HomeMy WebLinkAbout4996
ORDINANCE NO. .(/99(,
AN ORDINANCE of the City Council of the City of
Bremerton, Washington, amending and restating in its entirety City
of Bremerton's 457(b) Deferred Compensation Plan and dissolving
the Deferred Compensation Committee.
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i WHEREAS, the City adopted an employee 457(b) Deferred Compensation Plan
: adopted by Resolution No. 1649 and amended by Resolution No. 1918, and
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: WHEREAS, part of the Plan created a Deferred Compensation Committee to
! administer the plan for the City of Bremerton, and
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I WHEREAS, the City Council desires to amend the plan to update its provisions
: consistent with the Internal Revenue Code and Treasury Regulations, and
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. WHEREAS, the City Council also desires to dissolve the Committee and allow
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! for City staff to be appointed by the Mayor to administer the amended Plan, NOW,
: THEREFORE,
THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON,
I DOES HEREBY ORDAIN AS FOLLOWS:
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I SECTION 1. City of Bremerton's 457(b) Deferred Compensation Plan as adopted
; by Resolution No. 1649 and as amended by Resolution No. 1918 and as it may have otherwise
i been subsequently amended is hereby amended in entirety and restated as the City of
: Bremerton's 457(b) Deferred Compensation Plan, which is attached hereto as Exhibit A and
! incorporated as if fully set forth herein.
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SECTION 2. The Deferred Compensation Committee as created by Resolution
: No. 1649 and Resolution No. 1871 as confirmed in adoption of the current Plan pursuant to
, Resolution No. 1918 is hereby dissolved, and the Mayor is authorized, as set forth in the
! amended Plan, to appoint city official(s) to administer the Plan for the City.
SECTION 3. Severability. If anyone or more section, subsections, or sentences
I of this Ordinance are held to be unconstitutional or invalid, such decision shall not affect the
validity of the remaining portion of this ordinance and the same shall remain in full force and
effect.
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Deferred Compensation Plan
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I SECTION 4. Effective Date. This ordinance shall take effect and be in force ten
PO) days from and after its passage, approval and publication as provided by law.
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if> ASSED by the City Council the / 7~..A )
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day of ~~ a~ .A-<;
,2007.
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IAPproved this
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WILL MAUPIN,
/i:/.li dayof (ji-p.m4j. '20~
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CARY OZEMAN, Mayor
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IATTEST:
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APPROVED AS TO FORM:
: PUBLISHED the~L dayof
EFFECTIVE the I~~ day of
ORDINANCE NO. ~q 'it.,
~-~ ~
~G~UBOV;~~ A - .Y ---. -.
~ ,2007.
____ , 2007.
I R:\Legal\Legal\Ordinances\Human Resources\Deferred Compensation Plan.doc
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Deferred Compensation Plan
CITY OF BREMERTON
AMENDED AND REST A TED 457(b)
DEFERRED COMPENSATION PLAN
The Employer, by approval and execution of this document, hereby amends in its
lentirety and restates the City of Bremerton's 457(b) Deferred Compensation Plan as adopted by
!Resolution No. 1649 and as amended by Resolution No. 1918 and as it may have otherwise been
;subsequently amended ("Prior Plan"). The Prior Plan as amended herein and as set forth in the
Iprovisions of this document is hereinafter referred to as the "Plan".
ARTICLE I. PURPOSE
1.01 The primary purpose of this Plan is to provide retirement income and other
deferred benefits to the Employees of the Employer and the Employees' Beneficiaries in
accordance with the provisions of Section 457 of the Internal Revenue Code of 1986, as
amended (the "Code") and the applicable Treasury Regulations.
ARTICLE II. DEFINITIONS
2.01 For purposes of this Plan, the following terms shall have the following meanings:
a) "Account" means the bookkeeping account maintained for each Participant reflecting the
cumulative amount of the Participant's Deferred Compensation, including any income,
gains, losses, or increases or decreases in market value attributable to the Employer's
investment of the Participant's Deferred Compensation, and further reflecting any
distributions to the Participant or the Participant's Beneficiary and any fees or expensed
charged against such Participant's Deferred Compensation.
b) "Administrator" means the person or persons named to carry out certain
nondiscretionary administrative functions under the Plan.
c) "Beneficiary" or "Designated Beneficiary" means the person properly designated by a
Participant to receive the Participant's benefit under this Plan in the event of the
Participant's death, or, if none, the Participant's estate.
