HomeMy WebLinkAboutres1998-0061. WI-L4 TCOM COUNTY COUNCIL AGENDA BILL NO. 98-081
CLEARANCES
Initial .
Date
Date Received in Council Office:
Agenda date
Assigned to: Finance/Council
Originator: Human Resources
1/30/98r=--�
2/10/98
Finance Council
Avision Head:
Dept. Head:
.1913
VE", A 41,92)
Prosecutor:
I 1h Ige
tt
Purchasing/Budget:
WUNGIL
Executive•
SUBJECT. •
To provide Whatcom County employees with a choice of investing their personal funds with another deferred
compensation plan provider (in addition to ITT Hartford).
ATTACHMENTS:
Resolution Establishing a Deferred Compensation Plan for Whatcom County employees with ICMA/Retirement
Corporation.
SUMMARY STATEMENT. • Please complete sections of box as appropriate & explain the item below.
Related county contract#: Should Clerk schedule a hearing? NonU Yes// Requested date:
Amount budgeted for this item/project: Is it (or will it be) within budget? Yes/X/ No/ / (Please explain below)
ludget line item number(s):
There is no budget impact since the deferred compensation program involves employees' personal funds.
ORIGINATOR'S RECOMMENDED ACTION.-
Approve
COMMITTEE ACTION TAKEN:
COUNCIL ACTION TAKEN:
1998-81 2/10/98: Arhended & Approved 7 - 0, Res. #98-006
Ordinance or Resolution Number (this item only):
SPONSORED BY: Consent
PROPOSED BY: Consent
INTRODUCTION DATE: 2/10/98 i-
RESOLUTION NO. 98-006
ESTABLISHING A DEFERRED COMPENSATION PLAN FOR
WHATCOM COITNTY EMPLOYEES WITH ICMA - RETIREMENT CORPORATION
WHEREAS, Whatcom County has employees rendering valuable services; and
WHEREAS, the maintenance of deferred compensation plan options for such employees
serves the interests of Whatcom County by enabling it to provide reasonable retirement security
for its employees, by providing increased flexibility in its personnel management system, and by
assisting in the attraction and retention of competent personnel; and
WHEREAS, Whatcom County has determined that having a deferred compensation, plan
administered by the ICMA- Retirement Corporation serves the above objectives; and
WHEREAS, Whatcom County desires that the ICMA- Retirement Corporation administer
a deferred compensation plan and that the funds held under such a plan be invested in the ICMA
Retirement Trust, a trust established by public employers for the collective investment of funds
held under their retirement and deferred compensation plans;
NOW THEREFORE BE IT RESOLVED that Whatcom County hereby implements the
ICMA- Retirement Corporation Deferred Compensation Plan and Trust, referred to as Appendix
A.
BE IT FURTHER RESOLVED that the Employer hereby executes the Declaration of
Trust of the ICMA Retirement Trust, attached hereto as Appendix B.
BE IT FURTHER RESOLVED that the assets of the Plan shall be held in trust, with
Whatcom County serving as trustee, for the exclusive benefit of the Plan participants and their
beneficiaries, and the assets shall not be diverted to any other purpose. Whatcom County's
beneficial ownership of Plan assets held in the ICMA- Retirement Trust shall be held for the .
farther exclusive benefit of the Plan participants and their beneficiaries. Notwithstanding the
foregoing, all Plan provisions creating a Trust to hold all the assets of the Plan for the exclusive
benefit of participants and beneficiaries shall become effective once the appropriate body makes
the necessary amendments permitting the establishment and maintenances of such a Trust.
BE IT FURTHER RESOLVED that Whatcom County hereby agrees to serve as trustee
under the Plan.
BE IT FURTHER RESOLVED that the head of Human Resources or designee shall be
the coordinator for this program; shall receive necessary reports, notices, etc. from the ICMA
Retirement Corporation or the. ICMA Retirement Trust; shall cast, on behalf of Whatcom
County; any required votes under the ICMA Retirement Trust; shall assign administrative duties
to carry out the plan to the appropriate departments,'and is authorized to execute all necessary
agreements with ICMA Retirement Corporation incidental to the administration of the Plan.
APPROVED this 10th day of February, 1998.
ATTEST:
Dana Brown - Davis, C er the Council
APPROVED AS TO FORM:
Ql � f- ��
Civil Deputy Prosecutor
WHATCOM COUNTY COUNCIL
WHATCOM COUNTY, WASHINGTON
Ro ert A. Imhof, ouncil hair
APPENDIX A
4S7 Plan Adoption Package Retain Document
Deferred Compensation Plan Document and Trust. Noremier 1996
COMPENSATION PLAN
& TRUST
Article 1. Purpose
The Employer hereby establishes the Employer's De-
ferred Compensation Plan and Trust, hereafter referred
to as the "Plan." The Plan consists of the provisions set
forth in this document.
The primary purpose of this Plan is to provide retirement
income and other deferred benefits to the Employees of the
Employer and the Employees' Beneficiaries in accordance
with the provisions of Section 457 of the Internal Rev-
enue Code of 1986. as amended (the "Code").
This Plan shall be an agreement solely between the
Employer and participating Employees.' The Plan and
Trust forming apart hereof are established and shall be
maintained for the exclusive benefit of eligible Employ-
ees and their Beneficiaries. No part of the corpus or
income of the Trust shall revert to the Employer or be
used for or diverted to.purposed other than the exclu
sive benefit of Participants and their Beneficiaries.
Article II. Definitions
2.01 Account: The .bookkeeping account maintained
for each Participant reflecting the. cumulative amount of
the Participant's Deferred Compensation, including any
income, gains, losses, or increases.or decreases in market
value attributable to the Employer's investment of the
Participant's Deferred Compensation, and further
reflecting any distributions to the Participant or the
Participant's Beneficiary and any fees or expenses
charged against such Participant's Deferred Compensation.
