HomeMy WebLinkAboutORD 3494• • ORIGINAL
ORDINANCE NO. ]~94
ORDINANCE: OF TfiE COUNCIL OF THE CITY OF .PALO AL'I'O
AMENDING THE BUDGET FOR THE FISCAL YEAR 1983-84 TO
ESTABLISH AND PROVIDE FUNDING FOR CAPITAL IMPROVE
MEW£' PRO.."TECT NO. 83-27 •REIMBURSEMENT TO THE CITY
OF PALO AL'.L'O EMPLOYEES DEFERRED COMPENSATION PI.AN
WHEREAS, pursuant to the provisions of Section 12 of Article III
of the Charter of the City of Palo Alto, the Council on June 27, 1983,
did adopt a budget for fiscal year 1983-84~ and
WHEREAS, Council has determined that the interests of the citizens
of Palo Alto will be best served by providing a reimbursement to the
City of Palo Alto Employees Deferred Compensation Plan to replace
unrecoverable assets and earnings~
NOW, THERBFOR8, the Council of the City of Palo Alto does ORDAIN
,;u-> follows~
s ECTIO_N__l.* Capital Improvement Project No. 8 3-.2 7 is he:ceby
established for the ~Reimbursement to the City of Palo Alto Employees
Deferred Compenstion Plan.~
SE:CTION 2. 'l'he sum of Set!f.mty 'l'housand Dollars ($70,000) is
appropriated to Capital Improvement Pt·oject No. 83-27 I!'IR$.:dmbursement to
the City of Palo Alto Employees Deferred Co.mpenstion Plan"' and the
Reserve for' Ca.p!tal Projects is correspondingly decreased.
SECTION 3. The Council finds that this is n()t a project for pur
po;Je:;. of the California E:nv i ronmt. ntal Quality Act and, the:cerore, no
environmental impact assessment is necessary.
SEC1'ION 3. Th:i.s ordinance shall become effective immediately as
provided· ln section 12 of Article III of the Charter and Section
2~04.375 of the Palo Alto Municipal Code.
IN'l'RODUCED AND PASSED: December 12, 1983
AYES: Bechtel, Cobb, Eyerly, K1ein, Levy, Ren.zel ~ Witherspoon
t~OES: None
ABSTENTIONS: None
Fazzino, Fletcher
APPROVED:
APPROVED:
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CITY Or' PALO ALTO
DEFERRED COMPENSATION PLAN
ARTICLE 1
General
Section 1.01 -!!.arne: The name of this plan shall be the City of Palo
Alto Deferr-ed Compenst ion Plan. It may b~., and sometimes hereinafter
is, refen:-ed to as the "Plan" or the ~Deferred Compenstion Plan." The
Plan was adopted on September 27, 1982, and is hereby amended and
restate,,] substrintially to comply with the requirements of Internal
Revenue Code (the "Code~} Section 457, as well as to allow for other
permissible changes, effective December 12, 1983.
Sect ion 1 • 0 2 -l:.::!q;J~SB: The pllrpose of this Plan is to ex tend to
Employees of the Employer certain benefits which ordinarily accrue from
participation in a d~fet:"red compensation plan. The Employer does not
and cannot represent or g~arantee that any particular feder.al or state
income, payroll or other tax consequence will occur by reason of an
Employee's participation in this Plan~ The Employee wishing to
participate in the Plan should consult with his/her own attorney or
other representative regarding all tax or other consequences of
participation in this Plan~
Section 1.03-Definitions:
(a) • Account means the book account to which there are cx:'ed i ted the
amounts deferred by a Participant pursuant to Sec~ion 2.01 hereof,
and any interest, dividends, gains, losses or the like thereon~
{b) •Administrator" means contractor retained by the Employer to
account for deferrals~ the investment and disbursement of funds,
withholding of taxes and to make proper reports to pat~icipants,
annuitants and governmental agencies under the Plan.
