HomeMy WebLinkAboutCity Council - 2009-11 RESOLUTION NO. 2009-11
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF HUNTINGTON BEACH APPROVING
THE SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN AND TRUST
AND ESTABLISHING THE RETIREMENT BOARD
WHEREAS, the City of Huntington Beach provides retirement benefits to its employees
pursuant to several agreements between the City and the California Public Employees
Retirement System ("Ca1PERS"); and
WHEREAS, the City also provides, pursuant to various memorandums of understanding
with its employee associations, a supplemental pension to the Ca1PERS retirement plans; and
WHEREAS, California Government Code Section 20894(c) requires that as a condition
of the City's participation in the Ca1PERS retirement system, any supplemental defined benefit
plan be established as a trust qualified under Internal Revenue Code Section 401(a); and
WHEREAS, in compliance with Section 20894, the City Council has caused to be
prepared the City of Huntington Beach Supplemental Retirement Plan and Trust.
NOW, THEREFORE,the City Council of the City of Huntington Beach does hereby
resolve as follows:
Section 1. The City Council hereby approves the Supplemental Employee Retirement
Plan and Trust ("Trust"), a copy of which is attached hereto.
Section 2. Section 5 of the Trust provides that the Trust will be administered by the
Retirement Board. The City Council hereby determines that the Retirement Board shall consist
of three members. The members of the Retirement Board shall be the City Treasurer,the City
Finance Director, and the City Administrator, or his/her written designee.
Section 3. The Retirement Board shall meet not less than twice per calendar year.
All meetings shall be conducted in compliance with the California Open Meeting Laws,
California Government Code Section 54950 et seq.
Section 4. All members of the Retirement Board shall file annual Statement of
Economic Interests, pursuant to California Political Reform Act, Government Code Section
87200, et seq.
Section 5. The Board may appoint a hearing officer to adjudicate the claims against
the Trust, including, but not limited to whether an employee of the City is a Participant in the
Plan. The hearing officer shall conduct an evidentiary hearing, at which time all relevant
evidence may be presented and considered by the hearing officer. The hearing officer shall issue
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a written decision. The hearing officer's decision shall be the final decision of the Retirement
Board, subject to judicial review pursuant to California Code of Civil Procedure Section 1094.5.
PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a
regular meeting thereof held on the 16th day of March , 20 09
a �
Mayor
REVIEWE PPROVED: INITI AND APPROVED:
City Ad in tr or Deputy City Admin rator
APPROVED AS TO
FORM:
City Attorney
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Resolution No.2009-11
CITY OF HUNTINGTON BEACH
SUPPLEMENTAL RETIREMENT PLAN & TRUST
EFFECTIVE JANUARY 1, 2009
Resolution No.2009-11
TABLE OF CONTENTS
Page
SECTION 1. ESTABLISHMENT AND PURPOSE OF THE PLAN.................................. 1
SECTION2. DEFINITIONS................................................................................................. 1
SECTION 3. ELIGIBILITY AND PARTICIPATION.........................................................4
SECTION 4. PLAN BENEFITS ............................................................................................5
SECTION 5. ADMINISTRATION OF THE PLAN ............................................................7
SECTION 6. TRUST FUND........................... ...............9
.........................:.............................
SECTION 7. ADMINISTRATION OF TRUST................................................................. 10
SECTION 8. BENEFIT LIMITATIONS ............................................................................ 17
SECTION 9. GENERAL PROVISIONS ............................................................................ 19
SECTION 10. MODIFICATION AND TERMINATION OF THE PLAN .........................20
SECTION 11. CHOICE OF LAW ........................................................................................21
SECTION 12. EXECUTION.................................................................................................21
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CITE' OF HUNTINGTON BEACH
SUPPLEMENTAL RETIREMENT PLAN& TRUST
SECTION 1. ESTABLISHMENT AND PURPOSE OF THE PLAN
This City of Huntington Beach Supplemental Retirement Plan and Trust (the"Plan") is
hereby established effective January 1, 2009, by the City of Huntington Beach. The sole purpose
of the Plan is to supplement benefits payable to eligible retirees of the City under the California
Public Employees' Retirement System. Accordingly, the Plan provides for payment of such
benefits in the form of an annuity payable over the life of the eligible retiree; no survivor benefits
are provided under the Plan. The Plan is intended to be a qualified retirement plan as provided in
section 401(a) of the Internal Revenue Code of 1986, as amended(the"Code"), and a
governmental plan within the meaning of section 414(d) of the Code. Capitalized terms are
defined in Section 2, except where expressly indicated otherwise.
SECTION 2. DEFINITIONS
(a) "CalPERS" means the California Public Employees' Retirement System, as
reflected in the California Government Code and as amended from time to time, and any
regulations issued under laws governing CalPERS.
(b) --City Council" means the Huntington Beach City Council.
(c) Code" means the Internal Revenue Code of 1986, as amended.