2.02 Accounting Date: Each business day that the
New York Stock Exchange is open for trading, as
provided in Section 6.06 for valuing the Trust's assets.
2.03 Administrator: The person or persons named to
carry out certain nondiscretionary.administrative func-
tions under the Plan, as hereinafter described. The
Employer may remove any person as Administrator
upon 60 days' advance notice in writing to such person,
in which case the Employer shall name another person
or persons to act as Administrator. The. Administrator
may resign upon 60 days' advance notice in writing to
the Employer, in which cue the Employer shall name
another person or persons to act as Administrator.
2.04 Beneficiary: The person or persons designated by
the Participant in his Joinder Agreement who shall
receive any benefits payable hereunder in the event of
the Participant's death. In the event that the Participant
names two or more Beneficiaries, each Beneficiary shall
be entitled to equal shares of the benefits payable at the
Participant's death, unless otherwise provided in the
Participant's Joinder Agreement. If no beneficiary is
designated in the Joinder Agreement, if the Designated
Beneficiary predeceases the Participant, or if the desig-
nated Beneficiary does not survive the Participant for a
period of fifteen (15) days, then the estate of the Par-
ticipant shall be the Beneficiary.
2.OS Deferred Compensation: The amount of Nor-
mal Compensation.otherwise.payable to the Participant
which the Participant and the Employer mutually agree
to defer hereunder, any amount credited to a
Participant's Account by reason of a transfer under
section 6.09, or any other amount which the Employer
agrees to credit to a Participant's Account.
2.06 Employee: Any individual who provides services
for the Employer, whether as an employee of the
Employer or as an independent contractor, and who has
been designated by the Employer as eligible to partici-
pate in the Plan.
2.07.Includible. Compensation: The amount of an
Employee's compensation from the Employer for a
taxable year that is attributable to services performed for
the Employer and that is includible in the Employee's
gross income for the taxable year for federal income tax
purposes; such term does not.include any amount
excludable from gross income under this Plan or any
other plan described in Section 457(b) of the Code or
any other amount excludable from gross income for
federal income tax purposes. Includible Compensation
shall be, determined without regard to any community
property laws.
2.08 Joinder Agreement: An agreement entered into
between an Employee and the Employer, including any
amendments or modifications thereof. Such agreement
shall fix the amount of Deferred Compensation, specify
a preference among the investment alternatives desig-
nated by the Employer. designate the Employee's
Beneficiary or Beneficiaries, and incorporate the terms,
conditions, and provisions of the Plan by reference.
ICMA- Retirement Corporation - Appendix A Page 1
ICMA RETIREMENT CORPORATION
2.09 Normal Compensation: The amount of com --
pensation which would be payable to a Participant by
the Employer for a taxable year if no joinder Agreement
were in -ciTect to defer compensation under this Plan.
2.10 Normal Retirement Age: Age 70 -1/2, unless the
Participant has elected an alternate Wratal Retirement Age
by written instrument delivered to the Administrator prior
to Separation from Service. A Participant's Normal Retire-
ment Age determines the period during which a Participant
may utilize the catch -up limitation of Section 5.02 hereun-
der. Once a Participant his to any extent utilized the catch-
up limitation of Section 5.02, his Normal Retirement Age
may not be changed.
A Participant's-alternate Normal Retirement Age may
not be earlier than the earliest date that the Participant
will become eligible to retire and receive unreduced
retirement benefits under the Employer's basic retire-
ment plan covering the Participant and may not be later
than the date the Participant will attain age 70 -1/2. If a
Participant continues employment after attaining age
70-1/2, not having previously elected alternate Normal
Retirement Age, the Participant's alternate Normal
Retirement Age shall not be later than the mandatory
retirement age, if any, established by the Employer, or
the'age at whicli'the'Participant actually separates. from
service if the Employer has no mandatory retirement
age: If the Participant will not become eligible to
receive benefits under a basic retiremetit plan main-
tained by. the Employer, the Participant's alternate
Normal Retirement Age may not be earlier than age 55
and may not be later than age 70 -1/2.
2.11 Participant: Any Employee who has joined the
Plan pursuant to the requirements of Article IV
2.12 Plan Year: The calendar year.
2.13 Retirement: The first date upon which both of the
following shall have occurred with respect to a participant:
Separation from Service and attainment of age 65..
2.14 Separation 1rom Service: Severance of the
Participant's employment with the Employer which
constitutes a "separation from service" within the
meaning of Section 402(d)(4)(A)(iii) of the Code. In
general, a Participant shall be deemed to have severed
his employment with the Employer for purposes of this
Plan when, in accordance with the established practices of
the Employer, the employment relationship is considered
to have actually terminated. In the case of a Participant.
who is an independent contractor of the Employer,
Separation from Service shall be deemed to have oc-
curred when the Participant's contract under which
services are performed has completely expired and
terminated, there is no .foreseeable possibility that the
Employer will renew the contract or enter into a new
contract for the Participant's services, and is not antici-
pated that the Participant will become an Employee of
the Employer.
2.15 Trust: The Trust created under Article VI of the.
Plan which shall consist of all compensation deferred
under the Plan, plus any income and gains thereon, less
any losses, expenses and distributions to Participants. and
Beneficiaries.
Article 111. Administration
3.01 Duties of the Employer: The Employer shall
have the authority to make all discretionary decisions
affecting the rights or benefits of Participants which may
be required in the administration of this Plan. The
Employer's decisions shall be afforded the maximum -
deference permitted by applicable law.
3.02 Duties of Administrator:.The Administrator, as
agent for the Employer, shall perform nondiscretionary
administrative functions in connection with the Plan,
including the maintenance of Participants' Accounts,
the provision of periodic reports of the status of each
Account, and the disbursement of benefits on behalf
of the Employer in accordance with the provisions of
this Plan.
