Loading...
(a) Creation of Funds. Two entirely separate and distinct funds hereby are created and established for the payment of pension benefits pursuant to this Tier 2, certain other benefits as may be authorized from time to time pursuant to the enabling provisions of Section 1428 of this Tier 2 and for the payment of the administrative expenses of the Fire and Police Pension Plan – Tier 1 and Tier 2, one of which shall be known as the “Fire and Police Tier 2 Service Pension Fund” and the other of which shall be known as the “Fire and Police Tier 2 General Pension Fund.”
The Fire and Police Tier 2 Service Pension Fund shall consist of:
(1) deductions made, pursuant to Section 1420, from the salaries of System Members;
(2) all contributions and donations to the Fire Department or to the Police Department for services by any System Members, except amounts of money donated to provide for any medal or permanent competitive award;
(3) all fines imposed upon System Members for violations of rules and regulations of the respective department in which they are Department Members;
(4) all proceeds from the sale of unclaimed property; and
(5) all interest, earnings and profits resulting from investments of such moneys.
The Fire and Police Tier 2 General Pension Fund shall consist of:
(1) all moneys appropriated to the fund by the Council; and
(2) all interest, earnings and profits resulting from investments of such moneys.
(b) Use of Funds. The moneys in the Fire and Police Tier 2 Service Pension Fund shall be used, other than for the investment thereof, exclusively for the payment of service pensions granted pursuant to Section 1408. The money in the Fire and Police Tier 2 General Pension Fund shall be used, other than for the investment thereof and except as hereinafter in this immediate paragraph specifically provided, exclusively for the payment of all pensions other than service pensions, such benefits as may be provided by ordinance adopted pursuant to the provisions of Section 1428 of this Tier 2 and of all administrative expenses of the Fire and Police Pension Plan Tier 1 and Tier 2 of the Charter.
(c) Transfer of Funds. In the event that the moneys in the Fire and Police Tier 2 Service Pension Fund should be insufficient, at any time, to pay all service pensions, then the Board shall have the power and authority to cause the Controller of the City to transfer to the fund sufficient money from the Fire and Police Tier 2 General Pension Fund. In no other event shall any of the money in either of the funds be commingled with any of the money in the other funds.
(d) General Obligations of City. In the event that the moneys in the Fire and Police Tier 1 Service Pension Fund or in the Fire and Police Tier 1 General Pension Fund should be insufficient, at any time, to pay all pensions or other benefits which are payable therefrom, respectively, then the Board shall have the power and authority to cause the Controller of the City to transfer to either of the funds sufficient moneys from the Fire and Police Tier 2 General Pension Fund. The obligations to pay benefits pursuant to this Tier 2 shall be general obligations of the City.
(a) Reserve Basis. The Tier 2 System shall be maintained on a reserve basis which, for the purposes of this Tier 2, shall mean one which provides for the accumulation and maintenance of the Fire and Police Tier 2 Service Pension Fund and the Fire and Police Tier 2 General Pension Fund which together will at all times be equal to the difference between the present value of the obligations assumed and the present value of the money to be received for paying such obligations, where such present values are estimated in accordance with accepted actuarial methods and on the basis of an assumed rate of interest and the mathematical probabilities of the occurrence of such contingencies as affect both the payment of the assumed obligations and the receipt of moneys with which they are to be paid in accordance with the provisions of Sections 1210(b)(2) and 1420.
(b) Actuarial Valuation. The Board shall secure an actuarial valuation showing the cost of maintaining the System and funds on such reserve basis and, at intervals of not to exceed five years, shall cause to be made an actuarial investigation including, but not limited to, the mortality, service and salary experience of the System Members and other beneficiaries and shall further cause to be made annually an actuarial valuation of the assets and liabilities of the funds. The Board shall retain a competent consulting actuary for the purpose of making the necessary actuarial studies and reports on the required investigations and valuations.
(c) Interest Rate. The Board, from time to time and with the advice of the investment counsel, shall establish an assumed interest rate as in its judgment seems proper in the light of the experience and prospective earnings on the investments of the funds.
(d) Unrealized Profits or Losses. With the advice of the consulting actuary and of the investment counsel, the Board, for the purpose of the actuarial valuations, shall provide by rule for the manner and to the extent to which any unrealized profits or losses in the equity-type investments of the funds shall be taken into account.
(a) Member Contributions Required. Deductions shall be made from the salaries of System Members, and such deductions shall be deposited to the credit of and paid into the Fire and Police Tier 2 Service Pension Fund, but no further deductions shall be made from the salaries of System Members who have completed 30 years of service.
