HomeMy WebLinkAboutBack-Up from Law Dept• DIVISION 3. - CITY OF MIAMI GENERAL EMPLOYEES' AND SANITATION
EMPLOYEES' RETIREMENT TRUST
• Sec. 40-241. - Definitions.
The following words and phrases as used in this division shall have the following meanings:
Accumulated employee contributions shall mean the sum of all amounts deducted from a
member's compensation or picked up on behalf of a member, together with regular interest as
provided in this division. Accumulated employee contributions shall also mean any amounts paid
by a member for the purchase of military service credits or other paybacks permitted in this Plan.
Active membership shall mean membership in the Plan as an employee.
Actuarial equivalent shall mean a benefit having the same present value as the benefit it
replaces based upon the actuarial table adopted by the board of trustees. For purposes of
determining actuarial equivalence under Internal Revenue Code Section 415, the applicable
mortality table will be the table under Internal Revenue Code § 417(e)(3)(B).
And shall have a conjunctive meaning.
Average final compensation shall have a meaning dependent upon the date of hire and the
date of termination of service of the member. The periods of time for which average final
compensation is determined are:
(a) For members who became employed before May 24, 1984, and whose active
membership in the Plan did not cease before May 23, 1985. In the case of such members,
average final compensation shall mean the highest compensation of that member during
any one year of membership service. The highest one year of compensation shall not
exceed the second highest year of compensation by more than 15 percent excluding any
difference due to longevity, anniversary and negotiated cost of living increases. The term
"year" shall be calculated using the highest 12 months of compensation, but the months
need not be consecutive.
(b) In the case of a member who becomes an employee on or after May 24, 1984 and
who retires or terminates employment with ten or more years of creditable service prior to
October 1, 2010, or for an employee whose service has previously ended or who is not a
member absent from service, but recommences on or after May 24, 1984 who retires or
terminates employment with ten or more years of creditable service prior to October 1,
2010, average final compensation shall mean the average annual compensation of the
member during the last two years of membership service, or the highest two years of
membership service, whichever is greater. In the case of the highest two years of
membership service, the years need not be consecutive. The term "year" shall be calculated
using the highest 12 months of compensation, but the months need not be consecutive.
(c) Effective September 30, 2010, for members employed on that date who retire on
or after October 1, 2010, average final compensation shall mean: average of highest five
years of the last ten years of service, to be phased in over the next three years as follows:
average final compensation for members who retire on or after October 1, 2010 and on or
before September 30, 2011 will be based on the average of the highest three years of
membership service; for members who retire on or after October 1, 2011 and on or before
September 30, 2012, it will be based on the average of the highest four years of
membership service; and for members who retire on or after October 1, 2012, the average
of the highest five years of the last ten years of membership service. Provided, in no event
shall the average final compensation of any member who is employed on September 30,
2010 and retires on or after October 1, 2010, be less than the member's average final
compensation as of the date of the plan change.
BACDROP shall mean Benefit Actuarially Calculated Deferred Retirement Option Program.
Beneficiary shall mean any person receiving a retirement allowance or other benefit from the
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Benefit shall mean a retirement allowance or other payment provided by the Plan and made
to a member, retiree or beneficiary.
Board or board of trustees shall mean the board of trustees of the Plan.
Child shall mean the natural or adopted child of a member, but shall not include foster
children or step -children.
City shall mean the City of Miami, Florida.
City commission or commission shall mean the Miami City Commission.
COLA shall mean the cost of living adjustment provided under the terms of the Plan.
Compensation shall mean a member's base salary, including pick-up contributions for all
straight time hours worked, assignment pay, pay supplements, vacation, and sick leave used while
an active member, jury duty, and death in family leave taken or any other administrative leave
approved pursuant to ordinance, labor agreement, or city personnel policy which is used as part of
the member's base salary. Compensation shall not include overtime pay, payments for
accumulated sick leave, accumulated vacation leave, or accumulated compensatory leave,
premium pay for holidays worked, call back pay, uniform allowances, tool allowances, the value of
any other employment benefit or non -monetary entitlement, or any other form of remuneration.
The amount of compensation taken into account under the System may not exceed $200,000.00.
This amount is subject to adjustment as provided for in Internal Revenue Code Section 401(a)(17),
Internal Revenue Code Section 415(d) and Section 16 of this Plan. Beginning with compensation
earned after December 31, 2008, and pursuant to Internal Revenue Code Section 414(u)(7), the
definition of compensation includes the amount paid by the city as differential wages to members
who are absent from employment while in qualified military service.
Creditable service shall mean credit upon which a member's eligibility to receive benefits
under the Plan is based, or upon which the amount of such benefits is to be determined.
Disability shall mean the permanent and total incapacity to perform useful and efficient
service as an employee of the city as determined by the board pursuant to the terms of the Plan.
DROP shall mean Deferred Retirement Option Program and shall include a Forward DROP
and a BACDROP.
Early service retirement shall mean a member's withdrawal from service under circumstances
permitting the payment of a retirement benefit before such member is eligible for normal service
retirement.
Employee shall mean any regular, permanent, and full-time appointed officer or employee of
the city, other than a police officer or firefighter as defined in section 40-191 of the city Code. The
term "employee" shall include both classified and unclassified employees, provided they are
appointed on a full-time basis as defined by the Civil Service Rules, collective bargaining
agreement, or other applicable city personnel policy. The term "employee" shall also include
members of this Plan who become employees of Miami -Dade County by virtue of the merger,
transfer, or assignment of governmental units or functions from the city to Miami -Dade County.
Any such employee shall continue as a member of this Plan unless they elect within six months
after the date of the transfer to become a member of the Florida Retirement System. For the
purpose of any such employee, Miami -Dade County shall be deemed included within the term
"city" as used in this Code. Temporary, part-time or casual employees shall not be deemed
"employees."
Forward DROP shall mean a Deferred Retirement Option Program where benefit is equal to
the regular retirement benefit the member would have received had the member separated from
service and commenced the receipt of benefits from the plan.
Full time shall mean an employee who is compensated on a 40 hour per week basis.
Fund shall mean the City of Miami General Employees' and Sanitation Employees'
Retirement Trust Fund.
General Employees' Union shall mean the certified collective bargaining agent for all general
employees of the city, except sanitation employees, managerial employees and confidential
employees.
Internal Revenue Code shall mean the Internal Revenue Code of 1986, as amended from
time to time.
May shall mean a permissive term.
Member shall mean an employee for whom contributions to the Plan are picked up as
required by this Plan.
Member absent from service shall mean any member who has ceased to be an employee for
less than three years in a period of five consecutive years after last becoming a member, and who
has not withdrawn the accumulated employee contributions.
Member not in service shall mean any member who has a vested right to retirement pursuant
to the provisions of this Plan. A member not in service shall also be known as a vested separated
member. This term shall not include retired members who have been rehired by the city in
positions not eligible for participation in this Plan.
Membership service shall mean service as an employee for which contributions to the Plan
were made as required by this Plan.
Miami City General Employees' Retirement Plan shall mean the city pension plan which was
established effective July 1, 1956, pursuant to Ordinance No. 5624, enacted May 2, 1956, as
amended.
Noninvestment expenses shall exclude fees paid to money managers whose duty it is to
invest and manage the assets of the Plan and to report on the performance of those investments.
Salaries for office staff, overhead, professional fees for actuaries, accountants, financial
consultants, performance monitors and attorneys, and other similar nonbenefit costs are examples
of non -investment expenses.
Normal costs shall mean the cost of benefits attributable to the current year under the
modified aggregate entry age normal cost method.
Normal retirement age shall mean age 55 for members employed on September 30, 2010
who have attained age 55 by that date and members who retire or terminate employment with ten
or more years of creditable service prior to October 1, 2010. Normal retirement age shall mean the
earlier of age 60 with ten years of creditable service or age 55 with 30 years of creditable service
for members who have not attained age 55 as of September 30, 2010 and all other members who
retire on or after October 1, 2010. All members are 100 percent vested upon reaching normal
retirement age.
Option shall mean one of several choices available to members with respect to the manner in
which a retirement benefit may be paid.
Payback shall mean a member's contribution to the Plan for creditable service for which other
than regular contributions have been made. Contributions required for paybacks shall not be
picked up by the city, but may be deducted from a member's compensation.
Pick-up amounts shall mean employer contributions derived from a member's compensation
through a reduction in the member's compensation. For the purposes of this Plan, amounts
picked -up shall be considered for state law purposes as employee contributions.
Plan shall mean the City of Miami General Employees' and Sanitation Employees' Retirement
Trust.
Plan year shall mean the period from October 1 through September 30 of the following year.
Pre-existing condition shall mean a condition of health which pre -dated any period of Plan
membership.
Regular contributions shall mean amounts picked -up by the city from the compensation of a
member. Regular contributions shall not include payback contributions or any other amounts which
may be deducted from a member's compensation pursuant to this division.
Regular interest shall mean interest at the rate prescribed by the board of trustees which
shall be not less than one percent per quarter of the contribution balance as of the end of the
previous calendar year, including interest.
Retiree shall mean a former member who is in receipt of benefits from the Plan.
Retirement shall mean a member's withdrawal from service with a benefit granted to the
member pursuant to the provisions of this Plan.
Rule of 70 shall mean a computation permitting normal retirement where the sum of the
member's age and length of creditable service is equal to at least 70, provided that the member
has completed ten years of creditable service.
Sanitation Employees' Union shall mean the certified collective bargaining agent for all
sanitation employees of the city, except for managerial employees, confidential employees and
employees covered by another collective bargaining unit.
Service shall mean active employment as an employee of the city.
Service retirement shall mean a member's retirement from service under circumstances
permitting payment of a retirement benefit without reduction because of age, length of service, or
both and without special qualifications such as disability.
Spouse shall mean the lawful husband or wife of a member or retiree at the time benefits
commence, unless a new designation has been made in writing to the board in accordance with
the provisions of this Plan. This section shall be interpreted under Florida choice of law rules.
Surviving spouse means the spouse of the member at the time benefits commence unless a
new designation has been made in accordance with the provisions of this Plan.
Trustee shall mean a member of the board of trustees of the Plan.
Useful and efficient service shall mean the performance of the regular duties of the position to
which the employee is assigned by the city. The board shall determine from the facts of each
disability application whether the member is performing in accordance with this definition.
Unfunded liability shall mean the excess of the actuarial accrued liability of the Plan over
(the) present asset value used to determine the city's funding obligation.
Vested benefit shall mean an immediate or deferred benefit to which a member has gained a
non -forfeitable right under the provisions of this Plan, without the need for additional creditable
service.
Vesting shall mean ten years of creditable service before the member is entitled to service
retirement benefits and non -service disability.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 12202, § 2, 3-27-02; Ord. No. 13203, § 2, 9-27-10; Ord. No.
13679, § 1, 5-11-17)
• Sec. 40-242. - Plan established; purpose; name; operative date.
A Plan is established and placed under the exclusive administration and management of a board
of trustees for the purpose of providing retirement benefits pursuant to the provisions of this Code
and for payment of the reasonable expenses of the Plan. This Plan shall be known as the "City of
Miami General Employees' and Sanitation Employees' Retirement Trust." This Plan is intended to
be a tax qualified plan under Internal Revenue Code Section 401(a) and meet the requirement of a
governmental plan as defined in Internal Revenue Code Section 414(d).
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13679, § 1, 5-11-17)
• Sec. 40-243. - Board of trustees.
(a) Composition and selection.
(1) The sole and exclusive administration of and responsibility for the proper and
effective operation of this Plan is vested in a nine member board of trustees.
(2) The board of trustees shall be selected as follows:
a. One trustee shall be selected by the city manager, which trustee shall not
be the mayor, a city commissioner, the city manager, the city finance director, or an
assistant finance director.
b. Two trustees shall be selected by the general employees and their names
submitted to the city clerk. The trustee may be a present or retired member of the
bargaining unit represented by the General Employees' Union and shall be selected and
serve according to the constitution and bylaws of the General Employees' Union.