Article IV. Participation in the Plan
4.01 Initial Participation: An Employee may become
a Participant by entering into a joinder Agreement prior
to the beginning of the calendar month in which the
joinder Agreement is to. become effective to defer
compensation not yet earned.
4.02 Amendment of joinder Agreement: A Partici-
pant may amend an executed joinder Agreement to
change the amount of compensation not yet earned
which is to be deferred (including the reduction of such
future deferrals to zero) or to change his investment
preference (subject to such restrictions as may result
from the nature of terms of any investment made by the
Employer). Such amendment shall become effective as
............................................................................... ...............................
Two
ICMA- Retirement Corporation - Appendix A Page 2
457 Plan Adoption Packate Retain Document
Deferred Compearatloa Plan Document and Trust, November 1996
of the beginning of the calendar month commencing
after the date the amendment is executed. A Participant
may at any time amend his Joinder Agreement to
change the designated Beneficiary, -and such amendment
shall become effective immediately,.
Article V. Limitations on Deferrals
5.01 Normal Limitation: Except as provided in section
5.02, the maximum amount of Deferred Compensation for
any Participant for any taxable year shall not exceed the
lesser of $7,500.00, as adjusted for the cost- o"ving in
accordance with Code section 457(e)(15) for taxable yeah
beginning after December 31, 1996 (the "dollar fmita-
tion"), or 33-1/3 percent of the. Participant's Includible
Compensation for the taxable year. This-limitation will
ordinarily be equivalent to the lesser of the dollar limitation
in effect for the taxable year or 25 percent of the
Participant's Normal Compensation.
5.02 Catch -Up Limitation: For each of the last three
(3) taxable years of a Participant ending before his
attainment of Normal Retirement Age, the maximum
amountof Deferred. Compensation shall be the lesser of:
(1) $15.000 or (2) the sum of (i). the -Normal Limitation
for the. taxable ,year. and: (ii) -the Normal Limitation for
each prior taxable.year of the. Participant.commencing
after 19781ess•the.amount.of the Participant's Deferred
Compensation tot such prior;taxable years. A prior
-taxable year shall be taken, into account under the
preceding sentence only if (i) the-Participant was c&-
gible to participate in the Plan for. such year (or in any
other eligible deferred compensadoti plan established
under Section 457 of the Code which is properly taken
into account pursuant to- regulations under section 457).
and (ii) compensation (if any) deferred: under the Plan
(or such other plan) was subject to the deferral limita-
tions set forth in Section 5.01
5.03 Other Plans: The'amount excludable from a
Participant's gross income under this Plan or any other
eligible deferred compensation plan under section 457
-of the Code shall not exceed.$7.500.00 (or such greater
amount allowed under Sections 5.01 or 5.02 of the
Plan), less any amount excluded from gross income
under section 403(6). 402(a)(8), or 402(h)(1)(B) of the
Code, or any amount with respect to which a deduction
is allowable by reason of a contribution to an organiza-
tion described in section 501(c)(18) of the Code.
Article VI. Trust and Investment
of Accounts
6.01 Investment of Deferred Compensation: A
Trust is hereby created to hold all the assets of the Plan
for the exclusive benefit of Participants and Beneficia-
ries, except that expenses and taxes may be paid from
the Trust as provided in Section 6.03. The trustee shall
be the Employer or such other person which agrees to
act in that capacity hereunder.
6.02. Investment Powers: The trustee or the Plan
Administrator, acting as agent for the trustee; shall have
the powers listed in-this Section with respect to invest-
ment of Trust assets, except to the extent that the
investment of Trust assets is directed by Participants,
pursuant to Section 6.05.
(a) To invest.and reinvest. the Trust without
distinction between principal and income in any
form of tangible or intangible property, real, Per-
sonal, or mixed, and wherever situated, including,
but not by way of limitation, common or preferred
stocks, shares of regulated investment companies and
other mutual funds, bonds, loans, notes, debentures,
mortgages, certificates of deposit, interest, or par-
ticipation. equipment trust certificates, commercial
paper including but not limited to participation in
pooled commercial paper accounts, contracts with
insurance companies including but not limited to
insurance, individual .or group annuity, deposit
administradon, and.guaranteed interest contracts,
deposits at reasonable rates of interest at banking
institutions including but not limited to savings
accounts and certificates of deposit, and other forms
of securities or investments of any kind, class, or
character whatsoever and'representing interests in
any form of enterprise. wherever it may be located,
organized or operated within or without the United
States of America, whether such investments are
income producing or not, without being limited in
any respect by statute or court rule or decision of
any jurisdiction now or hereafter in force purporting
to limit or otherwise affect such investments. Assets
.of the Trust may be invested in securities or new
ventures that involve a higher degree of risk than
investments that have demonstrated their investment
performance over an extended period of time.
......... .................................:.................................... ...............................
Three
1CMA- Retirement Corporation - Appendix A Page 3
ICMA RETIREMENT CORPORATION
(b) To invest and reinvest all or any part of the
assets of the Trust in any. common. 'collective or
commingled trust fund that is maintained by a bank
or other institution and that is available to Em-
ployee plans described'under sections 457 or 401 of
the Code, or any successor provisions thereto, and
during the period of time that an investment
through any such medium shall exist, to the extent
of participation of the Plan, the declaration of trust
of such common, collective, or commingled trust
fund shall constitute a part of this Plan.
(c) To invest and reinvest all or any part of the
assets of the Trust in any group annuity, deposit
administration or guaranteed interest contract issued
by an insurance company or other financial institu-
tion on a commingled or collective basis with the
assets of any other 457 plan or trust qualified under
section 401(a) of the Code or any other plan de-
scribed in section 401(a)(24) of the Code, and such
contract may. be held or issued in the name of the
Plan Administrator, or such custodian as the Plan
Administrator may appoint, as'agent and nominee
for the Employer.. During the period that an invest-
ment through any such contract shall exist, to the
extent of participation.of the Plan.-the terms 'and
conditions of such contract shall constitute a part of
the Plan..