(c) "Advisory Committee• shall mean a committee cons,isting of seven
persons elected by the Participants. The primary function of the
Advisory Committee shall be to make :r::·ecommenda.tions regarding
hardship withdrawals and to give advice to the Plan Executive on
such matters pertaining to the Plan including,. but not limited to,
investment and p~yout options, and the charging of administrative
costs at such times as the Plan Executive may request. Members of
the Advisory Committee must be Participa.nts in the Plan.
(d) •Annuity Contract" has the meaning set for-th in Section 4.01(c){2)
heretn.
(e) • Annuity Not ice• nas the meaning set forth in Sect ion 4. 01 (c) ( 1 )
herein.
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(f) "'Beneficiary 1111 means a.ny person designated by the Participant to
receive a pension, annuity, death benefit, or other benefit under
the p~ovisions of this Deferred Compensation Plan.
(g) •senefits• means the benefits payable to a Participant arising out
of such Pat"ticipant' s participation in this Plan, and shall be
determined in the manner set forth in Section 4.01(a)(1) hereof.
(h) Compensation:
(1) •Gross CompensationM for a calendar year means all compensa
tion for-services per formed for th•~ Employer paid tr:) or on
behalf of an Employee during the calenda[ year;
( 2) "Deferrect Compensation" means that port. ion of an Employee's
Gross Compensation which said Employee has el.ected to defer
in accordance with the provisions of this Deferred Compensa
tion Plani'
(3) Hincludible Compensation" means Gross Compensation of an
Bmplcyee less: all amounts with respect to SllCh Employee
defer-red unde-.r: Sect ion 2. C 1 hereof a.nd any other eligible
State deferred compensation plan under Section 457 of the
Code for the calendar yearr all amounts payable to such
Employee for the calendar year by the Employer with respect
to any wage continuation plans, which amounts are excludable
from such Employeets gross inc~ne unde~ Section 105(d) of the
Code; and all amounts payable to such Employee fot: the
calendar year by the Employer as a citizen of the United
States 1 ivinq abroad, which amounts are excludable from such
Employee'n gross income under Section 911 of the Code.
(i) ~Employee means any full-time r~gular employee, part-time regular
employee, or elected official of the Employer.
(j) "Employerq means the City of Palo Alto.
(k) •rnvestment Election" of a Participant as of any date shall mean
those investments included in the Investment Options in which such
Participant has as of such date ~lected to have the assets
credited to his Account invested pursuant to Section 2.03 hereof.
(1) •Investment Options~ as of any date shall mean those alternative
investments designated by the Employer in which the assets
credited to a Part ici.pant • s Account may be invested pursuant to
Section 2.03~
(m) Normal Retirement Age• of a Participant means any age of a Partie-
ipant in the following range: beginn~ng with the .first
age fifty (50) in w-hich such Participant has five ( 5)
PERS-creoited service with the Employer, and ending
latest retirement age of such Participant under PERS~
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a.ge over
y~ars of
with the
(n} wParticipant~ means any Employee who voluntarily elects to partic
ipate in this Plan by filing a duly executed Participation Autho
r~zation with the Employer.
(o) wparticipation Authorization~ means the Employee's election to
parti.cipate and authorization to defer compensation pursuant to
the provisions of this Plan, as set forth on the form provided by
the City pursuant to Section 3.04 herein.
( p) ~ PERS" means the Public Employees 1 Retirement System as set forth
in Sections 20000 et. ~~· of the California Government Code as
adopted by the City pursuant to a contract dated March 9, 1942, as
amended from time to time.
(q) "Plan Executive"' means the-City Manager or the duly authorized
designee of the City Manager. The discretion or other functions
given to the Employee under the terms of the Plan shall be exer-
cised by the Plan Executive as the Employer 1 s authorized agent.
(r) ~Plan Yearft means calendar year.
(s) "Separation from Service of the Employerw means termination of a
Participant's emp.loyment re:ul t ing from resignation r d ischar.ge,
ret i "Cement from service of the F;mployer upon the Participant's
attaining Normal Retirement Age, disability resulting in termina
tion of emplo:zo-rnent or death of the Participant.
