2008-33RESOLUTION NO. 2008 - 33
COUNCIL MEMBER WOLFF INTRODUCED THE FOLLOWING RESOLUTION:
BE IT RESOLVED BY THE MAYOR AND THE CITY COUNCIL OF BLAIR,
NEBRASKA:
ATTEST:
(SEAL)
1. That in order to adopt the amendments required for tax - qualified retirement plans
under the Economic Growth and Tax Relief Reconciliation Act of 2001, the
Pension Funding Act of 2004, the American Jobs Creation Act of 2004, the Gulf
Opportunity Zone Act of 2005, certain changes under the Pension Protection Act
of 2006, and all other tax laws enacted since the Plan was last amended, as such
laws apply to government plans, and to make certain other amendments to the City
of Blair, Nebraska Blair Police Retirement Plan and Trust (the "Plan ") as required
by applicable tax laws and regulations, the Plan shall be, and it hereby is, amended
and restated effective January 1, 2008 in the form of the Plan document submitted
at this meeting and by this reference made a part of this resolution.
2. That the Mayor and appropriate officers of the City of Blair shall be, and they
hereby are, authorized to do any and all things, including the execution of any
document or amendment which may be necessary or appropriate to establish and
administer the amended and restated Plan, including such actions as may be
necessary or appropriate to achieve and maintain the tax qualification of the
amended and restated Plan under Section 401(a) of the Internal Revenue Code of
1986, as amended.
COUNCIL MEMBER FANOELE MOVED THAT THE RESOLUTION BE ADOPTED AS
READ, WHICH SAID MOTION WAS SECONDED BY COUNCIL MEMBER FANOELE.
UPON ROLL CALL, COUNCIL MEMBERS STEWART, SHOTWELL, FANOELE,
CHRISTIANSEN, ABBOTT, WOLFF AND BIFFAR VOTING "AYE" AND COUNCIL
MEMBERS NONE VOTING "NAY ", THE MAYOR DECLARED THE FOREGOING
RESOLUTION PASSED AND APPROVED THIS 26 DAY OF AUGUST, 2008.
BRENDA R. WHEELER, CITY CLERK
CITY OF BLAIR, NEBRASKA
BY
,TAM
E. REALPH, MAYOR
STATE OF NEBRASKA )
WASHINGTON COUNTY )
:ss:
BRENDA R.WHEELER, hereby certifies that she is the duly appointed, qualified and
acting City Clerk of the City of Blair, Nebraska, and that the above and foregoing Resolution
was passed and adopted at a regular meeting of the Mayor and City Council of said City, held
on the 26th day of August, 2008.
BRENDA WHEELER, CITY CLERK
CITY OF BLAIR, NEBRASKA
BLAIR POLICE RETIREMENT
PLAN AND TRUST
CITY OF BLAIR, NEBRASKA
BLAIR POLICE RETIREMENT PLAN AND TRUST
INDEX
Page
Introduction 1
Article I Creation and Purpose of Trust 1
1.1 Prior Plan 1
1.2 Purpose 1
1.3 Exclusive Benefit. 2
Article II Definitions and Construction 3
2.1 Retirement Committee 3
2.2 City 3
2.3 Compensation 3
2.4 Final Average Compensation 3
2.5 Police Officer 3
2.6 Participant 3
2.7 Pension Fund 4
2.8 Plan 4
2.9 Plan Year 4
2.10 Prior Plan 4
2.11 Retirement Value 4
2.12 Annuity Contract 4
2.13 Regular Interest 4
2.14 Retirement Date 4
2.15 Retirement Benefit 4
Article III Participation in Plan 5
3.1 Eligibility 5
3.2 Entry Into Plan 5
3.3 Classes of Benefits Provided 5
3.4 Contributions Required 5
3.5 Transfers of Plan Contributions 6
3.6 Eligible Rollover Distributions 6
Article IV Service 8
4.1 Service 8
4.2 Termination of Employment 8
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4.3 Benefits for Period of Active Military Service 8
Article V Contributions 10
5.1 Establishment of Accounts 10
5.2 Prior Employee Contributions and
Matching Contributions by City 10
5.3 Employee Contributions 10
5.4 Matching Employer Contributions 10
5.5 Additional City Contributions 11
5.6 Pick Up Provisions 11
5.7 Voluntary Contributions 11
5.8 Limitations on Contributions 11
5.9 Limitation for Multiple Plans 13
5.10 Adjustments to Annual Additions 13
5.10 Adjustments to Section 415 Limitations 13
Article VI Disability 15
6.1 Disability Benefit 15
6.2 Definition of and Establishing
Permanent Disability 15
6.3 Temporary Disability 15
6.4 Workers' Compensation Benefit 16
6.5 Minimum Disability Retirement Benefits 16
Article VII Retirement Benefit 17
7.1 Election to Retire 17
7.2 Normal Retirement Date 17
7.3 Early Retirement Date 17
7.4 Deferred Retirement Date 17
7.5 Annuity Commencement Date 17
Article VIII Retirement Income Benefits 18
8.1 Normal Retirement Benefit 18
8.2 Early Retirement Benefit 18
8.3 Minimum Retirement Benefits 18
8.4 Normal Form of Retirement Income 18
8.5 Optional Forms of Retirement Income 19
8.6 Mandatory Lump -Sum Cash -Out 19
8.7 Distributions to Comply with Tax Laws 20
Article IX Death Benefit 21
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9.1 Death Benefit Prior to Annuity Commencement 21
9.2 Death Benefit After Annuity Commencement 21
9.3 Survivor's Income Benefits 21
9.4 Designation of Beneficiary 23
9.5 Purchase of Annuity Contracts 23
9.6 Distributions to Comply with Tax Laws 23
Article X Distribution of Benefits Upon Termination of Employment 24
10.1 Termination Benefit 24
10.2 Termination Benefit Payment Option 24
10.3 Vesting Percentage 24
10.4 Payment of Deferred Retirement Annuity 24
10.5 Involuntary Cash -Outs of Small Accounts 25
10.6 Forfeitures 25
10.7 Distributions to Comply With the Tax Laws 25
Article XI Administration 26
11.1 Establishment of Retirement Committee 26
11.2 Retirement Committee Members 26
11.3 Specific Duties of the Retirement Committee 26
11.4 General Powers and Duties 27
11.5 Power to Make Adjustments and Corrections 27
11.6 Use of Alternative Media 27
11.7 Uniform Administration 28
11.8 Liability Limited 28
Article XII Pension Fund 29
12.1 Pension Fund 29
12.2 Plan Investments 29
12.3 Directed Investments 29
12.4 Change in Investment Direction 30
12.5 Fund Gains and Expenses 31
12.6 Investment Advisers 31
12.7 Liability of Fiduciary 31
12.8 Regulated Investment Company Mutual Funds 31
12.9 Trustee Powers and Duties 31
12.10 Insurance Contracts 32
12.11 City Treasurer as Trustee 32
12.12 Expenses 32
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Article XIII Miscellaneous Provisions 33
13.1 Non - Alienation of Benefits 33
13.2 Minimum Distribution Requirements 33
13.3 Plan Not a Contract of Employment 37
13.4 Modification or Discontinuance of the Plan or
Complete Discontinuance of Contribution 38
13.5 Vesting and Allocation of Pension Fund on Termination of
Plan or Complete Discontinuance of Contributions 38
13.6 Qualification of Plan 39
13.7 Workers' Compensation Benefits 39
13.8 Merger or Consolidation 39
13.9 Tax Withholding 39
13.10 Invalidity of Certain Provisions 39
13.11 Additional Limitations 39
13.12 Compliance With Internal Revenue Code 40
13.13 Counterparts 40
13.14 Plan Construed as a Whole 40
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CITY OF BLAIR, NEBRASKA
BLAIR POLICE RETIREMENT PLAN AND TRUST
Introduction and Parties
This Trust Agreement, effective as of January 1, 1984, as amended and restated
effective January 1, 1997, and as subsequently amended, is hereby further amended and restated
effective as of January 1, 2008 by and between the City of Blair, Nebraska, and the City Treasurer
of the City of Blair, Nebraska (hereinafter referred to as the "Trustee ").
WITNES SETH:
WHEREAS, to maintain its qualification as a tax - exempt money purchase
pension plan and trust under Sections 401(a) and 501(a) of the Internal Revenue Code of 1986,
as amended, as said Sections apply to government plans, it is necessary that the Plan and Trust
be amended to incorporate the applicable changes in tax laws and regulations required for the
Plan under the Economic Growth and Tax Relief Reconciliation Act of 2001, the Pension
Funding Act of 2004, the American Jobs Creation Act of 2004, the Gulf Opportunity Zone Act
of 2005, certain changes under the Pension Protection Act of 2006, and all other changes
required by applicable law or as otherwise determined to be necessary and appropriate by the
City of Blair, Nebraska.
NOW, THEREFORE, pursuant to its power and authority to amend the Plan and
Trust, the Plan and Trust is hereby amended and restated by the City of Blair, Nebraska, as
follows:
ARTICLE I
Creation and Purpose of Trust
1.1 Prior Plan. The City of Blair, Nebraska (hereinafter referred to as the "City ")
has maintained a pension system as required by Nebraska Statutes to provide retirement benefits for
its salaried Police Officers. The pension system for the City's Police Officers was amended and
restated in the form of this Plan and Trust effective as of January 1, 1984, and subsequently
amended and restated effective as of July 15, 1992. Except as otherwise stated, this amendment and
restatement is effective January 1, 2008. The rights and benefits of Police Officers who retired or
became eligible for other benefits before January 1, 2008, shall be determined in accordance with
the provisions of this Plan and Trust which were in effect prior to January 1, 2008.
1.2 Purpose. The primary purpose of the Plan is to provide retirement income,
disability income, and other benefits for Police Officers in addition to, or in conjunction with, the
benefits provided under the Federal Social Security Act and the Nebraska Workers' Compensation
Act, in consideration of their service to the City. The Plan and Trust is designed to comply with
State of Nebraska Revised Statutes relating to police officer retirement systems of cities of the first
class, and is intended to meet the requirements of Section 401(a) of the Internal Revenue Code of
1986, as amended, as such requirements apply to government plans, in order that the Plan and Trust
may qualify as a tax- qualified money purchase pension plan.
1.3 Exclusive Benefit. This Plan and Trust are established and shall be
maintained for the sole and exclusive benefit of those Police Officers who shall be eligible to
participate under the Plan and for the benefit of beneficiaries of such Police Officers in the event of
their death. No part of the Pension Fund can revert to the City, except as allowed by law, or be used
or diverted to purposes other than for the exclusive benefit of the Police Officers and their
beneficiaries.
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ARTICLE II
Definitions and Construction
The following words and phrases when used in this Plan, unless the context clearly
indicates otherwise, shall have the following meanings:
2.1 "Retirement Committee." Retirement Committee means the Retirement
Committee as provided under Article XI of this Plan.
2.2 "City." City means the City of Blair, Nebraska.