(d) To purchase part interests in real property or in
mortgages on real property. wherever such real
property may be situated, and to delegate to a .
propertymanager or the holder or holden of a
majority interest in such real property or-mortgage.
on real property the management and operation of
any part interest in such real property or mortgages.
(e) To hold cash awaiting investment and to keep
such portion of the Trust in cash or cash balances,
without liability for interest, in such amounts as may
from time to time be deemed to be reasonable and
necessary to meet obligations under the Plan or
otherwise to be in the best interests of the Plan.
(f) .To retain, manage, operate, administer, divide,
subdivide, partition, mortgage, pledge, improve,
alter, demolish, remodel, repair, and develop in any
manner any property, or any part of or partial
interest in any property, real or personal, held in the
Trust; to lease such property for any period of time,
and to grant options to sell, exchange, lease, or
otherwise dispose of any such property, without
regard to restrictions applicable to fiduciaries or
others and without the approval of any court.
(g) To sell for cash or credit, redeem, exchange for
other property, convey, transfer, or otherwise
dispose of any property held in the Trust in any
manner and at any time, by private contract or at
public auction or otherwise, and no other person
shall be. bound to see to the application of the
purchase money or to inquire into the validity.
expediency, or propriety of any such sale or other
disposition.
(h) To enter into contracts for or to make commit-
ments either alone or in company with others to
purchase or sell at any future date any property
acquired for the Trust.
(i) To vote or to refrain from voting any stocks,
bonds, or other securities held in the Trust, to
exercise any other right appurtenant to any securi-
ties or other property held in the Trust, to give
general or special proxies or powers of attorney with
or without power of substitution with respect to
such'=ecurities and other property, to exercise any .
conversion privileges. subscription rights, or other
options or privileges with respect to such securities
and other property and make any payments inciden-
tal thereto, and generally to exercise, personally or
by general or limited power of attorney, any of the
powers of an owner with respect to stocks, bonds,
securities, or other property held in the Trust at
any time.
(j) To oppose or to consent to and participate in
any organization, reorganization, consolidation,
merger, combination, readjustment of finances, or
similar. arrangement with respect to any corporation,
company, or association, any of the securities of
which are held in the Trust, to do any act with
reference thereto, including the exercise of options,
the'making of agreements or subscriptions and the
payment of expenses, assessments, or subscriptions
that may be deemed necessary or advisable in
connection therewith, and to accept, hold, and
retain any securities or other property that may be
so acquired.
............................................................................... ...............................
. Four
ICMA- Retirement Corporation - Appendix A Page 4
457 Plwn Adopiion Package Regain Decnecni
Deferred Compensation. Plan Documen.r and Trnrc. November 1996
(k) To deposit any property held in the Trust with
any protective, reorganization, or similar commit-
tee, and to delegate discretionary power thereto and
to pay and agree to pay part'of-its expetses and
compensation and any assessments levied with
respect to any such property so deposited.
(1) To hold, to authorize the holding. of, and to
register any investment to the Trust in the name of
the Plan, the Employer, or any nominee or agent of
any of the foregoing, including the Plan Administra-
tor. or in bearer form, to deposit or arrange for the
deposit of securities in a qualified central depository
even though, when so deposited, such securities may
be merged and held in bulk in the.name of the
nominee of such depository with other securities
deposited therein by any other person, and to
organize corporations or trusts under the laws of any
jurisdiction for the purpose of acquiring or holding
title to any property for the Trust, all with or
without the addition of words or other action to
indicate that property is held in a fiduciary or
representative capacity but the books and records of
the Plan shall at all times show that all such invest-
ments are part of the Trust.
(m) Upon such terms as.tnay be deemed advisable
by the Employer or the Plan,Admiitistrator, as the
case may be, for the protection of the interests of
the Plan or for the preservation of the value of an
investment, to exercise and enforce by suit for legal
or equitable remedies or by other action, or to
waive any right or claim on.behalf of the Plan or
any default in any obligation owing to the Plan, to
renew, extend the time for payment of, agree tot
reduction in the rate of interest on, or agree to any
other modification or change in the terms of any
obligation owing to the Plan, to settle, compromise,
adjust, or submit to arbitration any claim or right in
favor of or against the Plan. to exercise and enforce
any and all rights of foreclosure, bid for property in
foreclosure, and take a deed in lieu of foreclosure
with or without paying consideration therefor, to
commence or defend suits or other legal proceedings
whenever any interest of the Plan requires it, and to
represent the Plan in all suits or legal proceedings in
any court of law or equity or before any body or
tribunal.
(n) To employ suitable consultants, depositories,
agents, and legal counsel on behalf of the Plan.
(o) To make, execute. acknowledge, and .deliver
any and all deeds, leases, mortgages, conveyances,
contracts, waivers, releases, or other instruments in
writing necessary or proper for the accomplishment
of any of the foregoing powers.
(p) To open and maintain any bank account or
accounts in the name of the Plan. the Employer, or
any nominee or agent of the foregoing, including
the Plan Administrator, in any bank or banks.
(q) To do any and all other acts that may be
deemed necessary to carry out any of the powers set
forth herein.
6.03 Taxes and Expenses: All taxes of any and all
kinds whatsoever.that may be levied or assessed under
existing or future laws upon, or in respect to the Trust,
or the income thereo& and all commissions or acquisi-
tions or dispositions of securities and similar expenses of
investment and reinvestment of the Trust, shall be paid.
from the Trust. Such reasonable compensation of the
Plan Administrator, as may be agreed upon from time to
time by the Employer and the Plan Administrator, and
reimbursement for reasonable expenses incurred by the
Plan Administrator in performance of its duties hereun-
der (including but not limited to fees for legal, account-
ing, investment and custodial services) shall also be paid
from the Trust. .
