HomeMy WebLinkAboutRES 89-107RESOLUTION 89- 107
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF DIAMOND BAR ESTABLISHING A DEFERRED
COMPENSATION PLAN FOR THE EMPLOYEES OF THE
CITY.
WHEREAS, the Employer has employees rendering valuable
services; and
WHEREAS, the establishment of a deferred compensation
plan for such employees serves the interests of the Employer by
enabling it to provide reasonable retirement security for its
employees, by providing increased flexibility in its personnel
management system, and by assisting in the attraction and retention
of competent personnel; and
WHEREAS, the Employer has determined that the
establishment of a deferred compensation plan to be administered
by the ICMA Retirement Corporation serves the above objectives; and
WHEREAS, the Employer desires that the investment of
funds held under its deferred compensation plan be administered by
ICMA Retirement Corporation, and that such funds be held by the
ICMA Retirement Trust, a trust established by public employers for
the collective investment of funds held under their deferred
compensation plans and money purchase retirement plans;
NOW THEREFORE BE IT RESOLVED that the Employer, unless
it has already done so, hereby adopts the deferred compensation
plan attached hereto as:
(1) Appendix A
and appoints the ICMA Retirement Corporation to serve as
Administrator thereunder; and
BE IT FURTHER RESOLVED that the Employer hereby executes
the Declaration of Trust of the ICMA Retirement Trust, attached
hereto as Appendix B.
BE IT FURTHER RESOLVED that the City Manager shall be the
coordinator for this program and shall receive necessary reports,
notices, etc. from the ICMA Retirement Corporation or the ICMA
Retirement Trust, and shall cast, on behalf of the Employer, any
required votes under the program. Administrative duties to carry
out the plan may be assigned to the appropriate departments.
1989.
PASSED, APPROVED AND ADOPTED this 7th day of November
I, Lynda Burgess, City Clerk of the City of Diamond Bar, do
hereby certify that the foregoing Resolution was passed at a
regular meeting of the City Council of the City of Diamond Bar held
on the 7th day of Wnvamher 1989, by the following
vote:
AYES:
COUNCIL
MEMBERS:
Forbing, Miller, Werner,
Mayor Pro Tem Horcher and Mayor Papen
NOES:
COUNCIL
NEMBERS:
None
ABSENT:
COUNCIL
MEMBERS:
None
ABSTAINED:
COUNCIL
MEMBERS:
None
ATTEST:-
TTEST:City
CityC-Ifdrk
of the Cit of Di tbad Bar
OA 5'tIt
("EMPLOYER")
DEFERRED COMPENSATION PLAN
AFTICLE 1. INTRODUCTION
The Employer hereby establishes the Employers Deferred Compensation Plan,
hereinafter referred to as the "Plan." The Plan consists of the provisions set forth
in this document.
The primary purpose of this Plan is to provide retirement income and other
deferred benefits to the Employees of the Employer in accordance with the pro-
visions of section 457 d the Internal Revenue Code of 1954. as amended.
This Plan shall be an agreement sdely between the Employer and participat-
ing Employees.
ARTICLE 11. DEFINITIONS
Section 2.01 Account: The bookkeeping account maintained for each Par-
ticipant reflecting the cumulative amount of the Participant's Deferred Com-
pensation, 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 Participants Beneficiary and any tees or expenses charged against such
Participants Deferred Compensation.
Section 2.02 Administrator: The person or persons named to carry out cer-
tain nondiscretionary administrative functions under the Plan, as hereinafter
described. The Employer may remove any person as Administrator upon 60
days' advance notice in writing to such person, in which case the Employer
shall name another person or persons to act as Administrator. The Adminis-
trator may resign upon 60 days' advance notice in writing to the Employer,
in which case the Employer shall name another person or persons to act as
Administrator.
Section 2.03 Beneficiary: The person or persons designated by the Par-
ticipart in his Joinder Agreement who shall receive any benefits payable here-
under in the event of the Participant's death.
Section 2.04 Deferred Compensation: The amount of Normal Compensa-
tion otherwise payable to the Participant which the Participant and the Employer
mutually agree to defer hereunder, any, amount credited to a Participant's
Account by reason of a transfer under Section &03, or any other amount which
the Employer agrees to credit to a Participant's Account.
Section 2.05 Employee: Any individual who provides services for the
Employer, whetfter as an employee of the Employer or as an independent con-
tractor, and who has been designated by the Employer as efigible to partici-
pate in the Plan.
S*cbw 2.06 Ineludible Compensation: The amoint d an Employees com-
pensation from the Employer for a taxable year that is attributable to services
_performed for the Employe+ and that is inoludide in the Employees gross income
or 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 Internal Revenue Code, any amount exGud-
able from gross income under section 403(b) of the Internal Revenue Code,
or any other amount excludable from gross income for federal income tax pur-
poses. Includible Compensation shall be determined without regard to any
community property laws.
Section 2.07 Joinder Agroement: An agreement entered into between an
Employee and the Employer, including any amendments or modifications
themed. Such agreement anal) fix the amount of Deferred Compensation. spec ty
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
Section 2.08 Normal Compensation: The amount of compensation which
would be payable to a Participant by the Employer for a taxable year it no
Joinder Agreement were in effect to defer compensation under this Plan.
