§ 13-7. Retirement dates and benefits,

(a)

Normal retirement date. Supervisory officers and officer members who are members of the plan as of September 30, 2012 may retire on the first day of the month co-incident with or next following that date on which such member completes twenty (20) years of continuous service regardless of age or attainment of the member's fifty-fifth (55) birthday and completion of ten (10) years of credited service. Effective October 1, 2012, supervisory officers and officer members joining the plan may retire on the first day of the month co-incident with or next following that date on which such member completes twenty-five (25) years of continuous service regardless of age or attainment of the member's fifty-fifth (55) birthday and completion of ten (10) years of credited service. Any member who, on or after May 1, 2008, elects to retire and:

(1)

Terminates employment with the city (whether by way of pre-arranged mutual agreement, resignation or any other means);

(2)

After attaining one of the normal retirement ages specified in this subsection 13-7(a) that is based solely on the completion of the applicable service condition;

(3)

May elect to commence distribution of normal retirement benefits (and notwithstanding anything in subsection 13-7(k) to the contrary, may elect to receive payments from his DROP account) and the distribution of such benefits shall continue regardless of the fact that such member is rehired by the city (whether by way of pre-arranged mutual agreement or otherwise) provided that the member is rehired as a part-time police officer, seasonal school resource officer, chief of police, or any civilian position;

(4)

A member shall become one hundred (100) per cent vested in his benefits provided by the plan upon attaining normal retirement age;

(5)

Any benefit payments described in this subsection 13-7(a) that become payable after a member's termination of employment and rehire that occurs pursuant to a pre-arranged mutual agreement with the city shall be considered to be an "in-service distribution."

(b)

Normal retirement benefit.

(1)

Amount. The monthly normal retirement benefit shall be an amount determined as follows: three (3) per cent of average monthly earnings for an officer retiring or entering the DROP after September 30, 2012 and before December 16, 2015 and three and one-quarter (3.25) per cent of average monthly earnings for an officer retiring or entering the DROP after December 15, 2015 times continuous service.

In any event, the retirement benefit cannot be less than two (2) per cent of average monthly earnings for each year of continuous service. The initial maximum monthly normal retirement benefit shall be an amount equal to the greater of:

(i)

Seventy-five (75) per cent of average monthly earnings for an officer retiring or entering the DROP after September 30, 2012 and before December 16, 2015 and eighty-one and one-quarter (81.25) per cent of average monthly earnings for an officer retiring or entering the DROP after December 15, 2015, not to exceed one hundred ten thousand dollars ($110,000.00) per year; or

(ii)

Two (2) per cent of average monthly earnings for each year of continuous service.

The normal retirement benefit amount shall apply only to service on or after October 1, 2012, except that members who have attained twenty (20) years of service as of October 1, 2012 shall accrue benefits at the normal retirement benefit plus amount.

(2)

Duration survivor benefit. A member retiring hereunder on his normal retirement date shall receive, upon his written request to the board, a monthly benefit which shall commence on his normal retirement date and be continued thereafter during his lifetime. The normal form of benefit is a life annuity, under which benefits cease upon the member's death. A member must elect in writing to have the benefit paid in the normal form. Alternatively, an optional form of benefit payment providing a survivor benefit may be selected in writing by the member prior to actual retirement. If no written election is made, the benefit will automatically be actuarially reduced and paid in the form of a ten-year certain and life thereafter annuity. In any event there shall be paid to or in behalf of such member or his beneficiaries an amount equal to such member's accumulated contributions.

(c)

Normal retirement benefit plus.

(1)

Amount. The monthly normal retirement benefit plus shall be an amount determined as follows:

3.5% of average monthly earnings plus times continuous service. In any event, the retirement benefit cannot be less than two (2) per cent of average monthly earnings plus for each year of continuous service. The maximum monthly retirement benefit plus shall be an amount equal to the greater of:

(i)

Eighty-seven and one-half (87.5) per cent of average monthly earnings; or

(ii)

Two (2) per cent of average monthly earnings for each year of continuous service, in each case.