6.04 Payment of Benefits: The payment of benefits
from the Trust in accordance with the terms of the Plan
may be made by the Plan Administrator. or by any
custodian or other person so authorized by the Em=
ployer to make such disbursement. The Plan Adminis-
trator, custodian or other person shall not be liable with
respect to any distribution of Trust assets'made at the
direction of the Employer.
6.05 Investment Funds: In accordance with uniform .
and nondiscriminatory rules established by the Employer
and the Plan Administrator, the Participant may direct
his /her Accounts to be invested in one (1) or more
investment funds available under the Plan; provided.
however, that the Participant's investment directions
shall not violate any investment restrictions established
by the Employer. Neither the Employer. the Adminis-
trator, nor any other person shall be liable for any losses
incurred by virtue of following such directions or with
any reasonable administrative delay in implementing
such directions.
.............................................................................. ...............................
Five
ICNIA- Retirement Corporation - Appendix A Page 5
ICMA RETIREMENT CORPORATION
6:06 Valuation of Accounts: As of rach Accounting
Date, the Plan *.assets held in each investment fund
offered shall be valued at fair market value and the
investment income and gains or losses for each fund
shall be determined. Such investment income and gains
or losses shall be allocated proportionately among all
Account balances on a fund -by -fund basis. The alloca-
tion shall be in the proportion that each such Account
balance as of the immediately preceding Accounting
Date bean to the total of all such Account balances as of
that Accounting Date. For purposes of this Article. all
Account. balances include the Account balances of all
Participants and Beneficiaries.
6.07 Participant Loan Accounts: Participant Loan
Accounts shall be invested in accordance with Section
8.03 of the Plan. Such Accounts shall not share in any
investment income and gains or losses of the investment
funds described in Sections 6.05 and 6.06.
6.08 Crediting of Accounts: The Participant's Account
shall reflect the amount and value of the investments or
other property obtained by the Employer through the
investment of the Participant's Deferred Compensation
pursuant to Sections 6.05 and 6.06. It is anticipated that the
Employer's investments with respect'to a Participant will
conform to the investment preference specified in the
Participant's Joinder Agreement, but'nothing-her -em shall
be construed to require the Employer to make.any particu-
lar-investment of a Participant's Deferred Compensation.
Each Participant s�rall receive. periodic repom, not less
frequently than annTally, showing the then current
value of his /her Account.
6.09 Transfers:
(a) Incoming Transfers: A transfer may be ac-
cepted from an eligible deferred compensation plan
maintained by another employer and credited to a
Participant's Account under the Plan if (I) the
Participant has separated from service with. that
employer and become an Employee of the Em-
ployer, and (ii) the other employer's plan provides
that such transfer will be made.-The Employer may.
require such documentation from the predecessor •
plan as it deems necessary to effectuate the transfer,
to confirm that such plan is an eligible deferred
compensation plan within the meaning of Section
457 of the Code, and to assure that transfers are
provided for under such plan. The Employer may
refuse to accept a transfer in the form of assets other
than cash, unless the Employer and the Administra-
tor agree to hold such other assets under the Plan.
Any such transferred amount shall be treated as a
deferral subject to the limitations of Article V.
except that, for purposes of applying the limitations
of Sections 5.01 and 5,02; an-amount deferred
during any taxable year under the plan from which .
the transfer is accepted shall be treated as if it has
been deferred under this Plan during such taxable
year and compensation paid by the transferor em-
ployer shall be treated as -if it had been paid by the
Employer.
(b) Outgoing Transfers: Air mount may be
transferred to an eligible deferred compensation plan
maintained by another employer, and charged to a
Participant's Account under this Plan, if (I) the
Participant has separated from service with the
Employer and become an employee of the other
employer, (ii) the other employer's plan provides
that such transfer will be accepted, and (iii) the<
Participant and the employers.have signed such
agreements as are' necessary to assure that the
Employer's liability to pay benefits to the Partici-
pant has been discharged and assumed by the other
employer. The Employer may require such docu-
mentation from the other plan as it deems necessary
to effectuate the transfer,.to confirm that such plan
is an eligible'deferred.compensation plan within the
meaning of section 457 of the Code, arid to assure
that transfer are provided for under such plan. Such
transfers shalt be made only under such circum-
stances as'are permitted under, section 457 of the
Code and the regulations- thereunder.
6.10 Employer Liability: In no event shall the
Employer's liability to pay benefits to a Participant
under this Plan exceed the value of the amounts cred-
ited to the Participant's Account; neither the Employer
nor the Administrator shall be liable for losses arising
from depreciation or shrinkage in the value of any
investments acquired under this Plan.
.............................................. ............................... ...............................
Six
ICMA- Retirement Corporation - Appendix A Page 6
ISM Plan Adoption Ptcktae Rettln Document
Deferred Compcasttioa Plan Document tad Trust. November 1996
Article VII. Benefits .
7.01 Retirement Benefits and Election on Separa-
tion from Service: Except as otherwise provided in
this Article VII, the distribution of a Participant's
Account shall commence as of April 1 of the calendar
year after the Plan Year of the Participant's Retirement,
and the distribution.of such Retirement benefits shall be
made in accordance with one of the payment options
described in Section 7.02. Notwithstanding the forego-
ing, but subject to the following paragraph of this
Section 7.01, the Participant may irrevocably elect
within 60 days following Separation from Service to
have the distribution of benefits commence on a fixed
determinable date other than that described in the
preceding sentence which is at least 61 days after Separa-
tion from Service, but not later than April 1 of the year
following the year of the Participant's Retirement or
attainment of age 70 -1/2, whichever is later. Notwith-
standing the .foregoing provisions of this Section 7.01, no
election to defer the commencement of benefits after a
separation from service shall operate to defer the distnbu-
tion of any amount in the Participant's. Loan Account in
the event of a default of the Participant's loan:
Effective on or after January 1, 1997, the Participant
may elect to defer the commencement of distribution of
benefits to a fixed determinable date later than the date
described above, but not later thaw April 1 of-the year
following the year of the Participant's retirement or
attainment of age 70 -1/2, whichever is later, provided
(a) such election is made after.the 61st day following
Separation from Service and before commencement of
distributions and (b) the Participant may make only one
(1) such election. Notwithstanding the foregoing; the
Administrator, in order to ensure the orderly adminis-
tration of this provision, may establish a deadline after
which such election to defer the commencement of
distribution of benefits shall not be allowed.
