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CC Resolution No. 6455 RESOLUTION N0. 6455 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CUPERTINO AMENDING RESOLUTION N0. 4082 The City Council of the City of Cupertino resolves that Resolution No. 4082 is amended per attached Exhibit "A". Passed and adopted at a regular meeting of the City Council of the City of Cupertino this 4th day of February , 1985 by the following vote: Vote Members of the City Council AYES: Gatto, Plungy, Rogers, Sparks, Johnson NOES: IJone ABSENT: None ABSTAIN: None ATTEST: APPROVED: Dorothy Cornelius /s/ Phil N. Johnson City Clerk Mayor, City of Cupertino GXH1B1'i ~ RESOL[1T10N N0. 6455 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CUPERTINO AMENDING RESOLUTION :JO. 4082 The City Council of the City of Cupertino resolves that Resolution No. 4082 is amended as follows: SECTION l. NAh1~: The name of the Plan is CiCy of Cupertino lleferred Compensation Plan hereinafter referred to as the "Plan". SECTION 2. PURPOSE: The primary purpose of the Plan is to attract and hold personnel by permitting them to enter into agreemenCs with the City of Ciipertino Deferred Compensation Plan which will provide future pay- ments in lieu of deferred current income upon death, disability, retirement, or other termination of employment. The Plan is intended to qualify as an eligible State Deferred Compensation Pla~i within the meaning of Section 457 of the Internal Revenue Code bf 1954, as amended (hereinafter referred to as the "Code"). SECTION 3. DGFINITIONS: For Che purposes of this Plan, certain words or phrases used herein will have the following meanings: 3.1 "Employer" shall mean the City of Cupertino. 3.2 "Employee" shall mean a management, supervisory or other full- time or permanent part-Cime employee, City Council member or CiCy AtCorney of the Employer who has been designated by the Employer. 3.3 "Participant° shall mean an employee who has elected to parti- cipace in the Plan. Only individuals who perCurm service for the Employer may be participants. 3.4 "Parti.cipation Agreement" shall. mean the agreement execuCed e~nd filed by an Employee with the F,mployer pursuant to Section 4, in which the Employee elects to become a participanC in Lhe Plan. 3.5 "Compensation" shall mean the salary of wages which would be paid by the F.mployer to or for the benefit of an employee (if they were not a Participant in the Plan) for actual services performed by the Employee. • 3.6 "Includible Compensation" shall mean compensation received from the Employer that is attributable to services performed for the Employer and that is includible in the Participant's gross income for the taxable year. Accordingly, a Participant's ineludible compensation for a taxable year does not include any amount payable by the Employer that is excludible from the Participant's gross income under Section 457, Section 403(b), Section 105(d) and Section 971 of the Code. A Participant's includible compensation for a taxable year is determined without regard to any Community Property laws. 3•7 "Deferred Compensation" shall mean the amount of Compensation which the Participant and the Employer mutually agree shall be deferred in accordance with the provisions of this Plan. 3•8 "Disability" means the inability of a Participant to engage in his/her usual occupation by reason of a medically determinable physical or mental impairment as determined by the Employer on the basis of advice from a physician or physicians. 3•9 "Normal Retirement Age" shall mean, as to each participant, the age designated by the Participant in the range of ages ending with 70 1/2 years and beginning with the earliest age at which Participant could retire with no actuarial reduction in benefits under the retirement plan, but in any event not later than the date or age which Participant separates from the service of the Employer. 3.10 "Normal Retirement" shall mean retirement from service with the Employer which becomes effective on the Participant's attainment of Normal Retirement Age. 3.11 "Early Retirement" shall mean retirement from service with the Employer which becomes effeetive on the first day of the calendar month after the Participant meets the age requirements for early retirement specified in the Employer's qualified retirement plan. 3.12 "Late Retirement" shall mean retirement from service with the Employer which becomes effective after the Participant has passed the Normal Retirement Age. 3.13 "Termination of Employment" shall mean the ~@~@P~~~~ ~f bhe Pertioipant's employment with the Employer prior to retirement. SECTION 4. PARTICIPATION: 4.1 Each Employee may elect to become a Participant • of the Plan and defer payment of his/her Compensation by executing and delivering to the Employer a written Participation Agreement. At the Employer's option, there may be established one or more entry dates during the year. Deferral may not start until the calendar month following the month in which the Participation Agreement is executed and filed with the Employer. 4.2 The Participation Agreement shall state the amount of Compensation to be deferred pursuant to the Plan, which shall not exceed the amounts provided in Sections 5.2 and 5.3 below. 4.3 A Participant may revoke his/her Participation Agreement by filing with the Employer an executed written notice of revocation for that portion which they voluntarily defer. In the event such notice of revocation is filed, it will take effect the first pay period of the following month. A Participant who revokes his/her voluntary deferral may not resume voluntary deferrals until the next open enrollment period. No amounts shall be payable to an Employee upon revocation of his/her Participation Agreement unless otherwise due pursuant to Section 10. SECTION 5. DEFERRAL OF COMPENSATION: 5.1 For.each month in which a Participation Agreement of an Employee is in effect, the Employer shall not pay the Employee his/her full compensation, but shall defer payment of such part of his/her Compensation as is specified by the Employee in the Participation Agreement. 