Section 2.09 Normal Retirement Age: Age M. unless the Participant has
elected an alternate Normal Retirement Age by written instrument delivered
to the Administrator prior to Separation from Service. A Participant's Normal
Retirement Age determines (a) the latest time when benefits may commence
under this Plan (unless the Participant continues employment after Normal
Retirement Age), and (b) the period during which a Participant may utilize the
catch-up limitation of Section 5.02 hereunder. Once a Participant has to any
extent utilized the catch-up limitation d Section 602, his Normal Retirement
Age may not be changed.
A Participant's alternate Normal Retirement Age may not be earlier than the
earliest date that the Panicipant will become eligible to retire and receive
unreduced retirement benefits under the Employers basic retirement plan cover-
ing the Participant and may not be later than the date the Participant attains
age M. It a Participant continues employment after attaining age 70, not hav-
ing previously elected an alternate Normal Retirement Age, the Participant's
alternate Normal Retirement Age shall not be later than the mandatory retire-
ment age, it any, established by the Employer. or the age at which the Par-
ticipant actually separates from service it the Employer has no mandatory retire-
ment age lt the Participant will not become eligible to receive benefits under
a basic retirement plan maintained by the Employer, the Participant's alternate
Normal Retirement Age may not be earlier than attainment of age 55 and may
not be later than the attainment of age M.
Section 2.10 Participant: Any Employee who has joined the Plan pursuant
to the requirements of Article IV.
Section 2.11 Plan Year: The calendar year.
Section 2.12 Retirement: The first date upon which both of the following
shell have occurred with respect to a Participant: Separation from Service and
attainment of age 65.
Section 2.13 Separation from Servlcs: Severance of the Participant's
employment with the Employer which constitutes a 'separation from service"
within the meaning of section 402 (e) 4 (A) (ii) of the Internal Revenue Code.
In general, a Participant shall be deemed to have severed his employment
with the Employer for purposes of this Pian when. in accordance with the estaD
fished practices of the Employer, the employrnent relationship is considered
to have actually terminated. In the case of a Participant who is an indepen-
dent contractor d the Employer, Separation from Service shall be deemed
to hava occurred when the Partidparil's contract under which services are per•
formed has completely expired and terminated, there is no foreseeable pos-
sibility that the Employer will renew the contract or enter into a new contract
for the Participant's services, and it is not anticipated that the Participant will
become an Employee of the Employer.
t ARTICLE Ili. ADMINISTRATION creditors d the Employer and no Participant or Beriefiaary' shall have any vested
interest or secured or preferred position with respect to such property or have
Section 3.01 Duties of 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.
;ection 3.02 Duties of Administrator. The Administrator, as agent for the
Employer, shall perform nondlecretionary administrative torictions in connec-
tion with the Plan, including the maintenance of Participants' Accour><s, the
provision of periodic reports on the status of each Account and the disburse-
ment
isbursement of benefits on behalf of the Employer in accordance with the provisions
of this Plan.
ARTICLE IV. PARTICIPATION IN THE PLAN
Section 4.01 Initial Participation: An Employee may become a Participant
by entering into a Joinder Agreement prior to the beginning of the calendar
month in which the Joinder Agreement is to become effective to defer com-
pensation not yet earned.
Section 4.02 Amendment of Joinder Agreement: A Participant may
amend an executed Joinder Agreement to change the amount of compensa-
tion not yet earned which is to be deferred (including the reduction of such
future deferrals to Hero) or to change his investment preference (subject to such
restrictions as may result from the nature or lama of any investment made
by the Employer). Such amendment shall become effective as of the begin-
ning of the calendar month commencing after the date the amendment is
executed. A Participant may at any time emend his Joinder Agreement to
change the designated Beneficiary, and such amendment shall become effec-
tive immediately.
ARTICLE V. LIMITATIONS OF DEFERRALS
Section 5.01 Normal Limitation: Except as provided in Section 5.02, the
maximum amount of Deferred Compensation for ary Participant for any taxa-
ble year stall not exceed the lesser of 575100.00 or 331A percent of the Par-
^ topants Inducciible Compensation for the taxable year. This limitation will ordinar-
ily be equivalent to the lesser of $7,500.00 or 25 percent of the Participant's
Normal Compensation.
Section 5.02 Catch -Up Limitation: For each of the last three (3) taxable
years of a Participant ending before his attainment of Normal Retirement Age,
the maximum amount of Deferred Compensation shall be the lesser of:
(1) 515,000 or (2) the sum of (i) the Normal Limitation for the taxable year, and
(i) that portion of the Normal Limitation for each of the prior taxable years of
the Participant commencing after 1978 during which the Flan was in existence,
compensation (if any) deterred under the plan was subject to the limitations
set forth in section 501, and the Participant was eligible to participate in the
Plan (or in any other plan established under section 457 of the Internal Reve
nue Code by an employer within the same State as the Employer) in excess
of the amount of Deferred Compensation for each such prior taxable year
[including amounts deferred under such other plan). For purposes of this Section
5.02. a Participant's Includible Compensation for the current taxable year shall
be deemed to include any Deferred Compensation for the taxable year in excess
of the amount permitted under the Normal Limitation, and the Participant's
Includible Compensation for any prior taxable year snail be deemed to exclude
any amount that could have been deferred under the Normal Limitation for
such prior taxable year.
Section 5.03 Section 403(b) Annuities: For purposes d Sections 501 and
5.02, amounts contributed by the Employer on behalf of a Participant for the
purchase of an annuity contract described in section 403(b) of the Internal
Revenue Code shall be treated as if such amounts constituted Deferred Com-
pensation under this Plan for the taxable year in which the contribution was
maoe and shall thereby reduce the maximum amount that may be deferred
for such taxable year.