7.02 Payment Options: As provided in Sections 7.01,
7.04 and 7.05, a Participant or Beneficiary may elect to
have value of the Participant's Account distributed in
accordance with one of the following payment options,
provided that such option is consistent with the limita-
tions set forth in Section 7.03.
(b) One lump -sum payment;
(c) Approximately equal monthly, quarterly, semi-
annual or annual payments, calculated to continue
for a period certain chosen by the Participant.
(d) Annual Payments equal to the minimum distri-
butions required under Section 401(a)(9) of the
Code over the life expectancy of the Participant or
over the life expectancies of the Participant and his
Beneficiary.
(e) Payments equal to payments made by the issuer
of a retirement annuity policy acquired by the
Employer.
(1) A split distribution under which payments under
options (a), (b), (c) or (e) commence or are made at
the same time, as elected by the Participant under
Section 7.01, provided that all payments commence
(or are made) by the latest benefit commencement
date under Section 7.01 and that once a payment is
made subsequent payments will be made in substan-
tially nonincreasing amounts.
(g) Any payment option elected by the Participant
and agreed to, by the Employer and Administrator,
provided that such option must provide for substan-
tially nonincreasing payments for any period after
the benefit commencement date under Section 7.01.
A Participant's or Beneficiary's selection of a payment
option made after December 31, 1995, under Subsec- .
dons (a), (c), or (g) above may include the selection of
an automatic annual cost -of- living increase. Such
increase will be based on the rise in the Consumer Price
Index for All Urban- Consumers (CPI -U) from the third
quarter of the list year in which a cost -of -living in-
crease was provided to the third quarter of the current
year. Any increase will be made in periodic payment
checks beginning the following January. The first cost -
of- living increase will be based on the rise in the CPI -U
from the third quarter of 1995 to the third quarter of
1996, and will be applied to amounts paid beginning
January 1997.
A Participant's or Beneficiary's election of a payment
(a) Equal monthly, quarterly, semi - annual or annual option must be made at least 30 days before the pay -
payments in an amount chosen by the Participant, ment of benefits is to commence. If a Participant or
continuing until his /her Account is exhausted; Beneficiary fails to make a timely election of a payment
option, benefits shall be paid monthly under option (c)
............................................................................. ...............................
Seven
ICMA- Retirement Corporation - Appendix A Page 7
ICMA RETIREMENT CORPORATION
above for a period of five years or such shorter period of
time necessary to ensure that the amount of any install-
ment is not less than $1,200 per. year, without the
inclusion of a cost -of- living increase.
7.03 Limitation on Options: No payment option may
be. selected by a Participant under subsections 7.02(a) or
(c) unless the amount of any installment is not less than
$1,200 per year. No payment option may be selected
by a Participant or Beneficiary under Sections 7.02,
7:04, or 7.05 unless it satisfies the requirements of
Sections 401(a)(9) and 457(d)(2) of the Code, including
that payments commetcing before the death of the
Participant shall satisfy the incidental death betieftts.
requirement under section 457(d)(2)(B)(i)(1). ' A cost -of-
living increase included as part of a payment option
selected under Section 7.02 shall not be considered to
fail to satisfy the requirement under section 457(d)(2)(b)
that any distribution made over a period of more than 1
year can only be made in substantially nonincreasing
amounts. Unless otherwise elected by the Participant
(or spouse, in the case of distributions described in
Section.7.05 below) by the tithe distributions are :
required to begin, life expectancies shall be recalculated
annually. Such elecdon shall be irrevocable as to the
Participant (or spouse) and shall .apply to all subsequent
years. The life expectancy of a nonspouse Beneficiary
may not be recalculated.
7.04 Post- retirement Death Benefits:
(a) Should the Participant die after he /she has
begun to receive benefits under a payment option,
the remaining payments, if any, under the payment
option shall be payable to the Participant's Benefi-
ciary within the 30-day period commencing with
the 61st day after the Participant's death, unless the
Beneficiary elects payment under a different pay-
ment option that is available under Section 7.02
within 60 days of the Participant's death. Any
different payment option elected by a Beneficiary
under this section must provide for payments at a
rate that is at least as rapid under the payment
option that was applicable to the Participant. In no
event shall -the Employer or Administrator be liable
to the Beneficiary for the amount of any payment
made in the name of the Participant before
the Administrator receives proof of death of the
Participant.
(b) If the designated Beneficiary does not continue
to live for the remaining period of payments under
the payment option, then the commuted value of
any remaining payments under the payment option
shall be paid in a lump sum to the estate of the
Beneficiary. In the event that the Participant's estate
is the Beneficiary, the commuted value of any
remaining payments under the payment option shall
be paid to the estate in a lump sum.
7.05 Pre - retirement Death Benefits:
(a) Should the Participant die before he has begun
to receive the benefits provided by Section 7.01, the
value of the Participant's Account shall be payable
to the Beneficiary commencing within the 30-day
period commencing on the 91st day after the
Participant's death, unless the Beneficiary elects a...`
different fixed or- determinable benefit commence-
ment date within 90 days of the Participant's death.
Such benefit commencement .date shall be not later
than the later of (I) December 31 of the year fol-
lowing the year of the Participant's death, or (ii) if
the Beneficiary is the Participant's spouse, Decem-
ber 31 of the year in which the Participant would
have attained ag e-70-1/2.
