any person or organization to obtain such clerical, medical,
legal and actuarial services as it may deem necessary or appropriate in carrying out the
provisions of this Plan;
g. To make or arrange for valuations and appraisals of the assets held under
this Plan and with the advice of an actuary, to detei"mine the liabilities of the Plan;
h. To create reserves for such assets for any purpose;
i. With the advice of an actuary, from time to time to adopt for the purposes
of this Plan, such mortality and other tables as it may deem necessary or appropriate for
the operation of the Plan ;
j. To authorize the Chairman of the Board to sign all legal documents and
reports on behalf of the Board ;
k To hold the assets of the Plan in a Trust account entitled "Firefighters
Pension Fund for the City of Englewood," and invest and rein vest the same and to make
such withdrawals therefrom as may be authorized by this Plan for the payment of benefits
and expenses of the Board and t he Members thereof: The Board ma y select a Corporate
Trustee, Custodian or In vestment Adv isor to assist in the management of the Trust Fund.
1. To maintain such records and accounts and to render such financial
statements and reports as may be required from time to time .
Section 10 . Decisions : Any decisions of the Board and any action taken by it with
respect to this Plan, shall be conclus ive and binding upon any and all Participants, retired
Participants, their beneficiaries, heirs , distributees , executors, administrators , and assigns, and
upon all other persons whatsoever. All dec isions made by the Board shall be made in a
nondiscriminatory manner.
Section 11 . Report of Board : The Board shall make an annual report to the Employer
on the condition of the Trust Fund .
02-29144.07 IX-3
Section 1.
ARTICLEX
Trust Fund
Establishment of Trust Fund : A Trust Fund has been established for the
purpose of receiving contributions and paying benefits under this Plan. The Board shall
administer the Trust Fund in accordance with the terms of this Plan. The Board, in its discretion,
may, with City Council approval , appoint a Trustee, insurance company or investment manager
to invest all or a portion of the funds .
Section 2 . Pavment of Contributions to Trust Fund : All contributions under this Plan
shall be paid to the Trust Fund to be held , in vested and reinvested there in . All property and
funds of the Trust Fund, including income from investments and from all other sources, shall be
retained for the exclusive benefit of Employees, as provided in the Plan, and shall be used to pay
benefits to Employees or their beneficiaries, or to pay expenses of administration of the Plan and
Trust Fund to the extent not paid by the Employer, except as provided in Article XIV, Section 4
hereof Effective January 1, 19 9 9, the Plan be came affiliated with the F ire and Police Pension
Associat ion in accordance with Colorado Revised Statutes Sections 31-30 .5-211 and 31-31-701.
02-29144.07 X-1
•
•
•
•
•
•
ARTICLE XI
Special Governmental Requirements
Section 1. Maximum Annual Benefit Under Code Section 415 : Notwithstanding any
other provision contained herein to the contrary, the benefits payable to a Participant from this
Plan, shall be subject to the limitations of Code Section 415 in accordance with subparagraphs a.,
b ., c. and d. below:
apply :
02-29144.07
a. Definitions: For purposes of this Section the following definitions shall
(1) "Annual Add ition " shall mean the sum of the following additions
to a Participant's individual account for the Limitation Year:
. (a) Emplo y er contributions (including salary reduction
contributions);
(b) His own (after-tax) contributions, if any ;
(c) Forfeitures, if any.
Annual Additions to other Employer defined contribution plans (also
taken into account when appl yi ng the limitations described below) include any
voluntary employee contributions to an account in a qualified defined benefit plan
and any employer contribution to an individual retirement account or annuity
under Code Section 408 or to a medical account for a key employee under Code
Section 40l(h) or 419A(d), except that the 25%-of-pay limit below shall not apply
to employer contributions to a ke y employee 's medical account after his
separation from service.
