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HomeMy WebLinkAboutResolution No. 12-C39RESOLUTION NO. 12-C39 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA AUTHORIZING PUBLIC AGENCY RETIREMENT SERVICES (PARS) SUPPLEMENTAL RETIREMENT PLAN (SRP) TO IMPLEMENT AN EARLY RETIREMENT INCENTIVE PROGRAM FOR QUALIFYING MEMBERS OF THE AZUSA CITY EMPLOYEES ASSOCIATION WHEREAS the City of Azusa (the "City") is a member of the Public Agency Retirement System (PARS) for the purpose of providing tax qualified retirement benefits; and WHEREAS it is to be determined to be in the best fiscal interest of the City and its employees to provide a supplementary retirement program to eligible employees who wish to voluntarily exercise their option to separate from City service; and WHEREAS the PARS Trust has made available a Supplementary Retirement Plan (SRP), supplementing CalPERS and qualifying under the relevant sections of the Internal Revenue Code and the California Government Code. NOW THEREFORE, be it resolved that: 1. The City Council, being a member of the PARS Trust, does hereby adopt the PARS Supplementary Retirement Plan, effective June 18, 2012; and 2. In order for the City to reach stated fiscal and operational objectives, a minimum savings must be achieved. If this minimum is not reached, the City may withdraw the retirement incentive. If the City withdraws the retirement incentive, resignations may be rescinded; and 3. The City Council hereby appoints the City Manager, or his/her successor or his/her designee as the City's Plan Administrator for the PARS Supplementary Retirement Plan; and The City's Plan Administrator is hereby authorized to execute the PARS legal and administrative documents on behalf of the City and to take whatever additional actions are necessary to maintain the City's participation in PARS and to maintain PARS compliance of any relevant regulation issued or as may be issued; therefore authorizing him/her to take whatever additional actions are required to administer the City's PARS plan(s). In addition, if the City's Plan Administrator finds that the PARS supplemental plan benefit must be limited under Section 415 of Internal Revenue Code, then the Plan Administrator will implement replacement benefit programs at no additional cost to the City. The City Clerk shall certify the passage of this Resolution. APPROVED AND PASSED this 18`h day of June, 2012. �R OF THE CITY OF AZUSA I HEREBY CERTIFY that the foregoing Resolution wajduly passed by the City Council of the City of Azusa at a regular meeting thereof held on the 18` day of June, 2012. AYES: COUNCILMEMBERS: GONZALES, CARRILLO, MACIAS, HANKS, ROCHA NOES: COUNCILMEMBERS: NONE ABSENT: COUNCILMEMBERS: NONE CITY CLERK OF AGREEMENT FOR ADMINISTRATIVE SERVICES This agreement (".Agreement") is made this day of X012. between Phase II Systems, a corporation organized and existing under the laws of the State of California. doing business as Public Agency Retirement Services (hereinafter "PARS") and the City of Azusa ("Agency"). WHEREAS, Agency is desirous of retaining PARS. as Trust Administrator to the PARS Trust, to provide administrative and consulting services with respect to the City of Azusa PARS Supplementary Retirement Plan or any excess benefit plan (the "Plan"). NOW THEREFORE, the parties agree: I. Services. PARS will provide the services pertaining to the Plan as described in the exhibit attached hereto as "Exhibit 1 A" ("Services") in a timely manner, subject to the further provisions of this .Agreement. 2. Fees for Services. PARS will be compensated for performance of the Services as described in the exhibit attached hereto as "Exhibit 1B". 3. Payment Terms. Payment for the Services will be remitted directly from Plan assets unless otherwise stated in Exhibit I B. In the event that the Agency chooses to make payment directly to PARS, it shall be the responsibility of the ,Agency to remit payment directly to PARS based upon an invoice prepared by PARS and delivered to the Agency. if payment is not received by PARS within thirty (30) days of the invoice delivery date, the balance due shall bear interest at the rate of 1.5% per month. If payment is not received from the .Agency within sixty (60) days of the invoice delivery date, payment plus accrued interest will be remitted directly from Plan assets, unless PARS has previously received written communication disputing the subject invoice that is signed by a duly authorized representative of the Agency. 