d) "Deferred Compensation" means the portion of Includable Compensation not yet
earned, which the Participant and Employer mutually agree shall be deferred, any amount
credited to a Participant's Account by reason of a transfer under this Plan, or any other
amount which the Employer agrees to credit to a Participant's Account in accordance
with the provisions of this Plan and IRC 457(b).
e) "Eligible Deferred Compensation Plan" means a plan established and maintained by an
agency that complies with IRC 457 (b).
t) "Eligible Rollover Account" means the separate bookkeeping account maintained by the
Administrator within the Plan for a Participant for amounts of Eligible Rollover
Distributions as defined in IRC Section 402(c)(4), including eligible rollover distributions
to a surviving spouse under IRC Section 402(c)(9).
g) "Eligible Retirement Plan" means an eligible retirement plan as defined in IRC Section
402(c)(8)(B).
h) "Employee" means any person who receives compensation trom the Employer for
services rendered to the Employer, including, but not limited to, appointed and elected
ofticials and salaried employees. Employee includes regular full time or part time
employee but does not include temporary employees as detined by Employer.
i) "Employer" means City of Bremerton, Washington, the Plan Sponsor.
j) "Employer Administrator" means the City official(s) designated by the Mayor to make
discretionary decisions in the administration of this Plan.
k) "Includable Compensation" means the amount of an Employee's compensation from
the Employer for a taxable year that is attributable to services performed for the
Employer and that is includable in the Employee's gross income for the taxable year for
federal income tax purposes; such term does not include any amount excludable from
gross income under this Plan or any other plan described in Section 457(b) of the Code or
any other amount excludable from gross income for federal income tax purposes.
Includable Compensation shall be determined without regard to any community property
laws.
1) "Income Attributable" is gains from the disposition of property and shall be treated as
income attributable to such property.
m) "IRC" means the Internal Revenue Code of 1986, as now in effect or as hereafter
amended.
n) "Normal Retirement Age" means the age specified in writing by the Participant. The
Normal Retirement Age specified by the Participant must be an age at which the
Participant is eligible to retire pursuant to either the LEOFF or PERS retirement system,
by virtue of age, length of service, or both, without consent of the Employer and with the
right to receive immediate retirement benefits without actuarial or similar reduction
because of retirement before some later specified age.
0) ..Participant" means an employee who is eligible to defer compensation under this Plan,
and who has executed a Participation Agreement and who retains rights to benefits under
this Plan.
p) '.Participation Agreement" means an agreement entered into between an Employee and
the Employer, including any amendments or modifications thereof. Such agreement shall
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fix the amount of Deferred Compensation, specify a preference among the investment
alternatives designated by the Employer, designate the Employee's Beneficiary or
Beneficiaries, and incorporate the terms, conditions, and provisions of the Plan by
reference.
q) "Plan" means the Deferred Compensation Plan for Employees as set forth in this
document and as amended from time to time.
r) "Plan-to-Plan Transfer" means a transfer of assets from one eligible governmentallRC
Section 457(b) plan to another eligible governmental IRC Section 457(b) plan.
s) "Plan Year" means the calendar year.
t) "Prior Plan" means the City of Bremerton's 457(b) Deferred Compensation Plan as
adopted by Resolution No. 1649 and as amended by Resolution No. 1918 and as it may
have otherwise been subsequently amended.
u) "Separation of Service" means the severance of the Participant's employment with the
Employer which constitutes a "separation from service" within the meaning of Section
402(d)(4)(A)(iii) ofthe Code. In general, a Participant shall be deemed to have severed
his employment with the Employer for purposes of this Plan when, in accordance with
the established practices of the Employer, the employment relationship is considered to
have actually terminated.
ARTICLE III. ADMINISTRATION
This Plan shall be administered as follows:
3.01 Duties of the Employer. The Employer shall have the authority to make all
discretionary decisions affecting the rights or benefits of Participants which may be required in
the administration of this Plan. The Employer, through the Mayor, may designate one or more
City officials to perform these functions (collectively, "Employer Administrator". The Employer
Administrator may 1) establish rules and procedures to implement this Plan, 2) enter into
agreements with Plan Administrators approved by the Employer's legislative body to administer
the Plan, 3) make reasonable interpretations of the provisions of the Plan and 4) make minor
amendments to the Plan when required to be consistent with and in compliance with the
applicable provisions of the IRC and Treasury Regulations. The Employer Administrator's
decisions shall be afforded the maximum deference permitted by applicable law.
3.02 Duties of the Administrator. The Administrator, as agent for the Employer,
shall perform nondiscretionary functions in connection with the Plan, induding the maintenance
of Participant's Accounts, the provision of periodic reports of the status of each Account, and the
distribution of benefits on behalf of the Employer in accordance with the provisions of this Plan.
