The trustees shall hold all the powers of trustees that are necessary to carry out the purposes of the trust and are generally available to trustees under the laws of the State of Michigan, except as limited by the trust and by federal law and regulations. It is intended that the plan and trust shall be tax exempt and shall qualify under the Internal Revenue Code, particularly § 115, and any amendments of the Code applicable to plans of this type. The trustees shall have the continuing power and duty to propose to the city amendments to this chapter, which amendments will be accomplished by ordinance which will include incorporation into this chapter, to amend the trust to the extent it becomes necessary to qualify said plan and trust under the Internal Revenue Code and to continue the tax exempt status of the trust. The trustees shall take no action nor make any determination inconsistent with any qualification or ruling of the Internal Revenue Service, an arbitrator or the courts with respect to the trust. In the case of amendments to the Internal Revenue Code or changes of regulations by the Internal Revenue Service, the trustees are empowered to take all necessary action authorized by this chapter and federal and state laws and regulations to continue the qualifications of the plan and trust as a qualified plan and trust. The trustees are also authorized to take all necessary action to maintain the plan and trust in compliance with applicable federal and state law. The trustees shall have exclusive responsibility for the investment, management and control of trust assets. In carrying out the purposes of the trust, the trustees shall have the following powers and duties:
(A) The trustees may maintain group life, health, hospitalization, optical and/or dental insurance policies now in force and in effect and available to participants. The city, subject to applicable law, shall have the authority to substitute other comparable or superior policies in lieu thereof upon prior written notification to the trustees. The trustees shall, in order to effectuate the purposes of the trust, be bound by the terms of the plan and trust and shall comply with all applicable laws. In addition to, or in lieu of, polices of insurance obtained through commercial or other companies, the city may, consistent with the laws of the State of Michigan, adopt a self-insurance plan. The present arrangements regarding the providing of benefit coverage by the city through all existing policies between the city and applicable insurance carriers may be continued.
(B) The trustees shall establish a uniform system for the timely transmission of required reports and contributions from the city on behalf of participants. The trustees shall have the right and duty to enforce the performance of all obligations provided for in the trust. The trustees shall immediately notify the city and the trust administrator of a delinquency, mistake or discrepancy in any report or contribution. In a suit or action brought by the trustees commenced pursuant to this section, the party in default agrees to pay all costs and expenses, including reasonable attorneys' fees. Delay by the trustees in bringing this suit to recover delinquent contributions from the city shall not be considered a waiver of any of the rights reserved to the trust.
(C) The trustees shall maintain proper books of accounts and records of administration of the trust, including the minutes of all meetings, and make them available for inspection at the permanent office of the trust during reasonable business hours by the city or any participant covered by the plan and trust. The trustees shall compile and furnish to each individual trustee copies of all records, which they individually or collectively require to properly discharge their duties. The city shall be entitled to receive from the trustees records pertaining to the city's contributions, and any participant shall be entitled to receive records of the trustees relating to the activities of the trust.
(D) The trustees shall make reports to and file such information with the Internal Revenue Service, or any other appropriate public authority as may be required by state or federal law.
(E) The trustees may assign or allocate specific responsibilities or duties among the trustees, or appoint committees for the purpose of overseeing any activity or pursuing or investigating any activity or transactions in which the trustees are interested. The trustee or committee of trustees may be assigned the responsibility to take action without prior approval by the remainder of the Board of Trustees. Any such action taken under such circumstances shall be valid, proper and not a breach of fiduciary responsibility of the trustee or committee so appointed and so acting. The trustees may rely on the report of the individual trustee or committee of trustees who prepared the report or recommended the action, which was undertaken by the full Board of Trustees after receiving the report of the trustee or committee of trustees. No trustee shall be liable for the acts of any trustee or committee of trustees under these circumstances because of any act or omission on the part of the trustee or committee of trustees to whom such responsibilities, obligations or duties have been assigned or allocated, unless he or she participates with the knowledge that such act or omission is a breach of fiduciary responsibility or if he or she has knowledge of a breach by such other fiduciary without making reasonable efforts under the circumstances to remedy the breach.
(F) The trust may cause the trustees, or any person, firm or organization with which it deals who has fiduciary responsibilities under the trust or under that person's, firm's or organization's arrangement with the board of trustees, to be bonded in an amount not less than 10% of the funds handled, but in no event in excess of $500,000, unless an amount over and above that is prescribed by state or federal law. The corporation providing such bond shall meet applicable federal, state and local standards.
(Ord. 08-03, passed 9-4-2008)