(d) "Eligible Employee" means an employee of the Employer who (1) on the
employee's Termination Date, is employed by the Employer in a position covered by one of the
bargaining units listed below; and (ii) was first hired in a position covered by that bargaining unit
before the applicable date below:
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(1) For employees represented by the Municipal Employees Association
("MEA"), December 27, 1997.
(2) For employees represented by the Management Employees Organization
("MEO"), August 17, 1998.
(3) For employees represented by the Fire Management Association
("FMA"), August 17, 1998.
(4) For employees represented by the Huntington Beach Firefighters
Association ("HBFA"), October 4, 1999.
(5) For employees represented by the Marine Safety Officers Association
("MSOA"), November 2, 1998.
(6) For employees subject to the Non-Associated Employees Benefits
Resolution ("NA") at the time of their hiring, December 27, 1997.
(7) For employees represented by the Police Management Association
("PMA"), July 6, 1998.
(8) For employees represented by the Huntington Beach Police Officers'
Association ("HBPOA"), July 6, 1998.
By way of example, if an employee is in a position covered by the MEO on his or her
Termination Date, he or she would be an Eligible Employee only if hired in a MEO position
before August 17, 1998. Extending this example, if the employee was hired on January 1, 1998
in an MEA position, and promoted to an MEO position on September 1, 1998, the employee
would not be an Eligible Employee; but if the employee was promoted on August 1, 1998, he or
she would be an Eligible Employee.
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Regardless of the date of hiring, members of the City Council, employees represented by
the Surf City Lifeguard Employees' Association ("SCLEA"), and any employee who was hired
to work less than 20 hours per week, are not Eligible Employees.
(e) "Employer" means the City of Huntington Beach, a governmental entity
established as a municipal corporation pursuant to the Huntington Beach City Charter.
(f) "IRS" means the Internal Revenue Service.
(g) "Optional Retirement Benefit" means an amount payable under CalPERS
pursuant to a member's election to receive an optional settlement under any of sections 21455,
21456, 21457, 21458 or 21459 of the California Government Code, as amended (which sections
collectively set out optional settlements 1, 2, 2W, 3, 3W and 4 under CAPERS).
(h) "Participant" means an Eligible Employee or former Eligible Employee who is a
Participant in accordance with Section 3.
(1) "Plan" means this City of Huntington Beach Supplemental Retirement Plan.
0) "Plan Year" means the 12-month period ending June 30 of each year.
(k) "Qualified Domestic Relations Order" means a domestic relations order that
creates or recognizes the existence of an alternate payee's right to, or assigns to an alternate
payee the right to, receive all or a portion of the benefits payable with respect to a Participant
under the Plan and that specifies (1) the name and.the last known mailing address of the
Participant and each alternate payee covered by the order, (ii) the amount or percentage of the
Participant's benefits to be paid by the Plan to each such alternate payee, or the manner in which
such amount or percentage is to be determined, (iii) the number of payments or period to which
such order applies, and (iv) each plan to which such order applies. A domestic relations order
refers to any judgment, decree or order (including approval of a property settlement agreement)
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that relates to the provision of child support, alimony payments, or marital property rights to a
spouse, former spouse, child, or other dependent of a Participant and is made pursuant to a state
domestic relations law.
(1) "Retirement Board"means one or more persons appointed by the Employer to
administer the Plan and control and manage assets under the Plan. See Section 5.
(m) "Supplemental Retirement Benefit" means the benefit provided under the Plan.
See Section 4.
(n) "Termination Date" means the date on which a Participant's employment with the
Employer ceases.
(o) "Trust" means the trust established pursuant to the terms of this Plan to hold the
Plan's assets. See Section 7.
(p) "Trustee" means the trustee appointed by the Retirement Board to hold and invest
assets under the Trust.
SECTION 3. ELIGIBILITY AND PARTICIPATION
Each Eligible Employee on January 1, 2009 will become a Participant on such date. In
addition, each former Eligible Employee (whose Termination Date occurred before 2009) who
was receiving the Supplemental Retirement Benefit prior to 2009 will become a Participant on
January 1, 2009 at the same level of Supplemental Retirement Benefit. A Participant's
participation in the Plan will cease on the earliest of(1) his or her death, (ii) upon the
Participant's Termination Date, if he or she is not then eligible for Supplemental Retirement
Benefits under Section 4(b), (iii) the cessation of Supplemental Retirement Benefit payments
under this Plan to the Participant in accordance with Section 4(g), or(iv) the complete-
distribution of the Participant's interest under the Plan following the termination of the Plan.
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SECTION 4. PLAN BENEIF'ITS
(a) General. The Plan provides for monthly Supplemental Retirement Benefit
payments to Participants who meet the requirements under Section 4(b). Such Supplemental
Retirement Benefit payments will be made in the amount specified in Section 4(d), and at the
time and form specified in Section 4(e).
(b) Eligibility for Supplemental Retirement Benefits. In order to receive benefits
under the Plan, a Participant must: (i) have a vested retirement benefit under CalPERS upon his
or her Termination Date; (ii) retire under CalPERS following the Termination Date, triggering
commencement of payment of his or her retirement benefits under CalPERS; and (Ili) elect to
receive such CalPERS benefits in the form of Optional Retirement Benefit 2, 2W, 3, 3W or 4.