1CLE VI. INVESTMENTS AND ACCOUNT VALUES
action 5.01 Investment of Deferred Compensation: All investments Of
Participants' Deterred Compensation made by the Employer, including all prop-
erty
roperty and rights purchased with sueti amounts and all income attributable thereto
shall be the sole property of the Employer and shall not be held in trust for
Participants or as collateral security for the fulfillment of the Employer's obliga-
tions under the Plan. Such property shall be subject to the claims of general
N
any claim against the Employer except as a general creditor.
Section 6.02 Crediting of Accounts: The Panioipants Account "1 reflect
the amount and value d the investments or other property obtained by the
Employer through the investment Of the Partwipants Deferred Compensation.
It is anticipated that the Employers investments with respect to a Participant
will conform to the investment preference specified in the Participant's Joinder
Agreement, but nothing herein shall be construed to require the Employer to
make any particular irtvestrnent of a Partiapant's Deferred Compensation. Each
Partiapant shall receive periodic reports, not les_ frequently tan annually, show-
ing the then -current value of his Account
Section 6.03 Transfers: A transfer will be accepted from an eligible State
deferred compensation plan maintained by another employer and credited
to a Participant's Account under this Plan. The Employer may require such
documentation from the predecessor plan as it deems necessary to effectu-
ate the transfer, to confirm that such plan is an eligible State deterred com-
pensation plan within the meaning of section 457 of the Internal Revenue Core,
and to assure that transfers are provided for under such plan. Any such trans-
ferred amount shall not be treated as a deferral subject to the limitations of
Article V, except that, for purposes of applying the limitations of Section 5.01
and 5.02, an amount deterred during any taxable year under the plan from
which the transfer is accepted shatI be treated as if it had. been deterred under
this Plan during such taxable year and compensation paid by the transteror
employer shall be treated as it d had been paid by the Employer.
Section 6.04 Employer Liability: In no event shall the Employer's liability
to pay benefits to a Participant under Article VI exceed the value d the amounts
credited to the Participants Account, the Employer shall not be liable for losses
arising from depreciation or shrinkage in the value ol ary investments acquired
under this Plan.
ARTICLE VII. BENEFITS
Section 7.01 Retirement Benefits and Election on Separation from
Service: Except as otherwise provided in this Article VII, the distribution of
a Participant's Account shall commence during the second calendar month
after the close of the Plan Year of the Participant's Retirement, and the distri-
bution of such Retirement benefits shall be made in accordance with one of
the payment options described in Section 7.02. Notwithstanding the forego-
ing, the Participant may irrevocably elect within 60 days following separation
from Service to have the distribution of benefits commence on a date other
than that described in the preceding sentence which is at least 60 days after
the date such election is delivered in writing to the Employer and forwarded
to the Administrator but not later than 60 days after the dose of the Plan Year
of the Participant's attainment of Normal Retirement Age or Separation from
Service, whichever is later.
Section 7.02 payment Options: As provided in Sections 7.01 and 7.05. a
Participant may elect to have the value of his Account distributed in accor-
dance with one of the fri laving payment options, provided that such option
is consistent with the limitations set forth in Section 7.03:
(a) Equal monthly, quarterly, semi-annual or annual payments in an amount
chosen by the Participant, continuing until his Account is exhausted;
(b) One lump sum payment;
(c) Approximately equal monthly, quarterly, semi-annual or annual payments.
calculated to continue for a period chosen by the Participant;
(d) Payments equal to payments made by the issuer of a retirement annuity
policy acquired by the Employer;
(e) Ary other payment option elected by the Participant and agreed to by
the Employee
A Participant's election of a payment option must be made at least 30 days
before the payment of benefits is to commence If a Participant fails to make
a timely election of a payment option, benefits shall be paid monthly under
option (c) above for a period of five years.
Section 7.03 Limitation on Options: No payment option may be selected
by the Participant under Section 7.02 unless the present value of the payments
to the Participant, determined as of the date benefits commence. exceeds 50
percent of the value of the Participant's Account as of the date benefits
commence. Present value determinations under this Section shall be made
by the Administrator in accordance with the expected return multiples set forth
in section 1.72-9 of the Federal Income Tax Regulations (or any successor Pro-
vision to such regulations).
Section 7.04 Post-retirement Death Bernettta: Should the Par=partt die
after he has begun to receive benefits under a payment option, the remaining
paymert[s, if any, under the payment option shall be payable to the Partici-
pant's Beneficiary commencing within the 34day period commencing with
the 31st day after the Participant's death, unless the Beneficiary elects pay-
ment under a different payment option within 30 days of the Participant's death.
In no event shall the Employer or Administrator be liable to the Beneficiary
for the amount of any payment made in the name of the Participant before
the Administrator receives proof of death of the Participant. Notwithstanding
the foregoing, payments to a Beneficiary shall not extend over a period longer
than (i) the Beneficiary's life expectancy if the Beneficiary is the Panicipant's
spouse or (ii) fifteen (15) years if the Beneficiary is not the Participant's spouse.
It no Beneficiary is designated in the Joinder Agreement, or it the designated
Beneficiary does not survive the Participant for a period of fiheen (15) days,
them the commuted value of any remaining payments under the payment option
shall be paid in a lump sum to the estate of the Participant. If the designated
Beneficiary survives the Participant for a period o1 fifteen .(15) days, but does
not continue to live for the remaining period of payments under the payment
option (as modified, if necessary, in conformity with the third sentence of this
section), then the commuted value of any remaining payments under the pay-
ment option shall be paid in a lump sum to the estate of the Beneficiary.