2.3 "Compensation." Compensation means the total amount of taxable salary or
wages paid by the City to a Participant for personal services as reported on the Participant's federal
income tax withholding statement, and in addition thereto, employee contributions picked -up by the
City, as provided in Article V, to the extent not included in the Participant's gross income as salary
or wages. Any amounts which are not currently includible in the Participant's gross income by
reason of the application of Sections 125 or 457 of the Internal Revenue Code shall nevertheless be
treated as Compensation for purposes of this Plan. Beginning with the Plan Year which commences
on January 1, 2001, only the first $200,000 of Compensation paid in a Plan Year, as adjusted after
December 31, 2001, for increases in the cost of living in accordance with Section 401(a)(17)(B) of
the Internal Revenue Code, shall be taken into account for all purposes of the Plan. The
Compensation limit in effect for a Plan Year is the Compensation limit in effect at the beginning of
that Plan Year and applies to any period, not exceeding 12 months, over which Compensation is
determined ( "determination period "). If a determination period consists of fewer than 12 months,
the annual Compensation limit will be multiplied by a fraction, the nominator of which is the
number of months in the determination period, and the denominator of which is 12.
2.4 "Final Average Compensation." Final Average Compensation means the
Compensation received by the Participant during the final sixty (60) months of his or her
employment, divided by sixty (60); provided, however, for any Police Officer who retires, dies or
becomes disabled after July 14, 1992, Final Average Compensation shall be determined on the basis
of the Compensation paid in any five consecutive year period preceding the Police Officer's
retirement, death or disability which produces the highest average.
2.5 "Police Officer." Police Officer means a person who is employed by the
City as a full time police officer as determined by the City under its normal practices. A "leased
employee" shall not be considered a Police Officer. For these purposes, a "leased employee" means
any person, other than an employee of the City, who pursuant to an agreement between the City and
any other person ( "leasing organization ") has performed services for the City on a substantially full -
time basis for a period of at least one (1) year provided such services are performed under primary
direction or control by the City.
2.6 "Participant." Participant means a Police Officer, retired Police Officer, or
former Police Officer as defined herein who has met all the requirements of this Plan, and has
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entered this Plan as provided in Article III, and who continues to have rights or contingent rights to
benefits payable under this Plan.
2.7 "Pension Fund." Pension Fund means the trust fund established hereunder to
provide for the payment of the benefits specified in the Plan, as described in Section 12.1.
2.8 "Plan." Plan means the City of Blair, Nebraska Blair Police Retirement Plan
and Trust, the terms of which are herein set forth, and as may be amended by the City from time to
time.
2.9 "Plan Year." Plan Year means a 12 -month period beginning on January 1
and ending on December 31.
2.10 "Prior Plan." Prior Plan means the pension plan and system benefiting the
City's Police Officers before January 1, 1984, and which was replaced by this Plan and Trust.
2.11 "Retirement Value." Retirement Value means the accumulated value, at any
particular point in time, of the Participant's employee and employer contribution accounts as
provided in Article V.
2.12 "Annuity Contract." Annuity Contract means a contract or contracts issued
by one or more life insurance companies that may be purchased for the purpose of providing all or a
portion of the benefits under this Plan. Such term shall include group annuity contracts which are
an investment of the Pension Fund. Annuity conversion rates contained in any such contract shall
be specified on a sex neutral basis.
2.13 "Regular Interest." Regular Interest means the rate of net earnings realized
for any Plan Year or other valuation period beginning with the year which commenced on January
1, 1984, as determined by the Retirement Committee in conformance with actual earnings or losses
realized by the Pension Fund for any such year.
2.14 "Retirement Date." Retirement Date means the first of the month
immediately following the last day of employment with the City with respect to normal or early
retirements, or the date benefit payments are to commence with respect to deferred retirement dates.
2.15 "Retirement Benefit." Retirement Benefit means the retirement income
benefit payable to a Participant at his or her Normal or Early Retirement Date, or at his or her
Deferred Retirement Date (as defined in Article VII). The normal form of the Retirement Benefit
shall be a straight life annuity paying monthly benefits. The amount of retirement income benefit
for any Participant shall be the amount of pension benefit that can be purchased or otherwise
provided by the Participant's Retirement Value.
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ARTICLE III
Participation in Plan
3.1 Eligibility. All Police Officers employed by the City as of the date of this
amendment and restatement of the Plan will continue to participate under the terms of this amended
and restated Plan. All Police Officers first employed after such date, or any former Police Officers
rehired by the City, will become eligible for participation in the Plan immediately as of the date
hired or rehired by the City.
3.2 Entry Into Plan. All Police Officers employed by the City will automatically
become Plan Participants upon meeting the eligibility requirements of this Article III.
3.3 Classes of Benefits Provided:
(a) This Plan provides for payment of a Retirement Benefit to each Participant
who retires in accordance with the provisions of Article VII.
(b) This Plan further provides death benefits to beneficiaries, as provided in
Article IX.
(c) This Plan further provides for disability pension benefits as provided in
Article VI.
(d) This Plan further provides for the payment of benefits to Participants on
termination of service for reasons other than death, disability or retirement, as
provided in Article X.
Unless otherwise specifically provided, any form of pension or annuity benefit under this Plan shall
be the actuarial equivalent of the normal form of benefit specified in Section 8.4. For this purpose,
"actuarial equivalent" shall mean equality in value of the aggregate amount of benefit expected to be
received under different forms or at different times based on the mortality assumptions of the 1983
Group Annuity Table- -Male (mortality will be determined by using the table's male mortality for
Police Officers and the table's female mortality for spouses) and seven percent (7 %) interest per
annum; provided, however, for lump sum distributions, the male rate factors in effect for the
Pension Benefit Guaranty Corporation for plan terminations at the time of distribution shall be used.
Notwithstanding the foregoing, in the event that benefits provided for a Participant or beneficiary
are obtained through the purchase of an annuity contract, the actuarial equivalency of any such form
of benefit shall be the amount of pension benefit that can be purchased or otherwise provided by
the Participant's Retirement Value.
3.4 Contributions Required. All Participants in this Plan, as a condition to
participation in the Plan, are required to make individual employee contributions in accordance with
Article V. The City will make employer account contributions in accordance with Article V. In
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addition thereto, the cost of all benefits provided by this Plan in excess of benefits provided by the
Participant's Retirement Value shall be provided by contributions by the City.
3.5 Transfers of Plan Contributions. In the event that after four or more years of
employment as a Police Officer by another first -class city in Nebraska, a Police Officer terminates
his or her employment with such other city for the purposes of becoming a Police Officer of the
City, and such new employment commences within one hundred twenty days of the termination of
employment, the full accumulated value of his or her employee account and the vested portion of
his or her employer account at the time of termination may be directly transferred to this Plan. The
transferred funds shall be administered by the Retirement Committee under a segregated account
established for this purpose. For the purposes of applying the vesting schedule of Article X to
employer contributions made following the commencement of new employment, such Police
Officer shall be deemed a new employee. The Trustee shall also make such direct transfers to the
retirement system of any other first -class city in Nebraska for a Participant who terminates
employment with the City and becomes a Police Officer of such other first -class city. Upon the
transfer of the Participant's employee account and the vested interest of his or her employer account,
all obligations of this Plan and the City to such Participant and his or her beneficiary shall terminate.
3.6 Eligible Rollover Distributions. Notwithstanding, any provision of the Plan
to the contrary that would otherwise limit a distributee's election under this Section, a distributee
may elect, at the time and in the manner prescribed by the Retirement Committee, to have any
portion of an eligible rollover distribution paid directly to an eligible retirement plan specified by
the distributee in a direct rollover. For purposes of this Section 3.6, the following definitions shall
apply:
(a) Eligible rollover distribution: An eligible rollover distribution is any distribution of
all or any portion of the balance to the credit of the distribute, except than at an eligible
rollover distribution does not include: any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee
and the distributee's designated beneficiary, or for a specified period of ten years or more;
any distribution to the extent such distribution is required under Section 401(a)(9) of the
Internal Revenue Code; effective for distributions after December 31, 1998, any hardship
distribution (if permitted by this Plan).
For purposes of this Section 3.6(a), a portion of the distribution shall not fail to be an
eligible rollover distribution merely because the portion consists of after -tax employee
contributions which are not includible in gross income. However, such portion may be
transferred only to an individual retirement account or annuity described in Section 408(a)
or (b) of the Internal Revenue Code, or to a qualified defined contribution plan described in
Section 401(a) or 403(a) of the Internal Revenue Code that agrees to separately account for
amounts so transferred, including separately accounting for the portion of such distribution
which is so includible in gross income and the portion of such distribution which is not so
includible.
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(b) Eligible retirement plan: An eligible retirement plan is an individual retirement
account described in Section 408(a) of the Internal Revenue Code, an individual retirement
annuity described in Section 408(b) of the Internal Revenue Code, an annuity plan described
in Section 403(a) of the Internal Revenue Code, an annuity contract described in Section
403(b) of the Internal Revenue Code, an eligible plan under Section 457(b) of the Internal
Revenue Code which is maintained by a state, political subdivision of a state, or any agency
or instrumentality of a state or political subdivision of a state and which agrees to separately
account for amounts transferred into such plan from this Plan or a qualified plan described
in Section 401(a) of the Internal Revenue Code that accepts the distributee's eligible rollover
distribution. This definition shall also apply in the case of a distribution to a surviving
spouse of the Participant or to a spouse or former spouse who is an alternate payee under a
Qualified Domestic Relations Order as defined in Section 414(p) of the Internal Revenue
Code, that accepts the distributee's eligible rollover distribution. For purposes of a
distribution on behalf of a designated beneficiary who is not a spouse or former spouse of
the Participant, "Eligible Retirement Plan" shall mean an individual retirement account
described in Section 408(a) of the Internal Revenue Code established for the purpose of
receiving a distribution on behalf of the designated beneficiary and that will be treated as an
inherited IRA pursuant to the provisions of Section 402(c)(11) of the Internal Revenue
Code.
(c) Distributee: A distributee includes a Participant or former Participant. In addition,
the Participant's or former Participant's surviving spouse and the Participant's or former
Participant's spouse or former spouse who is the alternate payee under a qualified domestic
relations order, as defined in Section 414(p) of the Internal Revenue Code, are distributees
with regard to the interest of the spouse or former spouse. Effective January 1, 2007,
"distributee" shall also include a Participant's designated beneficiary who is not the
Participant's surviving spouse or former spouse.
(d) Direct rollover: A direct rollover is a payment by the Plan to the eligible retirement
plan specified by the distributee.
Distributions which are not subject to the foregoing rules may commence less than thirty (30) after
notice to the distributee is given, provided that (i) the Retirement Committee clearly informs the
distributee that the distributee has a right to a period of at least thirty (30) days after receiving the
notice to consider the decision of whether or not to elect a distribution (and, if applicable, a
particular option), and (ii) the distributee, after receiving the notice, affirmatively elects a
distribution.