5.2 Except as provided in Section 5.3, the maximum amount that may be deferred under the Plan for any taxable year of a Participant shall not exceed the lesser of: 1. $7,500; or 2. 33 1/3 of the Participant's Includible Compensation for the taxable year, reduced by any amount excludible from the Participant's gross income for the taxable year under Section 403 (b) of the Code on account of contributions made by the Employer. If the Employer contributes additional amounts into the Plan, the maximum amount that may be deferred by the Participant shall be reduced by the amount of the Employer's contribution. • 5.3 For any one or more of a Participant's last three ~3) taxable years ending before such Participant attains Normal Retirement Age, the maximum amount ~ that may be deferred under the Plan for any taxable year of the Participant shall not exceed the lesser of $15,000 or the sum of the maximum amount that could be deferred for such taxable year under Section 5•2 above (without regard to this Seetion), plus so much of the maximum amount that could be deferred for all prior taxable years, beginning after December 31, 1978, under Section 5.2 (without regard to this Section) as has not theretofore been deferred. In no event may the amount of Deferred Compensation for the year exceed the total amount of Compensation for the year. This Section shall be interpreted and applied consistent with Section 457~b)(2) and (3) of the Code. 5.~ If an individual is a Participant in more than one eligible State Deferred Compensation Plan established pursuant to Section 457 of the Code, the amount of Compensation deferred under this Plan when added to the Compensation deferred aJl such other Plans, may not exceed the maximum amounts set forth in Sections 5.2 and 5.3 above. SECTION 6. ADMINISTRATION OF THE PLAN: 6.1 The Employer shall have full authority and power to adopt the rules and regulations for the administration of the Plan, and to interpret, amend, alter, and revoke any rules and regulations so adopted. 6.2 The Employer may, at its option, establish one or more Deferred Compensation Plan Funds to which Deferred Compensation is credited at such times as the Compensation would have been payable to individual employees if they were not Participants in the Plan. SECTION 7. EARNINGS OF THE FUND: If a fund is established pursuant to Section 6.2, and such fund is invested and reinvested in a manner intended to increase Plan assets, the net earnings of such fund may be accumulated and held in the fund, provided that such assets remain the unrestrieted assets of the Employer as set forth in Section 8 below. SECTION 8. ASSETS OF THE PLAN: All amounts of Compensation deferred under the Plan, ' all property and rights purchased with such amounts, and all income attributable to such amounts, or rights shall remain solely the property and rights of the Employer, subject only to the claims of the Employer's general creditors, until made available to the participant or other beneficiary. The obligation of the Employer to a Participant for payment of the Deferred Compensation and increments thereon referred to in this Plan is a contractual obligation only and Participants shall have no preferred or specific interest by way of trust, escrow, annuity or otherwise, in and to the specifie assets or funds that may be established. SECTION 9. MAINTENANCE OF BOOK ACCOUNTS: A book account shall be maintained for each Participant. There shall be credited to the book aceount all amounts of Compensation deferred under the Plan and all income attributable to such amounts. 'The income attributable to an amount shall mean the actual earnings of the fund established pursuant to Section 6.1 of the Plan if such a fund is established by the Employer, allocated on a pro rata basis but in no event less than the earnings that would have been earned if the amounts deferred had been invested from time to time in one or more of the various investment options available within the Plan. SECTION 10. DISTRIBUTION OF BENEFITS: Distribution of benefits to each Participant shall commence not later than sixty (60) days after the end of the calendar year following a distribution event. The Participant must elect a mode of distribution irrevocably not less than thirty (30) days prior to the date on which distribution is to commence. In the event a distribution event occurs prior to the date the Participant attains (or would have attained) Normal Retirement Age the Participant may irrevocably elect, prior to the time the amounts become payable, to defer payment of some or all of such amounts until such time as the Participant attains Normal Retirement Age. 10.1 Retirement: In the event of early, normal or late retirement, the amount credited to the Participant's book aceount shall be distributed to them in any one or more of the methods stated in Section 11. . 10.2 Termination of Employment: In the event of the Participant's termination of employment with the Employer all amounts credited to the Participant's book account shall be distributed to them in any one or more of the methods as stated in Section 11. 10.3 Disability: In the event of termination of employment by reason of disability distribution of all amounts in the Participant's book account shall be distributed to them in any one or more of the methods as stated in Section 11. 10.4 Death: In the event of the death of the Participant prior to the commencement of distribution, all amounts credited to his/her book account shall be distributed to the named beneficiary(ies) or estate. In the event death, beneficiary may, at that time, elect distribution by all methods which were available to Participant. The only exception is that a non-spousal beneficiary must take distribution over a period not to exceed fifteen (15) years. SECTION 11. METHOD OF DISTRIBOTION: 11.1 All funds credited to a Participant's book account shall be distributed to them or their beneficiary in the case of Death Benefits by any one or more of the following methods: 11.1a. In a lump sum. 11.1b. In monthly, quarterly, semi-annual or annual installments for a fixed number of years, not to exceed the life expectancy of the Participant, or Participant and his/her spouse. Life expectancy shall be determined by the funding agency based on the date the initial distribution shall begin. 