Section 7.05 Pre -retirement Death Benefits: Should the Participant die
before he has begun to receive the benefits provided by Section 7.01, the value
of the Participant's Account shall be payable to the Beneficiary commencing
within the 30 -day period commencing on the gist day after the Participant's
death, unless the Beneficiary elects a different benefit commencement date
within the 90 days of the Participant's death. Such benefits shall be paid in
approximately equal annual installments over five years. or over such shorter
period as may be necessary to assure that the amount of any annual install-
ment is not less than $3.500. unless the Beneficiary elects a different payment
option within 90 days of the Participant's death. Notwithstanding the lorego-
ing, bereft paid to a Beneficiary under this Section may commence no earlier
than the gist day atter the Participant's death and no later than 60 days after
the later of the close of the Plan Year in which the Participant attained or would
have attained Normal Retirement Age or the close of the Plan Year in which
the Participant separated from service. A Beneficiary who may elect a pay-
ment option pursuant to the provisions of the preceding sentence shall be
treated as if he were a Participant for purposes of determining the payment
options available under Section 7.02: provided. however, that the paymern option
chosen by the Beneficiary must provide for payments to the Beneficiary over
a period no longer than the life expectancy of the Beneficiary it the Benefici.
ary is the Participants spouse and must provide for payments over a period
not in excess of fifteen (15) years it the Beneficiary is not the Participant's spouse
Section 7.06 Unforeseeable Emergencies: In the event an untoreseeable
emergency occurs, a Participant may apply to the Employer to receive that
part of the valued his account that is reasonably needed to satisfy the emer-
gency need. If such an application is approved by the Employer, the Participant
shall be paid only such amount as the Employer deems necessary to meet
the emergency need, but payment shall not be made to the extent inat the
financial hardship may be relieved through cessation of deferral under the Plan.
insurance or other reimbursement. or liourdation of other assets to the extent
such liquidation would not itsefi cause severe financial hardship. An urtfore5ee
able emergency shall be deemed to involve only circumstances of severe
financial hardship to the Participant resulting from a sudden and unexpected
illness, accident or disability of the Participant or of a dependent (as defined in
section 152(a) of the Internal Revenue Code) of the Participant. loss of the Par-
ticipant's property due to casualty, Or other similar and extraordinary unforesee-
able circumstances arising as a result of events beyond the control of the Par-
ticipant. The need to semi a Participant's child to college or to purchase a new
home shall not be considered unforeseeable emergencies. The determrnatron
as to whether such an unforeseeable emergency exists shall be based on the
mems of each individual case.
ARTICLE VIII. NON,ASSIGNABIUTY
No Participant or Beneficiary shall have any right to commute, sell, assign,
pledge, transfer or otherwise convey or encumber the right to receive any pay-
ments hereunder, which payments an: rights are expressly declared to be non -
assignable and non-transterable.
ARTICLE IX. RELATIONSHIP TO OTHER PLANS AND EMPLOYMENT
AGREEMENTS
This Plan serves in addition to any other retirement, pension, or benefit plan
or system presently in existence or hereinafter established for the benefit of the
Employer's employees, and participation hereunder shat' not affect benehts receiv-
able under any such plan or system. Nothing contained in this Plan shall be
deemed to constitute an employment contract or agreement between any Par-
ticipant and the Employer or to give any Participant the right to be retained in
the employ of the Employer. Nor shall arything herein be construed to modify
the terms of any employment contract or agreement between a Participant and
the Employer.
ARTICLE X. AMENDMENT OR TERMINATION OF PLAN
The Employer may at any time amend this Plan provided that it transmits such
amendment in writing to the Administrator at least 30 days prior to the effective
date of the amendment. The consent of the Administrator shall not be required
in order for sucn amendment to become effective, but the Administrator shall
be under no obligation to continue acting as Administrator hereunder if it disap-
proves of such amendment. The Employer may at any time terminate this Plan.
The Administrator may at ary time propose an amendment to the Plan by an
instrument in writing transmitted to the Employer at least 30 days before the effec-
tive date of the amendment. Such amendment shall become elective unless,
within such 30-0ay period, the Employer notifies the Administrator in writing that
A disapproves such amendment, in which case such amendment shall not become
effective. In the event of such disapproval, the Administrator shall be under no
obligation to continue acting as Administrator hereunder.
No amendment or termination of the Plan shall divest any Participant of any
rights with respect to compensation deterred before the dale of the amendment
or termination.
ARTICLE XI. APPLICABLE LAW
This Plan shall be construed under the laws of the state where the Employer
is located and is established with the intent that it meet the requirements of an
eligible State deferred compensation plan' under section 457 of the Internal Rev.
enue Code of 1954, as amended. The provisions of this Plan small be interpreted
wherever possible in conformity with the requirements of tnat section.
ARTICLE X11. GENDER AND NUMBER
The masculine pronoun, whenever used herein, shall include the feminine pro-
noun, and the singular shall induce the plural, except where the context requires
otherwise.
DECLARATION OF TRUST
OF
ICMA RETIREMENT TRUST
ARTICLE I. NAME AND DEFINITIONS
Section 1.1 Name: The Name d the Trust. as amended and restated hereby,
is the ICMA Retirement Trust.
Sedlon 1.2 Deflnitlons: *,twever, they are used herein. the following terms
shall have the following respective mearings:
(a) Sy -Laws The By.Laws referred to in Section 4.1 hared. as amended from
time to time.
