For the purpose of this chapter, the following definitions shall apply unless the context clearly indicates or requires a different meaning.
ACCUMULATED CONTRIBUTIONS. The sum of all amounts credited to a member's individual account in the reserve for employee contributions, including regular interest.
ACTUARIAL EQUIVALENT. Of equal pension reserve (present value). Except as otherwise provided in § 32.15(C), actuarial equivalency shall be computed on the basis of the 1971 Group Annuity Mortality Table, set back no years for males and 5 years for
females, and the interest rate published monthly by the Pension Benefit Guaranty Corporation for use in converting a series of monthly annuity payments into a lump sum value. Section
32.15
(C) prescribes a separate actuarial equivalency rule where a member elects to receive a refund of accumulated contributions (excluding regular interest).
BENEFICIARY. Any person who is being paid or who has entitlement to future payment of a pension or other benefit by the retirement system for a reason other than the person's membership in the retirement system.
BOARD. The Board of Trustees provided in this chapter for the administration and management of the retirement system.
CITY. The City of Marine City, Michigan, and shall include its officers, boards, departments and instrumentalities.
COMMISSION. The City Commission of the city.
COMPENSATION.
(1) The amount of money paid a member for personal service rendered the city while a member of the retirement system. COMPENSATION shall include:
(a) Base salary or wages;
(b) Overtime salary or wages;
(c) Longevity pay;
(d) Pay while absent from work on account of illness, holiday or vacation; and
(e) Worker's compensation benefits, except for medical expenses, during periods the city supplements worker's compensation payments.
(2) COMPENSATION shall not include:
(a) Allowances for clothing, equipment, travel and similar items;
(b) Reimbursement of expenses;
(c) The value of work equipment furnished by the city;
(d) Termination or severance pay;
(e) The value of any fringe benefit unless specifically included;
(f) Payments in consideration of unused holiday and vacation time;
(g) Payments in consideration of unused sick leave; and/or
(h) Any other payment or benefit not specifically included.
(3) (a) Annual compensation in excess of the following amounts shall not be taken into account for any purpose of the retirement system:
1. $200,000 for plan years beginning after June 30, 1989 but before July 1, 1994;
2. $150,000 for plan years beginning after June 30, 1994 but before July 1, 2002; and
3. $200,000 for plan years beginning after June 30, 2002.
(b) The limitations in 1, 2 and 3 above shall be adjusted for cost-of-living in such manner as the Secretary of the Treasury may prescribe pursuant to §401(a)(17) of the United States Internal Revenue Code.
(c) If the period for determining compensation used in calculating a member's accrual for a determination period is less than a full year
(shorter than 12 months), the annual adjusted limitation is an amount equal to the otherwise applicable annual limitation multiplied by a fraction, the numerator of which is the number of months in the short determination period, and the denominator of which is 12. In determining the compensation of a member for purposes of this limitation for plan years beginning before July 1, 1997, the family aggregation rules under § 414(q)(6) of the United States Internal Revenue Code shall apply, except that in applying such rules, the term FAMILY shall include only the spouse of the member and any lineal descendants of the member who have not attained age 19 before the close of the calendar year. If, as a result of the application of such rules, the adjusted limitation is exceeded, then the limitation shall be prorated among the affected individuals in proportion to each such individual's compensation as determined under this section prior to the application of this limitation. Effective for plan years beginning on or after July 1, 1997, the family aggregation rules under § 414(q) of the United States Internal Revenue Code shall not apply in determining a member's compensation for purposes of this limitation.
CONTRACTUAL EMPLOYMENT. Any organization or individual not normally employed by the city who performs services on a fee basis per written agreement.
FINAL AVERAGE COMPENSATION.
(1) For members other than members who are employees of the City Police Department, one fifth of the aggregate amount of compensation paid a member during the period of 5 consecutive years of the member's credited service in which the aggregate amount of compensation paid the member is greatest. The 5 consecutive years of credited service shall be contained within the member's last 10 years of credited service. If a member has less than 5 years of credited service, final average compensation means the aggregate amount of compensation paid the member divided by the member's credited service.
(2) For members who are employees of the City Police Department, final average compensation means:
(a) For any such member who terminates city employment before December 11, 2002, final average compensation means one fifth of the aggregate amount of compensation paid the member during the period of 5 consecutive years of the member's credited service in which the aggregate amount of compensation paid the member is greatest. The 5 consecutive years of credited service shall be contained within the member's last 10 years of credited service. If a member has fewer than 5 years of credited service, final average compensation means the aggregate amount of compensation paid the member divided by the member's credited service.
(b) For any such member who terminates city employment between December 11, 2002 and December 10, 2012, final average compensation means the greater of:
1. Final average compensation as defined in (a) above, or
2. One fifth of the aggregate amount of compensation paid such member during the period of 60 consecutive months of the member's credited service immediately preceding the member's termination of city employment; provided, however, that if a member is absent from work during such 60-month period on account of a city approved leave of absence or a disability related worker's compensation claim, any month or months during which the member was absent for at least 16 days shall be excluded from such 60-month period and replaced by an equal number of non-excluded months of credited service, starting with the first month immediately preceding the beginning of such 60-month period and going chronologically backward to the next preceding month until the total number of months of the member's credited service being counted equals 60. If a member has fewer than 60 months of credited service, final average compensation means the aggregate amount of compensation paid the member divided by the member's credited service.
(c) For any such member who terminates city employment on or after December 11, 2012, final average compensation means final average compensation as defined in (b)2. above.
MEMBER. Any person who is a member of the retirement system.
PENSION. An annual amount paid in monthly installments by the retirement system throughout the future life of a retirant or beneficiary, or for a temporary period, as provided in this chapter.
PENSION RESERVE. The present value of all payments likely to be made on account of a pension. The present value shall be computed on the basis of such mortality and other tables of experience and regular annual compound interest as the actuary appointed by the Board of Trustees shall from time to time determine.
PLAN YEAR. A fiscal year ending June 30, to correspond with the city's fiscal year. Except as otherwise provided in this chapter, the ordinance's books, records, finances, and actuarial valuations shall be maintained on the plan year basis.
REGULAR INTEREST. Such rate or rates of interest per annum, compounded annually, as the Board shall from time to time adopt.
RETIRANT. Any person who is being paid a pension by the retirement system on account of the person's membership in the retirement system.
RETIREMENT SYSTEM or SYSTEM. The City of Marine City Retirement System established by this chapter.
SERVICE. Personal service rendered the city while a member of the retirement system.
WORKER'S COMPENSATION PERIOD. The period for which worker's compensation is paid a retirant or beneficiary on account of disability or death arising out of and in the course of employment by the city, as determined by the Board of Trustees. In no case shall a worker's compensation period include any period from and after attainment of age 60 years. In the event periodic worker's compensation benefits are redeemed or a settlement of a worker's compensation claim is made, WORKER'S COMPENSATION PERIOD means the period, if any, during which periodic worker's compensation benefits are paid plus the period obtained by dividing the redemption or
settlement by the applicable worker's compensation periodic benefit, as determined by the Board of Trustees. Payments in consideration of medical expenses shall be disregarded in the determination of worker's compensation period.
(Ord. passed 11-20-1980; Am. Ord. 00-04, passed 5-4-2000; Am. Ord. 02-01, passed 6-27-2002; Am. Ord. 02-02, passed 6-30-2002; Am. Ord. 03-01, passed 2-6-2003; Am. Ord. 09-01, passed 2-5-2009)