The normal retirement benefit plus amount shall apply only to service before October 1, 2012. Members who have attained twenty (20) years of service as of October 1, 2012 shall accrue benefits at the normal retirement benefit plus amount.

(2)

Duration survivor benefit. A member retiring hereunder on his normal retirement date shall receive, upon his written request to the board, a monthly benefit which shall commence on his normal retirement date and be continued thereafter during his lifetime. The normal form of benefit is a life annuity, under which benefits cease upon the member's death. A member must elect in writing to have the benefit paid in the normal form. Alternatively, an optional form of benefit payment providing a survivor benefit may be selected in writing by the member prior to actual retirement. If no written election is made, the benefit will automatically be actuarially reduced and paid in the form of a ten-year certain and life thereafter annuity. In any event there shall be paid to or in behalf of such member or his beneficiaries an amount equal to such member's accumulated contributions.

(d)

Early retirement date. A member may retire on the first day of the month coincident with or next following the attainment of age fifty (50) and the completion of ten (10) years of continuous service.

(e)

Early retirement benefit. A member retiring hereunder on his early retirement date may receive, upon his written request to the board, either a deferred, or an immediate monthly retirement benefit as follows:

(1)

A deferred monthly retirement benefit which shall commence on his normal retirement date and shall be continued on the first day of each month thereafter during his lifetime. The amount of the benefit shall be determined and paid in the same manner as for retirement at his normal retirement date except that average monthly earnings and continuous service shall be determined as of his early retirement date, or

(2)

An immediate monthly retirement benefit which shall commence on his early retirement date and shall be continued on the first day of each month thereafter during his lifetime. The benefit payable shall be as determined in section 13-7(b)(1) hereof, reduced for the actual years and months by which the starting date of the benefit precedes the normal retirement date. The reduction factors shall be as on the following:

EARLY RETIREMENT CHART

Years and Months Early	Factor
0
1	.99444
2	.98889
3	.98333
4	.97778
5	.97222
6	.96667
7	.96111
8	.95556
9	.95000
10	.94444
11	.93889
1
0	.93333
1	.92778
2	.92222
3	.91667
4	.91111
5	.90556
6	.90000
7	.89444
8	.88889
9	.88333
10	.87778
11	.87222
2
0	.86667
1	.86111
2	.85556
3	.85000
4	.84444
5	.83889
6	.83333
7	.82778
8	.82222
9	.81667
10	.81111
11	.80556
3
0	.80000
1	.79444
2	.78889
3	.78333
4	.77778
5	.77222
6	.76667
7	.76111
8	.75556
9	.75000
10	.74444
11	.73889
4
0	.73333
1	.72778
2	.72222
3	.71667
4	.71111
5	.70556
6	.70000
7	.69444
8	.68889
9	.68333
10	.67778
11	.67222
5
0	.66667

 

(f)

Delayed retirement date. The delayed retirement date shall be that date following normal retirement date on which a member actually retires.

(g)

Delayed retirement benefit. A member retiring hereunder at his delayed retirement date shall receive, upon his written request to the board, a monthly retirement benefit which shall commence on the first day of the month coincident with or next following such delayed retirement date. The amount of each such monthly retirement benefit shall be determined in the same manner as for normal retirement except that average monthly earnings and continuous service shall be determined as of the member's actual retirement date. The benefit shall be paid as provided in subsection 13-7(b)(2).

(h)

Applicable benefit formula. The benefit formula applicable in all cases of retirement, whether normal, early or delayed, shall be that in effect on the member's employment termination date.

(i)

Cost of living adjustment. A cost-of-living adjustment (COLA) shall be applied to a member's retirement benefit as follows:

(1)

For any member who attained twenty (20) years of service as of October 1, 2012, the benefit formula as currently calculated in this section 13-7, whether normal, early, or delayed, shall be adjusted annually by two and one-half (2.5) per cent as of the first day of January each year. A prorated portion of the COLA will be applied on the first January 1st subsequent to retirement.