(b) Payroll Deduction. The administrative head of the Fire Department and of the Police Department shall cause to be shown on each and every payroll of such department a deduction equal to the sum of the following items:
(1) 6% of the amount of salary, as shown on each such payroll, of each System Member whose name appears thereon; and
(2) that percentage of the amount of salary, as shown on each such payroll, of each System Member whose name appears thereon, but not to exceed 1%, which shall be equal to ½ of the cost of the cost of living benefits provided in this Tier 2 as shall be determined by the Board upon an actuarial valuation obtained by it pursuant to Section 1418.
The Board, from time to time, shall certify in writing to the administrative head of each such department and to the Controller any change in the deductions to be made pursuant to subsection (b)(2) above, and any such change shall become effective as of the next following July 1.
(c) Transfer of Total Member Contributions. The administrative head of each department shall certify to the Controller on each payroll the amount to be deducted from the salary of each System Member whose name appears thereon, and shall cause to be drawn a payroll check in favor of the Board for the total amount of deductions from the salaries of such System Members as shown on each payroll of such department, and the Board shall deposit the payroll check to the credit of the Fire and Police Tier 2 Service Pension Fund. It shall be the duty of the administrative head of each department to cause to be furnished to the Board a copy of each and every payroll.
(d) Deemed Consent to Payroll Deduction. Each System Member shall be deemed to consent and agree to each deduction as provided herein, and the payment of each payroll check to the System Member shall be a full and complete discharge and acquittance of all claims and demands whatsoever for the services rendered by the System Member during the period covered by each such payroll check, except such claims as the System Member may have to the benefits or payments provided by this Tier 2.
(e) Refund of Member Contributions. Every person who is a System Member on July 1, 1982 shall, upon termination of employment, be entitled to a refund of contributions made by him or her pursuant to the provisions of this section. A person not a System Member on July 1, 1982 and whose employment terminated prior to that date, shall not be entitled to a refund of contributions made by him or her during periods of membership prior to July 1, 1982.
(f) Limitations on Refunds. The refund of contributions shall be subject to the following conditions and limitations:
(1) Contributions Prior to June 30, 1982. Upon termination of employment as a Department Member for any reason except retirement pursuant to the provisions of this Tier 2, a System Member shall be entitled to have refunded to him or her all contributions made by such System Member to the Fire and Police Tier 2 Service Pension Fund on or prior to June 30, 1982, plus 6% interest per annum on such contributions calculated in the same manner as if interest had regularly been credited to the System Member’s contributions, compounded as of the last day of the last pay period of December and to the end of the last pay period preceding the effective date of termination of employment.
(2) Maintenance of Individual Accounts. Starting July 1, 1982, the Board shall maintain an individual account of the contributions of each System Member. Regular interest shall be credited to such individual accounts as of the last day of June and December of each year after July 1, 1982, at such rate as the Board may deem proper in light of the earnings of the funds of the Tier 2 System, exclusive of profits and losses on principal resulting from sales of securities. No such interest shall be credited at any other time. Interest shall be credited to the individual account of a System Member whose employment is terminated for any reason for any period of service between the next preceding last day of June or December and the end of the pay period preceding the date of such termination at the rate at which regular interest was last credited to System Members’ individual accounts.
(3) Election of Refund or Benefits. System Members who elect to receive a refund of contributions, forfeit the right to benefits provided in this Tier 2. After payment of any pension benefit has commenced, the System Member forfeits the right to a refund of his or her contributions. System Members who return to active duty from a disability pension may not thereafter have contributions made by them prior to their retirement on such disability pension refunded. A terminated System Member who had elected to have contributions returned, but who reenters service and again becomes a System Member shall, not withstanding any provision of this Tier 2 to the contrary, not be entitled to credit for years of service previously earned unless he or she shall first have repaid the amount of contributions and interest and an amount calculated as interest which would have been earned between the date of original termination of status as a System Member and the date of reentry into service as a Department Member.
(4) Beneficiary Designation. System Members shall have the right to designate persons who shall be entitled to receive money to which a System Member would otherwise be entitled upon termination of employment, to be payable to such designated person or persons upon the System Member’s death, but no such money shall become payable if any person should be entitled to any other benefit provided in this Tier 2. The Board shall adopt appropriate forms for the designation by System Members of persons who shall be his or her beneficiaries.
(a) Determination of Cost of Living Increase or Decrease. The Board, before May 1, of each year commencing with the year 1967, shall determine the percentage of the annual increase or decrease in the cost of living as of March 1, of that year from March 1, of the preceding year, as shown by the consumer price index published by the Bureau of Labor Statistics for the area in which the City is located. If any such index were not to reflect the cost of living as of a particular March 1, then the index for the closest preceding date which shall have done so shall be used. If there were to be any change in the statistical method or the components which were used in any such index from those which were used in any such index of the preceding year with which a comparison is to be made, then the Board, to the extent possible, shall adjust any such differences therein for the purpose of determining the percentage of increase or decrease in the cost of living.