(c) Deferral of CalPERS Benefits Following Termination Date. The Participant may
defer immediately retiring from CaIPERS following his or her Termination Date and still receive
Supplemental Retirement Benefits under the Plan, but only if there is no intervening employment
with another CalPERS agency for which the Participant receives service credit under CalPERS.
Intervening employment with a non-CalPERS employer is permitted. See Section 4(g). The
Participant is ineligible to receive Supplemental Retirement Benefits under the Plan if he or she
retires from another CalPERS agency.
(d) Amount of Supplemental Retirement Benefit. The monthly Supplemental
Retirement Benefit payable under the Plan to a Participant will be determined upon the effective
date of his or her retirement under CAPERS ("Retirement Date") following the.Participant's
Termination Date. Such monthly Supplemental Retirement Benefit will equal the excess, if any,
of(1) the monthly payment the Participant would have received under CAPERS if he or she had
not elected to receive an Optional Retirement Benefit, over(ii) the monthly payment actually
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made under CalPERS to the Participant pursuant to the elected Optional Retirement Benefit.
Any subsequent increases in the Participant's CalPERS benefits after his or her Retirement Date
will have no effect on the amount payable to such Participant under this Plan.
Notwithstanding anything to the contrary, if the Retirement Board determines that a
Participant has received any Supplemental Retirement Benefit payments under this Plan in
excess of the amount to which such Participant is entitled under the preceding provisions of this
Section 4(d), each future Supplemental Retirement Benefit payment to the Participant under the
Plan will be reduced to the maximum extent necessary(including to zero) until the total
reductions equal the sum of the aggregate prior overpayments plus interest; for this purpose,
interest will be calculated at a reasonable rate as determined by the Retirement Board through the
date(s) of reduction.
(e) For n and Time of Supplemental Retirement Payment. Supplemental Retirement
Benefit payments under the Plan to a Participant will be payable after his or her Termination
Date in the form of an annuity for the Participant's life that provides for payments under the Plan
at the same times as the Participant's corresponding benefit payments under CalPERS, subject to
Section 4(1) below.
(f) Reemployment with Employer. Notwithstanding the preceding provisions of this
Section 4 to the contrary, if a Participant is reemployed by the Employer after distribution of his
or her Supplemental Retirement Benefit under this Plan has commenced, payment of such
Supplemental Retirement Benefit will be terminated on the reemployment date (or, if later, the
date he or she is not entitled to receive CalPERS benefits due to such reemployment), and the
Participant will not be entitled to any further Supplemental Retirement Benefits under the Plan,
unless the Participant is reinstated in accordance with the City's Personnel Rules. If the
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Participant is entitled to continued payment of his or her CalPERS benefits on and after the
reemployment date, then he or she will be entitled to receive continued Supplemental Retirement
Benefits under the Plan.
(g) Reinstatement in CalPERS. If a Participant is reinstated in CalPERS as an active
member after his or.her Termination Date, all Supplemental Retirement Benefit payments to
such Participant under this Plan will cease and his or her participation in the Plan will cease.
(h) No Survivor Benefits. No survivor benefits will be payable under the Plan after
the Participant's death, regardless of whether any person is entitled to survivor benefits under
CalPERS due to the Participant's death.
(1) Minimum Distribution Requirements. All distributions under the Plan will
comply with the minimum distribution requirements of section 401(a)(9) of the Code and the
regulations thereunder.as set forth in Appendix A.
SECTION 5. ADMINISTRATION OF THE PLAN
(a) Plan Administration. The Plan will be administered by the Retirement Board.
The City Council shall establish by Resolution the procedures for appointing and removing the
Board members as well as their terms.
(b) Authority of Retirement Board.
(1) The Retirement Board has the authority to control and manage the
operation and administration of the Plan. The Retirement Board will have the sole discretion to
interpret the terms of the Plan, determine eligibility under the Plan, and direct the investment of
Plan assets. The Retirement Board shall prescribe such forms and shall adopt such rules,
interpretations and procedures and shall take such other actions to administer the Plan as it
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deems appropriate. Such rules, interpretations and procedures will be conclusive and binding on
all persons claiming an interest in the Plan.
(ii) With respect to the control and management of the assets of the Plan, the
Retirement Board will have:
(A) the duty to appoint a Trustee to hold the assets of the Plan in trust
and to enter into a trust agreement with the Trustee with respect to the assets held in trust
thereunder;
(B) to cause the Trustee to enter into a contract with an insurance
company, which contract may be a group annuity contract, guaranteed investment contract,
deposit administration contract, or other type of contract commonly used to fund retirement
benefits;
(C) the authority to appoint one or more investment managers, for any
assets held in trust pursuant to the Plan and to enter into a contract with each such investment
manager with respect to management of such assets;
(D), the authority to direct the sale, investment or reinvestment of Plan
assets; and
(E) the authority to remove any Trustee, insurance company or
investment manager.
