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CITY OF CLERMONT
FIREFIGHTERS PENSION BOARD OF TRUSTEES
RESOLUTION NO.4
A RESOLUTION OF THE CITY OF CLERMONT FIREFIGHTERS
PENSION BOARD OF TRUSTEES REQUESTING THE CITY COUNCIL
OF THE CITY OF CLERMONT, FLORIDA TO ADOPT AN ORDINANCE
TO AMEND THE CITY OF CLERMONT PENSION PLAN AS ADOPTED BY
ORDINANCE NO. 305-C ON FEBRUARY 27, 2001; PROVIDE FOR
CONFILICTING RESOLUTIONS; PROVIDE FOR PLAN BENEFIT
IMPROVEMENT LIMITATIONS; AND PROVIDE FOR AN EFFECTIVE
DATE.
WHEREAS, the City of Clermont Firefighters are presently provided pension benefits under
Ordinance No. 305-C adopted on February 27, 2001,
WHEREAS, members of the City of Clermont Firefighters Pension Plan rejected the pension
changes approved by the City of Clermont Firefighters Pension Board of Trustees as part of the
City of Clermont Firefighters Pension Board of Trustees Resolution No. 3;
WHEREAS, the City of Clermont Firefighters Pension Board of Trustees desires to amend the
provisions of the City of Clermont Pension Plan;
NOW, THEREFORE BE IT RESOLVED BY THE CITY OF CLERMONT FIREFIGHTERS
PENSION BOARD OF TRUSTEES, THAT:
SECTION 1:
Section G.2. (Normal Retirement Benefit) of the Adoption Agreement shall be amended to read
as follows:
The monthly normal retirement benefit for full-time firefighters shall be the sum of (1) the number
of years service prior to October 1, 2002 multiplied by 2.25% and (2) the number of years of
service after October 1, 2002, multiplied by 3% and multiplied by average final compensation.
The monthly normal retirement benefit for volunteer firefighters shall be the greater of:
(a) five ($5.00) a year multiplied by the years of credited volunteer service, or
(b) the sum of (1) the number of years of credited volunteer service prior to October
1, 2002 multiplied by 2.25% and (2) the number of years of credited volunteer
service after October 1, 2002 multiplied by 3% and multiplied by average monthly
compensation as a volunteer firefighter.
SECTION 2:
Section J. (Termination of Employment and Vesting) of the Adoption Agreement shall be
amended to read as follows:
If a member's employment is terminated either voluntarily or involuntarily the following benefits
are payable.
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1) If the member has less than five (5) years of credited service upon termination of
employment, the member shall be entitled to a refund of his accumulated
contributions or the member may leave the accumulated contributions deposited
with the fund.
2) If a member has more than five (5) and less than ten (10) years of credited
service upon termination of employment, the member shall be entitled to their
accrued monthly benefit, starting at the member's otherwise normal or early
retirement date, provided he does no elect to withdraw his contributions and
provided he survives to his normal or early retirement date, in accordance with
the following schedule:
Years of Vesting
Service
5 50%
6 60%
7 70%
8 80%
9 90%
For purposes of this section only, a member may start drawing his vested
accrued benefit at the age of 55. Early retirement reduction will be based on the
years between the age of 55 and the early retirement date.
3) If the member has ten (10) or more years of credited service upon termination of
employment, the member shall be entitled to their accrued monthly retirement
benefits, starting at the member's otherwise normal or early retirement date,
provided he does not elect to withdraw his contributions and provided he survives
to this normal or early retirement date. Early and normal retirement dates are
based on actual years of service.
SECTION 3'
Section M. (Deferred Retirement Option Program -"DROP" of the Adoption Agreement shall be
amended to read as follows:
ELIGIBILITY.
A participant of the City of Clermont Firefighters' Pension Plan may enter into
a Deferred Retirement Option Plan ("DROP") on the first day of the month following the
attainment of normal retirement date as defined in the Plan Adoption Agreement.
Participants who attained their normal retirement date prior to the enactment of the
"DROP" shall be afforded the option of participating immediately or retroactively to the
date that they actually attained their normal retirement date. This option must be
exercised no later than (60) days after the Board provides notice of this option to the
affected employee.
II. WRITTEN ELECTION.
A participant electing to participate in the "DROP" must complete and execute
the proper forms supplied by the plan and a resignation of employment.
Election into the "DROP" is irrevocable once a participant completes the
application to enter the "DROP".
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III. LIMITATION AND DISQUALIFICATION FOR OTHER BENEFITS.
A participant may participate in the "DROP" only once. After commencement of
participation the employee shall no longer earn or accrue additional vesting credits
toward retirement benefits and shall not be eligible for disability or pre-retirement death
benefits in the City of Clermont Firefighters' Pension Plan.
IV. CESSATION OR REDUCTION OF CONTRIBUTIONS.
Upon the effective date of a participant's commencement of participation in the
"DROP", the participant's contributions to the City of Clermont Firefighters' Pension Plan
will be discontinued.