(b) Adjustments to be Made in Pensions. Commencing as of July 1 of the year in which the Board shall determine the percentage of increase or decrease in the cost of living, the monthly amounts of certain pensions, as hereinafter identified and upon the conditions hereunder stated therefor, shall be increased or decreased by reason of such determined percentage of increase or decrease in the cost of living but not to exceed, however, 2% in any given year. Such determined percentage of increase or decrease in the cost of living, as so limited, shall be applied to the monthly amounts of such pensions which shall be payable prior to the applicable July 1, including any previous percentage of increase or decrease in the cost of living which had been made with respect thereto.
(c) Application of Adjustments. The percentage of increase or decrease in the cost of living first shall be applied to:
(1) Service Pensioners with Less than 25 Years Service. The pension of any Retired Member who shall retire pursuant to Section 1408, with less than 25 years of service, upon the July 1 following the date upon which he would have had 25 years of service if he had not retired prior thereto;
(2) Service Pensioners with at Least 25 Years Service. The pension of any Retired Member who shall retire pursuant to Section 1408, with 25 years of service or more upon the July 1, following the effective date of his pension;
(3) Survivor Pensions of Members with Less Than 26 Years Service. The pension of any Beneficiary or Beneficiaries which shall be granted pursuant to Section 1414(a)(5) and(6), whether by reason of the provisions thereof or of those of Section 1414(b) and (c), including any additional pension amounts payable pursuant to Section 1414(a)(7), following the death, with less than 26 years of service, of a Retired Member who had been retired pursuant to Section 1408 or of a System Member who had become eligible to retire pursuant thereto, upon the July 1, following the date upon which such Retired Member or such System Member, as the case may be, would have had 26 years of service if he, the Retired Member, had not retired prior thereto and had been alive on that date, or if he, the System Member, had been alive on that date; and
(4) Survivor Pensions of Members with at Least 26 Years Service. The pension of any Beneficiary or Beneficiaries which shall be granted pursuant to Section 1414(a)(5) or (6), whether by reason of the provisions thereof or of those of Section 1414(b) or (c), including any additional amounts payable pursuant to Section 1414(a)(7), following the death, with 26 Years of Service or more, of a Retired Member who had been retired pursuant to Section 1408 or of a System Member who had become eligible to retire pursuant thereto, upon the July 1, following the effective date of the pension of such Beneficiary or Beneficiaries.
(5) Certain Survivor Pension Beneficiaries. The pension which shall become payable to any minor child or children or dependent child or children, whenever any qualified surviving spouse or reinstated qualified surviving spouse shall cease to be such, shall commence in the same monthly amount which then would have been payable if such pension had become effective upon the date following the date of death of the System Member or Retired Member and thereafter it shall be adjusted as otherwise provided in this section. The pension which shall become payable to any reinstated qualified surviving spouse, as reinstated pursuant to Section 1414(a)(8), shall commence in the same monthly amount which then would have been payable if she never had ceased to be a qualified surviving spouse and thereafter it shall be adjusted as otherwise provided in this section. The pension which shall become payable to any reinstated dependent parent or parents, as reinstated pursuant to Section 1414(c), shall commence in the same monthly amount which then would have been payable if he or she or each of them never had ceased to be a dependent parent and thereafter it shall be adjusted as otherwise provided in this section.
(6) Limitation on Reductions. The amount of any pension referred to in (1), (2), (3), (4) or (5) of this subsection never shall be reduced, by reason of the application thereto of this section, to an amount less than the amount thereof payable pursuant to the provisions of this Tier 2 other than those of this section.
(d) Carryover of Excess Adjustments. If the percentage of increase or decrease in the cost of living in any year, as determined by the Board, were to exceed 2% as compared with the cost of living as of March 1, of the preceding year, the percentage of increase or decrease in the cost of living in excess of 2% shall be carried over and added to or subtracted from the percentage of increase or decrease in the cost of living in the succeeding year, and such procedure shall be complied with from year to year.
(a) Definitions. Wherever used in this section:
(2) “the July 1 following” shall mean only a July 1 subsequent to May 2, 1969;
(3) “Beneficiary” shall include its plural; and
(4) words with respect to any pension granted or to be granted pursuant to Section 1414 also shall mean and include the words, as used in Section 1422(b)(3), “whether by reason of the provisions thereof or of those of Section 1414(b) and (c), including, any additional pension amounts payable pursuant to Section 1414(a)(7).”