(2) "Earnings" for any Limitation Year shall be the Employee's earned
income, wages, salaries and fees for professional services, and other amounts
received for personal services actually rendered in the course of employment with
the Employer (including, but not limited to, commissions paid salesmen,
compensation for services on the basis of a percentage of profits, commissions on
insurance premiums, tips and bonuses), provided such amounts are actually paid
or includible in gross income during such year. Earnings shall exclude the
following:
(a) Employer contributions to a plan of deferred compensation
which are not included in the Employee's gross income for the taxable
year in which contributed or Employer contributions under a simplified
employee pension plan to the extent such contributions are deductible by
XI-1
the Employee or any distributions from a funded plan of deferred
compensation;
(b) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the Employee either
becomes freely transferable or is no longer subject to a substantial risk of
forfeiture;
( c) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock option; and
( d) Other amounts which received special tax benefits, or
contributions made by the Employer (whether or not under a salary
reduction agreement) towards the purchase of an annuity described in
Section 403(b) of the Code (whether or not the amounts are actually
excludable from the gross income of the Employee).
Notwithstanding the preceding sentence, Earnings for a Participant who is permanently
and totally disabled (as defined in Code Section 22(e)(3)) is the compensation such Participant
would have received for the Limitation Year if the Participant had been paid at the rate of
compensation paid immediately before becoming permanently and totally disabled ; for
Limitation Years beginning before January 1, 1997, but not for Limitation Years beginning after
December 31, 1997, such imputed compensation for the disabled Participant may be taken into
account only if the Participant is not a highly compensated employee (as defined in Code
Section 414( q)) and contributions made on behalf of such Participant are nonforfeitable when
made .
For Limitation Years beginning on or after January 1, 1998, for purposes of applying the
limitations of this Article, compensation paid or made available during such Limitation Year
shall include any elective deferral (as defined in Code Section 402(g)(3)), and any amount which
is contributed or deferred by the Employer at the election of the Employee and which is not
includible in the gross income of the Employee by reason of Code Section 125 or 457 .
b . Defined Contribution Plan(s) Only : The Annual Addition to.a
Participant's individual account hereunder (together with the Annual Additions to the
Participant's account(s) under any other defined contribution plan(s) maintained by an
Affiliated Employer) for any Limitation Year may not exceed the lesser of:
(1) Thirty Thousand Dollars ($30,000.00) (as adjusted under
subsection 415( d) of the Code for such Limitation Year); or
(2) Twenty-five percent (25%) of the Participant's Earnings for the
Limitation Year.
c . Defined Benefit Plan(s) Only :
•
•
(1) Any annual Pension payable to a Participant hereunder (including •
any annual Pension paid to such Participant from another defined benefit plan of
XI-2
02-29144.07
•
•
•
02-29144.07
the Employer) shall not exceed Ninety Thousand Dollars ($90,000) adjusted for
increases in the cost of living, as prescribed by the Secretary of the Treasury or
his delegate, effective January I of each calendar year and applicable to the
Limitation Year ending with or within such calendar year.
(2) Except as provided in the following, which imposes additional
limitations on the amounts payable to Participants with less than ten (I 0) years of
Service, the foregoing limitation shall not be applicable with respect to any
Participant whose annual Pension under this Plan and any other defined benefit
plan maintained by the Employer, is less than Ten Thousand Dollars ($10,000)
and such Participant has not at any time participated in any defined contribution
plan (within the meaning of Section 41 S(k) of the Code) maintained by the
Employer.
(3) In the event that a participant has been credited with less than ten
(10) years of Service, the maximum annual Pension allowable under this Section
shall be reduced by multiplying such maximum annual Pension by a fraction, the
numerator of which is the number of such Participant's years of Service (or part
thereof), but never less than one (1), and the denominator of which is ten (10).
(4) (a) The limitations of this Section apply to a straight life
annuity with no ancillary benefits and to an annuity that constitutes a
qualified joint and survivor annuity, provided payment begins between
ages sixty-two (62) and sixty-five (65). If payment is in a different form,
the amount thereof shall be adjusted to be the Actuarial Equivalent of a
single life annuity and the limitations shall be applied to such adjusted
amount.