(b) Unless a Beneficiary elects a different payment
option prior to the •benefit commencement date,
death. benefits under this. Section shall be paid in
approximately. equal annual installments over five
years, or over such shorter period as may be neces-
sary to assure that the amount of any annual install-
ment is not less than $3,500. A Beneficiary shall be
treated as if he /she .were a Participant for purposes
of determining the payment options available under
Section 7.02, provided, however, that-the payment
option chosen by the Beneficiary must provide for
payments to the Beneficiary over a period no longer
than the life expectancy of the Beneficiary, and
provided that such period ;may not exceed (15) years
if the Beneficiary is not the Participant's spouse.
(c) In the event that the Beneficiary dies before the
payment of death benefits has commenced or been
completed, the remaining value of the Participant's
Account shall be paid to the estate of the Benefi-
ciary in a lump sum. In the event that the
Participant's estate is the Beneficiary, payment shall
be made to the estate in a lump sum.
.............................................................................. ...............................
Eight
ICMA- Retirement Corporation - Appendix A Page 8
4S7 Plan Adoption Package Retain Document
Deferred Compensation Plan Document and Trust, November 1996
7.06 Unforeseeable Emergencies:
(a) In the event an unforeseeable emergency' occurs.
a Participant may apply to the Employer to receive
that part, of the value of his /her Account that is
reasonably needed to satisfy the emergency need. If
such an application is approved by the Employer.
the Participant shall be paid only such amount at the
Employer deems necessary to meet the emergency
need, but payment shall not be made to the extent
that the financial hardship may be relieved through
cessation of deferral under the Plan, insurance or
other reimbursement, or liquidation of other assets
to the extent such liquidation would not itself cause
severe financial hardship.
(b) An unforeseeable emergency shall be deemed to
involve only circumstances of severe financial
hardship to the Participant resulting from a sudden
unexpected illness, accident, or disability iof the
Participant or of a dependent (as defined in section
152(a) of*the Code). of the Participant, loss of the
Participant's property due to casualty, or other
similar and extraordinary unforeseeable circum-
stances arising as a result of events beyond the
control of the Participant. The need to send a
Participant's child to college or to purchase a new
home shall not be considered unforeseeable. emer-
gencies. The determination as to whether such an
unforeseeable emergency exists -shall be based on the
merits of each individual case.
7.07 Transitional Rule for Pre -1989 Benefit Elec-
tions: In the event that, prior to January 1, 1989, a
Participant or Beneficiary has commenced receiving
benefits under a payment option or has irrevocably elected
a payment option or benefit commencement date, then that
payment option or election shall retrain in effect notwith-
standing any other provision of the Plan.
7.08 De Minimis Accounts: Notwithstanding the
foregoing provisions of this Article, if the value of a
Participant's Account does- not exceed $3,500 and (a) no
amount has been deferred under the Plan with respect
to the Participant during the .2 -year period ending on
the date. of the distribution and (b) there has been no
prior distribution under the Plan to the Participant
pursuant to this Section 7.08, the Participant may elect
to receive or the Employer may distribute the Participant's
entire Account without the consent of the Participant.
Such distribution shall be made in a lump sum.
Article VIII. Loans to Participants
8.01 Availability of Loans to Participants:
(a) Effective January 1. 1997, the Employer• may
elect to make loans available to Participants in this
Plan. If the Employer has elected to make loans
available to Participants, a Participant may apply for
a loan from the,Plan subject to the limitations and
other provisions of this Article.
(b) The Employer shall establish written guidelines
governing the granting of loans, provided that such
guidelines are approved by the Plan Administrator
and are not inconsistent with the provisions of this
Article. and that loans are made available to all
Participants on a'reasonably equivalent basis.
8.02 Terns and Conditions of Loans to Participants:
Any loan by the Plan to a Participant under Section 8.01, of the
Plan shall satisfy the following requirements:
(a) Availability. Loans shall be made.available to
all Participants on a reasonably equivalent basis.
(b) Interest Rate. Loans must be adequately .
secured and bear a reasonable interest rate.
(c) Loan Limit. No Participant loan shall exceed
the present value of the Participant's Account.
(d) Foreclosure. In the event of default on any
installment payment, the outstanding balance of the
loan shall be a deemed distribution. In such event,
an actual distribution of a plan loan offset amount
will not occur until a distributable event occurs in
the Plan.
(e) Reduction of Account. Notwithstanding any
other provision of this Plan, the portion of the
Participant's Account balance used as a security
interest held by the Plan by mason of a loan out-
standing-to the Participant shall be taken into
account for purposes of determining the amount of
the Account balance payable at the time of death or
distribution, but only if the reduction is used as
repayment of the loan.
................................................................................ ...............................
Nine
ICMA- Retirement Corporation - Appendix A Page 9
ICMA RETIREMENT CORPORATION
(f) Amount of Loan. At the time the loan. is made,
the principal amount of the loan plus the outstanding
balance (principal plus accrued interest) due on any .
other outstanding.loans to the Participant from the Plan
and from ill other plats of the Employer that are
qualified :employer plans under section 72(p)(4) of the
Code shall not exceed the least of
(1) $50.000, reduced by'the excess (if any) of
(a) The highest outstanding balance of loans
from the Plan during the one (1) year
period ending on the day before the date
on which the loan is made, over
(b) The outstanding balance of loans from the
Plan on the date on which such loan is
made; or
(2) One -half of the value of the Participant's
interest in all of his /her Accounts under,
this Plan.
(g) Application for Loin. The Participant must
give the Employer adequate written notice, as
determined by the.Employer, of the amount and
desired time for receiving a loan. No more than
one (1) loan may be made by the Plan to a Partici-
pant in any calendar year.. No loan shall be ap-
proved if an existing loan. from the. Plan.to the
Participant is in default to any extent.