(b) Method. The percentage of increase or decrease in the cost of living thereafter shall be applied pursuant to Section 1422 and the terms and conditions contained in this section:
(1) Disability Pensions. To the pension of any Retired Member, ever granted pursuant to Section 1412, upon the July 1, following the date of his retirement or the effective date of this paragraph of this section, whichever shall be the later; or Section 1412, upon the July 1, following the date he shall have had 25 years of service, the date he would have had 25 years of service if he previously had not retired or the fifth anniversary of the effective date of the pension, whichever shall be the earliest;
(2) Survivor Pensions Based Upon Previously Active Members. To the pension of any Beneficiary ever granted on account of the death of an active System Member who died as a result of any injury received during the performance of his or her duties or from sickness caused by the discharge of such duties, upon the July 1, following the effective date of such Beneficiary’s pension; but if such pension became effective before July 1, 1989, it shall be retroactively adjusted as of July 1, 1989;
(3) Survivor Pensions Based Upon Previously Retired Members. To the pension of any Beneficiary,
(C) ever granted pursuant to Section 1414(a)(4) upon the death of the Retired Member, previously retired pursuant to Section 1412(b), upon the July 1 following the date such member shall have had 26 years of service, the date such member would have had 26 years of service if he previously had not retired and then had been alive, or the fifth anniversary of the effective date of the pension of such member, whichever shall be the earliest; and
(4) Survivor Pensions of Nonservice Connected Death of Members. To the pension of any Beneficiary,
(B) ever granted pursuant to Section 1414(a)(6) upon the death of a Department Member eligible to retire pursuant to Section 1408 and which pension of such Beneficiary is identified in Section 1422(b)(3) or (4), upon the July 1 following the date such member shall have had 26 years of service, the date such member would have had 26 years of service if he then had been alive, or the fifth anniversary of the effective date of the pension of such Beneficiary, whichever shall be the earliest.
(c) Cost of Living Adjustments for Other Pensions. The following provisions, in respects other than those provided for in subsection (b) of this section, hereafter shall be controlling in the application to certain pensions of the percentage of increase or decrease in the cost of living.
(1) Whenever the amount of the pension:
(A) of any Retired Member shall be increased or decreased pursuant to Section 1412(a) or (c), or
(B) of any qualified surviving spouse shall be increased or decreased pursuant to any paragraph of Section 1414(a), the amount of any such increase shall not include the percentage of any increase in the cost of living which previously had been applied to the former amount of the pension; and the amount of any such decrease shall include the percentage of any increase in the cost of living which previously had been applied to it as a portion of the former amount of the pension.
(2) Whenever the pension of any Beneficiary:
(i) if the amount thereof which shall be payable to such Beneficiary were to be more than the amount of the pension which had been payable to such member, shall include the percentage of any increase in the cost of living which had been applied to the pension of such member, or
(ii) if the amount thereof which shall be payable to such Beneficiary were to be less than the amount of the pension which had been payable to such member, shall include that portion of the percentage of any increase in the cost of living which had been applied to the pension of such member which shall be in the same ratio as the amount of the pension which shall be payable to such Beneficiary shall bear to the amount of the pension which had been payable to such member, and the percentage of any increase or decrease in the cost of living in excess of 2% per year which had been carried over for such member as of the date of his death shall be carried over for such Beneficiary if (i) hereof were to be applicable or in the same ratio therein provided in (ii) hereof were to be applicable.
(3) Whenever the pension of any qualified surviving spouse hereafter shall be terminated pursuant to any provisions of Section 1414(a) and the pension thereafter shall become payable on behalf of any minor or dependent child or children of the deceased member, the amount of pension on behalf of such child or children shall include that portion of the percentage of increase in the cost of living which had been applied to the pension of such qualified surviving spouse which shall be in the same ratio as the amount of the pension which shall be payable on behalf of such child or children shall bear to the amount of the pension which had been payable to such qualified surviving spouse, and the percentage of any increase or decrease in the cost of living in excess of 2% per year which had been carried over for such qualified surviving spouse as of the date of the termination of his or her pension shall be carried over on behalf of such child or children in the same ratio hereinabove provided.
(d) Limitation of Reductions. The amount of the pension never shall be reduced, by reason of the application thereto of the provisions of Section 1422 or this section, to an amount less than the amount thereof payable pursuant to provisions of this Tier 2 other than those of Section 1422 and this section. Section 1422 hereafter shall be construed and applied in accordance with this section as to each pension mentioned in this section.