(t) •sevet·e Financial Hardship" shall have the meaning set forth in
Section 4~02 hereof~
(u) ~Terminating Participant~ means any Participant who separates from
ser\' ice ~i th the Employet' ~~1d accepts employm~nt with a new
employer ..
ARTICLE 2
O~ration of Plan
Section 2.01 -Participation: An:y· Emplc.>yee may elect to become a
Participant of the Plan and to defer payment of part of his/her Gross
Compensat.ion by exe-cuting a written Participation Authorization and
f 11 ing it in the manner set forth in Article 3 hereof. The dollar
amount deferred must be at least $10., 00 per pay period or such larger
amount as may be designated by the Plan Executive from time to time.
The maximum that may be deferred under the Plan for the Participant's
taxable year by ~ Participant shall not exceed the lesser of (a)
$7~500, or (b) 33-1/3 percent of the Participant's Includible Compensa
tion (twenty-five percent (25%) of a Participant•s Gross Compensation);
provided, however, that during one or more of a Participant's last
three taxable years @nding befo~~ such Participant attains Normal
Retirement Age 1 the maximum amount that may be deferred under the Plan
shall he the lesser of (a) $15,000 or (b) the maximum aggregat~ amounts
which such Participant is eligible to defer (i.e~ 25% of Gross Campen-
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sation or 33% Includible Compensation) for each calendar year commenc
ing on or after January 1, 1979, less the ag9regate of amounts actually
deferred under this Plan for such yeal"s. The amount a Participant
elects to defer may be changed in accordance with Section 3.04 herein.
section 2.02 -Deferral of Co~Ul?-ansation. Employer and Participant
mutually acknowledge that the compenst1on of each Employee as set forth
in the annual salary regulations or resolutions of the Employer in
clude/3 the dollar amount of funds deferred under the terms of this
Plan. Employee compensation shall be paid bi-weekly or as otherwise
provided, except that during each year in ;.;hi ch the Employee is a
Participi~nt in the Plan, that portion of his/her said compensation
which is specified by the Employee in the Participation Authorization
shall be deferred and paid in accorda:)ce with the pt·o!,li s ions of: ti1 is
Plan.
Section ~.03 -In~estm~t of Amounts Credited to Participants AQcounts.
(a) From time to time, the City shaLl design~te alt-ern..;.ti.ve invest~·
ments {the l'f Investment Opt ions~) in which amounts credited to a
Participant's Accou~t may be invested under the Plan. The Admin
istrator shall notify each Participant in writing of the Invest
ment Options available as of the date of such notice.
(b) The amounts credited to a Participant's Account shall be invested
in such Investment Option or Options and in such portions ~s th~
Participant shall elect {the ~Investment Election~) subject to the
provisions of this subsection (b). A. Participant 1 s Investment
Election, and any change in SIJCh Investment. Election, shall be
made in writing on such forms and at such times and in accordance
with such procedu~es as the Plan Executive may prescribe~ provided
that such for~s and procedures shall be con~unicated to all
Participants and shall be uniformly applied to all Participants in
a non-discriminatory =anner.
(C) In the abstence of a Participant's Investment
credited to such Participant~ s Account may b€
manner as the Administrator may determine.
Election,
invested
amounts
in such
Section 2.04 -EmRlOl!!}' Ree£.2nsib}l i ty: The de_signation of any In'-'•est
ment Opti.on by the Employer shall not be cons1dered to be an endorse
ment or gmu:antee of such Investment Option.. Further, neither the
Employer, the Plan Executive, nor the Advisory Committee shall be helfr
responsible for any invePtment results, e i tber gai.ns or losses, frota
any Investment Options in which a Participant elects to have the
amounts credited to his/her Account invested.
Section 2~05 -Administration of the Plan: The Plan shall be directed
by the Plan Executive who shali ha\iii-fhe sole auth~.,rity for the opera
tion of the Plan in accordance with its ter.ms and shall rule on all
questions arisinq out of the af~inistr.ation, interpretation and appli
cation of the Plan, which determination shall be conclusive and binding
on all Participants.