(b) If payment begins before the Participant's attainment of age
sixty-two (62), the limitation in c.(l) above shall be reduced on an
Actuarial Equivalent basis ; provided, however, if such payment begins
after the Participant attains age fifty -fi ve (55), the reduced limit shall not
be le .ss than seventy-five Thousand Dollars ($75,000) and, if payment
begins prior to the Participant attaining age fifty-five (55), the reduced
limit shall not be less than the Actuarial Equivalent of the seventy-five
Thousand Dollar ($75 ,000) limit for age fifty-five (55); (provided, further,
however, as to police or firefighters who are Participants in this Pl~n, in no
event shall such amount be reduced below Fifty Thousand Dollars
($50,000), adjusted for increases in the cost of living, as prescribed by the
Secretary of Treasury or his other delegate).
For Limitation Years beginning on or after January I, 1997, the
provisions of this subsection ( 4)(b) shall not apply to Participants who are
"qualified participants" under Code Section 415 (b )(2)(G) .
( c) If payment begins after the Participant's attainment of age
sixty-five (65), the limitation in c.(1) above shall be the Actuarial
XI-3
Equivalent of such amount otherwise applicable at the Participant's
attainment of age sixty-five (65).
( d) The interest rate to be used in determining Actuarial
Equivalence shall be the rate specified in Article I, Section 2.b. hereat:
however, the interest rate used in determining an Actuarially Equivalent
single life amount or an Actuarially Equivalent pre-age sixty-two (62)
amount shall not be less than five percent (5%) and the interest rate used
in determining an Actuarially Equivalent post-age sixty-five (65) amount
shall not be greater than five percent (5%).
(5) In no event shall a Participant's maximum annual Pension
allowable under this Section be less than the annual Pension (including early
Pension and qualified joint and survivor annuity amounts) duly accrued by such
Participant (under Code Section 415 limitations then in effect) as ofDecember 31,
1982 , or as ofDecember 31, 1986 , whichever is greater (disregarding any Plan
changes or cost-of-living adjustments occurring after July 1, 1982, as to the 1982
accrued amount, and May 5, 19 86, as to the 1986 accrued amount).
(6) For Limitation Years beginning on and after January 1, 1995 , the
provisions of subsections (3) and ( 4)(b ) shall not apply to Death Benefits under
Article VII.
•
d . Defined Benefit and Defined Contribution Plans : If, in any Limitation •
Year a Participant also participates in one or more defined contribution plans maintained
by the Employer, then for such Limitation Year, the sum of the Defined Benefit Plan
Fraction and Defined Contribution Plan Fraction (as described below) for such Limitation
Year shall not exceed one . The Defined Benefit Fract ion for any Limitation Year shall
mean a fraction (a) the numerator of which is the projected annual benefit of the
Participant under the Plan (determined as of the close of the Limitation Year), and (b) the
denominator of which is the lesser of 125% of the dollar limitation under Code Section
415(b)(l)(a) or 140% ofthe percentage limitation under Code Section 415(b)(l)(B) for
the year of determination (taking into account the effect of Section 235(g)(4) of the Tax
Equity and Fiscal Responsibility Act of 1982). The Defined Contribution Fraction for
any Limitation Year shall mean a fraction (a) the numerator of which is the sum of the
Annual Additions to the Participant's accounts under all defined contribution plans
maintained by the Employer as of the close of the Limitation Year (subject to reduction
to the extent permitted under the transition rule in Section 235(g)(3) of the Tax Equity
and Fiscal Responsibility Act of 1982), and (b) the denominator of which is the sum of
the lesser of 125% of the dollar limitation under Code Section 415(c)(l)(A) or 140% of
the percentage Limitation under Code Section 415(c)(l)(B), for such Limitation Year and
for all prior Limitation Years during which the Employee was employed by the Employer
(provided , however, at the election of the Board, the denominator shall be increased by
using for Limitation Years ending prior to January 1, 1983 , an amount equal to the
denominator in effect for the Limitation year ending in 1982, multiplied by the transition
fraction provided in Code Section 415 (e) (6) (B)). •
XI-4
02-29144.07
•
•
•
, .