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ARTICLE IV
Service
4.1 Service. The period of service ( "Service ") of a Participant will be his or her
period of employment by the City as a paid Police Officer from his or her most recent date of hire
by the City up to the date of Termination of Employment. For purposes of vesting in the amounts
credited to a Participant's employer contribution account, years of Service performed prior to
January 1, 1966, shall be disregarded. Service performed as a police officer of any other city or
governmental entity shall be disregarded for all purposes under the Plan.
4.2 Termination of Employment. A Participant's Termination of Employment
will occur on the date of severance of employment as a Police Officer before the Participant's
Normal or Early Retirement Date (as defined in Article VII) as determined under the City's normal
employment policies, other than a severance on account of death or permanent disability in the line
of duty (as defined in Section 6.1), subject to the following:
(a) Termination of active service with the City on account of a leave of absence
granted by the City shall not be considered a Termination of Employment for the
purposes of this Plan unless the Participant fails to return to active service with the
City within one week after the date such leave was to have ended, in which event a
Termination of Employment will be considered to have occurred at the time the
leave of absence was to have ended;
(b) Termination of active service with the City on account of entrance into the
Armed Forces of the United States during any period of qualified military service as
defined in Section 414(u) of the Internal Revenue Code shall not be considered a
Termination of Employment (and such Participant's Service shall not be interrupted)
for the purposes of this Plan unless the Participant fails to return to active service
with the City within the applicable period required under the Uniformed Services
Employment and Reemployment Rights Act of 1994 after the date the Participant
first became eligible for release from active duty with such Armed Forces, in which
event a Termination of Employment will be considered to have occurred as of the
end of such period; and
(c) Termination of active service with the City on account of sick leave shall not
be considered a Termination of Employment for the purpose of this Plan, unless the
Participant fails to return to work when pronounced fit for duty.
4.3 Benefits for Period of Active Military Service. Any Participant who
is eligible for reemployment on or after December 12, 1994, pursuant to the Uniformed
Services Employment and Reemployment Rights Act of 1994, as amended, may pay to the
Plan after the date of his or her return from active military service and within the period
required by law, not to exceed five years, an amount equal to the sum of all contributions
which would have been made by the Participant pursuant to Article V during the period of
8
military service for which credited serviced is desired. For this purpose, the Participant's
Compensation during the period of military service shall be assumed to have been the same
rate of Compensation the Participant would have received from the City, or if such
Compensation is not reasonably determinable, the Participant's average Compensation
during the 12 -month period immediately preceding the period of military service. If such
make -up contributions are made, the Participant shall be entitled to credited service for the
period for which contributions have been made and the City shall be responsible for any
Matching Employer Contributions on such contributions pursuant to Section 5.4 The make-
up contributions by the Participant may be paid by making a direct payment to the Plan, by
installment payments to the Plan, or pursuant to a binding irrevocable payroll deduction
authorization between the Participant and the City.
Notwithstanding any provision of this Plan to the contrary, effective December 12, 1994,
contributions, benefits and service credit with respect to qualified military service will be
provided in accordance with Section 414(u) of the Internal Revenue Code.
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ARTICLE V
Contributions
5.1 Establishment of Accounts. The Trustee shall create and maintain separate
accounts in the name of each Participant for the crediting of each Participant's contributions and
matching City contributions. The account established for a Participant's contributions shall be
designated as the "employee contribution account" and the account established for the City's
contribution shall be designated as the "employer contribution account." All amounts credited to a
Participant's employee contribution account and employer contribution account under the Prior Plan
are held in the corresponding accounts established under this Plan and Trust for such contributions.
As of the last day of each Plan Year, all accounts (including any segregated account established to
hold transferred pension funds pursuant to Section 3.5) will be credited with a proportionate share of
the Pension Fund's Regular Interest for such Plan Year and currently valued. At the direction of the
Retirement Committee, more frequent valuations and interim adjustments of the Plan accounts may
be made by the Trustee. Except as may otherwise be provided in Article XII, the Trustee shall not
be required to maintain separate investments for any account.
5.2 Prior Employee Contributions and Matching Contributions by. City. All
retirement contributions made by a Participant to the Prior Plan before to January 1, 1984, and held
by the City will be transferred to such Participant's employee contribution account as of January 1,
1984. Interest will not be credited on such contributions for periods prior to January 1, 1984, unless
the City determined, at the time of the transfer, to credit interest on such amounts. At the time a
Participant retires or terminates his or her employment with the City, the Participant's employer
contribution account shall be credited, at such time, with an amount equal to the Participant's
contributions that were made by such Participant prior to January 1, 1984 (the "Drop -in Amount ").
No interest credit shall be added to the Drop -in Amount unless the City shall determine, at its sole
discretion, to credit interest on the Drop -in Amount. At the sole option of the City, the Drop -in
Amount may be made on a uniform basis for all Police Officers before their respective retirement or
Termination of Employment. Amounts credited to the employer contribution account pursuant to
this Section 5.2 shall be subject to the vesting schedule of Section 10.3.
5.3 Employee Contributions. Beginning January 1, 1984, each Participant will
have employee contributions deducted from his or her periodic salary payments in an amount equal
to six percent (6 %) of the Participant's Compensation for such period. Such employee contributions
shall be paid into the Pension Fund and be credited to the Participant's employee contribution
account on a monthly basis, and shall be paid to the Pension Fund no later than the fifteenth (15
day of the month following the month in which the Employee Contributions were deducted by the
City from the Participant's salary.
5.4 Matching Employer Contributions. Beginning January 1, 1984, the City will
make employer contributions for each Participant in an amount equal to six percent (6 %) of the
Participant's Compensation. Such contributions will be paid into the Pension Fund and credited to
the Participant's employer contribution account on a monthly basis.
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5.5 Additional City Contributions. The City will contribute any amounts
necessary to fund retirement or other Plan benefits not provided by employee contributions or
matching employer contributions. Such additional contributions will be held as an unallocated
portion of the Pension Fund and will be credited or charged with a proportionate share of the total
investment earnings or losses and appreciation and depreciation of the Pension Fund.
5.6 Pick Up Provisions. Effective as of January 1, 1984, the City shall pick up
employee contributions required under Section 5.3 and deducted from the Compensation of Plan
Participants, and the contributions so picked up shall be treated as employer contributions in
determining federal tax treatment under the Internal Revenue Code of 1986, as the same may be
amended. However, the City shall continue to withhold Federal income taxes based on these
employee contributions until the Internal Revenue Service or the federal courts rule that, pursuant to
Section 414(h) of the Internal Revenue Code, these contributions shall not be included as gross
income of the Participant until such time that they are distributed to the Participants from the Plan.
The City shall pick up these contributions by a salary deduction either through a reduction in the
cash salary of the Participant or a combination of a reduction in salary and offset against a future
salary increase. In no event shall a Police Officer be given an option to choose to receive the
amount of the required employee contribution in lieu of having such amount paid directly to the
Pension Fund.
5.7 Voluntary Contributions. A Participant may elect, from time to time, to
make voluntary cash contributions to the Plan, subject to the limitations of Section 5.8 and 5.11.
Voluntary Contributions will be paid into the Pension Fund and credited to the Participant's
employee contribution account when made. Such Voluntary Contributions shall thereafter be held,
administered, invested, and distributed in the same manner as any other amounts credited to the
Participant's employee contribution account.
5.8 Limitations on Contributions. Notwithstanding any provisions of the Plan to
the contrary, the Annual Addition with respect to any Participant hereunder shall be limited to the
Maximum Annual Addition in accordance with the provisions of Section 415 of the Internal
Revenue Code, and the limitations adjustments and other requirements prescribed in Sections 5.8 to
5.10 shall at all times comply with the provisions of Section 415 of the Internal Revenue Code and
that Income Tax Regulations thereunder, the provisions of which are hereby incorporated herein by
this reference. For the purposes of Sections 5.8, 5.9 and 5.10, the following definitions shall be
applicable beginning with the Plan Year commencing January 1, 2002:
(a) "Annual Addition" shall mean, with respect to any Limitation Year, the sum of the
following which are actually credited to a Participant's accounts as of any date within such
Plan Year:
(1) All contributions by the City (including the employee contributions which
are treated as employer contributions pursuant to Section 5.6) allocated to a
Participant;
(2) All forfeitures, if any, allocated to a Participant;
11
(3) All of the Participant's Voluntary Contributions;
(4) Amounts described in Sections 415(1)(2) and 419A of the Internal Revenue
Code; and
(5) Allocations under a simplified employee pension plan.
Contributions by the City are treated as credited to a Participant's accounts under the
Plan for a particular Limitation Year only if the contributions are actually made to
the Plan no later than the fifteenth (15) day of the tenth (10 calendar month
following the end of the fiscal year with or within which such Limitation Year ends.
(b) The "Maximum Annual Addition" which shall be permitted during any Limitation
Year with respect to any Participant hereunder shall be the lesser of:
(1) $40,000 (as such limit may be adjusted on and after January 1, 2002, for
increases in costs of living in accordance with Section 415(d) of the Internal
Revenue Code in effect for that Limitation Year), or
(2) 100 percent of the Participant's compensation (as defined in subsection (e)
below) paid to the Participant by the City for such Plan Year (subject to the
Compensation limitation of Section 401(a)(17)(B) of the Internal Revenue Code).
The limit in subsection (b)(2) above shall not apply to any contribution for medical benefits
after a separation from service (within the meaning of Sections 401(h) or 419(f)(2) of the
Internal Revenue Code) which is otherwise treated as an Annual Addition.
(c) "Excess Amounts" shall mean the excess of the Participant's Annual Addition for the
Limitation Year over the applicable Maximum Annual Addition as specified in Section 5.8.
(d) "Limitation Year" shall mean the Plan Year for this Plan. In lieu thereof, the City
may adopt any other 12 consecutive month period by amending the Plan. If the City is a
member of a controlled group of corporations, trades or businesses under common control
or an affiliated service group (as defined in Sections 414(b), (c) or (m) of the Internal
Revenue Code) the election to use a consecutive 12 month period other than the Plan Year
must be made by all members of the group that mains the Plan.
(e) "Compensation" shall mean wages within the meaning of Section 3401(a) of the
Internal Revenue Code (for purposes of income tax withholding at the sources) plus
amounts that would be included in wages but for an election under Sections 125(a),
132(f)(4), 402(e)(3), 402(h)(1)(B), 402(k) or 457(b) of the Internal Revenue Code.
Except as provided herein, Compensation for a specified period is the Compensation
actually paid or made available (or if earlier, includible in gross income) during such period.
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Compensation for a Limitation Year shall also include Compensation paid by the later of 2
months after a Participant's severance from employment with the City Plan or the end of the
Plan Year that includes the date of the severance from employment with the City, if the
payment is regular Compensation for services during the Participant's regular working hours
(such as overtime or shift differential), commissions, bonuses, or other similar payments,
and absent a severance from employment, the payments would have been paid to the
Participant while the Participant continued in employment with the City.
