HomeMy WebLinkAbout1998-086-05/19/1998-AMENDING THE GENERAL EMPLOYEES RETIREMENT PLAN RESOLUTION 98-86
OF THE COUNCIL OF THE CITY OF FORT COLLINS
AMENDING THE CITY OF FORT COLLINS' GENERAL
EMPLOYEES RETIREMENT PLAN
WHEREAS, the terms of the City of Fort Collins General Employees Retirement Plan (as
restated and effective January 1, 1992)("the Plan") have been reviewed by the General Employees
Retirement Committee (the "Committee"); and
WHEREAS,the Committee has recommended to the City Council that portions of the Plan
be amended so as to provide the ability for single-sum benefit payments to be made to members of
the Plan upon retirement or severance of employment, thereby increasing the portability and
flexibility of pension benefits, and so as to remove possible areas of ambiguity within the Plan;and
WHEREAS,the proposed amendments to the Plan are not expected to increase the funding
requirements of the Plan as the proposed provision for the single-sum payment of benefits is
designed to be revenue neutral in its effect upon the Plan; and
WHEREAS, the City Council wishes to adopt the recommendation of the Committee; and
WHEREAS, Article XIV, Modification or Termination of Plan, Section 2, of the Plan
authorizes the City Council to amend the terms of the Plan.
NOW,THEREFORE,BE IT RESOLVED BY THE COUNCIL OF THE FORT COLLINS,
COLORADO as follows:
Section 1. That effective June 1, 1998, subsections b, s, and z of Section 2 of Article II of
the City of Fort Collins General Employees Retirement Plan shall be amended to read as follows:
b. "Actuarial(or Actuarially)Equivalent"means equality in value ofthe
aggregate amounts expected to be received under different forms of payment based
on interest rate and mortality assumptions as defined below unless otherwise
specifically provided in the plan:
(1) Interest rate assumption for alternative periodic
benefits. The Interest rate used for purposes of computing alternative
periodic forms of benefits shall be 7.5%,unless otherwise specifically
provided in the plan.
(2) Interest rate assumption for sin l�pUments. The
interest rate used for purposes of computing single-sum benefits shall
be one of the following, as specifically designated in the plan:
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(a) the immediate annuity rate(subject to
adjustment as required for deferred annuities)used by
the Pension Benefit Guaranty Corporation as of the
January 1 coincident with or preceding the date as of
which the amount of the alternative form of benefit is
being determined hereunder;
(b) the investment return rate used by the
Retirement Committee for purposes of the Plan
actuarial valuation as of the December 31 coincident
with or preceding the date as of which the amount of
the alternative form of benefit is being determined
hereunder.
(3) Mortality assumption. The mortality assumption for
calculations based upon the mortality of an Member or Beneficiary
shall be a unisex rate that is 50% male, 50%female, taken from the
1983 Group Annuity Table. Said mortality assumption shall be used
until changed by Plan amendment.
S. "Member"means any person included in the membership of this Plan
as provided in Article III hereof,including an Employee who qualifies for Disability
as defined in Section 21. of Article II.
Z. "Trustee" shall mean any qualified and acting Trustee appointed by
the Retirement Committee as a Named Fiduciary for the investment and management
of Plan assets.
Section 2. That effective June 1, 1998, Section 5 of Article VI of the City of Fort Collins
General Employees Retirement Plan shall be amended to read as follows:
Section 5. Minimum Periodic Payment. If the amount of the monthly
Retirement Benefit payable to a retired Member is less than $100, the retired
Member shall be paid a single-sum equal to the Actuarial Equivalent of such
Retirement benefit. For retired Members who commenced Covered Employment
prior to June 1, 1998,said Actuarial Equivalent specified in this section 5 shall be as
defined by subsections b(2)(a) and b(3) of section 2 of Article 11 of this Plan. For
retired Members who commenced Covered Employment on or after June 1, 1998,
said Actuarial Equivalent specified in this section 5 shall be as defined by
subsections b(2)(b) and b(3) of section 2 of Article II of this Plan.
Section 3. That effective June 1, 1998, Section 5 of Article VII of the City of Fort Collins
General Employees Retirement Plan shall be redesignated as Section 6 of said Article,the reference
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to Section 5 set forth in the first sentence of Section 1 of said Article shall be changed to a reference
to Section 6, and a new Section 5 shall be added to said Article to read as follows:
Section 5. Sin2le-Sum Benefit. The Member may elect as an optional form of
benefit a single-sum benefit equal to the Actuarial Equivalent of the basic Retirement
benefit, as defined by subsections b(2)(b)and b(3) of section 2 of Article II of this
Plan. If so elected, such single-sum shall be paid within 90 days of eligibility for
receipt of a Retirement benefit.
Section 4. That effective June 1, 1998, Section 1 of Article VIII of the City of Fort Collins
General Employees Retirement Plan shall be amended to read as follows:
Section 1. Death of An Active Member, a Disabled Member or a Vested
Member Prior to Normal Retirement Date. In the event that a Member who is
actively employed in Covered Employment or a Disabled Member dies prior to the
commencement of his or her Retirement Benefit, a single-sum death benefit will be
paid to the Member's beneficiary. The single-sum death benefit will be determined
such that it is equal to 47% of the Actuarial Equivalent value of the life annuity
benefit which would have been paid had the Member separated from service at the
earlier of the actual time of separation or death, survived until the earliest retirement
age(or date of death, if later) and retired with a life annuity. If the beneficiary is the
Member's spouse, the spouse may elect a monthly benefit which is the actuarial
equivalent of the single-sum death benefit. The monthly benefit to the surviving
spouse shall commence on the last day of the month following the later of the
Member's 55th birthday or the Member's date of death and be payable for the
spouse's life. If the participant was not married at the time of death,the beneficiary
will receive the single-sum death benefit. If no beneficiary exists, the estate will
receive the single-sum death benefit.