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Section 2~06 -Ownershie of Defen:ed Amo~: .All amounts deferred by
Participants under the Plan {the "Deferred Amounts"), all investments
made with the Deferred Amounts pursuant to the Plan, and all interest
dividends, 9ains or other income with respect thereto remair. {until
paid or made available to a Part.icipant or Beneficiary) solely the
property of the Employer subject only to the claims of general
creditors of the Employer, and neither the existence of the Plan nor of
any investments made pursuant the~eto shall be deemed to create a trust
or limit use by the Employer of the funds therein for general Employer
purposes. The obligations of the Employer to make payments pursuant to
this Plan is contractual only, and no Participant or Beneficiary shall
have a pre.ferred claim or lien on or to the Deferred Amounts or any
investment earnings thereon but shall have only the right to receive
the Benefits payable under the Plan. Any contracts and other evidence
of the investment of all assets under this Plan shall be registered in
the name of the Employer which shall be the owner-beneficiary thereof.
ARTICJ .. E 3
Administrati9n and Accounting
Section 3 ... 0 1 ~ Administration: The Plan Executive shall direct the
Plan and will prescr 1be ·such forms, and adopt such rules ·'lnd regula
tions as necessary to carry out the purposes of the Plan. Al :;o, t.he
Plan Executive may employ investment counsel to provide advice concern
ing categories of investment, Investment Opt. ions r gu idel incs and .in
vestment policy~ provided, howeverv that the advice or recommendations
of any such investment counsel shall not be binding on the Plan Execu
tive, who shall nu~ke the final determination concerning In,·estment
Options.
Se. tion 3 .. 02 -Election to Participate~ An Employee's election to
participate in -this Deferred Compensation Plan shall be made by filing
a duly executed Participation Authorization with the Administrator, and
not otherwise.
Section 3.03 -Enrollment Periods.:
(a) Any person who becomes an Employee may effect an initial election
to participate under this Plan during the next enrollment period
following employment.. Parti.cipation in the Plan becomes effective
in the ~irst month after the enrollment period during which his/
her P.9-::ticipation Authorization is filed with the Administrator,
(b) En~>llment in the Plan will be held at least four times per year
(th•~ "Enrollment Periods"" J. Such election will be effective for
pa}' pe·riods in the first month after the enrollinent period during
which an Employee's Participation Authorization is filed with the
Administrator ..
S~ction 3.04 -Particip~L~t~ Authorization: The Admini.strator shall e~tabl ish a fonn-oT Part c1pation Authorization and other enrollment
forms which ehall contain, among ather provisions, the following:
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(a) A provision whereby the Participant specifies the port~on of his/
her Gross Compensation which is to be deferred.
(b) A provision whereby the Participant indicates his/her Investment
Elections.
(c) A provision whereby the ParticiJ:)ant designates a Beneficiary or
Beneficiaries, including one or more contingent Beneficiaries to
receive any Benefits which may be payable under this Plan on death
of the Participant4
(d) An acknowledgement by the Participant that his/her sala~y, wage,
or other compensation is as set forth in any salary ordinance or
otherwise, without deductions for amounts deferred under the
provisions of this Plan.
(e) A provision whereby the Participant, his/her heirs, successors and
assigns hold harmless the Employer, the Plan Executive and the
Advisory Committee from any liability hereunder for all acts per
formed in good faith, including the acts relating to the invest
ment of any of the Defet·x:-ed Amounts and/or the Parti-cipant's
Investment Elections hereunder.
Section 3.05 -Amernent of ParticiEation Authorization~ The Participant
may revoke his Partlclpation Authortzatlon at any t1me by filing with
the Administrator a written revocation. He/she may change t.he amount
of compensation to be deferred by signing and filing with the Adminis
trator a written amendment, on a form approved by the Administrator.,
.Any such ame.ndment shall be effective prospectively only, beg inning
with the first Enrollment .Per ioo commencing at the time of or after the
amendment. A Participant may change his/her Investment Election in
accordance with the then current guidelines and procedure established
by the Administrator and communicated to all Participants.