(c) Responsibilities of the Retirement Board. The Retirement Board may delegate
any of its responsibilities under the Plan to a person or persons pursuant to a written instrument
that specifies the responsibilities so delegated to each such person.
(d) Engagement of Services of Others. The Retirement Board may engage the
services of such persons or organizations to render advice or perform services with respect to its
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responsibilities under the Plan as it determines necessary or appropriate. The Retirement Board
will be entitled to rely conclusively upon all tables, valuations, certificates and reports furnished
by any actuary or accountant engaged by the Retirement Board and upon all opinions of counsel
or other experts, and the Retirement Board will be fully protected as to any action taken in good
faith reasonable reliance upon any such tables, valuations, certificates, reports or opinions.
(e) Service Capacity. Any person or group of persons may serve in more than one
capacity with respect to the Plan, including service as both Trustee and Retirement Board.
(f) Expenses of the Retirement Board. All reasonable expenses incurred by the
Retirement Board in connection with the administration of the Plan will be paid out of the Trust
unless paid by the Employer.
SECTION 6. TRUST FUND
(a) Trust Fund. The Employer shall establish and maintain a retirement fund under
the Plan to carry out the purposes of the Plan.
(b) Amount. The Employer shall make contributions to the Plan from time to time
for the purpose of providing benefits. Such contributions will maintain the Plan at an amount
determined from time to time by the Employer, after consultation with the Plan's actuary, as the
amount necessary to keep the Plan sufficiently funded. Forfeitures arising under the Plan
because of severance of employment before a Participant becomes eligible for the Supplemental
Retirement Benefit, or for any other reason, will be applied to reduce the cost of the Plan, not to
increase the Supplemental Retirement Benefits otherwise payable to Participants.
(c) Irrevocability. Subject to Section 10(b) and this paragraph, all contributions made
by the Employer to the Plan will be used and applied for the exclusive benefit of Participants,
and such contributions will not be used for, nor diverted to, purposes other than for such
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exclusive benefit of Participants; provided, that for this purpose, payment of administrative
expenses by the Plan to the extent not paid by the Employer, will be considered paid for such
exclusive benefit. A contribution made to the Plan by mistake of fact may, upon direction of the
City Council, be returned within one year after payment to the Plan. If, subsequent to the initial
effective date of the.Plan, the Commissioner of Internal Revenue or its representative issues a
determination letter stating that the Plan does not initially qualify under section 401(a) of the
Code, any contribution made to the Plan by the Employer and to which the letter relates may be
returned to the Employer within one year from the date of the letter, upon direction of the City
Council, but only if an application for determination on qualification of the Plan under section
401(a) of the Code has been made by the time prescribed by the Secretary of the Treasury.
SECTION 7. ADMINISTRATION OF TRUST
(a) Investment Manager. The Retirement Board may delegate its investment
responsibilities over any portion of the Plan assets to one or more investment managers. Each
investment manager will be a fiduciary under the Plan and will acknowledge its action as a
fiduciary under the Plan in a writing delivered to the Trustee and to the Retirement Board.
Subject to the terms of any agreement with the Retirement Board, the investment manager may
direct the Trustee to invest all or such portion of the Trust placed in the discretion of the
investment manager in securities or other properties as are selected by the investment manager,
and may direct the Trustee to sell any securities or other property of the Trust placed in its
discretion. In directing investments, the investment manager shall diversify the investments so
as to minimize the risk of large losses, unless under the circumstances and in the opinion of the
investment manager, it is clearly prudent not to do so. To the extent Plan assets are invested at
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the direction of an investment manager in any stocks, bonds, or other securities, the investment
manager shall vote such investments solely in the interest of Participants.
(b) Appointment of Trustee. The Retirement Board shall select the Trustee, who may
be one or more individuals, a corporate trustee or trustee, or both, and shall enter into an
agreement with the Trustee setting forth the duties and responsibilities of the Trustee. The
Retirement Board may modify any such agreement(s) from time to time.
(c) Authority and Power of Trustee. Subject to such instructions, rules and
restrictions as may be adopted by the Retirement Board and communicated to the Trustee:
(i) the Trustee will have the authority to invest assets in accordance with
the directions of the Retirement Board or the investment manager(s) appointed by the Retirement
Board; and
(ii) the Trustee will have the following powers:
(A) Investment Powers. The Trustee may improve, lease for any term
irrespective of the duration of the Trust, rent, sell, exchange, hold, control, invest and reinvest
the same in such manner and upon such terms as the Trustee deems best, including(without
limitation of these powers) the power to purchase shares in investment trusts or stock in
corporations. The Trustee is authorized to hold cash uninvested from time to time. The Trustee
will not be personally liable upon any contract of indebtedness of or claim against the Trust or
upon a mortgage, trust deed, note or other instrument executed under the provisions of this Plan.
