Effective November 1, 2009, (to be known as the adoption date), the city hereby adopts Benefit Program H for employees hired after May 1, 2004 first hired or rehired or transferred to the division at any time on and after the adoption date, and optional participation for any employee or officer of this municipality otherwise eligible to participate in MERS under Section 2B(3)(a) of the Plan Document who has previously elected to not participate in MERS. Only those employees eligible for MERS membership (Section 2B(3) and 3 of the plan document) shall be eligible to participate.
(A) Hybrid plan contributions.
(1) The DB component shall be exclusively funded by the employer, with no member contributions permitted.
(2) For the DC component, employee and employer contributions shall be required as allowed and specified in plan section 19B(6) and the MERS Uniform Hybrid DC Component Adoption Agreement ("Adoption Agreement," completed and approved and a certified copy submitted to MERS concurrent with and incorporated by reference in this subchapter.) A member is immediately 100% vested in any employee contributions, and is vested in employer contributions under the employer vesting schedule.
(B) Compensation and earnings.
(1) For the DB component, earnings shall include items of "compensation" under Section 2A(6) of the MERS Plan Document, with the exception of the last sentence, which shall not apply.
(2) For the DC component, earnings shall include items of "compensation" under Section 2A(6) of the MERS Plan Document as provided for Benefit Program DC, which equals the Medicare taxable wages as reported by the employer on the member's federal form W-2, wage and tax statement.
(C) Hybrid Plan Vesting.
(1) For the DB component, 6 year vesting is mandatory.
(2) For the DC component, employee and employer contributions shall be required as allowed and specified in plan section 19B(6) and the adoption agreement. A member is immediately 100% vested in any employee contributions, and is vested in employer contributions under the employer vesting schedule.
(3) As provided in Section 19B(16), where a member has previously acquired in the employ of any participating municipality or participating court:
(a) Not less than 1 year of defined benefit service in force with a participating municipality or participating court;
(b) Eligible credited service where the participating municipality or participating court has adopted the Reciprocal Retirement Act, 1961 PA 88; or,
(c) At least 12 months in which employer contributions by a participating municipality or participating court have been made on behalf of the member under benefit program DC.
such service shall be applied toward satisfying the vesting schedule for the DB component, and for the DC component, for employer contributions.
(D) Benefits under hybrid plan; for the DB component.
(1) The Benefit Multiplier (Plan Section 19B(2)) initially selected shall be irrevocable, shall not later be changed and shall be 1.5% times (x) years of service times (x) FAC.
(2) Final Average Compensation (FAC) shall be FAC-3 (Plan Section 19B(4)).
(3) The Benefit shall be payable at age 60 (Plan Section 19B(3)(b)).
(4) Credited Service shall be comprised solely of the sum of (a) the total of the member's credited service under the previous DB program on the effective date of coverage under the Hybrid Plan (Plan Section 19B(14)(b)(ii); see II (E)(b)(ii) below); plus (b) credited service earned by the member after the effective date of coverage under the Hybrid Plan (Plan Section 19B(15)(b)).
(E) Benefits Under Hybrid Plan; for the DC Component (Plan Section 19B(10)). Upon termination of membership, a vested former member or a beneficiary, as applicable, shall elect 1 or a combination of several of the following methods of distribution of the vested former member's or beneficiary's accumulated balance, to the extent allowed by federal law and subject to Plan Section 19B(9)(b) and procedures established by the Retirement Board:
(1) Lump sum distribution to the vested former member or beneficiary.
(2) Lump sum direct rollover to another eligible retirement plan, to the extent allowed by federal law.
(3) Annuity for the life of the vested former member or beneficiary, or optional forms of annuity as determined by the Retirement Board.
(4) No distribution, in which case the accumulated balance shall remain in the retirement system, to the extent allowed by federal law.
(Ord. 091012-1, passed 10-12-2009)