(a) The full amount of the statutorily required contributions to the Public Employees’ Retirement System (PERS) shall be withheld from the gross pay of each person within any of the classes established in division (b) of this section and shall be “picked up” (assumed and paid to the PERS) by the City. This pick-up by the City is, and shall be designated as, public employee contributions and shall be in lieu of contributions to the PERS by each person within any of the classes established in division (b) of this section. No person subject to this pick-up shall have the option of choosing to receive the statutorily required contribution to the PERS directly instead of having it picked up by the City or of being excluded from the pick-up.
The City shall, in reporting and making remittance to the PERS, report that the public employee’s contribution for each person subject to this pick-up has been made as provided by State statute.
(b) The pick-up by the City provided for in this section shall apply to employees of the City who are or become contributing members of the PERS (“Covered Employees”).
(c) The City’s method of payment of salary to covered employees is hereby modified as follows, in order to provide for a salary reduction pick-up of employee contributions to PERS, as permitted under IRC Section 414(h)(2) and rulings thereunder. The total annual salary and salary per pay period for each covered employee shall be the salary otherwise payable under City policies, ordinances and collective bargaining agreements. Such total annual salary and salary per pay period of each covered employee shall be payable to the City in two parts:
(1) Deferred salary; and
(2) Cash salary.
A covered employee’s deferred salary shall be equal to that percentage of the employee’s total salary which is required from time to time by the PERS to be paid as an employee contribution otherwise payable by that employee. An employee’s cash salary shall be equal to that employee’s total annual salary or salary per pay period less than amount of the pick-up for that employee, and shall be payable, subject to applicable payroll deductions, to that employee. The City shall compute and remit its employer contributions to the PERS based upon an employee's total annual salary or salary per pay period, including the foregoing pick-up. The City's total combined expenditures of the City for covered employees' total salaries, otherwise payable under applicable City policies, ordinances or collective bargaining agreements and the pick-up provisions of this section, shall not be greater than the amounts it would have paid for those items had this pick-up provision not been in effect. In addition to the foregoing, but not as part of the foregoing pick-up program, elected officials of the City shall be reimbursed for their costs of purchasing (or having purchased prior to the effective date of this section) additional service credit under PERS if the purchase is made pursuant to Ohio R.C. 145.201 and is (or was) attributable to service as an elected official of the City, or pursuant to Ohio R.C. 145.30, 145.301 and 145.302; at a time which is (or was) prior to the PERS retirement of the elected official and while the elected official is (or was) in office as an elected official of the City.
(d) For purposes of computing daily rate of pay and paid salary adjustments to be made due to absence, for the purpose of computing the compensation of a covered employee under Ohio R.C. Chapter 145, and for any similar purpose or benefit calculation, the pick-ups provided herein shall not be considered.
(e) The City shall fulfill its income tax reporting and withholding responsibilities for each covered employee in such manner as is required under applicable Federal, State and local laws and regulations as they may exist at the time of such reporting and withholding, it being the City's understanding that Federal and Ohio income tax laws and regulations presently require it to report as an employee's gross income tax his or her total annual salary without regard to any pick-up, while applicable Municipal income tax laws may require it to report as an employee's gross income his or her total annual salary including the amount of the pick-up; and that the amounts picked-up hereunder pursuant to a salary reduction agreement will be subject to applicable Federal employment taxes unless the employee is exempt from the application of such taxes.
(f) The Director of Finance is hereby authorized and directed to implement the provisions of this section. Accordingly, the Director of Finance may make applications to the Internal Revenue Service and the PERS Board to determine their requirements in connection with this pick-up program.
(Ord. 1993-15. Passed 2-18-93; Ord. 2001-43. Passed 5-8-01.)
(g) If any current employee or public official of the City whose employment with the City began prior to 1981, and whose PERS records fail to show credit for regular PERS contributions and whose Finance Department records fail, in the opinion of the Finance Director, to show the reason for the failure by the City to make such contributions, then, in such cases, the Finance Director is hereby authorized to make all back payments, plus penalties and interest, so that such employee or public official is given full PERS credit for the period in which the City failed to make contributions. If the employee pays or has paid such back payments directly to PERS, then the Finance Director is authorized to make payment to such employee or public official upon proof of payment.
(Ord. 1997-64. Passed 5-27-97.)