(B) Holding and Transferring Real Estate. To take and hold title to
real estate or interests therein in the Trustee's name or in the name of the Trustee's nominee
without disclosing the Trust; and in accepting title to the real estate, neither the Trustee nor the
Trustee's nominee will be held to have assumed the payment of any encumbrances thereon, nor
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any responsibility as to the validity of the title conveyed to or held by the Trustee or the
Trustee's nominee. All conveyances executed and delivered by the Trustee or the Trustee's
nominee will be without covenants of warranty except as against the Trustee's own acts.
(C) Voting and Related Powers. To vote any stocks, bonds, or other
securities held by the Trust at the direction of an investment manager or Retirement Board, as
applicable; to give general or special powers of attorney with or without power of substitution; to
exercise any conversion privileges, subscription rights or other options and to make any
payments incidental thereto; to consent to or otherwise participate in corporate reorganizations or
other changes affecting corporate securities and to delegate discretionary powers and to pay any
assessments or charges in connection therewith; and generally to exercise any of the powers of
an owner with respect to stocks, bonds, securities or other property held in the Trust.
(D) Claims by or Against the Trust. To sue or defend in any suit or
legal proceedings by or against the Trust. The Trustee will have full power in the Trustee's
discretion to compound, compromise and adjust all claims and demands in favor of or against the
Trust upon such terms as the Trustee deems best. In the administration of the Trust, the Trustee
will not be obligated to take any action that may subject the Trustee to any expense or liability
unless the Trustee is first indemnified to the Trustee's satisfaction for all expenses and liabilities,
including attorneys' fees, that the Trustee may incur in connection with such action.
(E) Nominee. To register any investment held in the Trust in the
Trustee's own name or in the name of a nominee and to hold any investment in bearer form;
provided, however, that the books and records of the Trustee will at all times show that all such
investments are part of the Trust, and provided further that such registration or holding will
neither increase nor decrease the liability of the Trustee.
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(F) Employment of Agents. To employ such agents, attorneys-in-fact,
experts and investment and legal counsel, including any firm or corporation with which the
Trustee may be associated as a partner, director, stockholder or otherwise, and to delegate
discretionary powers to or to rely upon information or advice furnished by such agents,
attorneys-in-fact, experts or counsel.
(G) Execution of Instruments. To execute and deliver any and all
documents of transfer and conveyance and any and all other instruments that may be necessary
or appropriate to carry out the powers herein granted, and to perform any and all acts that may be
necessary or convenient in the proper administration of the Trust.
(H) Collective Investment Trust. To the extent permitted by law, to
commingle assets of the Trust with assets of other trusts, which in each case form a part of a
pension or profit-sharing.plan qualified under the Code and constitute an exempt trust within the
meaning of the Code, (A) through the medium of any collective investment trust for employee
benefit trusts established and maintained by any bank, or(B) through the medium of any
collective investment trust for employee benefit trusts established and maintained by any trust
company. To the extent of the equitable share of this Trust in any such investment trust, the
instrument establishing such investment trust, as the same has been or may be amended, and the
trust maintained thereunder, will be deemed a part of this Plan and Trust as if fully set forth
herein.
(I) Necessary Acts. To do all acts whether or not expressly authorized
that may be necessary or proper for the protection of the property held hereunder or for the
carrying out of any duty under this Plan or under the Trust.
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(d) Responsibilities of Trustee
(i) The Trustee shall sell, invest, or reinvest the Trust assets in accordance
with the directions of the Retirement Board or the investment manager(s) appointed by the
Retirement Board. The Trustee will have no liability for any depreciation or loss with respect to
any investments acquired by the Trustee pursuant to such direction, and will have no duty to
review or to make recommendations with respect thereto. Notwithstanding any other provision
of the Plan or any trust agreement, the Trustee will be fully protected in relying upon the
certification of the Retirement Board with respect to the appointment of an investment manager.
(ii) The Trustee shall receive, hold, invest and reinvest contributions to the
Trust and shall make disbursements from the Trust pursuant to the terms of this Plan. Subject to
the consent of the Trustee, the Employer will have the right to make its contributions hereunder
in property to the Trustee. The Trustee shall make payments from the Trust only to such
persons, in such manner, at such times, and in such amounts as specified in written directions
from the Retirement Board, and the Trustee will be fully protected in making payments under the
direction of the Retirement Board. For purposes of accounting and valuation, the records of the
Trust will be maintained on a cash receipts and disbursements basis. The Trustee shall
periodically capitalize unexpended income and add the same to the principal of the Trust.
(e) Agent. The Trustee shall act in accordance with instructions from directions from
any person designated as agent for such purpose by the Retirement Board. The Retirement
Board shall notify the Trustee of any change of agent. The Trustee will be entitled to rely upon
infortnation or instructions received from the agent of the Retirement Board whose authority to
act was last certified by the Retirement Board. In the absence of instructions from the
Retirement Board, the Trustee will have full power and authority to act in the Trustee's
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discretion, if the Trustee determines that failure to act would frustrate the purpose of the Trust or
Plan.
