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(a) Operation of the Pension Fund.
(1) The Board is hereby authorized to hold and supervise the investment of the assets of the Pension Fund, subject, to the provisions of the laws of the Commonwealth of Pennsylvania and of this Plan and any amendment thereto.
(2) The Pension Fund shall be used to pay benefits as provided in the Plan and, to the extent not paid directly by the employer, to pay the expenses of administering the Plan pursuant to authorization by the Board.
(3) The employer intends the Plan to be permanent and for the exclusive benefit of its employees. It expects to make the contributions to the Pension Fund required under the Plan. Except as may be required under State law, the employer shall not be liable in any manner for any insufficiency in the Pension Fund; benefits are payable only from the Pension Fund, and only to the extent that there are monies available therein.
(4) The Pension Fund will consist of all funds held by the Board under the Plan, including contributions made pursuant to the provisions hereof and the investments, reinvestments and proceeds thereof. The Pension Fund shall be held, managed, and administered pursuant to the terms of the Plan. Except as otherwise expressly provided in the Plan, the Board has exclusive authority and discretion to manage the Pension Fund assets. The Board may, however, appoint a trustee, custodian and/or investment manager, at its sole discretion.
(b) Powers and Duties of the Board. With respect to the Pension Fund, the Board shall have the following powers, rights and duties, in addition to those vested in it elsewhere in the Plan or by law, unless such duties are delegated.
(1) To retain in cash so much of the Pension Fund as it deems advisable and to deposit any cash so retained in any bank or similar financial institution (including any such institution which may be appointed to serve as trustee hereunder), and shall include the right to hold funds on a temporary basis in accounts or investments that do not bear interest.
(2) To invest and reinvest the principal and income of the Fund and keep said Fund invested, without distinction between principal and income, in securities which are at the time legal investments for fiduciaries under the Pennsylvania Fiduciaries Investment Act, or as the same may be subsequently modified or amended.
(3) To sell property held in the Fund at either public or private sale for cash or on credit at such times as it may deem appropriate; to exchange such property; to grant options for the purchase or exchange thereof.
(4) To consent to and participate in any plan of reorganization, consolidation, merger, extension or other similar plan affecting property held in the Fund; to consent in any contract, lease, mortgage, purchase, sale or other action by any corporation pursuant to any such plan.
(5) To exercise all conversion and subscription rights pertaining to property held in the Fund.
(6) To exercise all voting rights with respect to property held in the Fund and in connection therewith to grant proxies, discretionary or otherwise.
(7) To place money at any time in a deposit bank deemed to be appropriate for the purposes of this Plan no matter where situated, including in those cases where a bank has been appointed to serve as trustee hereunder, the savings department of it s own commercial bank.
(8) In addition to the foregoing powers, the Board shall also have all of the powers, rights, and privileges conferred upon trustees by the Pennsylvania Fiduciaries Investment Act, or as the same may be subsequently modified or amended, and the power to do all acts, take all proceedings and execute all rights and privileges, although not specifically mentioned herein, as the employer may deem necessary to administer the Pension Fund.
(9) To invest the assets of the Pension Fund in any collective commingled trust fund maintained by a bank or trust company, including any bank or trust company which may act as a trustee hereunder. In this connection, the commingling of the assets of this Plan with assets of other eligible, participating plans through such a medium is hereby specifically authorized. Any assets of the Plan which may be so added to such collective trusts shall be subject to all of the provisions of the applicable declaration of trust, as amended from time to time, which declaration, if required by its terms or by applicable law, is hereby adopted as part of the Plan, to the extent of the participation in such collective or commingled trust fund by the Plan.
(10) To make any payment or distribution required or advisable to carry out the provisions of the Plan, provided that if a trustee is appointed by the Board, such trustee shall make such distribution only at the direction of the employer.
(11) To compromise, contest, arbitrate, enforce or abandon claims and demands with respect to the Plan.
(12) To retain any funds or property subject to any dispute without liability for the payment of interest thereon, and to decline to make payment or delivery thereof until final adjudication is made by a court of competent jurisdiction.
(13) To pay, and to deduct from and charge against the Pension Fund, any taxes which may be imposed thereon, whether with respect to the income, property or transfer thereof, or upon or with respect to the interest of any person therein, which the Fund is required to pay; to contest, in its discretion, the validity or amount of any tax, assessment, claim or demand which may be levied or made against or in respect to the Pension Fund, the income, property or transfer thereof, or in any matter or thing connected therewith.
(14) To appoint any persons or firms (including but not limited to, accountants, investment advisors, counsel actuaries, physicians, appraisers, consultants, professional plan administrators and other specialists), or otherwise act to secure specialized advice or assistance, as it deems necessary or desirable in connection with the management of the Fund, to the extent not prohibited by applicable law, the Board shall be entitled to rely conclusively upon and shall be fully protected in any action or omission taken by it in good faith reliance upon, the advice or opinion of such persons or firms, provided such persons or firms were prudently chosen by the Board, taking into account the interests of the participants and beneficiaries and with due regard to the ability of the persons or firms to perform their assigned functions.
