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(a) Council Authority. The Council may by ordinance adopted in accordance with the provisions of this section establish a voluntary Public Service Purchase (PSP) program to allow members to purchase service credit with the Fire and Police Pension Plan (the Plan) for prior full-time service with other public agencies that may include military service. The authority granted in this section shall include the authority to determine which members may participate in the program and specify what public service is eligible for purchase, to establish eligibility requirements and benefit limitations, to conduct periodic review of the costs and usefulness of the program for recruitment and retention purposes, and to terminate or make changes to the program. The authority granted in this section shall include the authority to make necessary modifications to requirements of other Charter and Los Angeles Administrative Code provisions of the Plan for the specific and limited purpose of implementing a PSP program.
(b) Limitations of the PSP Program. The authority given to the Council to establish a PSP program is specifically limited as follows:
(1) The PSP Program Shall Be Cost Neutral. The member shall be required to pay the full actuarial cost of the service credit to be purchased as determined by the Plan's actuary based upon the additional benefits available from the Plan as a result of the purchase. The City shall conduct periodic reviews of the PSP program to ensure the program is cost neutral to the City insofar as the additional benefits provided by the Plan are concerned, without regard to incidental administrative expenses incurred by the Plan.
(2) Limitations on Service Purchases. A member may only purchase full-time service with eligible public agencies. A member may purchase full-time service with a branch of the United States military service only if the member was honorably discharged. Full-time service with any bona fide police agency or fire suppression agency may be purchased only if the member was not terminated for cause. A member may not purchase service for which the member is eligible, or may become eligible, to receive a retirement benefit from another entity unless federal law requires otherwise.
(3) Restrictions Applicable to Purchased Service. Purchased service shall be included in a member's years of service for purposes of calculating the amount of the member's service pension, but shall not be included in years of service for purposes of establishing eligibility for service retirement. Purchased service may be used to qualify for other retirement benefits that are dependent on years of service, such as the Deferred Retirement Option Plan (DROP) or health premium subsidies or reimbursements payable after retirement, if authorized by ordinance and the member has paid the full actuarial costs to cover these additional benefits.
(4) Refund of PSP Program Payments. In the event a member terminates employment, all payments made by the member under the PSP program, including interest accruing on the payments, shall be refunded to the member upon request. If a member dies and contributions become payable from the Plan upon his or her death, all payments made by the member under the PSP program, including interest accruing on the payments, shall be considered contributions of the member and shall be paid accordingly.
(5) PSP Program May Be Modified or Terminated. If the Council determines that the PSP program is not cost neutral and/or that the program is not useful for recruitment or retention, the PSP program may be modified or terminated by the Council by ordinance provided that the appropriate employee representatives have received a minimum of sixty days notice prior to Council action. Agreements entered into prior to the PSP program's termination shall be honored based upon the benefits available from the Plan at the time the agreement was executed. If the PSP program is modified by ordinance, existing agreements to purchase service will continue to be honored based upon the benefits available from the Plan at the time the agreement was executed, unless the agreement is modified to encompass different benefits with actuarial costs adjusted accordingly.
(c) Mode of Adoption. Ordinances adopted pursuant to this section shall be adopted in the same manner as provided in Charter Section 1618(b), but the Council shall be advised in writing by an enrolled actuary as to the cost of the proposed program.
SECTION HISTORY
Added by Charter Amendment M, approved March 6, 2007, effective April 4, 2007.
A Retired Plan Member may elect, after retirement, to provide a survivor benefit to a spouse or domestic partner subject to the following:
(a) Member to Pay Full Cost. The Retired Plan Member shall pay the full actuarially determined cost of the survivor benefit through an actuarial reduction in his or her monthly pension benefit.
(b) Vesting Requirement. The right to benefits under this program shall not vest until the Retired Plan Member survives at least one year from the date he or she makes an election to provide this benefit, unless the Board shall determine by a preponderance of the evidence that the Retired Plan Member's death was accidental.