(f) Reliance on Documentation. The Trustee may rely upon any affidavit, certificate,
letter, notice, telegram or other paper or document believed by the Trustee to be genuine and
upon any information or evidence believed by the Trustee to be sufficient; and the Trustee will
be protected in all payments hereunder if made in good faith and without actual knowledge of the
happening of an event or a change in conditions that would affect such payments.
(g) Pooled Assets. Except as otherwise provided hereinabove, all the assets in the
Trust will be held collectively for all the Participants with no physical division thereof until such
assets are actually distributed.
(h) Nonliability of Successor Trustee. Each successor Trustee may accept as
complete and correct and may rely upon any accounting that has been made by or on behalf of
any Trustee before the successor Trustee becomes a Trustee under this instrument. and may rely
upon any statement or representation made by any Trustee acting hereunder as to the assets
comprising the Trust or as to any other fact bearing upon the prior administration of the Trust;
and such successor Trustee will not be subject to any liability by reason of having accepted and
relied upon such accounting, statement or representation in case it is subsequently established
that the same was incomplete, inaccurate or untrue. No successor Trustee will be subject to any
liability or responsibility with respect to any act or omission of any other Trustee, and no
successor Trustee will have any duty to enforce or to seek to enforce any claims of any kind
against any predecessor Trustee on account of or in connection with any act or omission of any
Trustee hereunder.
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(1) Accounts. The Trustee shall keep accurate and detailed accounts of all
investments, receipts and disbursements and other transactions hereunder, and all accounts,
books and records relating thereto will be open to inspection by any person designated by the
Retirement Board at all reasonable times. For each Plan Year, the Trustee shall provide the
Retirement Board with a written report setting forth all investments, receipts, disbursements, and
other transactions effected by the Trustee from the date of the prior such report to the close of
such Plan Year, or the date of removal or resignation of a Trustee, as the case may be. Such
report is expected to be provided not later than 120 days after the end of each Plan Year, and
within 60 days after the effective date of the removal or resignation of a Trustee. Such report
must contain an exact description of all securities and investments held at the close of such Plan
Year or the effective date of such removal or resignation of a Trustee, as the case may be, and
the cost of each item thereof, as carried on the books of the Trustee.
(j) Removal or Resignation of Trustee. The Retirement Board may remove any
Trustee by delivery of written notice to such Trustee. Any Trustee hereunder may resign as
Trustee, upon written notice to that effect, delivered to the Retirement Board. Such removal or
resignation will be effective upon the date specified in such notice, which may be not less than
15 days after the delivery of such notice. In the event of the removal, resignation, death or
inability to serve of any Trustee hereunder, a successor will be appointed by resolution of the
Retirement Board, a certified copy of which resolution will be delivered to such successor. In
the event of the removal, resignation, death or inability to serve of any Trustee after the
Employer has ceased to exist or been dissolved, voluntarily or involuntarily, or has a receiver or
trustee in bankruptcy appointed, a successor may be appointed by election by a majority in
interest of the Participants. A successor Trustee, upon accepting such appointment, will become
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vested with the same powers, duties, privileges, and immunities as if such Trustee had been
originally named in this Plan as a Trustee. In case of the removal, resignation, death or inability
to serve of an individual Trustee, said Trustee or his personal representative shall forthwith turn
over to the remaining or succeeding individuals serving as Trustee all accounts and records in
such individual Trustee's possession, and shall execute such instruments as may be necessary to
terminate his or her trusteeship. '
SECTION 8. .BENEFIT LIMITATIONS
(a) General Rule. Unless the alternative limitation of Section 8(b) applies, a
Participant's Annual Benefit (defined below) for a Plan Year(which will be the Plan's
"limitation year") will not exceed $180,000, adjusted as described below.
(i) As of January 1 of each calendar year, the adjusted dollar limitation for
such calendar year announced by the IRS pursuant to section 415(d) of the Code will
automatically be substituted for the$180,000 amount set forth above and will become the dollar
limitation applicable under the Plan Year ending during such calendar year.
(ii) If a Participant would exceed the limitation of this Section 8(a), then the
Participant's Annual Benefit under this Plan will be reduced to the extent necessary to meet the
limitation.
(iii) The limitation provided in this Section 8 will be applied in accordance
with the provisions of section 415(b) of the Code and regulations issued thereunder.
(b) Adjusted Dollar Limitation for Supplemental Retirement Benefits Commencing
Before Age 62 or After Age 65.
(1) In the case of a Participant whose Supplemental Retirement Benefit
commences before age 62, the amount described in Section 8(a) (adjusted as described therein)
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Resolution No.2009-11
will be reduced. The reduced limit will be the amount determined by treating the amount
described in Section 8(a) (adjusted as described therein) as an annual single-life annuity
commencing at age 62 and converting it on an actuarial basis into a single-life annuity that
commences at the age when the Participant's retirement benefit commences (using the mortality
factors prescribed by the IRS in Revenue Ruling 2001-62 and a 5% interest rate).