Section 3.06 -~articipant's Accgunts:
(a) Establishment and. Mftintenance: A separate Account shall be main
ta:Tricd'"" for each Partlcipant7 The Employer shall cause to have
c1:edited to each such Account amqunts equal to the compensation
deferred by the Participant under the Plan as well as that por
tion, if any, of. monies being transferred from an eligible
deferred compensation plan of a prior employer. All interest,
dividends, charges for premiums, capi.tal Qr market chan9es with
re~pect to a Participant•s Inv~stment Slections shall be credited
or debited to the Participant's Account as they occur. For con
venience, and to facilitate an orderly administration of the·Plan,
individual Accounts for all Participants will be maintained by the
Administrator showing the Participant • s name with all applicable
debj.t a!"'it credit balances. A written report of the status of the
Ac~vw .. ~ ~t ee=h Participant shall be furnished to such Participant
at such regular intervals as the Plan Executive shall determine.
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(b) Transfers To and.Xrom a Participant¥~ Account:
( 1) In the event a Participant (the ~'~"'J:~erminating Participant" j
separates from s~rv ice and accepts employment with a new
employer, upon written request to the Administrator by such
Participant, with the consent of the Plan Executiv~ which may
be granted or denied in the absolute discretion of the Plan
Executive, and subject to the conditions set forth below, the
Employer shall cause to be transferred to the ownership and
control of the new employer's eligible deferred compenstion
plan an amount equal to the amount credited to such Partici
pant's Account as of the last day of the quarter which coin
cides with or n~~xt precedes the date of transfer. Not.••ti t.h·~
standing any Jther provision of this Plan, payment of
Benefits to such a Terminating Participant will not commence,
and all amounts credited to his accot.mt shall be automat
ically transferred.
(2} Transfers under Section 3 .. 06(b}(1} will be subject tC-l the
following conditions:
A. The Employer has no def.ne~ current or future need fo~
the funds, assets, <~nd accumulations iu the said Partie~
ipant ~ s Accou.nt for the payment of its general creditors
or for any other purpose;
B. The new employer is a State within the meaning of
Treasury Regulation Section 1~457-2{c), the new employer
and the Employer are located in the same State, the new
emplQyer' s deferred compens.ation plan is an 79 Eligible
State Deferred Compensation Plann within the meaning of
Treasury Regulation Section 1.457-2 and provides for the
acceptance of transferred accounts of transferring
employees, the new employer will accept the funds, and
the requirements of Treasury Regulation Section
1 .457-2( k) with respect to plan-to-plan transfers are
satisfied;
c. The new "!mployer shall have agreed in writing with the
Employee to assume the continuing contractual liability
to pay the Deferred Compensation so transferred accord
ing to the provisions of the new employer's plan;
o~ The Employee shall have agreed, in writing, to release
the F.;mployer from any and all contractual obligations
undQr the provisions of this Plan, upon completion of
such transfer to the new eru.ployer.;
(3) Notwithstanding any provisions of Section 3.06(b), a Termina
ting Participant may elect to leave the funds, assets, and
accumulations in his/her Account until such time as he/she
would otherwise receive his/her Benefits irs accordance with
h • 1:1/h~t' stated preference as provided in Article 4 of this
Plan;
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(4) Notwithst.andin9 any other provision of this Plan, with the
consent of the Plan Executive, which consent may be granted
ox:· denied in the sole and absolute discretion of the Plan
Executive or the Administrator shall be authorized t.o accept
all (and only. all) of the amounts held (whether by a trustee 1
custodian or ot.herw.ise) on behalf of any other plan, which
satisfied the applicable requirements of Section 457 of the
Code and Treasury Regulation Section 1.457~2 and which is
maintained for the benefit of· any persons who are or are
about to become Participants of this Plan. Upon the transfer
of any assets of a participant pursuant to the preceding
sentence, the Administrator shall credit the Account of such
Participant with the amounts so transferred as of the date of
transfer. Thereafter, any such transferred funds sh.all be
treated as any other assets in a Participant's Account.