(2)

For any member who has not attained twenty (20) years of credited service as of October 1, 2012, the benefit formula as currently calculated in this section 13-7, whether normal, early, or delayed, shall be adjusted on a pro rata basis:

A.

Annually by one (1) per cent as of the first day of January each year, after a five-year delay for all credited service earned on or after October 1, 2012. The one (1) per cent plus a prorated portion of the COLA will be applied on the first January 1st five (5) years subsequent to eligibility.

B.

Annually by two and one-half (2.5) per cent as of the first day of January each year for all credited service earned prior to October 1, 2012. A prorated portion of the COLA will be applied on the first January 1st subsequent to retirement.

(j)

Voluntary early retirement programs.

(1)

Voluntary early retirement program (1995). All active full-time members of the plan who are either (i) age fifty-three (53) with three (3) years of continuous service, or (ii) have eighteen (18) years of continuous service regardless of age may participate in this voluntary early retirement program offered by the city. In order to participate, the member must have notified the city of his/her intent to participate by end of business on February 27, 1995, with a retirement date of no later than June 30, 1995. Participants retiring under the program will receive a monthly retirement of three and thirty-three hundredths (3.33) per cent of base salary on retirement date times continuous service. For purposes of determining base salary participants whose base salary has not been increased by the twenty-year two and one-half (2.5) per cent longevity benefit prior to retirement will have their base salary increased by two and one-half (2.5) per cent when calculating the monthly benefit. Additionally, participants will receive two (2) years of health benefits from the date of retirement under the city's existing group health plan at premium rates applicable to active employees. Following this period each participant will receive three hundred dollars ($300.00) per month from the plan until the employee reaches age sixty-five (65) to assist participant in procuring continuing insurance coverage. If the early retiree is subsequently employed and is eligible to receive health insurance from the new employer, said insurance shall be primary and the insurance purchased from the city shall be secondary so long as the employee remains eligible for the insurance provided by the new employer. If the other employment ends, the employee would be able to elect city health plan coverage as primary again. A participant who does not continue coverage with the city either as primary or secondary cannot choose to have city health plan coverage at a later date.

(2)

Voluntary early retirement program (1993).

All active full-time members of the plan who on or before December 31, 1992 (a) attains age forty-eight (48); and (b) completes eighteen (18) years of continuous service may retire on any date up to and including December 31, 1992. Participants retiring under the program will receive a monthly retirement of three (3) per cent of base salary on retirement date times continuous service. Continuous service shall mean that number of years and completed months determined without the application of this amendment, plus two (2) full years. Average monthly earnings means one-twelfth ( 1/12 ) of the member's earnings for the last twelve (12) months of employment. Additionally, participants will receive two (2) years of health benefits from the date of retirement under the city's existing group health plan at premium rates applicable to active employees. Following this period each participant will receive three hundred dollars ($300.00) per month credit towards the full cost of city health coverage. If the early retiree is subsequently employed and is eligible to receive health insurance from the new employer, said insurance shall be primary and the insurance purchased from the city shall be secondary so long as the employee remains eligible for the insurance provided by the new employer. If the other employment ends the employee would be able to elect city health plan coverage as primary again. A participant who does not continue coverage with the city either as primary or secondary cannot choose to have city health plan coverage at a later date.

(3)

Future retirement programs. Nothing herein shall prohibit or restrict the city from offering plan members other voluntary early retirement programs or benefits. The city will comply with all necessary notice, approval and funding requirements provided by law.

(k)

Deferred retirement option plan.

(1)

A deferred retirement option plan is hereby created.

(2)

A member shall become eligible for participation in the DROP on the first day of the month coincident with or next following their normal retirement date.

(3)

At the time of a member's entry into the DROP, the member's continuous service, accrued benefit and average monthly earnings shall be calculated as if the member had actually retired from service. There shall be no further member contributions after entry into the DROP. No additional continuous service shall be earned after entry into the DROP. Any changes in plan benefits shall not apply to members in the DROP, unless otherwise applicable to retired members of the plan.