It: in any Limitation Year, the sum of the Defined Benefit Plan Fraction and
Defined Contribution Plan Fraction for a Participant would exceed one without
adjustment of the amount of the maximum annual Pension that can be paid to such
Participant under paragraph c.(l) of this Section, than the amount of the maximum annual
Pension that can be paid to such Participant under paragraph c.(1) of this section, shall be
reduced to the extent necessary to reduce the sum of the Defined Benefit Plan Fraction
and Defined Contribution Plan Fraction for such Participant to one, or the Board may
take such other actions as will cause the sum to equal one or less.
This subsection d. shall not be effective for years beginning on or after January 1,
2000 .
XI-5
02-29144.07
ARTICLE XII
Guarantees and Liabilities
Section 1. Nonguarantee ofEmployment: Nothing contained in this Plan shall be
construed as a contract of employment between the Employer and any Employee, or as a right of
any Employee to be continued in the employment of the Employer, or as a limitation of the right
of the Employer to discharge any of its Employees, with or without cause.
Section 2. Rights to Trust Assets: No Employee shall have any right to, or interest
in, any assets of the Trust Fund upon termination of his employment or otherwise, except as
provided from time to time under this Plan, and then only to the extent of the benefits payable to
such Employee out of the assets of the Trust Fund . Neither the Employer, the Trustee, nor any
member of the Board shall be liable to any Employee or Beneficiary for benefits from this Plan,
except for those payable from the Trust Fund to a Participant in accordance with the terms of the
Plan and the Trust .
Section 3 . Nonalienation of Benefits : Benefits payable under this Plan shall not be
subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, charge, garnishment, execution, or levy of any kind , either voluntary or
involuntary, either prior to or subsequent to being received by the person entitled to. the benefit
under the terms of the Plan . Any attempt to anticipate, alienate, sell, transfer, assign, pledge,
encumber, charge or otherwise dispose of any right to benefits payable hereunder shall be void.
The Trust Fund shall not in any manner be liable for, or subject to, the debts, contracts,
liabilities, engagements, or torts of any person entitled to benefits hereunder. None of the unpaid
Plan benefits or Trust assets shall be considered an asset of the Participant in the event of his
insolvency or bankruptcy.
XII-I
02-29144.07
•
•
•
• Notwithstanding the foregoing, in accordance with Section 31-30.5-208, Colorado
Revised Statutes (and prior to May 23, 1996, Section 31-30-412, Colorado Revised Statutes), the
Board may approve : (1) payment to an alternate payee based upon an assignment for child
support purposes as provided for under Sections 14-10-118(1) and 14-14-107, Colorado Revised
Statutes, as those statutes existed prior to July 1, 1996; (2) income assignments for child support
purposes as provided for under Section 14-14-111.5, Colorado Revised Statutes, effective July 1,
1996 ; (3) writs of garnishment that are the result of a judgment taken for arrearages for child
support or for child support debt; and (4) effective January 1, 1997, payments made in
compliance with a properly executed court order approving a written agreement entered into
pursuant to Section 14-10-113(6), Colorado Revised Statutes . Such payments shall not be
deemed a prohibited alienation of benefits . The Board may promulgate rules or procedures
• governing the implementation of such court orders, commonly known as domestic relations
orders. Such rules or procedures may include the requirement that a standardized form be used
•
by the parties and the court for an order approving the parties' agreement to be effective as well
as other provisions consistent with the purpose of Colorado Revised Statutes 14-10-113(6) .
XII-2
02-29144.07
ARTICLE XIII
Amendments
Section I. Right to Amend: The Employer (or other body duly authorized by the
Employer) reserves the right to make, from time to time, any amendment or amendments to this
Plan which do not permit reversion of any part of the Trust Fund to the Employer except as
provided in Article XIV, Section 4., and which do not cause any part of the Trust Fund to be
used for, or diverted to, any purpose other than the exclusive benefit of Participants included in
this Plan and which does not , directly or indirectly , reduce any Participant's Accrued Pension
unless such amendment is required in order to maintain the P lan 's qualified status under Code
Section 40 1(a); provided , howe ver, that no such amendment ma y be made without the consent of
at least sixty-five percent (65%) of the active Participants, at the time the Plan is so amended, as
provided in Section 31-30 .5-210 of the Colorado Revised Statutes.