Section 3.07 -Administrative Coats: The Plan Executive may determine,
in a manner deemed~fait.·--a:n-dequitable, the administrative costs associ,··
a ted wi t.h the wi. thhold ing of Deferred Compensation pursuant to this
Plan or in making investments or otherwise administering or implement
ing the Plan. The Plan Executive may withhold or collect, or. have
withheld or collected, such costs 1 in such manner as he deems equitable
from the Def~rr·ed Compensation pursuant to t.he Plan~ or the income
produced from any investment, and acco~dingly adjust the Participants•
Accounts.
ARTICLE 4
Benefits
Section 4.01 -Benefi.t~ Genera!!l.: The Participant is entitled to have
paid to him/her the benefits created by his/her participating in this
Deferred Compensation Plan, in accordance with the provisions of this
Article. Amounts paid to a Participant pursuant to this Article shall
be reported to a Participant as wages subject to withholding for
federal and state income taxes and reportaple on form w-2. All actions
and determination of the Employer under this Article 4 shall be on a
uniform and non-discriminatory basis.
(a) ~a rat ion from Service; .
(1) In the event of a Participant's separr.tion from service with
the Employer. resulting from resignation, discharge, retire
ment from service with the Employer · upon attaining Normal
Retirement A.ge, disability resulting· in termination of
employment or death of the Participant, the amount credited
to the Partici.pant• s Account shall be determined as to the
last day of val~ing Participants• Accounts {whether such
valuation is done quarterly or daily) next preceding distri
bution and distributed to the Participant or: his/her Bene
ficiary in accordance with the provisions of Section 4~02(c)
below.
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(2} If a Participant becomes disabled as defined by the disabil
ity income provisions in the Employer's t·etirement program
applicable to the Participant 1 and if as a result of such
disability, the Participant separates from service and
commences receiving Benefits, the Administrator shall provide
to such disabled Parti~ipant a written statement setting
forth the date of such disabled Participant's separation from
service and the fact that such disabled Participant separated
from service and began receiving Bene~its because of a perma
nent disability which required such disabled Participant 1 s
separation from servic~.
(b) _s~~ Financial Har~s.hi.E.,~ In th~.; event of severe financial hard
ship resul tin.g ·f. rom an unforeseen emergency, Benef i t.s shall be
payable in accordance with Secti0n 4~02 hereofo
(c} Payment OI?tic,ns A~~E~le t:o Par~ici.p.~altE..~
(i) Subject to Section 4.02(c}{2} below, upon a Participant•s
separation from service, the Benefits shall be payable to the
Participant in a single sum payment on the date ninety (90)
days after the date of such separation (but in no event later
than sixty ( 60) days after the close of the Plan Year in
which separation from sE:rvice occurred}, unless before the
date thirty (30) days after the separation, the Participant
irrevocably elects in writing to the Administrator (the
~Annuity Notice~) to have his/her Benefits paid in the form
of one of the following payment options:
A. Life annuity;
·B. Life annuity with a period certain guaranteed1
c. Unit refund life annuity: or
o. Joint and survivor annuity.
E. Any such other payout options deemed appropriate by the
Plan Executive from time to time.
{2) The options provided in Section 4.02(c)(1) above shall be
actuarily equivalent to the Benefits to which the Participant
would otherwise be entitled under this Section 4. 01. s~ch
annuities shall be provided under an annuity contract (the
"Annuity Contract") qualified for sale in California, with
such insurance company or other third party as the Adminis
trator shall dete~mine, subject to the Participant's consent$
Subject to the requirements set forth in the preceding sen
tence, an Annuity Contract may be altered, amended, changed
or substituted for, from time to time by action of the Admin
istrator, and such altered, amended, changed, or substituted
contract or contracts the~eafter may be used in the Plan~
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(3) Any Annuity Contract made available to a Participant pursuant
to Section 4.01(c)(1) above, shall provide that:
A~ In any Annuity Contract which provides for payments
beyond a Participant's life, amounts payable to the
Participant under such Annuity Contract (as determined
by the mortality tables of the entity providing the
annuity) must exceed 50% of the maximum that could have
been payabl~ to the Participant: if no provision were
made for payment to a Beneficiary; and
B. Any Benefits payable to a Beneficiary must be paid
ov(':r:
( i ) The life of the Beneficiary
period), if the Beneficiary is
surviving spouse, or
(or any shorter
the Participant 1 s
(ii) A period not in excess ot fifte€·n (15) years~ if
the Beneficiary is not the Participantes surviving
spouse.