C. Two trustees shall be selected by the sanitation employees and their
names submitted to the city clerk. The trustees shall be present members of the
bargaining unit represented by Sanitation Employees' Union and shall be selected and
serve according to the constitution and bylaws of the Sanitation Employees' Union.
d. The remaining four trustees shall be selected by the city commission and
may not be employees of the city. Two of the trustees shall be selected from a list of six
persons submitted by the General Employees' Union according to its constitution and
bylaws and the other two trustees shall be selected from a list of six persons submitted by
the Sanitation Employees' Union according to its constitution and bylaws. The city
commission may, at the request of the General Employees' Union or the Sanitation
Employees' Union, accept a list consisting of one name for each position to be filled. The
lists submitted to the city commission shall not contain duplications. If a duplication
occurs, the city commission shall return both lists for resubmission.
e. The trustees appointed by the city shall have, at the minimum, the
following qualifications:
1. Be presently employed or self-employed on a full-time basis, or be retired
from such;
2. Have resided in Miami (or its immediate environs) for the past five years;
3. Be able to attend board meetings if scheduled well enough in advance and
agree to resign from the board if meeting attendance is less than 75 percent in a
one-year period; however, the provisions of this subsection shall not apply to
those individuals who are members of city boards and who are (1) reservists in
the United States Armed Forces or members of the Florida National Guard, and
have been ordered to active military duty for national, state, or homeland defense
and due to such duty cannot attend board meetings, or (2) employees of agencies
whose services are considered essential for national, state, or homeland defense
and due to such services cannot attend board meetings.
4. Have been involved in, within the last five years, and be knowledgeable
about employee pension or similar fringe benefits;
5. Have knowledge of, be familiar with, and have had exposure to
labor/management relations;
6. Have knowledge of and be familiar with business principles;
7. Have not been, within the past five years, a public employee union
representative, nor a representative of management for the city;
8. Not be actively involved in nor aspire to be actively involved in city, county,
or state politics.
(b) Term of office.
(1) The term of office for each trustee shall be two years.
(2) There shall be no limit to the number of terms a trustee may serve.
(3) A trustee shall take an oath of office administered by the city clerk within ten days
after selection.
(4) A trustee shall serve until a successor trustee is appointed and administered the
oath of office.
(c) Fiduciary responsibility. The board of trustees shall be deemed the named fiduciary of the
Plan and shall discharge its responsibilities solely in the interest of the members and
beneficiaries of the Plan for the exclusive purpose of providing benefits to the members and their
beneficiaries and to defray the reasonable expenses of the Plan. The trustees shall exercise
those fiduciary responsibilities with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent person acting in a like capacity and familiar with
such matters would use in the conduct of an enterprise of a similar character and with similar
aims.
(d) Compensation. Trustees who are employees of the city shall be granted leave with full
pay and benefits while functioning as a trustee during their normal working hours. Service on the
board shall not be considered as "time worked" for the purposes of overtime liability under the
Fair Labor Standards Act. This shall include attendance at board meetings, workshops, board
approved educational conferences and board approved travel. Employee trustees shall not
otherwise be paid for their services as trustees. The nonemployee trustees shall be compensated
at any given time in the same manner as are members of the city's civil service board.
(e) Meetings; voting; quorum; officers.
(1) The board shall meet at least once every two months following appropriate public
notice and shall meet and conduct the business of the Plan in accordance with Chapter
286, Florida Statutes.
(2) Each trustee shall be entitled to one vote. Five concurring votes shall be
necessary for a decision by the board. Five trustees shall constitute a quorum for the
purpose of meeting and transacting business. A lesser number of trustees may be
appointed as a committee to perform tasks on behalf of the board. All committee
meetings shall be subject to the notice and meeting requirements of Chapter 286, Florida
Statutes.
(3) The board shall elect, every two years, a trustee as chairperson and a trustee as
vice chairperson of the board.
(f) Vacancies; removal.
(1) If a vacancy occurs due to resignation, death, or removal, the vacancy shall be
filled for the unexpired term of the departing trustee in accordance with the provisions of
this section for selection of the trustee who has vacated the office.
(2) The board may remove a trustee prior to completion of his or her designated term
of office for proper cause only, which cause shall be stated in writing. No trustee shall be
removed pursuant to this section except upon proper notice and hearing. The board shall
prescribe uniform rules for the conduct of such hearings. Proper cause shall mean a
trustee's failure to satisfactorily discharge his or her fiduciary responsibility, including, but
not limited to, failure to attend 75 percent of the meetings of the board in a one-year
period. For the purposes of removal only, six concurring votes shall be necessary.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 12201, § 1, 3-14-02)
• Sec. 40-244. - Administration of the Plan; liability; misconduct of a co -trustee.
(a) Administrative duties of the board.
(1) To maintain such records as are necessary for calculating and distributing Plan
benefits;
(2) To maintain such records as are necessary for financial accounting and reporting
of Plan funds;
(3) To maintain such records as are necessary for actuarial evaluation of the Plan,
including investigations into the mortality, service and compensation experience of its
members and beneficiaries;
(4) To compile such other administrative or investment information as is necessary
for the management of the Plan;
(5) To process, certify and respond to all correspondence, bills and statements
received by the Plan, as well as all applications submitted to the board for Plan benefits;
(6) To establish and maintain communication with city departments, and other
agencies of government as is necessary for the management of the Plan, including
preparing, filing and distributing such reports and information as are required by law to be
prepared, filed or distributed on behalf of the Plan;
(7) To determine all questions relating to, and process all applications for eligibility,
participation and benefits;
(8) To distribute at regular intervals a comprehensive summary Plan description and
periodic reports to employees, not less than biennially, regarding the financial and
actuarial status of the Plan;
(9) To retain and compensate such professional and technical expertise as is
necessary to fulfill its fiduciary responsibilities;
(10) To make recommendations regarding changes in the provisions of the Plan;
(11) To assure the prompt deposit of all member contributions, city contributions, and
investment earnings;
(12) To establish a uniform set of rules and regulations for the management of the
trust;
(13) To take such other action as the trustees shall deem, in their sole and exclusive
discretion, as being necessary for the efficient management of the Plan.
(b) Pension administrator.
(1) The board shall employ a pension administrator to assist the board in the
performance of its administrative duties. The pension administrator, subject to the
approval of the board, may employ such staff as is necessary for the proper
administration of the Plan.
(2) The pension administrator selected by the board shall have, at the minimum, the
following qualifications:
a. Accounting or pension administration background;
b. Managerial experience, including hiring, directing and motivating a small
staff;
C. Sufficient knowledge or experience to supervise data processing
operations;
d. Experience with filing government forms (including federal and state
compliance requirements) and have the initiative to inquire and successfully
obtain resource data when specific information is not readily available;
e. Be capable of using benefit formulas to calculate and pay benefits;
f. Be capable of prudent financial management and obeying guidelines
established by the board;
g. Be capable of developing cash flow projection;
h. Be capable of preparing financial reports reflecting the activity of the trust
and financial trends;
i. Be capable of maintaining an investment schedule;
j. Be capable of maintaining minutes of the meetings of the board;
k. Be capable of preparing correspondence, issuing forms, receiving and
processing benefit claims, and expressing ideas in writing;
I. Be able to insist upon, and actively pursue delivery of, all reports and
other documents required for the efficient operation of the Plan;
M. Effective oral communication skills;
n. A good employment attendance record;
o. Be efficient, practical and committed to responsible and effective operation
of the Plan, its finances and expenses;
P. Be able to remain neutral on decisions to be made by the board and serve
all board members in an impartial and arm's length fashion, giving due recognition
to the ultimate fiduciary obligation to participants and beneficiaries of the Plan.
(3) The board shall have a continuing duty to observe and evaluate the performance
of the pension administrator. The board shall, in selecting a pension administrator,
exercise all judgment and care under the circumstances then prevailing which persons of
prudence, discretion, and intelligence, exercise in the management of their own affairs.
(4) The pension administrator shall have a written contract of employment with the
board, which shall include any tenure rights which the board, in its discretion, may grant.
(5) The pension administrator shall not be an employee of the city.
(6) The pension administrator shall be a fiduciary of the Plan.
(c) Annual report to the city commission. The board shall submit the following information
annually to the city commission not later than July 1 s, of each year:
(1) A report showing the fiscal transactions of the Plan for the year ending on the
preceding September 30 th , as well as the amount of accumulated cash, securities and
other property of the Plan.
(2) The current actuarial valuation of the assets and liabilities of the Plan.
(d) Actuarial valuation; actuarial standards.
(1) At least once in each three-year period, the board shall cause an actuarial
investigation to be made into the mortality, service and compensation experience of the
members of the Plan. Taking into account the result of such investigation, the board shall
adopt for the Plan, such mortality, service and other tables as are necessary and proper.
On the basis of these tables, an annual actuarial valuation of the assets and liabilities of
the Plan shall be made.
(2) Actuarial assumptions based on the three-year experience analysis may be
modified by the board at such times as it deems appropriate. No change in actuarial
assumptions shall be made by the board without 60 days' prior notice to the city of the
first meeting at which any change or proposal or recommendation related to such change
is made. After the initial meeting where such changes or proposals are considered, the
city shall be given reasonable notice of any subsequent meeting on the same or related
proposal.
(3) The actuarial value of the assets of the Plan shall be the five-year moving market
value average. Each year, starting with the market value as of October 1, 2007, the
expected return will be determined based on the beginning of year market value and the
actual contribution and benefit payments at the assumed interest assumption. One-fifth of
the difference between the expected market value return and the actual market value
return is included in the actuarial asset value at the valuation date. Four-fifths of the
difference between the expected market value return and the actual market value return
is deferred in even increments of 20 percent per year to each of the next four years as
future adjustments to the actuarial asset value. The preliminary actuarial asset value will
be the sum of the actuarial asset value as of the previous valuation date plus the actual
contributions and benefits payments in the year ending on the current valuation date plus
the expected return on market value return plus one-fifth of the cumulative differences
between the expected and actual market value returns over the five years up to the
valuation date. The result cannot be greater than 120 percent of market value or less than
80 percent of market value. The board may approve other methods of determining the
actuarial value of the Plan assets if such other methods are recommended by the actuary
retained by the board and found by the Florida Bureau of Local Retirement Systems,
Division of Retirement, Department of Administration, or its successor, to be in
compliance with state law. Prior to the first meeting of the board to consider any change
in the method of determining the actuarial value of Plan assets, the city shall be given
timely written notice of the proposed change.
(e) Authority to hire consultants.
(1) The board shall have the authority to retain its own legal consultants,
accountants, actuaries, and other professional advisors to assist the board in the
performance of its duties. The board may act without independent investigation upon the
professional advise of the advisors so retained.
(2) The board shall retain a physician to assist it in the performance of its
administrative duties with regard to the consideration of medical questions arising under
the Plan. The physician shall conduct any required medical examinations or refer the
examinee to a specialist or specialists.
(f) Defense of actions; trustee liability.
(1) The board is authorized to prosecute or defend actions, claims or proceedings of
any nature or kind for the protection of the fund assets or for the protection of the board in
the performance of its duties.
(2) Neither the board nor any of its individual members shall have any personal
liability for any action taken in good faith. The trustees individually and the board as a
whole shall be entitled to the protections contained in § 768.28, Florida Statutes. The
trustees shall also be authorized to purchase from the assets of the fund, errors and
omission insurance to protect the trustees and staff in the performance of their duties.
Such insurance shall not provide an individual with protection against a fiduciary's fraud,
intentional misrepresentation, willful misconduct or gross negligence.
(g) Public records; board documents; written communications to and from city; commission
agenda.
(1) The board shall keep a record of all of its proceedings which shall be maintained
and open to public inspection in accordance with Chapters 119 and 286, Florida Statutes.
Such records shall reflect a complete and comprehensive account of the discussions and
actions taken by the board.
(2) The board and the city manager shall each provide the other with copies of all
documents relating to the Plan contemporaneously upon the making or receipt of such
documents. All written communications relating to the Plan from the board to the city shall
be made directly to the city manager. All written communications to the board from the
city shall be made directly to the board, with copies to the pension.
(3) The board shall establish uniform procedures for maintaining confidentiality of
medical information as required by state and federal law.
(4) When consideration by the city commission is required for Plan business, such
business shall be placed on the agenda of the commission and heard at the next
scheduled meeting, consistent with the agenda rules of the commission.