3.03 Disbursement Pursuant to Plan. Employer shall disburse those amounts which
arise from duly executed Participation Agreements. A duly executed Participation Agreement
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shall bear the signatures of the Participant. Each employee's Participation Agreement shall
become a part of this Plan and is incorporated herein by this specific reference thereto.
3.04 Benefits held in Trust. All amounts deferred under the Plan, all property and
rights purchased with such amounts, and all Income Attributable to such amounts, property, or
rights, must be held in trust for the exclusive benefit of the Participants and their beneficiaries.
3.05 Individual Accounts. An individual account shall be maintained in the name of
each Participant, to which amounts deferred shall be credited.
3.06 Assets of Accounts. With respect to each account hereunder, all dividends,
interest, gains, rents and other increments thereon, shall be credited to such account, and the
assets of each account shall be valued not less than once each year at present value.
3.07 Appointment of Administrator(s). The Employer's legislative body shall have
the authority to appoint Administrator(s) to carry out the terms and conditions of this Plan.
3.08 Limitation of Liability. The Employers liability is limited as follows:
(a) Employer shall not be required to invest assets nor be responsible for any
loss due to the investment or failure of investment of funds and assets in said deferred
compensation account nor shall Employer be required to replace any loss whatsoever which may
result from said investments.
(b) The Employer shall assume or incur no obligations hereunder except to
exercise due care with respect to the assets from time to time in their custody hereunder pending
application thereof as provided in this Agreement and to exercise due diligence in carrying out
their duties and functions under this Agreement. The Employer shall not be liable for any loss
unless such loss is caused by a breach of its obligations under this Plan.
ARTICLE IV. PARTICIPATION
4.01 Eligibility. Any Employee shall be eligible to participate and defer compensation
under this Plan and upon becoming employed by the Employer.
4.02 Election to Participate. Any Employee may elect to be a Participant by
executing and filing with the Administrator a Participation Agreement consenting to defer a
portion of his or her salary by the deferral amount specified in the Participation Agreement. The
amount of Deferred Compensation must equal at least $20.00 per month. This minimum amount
may be changed by the Employer from time to time. The Participation Agreement shall include a
designation of a Beneficiary. Such Beneficiary designation shall remain in effect until the
Participant files an executed amendment with the Administrator designating a new Beneficiary.
The Employee shall become a Participant as soon as administratively possible following the
Employee's filing of a completed and executed Participation Agreement, or as otherwise
pennitted by law. Compensation may be deferred for any calendar month only ifthe
Participation Agreement has been entered into before the first day of the month in which
compensation is paid or made available.
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4.03 Amendments. The Participant may amend a Participation Agreement in order to,
(a) Change the allocation of the investment of any contribution;
(b) Change the amount of compensation to be deferred;
(c) Change the Designated Beneficiary; or
(d) Any other amendment authorized in the Plan or by law.
A Participant may amend an executed Participation Agreement to change the amount of
: compensation not yet earned which is to be deferred (including the reduction of such future
i deferrals to zero) or to change his or her investment preference (subject to such restrictions as
· may result from the nature of terms of any investment made by the Employer or its agents).
; Amendments are made by filing with the Administrator an amendment on a form and in the
; procedural manner approved by the Administrator. Any amendment to a Participation Agreement
· shall be effective prospectively only and shall be effective as early as administratively possible,
but not earlier than the first day of the calendar month in which the compensation is paid or made
available.
ARTICLE V. DEFERRED COMPENSATION
5.01 Maximum 457(b) Contribution Limit. Except as provided in Sections 5.02 and
, 5.03, the maximum deferred amount under the Plan for the Participant's taxable year shall not
i exceed the lesser of (a) the maximum dollar amount under IRC Section 457(b) (2) (A) and as
, adjusted for cost ofliving adjustments described in IRC Section 457(e) (15), both provisions as
i currently enacted and hereinafter amended, or (b) 100% of the Participant's Includable
: Compensation as provided in IRC Section 457(b) (2) (B). For 2006, this amount is $15,000.
5.02 Special 457(b) Catch-Up Deferral. For one or more of the Participant's last
I three taxable years ending before the attainment of Normal Retirement Age under the Plan, the
. maximum deferral shall be the lesser of
(a) twice the applicable dollar amount set forth in Section 5.01; or
(b) the sum of;
(i) The limitation established for the taxable year under Section 5.01,
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, (ii) The limitation established for purposes of Section 5.01 for each of
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I the prior taxable years during which the Participant was eligible to participate less the amount of
i Compensation deferred by the Participant under the Plan for each of such prior taxable years.