C a Payments under such Annuity Contract shall commence no
later than the later of:
(i) 60 days after the close of the Plan Year in which
such Part i.e ipant attains (or would have attained)
Normal Retirement Age, or
(ii) 60 days after the close of the Plan Year of separa
tion from service by such Participant.
Distributions to Beneficiaries: --
( 1) The Participant has the right to name and file wi_th the
Employe.r, a written beneficiary foz;-m designating the person
or persons (the waeneficiary") who shall receive any r~main
ing Benefits in the event of the Participant's deatiL The
form for this purpose shall be provided by the Employer. It
is not binding on the .Employer IJntil it is signed, filed with
the Employer ·by the ilarticipant, and accepted by the Em
ployer. Ally Beneficiary designation may be changed b-y the
filing of a subsequent beneficiary designation formo If the
Participant dies without havin9 a Beneficiary form. on file,
the Benefi.te shall be made to the properly appointed fidu
ciary or the Participant,' s probate estate. However!' if a
fiduciary has not been appoint~d an<! qualified within one
hundred twenty ( 120) days after the Participant's death, the /
benefits shall be paid first to a surviving spouse, next to a/
surviving ahild or children, and thereafter to the surviving
parent or parents of the Participant. The Participant ac
cepts and acknowledges that he/she has the burden for execut~
ina and filing with the Employer a proper Beneficiary desig
nation form.
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( 2) In the event of the death of a Participant prior to the.
corrunencernent of distribution of Benefits, the naml;'d Benefic
iary shall have the right to designate that payments to such
.Beneficiary shall be in accordance with one of the payment
options available to Participants under Section 4~0l(c)
above. Such election by a Beneficiary shall be made in
accordance with the requirements for election of payment
options by a Participant under Section 4~01(c) above.
{3~ If the Participant dies after the commencement of payment of
Benefits to him pursuant to one of t,he payment opt ions set
forth in Sections 4.01(1)(c)A. through 4.01(c)(l)D. above 1 and before such Participant~s entitlement to payment of
Benefits has been exhausted, then the remaining Benefits pay
able shall be paid to the Participant's designated Bf.me
ficiary in accordance with the payment option selected by the
Participant.
Setion 4v02-Pa¥mer~~-Sev~re Financial H~rdsh~~: Notwithstanding
any other provision hereln, in the event of a severe financial hard
ship, a Participant may apply to the Plan Executive to withdraw Bene
fits, in 'Nhole or in pat:t, from the Plan pt·ior to separao.tion from
service. Withdrawal of Benefits shall be limited str:ictly to that
amount reasonably necessary to meet an unforeseen emergency situation
which causes the severe financial hardship. Any remaining Benefits
shall be paid upon such Participant's separation from service in
accordance with S~ct ion 4 ~ 01 , above. Withdrawal of any Benefits for
severe financial hardship shall be limited to that which results from
~eal and unforeseen emer9encies beyond the control of the Participant
which would cause severe financial hardship if early wi thclrawal of
Benefits were not permitted. Examples of severe financial hardship to
the Participant include that which results from a sudden and unexpected
illness or accident of the Participant or of a dependent of the Partic
ipant or loss of the Participant's property due to casualty or other
similar ~xtraordinary and unforeseeable circumstances arising as a
result of events beyond the control of the Participant. In any event,
no payments for severe financial hardship shall be made to the e.xtent
such hardship is or may be relieved through reimbursement or compensa
tion by :lnsurance or otherwise, by 1 iquidation :>f the Participant• s
assets to the extent that liquidation of such asset~ would not itself
cause severe financial hardship, or by cessation of deferrals under the
Plan. Examples of what are not considered to be tJnforeseeable emer
gencies include the need to send a Participant's child to college or
the desire to purchase a home or automobile. The decision of the Plan
Executive concerning aevr=re financial hardship shall be made after
review and recommendation are made by the Advisory Committee and shall
be final as to all Participants~
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ARTICLE 5
Miscellaneous
Section 5.01 ... Leave of Absence: If a Participant is on an approved
leave of abs~nce from the Employer with compensation, participation in
this Plan will continue. If a Participant is on an approved leave of
absence without compensation and such leave of absence continues for
more than six (6) months, said Participant will be deemed to have te~m
inated participation in the Plan as of the end of such six (6) month
period. Such tet'mination of participation will not cause distribution
of Benefits. Upon return from such leave of absence, the Participant's
full compensation on a non-deferred basis will be thereupon restored.
