The City's method of payment of salary and the provision of fringe benefits to all employees of the City who are police patrolmen or sergeants and members of the Fraternal Order of Police, Lodge No. 174 (hereinafter referred to as "covered employees") are hereby confirmed and restated as follows, in order to provide for a fringe benefit pick-up of employee contributions to the Police and Firemen's Disability and Pension Fund (PFDPF), in accordance with Section 414(h)(2) of the Internal Revenue Code of 1986 (referred to hereinafter as "the Code") and rulings thereunder.
(a) The total annual salary and salary per pay period for each covered employee shall be the salary otherwise payable under the applicable contracts and applicable City policies. Such total annual salary and salary per pay period of each employee shall be payable by the City in two parts: deferred salary and cash salary.
(b) Effective January 1, 1992, a covered employee's deferred salary shall be equal to one-half of the member contributions that he or she is required to pay to PFDPF pursuant to Ohio R.C. 742.31, but not in excess of five percent of his or her total annual salary or salary per pay period that is payable to him or her exclusive of his or her deferred salary. Such amount shall be paid by the City directly to PFDPF on behalf of said employee as a "fringe benefit pick-up" of a portion of the PFDPF contribution said employee would otherwise be required to pay. Effective January 1, 1993, a covered employee's deferred salary shall be equal to the total of the member contributions he or she is required to pay to PFDPF pursuant to Ohio R.C. 742.31, but not in excess of ten percent of his or her total annual salary or salary per pay period that is payable to him or her without regard to his or her deferred salary. Such amount shall be paid by the City to PFDPF on behalf of such employee as a "fringe benefit pick-up" of the member contribution said employee would otherwise be required to pay. A covered employee's cash salary shall be equal to his or her total annual salary or salary per pay period less the amount of the fringe benefit pick up, and such amount shall be payable to him or her (subject to applicable payroll deductions, including member contributions required to be paid to PFDPF which are not paid pursuant to the fringe benefit pick-up).
(c) The fringe benefit pick-up shall not be included in the covered employee's total annual salary for the purpose of computing daily rate of pay, for determining paid salary adjustments to be made due to absence or for any similar purpose. Amounts that are picked up by the City as a fringe benefit pick-up shall not be considered additional salary for purposes of Ohio R.C. 742.01(N).
(d) The fringe benefit pick-up by the City of a covered employee's contributions to PFDPF shall be mandatory for all covered employees. No covered employee shall have the option of choosing to receive the pick-up amounts directly instead of having them paid by the City to PFDPF.
(e) The City shall fulfill its income tax reporting and withholding responsibilities for each employee in such manner as is required by applicable Federal, State and local laws and regulations as they may exist at the time of such reporting and withholding. It is the City's understanding that Federal and Ohio income tax laws and regulations presently require the City to report, as an employee's gross income, such employee's cash salary, and applicable municipal income tax laws may or may not require the City to report, as an employee's gross income, his or her total annual salary, inclusive of the amount of the fringe benefit pick-up.
(f) The Director of Finance is hereby directed to take all acts necessary and appropriate to ensure the continued implementation of the fringe benefit pick-up in accordance with the provisions of this section, including, but not limited to, making applications to the Internal Revenue Service and the board administering the PFDPF program to determine the requirements, if any, of the Internal Revenue Service and such board in connection with such pick-up plan.
(Ord. 4213. Passed 6-15-92.)