4. Fees for Services Beyond Scope. Fees for services beyond those specified in this .Agreement will be billed to the Agency at the rates indicated in the PARS standard fee schedule in effect at the time the services are provided and shall be payable as described in Section 3 of this Agreement. Before any such services are performed; PARS will provide the Agency with written notice of the subject services, terms, and an estimate of the fees therefore. 5. Information Furnished to PARS. PARS will provide the Services contingent upon the Agency's providing PARS the information specified in the exhibit attached hereto as "Exhibit 1 C"("Data"). It shall be the responsibility of the .Agency to certify the accuracy, content and completeness of the Data so that PARS may rely on such information without further audit. It shall further be the responsibility of the Agency to deliver the Data to PARS in such a manner that allows for a reasonable amount of time for the Services to be performed. Unless specified in Exhibit IA, PARS shall be under no duty to question Data received from the Agency, to compute contributions made to the Plan. to determine or inquire whether contributions are adequate to meet and discharge liabilities under the Plan, or to determine or inquire whether contributions made to the Plan are in comDliance Page I with the Plan or applicable law. In addition, PARS shall not be liable for non- performance of Services if such non-performance is caused by or results from erroneous and/or late delivery of Data from the Agency. In the event that the Agency fails to provide Data in a complete, accurate and timely manner and pursuant to the specifications in Exhibit 1C, PARS reserves the right, notwithstanding the further provisions of this Agreement, to terminate this Agreement upon no less than ninety (90) days written notice to the Agency. 6. Suspension of Contributions. In the event contributions are suspended, either temporarily or permanently, prior to the complete discharge of PARS' obligations under this Agreement, PARS reserves the right to bill the Aeency for Services under this Agreement at the rates indicated in PARS' standard fee schedule in effect at the time the services are provided, subject to the terms established in Section 3 of this Agreement. Before any such services are performed, PARS will provide the Agency with written notice of the subject services; terms, and an estimate of the fees therefore. 7. Records. During the term of this Agreement, and for a period of five (5) years after termination of this Agreement. PARS shall provide duly authorized representatives of the Agency access to all records and material relating to calculation of PARS' fees under this Agreement. Such access shall include the right to inspect, audit and reproduce such records and material and to verify reports furnished in compliance with the provisions of this Agreement. All information so obtained shall be accorded confidential treatment as provided under applicable law. 8. Confidentiality. Without the Agency's consent, PARS shall not disclose 'any information relating to the Plan except to duly authorized officials of the Agency and to parties retained by PARS to perform specific services within this Agreement. The Agency shall not disclose any information relating to the Plan to individuals not employed by the Agency without the prior written consent of PARS, except as such disclosures may be required by applicable law. 9. Independent Contractor. PARS is and at all times hereunder shall be an independent contractor. As such. neither the Agency nor any of its officers, employees or agents shall have the power to control the conduct of PARS. its officers, employees or agents, except as specifically set forth and provided for herein. PARS shall pay all wages. salaries and other amounts due its employees in connection with this Agreement and shall -be responsible for all reports and obligations respecting them, such as social security, income tax withholding, unemployment compensation, workers' compensation and similar matters. 10. Indemnification. PARS and Asency hereby indemnify each other and hold the other harmless, including their respective officers, directorsn employees, agents and attorneys, from an), claim, loss, demand, liability, or expense, including reasonable attorneys' fees and costs, incurred by the other as a consequence of PARS' or Agency's. as the case may be, acts, errors; or omissions with respect to the performance of their respective duties hereunder. Paee 2 I 1. Compliance with Applicable Law. The Agency shall observe and comply with federal, state and local laws in effect when this Agreement is executed, or which may come into effect during the term of this Agreement, regarding the administration of the Plan. PARS shall observe and comply v+ith federal, state and local laws in effect when this Agreement is executed, or which may come into effect during the tern of this Agreement, regarding Plan administrative services provided under this Agreement. 12. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. In the event any party institutes legal proceedings to enforce or interpret this Agreement, venue and jurisdiction shall be in any state court of competent jurisdiction. 13. Force Majeure. When satisfactory evidence of a cause beyond a party's control is presented to the other party, and nonperformance was unforeseeable, beyond the control and not due to the fault of the parry not performing, a party shall be excused from performing its obligations under this Agreement during the time and to the extent that it is prevented from performing by such cause, including but not limited to: an), incidence of fire, flood, acts of God, acts of terrorism or war, commandeering of material, products, plants or facilities by the federal, state or local government, or a material act or omission by the other party. 14. Ownership of Reports and Documents. The originals of all letters, documents, reports, and data produced for the purposes of this Agreement shall be delivered to. and become the property of the Agency. Copies may be made for PARS but shall not be furnished to others without written authorization from Agency. 15. Designees. The Plan Administrator of the Agency, or their designee, shall have the authority to act for and exercise any of the rights of the Agency as set forth in this Agreement, subsequent to and in accordance with the written authority granted by the Governing Body of the Agency, a copy of which writing shall be delivered to PARS. Any officer of PARS, or his or her designees, shall have the authority to act for and exercise any of the rights of PARS as set forth in this Agreement. 16. Notices. All notices hereunder and communications regarding the interpretation of the terms of this Agreement, or changes thereto. shall be effected by delivery of the notices in person or by depositing the notices in the U.S. mail, registered or certified mail, return receipt requested, postage prepaid and addressed as follows: (A) To PARS: PARS; 4350 Von Karman Avenue, Suite 100, Newport Beach; CA 92660; Attention: President (B) To Agency: City of Azusa. P.O. Box 1395, Azusa; CA 91702-1395: Attention: [Plan Administrator] Notices shall be deemed given on the date received by the addressee. 17. Term of Agreement. This Agreement shall remain in effect for the period beginning 2012 and ending 2017 ("Term"). This Agreement will continue unchanged for successive twelve-month periods following the Term unless Page 3 either party gives written notice to the other party of the intent to terminate prior to ninety (90) days before the end of the Term. 18. Amendment. This Agreement may not be amended orally, but only by a written instrument executed by the parties hereto. 19. Entire Agreement. This Agreement, including exhibits;` contains the entire understanding of the parties with respect to the subject matter set forth in this Agreement. In the event a conflict arises between the parties with respect to any term, condition or provision of this Agreement, the remaining terms, conditions and provisions shall remain in full force and legal effect. No waiver of any term or condition of this Agreement by any party shall be construed by the other as a continuing waiver of such term or condition. 20. Attorney's Fees. In the event any action is taken by a part}, hereto to enforce the terms of this Agreement, the prevailing party therein shall be entitled to receive its reasonable attorney's fees. 21. Counterparts. This Agreement may be executed in any number of counterparts, and in that event, each counterpart shall be deemed a complete original and be enforceable without reference to any other counterpart. 22. Headings. Headings in this Agreement are for convenience only and shall not be used to interpret or construe its provisions. 23. Effective Date. This Agreement shall be effective on the date first above written, and also shall be the date the Agreement is executed. AGENCY: BY: TITLE: Ci 17 / /LWW46E&L [Plan Administrator] DATE: PARS: BY: TITLE: DATE: Page 4 EXHIBIT IA SERVICES PARS will provide the following services for the City of Azusa: 1. Plan Consultation Services: (A) Meeting with Agency personnel to discuss the impact to the Agency of implementing a Plan; (B) If appropriate, completing a fiscal analysis, based on data and assumptions provided by Agency, to determine the fiscal feasibility of a Plan: (C) Meeting with Agency personnel to discuss the fiscal analysis and receive feedback on the analysis, data; and assumptions made; (D) Making appropriate revisions to the fiscal analysis as directed by Agency 2. Plan Installation Services: (A) Meeting with appropriate Agency personnel to discuss plan provisions. implementation timelines, benefit communication strategies, data reporting and contribution submission requirements; (B) Providing the necessary analysis and advisory services to finalize these elements of the Plan; (C) Providing the documentation needed to establish the Plan for review by Agency legal counsel. 