(b) Doffed Comperrsapon Plan. A deferred compensation plan established
and maintained by a Pudic Employer for the purpose of providing retire-
ment income and other deferred benefits to As employees in accordance
with the provisions of section 457 of the Internal Revenue Code of 1954,
as amended.
(c) Employees
Those employees who participate in Qualified Plans.
(d) Employer Trust. A trust created pursuant to an agreement between RC
and a Public Employer for the purpose of investing and administering the
funds set aside by such Employer in connection with its Deferred Compen-
astion agresmherts with id employees or in owwoe ion wth lfa ouakw Plan.
(e) Guaranteed Investment Contract. A contract entered into by the Retire-
ment host with insurance companies that provides for a guaranteed rate
of return on investments made pursuant to such contract.
M ICMA. The International City Management Association.
(g) ICMAIRC Trustees. Those Tnrstees elected by the Public Employers who,
in accordance with the provisions d Section 3.1(a) hereof, are also mem-
bers of the Board of Directors of ICMA or RC.
(h) Investment Adviser The Investment Adviser that enters into a contract
with the Retirement Trust to provide advice with respect to investment Of
this Trust Property.
O PbMdios. The Portfolios of investments established by the Investment
Adviser 1D the Retirement hast, under the supervision of the Trustees. for
the purpose of providing irmestments for the Trust Property
O Pudic Employee Trustees Those hum elected by Cts Pudic Employers
who, in accordance with the provisions of Section 3.1(a) hereof, are full-time
employees of Pudic Employers
(p Pudic Employer hustees. Public Employers who serve as trustees of
the QulaKed PhM
(Q Public Employee A unit of spate or total government, or any agency or
instrumentality thered, that has adopted a Deilemed Compensation Plan or
a Qualified Plan and has executed this Declaration of Trust.
(m) Qualified Plan. A plan sponsored by a Public Employer for the purpose
of providng retirement income to its employees which setisfies the qualifi-
cation requirements of Section 401 of the Internal Revenue Code, as
amended.
(n) RC The InWrsational City Management Association Retirement Corpo-
ration.
APPENDIX B
(o) Retirement TAM. The Trust created by this Declaration of Trust.
(p) Trust Property. The amounts hold in the Retirement Trust on befall Of the Public
Employers in connection with Delerred Compensation Plans and on behatl d the
Public Employer Trustees for the exclusive benefit of Employees pursuant to Quali-
fied Plans. The Trust Property shall include any income resulting from the invest -
mart of the amounts so held.
(W Trustees The Public Employee Trustees and ICMA/RC Trustees elected by the
Pudic Employers to serve as members of the Board of Trustees of the Retirement
Trust.
ARTICLE II. CREATION AND PURPOSE OF THE TRUST; OWNERSHIP
OF TRUST PROPERTY
Section 2.1 Creation: The Retirement Trust is created and established by
the execution of this Declaration of Trust by the Trustees and the Pudic
Employers.
Section 2.2 Purpose: The purpose of the Retirement Trust is to provide for
the commingled investment of funds held by the Public Employers in connec-
tion with their Deferred Compensation and Qualified Plans. The Trust Prop-
"
roparty shall be invested in the Portfolios. in Guaranteed Investment Contracts.
and in other investments recommended by the Investment Adviser under the
supervision of the Board of ThOees NO pan Of the Trust Property will be invested
in secunda; issued by Public Employers.
Section 2.3 Ownership of Trust Property: The Trustees shall have "at
title to the Trust Property. The Public Employers shall be the beneficial owners
of the portion of the Trust Property allocable to the Deferred Compensation
Plans. The portion of the Trust Property allocable to the Qualified Plans shall
be hold for the Public Employer Trustees for the exclusive benefit of the
Employees
ARTICLE 111. TRUSTEES
Section 3.1 Number and Qusllflcation of Trustees.
(a) The Board of Trustees shall co 169 of rine Trustees. Five of the Trustees
OW be full-time employees of a Public Employer (the Pudic Employee
Trustees) who are authorized by such Public Employer to serve as Trustee
The remaining four Trustees shelf dist of two persons who. at the time of
election to the Board of Trustees, are members of the Board of Directors of
ICMA and two Persons who, at the time Of election, are members of the Board
of Directors of RC phis OAAAC Trtnlees) One Of the Trustees who is a dvrecor
of ICMA. and one of the Trustees who is a director of RC. "I. at the time
of election, be full-time employees Of a Pudic Employer.
(b) No parson may serve as a Trustee for more than one term in any ten-year
period,
Section 3.2 El CUW and Tian.
(a) Except for the Trustees appointed to fill vacanciesrsu
puant to Section 35
hared. the Trustees shall be elected by a voted a majority of the Pudic
Employers in accordance with the procedures set forth in the Bylaws.
1io:tion 4.2 Distribution of lh»t Property: Distributions of the pkat Prop -
arty shall be made to or on behalf d, the Pudic Employer or Public Employer
'Euatea, in acoadanee with the tarns of the Deferred Compensation Piers,
OuWwd Piano or Employer Trisha The Trustees of ft Retirement Trust *a
be fully proracted in making payments in accordance with tine diremors of
to Public Employers, Pudic tcmplvysr V aless or other Tnudee of ft Ernployer
lusts without ascertaining whether such payments are in compliance with the
praisiors of the Deferred Compensebon or Ouafied Plans, or the agreements
creating the Employer 7ruste.