Notwithstanding the.preceding provisions of this paragraph, no reduction will be made in the
amount described in Section 8(a) (adjusted as described therein) with respect to any Qualified
Participant whose retirement benefit commences before age 62. For this purpose, "Qualified
Participant" means a Participant who, upon his or her Termination Date, has.completed at least
15 years of full-time employment with the Employer's police or fire department that are taken
into account for purposes of determining the Participant's retirement benefits under CAPERS.
(ii) In the case of a Participant whose Supplemental Retirement Benefit
commences after age 65, the amount described in Section 8(a) (adjusted as described therein)
will be increased. The increased limit will be calculated by treating such amount as an annual
single-life annuity commencing at age 65 and by converting it on an actuarial basis into a single-
life annuity that commences at the age when the Participant's retirement benefit commences
(using the mortality factors prescribed by the IRS in Revenue Ruling 2001-62 and a 5% interest
rate).
(c) Annual Benefit. For purposes of this Section 8, a Participant's "Annual Benefit"
will be equal to the sum of the following:
(1) The annual Supplemental Retirement Benefit to which the Participant is
entitled under this Plan; and
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Resolution No.2009-11
(ii) The aggregate annual retirement benefits (if any)to which the
Participant is entitled under all other qualified defined-benefit plans (including Ca1PERS)
maintained by the Employer, other than benefits attributable to employee contributions.
SECTION 9. GENERAL PROVISIONS
(a) Incompetence. If, in the opinion of the Retirement Board, any individual
becomes unable to properly handle any amount distributable under the Plan, the Retirement
Board may make any arrangement for distribution on such individual's behalf that it determines
will be beneficial to such individual, including, without limitation, distribution to such
individual's guardian, conservator, spouse or dependent.
(b) Anti-Assi ngment. Except as otherwise provided in this paragraph, the rights of a
Participant to Supplemental Retirement Benefits will not be subject to alienation or assignment,
and will not be subject to anticipation, encumbrance or claims of creditors. Notwithstanding the
preceding sentence, the Plan shall pay Supplemental Retirement Benefits in accordance with the
terms of any Qualified Domestic Relations Order, provided that such Order(1) does not require
the Plan to provide any type or form of benefits, or any option, that is not otherwise provided
hereunder, (ii) does not require the Plan to provide increased benefits, and (iii) does not require
the payment of benefits to an alternate payee that are required to be paid to another alternate
payee under another order previously determined to be a Qualified Domestic Relations Order.
(c) Employment Rights. Nothing in the Plan will be deemed to give any person a
right to remain in the employ of the Employer. The Employer reserves the right to terminate any
person's employment, with or without cause or, if applicable, in accordance with any agreement
affecting the Participant's rights to employment and the Employer's right to terminate
employment.
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Resolution No.2009-11
SECTION 10. MODIFICATION AND TERMINATION OF THE PLAN.
(a) Amendment and Termination. The Employer will have the power to amend or
terminate the Plan at any time; provided,however, that no amendment will:
(1) Reduce the Supplemental Retirement Benefits of any Participant or other
person accrued under the Plan prior to the date the amendment is adopted, except to the extent
that a reduction in accrued Supplemental Retirement Benefits is permitted by applicable law; or
(ii) Divert any part of the assets of the Trust to purposes other than the
exclusive purpose of providing Supplemental Retirement Benefits to Participants and other
persons who have an interest in the Plan and defraying the reasonable expenses of administering
the Plan. The Employer shall notify the Trustee of any amendment or the termination or partial
termination of the Plan.
(b) Termination and Reversion. Upon termination of the Plan, no part of the assets of
the Plan will revert to the Employer or be used or diverted for purposes other than the exclusive
purpose of providing Supplemental Retirement Benefits to those individuals who have an interest
in the Plan; provided, however, that any assets remaining in the Trust may be returned to the
Employer if:
(i) All liabilities of the Plan to Participants have been satisfied; and
(ii) Such return does not contravene any applicable provision of law.
Upon a partial tennination of the Plan, this Section 10(b) will apply only with respect to those
Participants who are affected by such partial termination.
(c) 100% Vesting on Termination. Upon termination or partial termination of the
Plan, the right of each Participant to his or her accrued Supplemental Retirement Benefit under
the Plan will, to the extent funded, be 100% vested and nonforfeitable. Upon termination or
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Resolution No.2009-11
partial termination of the Plan, the Trust will continue to exist until all assets held under the Trust
or the appropriate portion thereof has been distributed as provided in Section 10(d).
(d) Limitation of Obligations.__ Notwithstanding any other provision hereof, the
Employer will have no obligation to continue to make contributions.to the Plan after the Plan's
termination. Neither of the Employer, the Retirement Board, the Trustee nor any other person or
entity will have any liability or obligation to provide benefits hereunder after the termination of
the Plan. Upon termination of the Plan, all Participants shall look solely to the Trust for their
benefits. In the event of a partial termination of the Plan,this Section 10(d) will apply only with
respect to those Participants who are affected by such partial termination.