5.03 Age 50 Catch-Up Deferral. The maximum deferral amount described in Section
I 5.01 under the Plan for the Participant's taxable year is increased for a Participant who has
I attained age 50 or over by the end of the taxable year. The amount permitted under this Section
I shall be the greater of
(a) The amount set forth in section 5.01 (without regard to Section 5.02), plus
: the applicable dollar amount set forth in IRC Section 4l4(v)(2)(B) and as adjusted for cost of
: living adjustments described in IRC Section 4l4(v)(2)(C), both provisions as currently enacted
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, and hereInafter amended, or
(b) The amount determined under any other applicable Section of this Plan
(without regard to this Section).
For 2006, the applicable dollar amount set forth in IRC Section 4 I 4(v)(2)(B) is $5,000.
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5.04 Participation in more than one Plan. The amount excludable from a
'Participant's gross income under this Plan or any other eligible deferred compensation plan
'under section 457 of the Code shall not exceed the maximum amount allowed under this Article
less any amount excluded from gross income under section 403(b), 402(a)( 8), or 402(h)( 1 )(B) of
:the Code, or any amount with respect to which a deduction is allowable by reason of a
icontribution to an organization described in section 501(c)(18) of the Code. Consequently, an
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: Employee who participates in more than one plan (whether or not maintained by the same
Isponsor) must allocate the dollar limitation among the plans in which he or she participates.
5.05 Participation in Tax-Sheltered Annuity. If and individual who participates in
an eligible deferred compensation plan also participates in a tax-sheltered annuity probTfam,
contributions that are excludable from his or her gross income under Code Sec. 403 (b) reduce
the limitation, under Code Sec. 457, on the amount of compensation which may be deferred
under the eligible deferred compensation plan. For purpose of computing the exclusion under
Code Sec. 403 (b), an amount deferred in an earlier taxable year under an eligible State deferred
compensation plan (with regard to the sponsoring entity) is treated as an amount contributed by
the employer and excluded by the employee under Code Sec. 403 (b), if the taxable year of the
I deferral counts as a year of service for purposes of Code Sec. 403 (b).
5.06 Uniformed Services Employment and Reemployment Rights Act of 1994.
: Notwithstanding the preceding provisions of Article IV, A Participant who is entitled to
i reemployment pursuant to the terms of the Uniformed Services Employment and Reemployment
; Rights Act of 1994 (USERRA) may defer an additional amount under the Plan as provided in
: that Act for the years of his or her service in the uniformed services (as defined in USERRA).
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, Any such deferrals will not be subject to the limits set forth above in the year in which deferred,
, but will be subject to the limits for the year to which such deferrals relate.
5.07 Leaves of absence. Unless a deferral election is otherwise revised, if a Participant
! is absent from work due to leave of absence, deferrals under the Plan shall continue to the extent
: that Compensation continues including compensation from accumulated sick and vacation leave.
ARTICLE VI. EMPLOYER CONTRIBUTIONS
6.01 The Employer may contribute to the Plan for Participants. Employer
, contributions shall vest at the time such contributions are made. For purposes of administering
ARTICLE V relating to deferral of compensation, Employer contributions shall apply toward the
maximum deferral limits in the Plan Year.
ARTICLE VII. DISTRIBUTION OF BENEFITS
7.01 Commencement of Distributions. Except for Unforeseeable Emergency
I withdrawals pursuant to Article VIII or otherwise specifically allowed by the Plan, distributions
from the Plan may not be made to a Participant earlier than:
(a) the calendar year in which the Participant attains age 70 V2; or
(b) the Participant retires or otherwise has a severance from employment. All
irrevocable elections of a benefit commencement date by a Participant or a Beneficiary made
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! prior to January 1,2002 and defaulted distributions (other than a defaulted distribution to an
, annuity option) may be voided at the election of the Participant or the Beneficiary.
7.02 Election of Benefit Commencement Date. A Participant may elect to
, commence distributions of benefits at any time after retirement or other Severance from
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. Employment, as determined and confirmed by the Plan Sponsor by a notice filed with the
i Administrator before the date on which benefits are to commence. The entire trust shall be
I distributed to the Participant not later than the Required Beginning Date described in Section
: 7.05 or shall be distributed, beginning not later than the Required Beginning Date, over the life
: of such Participant or over the lives of such Participant and a Designated Beneficiary, or over a
; period not extending beyond the life expectancy of such Participant and Designated Beneficiary,
; as provided by regulations. However, in no event may distribution of benefits commence later
! than the date described in Section 7.05, Required Beginning Date.
