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HomeMy WebLinkAbout73-021RESOLUTION NO. 73-21 A RESOLUTION OF THE C1TY COUNCIL OF THE CITY OF SANTA ANA APPROVING A DEFERRED COM- PENSATION PLAN AND AUTHORIZING ITS IMPLE- MENTATION. BE IT RESOLVED: That the City of Santa Aha Deferred Compensation plan presented herewith, be and the same hereby is approved and adopted, and the Mayor be and he hereby is authorized and directed to sign the said document on behalf of the City. That the said Plan shall be operative inunediately, upon implementation as provided therein provided however, it shall only apply to the compensation earned by a participating employee after the date such employee files a Participation Agreement with the City. That the City Manager is authorized and directed to appoint at least three (3) City employees to implement and manage the said Plan in the manner therein provided. PASSED AND ADOPTED by the City Council of the City of Santa Ana at its regular meeting held on the 12th day of March , 1973. ATTEST: MAYOR CLERK OF COUNCIL ~1- RESOLUTION NO. 73-21 STATE OF CALIFORNIA) COUNTY OF ORANGE ) CITY OF SANTA ANA ) ss I, FLORENCE I. MALONE, do hereby certify that I am the Clerk of the Council of the City of Santa Ana; that the fore- going Resolution was introduced to said Council at its regular meeting held on the 12th day of March , 1973, and was at said meeting passed and adopted by the follow- ing vote, to wit; AYES, NOES, COUNCILMEN: Herrin, Evans, Markel, Patterson, Villa, Yamamoto, Griset COUNCILMEN: Nome ABSENT, COUNCILMEN: Nome CLERK OF THE COUNCIL -2- 3/88 - DUE TO POOR CONDITION ORIGINAL DESTROYED CITY OF SANTA ANA DEFERRED COMPENSATION PLAN II. III. NAME - The name of this Plan is the City of Santa Aha Deferred Compensation Plan (hereinafter referred to as the "Plan"). PURPOSE - The purpose of this Plan is to enhance employment with the City of Santa Ana. This will assist the City in attracting and holding qualified employees by permitting them to enter into voluntary agreements with the City which will provide for payments upon retirement, as well as death benefits in the event of death before retirement. DEFINITIONS - For the purpose of this Plan, certain words or phrases used herein shall have the following meanings: "Compensation" shall mean regular basic salary for services as an employee on a permanent basis (other than a retirement benefit, retainer or payment for temporary employment) but shall not, except as other- wise determined by the City, include any overtime or special payments. "Deferred Compensation" shall mean the amount of an employee's salary not yet earned, which the employee and the City mutually agree shall be deferred in ac- cordance with the provisions of this Plan. Ce "Normal Retirement" shall mean a retirement from service with the City which becomes effective on the first day of the calendar month after the Par- ticipant meets the age and service requirements for normal retirement specified in the Retirement Plan for the Employees of the City. "Early Retirement" shall mean a retirement from ser- vice with the City which is effective prior to N~rmal Retirement, provided the Participant meets the age and service requirements for Early Retirement benefits specified in the Retirement Plan for the Employees of the City. "Late Retirement" shall mean a retirement from service with the City which becomes effective after the Parti- cipant has exceeded the normal retirement age as spe- cified in the Retirement Plan for the Employees of the City. F. "Termination" shall mean the severance of employment with the City prior to retirement. - 1 - IV· "City" shall mean CITY OF SANTA ANA. "Employee" shall mean any officer or employee of the City who is a full-time regular employee· "Participant" shall mean any Employee who fulfills the eligibility and enrollment requirements of Article 5 of this Plan and who agrees to participate in this Plan. ADMINISTRATION - This Plan shall be administered by the city. The City shall have full power and authority to adopt rules and regulations for the administration of the Plan, and to interpret, alter, amend and revoke any rules and regulations so adopted. V. PARTICIPATION IN THE PLAN - Eligibility - Any full-time, regular Employee who has completed one full year of employment and who is not beyond 65 years of age is eligible to participate in this Plan. B. Enrollment in the Plan: An eligible Employee may become a Participant in the Plan within sixty (60) days of the imple- mentation of this Plan, or on the first day of any calendar year following the Participant's eligibility. Participation may be accomplished by filing a Participation Agreement with the city to defer compensation not yet earned. At the time of entering into an agreement here- under to defer Compensation or the time of re- entry following a withdrawal a Participant must agree to defer a minimum amount of $360 per annum. A subsequent agreement with respect to compensa- tion not yet earned may be executed at any later time, except that no Participant may make more than one agreement in any calendar year, or except as provided in Article VII hereof with respect, to WITHDRAWAL. A Participant's agreement with the City to defer compensation not yet earned may be revoked at any time by notifying the City in writing thirty (30) days prior to the effective date of the revoca- tion. Upon revocation, the Participant's compen- sation shall be restored to its normal, current salary level. - 2 A Participant who has withdrawn as set forth in Article VII or Article VIII(B) or revoked as set forth in (4) above may again become a Participant in any calendar year following his withdrawal or revocation by satisfying the above conditions. vi. BENEFITS UNDER PLAN - A. The Plan ~arovides for alternative types of payment as follows: 1. Deferred Compensation Payments, payable on the happening of any of the following events: --Normal Retirement of a Participant. --Late Retirement of a Participant, or --Early Retirement of a Participant, or --Termination of Services of a Participant. 