(15) To retain the services of one or more persons or firms for the management of (including the power to acquire and dispose of) all or any part of the Fund assets, provided that each of such persons or firms is registered as an investment advisor under the Investment Advisors Act of 1940, is a bank (as defined in that act), or is an insurance company qualified to manage, acquire or dispose of pension trust assets under the laws of more than one state; in such event, the Board shall follow the directions of such Investment Manager or Managers with respect to the acquisition and disposition of fund assets, but shall not be liable for the acts or omissions of such Investment Manager or Managers, nor shall it be under any obligation to review or otherwise manage any Fund assets which are subject to the management of such Investment Manager or Managers. If the Board appoints a trustee, the trustee shall not be permitted to retain such an Investment Manager except with the express written consent of the Board.
(c) Common Investments. The Board shall not be required to make separate investments for individual participants or to maintain separate investments for each participant's account, but may invest contributions and any profits or gains therefrom in common investments.
(d) Compensation and Expenses of Appointed Trustee. If a trustee is appointed, the trustee shall be entitled to such reasonable compensation as shall from time to time be agreed upon by the Board and the trustee, unless such compensation is prohibited by law. Such compensation, and all expenses reasonably incurred by the trustee in carrying out his or her functions, shall constitute a charge upon the Board or the Pension Fund, which may be executed at any time after 30 days written notice to the Board. The Board shall be under no obligation to pay such costs and expenses, and, in the event of its failure to do so, the trustee shall be entitled to pay the same, or to reimburse itself for the payment thereof, from the Pension Fund.
(e) Periodic Accounting. If a trustee is appointed, the Pension Fund shall be evaluated annually, or at more frequent intervals, by the trustee and a written accounting rendered as of each fiscal year end of the Fund, and as of the effective date of any removal or resignation of the trustee, and such additional dates as requested by the Board, showing the condition of the Fund and all receipts, disbursements and other transactions effected by the trustee during the period covered by the accounting, based on fair market values prevailing as of such date.
(f) Value of the Pension Fund. All determinations as to the value of the assets of the Pension Fund, and as to the amount of the liabilities thereof, shall be made by the Board or its appointed trustee, whose decisions shall be final. In making any such determination, the Board or trustee shall be entitled to seek and rely upon the opinion of or any information furnished by brokers, appraisers and other experts, and shall also be entitled to rely upon reports as to sales and quotations, both on security exchanges and otherwise as contained in newspapers and in financial publications.
(g) Responsibilities of Board. Subject to the limitations of this Plan and of the law, the Board shall perform the following:
(1) Establish rules and regulations for the administration of the Fund and transaction of its business.
(2) Appoint a secretary and such medical, clerical and other employees as may be necessary.
(3) Determine and. fix the compensation of all persons employed by the Board.
(4) Take and accept by gift, grant or bequest, money and property, real, personal and mixed, for the benefit of the Fund, in trust, to be added to the Fund, subject to such directions as the donors of such money and property may prescribe.
(5) Assume such other duties as shall be delegated to it by Council or as set forth under State law.
(h) Plan Administration Expenses. All reasonable expenses incident to the functioning of the Plan Administrator may be paid by the Plan, to the extent permitted by law and not otherwise paid by the employer.
(i) Provisions to Comply with the Municipal Pension Plan Funding Standard and Recovery Act of 1984.
(1) Actuarial valuations.
A. The Plan's actuary shall perform an actuarial valuation at least biennially unless the employer is applying or has applied for supplemental state assistance pursuant to Section 603 of the Act, whereupon actuarial valuation reports shall be made annually.
B. Such biennial actuarial valuation report shall be made as of the beginning of each Plan year occurring in an odd-numbered calendar year, beginning with the year 1985.
C. Such actuarial valuation shall be prepared and certified by an approved actuary, as such term is defined in the Act.
D. The expenses attributable to the preparation of any actuarial valuation report or experience investigation required by the Act or any other expenses which is permissible under the terms of the Act and which are directly associated with administering the Plan shall be an allowable administrative expense payable from the assets of the Pension Fund. Such allowable expenses shall include, but not be limited, to the following:
1. Investment costs associated with obtaining authorized investments and investment management fees;
2. Accounting expenses;
3. Premiums for insurance coverage on fund assets;
4. Reasonable and necessary counsel fees incurred for advice or to defend the fund; and
5. Legitimate travel and education expense for pension plan officials; provided, however, that the Municipal officials of the employer, in their fiduciary role, shall monitor the services provided to the Plan to ensure that the expenses are necessary, reasonable, and benefit the pension plan and, further provided, that the Plan Administrator shall document all such expenses item by item, and where necessary, hour by hour.
(2) Duties of Chief Administrative Officer.
A. Such actuarial reports shall be prepared and filed under the supervision of the Chief Administrative Officer.
B. The Chief Administrative Officer of the Plan shall determine the financial requirements of the Plan on the basis of the most recent actuarial report and shall determine the minimum Municipal obligation of the employer with respect to funding the Plan for any given Plan year. The Chief Administrative Officer shall submit the financial requirements of the Plan and the minimum Municipal obligation of the employer to the Council annually and shall certify the accuracy of such calculations and their conformance with the Act.
(3) Benefit modifications. Prior to the adoption of any benefit plan modification by the employer, the Chief Administrative Officer of the Plan shall provide to the Council a cost estimate of the proposed benefit plan modification. Such estimate shall be prepared by an approved actuary, which estimate shall disclose to the Council the impact of the proposed benefit plan modification on the future financial requirements of the Plan and the future minimum Municipal obligation of the employer with respect to the Plan.
(Ord. 02-02. Passed 4-8-02.)