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Sec. 22-45(a). Investments. The board shall have full power to invest and reinvest all moneys belonging to the system's trust fund and to hold, purchase, sell, assign, transfer or dispose of the securities or investment in which such moneys have been invested. The board or any agents employed by the board may:
(1) Invest and reinvest the principal and income of the trust fund without distinction between principal and income;
(2) Sell, exchange, convey, transfer or otherwise dispose of any investments of the trust fund held in the name of the system by private contract or at public auction;
(3) And with regard to trust fund investments:
(A) Vote upon any stocks, bonds or other securities;
(B) Give general or special proxies or powers of attorney with or without power of substitution;
(C) Exercise any conversion privileges, subscription rights or other options and make any payments incidental thereto;
(D) Consent to, or otherwise participate in, corporate reorganizations or other changes affecting corporate securities and delegate discretionary powers and pay any assessments or charges in connection therewith;
(E) Generally exercise any of the powers of any owner with respect to securities or other investments held in the trust fund;
(4) Make, execute, acknowledge and deliver any and all other instructions that may be necessary or appropriate to carry out the powers herein granted;
(5) Register any investment held in the trust fund in the name of the system or in the name of the nominee;
(6) At the expense of the system, enter into agreement with a trustee or manager for the acquisition and safekeeping and handling of securities and other investments coming into the possession of the board; the agreement shall be entered into under such terms and conditions as shall secure the proper safeguarding, inventory, withdrawal and handling of the securities and other investments; no access to, and no deposit or withdrawal of, the securities from any place of deposit selected by the board shall be permitted or made except as the terms of the agreement may provide; and
(7) Do all other acts and engage in other transactions whether or not expressly authorized which may be deemed necessary or proper for the growth and protection of the investment held in the trust fund.
Sec. 22-45(b). Due diligence. In making each and all such investments, the board shall exercise the judgment and care under the circumstances then prevailing which persons of ordinary prudence, discretion and intelligence exercise in management of their own affairs, not in regard to speculation, but in regard to the permanent disposition of their funds, considering the probable income therefrom as well as the probable safety of the capital. The board shall not be held liable for the exercise of more than ordinary care and prudence in the selection of investments and shall not be limited to so-called "legal investments for trustees"; but all assets of the system shall be invested subject to all conditions, limitations and restrictions imposed by law.
(Ord. No. 10657, § 4, 4-28-09, eff. 7-1-09)
The finance director or his/her designee shall deposit the system’s assets in the trust fund held by the custodial financial institution selected by the board to maintain the assets in trust for the benefit of the members. The finance director shall be responsible for maintaining a system of accounts for the assets in accordance with generally accepted accounting principles for pension funds. The finance director also shall be responsible for oversight of the payroll procedures connected to the system administration, such as the collection of contributions pursuant to section 22-35(d). The finance director shall serve as the secretary of the board.
(Ord. No. 10657, § 4, 4-28-09, eff. 7-1-09; Ord. No. 11327, § 17, 12-8-15, eff. 1-1-16)
The human resources director or his/her designee shall provide the board with all relevant information available in the city’s human resources department concerning the employment status of members.
(Ord. No. 10657, § 4, 4-28-09, eff. 7-1-09; Ord. No. 11327, § 18, 12-8-15, eff. 1-1-16)
The system administrator is charged with the day to day administration of the system and oversight of the city's retirement office and personnel. The system administrator shall be an individual having a demonstrated familiarity with one or more disciplines such as finance, accounting, actuarial evaluations, investments or tax law. The system administrator shall attend board meetings, consult with other professionals employed by the board and shall report to the board on such matters as may affect the administration of the system. The system administrator shall make all such decisions as are necessary for the daily operation of the system, exercise the discretion necessary to carry out its functions hereunder and supervise such employees who may be assigned to assist in the operation of the system.
(Ord. No. 10657, § 5, 4-28-09, eff. 7-1-09)
To the extent permitted by law, the board, the individual members of the board and the system administrator shall be indemnified and held harmless against any and all liabilities (including defense costs and expenses) arising by reason of an act or failure to act in their fiduciary and administrative capacities to the system, and for liability and costs resulting from the acts and omissions of their duly appointed agents, except for those acts, omissions, or conduct resulting from their own willful misconduct, willful failure to act, or gross negligence. The system shall maintain fiduciary liability insurance designed to fund the indemnification provided by this section. The city shall be liable for indemnification under this section only to the extent that the liability exceeds the amount available through the system's fiduciary liability insurance.