2. Death benefits payable when a Participant dies before Deferred Compensation payments start. Be The City and the eligible person will execute an agree- ment in writing, confirming their assumptions of the obligations set forth in this Plan and the amounts of compensation to be deferred. C. 1. Subject to the provisions hereof, the City agrees to pay Deferred Compensation payments as follows: a. In the event of an early, late or normal retire- meDt, to the Participant so qualifying: for 120 consecutive months and for remaining lifetime thereafter, commencing the first day of the month following such retirement; or, ii. in a lump sum; or iii. in periodic installments over some period not more than 10 years from date of retire- ment, commencing the first day of the month following such retirement. b. In the case of termination of services, the Par- ticipant so qualifying: for 120 consecutive months and for remaining lifetime thereafter, commencing the first day of the month following such tetirement; or - 3 - ii. in a lump sum; or, iii. in periodic installments over some period not more than 10 years from date of retire- ment, commencing the first day of the month following such termination; or Subject to the provisions hereof, the City may postpone such payments referred to in VI C. 1. a. or VI C. 1. b. until the Participant reaches normal retirement age or such earlier date as the City in its sole discretion may determine. Subject to the provisions hereof, the City agrees to pay Death Benefits to the Participant's designated beneficiary or the Participant's estate for 120 con- secutive months, commencing on the first day of the month following the Participant's death. However, in the sole discretion of the City, such payment may be in a lump sum or installments over some period not more than 10 years from date of Participant's death. If a Participant has qualified to receive Deferred Compensation Payments and such Participant dies be- fore receipt of all 120 monthly payments or such pe- riodic payments as elected under C. 1. a. or C. 1. b., the City agrees to continue to pay such monthly payments for the balance of the 120 month period or such periodic payments as elected under C. 1. a. or C. 1. b. to the Participant's designated beneficiary or the Participant's estate. A Participant may designate one or m~re beneficiaries and may name contingent beneficiaries to whom the Benefits will be payable upon death of any designated beneficiary. The Participant will also have the right to change his designation of beneficiaries. In the event that a Participant's beneficiaries die before all monthly benefit payments become payable to such beneficiaries, whether under 2. or 3. above, then the commuted value (at a rate of interest de- cided upon by the City) of such monthly benefits will be paid by the City to the estate of the last sur- Viving beneficiary. The City may determine that in lieu of the Deferred Compensation Payment provided in C. 1. a. or C. 1. b. to pay an actuarial equivalent series of payments on any one of the following options: (a) a refund - 4 - VII · VIII. basis, (b) or by purchasing a single premium annuity at time of participant's termination to provide payments for 180 consecutive months and life thereafter, or (c) payments for his lifetime and thereafter during any remaining lifetime of a designated second person. In the event such determination is made, the benefit provided in C. 3. will be appropriately modified to provide for payments in the case of (a) above, the 180 month period, and (c) above, for the bal- ance of the remaining lifetime of the designated second person. In addition, the City may choose, by written agreement at least 30 days prior to the Participant's retirement in lieu of fluctuat- ing payments, payments of a fixed amount or combi- nation of fixed and fluctuating payments. WITHDRAWAL - Due to unforeseeable financial obligations and after other sources of financial relief have been explored, a Participant may apply to the city for withdrawal from the Plan prior to retirement or other termination of the Parti- cipant's service with the City. If such application for withdrawal is approved by the City, the withdrawal will be effective at the later of the date specified in the Parti- cipant's application or the date of approval by the City. The city may elect to honor a request from the Participant to pay the amount of money determined as if the Participant had terminated his service; if such request by the Partici- pant is made and honored by the City, the City in its dis- cretion may make payments in a lump sum or in substantially equal monthly, quarterly, or annual installments over a pe- riod of up to five years from the date of withdrawal or in any other set number of periodic payments as determined by the City in its sole discretion. Following withdrawal, the Participant's compensation will be thereupon restored to its normal, current salary level. Unforeseeable financial obli- gations shall include but not be limited to the following: bankruptcy or impending bankruptcy, unexpected and unreim- bursed major expenses resulting from illness to person or accident to person or property and other types of unexpected and unreimbursed expenses of a major nature that would not normally be budgetable. Withdrawals for foreseeable expen- ditures normally hudgetable such as down payments on a home or purchase of an auto or college expenses will not be per- mitted. LEAVE OF ABSENCE - If a Participant is on an approved leave of absence from the City with compensation, his participation in this Plan may continue. 