Section 4.3 Esecutbn of Instruments: The Trustees may unanimously
desgnale any one or more d the Trustees to execute any instrument or door
meat on behalf of all, including but not limited to the signing or endorsement
Of any rXtsek and the signing of any applications, insurance and other con-
, and the action of such designated Trustee of Trustees shall have the
same force and afeot as if taken by all the Trwtees.
ARTICLE V. DUTY OF CARE AND LIABILITY OF TRUSTEES
Section 5.1 Duty of ata: In exercising the powers hereinbefore granted to
the Trustees, the Trustees shall perform all acts within their authority for the
exclusive purpose of providing benefits for the Pudic Employers in cones•
tion with Deferred Canpersation Plans and Public Employer Trustees pursuant
1D Qualified Plans, and shall perform such acts with the care, skill, prudence
and diligence in the circumstances then prevailing that a prudent person act-
ing in alike capacity and familiar with such matters would use in the conduct
of an enterprise of alike character and with like aims.
Section 5.2 Llablllty: The Trustees shall not be liable for any mistake of **
merit or other action taken in good faith. and ler any action taken or omitted
in reliance in good tach upon the books of account or other records of the
Retirement Trust, upon the opinion of counsel, or upon reports made to the
Retirement Trust by any of ifs officers, employees or agents or by the Invest,
ment Adviser or any sub -investment adviser, accountants, appraisers or other
experts or consultants selected with reasonable rare by the Trustem officers
or employees of the Retirement Trust. The Trustees shall also not be liable for
many loss sustained by the Trust Property by mason of any investment made
in good faith and in accordance with the standard of care set forth in Section 51.
uetion 5.3 Bond: No Trustee shall be obligated to give any bond or other
security for the performance of any of his or her duties hereunder.
ARTICLE VI. ANNUAL REPORT TO SHAREHOLDERS
The Trustees shall annually submit to the Pudic Employers and Public Employer
Tusises a wriCen report of the transactions of to Retirement Trust, including firms
pal staterr»nts.which ship be certified by independent pudic accauntertm shoo
sen by the luslaes-
ARTICLE VII. DURATION OR AMENDMENT OF RETIREMENT TRUST
Section 7.1 Withdrawal: A Public Employer or Public Employer Trustee may,
al any time. withdraw from tits Ra mmert hull by delivering to the Board of
Vustees a written statement of withdrawal. to such statemett, *a Public
Employer or Public Employer Tu tee shat acknowledge that the Trust Pmp-
erty allocable to the Pudic Employer is derived from compensation deferred
by employees of such Pubic Employer pursuant to its Deferred Compensw
tion Plan or horn contributions to the aceourts of Empktyees pursuant to a
Ousliped Plan. and shall designate the financial instifubm to whish such property
sial be transferred by the Trustees of the Retirement Trust or by the Trustee
of the Employer Trust.
Section 7.2 Duration: The Retirement Trust shall continue until terminated
by the vote d a majority of the Pudic Employers, each casting one vote. Upon
larmination, all of the That Property shat be paid out to the Pudic Employers.
Public Employer Trustees or the Trustees of the Employer Trusts, as appropriate
Section 7.3 Amendment: The Retirement That may be amended by the vote
d a majority of the Public Employers, each casting one vote
Section 7.4 Procedure: A resolution to terminate or amend the Retirement
Trust or to remote a Trustee shall be submitted to a vote of the Public Employers
if: (1) a majority of the Trustees so direct, or: () a petition requesting a vote,
signed by not kiss than 25% of the Pudic Employers, is submitted to the
Trustees.
ARTICLE VUI. MISCELLANEOUS
Section 8.1 Governing Law: Except as otherwise required by state or kcal
law, this Declaration of Trust and the Retirement Trust hereby created shalt be
construed and regulated by the laws of the District of Columbia.
Section 8.2 Counterparts: This Declaration may be executed by the Pudic
Employers and Trustees in two or more counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument.
`( S'P-e- C�I WE -N
TRUST AGREEMENT WITH
THE ICMA RETIREMENT CORPORATION
AGREEMENT made by and between the Employer named in the attached reso-
lution and the International City Management Association Retirement Corpora-
tion (hereinafter the 'Trustee" or "Retirement Corporation', a nonprofit corpora-
tion organized and existing under the laws of the State of Delaware for the purpose
of investing and otherwise administering the funds set aside by Employers in
connection with deferred compensation plans established under section 457 of
the Internal Revenue Code of 1954 (the "Code 1. This Agreement shall take effect
upon acceptance by the Trustee of its appointment by the Employer to serve
as Trustee in accordance herewith as set forth in the attached resolution.
WHEREAS, the Employer has established a deferred compensation plan under
section 457 of the Code (the "Plan);
WHEREAS, in order that there will be sufficient funds available to discharge
the Employer's contractual obligations under the Plan, the Employer desires to
set aside periodically amounts equal to the amount of compensation deferred;
WHEREAS, the funds set aside, together with any and all assets derived from
the investment thereof, are to be exclusively within the dominion, control, and
ownership of the Employer, and subject to the Employer's absolute right of with-
dmwel, no employees having arty interest whatsoever therein;
NOW, THEREFORE, this Agreement witnesseth that (a) the Employer will pay
monies to the Trustee to be placed in deferred compensation accounts for the
Employer, (b) the Trustee covenants that it will hold said sums, and any other
funds which it may receive hereunder, in trust for the uses and purposes and
upon the terms and conditions hereinafter stated; and (c) the parties hereto agree
as follows:
ARTICLE I. GENERAL DUTIES OF THE PARTIES
Sectlon 1.1 General Duty of the Employer: The Employer shall make regu-
lar periodic payments equal to the amounts of its employees' compensation
which are deferred in accordance with the terms and conditions of the Plan
to the extent that such amounts are to be invested under the Trust.