If the right to benefits has not vested before the date of the Retired Plan Member's death and the accidental death exception does not apply, then no survivor benefit shall be provided by the Plan and the amount by which the Retired Plan Member's monthly benefits were reduced after making this election shall be paid as a lump sum to the spouse or domestic partner, provided that if the spouse or domestic partner has predeceased the member, the lump sum shall be paid to the member's estate.
(c) Only One Election Allowed. In order to minimize administrative costs to the Plan, a Retired Plan Member may only exercise this election once. The Retired Plan Member's election shall not apply to any interest in his or her pension benefit awarded by the court to another person, but only to the interest retained by the Retired Plan Member. The election may only be made to provide a benefit for a spouse or domestic partner who is not already qualified to receive a benefit from the Plan upon the Retired Plan Member's death. For purposes of this section, a domestic partnership must either be filed with the Plan or the California Secretary of State or be recognized as a valid domestic partnership in this state based upon the provisions of Section 299.2 of the Family Code or any successor provisions.
(d) Irrevocable Election. Once an election is made, it is irrevocable. The Retired Plan Member's monthly pension benefits will be permanently reduced and will not increase if the spouse or domestic partner predeceases the Retired Plan Member or if their marriage or domestic partnership is otherwise terminated.
(e) Survivor Benefit. The benefit authorized by this section consists of a percentage continuation of the Retired Plan Member's monthly pension benefit payable to the surviving spouse or domestic partner of the Retired Plan Member for the survivor's lifetime. In order to be eligible to receive the survivor benefit provided by this section, the survivor must be either the spouse or domestic partner of the Retired Plan Member at the time he or she elected to provide this benefit and at the time of his or her death. A survivor receiving a benefit under this section shall not be eligible for a health subsidy from the Plan. The payment of a survivor benefit provided by this section does not impact the payment of other survivor benefits from the Plan.
(f) Payment Options. The Retired Plan Member shall select the percentage of continuance that he or she desires to fund from the options provided by the Plan. These options shall be established by Board rule and shall provide a reasonable range of choices, subject to any limitations imposed by federal law. If no continuance is payable based on the provisions of sub-section (b), then the amount paid by the Retired Member as a reduction in his or her monthly retirement benefit shall be refunded as provided therein.
(g) Right to Review, Modify and Terminate the Program. The City's right to review the program, as provided below, may not be exercised until the program has been operative for at least five years and may not be exercised more often than every five years.
To initiate a review, the City Administrative Officer (CAO) shall request the Plan to provide data relevant to the program's costs. If the CAO so requests after reviewing the data provided, an actuarial report shall be obtained. As part of this review, the City Council shall have the authority, by ordinance, to enact modifications to the program necessary to maintain cost neutrality or to terminate the program if the program cannot be modified to maintain cost neutrality.
If the program is modified, the modifications shall not apply to Retired Plan Members who elected this benefit before the effective date of the modifications. If the program is terminated, the Plan shall continue to administer the program for all Retired Plan Members who elected benefits under the program prior to the termination date, but shall not allow Retired Plan Members to elect benefits under the program after the termination date.
(h) Board's Authority to Adopt Rules and Administer the Program. The Board shall administer this program and adopt any necessary rules. This includes the authority to establish any mortality assumptions required for the administration of the program.
SECTION HISTORY
Added by Charter Amendment D, approved March 3, 2009, effective April 1, 2009.
(a) Applicability. The modifications set forth in this section are operative May 1, 2009 and apply to disabled persons receiving Dependent Child benefits provided under any tier.
(b) Elimination of the Marriage Penalty. No person shall be disqualified as a Dependent Child due to the fact that the person is married, was previously married, or subsequently marries. This provision shall apply to all persons who are Dependent Children on the operative date of this section and to all applications for Dependent Child benefits on or after this date. The benefits payable for any Dependent Child who was previously disqualified due to his or her marriage may, on request, be reinstated as of this operative date.
(c) Elimination of the Adoption Penalty. No person shall be disqualified as a Dependent Child due to the fact that the person has been adopted by a person of the same gender as the Plan Member or Retired Plan Member. This provision shall apply to all persons who are Dependent Children on the operative date of this section and to any applicant for Dependent Child benefits on or after this date. The benefits payable for any Dependent Child who was previously disqualified due to his or her adoption may, on request, be reinstated as of this operative date.
