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HomeMy WebLinkAbout06923ORDINANCE NO. 6923 AN ORDINANCE AMENDING CHAPTER 2 OF TITLE II OF THE PUEBLO MUNICIPAL CODE RELATING TO FIREMEN'S PENSIONS AND TO TAX QUALIFICATION THEREOF BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that: (Brackets indicate matter being deleted; underscoring indicates new matter being added) SECTION 1 Paragraph (2) of subsection (m) of section 2 -2 -19 of Chapter 2 of Title II of the Pueblo Municipal Code, as amended, is hereby amended to read as follows: Sec.2 -2 -19. Deferred Retirement Option Program; benefits. (m) (1) (unchanged) (2) Regardless of the form of the payment the participant chooses, the minimum distribution amount will be determined by FPPA and made in accordance with Internal Revenue Code ( "Code ") Section 401(a)(9) and the regulations thereunder, including the minimum distribution incidental death benefit requirement [of income tax regulation Section 1.401(A)(9) -2. The minimum distribution is recalculated by the FPPA annually on the basis of the life expectancy of the participant and the participant's beneficiary, if applicable. If elected in writing before the required beginning date under Code Section 401(A)(9) by the participant, and /or the participant's spouse, if applicable, the expectancy of the participant and /or participant's spouse shall be recalculated annually]. SECTION 2 Section 2 -2 -20 of Chapter 2 of Title II of the Pueblo Municipal Code, as amended, is hereby amended to read as follows: Sec. 2 -2 -20. Additional provisions applicable to plan (tax qualification). (a) The compensation of each member taken into account for determining all contributions under the plan for any year shall not exceed any applicable limit imposed by the Internal Revenue Code ( "Code ") including but not limited to those set forth in Code Section 401(a)(17) to the extent such limits apply to the plan or a particular member. The limits of Code Section 401(a)(17) shall not apply to a member who first became a member in the plan before January 1, 1996, or such later date as permitted by Treasury Regulations. (b) This plan, including the DROP feature, is subject to the limitations on benefits imposed by Code Section 415(b) for government fire pension plans, which are incorporated herein by this reference. Effective January 1, 1995, the mortality table used to determine actuarial equivalence when such determination is required for this plan under Code Section 415(b) shall be the mortality table prescribed by the Secretary of the Treasury based on the Commissioner of the Internal Revenue Service's standard table used to determine reserves for group annuity contracts on the date as of which present value is being determined. The limitation year shall be the plan year. For distributions with annuity starting dates on or after December 31, 2002, the mortality table used for purposes of adjusting any benefit or limitation under Code section 415(b) is the table prescribed in Rev. Rul. 2001 -62. (c) Notwithstanding any provisions of this plan to the contrary, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Internal Revenue Code. (d) For distributions made on or after January 1, 1993, a distributee may elect to have any portion of an eligible rollover distribution paid directly to an eligible retirement plan specified by the distributee in a direct rollover. For purposes of applying this Subsection, the following definitions shall apply: (1) Direct rollover. A direct rollover is a payment by the plan to the eligible retirement plan specified by the distributee. (2) Distributee: A distributee includes a member or former member. In addition, the member's or former member's surviving spouse and the member's or former member's spouse are distributees with regard to the interest of the spouse or former spouse. (3) Eligible retirement plan: An eligible retirement plan is an individual retirement account described in Section 408(a) of the Code, an individual retirement annuity described in Section 408(b) of the Code, an annuity plan described in Section 403(a) of the Code or a qualified trust described in Section 401(a) of the Code that accepts the distributee's eligible rollover distribution. However, in the case of an eligible rollover distribution to the surviving spouse, an eligible retirement plan is an individual retirement account or individual retirement annuity. Effective January 1, 2002, an eligible retirement plan shall also mean an annuity contract described in Code section 403(b) and an eligible plan under Code section 457(b) which is maintained by a state, political subdivision of a state, or agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such elan from this Plan. The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in Code section 414(p). (4) Eligible rollover distribution: An eligible rollover distribution is any distribution of all or any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not include: a. Any distribution that is one (1) of the series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee's designated beneficiary, or for a specified period of ten (10) years or more; b. Any distribution to the extent such distribution is required under Section 401(a)(9) of the Code; and C. The portion of any distribution that is not includable in gross income. For distributions on or after January 1. 2002, a portion of distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after -tax employee contributions which are not includable in gross income. However, such portion may be paid only to an individual retirement account or annuity described in section 408(a) or (b) of the Code, or to a qualified defined contribution plan described in section 401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includable in gross income and the portion of such distribution is not so includable. SECTION 3 This Ordinance shall become effective thirty (30) days after final passage and approval; provided, however, that notwithstanding the foregoing, this Ordinance shall not become effective (a) unless approved by sixty-five percent of the active members of the Pueblo Firemen's Pension Fund and (b) unless the Board of Directors of the Fire and Police Pension Association established pursuant to section 31 -31- 201(1), C.R.S. (Vol. 9, 2002) shall decide to permit said modifications pursuant to Section 31- 30.5- 210(2), C.R.S. (Vol. 9, 2002); and Section 1 of this Ordinance is intended to apply on and after January 1, 2003; the amendment to PMC §2- 2 -20(b) made by this Ordinance is intended to apply to distributions on or after December 31, 2002; and the amendment to PMC §2- 2 -20(d) made by this Ordinance are intended to apply as of January 1, 2002. For such purpose, on its effective date, this Ordinance shall constitute and be construed to be a request by the City to FPPA to so permit the said modifications to the Pueblo Firemen's Pension Fund. INTRODUCED December 9. 2002 BY Al Gurule Councilperson APPROVED: resident of City Council ATTEST: City C PASSED AND APPROVED: December 23, 2002