Any payments not described above shall not be considered Compensation if paid after
severance from employment, even if they are paid by the later of 2 months after the date of
severance from employment or the end of the Plan Year that includes the date of severance
from employment, except, payments to an individual who does not currently perform
services for the City by reason of qualified military service (within the meaning of Section
414(u)(1) of the Internal Revenue Code) to the extent these payments do not exceed the
amounts the individual would have received if the individual had continued to perform
services for the City rather than entering qualified military service.
Back pay, within the meaning of Section 1.415(c)- 2(g)(8) of the Income Tax Regulations,
shall be treated as Compensation for the Limitation Year to which the back pay relates to the
extent the back pay represents wages and compensation that would otherwise be included in
this defmition.
If Compensation for any prior determination period is taken into account in determining a
Participant's contributions or benefits for the current Plan Year, the Compensation for such
prior determination period is subject to the applicable annual compensation limit in effect
for that determination period.
5.9 Limitation for Multiple Plans. In the event that any Participant is a
Participant in any other qualified defined contribution plans maintained by the City or any trade or
business under common control with the City during any Limitation Year, the sum of such
Participant's Annual Additions under all such qualified defined contribution plans shall be subject to
the limitation set forth in Section 5.8. Any Excess Amounts which result during a Limitation Year
shall be deemed to have occurred under the City's other qualified defined contribution plans before
being deemed to have resulted from contributions allocated to a Participant's accounts under this
Plan.
5.10 Adjustments to Annual Additions. If in any Limitation year an Excess
Amount should result for any Participant, then such Excess Amount may be corrected in accordance
with the Employee Plans Compliance Resolution System ( "EPCRS ") as set forth in IRS Revenue
Procedure 2006 -27 or any superseding guidance, including but not limited to the Income Tax
Regulations under Section 415 of the Internal Revenue Code.
5.11 Adjustments to Section 415 Limitations. The provisions of Section 5.8, 5.9
and 5.10 are intended to meet the requirements of Section 415 of the Internal Revenue Code, as
13
amended, and such provisions shall by this reference, incorporate any changes made to such Code
section and the Income Tax Regulations thereunder as the same may apply to this Plan.
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ARTICLE VI
Disability
6.1 Disability Benefit. Upon establishing the incurrence of a disability (as
defined below) while in the line of duty, the disabled Participant shall be eligible to receive an
immediate disability pension in the form of an annuity paying monthly benefits equal to fifty
percent (50 %) of Final Average Compensation for the period of disability. Such disability pension
will commence as of the first day of the month following the establishment of the permanent
disability; provided, however, the pension commencement date will be further delayed until all
credit for unused annual or sick leave and other similar credits have been fully paid to the disabled
Police Officer, provided there is no impairment to the Police Officer's regular compensation during
such period of time. A Participant who receives disability benefits will not be entitled to any other
benefits provided by this Plan, and his or her beneficiaries will not be eligible for death benefits
under this Plan unless such disability should end prior to death and the Participant's Retirement
Value had not been fully paid out as a disability pension before such death.
6.2 Definition of and Establishing Permanent Disability. A Participant shall be
considered as having incurred a disability only if it is established upon written proof and
certification provided to the City by a disinterested and duly licensed physician, that the Participant
is completely unable, for reasons of accident or other cause while in the line of duty, to perform the
duties of a Police Officer for the City. The physician conducting any required medical examination
shall be selected or otherwise approved of by the City, and a Participant's failure to submit to any
medical examination ordered by the City for this purpose shall cause the Participant to become
ineligible for a disability pension.
The City may at any time within three years from the commencement of the
disability pension require the disabled Participant to be examined by a physician, at the City's
expense, to determine the continuance of such permanent disability. More than one such
examination may be required by the City. After the expiration of the initial three -year period, a
medical examination can be required only upon order of a Nebraska District Court upon submission
by the City of reasonable grounds to believe that the Police Officer is fraudulently receiving a
disability pension under this Plan.
In the event a Police Officer who received a disability pension hereunder is
determined under the foregoing procedures to be no longer disabled, the disability pension shall
terminate and the Police Officer's Retirement Value, as reduced by the disability pension benefits
theretofore paid from the Plan, shall thereafter be held and administered in the same manner as any
nondisabled Participant or former Participant.
6.3 Temporary Disability. In the event of temporary disability incurred while in
the line of duty, the Participant will receive his or her salary during the continuance of such
disability for a period not to exceed twelve (12) months; provided, however, if it shall be determined
by the City Council or other appropriate municipal authorities of the City within the said twelve (12)
month period that such disability has become a full disability as defined in Section 6.2, then the
15
Participant's salary will cease and the Participant will be entitled to the disability pension benefit
provided by this Article VI.
6.4 Workers' Compensation Benefit. All payments of disability pension benefits
under this Article VI shall be subject to deduction of Workers' Compensation Benefits paid under
Nebraska Workers' Compensation Act, as provided in Section 13.7. If a Participant accepts a lump
sum settlement in lieu of all or part of the periodic benefit payable as Workers' Compensation
Benefits, such periodic payments will, for purposes of determining the monthly disability pension
hereunder, be considered to continue for the applicable number of months by dividing the lump sum
received by the monthly equivalent of such periodic payments, and such equivalent payment will
reduce the monthly disability pension otherwise payable under this Article VI.
6.5 Minimum Disability Retirement Benefits. The actuarial equivalent value of
the disability pension benefit paid hereunder to a disabled Participant, in excess of amounts paid as
Workers' Compensation Benefits, shall not be less than the Participant's Retirement Value at the
date of disability.
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ARTICLE VII
Retirement Benefit
7.1 Election to Retire. Each Participant who elects to retire in accordance with
this Article VII at his or her Normal or Early Retirement Date shall thereupon become entitled to
receive a Retirement Benefit in accordance with Article VIII. In the event a retirement date is not
specified by the Participant, Retirement Benefit payments will commence not later than sixty (60)
days after the close of the Plan Year in which the later of the following occurs: (a) the Participant's
Normal Retirement Date; or (b) the date the Participant terminates employment with the City.
7.2 Normal Retirement Date. The Normal Retirement Date for a Participant
shall be the first day of the month following the Participant's sixtieth (60th) birthday.
7.3 Early Retirement Date. A Participant shall be entitled to elect an Early
Retirement Date upon his or her Termination of Employment on or after attainment of age fifty -
five (55) if such Participant has completed twenty -five (25) years of Service, in which event such
Early Retirement Date shall be the first day of the month coinciding with or next following the date
the Participant terminates employment with the City.
7.4 Deferred Retirement Date. A Participant may continue employment past his
or her Normal Retirement Date on a month to month basis. Any such Participant shall continue to
contribute to his or her employee contribution account, and will be entitled to receive a normal
retirement benefit on the first day of the month following the date employment ceases, computed in
the manner set forth in Article VIII.
7.5 Annuity Commencement Date. Unless elected otherwise by the Participant,
benefits under this Plan will commence as of the Participant's Retirement Date. At any time before
the Retirement Date, a Participant may elect to defer his or her annuity commencement date to the
first day of any specified month prior to attainment of age seventy (70).
17
ARTICLE VIII
Retirement Income Benefits
8.1 Normal Retirement Benefit. The nounal Retirement Benefit payable to a
Participant who retires in accordance with the provisions of Article VII on or after his or her Normal
Retirement Date shall be in the foiui of a straight life annuity paying monthly benefits, such annuity
to be equal to the amount of retirement income that can be purchased or otherwise provided by the
Participant's Retirement Value as of the annuity commencement date elected by the Participant.
8.2 Early Benefit. The early Retirement Benefit payable to a
Participant who retires in accordance with the provisions of Article VII on or after his Early
Retirement Date, but prior to his Normal Retirement Date, shall be in the form of a straight life
annuity paying monthly benefits, such annuity to be equal to the amount of retirement income that
can be purchased or otherwise provided by the Participant's Retirement Value of the annuity
commencement date elected by the Participant.
8.3 Minimum Retirement Benefits. For any Participant employed by the City as
a Police Officer on January 1, 1984, and continuously employed by the City from such date through
the Retirement Date, the monthly Retirement Benefit payable as of the Participant's Retirement Date
shall not be less than the following amounts:
(a) If retirement occurs following age sixty (60) with twenty -five (25) years of
Service with the City, or, following age sixty (60) with twenty -one (21) years of
Service with the City if the Police Officer was hired prior to November 18, 1965,
fifty percent (50 %) of Final Average Compensation.
(b) If retirement occurs following age fifty -five (55) but before age sixty (60)
with twenty -five (25) years of Service with the City, forty percent (40 %) of Final
Average Compensation.
Any Participant entitled to a minimum pension benefit under this Section 8.3 may elect to receive
such benefit in a form other than a straight life annuity as permitted under Section 8.5. Any optional
form of benefit payment shall be the actuarial equivalent of the straight -life annuity that would
otherwise be paid under this Section 8.3. If the optional benefit selected is a lump sum cash
payment, the actuarial equivalent of such form of benefit shall, at the request of the Participant, be
determined by using the average cost for providing the normal form of the minimum pension
benefit under three different paid -up annuity contracts offered by life insurance companies eligible
to sell such contracts in Nebraska; one of the referenced annuity contracts shall be selected by the
Participant, one shall be selected by the Retirement Committee, and one shall be selected by the
City.
8.4 Normal Form of Retirement Income. Unless the Participant has elected an
optional form of annuity under Section 8.5 of this Article VIII, monthly payments will be made to
18
the Participant commencing on his annuity commencement date, if he or she is then living, and
terminating with the payment due prior to his or her death.
8.5 Optional Forms of Retirement Income. In lieu of the normal form of
retirement income provided under Sections 8.3 or 8.4 of this Article VIII, one of the following
optional benefit forms may be selected by the Participant, each of which shall be the actuarial
equivalent of the normal form of benefit:
(a) An annuity for the life of the Participant with a survivor annuity for the life
of the beneficiary selected by the Participant equal to fifty percent (50 %), seventy -
five percent (75 %) or one hundred percent (100 %) of the annuity payable during the
joint lives of the Participant and his or her designated beneficiary;
(b) An annuity for the life of the Participant with monthly payments continuing
to the Participant's designated beneficiary or beneficiaries if the Participant dies
before he or she has received sixty (60), or one hundred twenty (120), or one
hundred eighty (180) monthly payments (whichever option is selected), until the
total number of monthly payments to the Participant and the designated beneficiary
equals the guaranteed period selected by the Participant;
(c)
A single lump sum cash payment; or
(d) Installment or fixed period annuity, which provides for payments over a
specific number of years, with no payments after the completion of such years.
Any optional annuity form of distribution shall be provided through the purchase by
the Plan of an annuity contract from a legal reserve life insurance company with the Participant's
Retirement Value. Any annuity contract purchased by the Plan shall be nontransferable and shall
comply with all applicable requirements of the Plan, including the requirements of
Section 401(a)(9) of the Internal Revenue Code and the Income Tax Regulations thereunder. Upon
the purchase of an annuity contract for the benefit of a Participant and his or her designated
beneficiary and the distribution of such policy to the Participant, all obligations of the Plan to pay
benefits to the Participant and his or her beneficiaries shall terminate, without exception.