Such Employee may again become a Participant by meeting the require~
ments for eligibility, as herein provided.
Section 5~02 -.Retirement Sys~em Intesratior: Benefits payable by and
deduction for Employee contribl!tion to, any retirement system of the
Employer shall be computed without reference to amounts deferred pur
suant to this Deferred Compensation Plan and !lhall instead be based
upon Gross Compenstion the Participant would receive if he/she had not
elected to participate in this Plan and to defer compensation.
Section 5.03 -Amendment: This Plan may be modified, amended or termi
nated in whole or 1n part ( inclwj ing retroactive amendments) by the
Bmployer at any time. No amendment or-termination of the Plan shall
reduce or impair the rights of any Participant or Beneficiary which
have already accrued. Upon termination of the Plan, the Employer shall
distribute all amounts credited to each Account in accordance with the
Participant's payment opt ion selected pursuant to Article 4. All
Participants shall be treated in the same manner.
Section 5~04-Cr.editors: A Participant may not assign, transfer~
sell, hypothecate, or otherwise dispose of any or all of his/her
Account. or any right which he/she may have under the Plan, and any
attempt to do so shall be void.
Section 5.05-Ernploy.ment: Participation in the Plan shall
construed as giving any Particip<:nt any right to continue
employment with th~ Employer.
not b~
his/her
Section 5.06 -Succ~~ssor;s and Assigr!!_~ The Plan shall be binding qpon
and shall inur-e ·to the benefit of the Employer:, its successCi::s c.:nd
assigns, all Participants and Beneficiaries and their beirs and legal
representatives.
Section 5.07 -Written Notice: Any notice or other communication
req,Jired or perm1tted under the Plan shall be in writing, and if
directed to the Employer or the Administrator shall be sent to the
designat~~ office of the Employer, and, if directed to a Participant or
to a Bt; .. ~~ :_:~.cy, sh?ll be sent to such Participant or Beneficiary at
either his/het" last known address as it appears on the Employer's
record or to the work site, at the Employer's option.
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.. . • •
Section 5.08 -Pacilit~ of Payment: If any Participant terminates
employment with--~n unpaid debt owing to the Employer, and neglects or
ref uses to 1 iquidate the debt by any other means when due and upon
demand, the Employer shall be entitled to collect the amounts due from
the Benefits owed to the Participant under the Plan.
Section 5. 09 -Total Agreement; 'llh is Plan and the Participation
Authorizationp a:nd any subsequently adopted amendment thereof, s'h~ll
constitute the total agreement or contract between the gmployer and th•
Participant regarding the Plan~ No oral statement regarding the Plan
may be relied upon by the Par.ticipant.
Section 5.10 -Gender: As used herein, the masculine sh~ll include the
neuter and the feminine where appropriate.
Sect ion 5. 1 1 ·-C:ont rolling Law t This .?.1 an is ere a ted and shall be
i.nter:pret~d under the law$ of the State of California as the same shall
be at the time any dispute or issue is raised.
IN WITNESS WHEREOF, the Employer has executed this amended and restated
Plan this 12th day of December, 1983.
Sy __ ~-----------------------
Title: ---------~-----
A'I'TES'l';
City Clerk
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