(4)

The member shall select the retirement option from the list available in section 13-11 of the City Code and shall designate any beneficiary. In the absence of a beneficiary designation or should the designated beneficiary pre-decease the member, the member's estate shall be the contingent beneficiary.

(5)

The maximum period of DROP participation shall be five (5) years.

(6)

An election to participate in the DROP plan shall constitute an irrevocable election to resign from the service of the city not later than sixty (60) months after commencement of DROP participation. Consistent with the provisions of the Older Worker's Benefits Protection Act, 29 U.S.C. § 626(f), as amended, all DROP participants shall be given forty-five (45) days in which to consider the terms of the DROP agreement and, after election to participate in the DROP, shall have seven (7) days following the execution of such agreement to revoke said agreement.

(7)

Upon entry into the DROP, an amount equal to the member's monthly retirement benefit shall be transferred to an account within the plan designated by the member for investment. Members may direct their DROP money to any of the investment options approved by the board from the investments made available by the vendor selected by the city. The only permissible investment options shall be "regulated investment companies" as defined in IRC Section 851 or similar entities (e.g. mutual funds, etc.). If the city desires to alter the available investment options of the manner of investing member DROP accounts or the methodology for allocating investment experience to member DROP accounts, such changes shall satisfy the definitely determinable benefit requirements contained in IRC Section 401(a)(25) and Section 1.401-1(b)(1)(i) of the regulations. The amount of any net appreciation, depreciation, gain or loss resulting from the investment and reinvestment of the members' DROP accounts shall be allocated to the individual account of each member. Under the DROP, the individual accounts shall be adjusted for investment gains and losses on a daily basis. The amount of the member's monthly retirement benefit that is transferred to the member's DROP account shall be adjusted to take account of any COLA available under the plan to retired members.

(8)

There shall be no guaranteed rate of investment return on DROP deposits accounts. Upon transfer of the DROP money to the account designated by the member, neither the city nor the plan shall have any obligation to the member concerning investment gains or losses. Transfers between accounts shall be in accordance with the rules of the deferred compensation program.

(9)

The decision to participate in the DROP is irrevocable.

(10)

Upon entry into the DROP, a member shall no longer be eligible for death or disability benefits under the plan. In the event of a disability or death, the member shall be presumed to have retired on a normal retirement on the day prior to the disability or death. Distribution from the DROP account shall be made to the member, or in the case of the member's death, to the member's designated beneficiary.

(11)

Except as members rehired pursuant to subsection 13-7(a)(3) of this Code, no member may receive a distribution from the DROP until actual separation from service. Distribution from the DROP may be received, upon written election to the board, in a lump sum, periodic payments, an annuity, or a combination. A member may also elect to rollover the DROP account to another qualified retirement plan, including an individual retirement account. Distribution from the DROP must commence not later than provided in IRC Section 401(a)(9). It is the intent of the city that this plan at all times be a qualified plan as determined by IRC Section 401(a).

(12)

During DROP participation, a member shall be considered a retiree with deferred receipt of benefits for all plan purposes. For all other purposes, the member shall be considered an active employee of the city entitled to all rights of employment.

(13)

The board shall be empowered to promulgate uniform rules for the administration of the DROP, provided the rules are not inconsistent with the provisions of this plan.

(Ord. No. 94-153, § 1, 12-6-94; Ord. No. 94-157, § 2, 12-20-94; Ord. No. 96-126, § 1, 7-16-96; Ord. No. 98-117, § 3, 7-21-98; Ord. No. 99-119, § 3, 7-20-99; Ord. No. 99-128, § 2, 10-5-99; Ord. No. 2000-120, § 2, 8-15-00; Ord. No. 2001-114, § 3, 7-17-01; Ord. No. 2004-118, § 4, 8-17-04; Ord. No. 2007-124, § 3, 12-11-07; Ord. No. 2012-112, § 3, 9-18-12; Ord. No. 2013-115, § 2, 9-18-13; Ord. No. 2014-100, § 2, 4-2-14; Ord. No. 2015-125, § 2, 12-16-15; Ord. No. 2017-104, § 2, 5-17-17)