(h) Rules and regulations. The board may, from time to time, establish rules and regulations
which it deems necessary for the efficient administration and management of the Plan. No
administrative rule may conflict with the provisions of the City Charter or Code, state or federal
law. No administrative rule of the fund may conflict with the provisions of any collective
bargaining agreements affecting members of the Plan.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13090, § 1, 9-24-09)
• Sec. 40-245. - Asset management and investments.
(a) Nature of trust. The Plan is an irrevocable trust fund into which is deposited all of the
assets of the Plan of every kind and description. The Plan is a defined benefit retirement fund.
Members have an ownership right in benefits accrued as provided for in this Plan. No member
has an ownership right in the assets of the Plan.
(b) Custody; records. The custody and supervision of the fund shall be vested in the board.
All assets of the Plan may be pooled, provided that accurate records are maintained at all times
reflecting the financial composition of the fund, including accurate accounts regarding the
following:
(1) Current amounts of accumulated contributions of members, both on an individual
and aggregate basis;
(2) Receipts and disbursements;
(3) Benefits payments;
(4) All contributions from the city;
(5) All interest, dividends, gains and losses from investment;
(6) Such other entries as may be required for a clear, complete financial report of the
status of the fund.
(c) Investment policy. The board shall maintain a written investment policy, with the advice
and counsel of such advisors as the board deems necessary, and said investment policy shall set
forth the types of securities and other types of investments into which shall be placed the assets
of the fund. The policy shall further set forth appropriate limitations on those investments,
including, but not limited to, anticipated rate of return, quality of investment, class of investment,
acceptable risk and any other factor as required by law.
(d) Permissible investments.
(1) Trust funds may be invested without limitation in the following asset classes:
a. Bonds, notes, mortgage-backed securities, or other obligations of the
United States or those guaranteed by the United States or any agency of the
United States Government or instrumentality of the United States Government or
for which the credit of the United States Government, government agency or
instrumentality is pledged for the payment of the principal and interest or
dividends thereof.
b. Certificates of deposit of any bank incorporated under the laws of the
State of Florida, or any national bank organized under the laws of the United
States, to do business and situated in this state, to the extent that such savings
accounts are fully insured with the federal government or an agency thereof, and
that the certificates of deposit are secured by the Deposit of Securities of the
United States Government.
C. Repurchase agreements with United States Treasury Securities, and
agencies of the United States Government as collateral, said collateral to be held
by trustees.
(2) No more than seven percent of the fund at market value may be invested in any
one entity of the categories listed below:
a. Common stock, preferred stock and interest-bearing obligations of
corporations having an option to convert into common stock, domestic or foreign,
when recognized on a major United States stock exchange; provided that the
aggregate investment of the fund in any one issuing corporation shall not exceed
three percent of the outstanding capital stock of that corporation.
b. Notes secured by first mortgages on real property, insured or guaranteed
by the Federal Housing Administration or the Veteran's Administration.
C. Interest-bearing obligations with a fixed maturity of any corporation within
the United States; provided that such obligations are rated by at least two
nationally recognized rating services in any one of the four highest classifications
approved by the comptroller of the currency for the investment of funds of national
banks, or if only one nationally recognized rating service shall rate such
obligations, such rating service must have rated such obligations in any one of the
three highest classifications mentioned in this section. Any security downgraded
subsequent to purchase which results in the security falling below the
recommended guidelines may be held at the investment manager's discretion.
d. Mortgages, excluding those backed by the United States Government or
Government agencies and instrumentalities, which are a commercial property
secured by a first lien mortgage note for up to, but not in excess of, 80 percent of
the appraised value of the property.
e. Common stock and preferred stock of foreign corporations; provided that
the overall investment under this paragraph shall not exceed fifteen percent of the
market value of the total trust fund.
(e) Limitations on investment.
(1) Trust funds may not specifically be invested in private placements or debt to
equity exchanges.
(2) Within the limitations in this section, the board shall have the authority to acquire
every kind of property and investment which persons of prudence, discretion and
intelligence acquire for their own accounts. The board may retain property properly
acquired without limitation as to time and without regard to its suitability for its original
purchase.
(f) Money managers.
(1) The board of trustees shall retain one or more money managers for management
of the assets held by the Plan, and the board shall convey property of the trust to such
managers for investment and reinvestment in accordance with the provisions of this
section.
(2) All money managers shall have a written contract with the board specifying the
assets to be invested; the asset classes appropriate for utilization; expected performance;
standard of care and resolution of disputes. All such contracts shall be governed in
accordance with the laws of the State of Florida and shall have venue for resolution of
disputes in Miami -Dade County, Florida. In the event that any money manager shall
invest assets of the Plan in a prohibited category of investment or shall otherwise breach
the terms of the investment management agreement, if such breach causes a loss to the
trust, the contract shall require the money manager to make the trust whole for any losses
incurred. Each money manager shall be a fiduciary of the Plan.
(3) The board shall establish written guidelines and objectives against which the
investment performance of any money manager retained by the board shall be measured.
If a money manager fails to meet the guidelines and objectives, or fails to meet its
contractual agreement with the board, the money manager may be terminated by the
board. The performance of the investment portfolio for the Plan shall be not less than 90
percent of the median performance of comparable portfolios as determined jointly by the
board and the city manager. If performance falls below that minimum standard, the
money managers shall automatically be removed, unless, based on extenuating
circumstances, the board recommends continuation and such continuation is approved by
the city commission. The board retains the right, at all times, to terminate any money
manager agreement, with or without cause.
(4) In the conduct of their affairs, all money managers shall exercise the judgment
and care under the circumstances then prevailing, which persons of prudence, discretion
and intelligence exercise in the management of their own affairs, not in regard to
speculation, but in regard to the permanent disposition of their funds, considering the
probable income, as well as the probable safety of their capital. Money managers shall
disburse cash or property from the fund to the board upon written request. Such written
request shall constitute a certification that the distribution so requested is one that the
board is authorized to direct and the money manager should not be required to
investigate the application of such money by the board or its designee. No distribution
under this section may cause any part of the fund to be used for, or diverted for, a
purpose other than providing benefits to members and beneficiaries of the Plan and
defraying the reasonable expenses of administering the Plan.
(5) The board shall have a continuing duty to observe and evaluate the performance
of any money manager or other investment advisor retained by the board. The board
may, as part of its continuing duty to evaluate the performance of its money managers,
retain the services of a performance monitor who shall be responsible for determining the
appropriate performance benchmarks and for advising the board of needed changes in its
investment policy or asset allocation. Any such advisor shall constitute a fiduciary of the
Plan.
(g) Records to be maintained.
(1) Any money manager or investment advisor who has custody or control of any
trust property or who is otherwise employed, directly or indirectly, in the management of
Plan assets shall keep accurate and detailed accounts of all such activities, which records
shall be open to inspection and audit at all reasonable times by the city, the retirement
board, or their designees.
(2) The board shall keep accurate and detailed accounts of its assets and
investments and all such records shall be open for inspection and audit at all reasonable
times by the city, or its designees.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13154, § 1, 4-22-10)
• Sec. 40-246. - Contributions.
(a) Member contributions.
(1) Effective October 1, 2010, regular contributions of each member of the Plan shall
be made each pay period at the rate of 13 percent of each member's earnable
compensation. Effective the first full pay period following October 1, 2012, regular
contributions of each member of the Plan shall be made each pay period at the rate of ten
percent of each member's earnable compensation.
(2) The city shall pick up, rather than deduct, all regular contributions of members.
The city shall derive pickup amounts from the same source of funds which is used in
compensating members of the Plan and shall do so by reducing the earnable
compensation of each member. All pick up amounts shall be treated as employer
contributions for the purposes of determining tax treatment under the Internal Revenue
Code of 1954, as amended.
(3) The board shall certify to the appropriate city authority or officer responsible for
making up the payroll for members of the Plan, the proper proportion of each member's
earnable compensation which shall be picked up each pay period as well as any
additional amounts which shall be deducted for any member. In determining the amount
earnable by a member in each pay period, the board may consider the rate of annual
compensation payable to such member on the first day of each period as continuing
throughout such period, and the board may omit pickup of amounts from earnable
compensation for any period less than a full period. To facilitate pickup of contributions,
the required contributions may be modified by such an amount as shall not exceed one-
tenth of one percent of the annual earnable compensation which is the basis upon which
such pick up amount is to be made.
(4) The proper authority or officer responsible for making up the payroll for members
of the Plan shall certify to the board, on each payroll, the amounts to be deducted or
picked up by the city for each member. Such amounts shall be deducted or picked up by
the city, and when deducted or picked up, shall be paid to the Plan and credited to the
active membership account for each respective member.
(5) Regular contributions shall be made, notwithstanding the fact that the minimum
compensation provided for by law for any member shall be reduced thereby. Every
member shall be deemed to consent and agree to the pick up of regular contributions
provided for herein, and payment of compensation less such contributions shall be a full
and complete discharge of all claims and demands whatsoever for service rendered
during the period of employment covered by such payment, except as to benefits
otherwise provided by this division.
(b) City contributions. The city's annual fiscal contribution to the Plan shall provide for the
following: (1) noninvestment expenses of the Plan; (2) amortization of the unfunded liability of the
Plan; and (3) normal costs of the Plan.
(1) The city's contribution for noninvestment expenses of the Plan in any given fiscal
year shall be determined by the same process the city uses for that fiscal year in
determining the budget of the downtown development authority and the department of
offstreet parking.
(2) The city's contribution for the unfunded liability of the Plan shall be made in
accordance with the final judgment, as amended, in the matter of Gates v. City of
Miami, Case No. 77-9491, in the circuit court for the eleventh judicial circuit in and for
Miami -Dade County, Florida, and in accordance with the following additional provisions:
a. As of October 1, 2011, the unfunded actuarial accrued liability shall be
amortized as a level percentage of the projected payroll of active plan members.
The unfunded actuarial accrued liability as of October 1, 2011 shall be amortized
by adding five years to the remaining years of each unfunded actuarial accrued
liability base. As of October 1, 2011, benefit improvements for actives shall be
amortized over 20 years. Benefit improvements for retirees shall be amortized
over 15 years. Actuarial gains and losses shall be amortized over 20 years.
Changes in actuarial assumptions and methods shall be amortized over 20 years.
b. To the extent the actuarial liability plus normal cost is less than the
actuarial asset value, all prior amortization bases are considered fully funded.
(3) The actuarial method for evaluating assets shall be changed to a moving market
value average over five years beginning September 30, 2008. As of October 1, 2008,
one-year moving average shall be used; as of October 1, 2009, a two-year moving
average shall be used; as of October 1, 2010, a three-year moving average shall be
used, as of October 1, 2011, a four-year moving average shall be used, and thereafter, a
five-year moving average shall be used. Each year, starting with the market value as of
October 1, 2007, the expected return will be determined based on the beginning of year
market value and actual contributions and benefit payments at the assumed interest
assumption. One-fifth of the difference between the expected market value return and the
actual market value return is included in the actuarial asset value at the valuation date.
Four-fifths of the difference between the expected market value return and the actual
market value return is deferred in even increments of 20 percent per year to each of the
next four years as future adjustments to the actuarial asset value. The preliminary
actuarial asset value will be the sum of the actuarial asset value as of the previous
valuation date plus the actual contributions and benefit payments in the year ending on
the current valuation date plus the expected return on market value return plus one-fifth of
the cumulative differences between the expected and actual market value returns over
the five years up to the valuation date. The result cannot be greater than 120 percent of
market value or less than 80 percent of market value.
(4) The individual entry age normal cost method will be applied for costs as of
October 1, 2008, and each October 1 st thereafter, based on demographic and asset data
as of the previous October 1 st adjusted for interest from that date to reflect payment
timing. The annual normal cost will be determined on the individual entry age normal
method. If the actuarial asset value exceeds the individual entry age accrued liability,
such excess shall be held as a reserve to offset any future unfunded actuarial accrued
liability. Under no circumstances will the total cost be determined to be less than zero.