(Ord. No. 10657, § 5, 4-28-09, eff. 7-1-09)
Sec. 22-50(a). Fraudulent acts prohibited. Any person who knowingly makes any false statement with respect to or falsifies or permits to be falsified any record, application or form of the system in an attempt to defraud the system or defeat the right of a member to receive a retirement benefit to which they may be entitled is guilty of a crime and shall be subject to prosecution in accordance with the applicable criminal statutes.
Sec. 22-50(b). Correction of errors. The board shall correct errors in the records and actions of the system administration. The board shall seek to recover overpayments and shall make up underpayments. Recovery of overpayments may be accomplished by reducing the amount of future payments so that the actuarial present value of actual payments is equal to the actuarial present value of correct payments.
Sec. 22-50(c). Employment rights. The system shall not be construed as giving an employee any right to be retained in the service of the city without its consent nor shall the system interfere with the right of the city to discharge an employee, nor shall an employee be given any right, claim or interest in any benefits of the system except upon fulfillment of the conditions and requirements of the system.
Sec. 22-50(d). Applicable laws. The system shall be construed and enforced under the laws of the State of Arizona and any federal law, rule or regulation applicable to a tax-qualified governmental retirement plan structured in accordance with Section 414(d) of the Code and Section 3(32) of the Employee Retirement Income Security Act of 1974, and all of the provisions hereof shall be administered in accordance therewith.
(Ord. No. 10657, § 5, 4-28-09, eff. 7-1-09)
Sec. 22-51(a). Amendment or repeal of system; non-forfeiture of benefits. The mayor and city council may alter, amend or repeal any provision of the system or its application to any person. All accrued benefits that have vested or accrued at the time of such alteration, amendment or repeal shall not be affected thereby for any member or beneficiary.
Sec. 22-51(b). Continuing administration of the system. In the event the mayor and city council repeal the provisions of this article, the board shall continue to administer the system in accordance with the provisions of this article for the sole benefit of the then members, any beneficiaries receiving retirement benefit payments, and any future persons entitled to receive retirement benefit payments as beneficiaries of any such beneficiaries or members. The remaining assets of the system shall be allocated by the board in an equitable manner to provide a distribution for all designated persons in accordance with the provisions of the system, but based on years of credited service and average final monthly compensation as of the date of repeal and in the following order:
(1) First, for the benefit of the then members to the extent of their individual accumulated contributions account. Members are hereby declared to have a property right in such accumulated contributions and shall have an unrestricted right to withdraw such accumulated contributions in the event of repeal of this article. If any assets remain, then
(2) Second, for the benefit of the then beneficiaries and persons already designated by former members under one (1) of the retirement benefit payment options provided for in this article to the extent of the member's accrued benefit. If any assets remain, then
(3) Third, for the benefit of those members who may elect not to withdraw their accumulated contributions and retain a right to a deferred retirement benefit and the individuals, if any, designated by such members under one (1) of the retirement benefit payment options, to the extent of the member's accrued benefit. The allocation under this paragraph shall be on the basis of greatest length of credited service first.
Sec. 22-51(c). Allocation of additional funds by the city. In the event the assets at the date of repeal of the system are insufficient to provide all required distributions, the city shall contribute to the assets of the system, as and when required, any amount necessary to make up such deficiency.
Sec. 22-51(d). Payment of distributions. The allocation of assets of the system provided for in this section shall be carried out through the payment of distributions provided for in this section as they become due, or by the transfer of such assets to a successor retirement system replacing this system; provided, that all vested benefits provided in this section shall be fully maintained under any successor retirement system.
Sec. 22-51(e). Reversion of assets to the general fund of the city. Any assets remaining in the system after all liabilities prescribed by this section have been paid shall revert to the general fund of the city.
(Ord. No. 10657, § 5, 4-28-09, eff. 7-1-09)
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