The optional benefit form, if desired, must be specified in writing prior to the
Participant's annuity commencement date. The monthly pension payable under any optional
annuity form will be equal to the amount purchased or otherwise provided by the Participant's
Retirement Value.
8.6 Mandatory Lump -Sum Cash -Out. Any Participant whose monthly
Retirement Benefit is less than twenty -five dollars ($25.00) under the normal form of retirement
benefit shall be paid a lump -sum settlement equal to the Participant's Retirement Value and shall not
be entitled to elect any optional benefit form provided under this Plan.
19
8.7 Distributions to Comply with Tax Laws. In all events, the time and method
of distribution of benefits under this Article VIII shall be in accordance with the minimum
distribution rules of Section 13.2 of the Plan as required by Section 401(a)(9) of the Internal
Revenue Code and the Income Tax Regulations promulgated thereunder, and the provisions of
Section 13.2 of the Plan and the requirements of Section 401(a)(9) of the Internal Revenue Code
and such Income Tax Regulations shall supersede any distribution provisions of the Plan which are
inconsistent therewith.
20
ARTICLE IX
Death Benefit
9.1 Death Benefit Prior to Annuity Commencement. If a Participant dies prior
to his or her annuity commencement date (as defined at Section 7.5), and subject to the survivors'
income benefits payable pursuant to Section 9.3, the Participant's beneficiary or beneficiaries, as
provided in Section 9.4, will be entitled to the Participant's entire Retirement Value at the time of
death of the Participant. Except as provided in Section 9.3, the Retirement Value may be received
by the beneficiary in the form of a single lump -sum payment, straight life annuity or any other
optional form of benefit provided under the Plan; provided, however, if the Participant's beneficiary
is not a surviving spouse or a designated beneficiary (as defined at Section 13.2 of the Plan), the
entire Retirement Value of the Participant shall be distributed to such beneficiary by the
December 31 of the calendar year which contains the fifth anniversary of the Participant's death.
The death benefit provided under this Section 9.1 shall be reduced by any payments to a surviving
spouse or minor children pursuant to Section 9.3, if applicable. For a designated beneficiary, the
Retirement Value may be paid over any period not to exceed such designated beneficiary's life
expectancy. If the designated beneficiary is not the Participant's spouse, death benefits will
commence no later than the December 31 of the calendar year following the calendar year of the
Participant's death. If the designated beneficiary is the Participant's spouse, death benefit payments
shall commence no later than the December 31 of the calendar year in which the Participant would
have attained age 70-1/2 had he lived.
9.2 Death Benefit After Annuity Commencement. In the event the Participant
dies after his or her annuity commencement date, the death benefit, if any, will depend on the form
of annuity benefit elected by the Participant. If the annuity benefit was in the form of a straight life
annuity, or a straight annuity having no remaining guaranteed payments at death, the obligation of
the Plan to pay benefits shall terminate on payment of the amount due prior to such Participant's
death. Any excess Retirement Value not paid to the Participant prior to his or her death shall be
retained by the Plan.
9.3 Survivor's Income Benefits.
(a) In the event any active Participant, prior to his or her retirement pursuant to
Article VII, should die while employed by the City but other than in the line of duty,
and where:
(i) the Participant was employed by the City as a Police Officer on
January 1, 1984, or was formerly employed as a Police Officer and
was in military service as of January 1, 1984; and
(ii) the Participant had attained age fifty -five (55) and had completed
twenty -one (21) years of Service with the City as a Police Officer,
21
then a monthly straight life pension benefit equal to twenty -five
percent (25 %) of the Participant's Final Average Compensation at the
time of death shall be paid to the Participant's surviving spouse, if
any, during his or her lifetime, or, following the death of the
surviving spouse, to the minor child or children, if any, of such
Participant during their minority, subject to deduction of the amounts
paid as Workers' Compensation Benefits on account of death in the
same manner as provided in Section 13.7. If there is more than one
minor child eligible to receive benefits hereunder, each such child
shall share equally in the total pension benefit to the age of his or her
majority, and the portion of the pension benefit paid to any such
child will cease upon his or her attainment of the age of majority.
(b) In the event of the death of any Participant prior to retirement while in the
line of duty, or in case death is caused by or is the result of injuries received while in
the line of duty, and if the deceased Participant is survived by a spouse or minor
children, a monthly pension equal to fifty percent (50 %) of the Participant's Final
Average Compensation at the time of death shall be paid to the surviving spouse, or
upon his or her remarriage or death, to the minor child or children during such
child's or children's minority, subject to deduction of the amounts paid as Workers'
Compensation Benefits on account of death in the same manner as provided in
Section 13.7. If there is more than one minor child eligible to receive benefits
hereunder, each such child shall share equally in the total pension benefit to the age
of his or her majority, and the portion of the pension benefit paid to any such child
will cease upon his or her attainment of the age of majority.
(c) To the extent that the Retirement Value at the date of death exceeds the
amount required to purchase or otherwise provide the pension benefit specified
under subsection (a) and (b) above, as reduced by any amounts paid as Workers'
Compensation Benefits, the excess shall be paid to the Participant's beneficiary or
beneficiaries in the manner provided in Section 9.1.
(d) If the deceased Police Officer is not survived by a spouse or minor children,
the death benefits provided by this Section 9.3 shall not be applicable and the death
benefits provided by the Plan shall be limited to those benefits described in
Section 9.1.
(e) In the event any pension benefit is payable to a minor child, such benefit
shall be paid for the benefit of such child to the child's surviving parent or, if there is
no surviving parent, to his or her legal guardian.
22
9.4 Designation of Beneficiary.
(a) By completing and delivering to the Retirement Committee a form provided
for this purpose, a Participant may designate a beneficiary or beneficiaries and
contingent beneficiary or beneficiaries to receive any death benefits payable under
the Plan which are not otherwise required to be paid to a surviving spouse or minor
child. The designation of a beneficiary or contingent beneficiary may be changed at
any time. A designation or change will be effective only if duly executed by the
Participant and received by the Retirement Committee prior to the Participant's
death.
(b) If no beneficiary shall have been designated, or, if no designated beneficiary
shall have survived the Participant, any death benefit (other than mandatory survivor
benefits) shall be paid to the deceased Participant's estate in the form determined by
the Retirement Committee.
9.5 Purchase of Annuity Contracts. Any annuity form of distribution under this
Article IX may be provided through the purchase by the Plan of an annuity contract from a legal
reserve life insurance company with the Participant's Retirement Value. Any annuity contract
purchased by the Plan shall be nontransferable and comply with all applicable requirements of the
Plan, including the requirements of Section 401(a)(9) of the Internal Revenue Code. Upon the
purchase of an annuity contract and the distribution thereof to the beneficiary or beneficiaries
entitled to the benefit provided thereunder, all obligations of the Plan to pay benefits to such
beneficiary or beneficiaries shall terminate, without exception.
9.6 Distributions to Comely With Tax Laws. In all events, the time and method
of distribution of benefits under this Article IX shall be in accordance with the minimum
distribution rules of Section 13.2 of the Plan as required by Section 401(a)(9) of the Internal
Revenue Code and the Income Tax Regulations promulgated thereunder, and the provisions of
Section 13.2 of the Plan and the requirements of Section 401(a)(9) of the Internal Revenue Code
and such Income Tax Regulations shall supersede any distribution provisions of the Plan which are
inconsistent therewith.
23
ARTICLE X
Distribution of Benefits Upon Termination of Employment
10.1 Termination Benefit. A Participant who terminates employment prior to
becoming eligible for retirement or death or disability benefits under this Plan will be entitled to a
termination benefit in accordance with this Article X and will not be entitled to any other benefits
provided by this Plan.
10.2 Termination Benefit Payment Option. By providing written notification to
the Retirement Committee, the Participant may: (a) elect to receive the accumulated value of his or
her employee contribution account in the form of an immediate lump sum distribution with the
vested portion of such Participant's employer contribution account, if any, to remain in the Pension
Fund to provide a deferred retirement annuity; or (b) elect to leave all or a portion of the
accumulated value of his or her employee contribution account, together with the vested portion of
his or her employer contribution account, if any, in the Pension Fund to provide a deferred
retirement annuity; or (c) elect to receive the accumulated value of his or her employee contribution
account and the vested portion of his or her employer account in a single lump sum distribution. In
the event a lump sum distribution of all or a portion of the employee account is made upon
Termination of Employment, the Participant's Retirement Value shall be reduced by the amount of
the lump sum distribution. In the event a lump sum distribution of the entire vested Retirement
Value is made pursuant to (c) above, all obligations of the Plan and the City to provide benefits to
the terminated Police Officer and his or her beneficiaries shall terminate, without exception.
10.3 Vesting Percentage. The vesting percentage applicable to the Participant's
employer contribution account upon Termination of Employment shall be forty percent (40 %) after
the completion of four complete years of Service (as defined in Section 4.1), increasing by ten
percent (10 %) for each additional completed year of Service, up to one hundred percent (100 %)
after the completion of ten (10) complete years of Service. Notwithstanding the foregoing, a Police
Officer who attains age sixty (60) while in the employ of the City shall be one hundred percent
(100 %) vested in the amounts credited to his employer contribution account. The nonvested portion
of a Participant's employer contribution account shall be forfeited upon Termination of Employment
and accordingly reduce the Participant's Retirement Value under the Plan by the amount so
forfeited.
10.4 Payment of Deferred Retirement Annuity. If the terminated Participant has
not elected a lump sum payment of the entire vested Retirement Value upon his or her Termination
of Employment, the Retirement Value held under the Plan for the terminated Participant (as reduced
by any forfeitures and lump sum distributions made from the employee contribution account) shall
be applied to purchase or otherwise provide a Retirement Benefit as of the first day of the month
following the terminated Participant's sixtieth (60th) birthday. By providing prior written
notification to the Retirement Committee, the terminated Participant may elect an earlier
commencement of his or her Retirement Benefit beginning as of the first day of any month
following the terminated Participant's fifty -fifth birthday. The form of payment shall be any
optional benefit foiiu permitted by this Plan and selected by the Participant.
24
10.5 Involuntary Cash -Outs of Small Accounts. Notwithstanding the foregoing
provisions, if a Participant's vested Retirement Value at the time of his Termination of Employment
is not greater than $1,000, the Trustee shall distribute such vested Retirement Value to the
terminated Participant, and such distribution shall satisfy all obligations of the Plan and the City to
the Participant and his or her beneficiaries, without exception.
In no event shall an involuntary distribution greater than $1,000 be made in
accordance with the provisions of this Plan if the Participant has not elected to have such
distribution paid directly to an eligible retirement plan specified by the Participant in a direct
rollover or to receive the distribution directly, unless the Trustee pays the distribution in the fowl of
a direct rollover to an individual retirement plan designated by the Retirement Committee.