XIII-I
02-29144.07
•
•
•
•
•
ARTICLE XIV
Withdrawal and Tennination
Section I . Plan Termination: If pennitted by Colorado statutes and approved by the
Colorado Fire and Police Pension Association, the Employer may at any time, by adoption of a
resolution, terminate this Plan.
A partial tennination of this Plan will occur if required under the qualification
requirements of Section 40 I (a) of the Code.
Section 2. Allocation of Assets Upon Plan Termination : Upon termination or partial
tennination of the Plan, the benefits accrued up to the date of termination by the affected
Participants and their beneficiaries, respectively, shall be nonforfeitable; however, actual
payment of such benefits shall only be to the extent permitted from the Plan assets . The assets of
the Trust Fund shall be allocated to provide such nonforfeitable benefits, to the extent possible,
in the order of precedence determined by the Board at such time .
Section 3 . Manner of Distribution: Any distribution after tennination of the Plan
may be made at any time, and from time to time, in whole or in part, to the extent that no
discrimination in value results, in cash, in securities, or other assets in kind (at fair market value),
in the form of a Pension or a continued Pension, in nontransferable annuity contracts, or in
installments, as the Board, in its discretion, shall determine. In making such distribution, any
and all determinations, appraisals, apportionments and allotments shall be made by the Board
acting under the information supplied by the actuary and shall be final and conclusive and not
subject to question by any person.
Section 4 . Amounts Returnable to the Employer: In no event shall the Employer
• receive any amounts from the Trust, except such amounts, if any, as set forth below:
XIV-I
02-29144.07
. .
a. Upon termination of the Plan the Employer shall receive such amounts, if
any, as may remain after the satisfaction of all liabilities of the Plan to its Participants and •
their beneficiaries, and arising out of any variations between actual requirements and
expected actuarial requirements.
b. In the event of a contribution made by the Employer by a mistake of fact,
such contribution may be returned to such Employer within one (1) year after payment
thereof
c . If the Employer's determination letter issued by the District Director of
Internal Revenue as to the Employer's adoption of this Plan is an initial determination
letter and is to the effect that the Plan and Trust herein set forth or as amended prior to
the receipt of such letter do not meet the requirements of Sections 40l(a) and 50l(a) of
the Code, the Employer shall be entitled to withdraw, within one (I) year of the date of
issuance of such letter, all of its contributions made on and after the Effective Date, as
though it had never adopted this Plan and Trust.
Section 5. Applicable Law : All questions arising with respect to the provisions of
this Plan shall be determined by the application of the laws of the State of Colorado, except to
the extent such law is preempted by Federal statute.
XIV-2
02-29144 .07
•
•
•
•
•
ARTICLE XV
Direct RoIIovers
=S-=-ectt=·o=n.:....:..1'-. -----=Ge=n=er"""a __ l: This Article applies to distributions made on or after January 1,
1993. Notwithstanding any provision of the Plan to the contrary that would otherwise limit a
Distributee's election under this Article, a Distributee may elect, at the time and in the manner
prescribed by the Board, to have any portion of an Eligible Rollover Distribution which exceeds
$200 paid directly to an Eligible Retirement Plan specified by the Distributee in a Direct
Rollover. If a Distributee' s Direct Rollover Distribution is less than $500, the Distributee may
only elect to Direct Rollover 100% of the Eligible Rollover Distribution.