The calculation for normal costs shall be performed separately by
actuaries for the city and for the Plan in accordance with the provisions of
the foregoing paragraph. The actuary for the Plan shall use the actuarial
assumptions adopted by the board. The actuary for the city may use any
actuarial assumptions deemed appropriate by that actuary. If the actuary
for the Plan and the actuary for the city agree on the normal costs
contribution to be made by the city, that amount shall be contributed by
the city. If the two actuaries cannot agree on the normal costs contribution,
they shall promptly select an independent third actuary. If they are unable
to agree on a third actuary, one shall be selected by the American
Academy of Actuaries or Conference of Consulting Actuaries. The third
actuary shall, as soon as practicable, submit to the board and the
commission a funding recommendation utilizing standard acceptable
funding techniques and assumptions. Thereafter, the commission shall
fund the amount recommended by either the actuary for the Plan or for the
city, whichever recommendation is closer to the recommendation of the
third actuary.
(5) On or before May 15 of each year, the board shall certify to the city manager:
a. The amount of appropriation necessary to pay the normal costs and
unfunded liability contributions to the Plan for the next fiscal year, including the
amount of any benefits payable on account of any predecessor pension or
retirement fund; and
b. The amount of appropriation required to pay the noninvestment expenses
of the Plan for the next fiscal year.
(6) On or before May 15 of each year, the director of finance shall certify to the
appropriate fiscal officer of the Miami -Dade County Government, the amount payable by
such metropolitan government under the provisions of Act 59-203 of the General Laws of
Florida. Such amount shall consist of that proportion of the appropriation certified by the
board pursuant to paragraph (4) of this subsection as the total earnable compensation of
members who are employees of such metropolitan government bears to the total
earnable compensation of all members. Upon receipt of such amount from the Miami -
Dade County Government, the director of finance shall cause the amount received, less
that proportion included for noninvestment expenses, to be paid into the benefit account,
and such amount shall be included in the total appropriation payable by the city to the
Plan as required by this section.
(7) All contributions made by the city to the Plan for any given fiscal year shall be
made quarterly, in equal payments, on the first day of each quarter during the fiscal year
in question. If the amount of the city's contribution for normal costs has not been
determined by the initial payment date in any given fiscal year, the city shall make
quarterly payments based upon the greater of (a) the prior year's contribution to normal
costs, or (b) the amount calculated pursuant to the final judgment in Gates v. City of
Miami, as amended.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13090, § 2, 9-24-09; Ord. No. 13101, § 1, 9-29-09; Ord.
No. 13203, § 2, 9-27-10; Ord. No. 13343, § 1, 9-27-12)
• Sec. 40-247. - Accounts.
(a) Generally. There shall be two accounts within the Plan; the membership account and the
benefits account. Each account shall be operated in accordance with the provisions of this
section.
(b) Membership account.
(1) The membership account shall consist of the accumulated contributions of the
members of the Plan and the accumulated contributions of each member absent from
service. The membership account shall also include regular interest paid on member
contributions in accordance with the provisions of this section.
(2) All withdrawals of accumulated contributions, whether made at the request
of a member or paid to a legal representative or designated beneficiary of a deceased
member, shall be charged to the membership account.
(3) Upon the retirement of a member, or upon a member's election of a vested right
to retirement, an amount equal to the member's accumulated contributions shall be
transferred from the membership account to the benefit account.
(c) Benefit account.
(1) The benefit account shall consist of all accumulated contributions transferred from
the membership account, all city contributions, all interest and dividends earned on fund
assets, all reserves for payment of Plan benefits and all other assets of the fund.
(2) On January 1 of each year, the board shall transfer from the benefit account to
the membership account, an amount sufficient to allow regular interest on the individual
balances in the membership account.
(3) All expenses of the Plan shall be chargeable to the benefit account. Such
expenses shall include, but are not limited to, payment of all retirement benefits to
beneficiaries of the Miami City General Employees' Retirement Plan, beneficiaries of the
City of Miami General Employees' and Sanitation Employees' Retirement Trust and
retirement allowances to any other persons who retired under the provisions of any
predecessor pension or retirement fund.
(d) The board, by uniform rule, may adopt alternate bookkeeping methodology for the
maintenance of accounts.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-248. - Physical examination; effect of pre-employment conditions.
(a) All employees, as a condition of entry into the Plan, shall agree to submit to a uniform
medical examination, as may be required by the board, for the purpose of determining the
existence of pre-existing medical conditions. In lieu of a board physical, an employee consents to
the board's access for the purposes of this section to any physical performed by the city. No
persons shall be denied entry into the Plan on the basis of any pre-existing medical condition.
(b) In the event that the physical examination described in this section shall determine the
presence of a pre-existing medical condition, said condition shall be reported to the employee
and recorded in the records of the board. Each employee shall acknowledge the receipt of the
medical report and execute a form, as prescribed by the board, indicating knowledge of the pre-
existing condition and an agreement that said condition cannot form the basis of a service -
incurred disability retirement unless it can be shown that the member would have been entitled to
a service -incurred disability retirement allowance on the basis of aggravation of the pre-existing
condition.
(c) In the event that a member believes the medical report is in error, the member may
request a review by the administrator within 30 days of receipt of notice of the physical
examination results. If the administrator's review does not satisfactorily resolve the question of
the pre-existing condition, the member may request a hearing before the board. Failure to
request such a review will not preclude a later challenge on this issue. The board shall prescribe
uniform rules for the conduct of such hearings.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-249. -Membership; members absent from service.
(a) The membership of the Plan shall include all employees as defined in this Plan, except
police officers and firefighters. Membership shall also include an employee who has been absent
from service for less than three years in a period of five consecutive years after last becoming a
member and who has not withdrawn his or her accumulated contributions. The active
membership of this Plan shall not include any member absent from service.
(b) Participation in the Plan is a mandatory condition for all employees except for those
employees who are precluded from participation in the Plan pursuant to section 40-351 and
employees working in the office of an elected official. Employees working in the office of an
elected official have the ability to opt out of participation in the Plan and the city's trust fund as
established by section 40-351. However, if the employee ceases to work in the office of an
elected official but continues employment elsewhere within the city, that employee shall enroll in
the Plan and start contributing to the plan if not otherwise precluded. Acceptance of employment
shall constitute authorization for the city to pick up contributions from compensation of
employees.
(c) Membership in the Plan shall end under the following conditions:
(1) Absence from service due to resignation, termination, budgetary reduction or
layoff for more than three years in any period of five consecutive years after last
becoming a member;
(2) Becoming a member of any other city sponsored Plan;
(3) End of appointment;
(4) Expiration of office;
(5) Death.
When membership ends, all creditable service previously earned becomes void. If
the member again becomes an employee of the city, the employee shall enter the
Plan as a new member with no credit for previous service, unless time is
repurchased as provided in the Plan. Upon becoming a retiree, a member shall be
entitled to those rights earned as of the date of retirement or such benefits as are
specifically made applicable to retirees.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13112, 10-22-09; Ord. No. 13617, § 1, 7-14-16)
• Sec. 40-250. - Reserved.
Editor's note— Ord. No. 13112, adopted Oct. 22, 2009, repealed4§ 0-250 which pertained to
right of certain persons to reject membership and derived from Ord. No. 12111, § 1, adopted Sept.
25, 2001.
0 Sec. 40-251. - Transfer of city employees to Plan.
(a) In the event that a firefighter or police officer of the city who is a member of the City of
Miami Firefighters' and Police Officers' Retirement Trust ("retirement system") is reclassified to a
position other than those positions that are ineligible to participate in the Plan pursuant
to section 40-351 other than firefighter, police officer, the employee shall be automatically
transferred to membership in this Plan. Creditable service earned as a member of the retirement
system shall be deemed creditable service in this Plan.
(b) Outstanding loan balance. Any member of the public trust fund who has an outstanding
loan against his or her public trust fund account balance and who elects to transfer to the Plan
must repay said loan in full prior to transfer to the Plan.
(c) Commencing on the effective date of transfer to the Plan, a member who has transferred
from the retirement system or public trust fund as defined in section 40-250 shall make regular
contributions at the rate required by the Plan. Accumulated contributions credited in the
retirement system or public trust fund as defined in section 40-250 to the account of such
member shall be transferred to the membership account of the Plan and credited to the member
thereunder. There shall be transferred:
The employee/employer contribution account balance held in a public trust fund
on behalf of any section 40-250 defined employee who transfers membership to
the Plan.
(d) If any member of the Plan has transferred from the retirement system or a
250public trust fund and his or her contributions pursuant to membership in the retirement
system or public trust fund cause accumulated contributions at the member's normal retirement
age to exceed the amount such accumulated contributions would have been had the member
been a member of the Plan during his or her entire period of service with the city, such member
shall be entitled to the return of the excess contributions upon retirement or shall have his or her
retirement allowance increased by the actuarial equivalent of the amount by which his or her
contributions exceed the full amount which would have been the member's accumulated
contributions had he or she been a member of the Plan during his or her entire period of service
with the city.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13112, 10-22-09)
• Sec. 40-252. - Creditable service.
(a) Creditable service shall consist of all time spent in service since last becoming a member,
plus any other time for which creditable service is received pursuant to the provisions of this
division.
(b) The board shall determine by administrative rule the amount of service in any year which
is equivalent to a year of membership service. The board may not grant more than one year of
membership service for all service in any calendar year.
(c) The board may adopt rules and regulations to verify membership credit claimed by any
member.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-253. -Dismissal for willful misconduct.
(a) Upon a member's dismissal from employment for willful misconduct associated with the
duties or responsibilities of his or her employment or office with the city, the following shall apply:
(1) All ownership rights, title, and property interest in such member's accumulated
contributions shall immediately vest in the member; and
(2) The dismissed member shall no longer be entitled to receive any benefit
whatsoever under the Plan.
The term "willful misconduct" as used in this section shall mean the
commission of any act which would constitute a forfeitable offense under
Section 112.3173, Florida Statutes.
(b) Should dismissal of an employee for willful misconduct city as defined in this section be
reversed by the city manager or by a court of final jurisdiction, the former employee, if he or she
again becomes a member, may elect to reconvey all ownership rights, titles and interest in his or
her accumulated contributions to the Plan and may elect to payback for time during which the
member was dismissed. Payments made to the Plan pursuant to this paragraph shall be made in
such manner as the board shall, by rule, prescribe.
(c) The board shall, by administrative rule, adopt a due process procedure to implement this
section.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-254. - Paybacks for membership credit.
Members shall have the right to receive membership credit in the Plan in accordance with the
provisions of this section. Each payback provided for in this section shall be independent of any
other payback and may, where appropriate, result in cumulative credits. If a member revokes the
payback election, is terminated, resigns or is otherwise separated from the city before the payback
is completed, the member shall only receive that portion of credited service purchased as of the
date of separation.
(1) Restoration of prior service credit for reemployed members.
a. Reemployed former member may restore previous membership service by
repaying the accumulated contributions withdrawn together with a uniform rate of interest
as determined by the board. This benefit is only available to persons who separated from
prior employment with the city other than by involuntary dismissal.
b. The board shall, by uniform rule, promulgate an election form to be filled out by
employees wishing to exercise this option. The election form shall specify the form of
repayment. All repayments must be completed within five years of the completion of the
election form.
C. To receive full credit for the membership service permitted under this section, the
member must have completed the repayment of all contributions and interest.
d. If the member is separated for more than three years the member shall be eligible
to combine prior and new service for the purpose of Rule of Seventy (70) retirement, but
prior service shall be paid at the benefit rate in effect at the time of the first separation. If
the member is separated less than three years, all service will be combined for benefit
calculation purposes. The member shall again be an active member of the Plan on the
date employment recommences and the member shall make regular contributions to the
Plan at the rate prescribed by ordinance.
e.
All rights under this section must be exercised in accordance with uniform rules adopted by the board.
(2) Credit for continuous service as a nonmember.
a. Any person who is now a member of the Plan who had prior service with the city
as a probationary, full-time temporary, or permanent employee, classified or unclassified,
but who at the time of that service was not a member of the Plan, may purchase up to
four years of that prior nonmembership service. Contributions will be based on the
member's current rate of earnable compensation and the current contribution rate.
Interest shall be charged at a uniform rate as determined by the board.
b. The board shall promulgate a uniform policy for the election and purchase of this
benefit. All purchases of credit under this section must be completed within five years of
the date of election.