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7.03 Forms of Distribution. Benefits shall be paid in accordance with the payment
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: option elected by the Participant. Payment, method of payment, and settlement options are
i available as provided by each of the available investment specifications. The Participant shall
: elect the method of payment based upon the options then available under the Plan, including but
I not limited to lump sum distributions, periodic payment by fixed amount, periodic payment by
; fixed time period, partial lump sum payment or purchased annuity. A Participant or Beneficiary
: who has chosen a payment option, other than the purchased annuity option, shall have the ability
: to change his payment option subject to any restrictions or limitations imposed by the Plan, the
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; Administrator, an investment option provider, any regulatory agency, or as otherwise required by
. law.
7.04 Treasury Regulations Incorporated into Plan. All distributions required under
this Article VII will be determined and made in accordance with the Treasury Regulations under
I promulgated under IRC Section 401 (a)(9).
7.05 Required Beginning 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, which is to begin no later than April 1 of the calendar year following the later of the
I calendar year in which the Participant attains age 70 Y2 or has a Severance from Employment.
7.06 Required Minimum Distributions. All distributions under the Plan must
comply with IRC Section 401(a) (9) and the regulations issued thereunder.
(a) Participant dies before entire interest is distributed. If a Participant
dies after the distribution of the Participants interest has begun but before the entire interest has
been distributed to him or her, the remaining portion of such interest will be distributed to the
: Beneficiary at least as rapidly as under the method of distribution in effect at the time of the
Participant's death.
(b) Participant dies before the distribution of the employee's interest has
i begun. If a Participant dies before the Required Beginning Date of distribution, payments to a
Beneficiary must comply with one of the following requirements:
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! (i) Generally. The entire account value must be distributed within 5
I years after the death of such Participant's death; or
(ii) Designated Beneficiary. If the Designated Beneficiary is a person
other than the Participant's spouse, distributions to the Designated Beneficiary of the account
must begin no later than I year (or such later date as prescribed by the IRC or Treasury
regulations) after the date of the Participant's death, payable over a period not extending beyond
, the life expectancy of the Beneficiary; or
(iii) Spouse as Designated Beneficiary. If the Designated Beneficiary
is the Participant's surviving spouse, distributions to the surviving spouse must begin no later
than I year (or such later date as prescribed by the IRC or Treasury regulations) after either I)
the date of death of the participant or 2) the date which the Participant would have attained age
70 Y2 , whichever is later. The account must then be paid over a period not extending beyond the
life expectancy of the spouse.
(c) If the Participant dies before the date distributions begin, the Participant's
surviving Spouse is the Participant's Designated Beneficiary, and the surviving Spouse dies
before distributions are required to begin, this Article VII will apply as if the surviving Spouse
i were the Participant.
(d) Ifthe Beneficiary is not a person, such as a trust or an estate, the entire
I account value must be distributed according to the five-year rule in (b) (i) above.
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ARTICLE VIII. UNFORSEEABLE EMERGENCY DISTRIBUTIONS
8.01 Distribution. If the Participant has an Unforeseeable Emergency before
retirement or other Severance from Employment, the Participant may elect to receive a lump sum
i distribution equal to the amount requested or, if less, the maximum amount determined by the
Administrator to be permitted to be distributed under this Article VIII.
8.02 Unforeseeable Emergency Defined. An Unforeseeable Emergency is defined as
a severe financial hardship of the Participant resulting from: an illness or accident of the
Participant, the Participant's Spouse, or the Participant's dependent (as defined in IRC Section
1 52(a)); loss of the Participant's property due to casualty (including the need to rebuild a home
following damage to a home not otherwise covered by homeowners insurance, e.g. as a result of
a natural disaster); the need to pay for the funeral expenses of the Participant's Spouse or
dependent (as defined in IRC Section 1 52(a)); or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the Participant, or as otherwise
permitted by law. For example, the imminent foreclosure of or eviction from the Participant's
primary residence may constitute an Unforeseeable Emergency. In addition, the need to pay for
medical expenses, including non-refundable deductibles, as well as for the cost of prescription
drug medication, may constitute an Unforeseeable Emergency. Except as otherwise specifically
provided in this Article, neither the purchase of a home nor the payment of college tuition is an
Unforeseeable Emergency.
8.03 Unforeseeable Emergency Distribution Standard. A Distribution on account
of Unforeseeable Emergency may not be made to the extent that such emergency is or may be
relieved through reimbursement or compensation from insurance or otherwise, by liquidation of
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the Participant's assets, to the extend the liquidation of such assets would not itself cause severe
financial hardship, or by cessation of deferrals under the Plan, or as otherwise permitted by law.