Section 1,2 Gerwal Duties of the Truslse: The Trustee shall hold all funds
received by t hereunder, which, together with the income therefrom, shall con-
stitute the Trust Funds. It shall administer the Trust Funds, collect the income
thereof, and make payments therefrom, all as hereinafter provided. The Trus-
tee shall also hold all Trust Funds which are tranderred to d as sumer Trustee
by the Employer from existing deferred compensation arrangements with its
Employees under plants described in section 457 of the Coda Such Trust Funds
shall be subject to all of the terms and provisions of this Agreement.
ARTICLE II. POWERS AND DUTIES OF THE TRUSTEE IN INVESTMENT,
ADMINISTRATION, AND DISBURSEMENT OF THE TRUST
FUNDS.
Seetlon 2.1 Investment Power and Duties of the Trustee: The Trus-
tee shall have the power to invest and reinvest the principal and income of
the Trust Funds and keep the Trust Funds invested, without distinction between
principal and income, in securities or in other property, real or personal, wher-
ever Mu ted. including, but not limited to stocks, common or preferred, bonds,
APPENDIX C
retirement annuity and insurance policies, mortgages, and other evidences of
indebtedness or ownership, investment companies, common or group trust funds,
or separate and different types of funds (including equity, fixed income) which
fulfill requirements of state and local governmental laws, provided, however. that
the Employer may direct investment by the Trustee among available investment
alternatives in such proportions as the Employer authorizes in connection with
its deferred compensation agreements with its employees. For these purposes.
these Trust Funds may be commingled with Trust Funds set aside by other
Employers pursuant to the terms of the ICMA Retirement Trust. Investment powers
vested in the Trustee by the Section may be delegated by the Trustee to any bank,
insurance or trust company, or any investment adviser. manager or agent selected
by it.
Section 2.2 Administrative Powers of the Trustee: The Trustee shall have
the power in its discretion:
(a) To purchase, or subscribe for, any securities or other property and to
retain the same in trust.
(b) To sell, exchange, convey, transfer or otherwise dispose of any securi-
ties or other property held by it, by private contract, or at public auction.
No person dealing with the Trustee shall be bound to we the application
of the purchase money or to inquire into the validity, expediency, or propri-
ety of any such sale or other disposition.
(c) To vote upon any stocks, bonds, or other securities; to give general or
special proxies or 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 oppose, or to consent to,
or otherwise participate in, corporate reorganizations or other changes affect-
ing corporate securities, and to delegate discretionary powers, and to pay
any assessments or charges in connection therewith; and generally to exer-
cise any of the powers of an owner with respect to stocks, bonds, securities
or other property held as part of the Trust Funds.
(d) To cause any securities or other property held as part of the Trust Funds
to be registered in its own name, and to hold any investments in bearer form,
but the books and records of the Trustee shall at all times show that all such
investments are a part of the Trust Funds.
(e) To borrow or raise money for the purpose of the Trust in such amount.
and upon such terms and conditions, as the Trustee shall deem advisable;
and, for any sum so borrowed, to issue Its promissory note as Trustee. and
to secure the repayment thereof by pledging all, or any part, of the Trust
Funds. No person lending money to the Trustee shall be bound to see the
application of the money lent or to inquire into its validity, expediency or
propriety of any such borrowing.
(f) To keep such portion of the Trust Funds in cash or cash balances as
the Trustee, from time to time, may deem to be in the best interest of the
Trust created hereby, without liability for interest thereon.
(g) To accept and retain for such time as t may deem advisable any securi-
ties or other property received or acquired by it as Trustee hereunder whether
or not such securities or other property would normally be purchased as
investment hereunder.
(h) To make. execute, acknowledge, and deliver any and ail documents of
transfer and conveyance and any and all other instruments that may be
necessary or appropriate to carry out the powers herein granted.
(i) To settle, compromise. or submit to arbitration any claims. debts. or
damages due or owing to or from the Trust Funds; to commence or defend
suits or legal or administrative proceedings; and to represent the Trust Funds
in all suits and legal and administrative proceedings.
0) To do all such acts. take all such proceedings, and exercise all such rights
and privileges. although not specifically mentioned herein, as the Trustee
may deem necessary to administer the Trust Funds and to carry out the
purposes of this Trust.
Section 2.3 Distributions from the Trust Funds: The Employer hereby
appoints the Trustee as its agent for the purpose of making distributions from
the Trust Funds. In this regard the terms and conditions set forth in the Plan
are to guide and control the Trustees power.
Section 2.4 Valuation of Trust Funds: At least once a year as of Valuation
Dates designated by the Trustee. the Trustee shall determine the value of the
Trust Funds. Assets of the Trust Funds shall be valued at their market values
at the close of business on the Valuation Date, or, in the absence of readily
ascertainable market values as the Trustee shall determine, in accordance with
methods consistently followed and uniformly applied.
ARTICLE Illi. FOR PROTECTION OF TRUSTEE
Section 3.1 Evidence of Action by Employer: The Trustee may rely upon
any certificate, notice or direction purporting to have been signed on behalf
of the Employer which the Trustee believes to have been signed by a duly
designated official of the Employer. No communication shall be binding upon
any of the Trust Funds or Trustee until they are received by the Trustee.
Section 3.2 Advice of Counsel: The Trustee may consult with any legal coun-
sel with respect to the construction of this Agreement, its duties hereunder,
or any act, which it proposes to take or omit, and shall not be liable for any
action taken or omitted in good faith pursuant to such advice.