11.1c. A life annuity purchased by the Employer. 11.2 Upon request of a Participant, the Employer may allow commencement of distribution of the Participant's book account to be delayed not Q~@~ ~ays after the end of the calendar year in which the Participant retires. SECTION 12. EMERGENCY WITHDRAWALS: If a Participant is faced with an emergency, the Participant may apply to the Employer for withdrawal from the Plan prior to retirement or other termination of the Participant's service with the Employer. Such withdrawals shall be permitted, in the Employer's discretion, only in circumstances of severe emergencies which are beyond the Participant's control, which would cause the Participant great financial hardship if early withdrawal were not permitted and which are otherwise within the meaning of the term "unforeseeable emergency" as defined in Section 457~b)(5) of the Code, and as interpreted by such regulations as may be promulgated by the Secretary of the Treasury. SECTION 13. TRANSFERS: 13.1 The Employer shall accept funds from other eligible State Deferred Compensation Plans established pursuant to Section 457 of the Code to be transferred and added to the Participant's book account within the Plan provided that all of the following conditions exist: 13.1 a. The funds so transferred were deferred by the Participant from Compensation while employed by a political subdivision located in the State of California and; 13•2 b. The funds so transferred are from a plan that provides that if the Participant separates from services in order to accept employment with another political subdivision located in the State of California, payout will not commence upon separation from service, regardless of any other provision of the plan, and amounts previously deferred will automatically be transferred. 13•2 Amounts deferred by a former Participant shall be transferred to another eligible plan of which the former Participant has become a participant provided that the other plan is sponsored by an entity within the same State as the Employer and the plan receiving such amounts provides for the acceptance of the amounts. 13•3 Regardless of any other provision of the Plan, if the Participant separates from service with the Employer in order to accept employment with another political subdivision located in the ~~~~@ @~ ~~~~~~~~~~s ~a~out ~ill not commence upon separation from service and amounts previously deferred will automatically be transferred. SECTION 14. EMPLOYER PARTICIPATION: Notwithstanding any other provision of this Plan, the ~ Employer may, by means of additional deposits in any Deferred Compensation Plan fund or otherwise, provide for additional Deferred Compensation for the services rendered by any Employee to the Employer during any year, but is subject to the limitations in Section 5.2. SECTION 15. NON-ASSIGNABILITY CLAUSE: It is agreed that neither the Participant nor his/her beneficiary, nor any other designee, shall have any right to commute, sell, assign, transfer, or otherwise convey the right to receive any payments hereunder, which payments and right thereto are expressly declared to be non-assignable and non-transferable, and in the event of any attempted assignment or transfer, the Employer shall have no further liability hereunder nor shall any payments be transferable by operation of law in event of bankruptcy or insolvency, except to the extent otherwise provided by law, notwithstanding the above clause. SECTION 16. COMMUNICATION: Any notice, filing or communication directed to the Employer shall be mailed or delivered to the following address: City of Cupertino Deferred Compensation Plan 10300 Torre Avenue Cupertino, California 95014 Any notice or communication directed to any Participant shall be mailed or delivered to the address provided in his Participation Agreement. SECTION 17. AMENDMENT OR TERMINATION OF PLAN: The Employer may, at any time, terminate this Plan for all Participants. Upon such termination, each Participant in the Plan will be deemed to have revoked his/her Participation Agreement as of the date of such termination. The Employer may also amend the provisions of this Plan at any time; provided, however, that no amendment shall affect the rights of the Participants or their beneficiaries to the receipt of payment of benefits, to the extent of any compensation deferred at the time of the amendment as adjusted for income attributable to such Deferred Compensation prior to and subsequent to the amendment. This Plan is intended to qualify as an eligible State Deferred Compensation Plan under Section 457 of the Code, and sh`all be interpreted and administered in a ' manner consistent with such qualification. The Employer reserves the right to amend the Plan to the extent that may be necessary to conform the Plan to the requirements of Section 457 of the Code and any other applicable law, regulation or ruling, including amendments that are retroactive to the effective date of the Plan. In the event that the Plan is deemed by the Internal Revenue Service to be administered in a manner ineonsistent with Section 457 of the Code, the Employer shall correct such administration within the period provided in Section 457~b) of the Code. The Employer reserves the right to take such action and do such things as are required to make the Plan, as administered, consistent with Section 457 of the Code. The Employer hereby establishes this Deferred Compensation Plan on the terms and conditions set forth herein. ~ r , - p a DATE: ? 1 3 BY: , ~ity Manager BY: /f`., ~~f f ~i ri,~/ ~~li-~ Citiy Clerk APPR011ED AS,,3~~ ORMc ~ ~ ~ ~ ~ /~s~' ~ % ~ " ity Attorney