8.04 Distribution Necessary to Satisfy Emergency Need. Distributions because of
an Unforeseeable Emergency may not exceed the amount reasonably necessary to satisfy the
emergency need (which may include any amounts necessary to pay any federal, state, or local
income taxes or penalties reasonably anticipated to result fro the distribution)
ARTICLE IX. ELIGIBLE ROLLOVERS AND PLAN-TO-PLAN TRANSFERS
9.01 Eligible Rollovers to the Plan.
(a) Incoming Rollover Contributions. A Participant who is entitled to
receive an Eligible Rollover Distribution from another Eligible Retirement Plan may request to
have all or a portion of the Eligible Rollover Distribution paid to the Plan, provided,
(I) the Eligible Rollover Distribution is made entirely in the form of
U.S. dollars, and,
(2) the Participant demonstrates to the Administrator's satisfaction that
the amount is a qualifying Eligible Rollover Distribution under IRC Sections 402(c)(4),
403(a)(4), or 408(d)(3),
(b) Definitions of Eligible Rollover Distribution. For purposes of Section
9.0 I (a) Incoming Rollover Contributions, an Eligible Rollover Distribution means any
contribution of all or any portion of a Participant's benefit under another Eligible Retirement
Plan to the Plan, except that an Eligible Rollover Distribution does not include:
(i) any installment payment for a period of 10 years or more,
(ii) any distribution made as a result of an Unforeseeable Emergency,
or
(iii) For any other distribution, the portion, if any, of the distribution
that is a required minimum distribution under IRC Section 401 (a)(9).
(c) Separate Account for Eligible Rollover Contributions. The Plan shall
establish and maintain for the Participant an Eligible Rollover Account for any Eligible Rollover
Distribution paid to the Plan from any Eligible Retirement Plan that is not an eligible
governmental plan under IRC Section 457(b). In addition, the Plan shall establish and maintain
for the Participant an Eligible Rollover Account for any Eligible Rollover Distribution paid to
the Plan from any Eligible Retirement Plan that is an eligible governmental plan under IRC
Section 457(b).
9.02 Eligible Rollovers from the Plan. A Participant or the surviving Spouse of a
Participant (or a Participant's former Spouse who is the Alternate Payee under a Domestic
Relations Order, as defined in IRC Section 4I4(p)) who is entitled to an Eligible Rollover
Distribution may elect, at the time and in the manner prescribed by the Administrator, to have all
or any portion of the distribution paid directly to an Eligible Retirement Plan specified by the
Participant in a direct rollover.
9.03 Plan-to-Plan Transfers - to the Plan.
(a) Permissive Plan-to-Plan Transfers. At the direction of the Employer,
the Administrator may pennit a class of Participants who are Participants in another eligible
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governmentallRC Section 457(b) plan to transfer assets from said eligible governmentallRC
Section 457(b) plan to the Plan as provided herein. Such a transfer is pennitted only ifthe other
Plan provides for the direct transfer of each Participant's interest therein to the Plan. Transfers
from other eligible deferred compensation Plans (as defined in IRC Section 457) to the Plan will
be accepted at the Pat1icipant's request if such transfers are in cash.
(b) Effect of Transfers on Annual Deferral Limitations. Any such
transferred amount shall not be subject to the limitations of Section 5.01 Basic Annual
Limitation, 5.02 Special Section 457 Catch-up Limitation, and 5.03 Age 50 Catch-Up Annual
Deferral Contributions, as an Annual Deferral, provided however, that the actual amount
deferred during the calendar year under both Plans shall be taken into account in calculating the
maximum Annual Deferral for that year. The amount so transferred shall be credited to the
Participant's Account Balance and shall be held, accounted for, administered, and otherwise
treated in the same manner as an Annual Deferral by the Participant under the Plan.
(c) Required Documentation for Transfers to the Plan. The Administrator
may require such documentation from the other Plan as it deems necessary to effectuate the
transfer in accordance with IRC Section 457( e)( 10) and Treasury Regulation Section 1.457-1 O(b)
and to confirm that the other Plan is an eligible governmental plan as defined in Treasury
Regulation 1.457-2(f).