C. In the event that a member becomes disabled in the line of duty, contributions
paid under this section shall be refunded with regular interest, at a uniform rate as
determined by the board. Benefits purchased under this section may not be used for
calculating the minimum service necessary to receive an ordinary disability retirement.
(3) Credit for military service.
a. Any member of the Plan whose service with the city is interrupted by military
service shall have all pension rights accorded veterans as provided by state or federal
law.
b. Any member who has served active military duty, but whose service is not
interrupted by that military duty, may purchase up to a maximum of four years for the time
spent in military service under the conditions set forth in this section.
C. To be eligible for the four-year service credit set forth in subsection b., the
member must:
1. Have engaged in wartime service as declared by state or federal statute or
executive order of the President;
2. Military service under honorable conditions;
3. Be vested in this Plan;
4. Complete the election form promulgated by the board within the time limits
set forth by the board within the time limits set forth by uniform rule of the board;
5. Make a contribution to the Plan equal to the member's rate of earnable
compensation at the date membership service first commenced and that the
contribution rate then in effect, together with four percent interest, be
compounded annually.
All such payments must be completed within five years of election to
participate in the benefits of this subsection.
d. If a member becomes disabled in the line of duty, the member shall have the
option of receiving a return of contributions and no military service credit or accepting a
service retirement and completing the purchase of the military service credits by the
payment of the remaining contributions.
e. If a member becomes disabled from causes other than service with the city, the
member shall have the option of receiving a return of contributions and no military service
credit or completing the purchase of the military service credits by payment of the
remaining contributions.
f. Effective January 1, 2007, members who die or become disabled while serving on
active duty military service shall be entitled to the rights of this section even though such
participant was not re-employed by the city as an employee. Members who die or become
disabled while on active duty military service shall be treated as though re-employed as
an employee the day before the member became disabled or died, and then either died a
non -duty death while employed or became disabled from a non -duty disability. Eligibility,
if any, for benefits will then be determined under the Plan provisions.
(4) Credit for maternity/medical leave.
a. No member who takes an unpaid leave of absence for maternity or medical
purposes under the Family Medical Leave Act (FMLA), shall suffer a break in
membership. All unpaid leaves of absence taken pursuant to FMLA shall be treated as
continuous service, regardless of any other limitation on service within this Plan.
b. A member who takes an unpaid leave of absence for maternity or medical leave
may purchase membership credit not to exceed 180 days. If the member requests light
duty employment from the city but is denied such employment, the amount of
membership credit which may be purchased shall increase to 240 days.
C. Election to buyback for membership credit under this subsection shall be available
for 30 days after notification to the member by the board that such buyback is available.
The board shall, by uniform rule, establish procedures for notification of members.
d. Contributions for this benefit shall be made in accordance with uniform rules
established by the board, but payback of all contributions must be completed within one
year. Interest shall be charged at a uniform rate as determined by the board.
Contributions shall be at the member's current rate of compensation and the current rate
of contribution. If a member fails to meet the qualifications of this subsection, all
contributions shall be returned and the member waives the right to membership credit for
this period.
(5) Restoration of service credit for prior continuous service. Any member with prior service with the
city whose membership in the Plan was delayed due to administrative error, either by the board
or the member which resulted in a delay in the commencement of membership shall purchase
said prior continuous service, without limitation. Contributions shall be based on the rate of
compensation and at the contribution rate in effect on the date of the error. No interest shall be
charged if the error was caused by the city or the board. If the error is caused by the member, a
uniform rate of interest shall be charged, as determined by the board. The payback shall be
made in accordance with uniform rules established by the board and payment must be completed
within five years. In the event of a service -connected disability, prior to the completion of the
buyback, the member shall be offered the opportunity of receiving either a return of contributions
paid or the opportunity to complete the buyback through the payment of the additional
contributions. In the event of a refund, contributions shall be refunded without interest. In the
case of a nonservice-connected disability prior to the completion of the buyback, the member
shall be offered the opportunity of receiving either a return of the contributions paid or the
opportunity to complete the payback through the payment of the additional contributions or
reduction of the disability benefit until the contributions are fully paid. In the case of a return of
accumulated contributions, said contributions shall be returned with interest, at a uniform rate as
determined by the board.
(6) Purchase of additional service upon retirement. A member in service who has continuous service
may, at time of retirement, purchase up to a maximum of three whole creditable years of service
based upon the present value as determined by the actuary for the Plan. The purchase of the
service years will be made by utilizing the employee's available leave balance at time of
retirement reduced by any required federal withholding taxes. If the amount of the leave balance
is insufficient to pay the full cost of the three years, the member may make a lump sum purchase
in cash for the difference. The purchase of these years of creditable service shall be based upon
the average final compensation of the member as defined in section 40-241. The hourly rate
applicable to the calculation of the leave balances shall be as specified under the labor
agreement applicable to the employee or, in the case of exempt employees, the appropriate
administrative policy of the city.
(7) Re-employment after an early retirement window. Should any member be reemployed after
leaving on an early retirement window, no enhancement shall apply to benefits earned during the
period of re-employment. All service retirement benefits earned during the period of re-
employment shall not apply to prior service and shall only apply prospectively.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13154, § 1, 4-22-10; Ord. No. 13679, § 1, 5-11-17)
• Sec. 40-255. - Benefits.
(a) Service retirement.
(1) A member in service may elect to retire on a service retirement upon the
attainment of retirement eligibility as defined in this section. An election to retire shall be
made upon a written application, prescribed by the board. Benefits shall be effective on
the date the application is approved in accordance with the administrative rules adopted
by the board.
(2) A member who retires or separates from employment with ten or more years of
service or who has attained eligibility for service retirement, before October 1, 2010 shall
be considered eligible for a service retirement upon attaining the earliest of the following:
a. The completion of ten years of credited service and the attainment of age
55; or
b. Rule of 70 retirement. The completion of a combination of years of
creditable service plus attained age equaling 70 points. To be eligible for this
benefit, the member must have completed not less than ten years of creditable
service.
C. Effective September 1, 2010, and for a period of 30 days thereafter, an
early retirement program shall be implemented in accordance with this section.
Any member with ten or more years of credited service whose age plus years of
credited service equal 64 or more as of September 30, 2010, is eligible to elect to
retire and receive benefits under the service retirement provisions of subsection
(a). Any eligible member who retires under this early retirement program must
submit a request in writing, no later than September 29, 2010, and retire and
separate from City employment no later than September 30, 2010. Members who
retire under this early retirement program may not participate in the Deferred
Retirement Option Plan (DROP) as provided in subsection (1). This section shall
have no further application or effect on and after October 1, 2010.
(3) The service retirement benefit for persons retiring after October 1, 1998, shall be
equal to three percent of the member's average final compensation multiplied by the
number of years of creditable service through September 30, 2010. Effective October 1,
2010, the service retirement benefit for creditable service on and after that date shall be
equal to: for the first 15 years of creditable service, two and one-fourth percent of the
member's average final compensation multiplied by the number of years of creditable
service; for creditable service in excess of 15 years but less than 20 years, two and one-
half percent of the member's average final compensation multiplied by the number of
years of creditable service; and for creditable service in excess of 20 years, two and
three-fourths percent of the member's average final compensation multiplied by the
number of years of creditable service. The service retirement benefit shall be based on a
member's total creditable service and the benefit multiplier in effect at the time the service
is earned, multiplied by average final compensation in effect at the time of retirement or
separation from employment.
(4) A member, other than a member who is eligible for service retirement pursuant to
subsection (2), who retires on or after October 1, 2010 shall be considered eligible for a
service retirement upon attaining the earlier of the following:
a. Completion of ten years of creditable service and the attainment of age
60; or
b. Completion of thirty years of creditable service and the attainment of age
55.
C. Rule of 80 retirement. The completion of a combination of years of
creditable service plus attained age equaling 80 points. To be eligible for this
benefit, the member must have completed not less than 10 years of creditable
service.
(5) Any member eligible for a service retirement may choose any of the optional
allowances provided in subsection 0).
(6) Notwithstanding any other provision of this Plan, any member who is employed
and not participating in the DROP on September 29, 2010 may elect to receive his/her
accrued benefit as of that date, in accordance with the provisions of the Plan in effect on
that date. Such members who elect to receive their accrued benefit as of September 30,
2010, at a date prior to the normal retirement age provided in subsection (4), shall be
eligible to receive that portion of their retirement allowance based on creditable service
on or after October 1, 2010, on the date and in the manner provided by the provisions of
the system in effect on the earlier of retirement or separation from service.
(b) Early service retirement.
(1) Any member who has 20 or more years of creditable service may elect to retire on
a retirement allowance which shall be the actuarial equivalent of the service retirement
allowance otherwise available to the member upon the attainment of the date the member
is eligible for service retirement in accordance with subsections (a)(2) or (a)(4), as
applicable at the date of early service retirement. Such election shall be made upon a
written application prescribed by the board. Benefits shall be effective on the date the
application is approved in accordance with the administrative rules adopted by the board.
(2) A member eligible for early service retirement may choose any of the optional
allowances provided for in subsection (i) of this Plan.
(3) A member who has elected to retire on an early service retirement shall not be
eligible to participate in DROP.
(c) Vested right to retirement.
(1) If a member who is not entitled to retire on either a service retirement or early
service retirement, ceases to be an employee for any reason other than death or willful
misconduct prior to October 1, 2010, the member may elect to continue as a member not
in service and retire upon the subsequent attainment of age 55, or if a member who is not
entitled to retire on either a service retirement or early service retirement, ceases to be an
employee for any reason other than death or willful misconduct on or after October 1,
2010, the member may elect to continue as a member not in service and retire upon
attainment of age 60; provided:
a. That at the time the member ceased to be an employee, the member had
completed ten years of creditable service; and
b. That the member had not withdrawn his or her accumulated contributions.
C. The retirement benefit shall be the same as a service retirement benefit.
(2) If a member who elects to become a member not in service subsequently elects
to withdraw his or her accumulated contributions, the member not in service shall be paid
the amount of his or her accumulated contributions at the time he or she ceased to be an
employee, plus regular interest.
(3) If a member not in service dies prior to retirement, his or her designated
beneficiary shall be paid the amount of his or her accumulated contributions at the time
the member ceased to be an employee, plus regular interest to the date of the member's
death.
(4) If a member elects a vested right to retirement under any city retirement program
and thereafter again becomes an employee more than three years after separation, the
member shall be eligible, before October 1, 2010, to combine prior and new service for
the purpose of Rule of Seventy (70) retirement, but prior service shall be paid at the
benefit rate in effect when vested rights were elected. If the member is separated for less
than three years, all service will be combined for benefit calculation purposes. The
member shall again be an active member of the Plan on the date employment re-
commences and the member shall make regular contributions to the Plan at the rate
prescribed by ordinance. Such member shall be entitled to accrue retirement benefits as
if the member were a new entrant upon the date of subsequent employment, except as
the right to combine service as set forth in this paragraph and, in addition, shall be
entitled to receive a retirement benefit for his or her prior employment as provided in this
paragraph A second period of vesting shall not be required and the member shall be
eligible for all rights available to vested employees. This provision shall also be applied to
reemployed retired members, who have been retired for more than three years.
(5) A member may choose any of the optional allowances provided for in subsection
(j) of this Plan at the time the vested retirement allowance commences.
(6) A member not in service shall not be eligible to participate in DROP.
(d) Ordinary disability retirement.
(1) Any vested member of the Plan who becomes permanently and totally
incapacitated for further performance of duty with the city from a cause other than the
performance of duty shall be eligible for an ordinary disability retirement.
(2) A member shall be deemed disabled for the purposes of this section if they are
permanently and totally unable to engage in any useful and efficient service within the city
workforce due to a physical or mental impairment.
(3) No member may receive an ordinary disability retirement on the basis of a pre-
existing medical condition, unless the disability would have occurred regardless of that
pre-existing condition. The board, as part of the disability review process, shall determine
whether a vacant position exists within the city's workforce, consistent with the member's
training, skill and medical limitations. If the member is capable of performing any such
vacant position and the member refuses the assignment, that refusal shall be grounds for
denial of an ordinary disability retirement. Nothing in this section shall require the city to
create a job where none presently exists or to accept an employee who lacks the training
or skills necessary to perform any such vacant position.