5 - IX. XI. If a Participant Ks on an approved leave of absence without compensation and such leave of absence con- tinues for more than six months, said Participant will be deemed to have withdrawn from the Plan as of the end of such six month period. The City may elect to pay such withdrawn Participant the amount of money determined as if the Participant had terminated his service under VI. C. 1. b. However, the City may postpone such payments referred to in VI. C. 1. b. until the Participant reaches normal retirement age or such earlier date as the City in its sole discre- tion may determine. AMENDMENT OR TERMINATION OF PLAN - The City may at any time terminate this plan. Upon such termination, the Participants in the Plan will be deemed to have withdrawn from the Plan as of the date of such termination; the Participants' full com- pensation on a non-deferred basis will be thereupon restored, and the City agrees to pay such Participants the amount of money determined as if the Participant had terminated his employment, said payment to be made in five substantially equal annual installments, or in substantially equal monthly, quarterly or annual installments over a period of up to five years from the date of withdrawal or in any other set number of periodic payments as determined by the City in its sole discretion. The City may also amend the provisions of this Plan at any time, provided,.however, that no amendment shall affect the rights of Participants or their beneficiaries to the receipt of payment of benefits, to the extent of any compensation de- ferred at the time of the amendment as adjusted for investment experience hereunder prior to and subsequent to the amendment. PLAN INVESTMENTS - The funds and assets of this Deferred Com- pensation Plan shall be invested and reinvested in a manner intended to increase said resources, and the net interest, accumulation and increments thereon shall be credited and held in the Plan for the benefit of Participants. The City shall not be responsible for any loss due to the investment or failure of investment of funds and assets of the Plan nor shall the City be required to replace any loss whatsoever which may result from said investments. NON-ASSIGNABILITY CLAUSE - It is agreed that neither the Par- ticipant, nor his beneficiary, nor any other designees shall have any right to commute, sell, assign, transfer, encumber, or otherwise convey the right to receive any payments here- under which payments and right thereto are expressly declared to be nonassignable and nontranfereable; and, in the event of any - 6 - XII. XIII. XIV. attempted assignment or transfer, the City shall have no fur- ther liability hereunder; nor shall any payments be subject to attachment, garnishment or execution, or be transferable by operation of law in event of bankruptcy, insolvency, except to the extent otherwise provided by law, notwithstanding the above clause. PROHIBITION AGAINST FUNDING - If the city shall acquire a vari- able annuity or life insurance contract or any other asset in connection with the liabilities assumed by it hereunder it is expressly understood and agreed that neither the Participant nor any beneficiary of the Participant shall have any right with respect to, or claim against, such contract(s) or other asset(s). Such contract(s) or other asset(s) shall not be held under any trust for the benefit of the Participant or his beneficiaries or held in any way as collateral security for the fulfilling of the obligations of the City under this Agreement. Such contract(s) or other asset(s) shall be, and remain, a general, unpledged, unrestricted asset of the City. Ail funds and assets together with interest, accumulations and increments thereon of the Deferred Compensation Plan shall re- main an asset of the City and shall be subject to City's owner- ship until such time as the funds or assets of said plan are distributed to the Participant. The obligation of the City to the Participant for payment of the Deferred Compensation and increments thereon referred to in this Plan is a contractual obligation only and Participants shall have no preferred or specific interest, by way of trust, escrow, annuity or other- wise, in and to the specific assets or funds of the plan. The amount of payments under this Plan shall be determined by the City in an actuarial sound manner and may be adjusted from time to time to insure continued actuarial soundness. The provisions of this paragraph shall supersede and control any other provi- sion of this Plan which could be interpreted to be in conflict herewith. It is also understood that the Plan in no way abro- gates the City's or the Employee's rights to terminate employ- ment at any time, with or without cause. APPLICABLE LAW - This Agreement shall be construed under the law of the State of California. IN WITNESS WHEREOF, the City has caused this Agreement to be signed by its duly authorized Officer and attested by its Clerk as amended on the lk~h day of March , 1973 . ATTEST: CITY OF SANTA ANA: CITY CLERK MAYOR - 7