Section 3.3 Mlecelleneous. The Trustee shall use ordinary care and reasona-
ble diligence. but shall not be liable for arty mistake of judgment or other action
taken in good faith. The Trustee shall not be liable for any loss sustained by
the Trust Funds by reasons of any investment made in good faith and in accor-
dance with the provisions of the Agreement.
The Trustees duties and obligations shall be limited to those expressly
imposed upon it by this Agreement.
ARTICLE IV. TAXES, EXPENSES AND COMPENSATION OF TRUSTEE
Section 4.1 Ill=$: The Trustee shall deduct from and charge against the Trust
Funds arty taxes on the Trust Funds or the income thereof or which the Trus-
tee is required to pay with respect to the interest of any person therein.
Section 4.2 Expenses: The Trustee shall deduct from and charge against
the Trust Funds all reasonable expenses incurred by the Trustee in the adminis-
tration of the Trust Funds, including counsel, agency, investment advisory, and
other necessary fees.
ARTICLE V. SETTLEMENT OF ACCOUNTS
The Trustee shall keep accurate and detailed accounts of all investments,
receipts, disbursements, and other transactions hereunder.
Within ninety (90) days after the close of each fiscal year, the Trustee shall ren-
der in duplicate to the Employer an account of its acts and transactions as Trus-
tee hereunder. If any part of the Trust Fund shall be invested through the medium
of any common, collective or commingled Trust Funds, the last annual report
of such Trust Funds shall be submitted with and incorporated in the account.
If within ninety (90) days after the mailing of the account or any amended account
the Employer has not filed with the Trustee notice of any objection to any act
or transaction of the Trustee, the account or amended account shall become
an account stated. If any objection has been filed, and if the Employer is satis-
fied that it should be withdrawn or if the account is adjusted to the Employer's
satisfaction, the Employer shall in writing filed with the Trustee signify approval
of the account and it shall become an account stated.
When an account becomes an account stated. such account snail ce
settled. and the Trustee shall be comp ete!y d scrarged and released. as i sic^
account had been settled and allowed by a judgment or decree of a court of
competent jurisdiction in an action or proceeding in which the Trustee and ;he
Employer were parties.
The Trustee shall have the right to apply at any time to a court of competent
jurisdiction for the judicial settlement of its account.
ARTICLE VI. RESIGNATION AND REMOVAL OF TRUSTEE
Section 6.1 Resignation of Trustee: The Trustee may resign at any time
by filing with the Employer its written resignation. Such resignation shall take
effect sixty (60) days from the date of such filing and upon appointment of
a successor pursuant to Section 6.3., whichever shall first occur.
Section 6.2 Removal of Trustee: The Employer may remove the Trustee
at any time by delivering to the Trustee a written notice of its removal and an
appointment of a successor pursuant to Section 6.3. Such removal shall not
take effect prior to sixty (60) days from such delivery unless the Trustee agrees
to an earlier effective date.
Section 6.3 Appointment of Successor Trustee: The appointment of a
successor to the Trustee shall take effect upon the delivery to the Trustee of
(a) an instrument in writing executed by the Employer appointing such suc-
cessor, and exonerating such successor from liability for the acts and omis-
sions of its predecessor, and (b) an acceptance in writing. executed by such
successor.
All of the provisions set forth herein with respect to the Trustee shall relate
to each successor with the same force and effect as if such successor had
been originally named as Trustee hereunder.
If a successor is not appointed within sixty (60) days after the Trustee gives
notice of its resignation pursuant to Section 6.1., the Trustee may apply to any
court of competent jurisdiction for appointment of a successor.
Section 6.4 Transfer of Funds to Successor: Upon the resignation or
removal of the Trustee and appointment of a successor, and after the final
account of the Trustee has been properly settled. the Trustee shall transfer and
deliver any of the Trust Funds involved to such successor.
ARTICLE VII. DURATION AND REVOCATION OF TRUST AGREEMENT
Section 7.1 Duration and Revocation: This Trust shall continue for such
time as may be necessary to accomplish the purpose for which it was created
but may be terminated or revoked at any time by the Employer as it relates
to any andlor all related participating Employees. Written notice of such termi-
nation or revocation shall be given to the Trustee by the Employer. Upon ter-
mination or revocation of the Trust, all of the assets thereof shall return to and
revert to the Employer. Termination of this Trust shall not, however, relieve the
Employer of the Employer's continuing obligation to pay deferred compensa-
tion to Employees in accordance with the terms of the Plan.
Section 7.2 Amendment: The Employer shall have the right to amend this
Agreement in whole and in part but only with the Trustees written consent.
Any such amendment shall become effective upon (a) delivery to the Trustee
of a written instrument of amendment, and (b) the endorsement by the Trus-
tee on such instrument of its consent thereto.
ARTICLE VIII. MISCELLANEOUS
Section 8.1 Laws of the District of Columbia to Govern: This Agree-
ment and the Trust hereby created shall be construed and regulated by the
laws of the District of Columbia.
Section 6.2 Successor Employers: The "Employer" shall include any per-
son who succeeds the Employer and who thereby becomes subject to the
obligations of the Employer under the Plan.
Section 8.3 Withdrawals: The Employer may, at any time. and from time to
time, withdraw a portion or all of Trust Funds created by this Agreement.
Section 8.4 Gender and Number. The masculine includes the feminine and
the singular includes the plural unless the context requires another meaning.