(4) Benefits under this section shall commence on the date disability is determined to
exist by the board and shall continue for the life of the member. Benefits shall be paid
monthly and the member shall not be eligible for a return of accumulated contributions or
for any survivorship or other payment option provided under this Plan.
(5) The procedure for determining disability shall be as set forth in this Plan for the
determination of service -incurred disability.
(6) The board of trustees shall have the continuing right to require disabled members
to submit to a medical examination when the board has reason to believe that the
disabled member is committing a fraud on the fund.
(7) Benefits payable under this section shall be the greater of 90 percent of the
product of the benefit multiplier in effect at the time the service is earned multiplied by the
number of years of credited service; or 30 percent of the member's average final
compensation.
(8) Upon finding that a member is no longer disabled as defined in this Plan, ordinary
disability benefits shall cease, and the member shall be eligible for a regular service
retirement as if he had retired on the date his disability retirement benefits commenced.
(9) A DROP member shall not be entitled to receive an ordinary disability retirement.
(e) Accidental disability retirement—Job injury.
(1) A member shall be disabled under the terms of this section if the member has
suffered an injury or illness arising out of performance of service for the city and which
renders the member permanently and totally disabled for useful and efficient service with
the city.
(2) A member shall be deemed permanently and totally disabled when he or she is
totally unable to engage in any useful and efficient service within the city due to a
physical or mental impairment which is the natural and proximate result of an accident,
injury or illness which occurred while in the actual performance of duty; provided,
however, that said accident was without gross negligence on the part of the member.
(3) A member shall be eligible for an accidental disability retirement from the date of
entry into the Plan. Application for disability retirement shall be made on a form
prescribed by the board of trustees. The member shall execute such medical releases as
are necessary to permit the board to review the medical records needed to determine the
question of disability and to discuss said records at a public meeting. Upon receipt of an
application for a disability, the board shall refer the application to its physician for review.
The applicant for a disability shall be required to submit to such medical examinations as
the board appointed physician shall deem necessary. The board appointed physician, and
any referring specialists, shall report their findings to the board. The report shall include a
determination, to the extent reasonably possible, of the origin of the disability, whether
the disability is permanent and whether the disability is total. In making those
determinations, the physician(s) shall be bound by the definition of disability set forth in
this Plan.
(4) Upon receipt of the report of the board's physician(s), the board of trustees shall
schedule a public hearing at which time the board shall review all medical reports,
together with such documentary evidence as the applicant may wish to submit. The board
shall conduct a preliminary determination as to whether the member is permanently and
totally disabled based upon the written documentation presented. If the board does not
grant the application based on the written documentation, it shall inform the applicant in
writing of the reasons for the denial of the application. The member may, within 30 days
of receipt of the board's preliminary denial, request a full evidentiary hearing before the
board. Said hearing will be conducted consistent with the principles of due process and
the rules of evidence generally applicable to administrative proceedings shall apply. The
board shall have the power to issue subpoenas compelling the attendance of witnesses.
At said hearing, the applicant may present such oral and written evidence as the
applicant deems necessary to establish its burden of proof. The board may appoint
special counsel as an advocate to cross-examine witnesses and to offer argument in
opposition to the application. The attorney for the board shall not serve both as advocate
and as advisor to the board in the same proceeding. The applicant and the board shall
have the right to examine and cross-examine all witnesses. The decision of the board
shall be based solely upon the evidence presented and the law applicable to this Plan.
Following the conclusion of the hearing, the board shall render an opinion in writing
setting forth the reasons for the grant or denial of the benefit.
(5) The board may prescribe rules of procedure to implement the provisions of this
Plan relating to the conduct of disability hearings.
(6) No applicant for an accidental disability retirement may receive benefits under this
section if the accident, injury or illness is shown to have occurred due to the gross
negligence on the part of the member. The term "gross negligence" shall be defined as
willful, wanton or malicious conduct on the part of the member demonstrating a total
disregard for human life, safety and property.
(7) Except for disabilities arising from the causes outlined in subsection (f), a member
who is granted accidental disability retirement shall receive a benefit equal to 66 2/3
percent of the member's average final compensation or 66 2/3 of the member's
compensation in the year immediately preceding the member's disability, whichever is
greater. The benefit shall be paid yearly, in monthly installments, for life of the member.
Members receiving a benefit under this section shall not be eligible for a return of
contribution nor for optional allowances provided in this Plan under subsections (h) and
(8) Upon the death of a member who has received an accidental disability the spouse
of the member who was designated by the member on the date of retirement as said
member's spouse shall receive payment of an amount equal to 40 percent of the
member's monthly retirement allowance during the lifetime of the spouse.
(9) The board of trustees shall have the continuing right to require disabled members
to submit to a medical examination when the board has reason to believe that the
disabled member is no longer entitled to receive benefits from the fund. If the examination
reveals the member is no longer entitled to receive disability benefits, the benefits shall
cease and, if vested, the member will be eligible for a regular service retirement as if he
had retired on the date his disability retirement benefits commenced. The board has
discretion to exercise this power as the circumstances warrant.
(10) Any benefits received from this Plan shall be reduced by the amount of workers'
compensation indemnity benefits received by the member to the extent that the sum of
the worker's compensation benefits and the benefits received under this Plan exceeds the
average monthly compensation of the member at the time of disability. The board shall,
by uniform rule, prescribe a procedure for treatment of lump sum workers' compensation
indemnity payments as if they had been received on a monthly basis.
(f) Service -incurred disability retirement—Heart disease, hypertension, tuberculosis.
(1) Any member who becomes totally and permanently incapacitated for duty as a
result of heart disease, hypertension or tuberculosis, shall be presumed to have a
service -incurred disability in the line of duty, unless a physical examination upon entering
the plan revealed that such condition existed at that time or competent substantial
evidence determines that the injury is not the result of a workplace injury. Such person
may be eligible for a service -incurred disability provided that a physician retained by the
board, after a medical examination of such member, certifies that such member is totally
incapacitated for duty. Such person shall receive benefits equal to those paid for an
ordinary disability, with a minimum benefit of 40percent of average final compensation.
Upon the death of a member who has received a service -incurred disability retirement no
future pension benefits will be due to any beneficiary.
(2) A DROP participant shall not be entitled to receive a service incurred disability
retirement.
(g) Ordinary death benefit; post-retirement death benefits.
(1) If a member in service who has completed three or more years of creditable
service, whether or not the member is eligible for normal or early retirement, dies from a
nonduty related cause, a lump sum benefit equal to 50 percent of the member's earnable
compensation for the year immediately preceding death shall be paid, together with the
return of the member's accumulated contributions plus interest. If the member has
completed less than three years of credited service at the time of death, there shall be a
return of contributions with interest only. The benefit shall be paid to any person
nominated in writing by the member. In the absence of a written nomination, or if the
person nominated is deceased or cannot otherwise be located, the member's estate shall
be deemed the nominated beneficiary.
(2) A member in service on October 1, 2010 who is eligible for any form of early or
normal retirement under the terms of this Plan dies prior to retirement from a nonduty
related cause, the member shall be treated as if he or she had retired on the date
preceding death. The member's spouse shall have the option to receive:
a. Forty percent of the member's monthly retirement allowance which would
have been payable at normal retirement date, without actuarial reduction together
with 50 percent of the member's compensation in the year immediately preceding
the member's death; and
b. In the event the monthly retirement allowance provided for in subsection a.
is chosen, and the member has served as city manager, assistant city manager,
city clerk, assistant city clerk, executive secretary of the civil service board, city
physician, city attorney, assistant director of the law department, or as director or
assistant director of any department or office established by the City Charter, or
by ordinance established by the City Charter, for a combined period of at least
three years prior to May 23, 1985, an additional one percent of the member's final
average final compensation multiplied by the number of years of service in that
position, up to a maximum of ten years shall be paid to the surviving spouse.
C. A return of the member's accumulated contributions, with accumulated
interest together with 50 percent of the member's compensation in the year
immediately preceding the member's death. This benefit is payable on behalf of
any member, whether or not there is a surviving spouse. In the absence of a
surviving spouse, the benefit will be paid to the person designated in writing to the
board by the member, or if no such designation exists or the designated
beneficiary has predeceased the member, then the benefit will be payable to the
member's estate; or, in the case of a surviving spouse.
(3) The payments under subsections a. and b. shall be paid yearly in monthly
installments.
(4) If a retired member dies prior to receiving 12 monthly retirement payments and
prior to the effective date of any optional allowance permitted by this Plan, there shall be
a benefit payable in a lump sum equal to the unpaid difference of 12 monthly payments.
This benefit may be paid to any person nominated in writing by the member. In the
absence of a nomination, or if the person nominated has died or is otherwise unavailable,
the member's estate shall be deemed the nominated beneficiary.
(5) A member in service who is eligible for any form of early or normal retirement
under the terms of this Plan dies prior to retirement and on or after October 1, 2010 from
a nonduty related cause, the member shall be treated as if he or she had retired on the
date preceding death. If such member is married at the time of death and has not elected
an optional allowance in accordance with subsection (j), the member will be presumed to
have elected Option 6c, providing for payment of 40 percent of the member's monthly
retirement allowance to the member's spouse during the lifetime of such spouse.
(h) Service -incurred death benefit. If a member in service dies from a cause arising in the line
of duty, other than the gross negligence of the member, there shall be a service -incurred death
benefit equal to one-half of the member's average final compensation, which shall be paid yearly
in monthly installments, together with the member's accumulated contributions plus interest,
which shall be payable in a single sum. This benefit shall only be paid to the following persons in
the order set forth below:
(1) To the spouse of the member until the death of the spouse;
(2) If there is no spouse or if the spouse dies before the youngest child of the
deceased member has attained the age of 18, then to the children of the member under
the age of 18 in equal shares. As each child reaches the age of 18, the shares of the
remaining children shall be adjusted accordingly;
(3) If there are no spouse or children under the age of 18 years living at the time of
the member's death, then payment may be made to the dependent father or dependent
mother for life. The board shall determine, by uniform rule, proof necessary to establish
dependency. If both the dependent father and mother are living, the benefit shall be
shared equally. Upon the death of one, the living dependent parent shall receive the
entire benefit. If there is no spouse, dependent child or dependent parent living at t time
of the member's death, the member's estate shall receive an amount equal to 50 percent
of the member's compensation for the year immediately preceding the member's death,
together with a return of accumulated contributions plus interest.
(i) Return of contributions.
(1) If a member ceases to be an employee, a member may demand a return of
accumulated contributions. Receipt of said contributions shall constitute a full discharge
of all rights under the Plan and any creditable service is waived.
(2) If a member has been granted a retirement benefit, the member shall not be
eligible to receive accumulated contributions unless provided for as an optional allowance
under the terms of this Plan or any other prior Plan of the city.
(j) Normal form of benefit and optional allowances.
(1) Effective September 30, 2010, for members who retire on or after October 1,
2010, the normal form of benefit shall be a life annuity. A member may receive payment
of retirement benefits under the Plan in accordance with the options set forth in this
section, that are actuarially equivalent to the normal form of benefit. The board, by rule,
shall prescribe the method for selecting payment options consistent with the provisions of
this section.
(2) The options permitted under the plan are:
Option 2: Equal payment survivor annuity. A member may receive a
reduced retirement allowance throughout his or her life with an equal sum
being paid to the member's designated beneficiary at the death of the
member. For members who retire before October 1, 2010 and choose this
option for a surviving spouse, the reduction shall be ten percent of the
member's benefit; and if any person other than a surviving spouse is
chosen as the beneficiary, the reduction shall be based on the actuarial
equivalent of the normal form of benefit. For members who retire on or
after October 1, 2010, the reduction shall be based on the actuarially
equivalent sum.
Option 3: One-half payment survivor option. A member may receive a
reduced retirement allowance payable for the life of the member with one-
half of the member's benefit being paid to a designated beneficiary at the
death of the member. For members who retire before October 1, 2010 and
choose this option for a surviving spouse, the reduction shall be two
percent of the member's benefit; and if any person other than a surviving
spouse is chosen as the beneficiary, the reduction shall be based on the
actuarial equivalent of the normal form of benefit. For members who retire
on or after October 1, 2010, the reduction shall be based on the actuarially
equivalent sum.