9.04 Plan-to-Plan Transfers - from the Plan.
(a) Outgoing Plan-to-Plan Transfers Pursuant to Severance of
Employment. At the direction of the Employer, the Administrator may permit a class of
Participants and Beneficiaries to elect to have all or any portion of their Account Balance
transferred to another eligible governmental plan with the meaning ofIRC Section 457(b) and
Treas. Reg. 1.457-2(f). A transfer is permitted under this Section 9.04(a) for a Participant only if
the Participant has had a Severance from Employment with the Employer and is a public
employee of the entity that maintains the other eligible governmental 457(b) Plan. Further, a
transfer is permitted under this Section 9.04(a) only if the other eligible governmental 457(b)
plan provides for the acceptance of plan-to-plan transfers with respect to the Participants and
Beneficiaries and for each Participant and Beneficiary to have an amount deferred under the
. other plan immediately after the transfer at least equal to the amount transferred.
(b) Outgoing Plan-to-Plan Transfers While Employed. If the Employer
offers an eligible governmental 457(b) plan other than the Plan, and such other plan accepts
transfers, the Participant may transfer the Account Balance in cash from the Plan to the other
plan.
(c) Limitation of Liability. Upon the transfer of assets under this Section
9.04, the Plan's liability to pay benefits to the Participant or Beneficiary under this Plan shall be
discharged to the extent of the amount so transferred for the Participant or Beneficiary. The
Administrator may require such documentation from the receiving plan as it deems appropriate
or necessary to comply with the is Section 9.04 (for example, to confirm that the receiving plan
is an eligible governmental plan under paragraph (a) of this Section 9.04, and to assure that the
transfer is permitted under the receiving plan) or to effectuate the transfer pursuant to Treas. Reg.
1.457-10 (b).
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ARTICLE X. DOMESTIC RELATIONS ORDERS
10.0 I Receipt of Domestic Relations Orders. When the Employer, Administrator, or
Plan receives a Oomestic Relations Order (ORO), jud!:,'1l1ent, decree, or order (including approval
of a property settlement agreement) pursuant to 26 USC 414(p) that relates to the provision of
child support, alimony payments, or the marital property rights of Spouse or fonner Spouse,
child or other dependent of a Participant is made pursuant to the domestic relations law of any
State, then the amount of the Participant's Account Balance shall be paid in the manner and to
the person or persons so directed in the ORO as the Alternate Payee. Such payments shall be
made without regard to whether the Participant is eligible for a distribution of benefits under the
Plan. The Administrator shall establish reasonable procedures for detennining the status of any
such decree or order and for effectuating distribution pursuant to the ORO. Upon receipt of a
ORO:
(a) The Administrator shall notify the Participant and Alternate Payee of the
receipt of the ORO, and
(b) Within a reasonable time, the Administrator will follow the procedure
adopted by the Employer to detennine the validity of the ORO. In the event the Administrator
believes that the ORO is acceptable, it will process the ORO in accordance with the
Administrator's procedures. If the ORO does not appear to be acceptable, the Administrator may
contact the Employer for a final determination and instruction regarding final disposition of the
ORO.
10.02 Validity of DRO. For purposes of this Article X, a valid ORO is a judgment,
decree, order, or approval of a marital property settlement made pursuant to a state domestic
relations law (including community property law), relating to the property rights of a Participant
and Alternate Payee. In addition, the ORO must:
(a) Create or recognize the existence ofthe right of an Alternate Payee to all
or a portion of benefits payable with respect to a Participant under the Plan;
(b) Clearly specify the following infonnation:
(i) The name and last known mailing address of the Participant and
Alternate Payee covered by the ORO; and
(ii) The amount or percentage, or the manner in which the amount or
percentage is to be detennined, of the Participant's benefits to be paid to the Alternate Payee;
and
the Plan; and,
(iii) The number of payments or period which the ORO applies; and
(iv) The Plan to which such ORO applies.
(c) Provide a fonn of payment to the Alternate Payee that is pennitted under
(d) Not require the payment of benefits to an Alternate Payee which are
required by a prior ORO to be paid to another Alternate Payee.
10,03 Processing of a DRO. If it has been detennined that a ORO applies to a
Participant's account, unless specifically directed otherwise by the Employer, the Administrator
shall comply with the ORO. The Administrator may place a restrictive hold on a Participant's
Account Balance while it detennines the validity of: and/or processes a ORO. The Administrator
II
shall establish a separate Account Balance for the Alternate Payee and transfer the assigned
value or benefit from the Participant's account into the Alternate Payee's separate Account
Balance.
10.04 Rights of an Alternate Payee to Receive Distributions. The Alternate Payee is
entitled to receive distributions immediately upon the establishment of the separate Account
Balance pursuant to Section 10.03 Processing of a DRO. Commencement of distributions must
begin no later than April I st following the year in which the Alternate Payee attains age 70 Y2 .