10.6 Forfeitures. Forfeitures of the non - vested portion of a terminating
Participant's employer contribution account shall be applied to first meet the expenses incurred in
connection with the administration of the Plan, with the excess, if any, applied to reduce the City
contributions which would otherwise be required to fund Plan benefits.
10.7 Distributions to Comply With the Tax Laws. In all events, the time and
method of distribution of benefits under this Article X shall be in accordance with the minimum
distribution rules of Section 13.2 of the Plan as required by Section 401(a)(9) of the Internal
Revenue Code and the Income Tax Regulations promulgated thereunder, and the provisions of
Section 13.2 of the Plan and the requirements of Section 401(a)(9) of the Internal Revenue Code
and such Income Tax Regulations shall supersede any distribution provisions of the Plan which are
inconsistent therewith.
25
ARTICLE XI
Administration
11.1 Establishment of Retirement Committee. A Retirement Committee shall be
established to supervise the general operation of the Plan; provided, however, the City shall be
responsible for the general administration of the Plan except for such specific administrative
functions which are delegated, by ordinance or statute, to the Retirement Committee.
11.2 Retirement Committee Members. The Retirement Committee shall include
members from both the police force and designees of the City. The Retirement Committee shall
consist of six members of which four members shall be elected by the officers of the police force of
the City, and two members shall be designated by the City Council. The members who are not Plan
Participants shall have a general knowledge of retirement plans as a condition to appointment as a
member. Members of the governing body of the City may serve on the Retirement Committee.
Retirement Committee members shall be appointed to four -year terms. Vacancies shall be filled for
the remainder of the term by a person with the same representation as his or her predecessor.
Members of the Retirement Committee shall receive no salary and shall not be compensated for
expenses. The Retirement Committee shall appoint a chairman from among its members who shall
be authorized to execute any document on behalf of the Retirement Committee.
11.3 Specific Duties of the Retirement Committee. It shall be the duty of the
Retirement Committee to:
(a) Provide each Participant a summary of Plan eligibility requirements and
benefit provisions.
(b) Provide, within thirty days after a request is made by a Participant, a
statement describing the amount of benefits such Participant is eligible to receive.
(c) Make available for review an annual report of the Plan's operations
describing both:
(i) the amount of contributions to the Plan from both employee and
employer sources and
(ii) an identification of the total assets of the Plan and pension
system.
(d) Beginning December 31, 1998, and as of each December 31 thereafter, file
an annual report with the Nebraska Public Employees Retirement Board and copies
thereof with the Nebraska Retirement Systems Committee of the Nebraska
legislature in such form and disclosing such information as prescribed by the
Nebraska Public Employees Retirement Board.
26
11.4 General Powers and Duties. The City and Retirement Committee shall have
such general duties and powers as may be necessary to discharge their specific duties and to
administrate the Plan, including, but not limited to, the following:
(a) To determine eligibility;
(b) To determine all questions of fact as to age, years of Service, Compensation,
Termination of Employment, Normal and Early Retirement Dates, contribution
amounts, and similar items based upon Plan records;
(c) To adopt rules of procedure and regulations necessary for the proper and
efficient administration of the Plan;
(d) To determine all questions arising in the interpretation of the Plan, including
the amount and timing of benefit payments from the Plan and all such
determinations shall be conclusive and binding on all persons to the extent provided
by law;
(e) To correct any underpaid or overpaid benefit from the Plan, including the
power to order an offset or adjustment of future benefit payments to recover any
such overpayment; and
(f) To all things necessary or proper pursuant to the duty of administering the
Plan and supervising its operations.
All administrative powers necessary to operate the Plan shall be vested exclusively with the City
unless otherwise specifically provided by this Plan or delegated by ordinance to the Retirement
Committee.
11.5 Power to Make Adjustments and Corrections. The City and Retirement
Committee shall have the power and authority to make such equitable adjustments to the accounts
and benefits of any Participant to correct any mathematical or accounting errors or any mistakes that
may arise by reason of factual errors in information supplied to the City, Retirement Committee or
Trustee. The City and Retirement Committee may also take appropriate action to correct errors in
the administration or operation of the Plan as deemed necessary or appropriate to preserve the tax
qualification of the Plan under Section 401(a) of the Internal Revenue Code, including the power
and authority to correct operational errors and defects pursuant to any correction action as may be
authorized under the Internal Revenue Service Employee Plans Compliance Resolution System
( "EPCRS "), or any successor program to EPCRS. Such corrective actions may include causing
appropriate distributions to be made to a participant from the Plan, to the extent such distribution is
made to correct a qualification effect or as may otherwise be required or authorized under the
EPCRS.
11.6 Use of Alternative Media. The City, Retirement Committee and Trustee
may use telephonic or electronic media to satisfy any administrative duty or notice requirements
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required by this Plan, to the extent permissible under the Code or Income Tax Regulations (or other
generally applicable guidance). The City, Retirement Committee and Trustee may also use
telephonic or electronic media to conduct Plan transactions, such as enrolling Participants, electing
and changing investment allocations, and other Plan transactions to the extent permissible under the
Internal Revenue Code or the Income Tax Regulations.
11.7 Uniform Administration. Whenever, in the administration of the Plan, any
action by the Retirement Committee of the City is required, such action shall be uniform in nature
as applied to all persons and Participants similarly situated.
11.8 Liability Limited. In administering the Plan neither the Retirement
Committee, nor the City Council, nor any member thereof, nor the City and its officers and
employees, or any Police Officer thereof, or any financial institution with which the Retirement
Committee contracts, shall be liable for any acts of omission or commission, except for his or its
own individual, willful, and intentional malfeasance or misfeasance. In its administration of the
Plan, the City, and its officers and directors, and the Retirement Committee, shall be entitled to rely
conclusively on all tables, valuations, certificates, opinions, and reports which shall be furnished by
any actuary, accountant, trustee, insurance company, counsel, or other expert who shall be
employed or engaged by the City or the Retirement Committee.
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ARTICLE XII
Pension Fund
12.1 Pension Fund. This Plan and Trust creates and establishes a Pension Fund
which shall be the Police Officers' Retirement System Fund required to be kept and maintained by
the City pursuant to Section 16- 1004(2) of the Nebraska Revised Statutes. All contributions of the
City and Participants hereunder shall be paid to the Trustee and held and administered by the
Trustee (to the extent custody of Plan assets is not held by others pursuant to Section 12.2 of the
Plan) as a single trust fund.
12.2 Plan Investments. Investment of the Pension Fund shall be under the general
direction of the Retirement Committee. The City, on behalf of the Plan, may contract with an
insurance company, trust company, or other investment manager registered under the Investment
Advisers Act of 1940 to invest and reinvest such portion of the Pension Fund as may be assigned by
the City. Investment of the Pension Fund may be made without distinction between principal and
income. Such investment contracts may also extend to the establishment, maintenance and
management of any segregated investment fund established pursuant to Section 12.3 of the Plan.
Such financial institutions shall under no circumstances be deemed a party to this Plan for any
purpose or have any responsibility for the validity or tax qualification of this Plan. The Pension
Fund shall be invested pursuant to the policies established by the Nebraska Investment Council.
The powers, duties, and responsibilities of any financial institution contracting to invest and reinvest
the Pension Fund shall be limited to those powers, duties and responsibilities set forth in the
contract with the City or Trustee, and the liability of such financial institution shall not exceed or
extend to any matter not otherwise specified in such contract. Such financial institution may, to the
extent necessary or proper under the contract, have custody of the assets of the Pension Fund. The
City, the Retirement Committee, the Trustee and the City Council, its members, and all officers and
employees of the City shall have no liability or responsibility with regard to the investment
performance of the portion of the Pension Fund under management by such financial institutions.
12.3 Directed Investments. Effective September 1, 2001, the Trustee shall cause
to be established and maintain at least five (5) funds for the investment of all Trust funds as follows:
(a) an Equity Fund, in which sums received for investment in such fund shall be
invested in a diversified portfolio or portfolios of common stocks, or securities convertible
into common stocks, with a view to both income and opportunity of growth in principal
value;
(b) a Bond Fund, in which sums received for investment in such fund shall be invested
in a diversified portfolio or portfolios of interest - bearing bonds, commercial paper, bankers'
acceptances, or debt securities;
(c) a Short-Term Interest Fund in which sums received for investment in such fund shall
be invested in a diversified portfolio or portfolios of short-term interest bearing notes,
29
commercial paper or deposits, including certificates of deposit, bankers' acceptances,
repurchase agreements, and other similar interest - bearing or fixed - income investments;
(d) a Diversified Fund in which sums received for investment in such fund shall be
invested in a diversified portfolio or portfolios of both equity and interest - bearing securities,
including stocks, bonds, mortgages, money market funds, fixed - income securities, and any
other investment medium as the Trustee may deem advisable from time to time; and
(e) an International Fund in which sums received for investment in such fund shall be
invested in a diversified portfolio or portfolios of both equity and interest - bearing securities,
including stocks and bonds and money market instruments, on a global basis, with an
objective of long -term capital growth and current income.
The foregoing Funds shall be maintained and administered solely by the Trustee,
and investments or reinvestments of each Fund shall be made by the Trustee without distinction
between principal and income. The Trustee shall invest and administer such Funds in accordance
with the investment guidelines for each Fund, but shall otherwise be authorized to invest in such
particular investments, within the United States, as the Trustee may deem advisable, provided such
investments are authorized for trustees under the laws of the State of Nebraska. The Funds may be
invested wholly or partly through (i) the purchase of shares in a mutual fund or funds; or (ii) the
medium of any common, collective, or commingled trust fund maintained by a bank or other
financial institution (including the Trustee) and which is qualified under Section 401(a) and 501(a)
of the Internal Revenue Code, to constitute a part of this Plan and Trust.
The Trustee may, in its discretion, hold in cash such portion of any Fund as shall be
reasonable under the circumstances, pending investment or payment of expenses or distribution of
benefits, without liability for interest; or, in the alternative, all of such temporary cash positions may
be held in interest - bearing deposits of any bank or financial institution (to include the Trustee).
12.4 Chance in Investment Direction. Subject to such reasonable and non-
discriminatory rules, limits, and procedures as the Trustee and Employer may establish, each
Participant shall determine the manner in which contributions allocated to his Plan accounts,
including all earnings and gains thereon, are to be invested and reinvested among the Funds
established in Section 12.3 of the Plan, by providing specific written directions to the Plan
Administrator and Trustee in the manner required by the Plan Administrator.
Such investment direction shall specify the percentage (in multiples of 5 percent) of
all contributions which are made on the Participant's behalf under the Plan that shall be invested in
the Funds, or any single Fund. Unless an effective investment is made by the Participant, all Plan
accounts for such Participant shall be invested in the Short-Term Interest Fund.
Any investment direction given by a Participant shall be deemed a continuing
direction until changed. A Participant may change an investment direction as to future
contributions, as of January 1, April 1, July 1 or October 1 (the "Change Date ") of any Plan Year,
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by filing a written notice of such change in investment direction with the Plan Administrator at least
thirty (30) days prior to the Change Date.