Option 6a: A member may, in lieu of any other benefit from this Plan,
receive a return of contributions, excluding amounts picked up from the
member's earnable compensation and credited to the COLA fund between
June 23, 1985 and September 30, 1993. Under this option, the member
shall also receive a monthly service allowance equal to one-half of the
amount to which the member would have been entitled under this plan.
This option has no survivorship benefit.
Option 6b: Life annuity. A member who retires on or before October 1,
2010 may receive the normal monthly service retirement allowance plus
an additional five percent payable for the life of the member, with no
survivorship benefit. The payment of this benefit shall be guaranteed for at
least one year.
Option 6c: Surviving spouse annuity. A member who retires before
October 1, 2010 may receive an unreduced retirement payment through
the life of the member and upon the member's death the surviving spouse
shall receive forty percent of the member's retirement allowance payable
during the lifetime of the spouse. Such a member who desires to leave a
greater survivorship percentage to a surviving spouse may elect Options 2
or 3. A member who retires on or after October 1, 2010 may elect to
receive an actuarially reduced retirement payment for the life of the
member and upon the member's death the surviving spouse shall receive
forty percent of the member's retirement allowance payable during the
lifetime of the spouse.
(k) Change in beneficiary. Any member who elects a survivorship option for a spouse
pursuant to subsection (1), may designate a new spousal beneficiary in accordance with
procedures established by the board; provided, that an actuarial valuation will be made following
such election, and the benefit for the retiree will be recalculated so that it is the actuarial
equivalent of the benefit payable to the original spouse. It is intended that the Plan will pay only
one survivor benefit for any member of the Plan and will not incur an increase in benefit costs by
reason of a change in designated beneficiary.
(1) Deferred retirement option program. Effective upon ratification of the A.F.S.C.M.E., Local
1907, labor agreement for October 1, 2001 through September 30, 2004, the DROP of the
retirement plan shall be available for general employees and shall consist of a FORWARD DROP
and a BACDROP. Any general employee who has reached age 55 with ten years of creditable
service, or who has attained a combination of age plus years of creditable service equal to 70,
shall be eligible to participate in the DROP.
(1) Election to participate. Upon election of participation in the DROP, by using forms
and procedures as prescribed by the board of trustees, a member's creditable service,
accrued benefits, and compensation calculation shall be frozen and shall be based on the
member's average final compensation as the basis of calculating the DROP payment.
Upon commencement of participation in the DROP, the member's contribution and the
city contribution to the retirement plan for that member shall cease as the member will be
earning no further service credit. The member shall not acquire additional pension credit
for the purposes of the pension plan but may continue city employment for up to a
maximum of 48 months.
(2) Maximum participation. The maximum period of participation in the DROP, is 48
months. Once the maximum participation has been achieved, the participant must
terminate employment.
(3) Creation of individual account. For each general employee electing participation in
the DROP, an individual account shall be created.
(4) Earnings on DROP account. The board of trustees of the retirement plan shall
establish, by administrative rule, a series of investment vehicles which may be chosen by
participants in the DROP. Any losses incurred on account of the option selected by the
participant shall not be made up by the city or the GESE trust fund, but any such loss
shall be borne by the participant only. Upon participation in the DROP, the member shall
make a selection of the earnings program on forms provided by the board. All interest
shall be credited to the member's DROP account.
(5) Distribution of DROP benefits. Upon conclusion of a period of participation in the
DROP not to exceed the maximum set forth in subsection (2), the participant shall
terminate employment. Upon termination of employment, a participant may receive
payment from the DROP account in the following manner:
a. Lump sum distribution;
b. Periodic payments;
C. Rollover of the balance to another qualified retirement plan, IRA, or an
Internal Revenue Code Section 457 Plan; or
d. An annuity.
A participant may defer payment until the latest date authorized by Section
401(a)(9) of the Internal Revenue Code.
(6) Drop participation shall not affect any other death or disability benefit provided to
a member under federal law, state law, city ordinance, or any rights or benefits under any
applicable collective bargaining agreement.
(7) If a DROP participant dies before the DROP account balances are paid out in full,
the person(s) designated by such DROP participant shall receive such DROP account
balances in accordance with the DROP participant election in effect at the time of death.
(8) Any employee who enters into a DROP agreement shall be bound by the terms
and conditions of that agreement.
(9) Forward DROP. The date of entry into the FORWARD DROP shall be the
beginning of a pay period. Payment shall be made by the retirement plan into the
participant's DROP account in an amount equal to the regular monthly retirement benefit
which the participant would have received had the participant separated from service and
commenced the receipt of benefits from the plan. The amount of the monthly benefit shall
be determined based on the creditable service, average final compensation, and
retirement option selected in accordance with this section. Upon conclusion of a period of
participation in the DROP not to exceed the maximum set forth in subsection (2), the
participant shall terminate employment with the city.
Election of a FORWARD Drop Program precludes participation in a
BACDROP program.
(10) BACDROP. A general employee may elect to BACDROP to a date no further back
than the date of the member's retirement eligibility date. The BACDROP period must be
in 12 -month increments, beginning at the start of a pay period, not to exceed 12 months.
Participation in the BACDROP does not preclude participation in the FORWARD Drop
program.
The benefits for purpose of the BACDROP will then be actuarially
calculated to be the equivalent to the benefit earned at the date of
retirement. Said calculation will consist of the present value of benefits
being equal to the actuarially reduced benefit, plus a lump sum with
interest, as determined by the retirement plan's actuary. Participant
contributions will not be returned for the period of time covered by the
BACDROP program.
The lump sum as calculated by the retirement plan's actuary will be based
on the assumed investment return of the fund without discount for
mortality and deposited into the newly created DROP account.
(11) DROP incentive program. Any member who is a DROP participant as of October
1, 2009, may elect to participate in the DROP incentive program by completing the
necessary election documentation no later than October 15, 2009. Effective October 22,
2009 any member in DROP or eligible to retire, may participate in the extended DROP
incentive program by completing the necessary election documentation no later than
November 6, 2009. Participation in the DROP incentive program and the extended DROP
incentive program is as follows:
a. The DROP incentive program or extended DROP incentive program
participant may, upon separating city employment, elect to either receive:
1. A lump sum in the amount of $25,000.00, or
2. A lump sum in the amount of $7,200.00 and receive a 100 percent
subsidy of insurance for two years from date of separation. The insurance
shall be based on an HMO plan tier of employee plus one.
(12) Reserved.
(13) Reserved.
(14) BACKDROP option. A backdrop benefit option shall be implemented on January
1, 2013. The backdrop option shall replace the existing DROP program. Employees who
have not attained normal retirement eligibility as of January 1, 2013 or were not vested by
October 1, 2010, and all employees hired on or after January 1, 2013, will be eligible for
the backdrop option, but will not be eligible for the DROP. Anyone eligible for the forward
DROP as of January 1, 2013, remains eligible for the forward DROP as it presently exists
and anyone eligible for the forward DROP as of January 1, 2013 or vested prior to
October 1, 2010, who chooses not to enter the forward DROP remains eligible for the
backdrop.
a. An eligible employee who elects the backdrop option shall receive a
monthly benefit payable on the employee's actual retirement date (date of
retirement and separation from city employment) based on the benefit the
employee would have received if he/she had left city employment and retired on
an earlier date after attaining normal retirement eligibility (the "backdrop date"). In
addition, an eligible employee who elects the backdrop option will receive a lump
sum payment equal to the accumulation of monthly retirement benefit payments
he/she would have received during the period following the backdrop date through
the actual retirement date ("backdrop period"), plus interest at the rate of three
percent per year, compounded annually. An eligible employee may elect a
minimum backdrop period of one year and maximum backdrop period of up to
seven years. An eligible employee who elects the backdrop option must select the
normal form of benefit or an optional form of benefit in accordance with
subsection 40-25bo) at the time of electing the backdrop option. The employee's
monthly benefit as well as the lump sum payment under the backdrop option is
based on the form of benefit selected.
b. Employees are eligible to elect the backdrop option after completing one
year of creditable service following the normal retirement date. A backdrop
election must be made within ten years after becoming eligible for normal
retirement. The maximum backdrop period is seven years. Eligible employees
who wish to elect the backdrop option must provide written notification to the
department director and the department of human resources at least eight months
prior to the employee's retirement date; provided a lesser notice period may be
approved by the city manager due to special circumstances. Bargaining unit
members will be eligible to revoke their backdrop election one time, but within one
month of their election. However, if a bargaining unit employee is granted a lesser
notice period by the city manager due to special circumstances, the employee will
not be eligible for the one-time backdrop election revocation. Employees are not
required to elect the backdrop option.
C. All or a portion of the lump sum payment under the backdrop option may
be rolled over to an eligible retirement plan or IRA in accordance with federal law.
d. If the backdrop option is ever terminated, for any reason, the rights of all
persons then in the DROP shall not be diminished or impaired. Additionally, if the
backdrop is ever terminated, all persons who are then eligible for the backdrop
option will still be eligible for a seven year backdrop. The board of trustees of shall
develop operational rules for the implementation of this provision.
(m) Reemployment of retirees. Except as expressly provided herein, should any retiree be
reemployed by the city into a regular, permanent, full-time employment position as defined
in section 40-241, the benefits payable under this Plan shall be suspended during the period of
reemployment. Upon termination of the period of reemployment with the city, benefits shall be
automatically restored, as provided for in this Plan, on the first day of the month following the
termination of reemployment. No additional vesting period shall be required. Effective November
1, 2002, this section shall not apply to city commission and mayoral assistants and secretarial
staff position, as described in Civil Service Rule 1, Sec. 1.2(a), authorized in the city budget for
the offices of the mayor and members of the city commission, or to any employment other than
with the city. Employees in the above job classifications may opt to continue collecting their
pensions during their reemployment, but they may not accrue any further pension service credit.
This section shall not apply to retirees who enter into legal agreement with the city either through
written contracts or otherwise for services not defined as full-time, permanent employees of the
city.
(n) Limitation on benefits. Effective September 30, 2010, for members who retire or separate
from employment on or after October 1, 2010, member retirement allowances shall not exceed
the lesser of 100 percent of the member's average final compensation or an annual retirement
allowance of $100,000.00 as of retirement or DROP entry based on the normal form of benefit in
effect on the date of retirement; provided, in no event shall the benefit limitation provided in this
subsection be less than the lesser of 100 percent of the member's average final compensation or
the member's accrued benefit on September 30, 2010, based on the normal form of benefit in
effect on that date. Effective September 30, 2012, member retirement allowances shall not
exceed an annual retirement allowance of $80,000.00 as of retirement or DROP entry based on
the normal form of benefit in effect on the date of retirement; provided, any employee who has an
accrued benefit in excess of $80,000.00 annually on the effective date shall retain that benefit,
but shall not accrue any additional benefits after that date.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 12185, § 2, 2-14-02; Ord. No. 12202, § 2, 3-27-02; Ord.
No. 12249, § 1, 6-27-02; Ord. No. 12753, § 1, 1-26-06; Ord. No. 13099, § 1, 9-24-09; Ord. No.
13109, § 1, 10-22-09; Ord. No. 13154, § 1, 4-22-10; Ord. No. 13192, § 1, 8-31-10; Ord. No. 13203,
§ 2, 9-27-10; Ord. No. 13343, § 1, 9-27-12)
• Sec. 40-256. - Cost -of -living allowance.
A cost of living (COLA) allowance shall be paid to beneficiaries of the Plan as follows:
(1) Every October 1, there shall be calculated a four percent COLA benefit equal to four
percent of the benefit payable at that time. There shall be a minimum COLA benefit of $54.00 per
year and a maximum COLA benefit increase of $400.00 per year provided the retiree's first
anniversary of retirement has been reached.
(2) Retirees exercising the return of contributions and reduced pension option shall receive a
minimum COLA benefit of $27.00 per year and a maximum COLA benefit of $200.00 per year,
provided the retiree's first anniversary of retirement has been reached.
