(a) The Village's methods of paying salaries and providing fringe benefits to all employees of the Village who are members of the Public Employees Retirement System (PERS) or the Police and Firemen's Disability and Pension Fund (the Fund) (hereinafter referred to as "employees") are hereby modified as set forth below, in order to provide for a salary reduction pick-up of employee contributions to PERS or to the Fund, in accordance with Section 414(h)(2) of the Internal Revenue Code of 1986, as amended, and the rulings thereunder.
(b) The total annual salary and salary per pay period for each employee shall be the salary otherwise payable under the applicable contracts and applicable Village policies. Such total annual salary and salary per pay period of each employee shall be payable by the Village in two parts:
(1) Deferred salary; and
(2) Cash salary.
An employee's deferred salary shall be equal to that percentage of said employee's total annual salary or salary per pay period which is required from time to time by PERS or the Fund to be paid by an employee and shall be paid by the Village to PERS or to the Fund on behalf of said employee as a pick-up and in lieu of the PERS or Fund contribution otherwise payable by said employee. An employee's cash salary shall be equal to said employee's total annual salary or salary per pay period, less the amount of the pick-up for said employee, and shall be payable, subject to applicable payroll deductions, to said employee. The Village shall compute and remit its employer contributions to PERS or to the Fund based upon an employee's total annual salary or salary per pay period, including the aforesaid pick-up. The Village's total combined expenditures for such employees' total salaries otherwise payable under their contracts and applicable Village policies (including pick-up amounts), and its employer contributions to PERS or to the Fund, shall not be greater than the amounts the Village would have paid for those items had this provision not been in effect.
(c) The pick-up shall be included in an employee's total annual salary for the purpose of computing daily rate of pay, for determining paid salary adjustments to be made due to absence, or for any similar purpose.
(d) The pick-up by the Village of an employee's contributions to PERS or to the Fund shall be mandatory for each such employee. No such employee shall have the option of choosing to receive the contributed amounts directly instead of having them paid by the Village to PERS or to the Fund.
(e) The Village specifically acknowledges that the contributions, although designated as employee contributions for purposes of PERS and the Fund, are to be paid by the Village in lieu of contributions by its employees.
(f) The Village shall pay to PERS and to the Fund the contributions designated as employee contributions from the same source of funds used in paying the salaries of the employees.
(g) The Village shall fulfill its income tax reporting and withholding responsibilities for each employee in such manner as is required by applicable Federal, State and local laws and regulations as they may exist at the time of such reporting and withholding, it being the Village's understanding that Federal and Ohio income tax laws and regulations presently require the Village to report as an employee's gross income his or her total annual salary, less the amount of the pick- up, that applicable portions of the Federal social security taxes continue to apply to picked-up amounts, and that municipal income tax laws may require the Village to report as an employee's gross income his or her total annual salary, including the amount of the pick-up.
(h) The Clerk of the Village is hereby authorized, empowered and directed to implement all procedures necessary in the administration of the pay of all employees affected by this section to effect the salary reduction pick-up, as of the effective date of this section, of all of the statutorily required contributions to PERS and to the Fund so as to enable the employees to obtain the resulting Federal and Ohio tax deferments and other attendant benefits.
(i) The Clerk of the Village is hereby authorized, empowered and directed to obtain the approval of PERS and the Fund regarding the Village's implementation of the salary reduction pick-up plan and to implement all administrative procedures required by PERS and the Fund.
(j) The Law Director is hereby authorized, empowered and directed to seek the approval of the Internal Revenue Service with respect to the salary reduction pick-up plan.
(k) The salary reduction pick-up plan set forth in this section may be amended from time to time to satisfy any additional requirements which may arise as a result of any future amendment to Section 414(h)(2) of the Internal Revenue Code of 1986, as amended, or any future rulings thereunder.
(l) The portion of the employees' mandatory contributions to be picked up, via salary reduction, by the Village, pursuant to this section, may be changed from time to time by legislation adopted by the Council of the Village.
(m) The effective date of the pick-up plan set forth in this section shall be May 26, 1991.
(Res. 2439. Passed 5-14-91.)