3. Plan Administration Services: (A) Monitoring the receipt of Plan contributions made by the Agency to the trustee of the PARS Trust Program ("Trustee,,), based upon information received from the Agency and the Trustee; (B) Performing periodic accounting of Plan assets, including the allocation of emplover contributions, distributions, investment activity and expenses (if applicable), based upon information received from the Agency and/or Trustee: (C) Acting as ongoing liaison between the Participant and the Agency in regard to distribution payments, which shall include use by the Participants of toll-free telephone communication to PARS; (D) Producing benefit illustrations and processing enrollments: (E) Coordinating the processing of Participant distribution payments pursuant to authorized written Agency certification of distribution eligibility, authorized direction by the Agency, and the provisions of the Plan. and, to the extent possible. based upon Agency -provided Data; (F) Directing Trustee to liquidate Plan assets (if necessary) and make Participant distribution payments. and producing required tax filings regarding said distribution payments; ` Page 5 (G)Notifying the Trustee of the amount of Plan assets available for further investment and management, or. the amount of Plan assets necessary to be liquidated in order to fund Participant distribution payments: (H) Coordinating actions with the Trustee as directed by the Plan Administrator within the scope this Agreement: (I) Coordinating and selecting of a licensed actuary to perform actuarial valuation. if required, on a periodic basis to comply with state and federal laws (the actuarial certification fee for which shall be paid by the Agency).- (J) gency):(.1) Preparing and submitting the Annual Report of Financial Transactions to the California State Controller; as required by law, for the PARS Trust Program, including the required certified audit of the PARS Trust. 4. Plan Compliance Services: Coordinating and preparing chances to the Trust. Plan and other associated legal documents required by federal and state agencies to maintain the Plan in compliance, for review by Agency legal counsel. 5. PARS is not licensed to provide and does not offer tax, accounting, legal, investment or actuarial advice. 6. Any analysis provided by PARS is subject to the receipt of accurate information and assumptions as may be provided by Agency. The Agency is responsible for integrating the PARS analysis into any Agency budgetary analysis or decision-making processes. The 'Fiscal projections in the PARS analysis are dependent upon future experience conforming to the assumptions used and the results will be altered to the extent that future experience deviates from these assumptions. It is certain that actual experience will not conform exactly to the assumptions used in the analysis. Page 6 EXHIBIT 1 B FEES FOR SERVICES PARS will be compensated for performance of Services, as described in Exhibit ]A based upon the following schedule: Upon implementation of the Plan associated with this Agreement. the Agency agrees to pay: (A) An ongoing administration fee equal to five and one-half percent (5.50%) of contributions and/or premiums made by the Agency on behalf of participants in the subject Plan. Fees will be billed to the Trustee as contributions are made by the Agency, and it will be the responsibility of the Trustee to pay those fees from the assets of the Plan. These fees are exclusive of Trustee and investment management fees; which are based on the standard fees charged by the Trustee. (B) A fee equal to actuarial expenses, if any, charged to PARS by an outside contractor for an actuarial valuation of the Agency's Plan ("Actuarial Valuation Fee"). (C) A fee equal to the stated IRS application fees and legal fees related to any ongoing federal and/or state required Plan compliance changes. Such fees will not be charged to the Agency without prior authorization by the Plan Administrator, Page 7 EXHIBIT 1 C DATA REQUIREMENTS PARS will provide the Services under this Agreement contingent upon receiving the following information: I. Participant Data (provided by Agency): (A) Participant's Legal Name (B) Participant's Position (C) Participant's Address (D) Participant's Birth Date (E) Participant's Hire Date (F) Participant's Contract Salary (G) Years of Agency Service (H) Retirement Date 2. Executed Legal Documents (provided by Agency): (A) Certified Resolution (B) Adoption Agreement (C) Plan Document (D) Trustee Investment Forms 3. Completed Funding Documents (provided by Agency): (A) Authorization to Pay Benefits Form (B) Funding of PARS Supplementary Retirement Plan Form 4. Completed Enrollment Forms (timely submitted by Participant): (A) Correction Form (B) Enrollment Form (C) Beneficiary Designation Form (D) Tax Withholding Request Form (E) Letter of Resignation 5. Other information pertinent to the Services as reasonably requested by PARS. Page 8 2012 PARS Supplementary Retirement Plan City of Azusa Miscellaneous Employees With regard to the PARS Supplementary Retirement Plan for 2012, the City proposes the following: 1.0 Eligibility 1.1 Those Miscellaneous employees designated eligible for participation who: - a) Are employed by the City as of June 18, 2012; b) Are fifty five (55) years of age with twenty (20) years of PERS service as of July 30, 2012; c) Resign from City employment effective no later than July 30, 2012; and d) Retire under PERS effective no later than July 31, 2012. 2.0 Participation Requirements 2.1 Participating employees shall submit all required PARS enrollment materials and City Letter of Resignation to PARS on or before the deadline date of July 9, 2012. Resignations of participants are irrevocable as of the enrollment deadline and may not be rescinded unless the City withdraws the incentive pursuant to Paragraph 2.2 below. 2.2 . If after the close of the enrollment window the City determines that the plan does not meet the City's fiscal and operational objectives, the City may withdraw the incentive, provided it notifies the employees of the withdrawal of the incentive on or before July 16, 2012. If the City withdraws the incentive for employees, their Letter of Resignation will be automatically rescinded. 2.3 Participation in the retirement incentive requires: a. Submission of required PARS enrollment materials and City Letter of Resignation to PARS by July 9, 2012; b. Resignation from City employment effective no later than July 30, 2012; and c. Retirement from PERS on or before July 31, 2012. 3.0 Incentive Payments 3.1 Regarding the basic incentive under this plan: a) The basic, unmodified benefit shall be a monthly cash payment for the lifetime of the participant. Prepared by PARS (Public Agency Retirement Services) Pape 1 2012 PARS Supplementary Retirement Plan City of Azusa Miscellaneous Employees The monthly cash payment amount shall equal one -twelfth of sevenercent (7.00%) of Final Pay. p c) For purposes of this plan, Final Pay shall be defined as the employee's current base annual salary as of June 1, 2012. 3.2 Alternative monthly forms of payment of equivalent present value to the basic benefit shall be offered. They shall include: a) Joint -and -survivor payments; b) Payments made for the life of the participant, subject to a ten year minimum; and C) Fixed term payments of from five (5) to fifteen (15) years. These payments are guaranteed to the participant for the full term selected. 3.3 The amount of monthly payment shall be fixed as of July 9, 2012 and shall not be subject to increase thereafter. 3.4 The choice of form of payment (and the choice of payment beneficiary if choosing a joint and survivor form of payment) shall become final as of July 9, 2012 and shall not be subject to change thereafter. 3.5 PARS benefits are to commence September 1, 2012 (paid retroactive to August 1, 2012). 4.0 Contract Administrator 4.1 The Contract Administrator for the Retirement Incentive shall be PARS. 4.2 The fee for PARS shall be 5.5% of plan contributions to the PARS Trust for services related to the Supplementary Retirement Plan. Prepared by PAPS (Public Agency Retirement Services) Pate 2 2012 PARS Supplementary Retirement Plan City of Azusa Miscellaneous Employees Projected Timeline: 1. Initial PARS Introductory Meeting 2. Enrollment Packets Mailed to- Employees' Home 3. Employee Orientation Meeting/Workshop 4. Enrollment Window Closes 5. PARS Provides Post Analysis 6. City announces whether Plan goes forward 7. Employees Resign from City employment 8. Employees Retire under PERS 9. City funds SRP 10. PARS Benefits Commence May 23, 2012 Week of June 18, 2012 Late June 2012 July 9, 2012 July 11, 2012 on or before July 17, 2012 on or before July 30, 2012 on or before July 31, 2012 no later than August 10, 2012 September 1, 2012 (paid retroactive to August 1) rivNeieo oy rN,rs (ruouc i -agency Retirement Services) pate J