(3) COLA participation for DROP members. Eligibility for payments for cost of living
adjustment (COLA) shall commence when a member has reached the first anniversary of
retirement. When that occurs, the COLA shall be paid into the member's DROP account in
monthly installments for the Forward DROP until a member has actually separated from
employment from the city and in lump sum to the member's DROP account for the BACDROP
member upon separation from employment. For the purpose of complying with Section H(2)(g) of
the Second Amended Final Judgment in Gates, the employee's "Date of Retirement" shall be the
date Forward DROP is entered or the date to which the member elects to BACDROP.
(4) The board shall administer COLA payments and COLA assets shall be deemed an
integral part of the trust for which separate accounting is not required.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 12202, § 2, 3-27-02)
• Sec. 40-257. - Adjustment in benefits.
Members who belonged to the Miami City General Employees' Retirement Plan, presently known
as the City of Miami General Employees' and Sanitation Employees' Retirement Trust, shall
continue to be subject to the following adjustments in benefits:
Any member who, on or before May 23, 1985, had a vested right to receive an
additional retirement allowance under the provisions of the Miami City General
Employees' Retirement Plan, presently known as the City of Miami General
Employees' and Sanitation Employees Retirement Trust, which benefit was
previously set forth in former section 40-235(A)(3)(a) of this Code (repealed
June 13, 1985), shall be entitled to such additional benefit upon service
retirement, early service retirement or "rule of 75" or "rule of 70" retirement
pursuant to this division. A member shall be deemed to have a vested right if
said member, on or before May 23, 1985, was serving in any of the capacities
enumerated in former section 40-235(A)(3)(a) and thereafter continued to serve
in such capacity uninterruptedly for a total combined period of not less than three
years. Those members having such vested right may only continue to earn credit
for such allowance up to a combined period of ten years' service.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-258. - Assignments and loans prohibited.
The present or future right of a person to moneys in the fund or to a retirement allowance, an
optional allowance, a death benefit, the return of contributions, or any other right accrued or
accruing to any person under the provisions of this division, shall be unassignable, and shall not
be subject to execution, garnishment, attachment, the operation of bankruptcy or insolvency law or
any other process of law whatsoever, except with respect to alimony, child support, or medical
payments to a former spouse. Loans to participants are prohibited.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-259. - Protection against fraud.
Whoever, with intent to deceive, shall make any statements or reports required under this division
which are untrue or shall falsify or permit to be falsified any record of this Plan, shall be punished
as provided in section 1-13 of this Code.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-260. - Errors.
Should any change or error in Plan records be discovered or result in any member or beneficiary
receiving from the Plan more or less than he or she would have been entitled to receive had the
records been correct, the board shall have the power to correct such error and, as far as possible,
adjust the payments in such a manner that the actuarial equivalent of the benefit to which such
member or beneficiary was correctly entitled shall be paid.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-261. - Bonding; fiduciary insurance.
(a) Prior to exercising custody or control of any funds or property of the Plan, every fiduciary
of the Plan and every person who handles funds or other property of the Plan shall be bonded.
Such bond shall provide protection to the Plan against loss by reason of acts of fraud or
dishonesty on the part of the bonded individual, directly or through connivance with others.
(b) The board shall purchase insurance for the Plan and for the members of the board of
trustees to cover liability or losses occurring by reason of an act or omission of a fiduciary,
providing, however, that such insurance permits recourse by the insurer against the fiduciary in
case of a breach of a fiduciary obligation by such fiduciary.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-262. - Compliance with the Internal Revenue Code.
(a) It is the intention of the city and of the board that the Plan remain at all times a qualified
Plan, as that term is defined under the Internal Revenue Code.
(b) No member's annual benefit may exceed the amounts permitted under Section 415 of the
Internal Revenue Code as amended, including cost of living adjustments under Section 415 (d).
(c) Compensation in excess of limitations set forth in section 401(a)(17) of the Internal
Revenue Code shall be disregarded. The limitation on compensation for an eligible employee
shall not be less than the amount which was allowed to be taken into account hereunder as in
effect on July 1, 1993. The Term "eligible employee" means an individual who was a member
before the first plan year beginning on or after January 1, 1996.
(d) In no event may a member's retirement benefit be delayed beyond the later of April
1 -,following the calendar year in which the member attains age 70'/2, or April 1 s, of the year
following the calendar year in which the member retires.
When a distribution of the participant's entire interest is not made in a lump sum, the
distribution will be made in one or more of the following ways: over the life of the participant; over
the life of the participant and designated beneficiary; over a period certain not extending beyond
the life expectancy of the participant; or over a period certain not extending beyond the joint life
and last survivor expectancy of the participant and a designated beneficiary.
(e) If the distribution has commenced before the participant's death, the remaining interest
will be distributed at least as rapidly as under the method of distribution being used as of the date
of the participant's death.
The method of distribution, if the participant dies before distribution is commenced, must
satisfy the following requirements:
(1) Any remaining portion of the participant's interest that is not payable to a
beneficiary designated by the participant will be distributed within five years after the
participant's death;
(2) Any portion of the participant's interest that is payable to a beneficiary designated
by the participant will be distributed either: (i) within five years after the participant's death;
or (ii) over the life of the beneficiary, or over a period certain not extending beyond the life
expectancy of the beneficiary, commencing not later than the end of the calendar year
following the calendar year in which the participant died (or, if a designated beneficiary is
the participant's surviving spouse, commencing not later than the end of the calendar year
following the calendar year in which the participant would have attained age 70-'h).
(f) This subsection 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 subsection, a distributee may elect, at the time and in the manner prescribed
by the Plan administrator, to have any portion of an eligible rollover distribution paid directly to an
eligible retirement plan specified by the distributee in a direct rollover.
(1) For the purposes of this section and section 40-266 of this Plan, the following
words and phrases shall have the meanings indicated:
a. "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:
1. 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;
2. Any distribution to the extent such distribution is required under
Section 401(a)(9) of the Internal Revenue Code; and
3. The portion of any distribution that is not includable in gross
income.
b. "Eligible retirement plan" is an individual retirement account described in
Section 408(a) of the Internal Revenue Code, an individual retirement annuity
described in Section 408(b) of the Internal Revenue Code, a qualified trust, an
annuity plan described in Section 403(a) of the Internal Revenue Code, or an
eligible defined compensation plan described in Section 457(b) of the Internal
Revenue Code which is maintained by an eligible employer described in Section
457(e)(i)(A) of the Internal Revenue Code, or an annuity contract described in
403(b) of the Internal Revenue Code that accepts the distributee's eligible rollover
distribution.
C. "Distributee" includes an employee or former employee. In addition, the
employee's or former employee's surviving spouse is a distributee with regard to
the interest of the spouse. Additionally, "distributee" includes a non -spouse
beneficiary whose rollover options are limited to an individual retirement annuity.
d. "Direct rollover" is a payment by the Plan to the eligible Plan specified by
the distributee.
(g) In the event of a mandatory distribution under this Plan in excess of $1,000.00 and the
member does not elect to receive the distribution directly, then the board shall make a transfer to
an individual retirement plan of the board's choosing and shall notify the members in writing of
such transfer.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 12181, § 1, 1-24-02; Ord. No. 13679, § 1, 5-11-17)
• Sec. 40-263. - Distribution of marital interests in the plan; intervention in legal
proceedings affecting the Plan.
(a) In the event that the board is served with a domestic relations order or other legal process
purporting to require the payment of any portion of a member's benefit to another person as a
result of a dissolution of marriage, the board shall cause such order to be reviewed to determine
compliance with the provisions of the Plan.
(b) The board of trustees shall be authorized to intervene in any such dissolution of marriage
proceeding to ensure that such domestic relations order is otherwise consistent with the
distribution of an interest in a public employees retirement plan under state law.
(c) Any cost associated with the modification or correction of such domestic relations orders
shall be the responsibility of the Plan member.
(d) The board shall be authorized to seek intervention as provided by law in any legal
proceedings which, in the opinion of the board, affects the substantial interests of the Plan.
(e) The parties may consent to the entry of an order distributing benefits in a manner not
otherwise inconsistent with the terms of the Plan.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-264. - General conditions.
(a) The City of Miami General Employees' and Sanitation Employees' Retirement Trust may
sue or be sued as an entity.
(b) The city commission shall have continuing power to amend or supplement this division,
but no amendment shall be adopted which will reduce the then accrued benefits of members or
beneficiaries covered by accumulated reserves, which reserves shall constitute a trust fund for
the payment of such benefits.
(c) There shall be no reversion of trust funds or a return of employer contributions unless all
liabilities have been satisfied.
(d) Upon plan termination or a complete discontinuance of contributions, a member's interest
is non -forfeitable.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13679, § 1, 5-11-17)
• Sec. 40-265. - Excess benefit plan.
(a) The excess retirement benefits above the limits permitted by the Internal Revenue Code
shall be as follows:
(1) Funded from the City of Miami General Fund; and
(2) Paid annually concurrently with the city's annual contribution to normal pension
costs, which shall cause the city to realize a reduction in normal pension costs in the
same amount; and
(3) Be deposited in separate accounts for each respective plan to receive the city's
excess retirement benefit contributions, which accounts shall be separate and apart from
the accounts established to receive the city's normal pension contributions for each
retirement trust;
(b) The board of trustees for General Employees' and Sanitation Employees' (GESE) is
appointed as the committee to administer the Excess Benefit for the GESE retirees.
(c) The actuaries for the GESE Board of Trustees shall calculate the amounts necessary to
fund the defined benefit plans giving effect to the reductions caused by implementation of Section
415 of the Internal Revenue Code.
(d) The excess benefits shall be paid to each eligible member of the Plans on a monthly
basis in an amount equal to the difference between the allowable pension to be paid under the
Internal Revenue Code and the amount of the defined benefit granted eligible members pursuant
to the provisions set forth in the Code.
(e) Should additional retirements occur during the year where the eligible member's
retirement benefit exceeds the Section 415 limits, the GESE Board of Trustees shall calculate the
additional excess benefit amount required for the remainder of the fiscal year and should such
amount exceed the amount available from the funds provided for the fiscal year, the GESE board
of trustees shall notify the city of the additional funds required.
(f) Upon the city's receipt of notice of the additional funds required, the city shall forward the
additional funds required. The requirement for additional funds paid by the city to fund the Excess
Benefit Plan shall be reflected as a reduction in the city's annual contribution of normal pension
costs for the following year.
(Ord. No. 12111, § 1, 9-25-01)
• Sec. 40-266. - Transfer of accumulated leave.
(a) Members eligible to receive accumulated sick leave, accumulated vacation leave or any
other accumulated leave payable upon retirement or separation (including DROP) may elect, not
later than the year prior to retirement to have the leave transferred to the Plan in accordance with
the respective collective -bargaining -agreement, if applicable. Members on whose behalf leave
has been transferred may elect one of the following options within 30 days of
retirement/separation. Members failing to elect a distribution option within 30 days of
retirement/separation will be deemed to have elected Option 1 below:
(1) Receive a lump sum equal to the transferred leave balance, or
(2) Transfer the entire amount of the transferred leave balance directly to any eligible
retirement plan, or
(3) Purchase additional service credit as may permitted by the Code (including
subsection 40-254(6), purchase of additional service upon retirement). If the leave
balance exceeds the cost of the service credit purchased, the balance shall be paid to the
member in a lump sum.
(b) Members who fail to elect a transfer in the year prior to retirement or other separation will
receive payment in a lump sum at time of separation with all attendant tax consequences.
(c) If a member on whose behalf the city makes a transferred leave balance to the Plan dies
after retirement or other separation, but before making an election, as provided, or after making
an election but before any distribution is made, the election option shall be void. In such an
event, any person who would have received a death benefit had the member died in service
immediately prior to the date of retirement or other separation, shall be entitled to receive an
amount equal to the transferred leave balance in a lump sum. In the case of a surviving spouse
or former spouse, an election may be made to transfer the leave balance to an eligible retirement
plan in lieu of the lump sum payment. Failure to make such an election by the surviving spouse
or former spouse within 60 days of the member's death, will be deemed an election to receive a
lump sum payment.
(d) The board, by rule, shall prescribe the method for implementing the provisions of this
section.
(Ord. No. 12111, § 1, 9-25-01; Ord. No. 13154, § 1, 4-22-10)
• Secs. 40-267-40-290. - Reserved.