A Participant may also direct as of such Change Date that all, or any multiple of 5
percent, of his interest in one or more of the Funds be liquidated and the proceeds thereof
transferred to another Fund or Funds, in one lump sum, as of any Change Date, provided such
direction is given in writing to the Plan Administrator at least thirty (30) days prior to the Change
Date. All Fund liquidations shall be based upon the Fund valuations as of the valuation date
immediately preceding the Change Date.
12.5 Fund Gains and Expenses. All dividends, gains, income, interest, and
distributions of every nature received in respect of the assets held by a particular Fund shall be
credited solely to such Fund and shall be reinvested in the investment assets of the Fund from which
the earnings were derived. All losses attributable to a Fund shall be debited to such Fund alone, and
shall accordingly be borne by and payable proportionately from those Participant accounts which
are invested in such Fund. Unless paid by the Employer, the expenses of a particular Fund, such as
commissions, transfer taxes, management fees, and other related investment expenses, shall be
charged and debited to such Fund.
12.6 Investment Advisers. The Employer shall have the power to appoint or
remove one or more investment advisers and to delegate to such adviser authority and discretion to
manage the assets of the Trust Fund or of any Fund established pursuant to Section 12.3 of the Plan;
provided that (i) such adviser is either a bank, an insurance company, or a registered investment
adviser under the Investment Advisers Act of 1940 and shall acknowledge in writing that it is a
fiduciary to the Plan; and (ii) the Employer shall periodically review the investment performance
and methods of each such adviser.
12.7 Liability of Fiduciary. No person who is a fiduciary to this Plan, including
the Trustee, shall be liable hereunder for any loss, or by reason of any breach, which results from a
Participant's direction that his Plan accounts be invested in the Funds established hereunder.
12.8 Regulated Investment Company Mutual Funds. Notwithstanding the
provisions of Section 12.3 of the Plan above, the Employer may direct that any or all of the Funds
established under Section 12.3 of the Plan consist of one or more mutual funds sponsored by a
regulated investment company selected by the Employer. In the event such mutual funds are
selected by the Employer, the Trustee shall not be liable for any loss, or by reason of any breach,
associated or in any way connected with the Employer's selection and retention of any mutual fund
as an investment medium for the Plan.
12.9 Trustee Powers and Duties. The Trustee shall act as official custodian of the
cash, securities, and other assets of the Pension Fund not in the custody of the financial institution
under contract to invest the Pension Fund or under agreement to safekeep Plan assets, including any
investment funds established pursuant to Section 12.3 of the Plan, and shall provide or make
arrangements for adequate safe deposit facilities for the preservation of such assets subject to the
direction of the Retirement Committee, and shall receive all contributions made to the Plan and
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provide for all transfers of cash and money necessary for investment of the Pension Fund; provided,
however. the payment of any money to Participants, beneficiaries, or for the expenses of the Plan
shall be payable only upon the direction of the Trustee and all deposit and withdrawal agreements
with outside financial institutions handling Plan assets shall require that Plan assets and moneys
may be withdrawn only upon the direction of the Trustee. The Trustee shall keep and maintain
adequate records of the investments of the Pension Fund and shall be responsible for maintaining
the employer and employee contribution accounts pursuant to Section 5.1 of the Plan. The Trustee
shall, to the extent required by the City or Retirement Committee, furnish a surety bond payable to
the Plan and /or City in such amount as may be acceptable to the City insuring his/her duties and
responsibilities hereunder. The cost of any such bond shall be paid by the City. The Trustee shall
assist the Retirement Committee in the preparation of all reports and documents required under
Sections 16 -1001 to 1019, Nebraska Revised Statutes or as otherwise required in administering the
Plan, but shall have no further duty to account or report except as may be specifically required by
law.
12.10 Insurance Contracts. In no event shall the City, the Retirement Committee,
the Plan, the Trustee, or the City Council, and their respective members, officers and employees, or
any other person, be responsible for the validity of any insurance or annuity contract which may be
held as part of the Pension Fund or which is purchased by the Plan and distributed to a Participant as
beneficiary to provide benefits hereunder, or for the failure on the part of any insurer to make
payments or provide benefits under any such contract, or for any inability to perform or for any
delay in performing, any act occasioned by any restriction or provision of any insurance or annuity
contract or by the insurer or any other person or entity.
12.11 City Treasurer as Trustee. The duly elected or appointed City Treasurer
shall serve as the Trustee of the Plan at all times. In the event of the election or appointment of
another person as City Treasurer, such person shall automatically succeed to the office of Trustee as
of the date he or she takes office, and the prior City Treasurer shall thereupon be discharged and
removed as Trustee.
12.12 Expenses. Subject to Section 12.5 of the Plan, all expenses of the Plan and
Trust; other than direct transaction expenses (such as brokerage costs for the investment of Plan
assets) shall be paid by the City; provided, however, funds from the forfeiture of employer
contribution accounts in any Plan Year shall be applied to the payment of Plan expenses incurred by
the City for such year before being credited against the City's contribution obligations pursuant to
Section 10.6 of the Plan. Any Plan expenses not paid by the City shall be reimbursed out of the
Pension Fund. All taxes of any kind or description which may be assessed against or in respect of
the Pension Fund shall be paid from the Trust.
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ARTICLE XIII
Miscellaneous Provisions
13.1 Non - Alienation of Benefits. None of the benefits payable under the Plan
will be subject to execution, garnishment, attachment or assignment under the bankruptcy laws, or
otherwise be subject to the claims of any creditor of any Participant, beneficiary, spouse or
contingent annuitant, nor will any Participant, beneficiary, spouse or contingent annuitant have any
right to alienate, anticipate, commute, pledge, encumber or assign such benefits. Notwithstanding
the foregoing, the Plan may comply with any directions set forth in a qualified domestic relations
order meeting the requirements of Section 414(p) of the Internal Revenue Code (to be applied as if
Section 414(p) of the Internal Revenue Code is fully applicable to this Plan); provided, however, no
benefits will be paid, assigned, or set aside for any person unless and until the Plan has received
such releases and benefit waivers from the Participant or any other person as the City or Retirement
Committee may deem necessary or appropriate to protect the Plan and the City from any claims
which may arise as a result of the Plan complying with the provisions of any qualified domestic
relations order. In no event shall the Plan recognize any domestic relations order which alters,
changes or provides for a form of benefit not otherwise provided for under the Plan, increases
benefits not otherwise provided by the Plan, or accelerates or defers the time of payment of Plan
benefits, except to the limited extent allowed under Section 414(0(4) of the Internal Revenue Code.
The Retirement Committee shall establish procedures in accordance with Section
414(p) of the Internal Revenue Code for determining the qualified status of a domestic relations
order served upon the Plan. The City and the Retirement Committee shall follow all applicable
procedures set forth in Sections 414(p) of the Internal Revenue Code which apply when a domestic
relations order is received, including issuing appropriate instructions to the Trustee or other funding
agent with respect to segregating amounts in separate accounts pending the resolution of all matters
relating to the domestic relations order and the distribution of Plan benefits with respect thereto.
13.2 Minimum Distribution Reauirements. All distributions of benefits under the
Plan shall be subject to and made in accordance with the following minimum distribution rules
under Section 401(a)(9) of the Internal Revenue Code and the Income Tax Regulations thereunder,
and in accordance with the minimum incidental benefit requirement of Section 401(a)(9)(G) of the
Internal Revenue Code.
(a) Time and Manner of Distribution.
(1) Required Distribution Date. The Participant's entire interest in the Plan will
be distributed, or begin to be distributed, to the Participant no later than the
Participant's Required Distribution Date.
(2) Death of Participant Before Distributions Begin. If the Participant dies
before distributions begin, the Participant's entire interest will be distributed, or
begin to be distributed, no later than as follows:
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(A) If the Participant's surviving spouse is the Participant's sole
Designated Beneficiary, then distributions to the surviving spouse will begin
by December 31 of the calendar year immediately following the calendar
year in which the Participant died, or by December 31 of the calendar year in
which the Participant would have attained age 70'/2, if later.
(B) If the Participant's surviving spouse is not the Participant's sole
Designated Beneficiary, then distributions to the Designated Beneficiary will
begin by December 31 of the calendar year immediately following the
calendar year in which the Participant died.
(C) If there is no Designated Beneficiary as of September 30 of the year
following the year of the Participant's death, the Participant's entire interest
will be distributed by December 31 of the calendar year containing the fifth
anniversary of the Participant's death.
(D) If the Participant's surviving spouse is the Participant's sole
Designated Beneficiary and the surviving spouse dies after the Participant
but before distributions to the surviving spouse begin, this subparagraph
(a)(2), other than subparagraph (a)(2)(A) above, will apply as if the surviving
spouse were the Participant.
For purposes of this subparagraph (a)(2) and subsection (c), unless
subparagraph (a)(2)(D) applies, distributions are considered to begin on the
Participant's Required Distribution Date. If subparagraph (a)(2)(D) applies,
distributions are considered to begin on the date distributions are required to
begin to the surviving spouse under subparagraph (a)(2)(A) above. If
distributions under an annuity purchased from an insurance company
irrevocably commence to the Participant before the Participant's Required
Distribution Date (or to the Participant's surviving spouse before the date
distributions are required to begin to the surviving spouse under
subparagraph (a)(2)(A) above), the date distributions are considered to begin
is the date distributions actually commence.
(3) Forms of Distribution. Unless the Participant's interest is distributed in the
form of an annuity purchased from an insurance company or in a single sum on or
before the Required Distribution Date, as of the first Distribution Calendar Year
distributions will be made in accordance with subsections (b) and (c). If the
Participant's interest is distributed in the form of an annuity purchased from an
insurance company, distributions thereunder will be made in accordance with the
requirements of Section 401(a)(9) of the Internal Revenue Code and the Regulations
thereunder.
(b) Required Minimum Distributions During Participant's Lifetime.
34
(1) Amount of Required Minimum Distribution for Each Distribution Calendar
Year. During the Participant's lifetime, the minimum amount that will be distributed
for each Distribution Calendar Year is the lesser of:
(A) the quotient obtained by dividing the Participant's Accrued Benefit
by the distribution period in the Uniform Lifetime Table set forth in Section
1.401(a)(9) -9 of the Income Tax Regulations, using the Participant's age as
of the Participant's birthday in the Distribution Calendar Year; or
(B) if the Participant's sole Designated Beneficiary for the Distribution
Calendar Year is the Participant's spouse, the quotient obtained by dividing
the Participant's Accrued Benefit by he number in the Joint and Last
Survivor Table set forth in Section 1.401(a)(9) -9 of the Income Tax
Regulations, using the Participant's and spouse's attained ages as of the
Participant's and spouse's birthdays in the Distribution Calendar Year.
(2) Lifetime Required Minimum Distributions Continue Through Year of
Participant's Death. Required minimum distributions will be determined under this
subsection (b) beginning with the first Distribution Calendar Year and up to and
including the Distribution Calendar Year that includes the Participant's date of death.