Distributions made to an Alternate Payee are reported as taxable income to the Alternate Payee
in the calendar year in which the distributions are received by the Alternate Payee. State taxes, if
applicable, and federal taxes will be withheld from any distribution on the Alternate Payee's
Account Balance based upon the tax withholding elections of the Alternate Payee. The Alternate
Payee may not make any contributions to the account but is permitted to designate Beneficiaries
for the Account Balance and to exercise exchanges among the investment options as permitted
by the Plan.
10.05 No Liability for Prior Distributions. In the event that it is determined that a
DRO is valid and the Participant has begun receiving distributions from the Plan, the Alternate
Payee must commence distribution within sixty (60) days following the date the DRO is
determined to be valid. The Administrator shall only process a DRO to the extent possible based
upon the then current value or benefit in the Participant's Account Balance.
ARTICLE XI. AMENDMENT AND TERMINATION
11.01 Employer may, at any time, amend, modify or suspend this Plan, in whole or in
part, at any time, or cease deferring Compensation pursuant to the Plan. Notwithstanding any
other provision of the Plan, Employer in its sole discretion, may terminate this Plan and
discharge in full its obligations under Plan to all Participants or all Participant's beneficiaries by
distributing to such Participants or beneficiaries the value of the Participant's account. No
amendment, modification, suspension, termination or cessation shall affect the rights of
Participants or their beneficiaries to the extent of any amount deferred prior to the amendment,
modification, suspension, termination or cessation.
ARTICLE XII. AMENDMENT AND RESTATEMENT OF PRIOR PLAN
12.01 This Plan amends in its entirety and restates the City of Bremerton's Prior Plan.
This Plan shall apply to all Participants in the Prior Plan on the effective date hereof, and also to
each Employee who elects to participate in this Plan on or after the effective date hereof.
ARTICLE XIII. MISCELLANEOUS
13.01 Choice of Law. This Plan shall be construed under the laws of the State of
Washington.
13.02 Section Headings. The sections headings of this Plan are not a part of this Plan
and shall have no effect upon the construction or interpretation of any part hereof.
12
13.03 Nonassignability. Neither Participant nor his or her beneficiary shall have any
right to sell, assign, transfer or otherwise convey the right to receive any payment hereunder; nor
shall a,ny such payments be subject to attachment, garnishment or execution of any kind in
connection with any claim against Participant or his or her beneficiary.
13.04 Conflict between Plan and Law. In the event of a conf1ict of any provision of
this Plan with applicable provisions of the IRC or Treasury Regulations, the provisions of the
IRC or Treasury Regulations will be controlling.
13.05 Severability. Any provisions of this Plan which shall prove to be invalid, void,
or illegal shall in no way affect, impair, or invalidate any other provision hereof and such other
provision shall remain in full force and effect.
IN WITNESS W~OF, Employer has caused this Plan to he signed and
attested on this / i::t:A J day of .( L4 A ~ I ' 2007.
Attest:
City Cler
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R:\LcgaIlLcgaIlDcpartmcnts-Gcncral\Human Rcsourccs\Dcfcrrcd Compensation\Dclcrrcd Camp Plan - 2007 final.dac
13
AFFIDA VIT OF PUBLICATION
Account # 42742 / Ad # 189175
ST ATE OF WASHINGTON
COUNTY OF KITSAP
I, Sarah Weller, being first duly sworn on oath, deposes and says: That she is now, and at all times
embraced in the publication herein mentioned was the principal clerk of the printers and publishers of
KITSAP SUN; that said newspaper has been approved as a legal newspaper by order of the Superior Court
of the County of Kitsap, in which County it is published and is now and has been for more than six months
prior to the date of the publication hereinafter referred to, published in the English language continually as
a daily newspaper in Bremerton, Kitsap County, Washington, a weekly newspaper in Kitsap County,
Washington and is now and during all of said time, was printed in an office maintained in the aforesaid
place of publication of said newspaper; that the following is a true text of a legal advertisement as it was
published in regular issues (and not in supplement form) of said newspaper on the following dates, to wit: ,
January 22, 2007 and that such newspaper was regularly distributed to its subscribers during all of said
period. That the full amount of the fee charged for the foregoing publication is the sum of $29.15 which
amount has not been paid in full.
~Llja~
(Signature of Principal Clerk)
Sub,c,ib,d ond ,wom to b,fm, m, thi, d,y of Jonu",y ~
Notary Public in and for the State of Washington, Kitsap County.
ORDINANCE NO. 4996
PASSED by the City Council the 17th day of January, 2007.
~
/ .
The full text of this ordinance is available from the City Clerk's Office, 345 Sixth Street, Suite 600,
Bremerton, W A 98337.
January 22, 2007......................AD #20028164