(a) Minimum Tier 2 Pensions. Each pension granted pursuant to this Tier 2, regardless of the type of the pension, which became or becomes effective prior to July 1, 1971 and which, as of June 30, 1971, is in a monthly amount of less than $350 shall be increased, effective July 1, 1971, pursuant to the provisions of subsection (b) and subsection (c) of this section, and shall, if such increase results in a monthly pension amount which is less than $350, be increased to provide for a monthly minimum pension of three hundred fifty dollars ($350). Each pension granted pursuant to this Tier 2, regardless of the type of the pension, which becomes effective on or subsequent to July 1, 1971 shall be in a monthly amount not less than the minimum monthly pension amount provided, as of the effective date of the pension, by this subsection of this section. The monthly amount of each such pension never shall be reduced, by reason of the provisions of Section 1422, Section 1424 or subsection (c) of this section, to a monthly amount less than the minimum monthly pension amount provided by this subsection.
(b) Additional Cost of Living Adjustments. The monthly amount of pension of each Beneficiary which, prior to the effective date of this section, had been increased by reason of a cost of living adjustment thereof pursuant to Section 1422 or Section 1424 shall be increased, as of July 1, 1971, by that portion of the percentage of the annual increase in the cost of living, as had been determined by the Board pursuant to Section 1422 which was in excess of 2% but not in excess of 3% for each year the monthly amount of such pension had been increased.
(c) Adjustment for Certain Pensions. The monthly amount of pension of each Beneficiary who heretofore did qualify or hereafter shall qualify for a cost of living adjustment thereof pursuant to Section 1422 or Section 1424 and the monthly amount of pension of each Beneficiary which shall be the minimum monthly pension amount provided by subsection (a) of this section, hereafter shall be increased or decreased, as of the dates provided therefor by Section 1422, by the percentage of the annual increase or decrease in the cost of living as hereafter shall be determined by the Board pursuant to Section 1422.
(e) Savings Clause. Should any provisions of this section at any time be held to be invalid, in their application to certain persons or periods of time such invalidity shall not affect the validity of any provisions as to other persons entitled to benefits hereunder or the applicability as to other periods of time.
(a) Purpose of this Section. It is the purpose of this section to enable the Council to provide by ordinance a program or programs whereby persons receiving pensions pursuant to the provisions of this Tier 2 may become eligible to have subsidy payments made on their behalf for health insurance, accident insurance, life insurance or health care plan coverage or coverage for any combination of such programs as determined by the Council and subject to such conditions of entitlement as may be set forth in any ordinance adopted in accordance with the provisions of this section.
(b) Mode of Adoption of Ordinance. Ordinances adopted pursuant to this section must be approved by not less than two-thirds of the membership of the Council, subject to the veto of the Mayor and readoption by the Council by three-fourths of the membership of the Council. No such ordinance may be finally adopted by the Council until the expiration of at least thirty days after its first presentation to the Council, nor until after a public hearing has been held thereon. Any ordinance adopted pursuant to this section shall go into effect upon its publication, but the terms of such ordinance, or portions thereof, may be operative at a later date or dates.
(c) Council Authority to Establish Subsidy Limitations. The Council may establish by ordinance the maximum subsidy payments for beneficiaries under any programs established by the Council pursuant to subsection (a), including appropriate limitations for employees receiving subsidies from other City plans.
(d) Administration of Subsidy Program. Any subsidy program adopted by ordinance pursuant to this section shall be administered by the Board. In furtherance thereof, the Board shall have the authority to contract for suitable programs as hereinabove defined in subsection (a) hereof, to be made available to retired members or other beneficiaries, and shall have the power to adopt such rules as it deems necessary to administer such programs. Notwithstanding the foregoing provisions, the Board may authorize the Personnel Department to administer any program or part thereof established by ordinance pursuant to the provisions of this section, provided however, that the Board shall reimburse the General Fund of the City for all necessary expenses incurred by the Personnel Department as a result thereof.
(e) Board Authority to Adjust Subsidy Amount. The Council may by ordinance authorize the Board to increase or decrease subsidy payments pursuant to factors, standards, and limitations prescribed in the ordinance.
SECTION HISTORY
Amended by: Charter Amendment 2, approved March 8, 2005, effective April 6, 2005.
(a) Election. With the enactment of this section an election has been made as authorized under the provisions of Section 415(b)(10)(C) of the Internal Revenue Code to be bound by the limitations of Section 415 of the Code subject to the provisions of Section 415(b) and (B), thereof.
(b) Automatic Repeal. If any of the provisions of Section 415 of the Internal Revenue Code should be repealed, the provisions of this section shall be deemed repealed to the same extent.
Loading...