For beneficiaries of Members who commenced Covered Employment prior
to June 1, 1998, the actuarial equivalence for the single-sum death benefit will be
determined by using the interest rate specified in subsections b(1)and b(3)of section
2 of Article II of this Plan. For beneficiaries of Members who commenced Covered
Employment on or after June 1, 1998, the actuarial equivalence for the single-sum
death benefit will be determined by using the interest rate specified in subsections
b(2)(b) and b(3) of section 2 of Article 11 of this Plan.
In the event that a Vested Member who became such after January 1, 1994,
and, thus, accrued Credited Service after December 31, 1993, dies prior to
commencement of his or her Retirement Benefit. a death benefit will be paid. This
death benefit shall be paid as set forth in the first paragraph of this section. Death
benefits, if any,payable to any Vested Member who became such prior to January 1,
1994 and did not accrue any Credited Service after December 31, 1993 shall be
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determined in accordance with the provisions of the Plan as of the date the Member
ceased to be in Covered Employment.
Section 5. That effective June 1, 1998, Section 5 of Article VIII of the City of Fort Collins
General Employees Retirement Plan shall be amended to read as follows:
Section 5. Minimum Periodic Payment. If the amount of the
monthly benefit payable to a spouse or Beneficiary is less than$100,the spouse or
Beneficiary shall be paid a single-sum equal to the Actuarial Equivalent of such
benefit. For spouses and beneficiaries of Members who commenced Covered
Employment prior to June 1, 1998,said Actuarial Equivalent specified in this section
5 shall be as defined by subsections b(l) and b(3) of section 2 of Article II of this
Plan. For spouses and beneficiaries of Members who commenced Covered
Employment on or after June 1, 1998, said Actuarial Equivalent specified in this
section 5 shall be as defined by subsections b(2)(b) and b(3) of section 2 of Article
II of this Plan.
Section 6. That effective June 1, 1998, Section 6 of Article VIII of the City of Fort Collins
General Employees Retirement Plan shall be deleted.
Section 7. That effective June 1, 1998, Section 2 of Article IX of the City of Fort Collins
General Employees Retirement Plan shall be amended and a new Section 3 of said Article shall be
added, both to read as follows:
Section 2. Two or More Years of Service. In the event a Member's
employment terminates prior to his Normal Retirement Date, and he or she has two
or more years of Credited Service, he or she shall become a Vested Member. A
Vested Member shall be entitled to a deferred Retirement Benefit which shall be the
vested portion(as shown in the table below)of his or her Accrued Benefit on the date
of the termination of his or her Credited Service.
Completed Years Percent of Vested
Of Credited Service Accrued Benefit
Less than 2 0%
2 40%
3 60%
4 80%
5 or more 100%
Such deferred Retirement Benefit shall be payable at the Vested Member's Normal
Retirement Date.
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In lieu of receiving a deferred Retirement Benefit upon his or her Normal
Retirement Date, the Vested Member may elect to receive a reduced Retirement
Benefit beginning upon the last day of any month subsequent to his or her attainment
of age 55. The reduction shall be 1/180 for each of the first 60 months and 1/360 for
each additional month beyond the first 60 months by which payments commence
prior to the first of the month following his or her Normal Retirement Date.
Section 3. Single Lump Sum Benefit. In lieu of receiving a monthly
Retirement Benefit upon his or her Normal or Early Retirement Date as set forth in
section 2, above, the Vested Member may, following termination of Covered
Employment but not less than 30 days prior to the due date of the first payment of the
Normal or Early Retirement Benefit, elect in writing to receive a single-sum equal
to the Actuarial Equivalent of such deferred Retirement benefit, as defined by
subsections b(2)(b)and b(3)of section 2 of Article II of this Plan. If so elected, such
single-sum shall be paid within 90 days of the receipt of the written request.
If the deferred Retirement Benefit to which a Vested Member will be entitled
at his or her Normal Retirement Date is less than $100.00 per month, the Vested
Member shall not have the election set forth in the previous paragraph and he or she
shall be paid, within 90 days of termination of Covered Employment, a single-sum
equal to the Actuarial Equivalent of such deferred Retirement benefit, in lieu of all
other benefits due to such Vested Member under this Plan. For Vested Members
who commenced Covered Employment prior to June 1, 1998, said Actuarial
Equivalent specified in this paragraph shall be as defined by subsections b(2)(a)and
b(3) of section 2 of Article II of this Plan. For Vested Members who commenced
Covered Employment on or after June 1, 1998, said Actuarial Equivalent specified
in this paragraph shall be as defined by subsections b(2)(b) and b(3) of section 2 of
Article II of this Plan.
Passed and adopted at a regular meeting of the Council fidthe ity of Fo ollins hel this
19th day of May, A.D. 1998.
Mayor
ATTEST:
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City Clerk
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