(d) Payment Options For Benefits Belonging to the Dependent Child. The following payment options, as applicable, shall be available under all tiers for Dependent Child benefits that are the property of the Dependent Child, provided that these payment options shall not apply to Dependent Child benefits that, under the provisions of the applicable tier, are the property of the Qualified Survivor:
(1) Upon the Dependent Child's request, benefits may be paid directly to the Dependent Child if the Board is satisfied, based upon such evidence as the Board considers sufficient, that the Dependent Child is an adult who is capable of managing his or her own financial affairs, provided that the Board may terminate direct payment to a Dependent Child upon receipt of evidence that he or she is no longer capable of managing his or her own financial affairs; or
(2) Dependent Child benefits that are the property of a person, who is either a minor or an adult whom the Board has not determined to be capable of managing his or her own financial affairs, shall be paid to the guardian or conservator of the Dependent Child's estate, as applicable, unless the Board authorizes payment to the trustee of a trust as provided below; or
(3) The Board may authorize payment to the trustee of a trust that meets the criteria of 42 U.S.C. Section 1396p(d)(4)(A), (B) or (C), after having determined it is in the best interest of the Dependent Child to do so, based upon the request of:
(A) The Dependent Child or the Dependent Child's agent pursuant to a durable power of attorney, provided that the Dependent Child is an adult with the capacity to manage his or her own financial affairs; or
(B) The parent or grandparent of the Dependent Child, if the Dependent Child does not have a guardian or conservator of his or her estate or person and is either a minor or an adult who is not capable of managing his or her own financial affairs; or
(C) The conservator or guardian of the Dependent Child's estate or, if none, the conservator or guardian of the Dependent Child's person.
(e) Effect on Future Tiers. The provisions of this section shall apply to all new tiers of the Plan that may be enacted in the future, unless expressly provided otherwise.
(f) Board Authority to Adopt Rules. The Board is authorized to adopt any rules necessary to implement these changes.
SECTION HISTORY
Added by Charter Amendment C, approved March 3, 2009, effective April 1, 2009.
The Council may, by ordinance, amend the Fire and Police Pension Plan and the provisions of any and all Tiers of the Plan to incorporate provisions of federal laws and regulations required to maintain the tax-qualified status of the Fire and Police Pension Plan. The Council also may enact ordinances to modify or repeal such provisions. Ordinances adopted pursuant to this section shall be adopted in the manner provided in Charter Section 1618(b). It is the intent of this section to facilitate compliance with the provisions of federal laws affecting the Fire and Police Pension Plan.
SECTION HISTORY
Added by Charter Amendment G § 4, approved March 8, 2011, effective April 8, 2011.
(a) Council Authority. The Council may by ordinance establish an Excess Benefit Plan to supplement the benefits of certain employees under the various Tiers of the Plan to the extent such benefits are reduced by the limitations on benefits imposed by Section 415 of the Internal Revenue Code of 1986 as amended. The terms and conditions of any Excess Benefit Plan adopted under the authority of this section shall be substantially the same as those of the Excess Benefit Plan established in Los Angeles Administrative Code Section 4.2021 for Tier 5. If the Council establishes an Excess Benefit Plan, the Excess Benefit Plan must be established as a "qualified governmental excess benefit arrangement" within the meaning of Section 415(m) of the Internal Revenue Code and, once established, may be amended by the Council by ordinance to comply with the Code requirements to maintain such qualification and status.
(b) Mode of Adoption. Ordinances adopted under this section shall be adopted in the manner provided in Section 1618(b).
SECTION HISTORY
Added by Charter Amendment G § 5, approved March 8, 2011, effective April 8, 2011.
If at any time federal or state law should become preemptive or controlling with respect to the provisions of this Plan or the provisions of any Tier, the Board shall have the power to adopt such rules as may be necessary to comply with such federal or state law. Such rules shall be adopted upon the advice and with the concurrence of the City Attorney.
SECTION HISTORY
Added by Charter Amendment G § 6, approved March 8, 2011, effective April 8, 2011.
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