SECTION 11. CHOICE OF LAW
The validity, interpretation, construction and performance of the Plan will be governed by
the laws of the State of California.
SECTION 12. EXECUTION
To record the adoption of the Plan, the Employer has caused this document to be
executed by its duly authorized representative(s) on this day of— 2009.
ATTEST: CITY OF HUNTINGTON BEACH, a
municipal corporation of the State of
California
JOAN FLYNN KEITH BOHR
City Clerk Mayor
APPROVED AS TO FORM:
9
JENNII c ATH
Z 8 City Attorney
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Resolution No.2009-11
CITY OF HUNTINGTON BEACH
SUPPLEMENTAL RETIREMENT PLAN & TRUST
APPENDIX A
Minimum Distribution Requirements
A.1 General Rules
A.1.1 Effective Date. Notwithstanding any other provision of the Plan to the
contrary, the provisions of this Appendix will apply for purposes of determining required
minimum distributions.
A.1.2 Precedence. The requirements of this Appendix will take precedence
over any inconsistent provisions of the Plan.
A.1.3 Requirements of Treasury Regulations Incorporated. All distributions
required under this Appendix will be determined and made in accordance with the Treasury
regulations under section 401(a)(9) of the Code.
A.2 Time and Manner of Distribution
A.2.1 Required Bep_inninp_Date. The Participant's entire interest will be
distributed, or begin to be distributed, to the Participant no later than the Participant's Required
Beginning Date.
A.2.3 Form of Distribution. Unless the Participant's interest is distributed in
the form of an annuity purchased from an insurance company or in a lump sum distribution on or
before the Required Beginning Date, as of the first Distribution Calendar Year distributions will
be made in accordance with Section A.3 of this Appendix A. 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 Code
and the Treasury regulations. Any part of the Participant's interest which is in the form of an
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Resolution No.2009-11
individual account described in section 414(k) of the Code shall be distributed in a manner
satisfying the requirements of section 401(a)(9) of the Code and the Treasury regulations that
apply to individual accounts.
A.3 Determination of Amount to be Distributed Each Year
A.3.1 General Annuity Requirements. If the Participant's interest is paid in
the form of annuity distributions under the Plan, payments under the annuity must satisfy the
following requirements:
(a) The annuity distributions will be paid in periodic payments made
at intervals not longer than one year.
(b) The distribution period will be over the life of the Participant.
(c) Payments will either be non-increasing or increase only as follows:
(1)by an annual percentage increase that does not exceed the annual percentage increase in a
cost-of-living index that is based on prices of all items and issued by the Bureau of Labor
Statistics; or(2) to pay increased benefits that result from a Plan amendment.
A.3.2 Amount Required to be Distributed by Required Be$inniny-Date. The
amount that must be distributed on or before the Participant's Required Beginning Date is the
payment that is required for one payment interval. The second payment need not be made until
the end of the next payment interval even if that payment interval ends in the next calendar year.
Payment intervals are the periods for which payments are received, e.g., bi-monthly, monthly,
semi-annually, or annually. All of the Participant's benefit accruals as of the last day of the first
Distribution Calendar Year will be included in the calculation of the amount of the annuity
payments for payment intervals ending on or after the Participant's Required Beginning Date.
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Resolution No.2009-11
A.3.3 Additional Accruals After First Distribution Calendar Year. Any
additional benefits accruing to the Participant in a calendar year after the first Distribution
Calendar Year will be distributed beginning with the first payment interval ending in the
calendar year immediately following the calendar year in which such amount accrues.
A.4 Definitions
The following words and phrases used in this Appendix A have the following meanings.
A.4.1 "Distribution Calendar Year" means calendar year for which a
minimum distribution is required. The first Distribution Calendar Year is the calendar year
immediately preceding the calendar year which contains the Participant's Required Beginning
Date.
A.4.2 "Required Beginniny, Date" means April 1 of the calendar year following
the later of the calendar year in which the Participant attains age 70 `/z or the calendar year in
which the Participant retires.
A.4.3 Other Capitalized Terms. All other capitalized terms used in this
Appendix A have the meanings set forth in Section 2 of the Plan, unless the context requires
otherwise.
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Res. No. 2009-11
STATE OF CALIFORNIA
COUNTY OF ORANGE ) ss:
CITY OF HUNTINGTON BEACH )
I, JOAN L. FLYNN the duly elected, qualified City Clerk of the City of
Huntington Beach, and ex-officio Clerk of the City Council of said City, do hereby
certify that the whole number of members of the City Council of the City of
Huntington Beach is seven; that the foregoing resolution was passed and adopted
by the affirmative vote of at least a majority of all the members of said City Council
at a regular meeting thereof held on March 16, 2009 by the following vote:
AYES: Carchio, Dwyer, Green, Bohr, Coerper, Hardy, Hansen
NOES: None
ABSENT: None
ABSTAIN: None
CityV,lerk and ex-officio Merk of the
City Council of the City of
Huntington Beach, California