V. BENEFIT CALCULATIONS.
For all City of Clermont Firefighters Pension Plan purposes, the service and
vesting credits of a participant participating in the "DROP" shall remain as they existed on
the effective date of commencement of participation in the "DROP". The participant shall
not earn or be credited with any additional vesting credits after beginning "DROP"
participation. Service thereafter shall not be recognized by the City of Clermont
Firefighters' Pension Plan or used for the calculation or determination of any benefits
payable by such Plan.
The average final compensation of the participant shall remain as it existed on
the effective date of commencement of participation in the "DROP". Payment for accrued
unused leave (vacation, holiday, etc.) shall be made, at the option of the participant, from
one of the following choices:
when commencing participation in the "DROP", or
2. as the leave is actually used during participation in the "DROP", or
3. when the participant actually terminates employment with the City.
Earnings thereafter shall not be recognized by the Plan or used for the calculation or
determination of any benefits payable by the Plan. However, the value of any retirement
gift provided by the City shall be based on the date that a participant actually leaves
employment with the City including the "DROP" participation period.
VI. PAYMENTS TO DROP ACCOUNT.
The monthly retirement benefits that would have been payable had the member
elected to cease employment and receive normal retirement benefits shall be deposited
into the participant's "DROP" account.
VII. DROP ACCOUNT EARNINGS.
After each fiscal year quarter, the average daily balance in a participant's
deferred retirement option account shall be credited at a rate of six and one-half percent
(6.5°/a) annual interest compounded monthly. The Board of Trustees along with the City
shall review the stated rate of return on an annual basis in order to determine the
necessity of any adjustment.
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VIII. MAXIMUM PARTICIPATION.
A participant may participate in the "DROP" for a maximum of sixty (60) months.
At the conclusion of the sixty (60) months, the participants' covered city employment
must terminate pursuant to the resignation submitted by the participant as part of the
"DROP" application. The participant may terminate "DROP" participation by advancing
their resignation form covered city employment to a date prior to that submitted by the
participant as part of the "DROP" application.
IX. PAYOUT
A. Upon the termination of a member's covered City employment (for any
reason, whether by retirement, resignation, discharge or death), the
retirement benefits payable to the participant or the participant's
beneficiary (if the participant selected an optional form of retirement
benefit which provides for payments to the beneficiary) shall be paid to
the member or beneficiary and shall no longer be deposited into the
participant's "DROP" account.
B. Within thirty (30) days after the end of any calendar quarter following the
termination of a participant's employment, the balance in the participant's
"DROP" account shall be payable at the participant's option:
In full in a single lump sum payment, all accrued "DROP"
benefits, plus interest, less withholding taxes remitted to the
Internal Revenue Service (IRS), paid to the "DROP" participant
or surviving beneficiary, or;
2. As a direct rollover, all accrued "DROP" benefits, plus interest,
paid directly from the "DROP" to the custodian of an eligible
retirement plan as defined in Section 402(c)(8)(B), Internal
Revenue Code (IRC). If benefit is to be paid to a surviving
beneficiary, the transfer shall be to an individual retirement
account or annuity as described in Section 402(c)(9), IRC.
3. Partial lump sum - A portion of the accrued "DROP" benefits
shall be paid to the participant or surviving beneficiary, less IRS
tax, and the remaining "DROP" benefits shall be transferred
directly to the custodian of an eligible retirement plan as defined
in Section 402(c)(8)(B), IRC. However, in the case of an eligible
rollover distribution to the surviving beneficiary of a deceased
participant, an eligible retirement plan is an individual retirement
account or annuity as described in Section 402(c)(9), IRC. The
"DROP" participant or surviving beneficiary shall specify the
proportions.
Regardless of the option selected by the participant, the Board of Trustees has
the right to accelerate payments in order to comply with Section 401(A)(9) of the
Internal Revenue Code and the right to defer payments to comply with Section
415 of the Internal Revenue Code.
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X. DEATH
If a "DROP" participant dies before their account balances are paid out in full, the
participant's designated beneficiary shall have the same rights as the participant to elect
and receive the payout options set forth in paragraph ten (X) above. "DROP" payments
to a beneficiary shall be in addition to any retirement benefits payable to the participant.
Participants who are or have been "DROP" participants are not eligible for pre-retirement
death or disability benefits.
XI. FORMS
The forms and notices approved by the City shall be used in the administration of
The "DROP" Plan.
XII. AMENDMENT
The Board of Trustees, upon approval by the City Council, can amend the
"DROP" at any time. Such amendments shall be consistent with the provisions covering
deferred retirement option plans set forth in any applicable collective bargaining
agreement and shall be binding upon all future "DROP" participants and upon all "DROP"
participant's who have balances in their accounts. Such amendments may increase the
expense, decrease the account earnings, or limit or restrict the payout options.
SECTION 4:
All resolution or parts of resolutions in conflict herewith be and the same are hereby repealed.
SECTION 5:
Plan benefit improvements provided by this resolution shall apply prospectively and shall not
apply to any Plan Member who has terminated employment or who has retired prior to the
effective date of this resolution.
SECTION 6:
That this resolution shall be effective immediately.
DONE AND RESOLVED BY THE CITY OF CLERMONT FIREFIGHTERS PENSION BOARD
OF TRUSTEES THIS 30TH DAY OF OCTOBER 2002.
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P UL ANDERSO
CHAIRMAN
RICHARD BELL
SECRETARY
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