(c) Required Minimum Distributions After Participant's Death.
(1) Death On or After Date Distributions Begin.
(A) Participant Survived by Designated Beneficiary. If the Participant
dies on or after the date distributions begin and there is a Designated
Beneficiary, the minimum amount that will be distributed for each
Distribution Calendar Year after the year of the Participant's death is the
quotient obtained by dividing the Participant's Accrued Benefit by the longer
of the remaining life expectancy of the Participant or the remaining life
expectancy of the Participant's Designated Beneficiary, determined as
follows:
(I) The Participant's remaining life expectancy is calculated
using the age of the Participant in the year of death, reduced by one
for each subsequent calendar year.
(II) If the Participant's surviving spouse is the Participant's sole
Designated Beneficiary, the remaining life expectancy of the
surviving spouse is calculated for each Distribution Calendar Year
after the year of the Participant's death using the surviving spouse's
age as of the spouse's birthday in that year. For Distribution
Calendar Years after the year of the surviving spouse's death, the
remaining life expectancy of the surviving spouse is calculated using
35
the age of the surviving spouse as of the spouse's birthday in the
calendar year of the spouse's death, reduced by one for each
subsequent calendar year.
(III) If the Participant's surviving spouse is not the Participant's
sole Designated Beneficiary, the Designated Beneficiary's remaining
life expectancy is calculated using the age of the Beneficiary in the
year following the year of the Participant's death, reduced by one for
each subsequent calendar year.
(B) No Designated Beneficiary. If the Participant dies on or after the
date distributions begin and there is no Designated Beneficiary as of
September 30 of the year after the year of the Participant's death, the
minimum amount that will be distributed for each Distribution Calendar
Year after the year of the Participant's death is the quotient obtained by
dividing the Participant's Accrued Benefit by the Participant's remaining life
expectancy calculated using the age of the Participant in the year of death,
reduced by one for each subsequent calendar year.
(2) Death Before Date Distributions Begin.
(A) Participant Survived by Designated Beneficiary. If the Participant
dies before the date distributions begin and there is a Designated
Beneficiary, the minimum amount that will be distributed for each
Distribution Calendar Year after the year of the Participant's death is the
quotient obtained by dividing the Participant's Accrued Benefit by the
remaining life expectancy of the Participant's Designated Beneficiary,
determined as provided in subsection (c)(1).
(B) No Designated Beneficiary. If the Participant dies before the date
distributions begin and there is no Designated Beneficiary as of September
30 of the year following the year of the Participant's death, distribution of the
Participant's entire interest will be completed by December 31 of the
calendar year containing the fifth anniversary of the Participant's death.
(C) Death of Surviving Spouse Before Distributions to Surviving Spouse
Are Required to Begin. If the Participant dies before the date distributions
begin, and the Participant's surviving spouse is the Participant's sole
Designated Beneficiary, and the surviving spouse dies before distributions
are required to begin to the surviving spouse under subsection (c)(1), this
subsection (c)(2) will apply as if the surviving spouse were the Participant.
(4) Definitions. For purposes of this Section 13.2 of the Plan, the following
terms shall have the following meaning:
(A) Designated Beneficiary. The individual who is designated as the
Beneficiary under Section 9.4 of the Plan other than the estate of the
Participant and who also qualifies as a designated beneficiary under Section
401(a)(9) of the Internal Revenue Code and Section 1.401(a)(9) -1, Q &A 4 of
the Income Tax Regulations.
(B) Distribution Calendar Year. A calendar year for which a minimum
distribution is required. The required minimum distribution for the
Participant's first Distribution Calendar Year will be made on or before the
Participant's Required Distribution Date. The required minimum distribution
for other Distribution Calendar Years, including the required minimum
distribution for the Distribution Calendar Year in which the Participant's
Required Distribution Date occurs, will be made on or before December 31
of that Distribution Calendar Year.
(C) Life Expectancy. Life expectancy as computed by use of the Single
Life Table in Section 1.401(a)(9) -9 of the Income Tax Regulations.
(D) Participant's Accrued Benefit. The Participant's combined accounts
under the Plan as of the last valuation date in the calendar year immediately
preceding the Distribution Calendar Year (valuation calendar year) increased
by the amount of any contributions made and allocated or forfeitures
allocated to the combined accounts of the Participant as of dates in the
valuation calendar year after the valuation date and decreased by
distributions made in the valuation calendar year after the valuation date.
The Accrued Benefit for the valuation calendar year includes any amounts
transferred to the Plan either in the valuation calendar year or the
Distribution Calendar Year if distributed or transferred in the valuation
calendar year.
(E) Required Distribution Date. The Required Distribution Date of a
Participant is the April 1 following the later of (i) the calendar year in which
the Participant attains age 70 or (ii) the calendar year in which the
Participant retires.
13.3 Plan Not a Contract of Employment. The Plan shall not be deemed to
constitute a contract between the City and any Police Officer, or to be a consideration for the
employment of any Police Officer. Nothing in the Plan shall give any Police Officer the right to be
retained in the employ of the City; all Police Officers shall remain subject to discharge, discipline or
lay -off to the same extent as if the Plan had not been put into effect.
37
Contribution.
13.4 Modification or Discontinuance of the Plan or Complete Discontinuance of
(a) The City expects and intends to maintain the Plan in force indefinitely, but
necessarily reserves the right to amend, suspend or terminate the Plan at any times as
may be required or permitted under the applicable Nebraska Statutes.
(b) Prior to the satisfaction of all liabilities with respect to Participants, joint
annuitants and beneficiaries under the Plan, no change shall be made which shall
result in any portion of the Pension Fund being used for other than the exclusive
benefit of such persons.
13.5 Vesting and Allocation of Pension Fund on Termination of Plan or Complete
Discontinuance of Contributions. In the event that either the Plan shall be terminated, or there shall
be a complete discontinuance of City contributions, the Retirement Value of each Plan Participant to
the date of such termination or discontinuance shall be fully vested to the extent then funded. The
assets then remaining in the Pension Fund shall be applied in the following order, all persons in each
order of priority being entitled to their perspective proportionate share before proceeding in the
order of priority next following:
(a) Provision to Participants whose retirement income has commenced and their
joint annuitants and beneficiaries of any benefits to which they shall be entitled or
contingently entitled under the Plan;
(b) Provision to retired Participants whose retirement income has not
commenced and to their joint annuitants and beneficiaries and to disabled
Participants of any benefits to which they shall be entitled or contingently entitled
under the Plan.
(c) Provision to Participants who shall at that time be entitled to retire normally,
and to their joint annuitants and beneficiaries, of the benefits to which they shall be
entitled or contingently entitled under the Plan;
(d) Provision to Participants who would at that time with the consent of the Plan
Administrator be entitled to retire early, and to their joint annuitants and
beneficiaries, of the benefits to which they shall be entitled or contingently entitled
under the Plan;
(e) Provisions to all other Participants and their joint annuitants and
beneficiaries of the accrued benefits to which they shall be entitled or contingently
entitled under the Plan. For purposes of this subdivision, accrued benefits shall be
calculated at the date of termination of the Plan or complete discontinuance of
contributions;
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(f) Any surplus remaining in the Pension Fund, after the satisfaction of all
benefit rights or contingent rights accrued under the Plan, shall, subject to the
pertinent provisions of federal or state law, be returned to the City.
13.6 Qualification of Plan. The City reserves the right to make such amendments
to this Plan, if any, as will be required to enable this Plan to qualify for tax purposes under Section
401(a) of the Internal Revenue Code as a tax - qualified plan.
13.7 Workers' Compensation Benefits. Notwithstanding any other provisions of
the Plan, no Participant shall be entitled during any period of disability to receive in full, both
benefits under this Plan provided by the Participant's Retirement Value and additional benefits
under the Nebraska Workers' Compensation Act. Similarly, beneficiaries shall not be entitled to
receive, in full, both death benefits under this Plan and additional benefits under the Nebraska
Workers' Compensation Act. All Nebraska Workers' Compensation Act benefits shall be payable in
full to such Participant or his or her dependents as provided in such Act, but all amounts paid by the
City or its insurer under said Act, to any disabled Participant entitled to receive a salary during such
disability, or to the surviving spouse or children of any deceased Participant, shall be considered as
payments on account of such salary and shall be credited against the benefits provided hereunder.
The remaining balance of such benefits, if any, shall be payable as otherwise provided under this
Plan. In the event a lump sum benefit or settlement is paid in lieu of a periodic benefit under the
Nebraska Workers' Compensation Act, such payment will, for the purposes of determining the
benefit paid from this Plan, be converted to a periodic benefit on an actuarially equivalent basis and
such equivalent periodic payment will reduce the monthly benefit payment otherwise payable under
this Plan in the event of disability or death.
13.8 Merger or Consolidation. No merger or consolidation of this Plan with (or
transfer of assets or liabilities to) any other plan shall be effective unless the benefit to which each
Participant subsequent to the merger, consolidation, or transfer would be entitled in the event of that
successor plan immediate termination is at least equal to, or greater than, the benefit to which the
Participant would have been entitled under this Plan had it terminated immediately before the
merger, consolidation or transfer.
13.9 Tax Withholding. The Trustee shall withhold from the benefit payments to
be made to any recipient under this Plan such taxes as may be required to be withheld by applicable
state and federal tax laws, and such withheld taxes shall be promptly remitted to the proper
governmental authority.
13.10 Invalidity of Certain Provisions. If any provision of this Plan shall be held
invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision
hereof, and this Plan shall be construed and enforced as if such provision had not been included.
13.11 Additional Limitations. In case it becomes impossible to perfoun any act
under this Plan, that act shall be performed which, in the judgment of the City, will most nearly
carry out the intent and purposes of this Plan, and all parties to this Plan or in any way interested
shall be bound by any acts performed under such conditions.
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13.12 Compliance with Internal Revenue Code. Notwithstanding anything herein
to the contrary, the Plan shall be administered in a manner necessary to comply with all tax -
qualification requirements applicable to government retirement plans under Section 401(a) of the
Internal Revenue Code, as the same may be amended, and all provisions of this Plan shall be
construed in accordance with such qualification requirements and shall, by this reference,
incorporate any subsequent changes made to such qualification requirements as the same may apply
to this Plan.
13.13 Counterparts. This Plan and Trust may be executed in two or more
counterparts, any one of which will be an original without reference to the other.
13.14 Plan Construed as a Whole. The provisions of the Plan shall be construed as
a whole in such manner as to carry out the provisions of the Plan and shall not be construed
separately without relation to the context.
IN WITNESS WHEREOF, the City of Blair, Nebraska, has caused this amendment
and restatement of the Plan and Trust to be executed by its duly authorized city officer and the
Trustee has executed this amendment and restatement of the Plan and Trust this day of
Ak,f, 0 , 2003, effective as of January 1, 2008.
DOCS/433355.3
CITY OF BLAIR, NEBRASKA
B
TRUSTEE:
Treasurer of the City of Blair,
Nebraska
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