Section 2 . Definitions :
a . Eligible Rollover Distribution : An Eligible Rollover Distribution is any
distribution of all or any portion of the balance to the credit of the Distributee, except that
an Eligible Rollover Distribution does not include : any distribution that is one of a series
of substantially equal periodic payments (not less frequently than annually) made for the
life (or life expectancy) of the Distributee or the joint lives (or joint life expectancies) of
the Distributee and the Distributee' s designated Beneficiary, or for a specified period of
ten years or more; any distribution to the extent such distribution is required under Code
Section 401 ( a)(9); and the portion of any distribution that is not includable in gross
income (determined without regard to the exclusion for net unrealized appreciation with
respect to Employer securities).
b . Eligible Retirement Plan: An Eligible Retirement Plan is an individual
retirement account described in Code Section 408(a), an individual retirement annuity
described in Code Section 408(b), an annuity plan described in Code Section 403(a), or a
qualified trust described in Code Section 40l(a), that accepts the Distributee 's Eligible
Rollover Distribution. However, in the case of an Eligible Rollover Distribution to the
surviving spouse, an Eligible Retirement Plan is an individual retirement account or
individual retirement annuity .
c . Distributee: A Distributee includ es an Employee or former Employee. In
addition, the Employee's or former Employee's surviving spouse and the Employee's or
former Employee's spouse or former spouse who is the alternate payee under a qualified
domestic relations order, as defined in Code Section 4 l 4(p ), are Distributees with regard
to the interest of the spouse or former spouse .
d . Direct Rollover : A Direct Rollover is a payment by the Plan to one
Eligible Retirement Plan specified by the Distributee.
02-29144.07 XV-1
. .
e. Waiver of 3 0 Day Notice for Cashouts of $5. 000 ($3. 500 prior to
January I. 1998) or Less: If a distn'bution is one to which Code Sections 40l(a)(l 1) and •
417 do not apply, such distribution may commence less than thirty (30) days after the
notice required under Treasury Regulation Section 1. 411 ( a)-11 ( c) is given, provided that:
02·29144.07
(1) the Board clearly informs the Participant that the Participant has a
right to a period of at least thirty (30) days after receiving the notice to consider
the decision of whether or not to elect a distribution (and, if applicable, a
particular distribution option), and
(2) the Participant, after receiving the notice, affirmatively elects a
distribution.
XV-2
•
•
•
• IN WITNESS WHEREOF, and as conclusive evidence of the adoption of the foregoing
instrument comprising City ofEnglewood Firefighters Pension Plan (As Amended and Restated
January 1, 1999), the Employer has caused its seal to be affixed hereto and these presents to be
duly executed in its name and behalf by its proper officers thereunto authorized this __ day of
19 _____ __, --
ATTEST: CITY OF ENGLEWOOD, COLORADO
By _____________ _
City Clerk -I.oucrishia A. Ellis NJayor -Thorms J. Burns
•
•
02-29144.07 XV-3
•
•
•
COUNCIL COMMUNICATION
Date Agenda Item Subject A bill for an ordinance
adopting the City of Englewood
Firefighters Pension Plan
August16 , 1999 10 a iii Document (the Plan)
Initiated By Staff Source
Department of Financial Services Frank Gryglewicz, Director of Financial Services
COUNCIL GOAL AND PREVIOUS COUNCIL ACTION
The City Council discussed this issue at a study session held on September 8, 1998. Council gave
staff direction to proceed with this bill for an ordinance.
RECOMMENDED ACTION
Staff recommends the City Council approve the attached bill for an ordinance.
BACKGROUND, ANALYSIS, AND ALTERNATIVES IDENTIFIED
This ordinance does not substantially change the current level of pension benefits for the "old hire"
firefighters. The Plan document mirrors the current benefits as defined in Colorado State Statutes.
The ordinance provides plan participants the option of participating in a Deferred Retirement Option
Plan (DROP). The document provides an increased additional death benefit of $500 for participate
firefighters.
The Plan document is amended to comply with state statutes, federal guidelines and provide a
Deferred Retirement Option Plan (DROP) benefit for the participants.
No other alternatives were considered.
FINANCIAL IMPACT
This action will cost the Firefighter Pension Fund an estimated $21,200. The Fund is currently fully
funded.
LIST OF ATTACHMENTS
Proposed bill for an ordinance