.(h) Length -of Loan. -Any loan issued shall require
the Participant to repay the loan in substantially
equ4 installments of principal and interest, at least
monthly, over.a period that. does not exceed five (5)
years from the date of the loan; provided, however,
that if the proceeds of the loan are applied by the
Participant to acquire any. dwelling unit that is to be
used within a reasonable time ( determined at the
time. the. loan is made) after the loan is made as the
principal residence of the Participant, the five (5)
year limit shall not apply. In this event, the .period
of repayment shall not exceed a reasonable period
determined by the Employer. Principal installments
and interest payments otherwise due may be sus-
pended for up to one (1) year during an authorized
leave of absence, if the promissory note so provides,
but not beyond the original term permitted under
this Subsection (h), with a revised payment schedule
(within such term) instituted at the end of such
period of suspension.
(i) Prepayment. The Participant shall be permitted
to repay the loan. in whole or in part at any time
prior to maturity; without penalty.
(j) Promissory. Note. The loan shall be evidenced
by a promissory note executed by the Participant
and delivered to the Employer, and shall bear
interest at a reasonable rate determined by the
Employer.
(k) Security. The loan shall be secured by an
assignment of the Participant's right, title and
interest in and to his /her Account.
(1) Assignment or Pledge. For the purposes of
paragraphs (E) and (g), assignment or pledge of any
portion of the Participant's interest in the Plan and a
loan, pledge; or assignment with respect to any
insurance contract purchased under the Plan, will be
treated as a loan.
(m) Other Terms and Conditions. The Employer
shall fix such other terms and conditions of the loan
as it deems necessary to comply with legal require -
riients, .to maintain the .qualification of the Plan and
Trust under section 457 of the Code, or to prevent
the treatment of the loan for tax purposes as a
distribution to the Participant. The Employer, in
its discretion for any reason, may fix other terms
and conditions of the loan, not inconsistent with
the provisions of this Article and section 72(p) of
the Code.
8.03 Participant Loan Accounts:
(a) Upon approval of a loan to a Participant by the
Employer, an amount not in excess of the loan shall
be transferred from the Participant's other invest-
ment fund(s), described in Section 6.05 of the Plan,
to the Participant's Loan Account as of the Account-
ing Date immediately preceding the agreed upon
date on which the loan is to be made.
(b) The assets of a Participant's Loan Account may
be invested and reinvested only in promissory notes
received by the Plan from the Participant as consid-
eration for a loan permitted by Section 8.01 of the
Plan or in cash. Uninvested cash balances in a .
.............................................................................. ...............................
Ten
ICMA- Retirement Corporation - Appendix A Page 10
4S7 Plon Adop-tion Poekogc Reldin Document
Deferrei Compentatlon Pldn Document •nL Trutt, November 1996
Participant's Loan Account shall not bear interest.
Neither the Employer, the Administrator, nor any
other person shall be liable for any loss, or by reason
of any breach, that results from the Participant's
exercise of such control.
(c) Repayment of principal and payment of interest
shan be made by payroll deduction or, where
repayment cannot be made by payroll deduction, by
check, and shall be invested in one (1) or more
other investment funds, in accordance with Section
6.05 of the Plan, as of the next Accounting Date
after payment thereof"to the Trust. The amount so
invested shall be deducted from the Participant's
Loan Account.
(d) The Employer shall have the authority to
establish other reasonable rules, not inconsistent
with the provisions of the Plan, governing the
establishment and maintenance of Participant Loan
Accounts.
Article IX. Non - assignability
9.01 In General: Except as provided in Article VIII
and Section 9.02, no Participant or Beneficiary shall
have any right to commute, sell, assign, pledge, transfer
or otherwise convey or encumber the right to receive
any payments hereunder, which payments and rights
are expressly declared to be non - assignable and
non - transferable.
9.02 Domestic Relations Orders:
(a) Allowance' of Transfers: To the extent re-
quired under final judgement, decree, or order
(including approval of a property settlement agree-
ment) made pursuant to a state domestic relations
law, any portion of a Participant's Account may be
paid or set aside for payment to a spouse, former
spouse, or child of the Participant. Where necessary
to carry out the terms of such an order, a separate
Account-shall be established with respect to the
spouse, former spouse, or child who shall be en-
titled to make investment selections with respect
thereto in the same nnnner as the Participant; any
amount so set aside for a spouse, former spouse, or
child shall be paid out in a lump sum at the earliest
date that benefits may be paid to the Participant,
unless the order directs a different time or form of
payment. Nothing in this Section shall be construed
to authorize any amount to be distributed under the
Plan at a time or in a form that is not permitted
under Section 457 of the Code. Any Payment made
to a person other than the Participant pursuant to .
this Section shall be reduced by required income tax
withholding; the fact that payment is made to a
person other than the Participant may not prevent
such payment from being includible in the gross
income of the Participant for withholding and
income ax reporting purposes.
(b) Release from Liability to Participant: The
Employer's liability to pay benefits to a Participant
shall be reduced to the extent that amounts have
-been paid or set aside for payment to a spouse, ...
former spouse, or child pursuant to paragraph (a) of
the Section. No such transfer shall be effectuated
unless the Employer or Administrator has been
provided with satisfactory evidence that the Em-
ployer and the Administrator are released from any
further claim by the Participant with respect to such
amounts. The Participant shall be deemed to have
released the Employer and the Administrator from
any claim with respect to such amounts, in any case
in which (i) the Employer or Administrator has been
served with legal process or otherwise joined in a
proceeding relating to such transfer, (ii) the Partici-
pant has been notified of the pendency of such
proceeding in the manner prescribed by the law of
the jurisdiction in which the proceeding is pending
for service of process in such action or by mail from
the Employer or Administrator to the Participant's
last known mailing address; and (iii) the Participant
fails to obtain an order of the court in. the "proceed-
ing relieving the Employer or Administrator from
the obligation to comply with the judgment, decree,
or order.
(c) Participation in Legal Proceedings: The
Employer-and Administrator shall not be obligated
to defend against or set aside any judgement, decree,
or order described in paragraph (a) any legal order
relating to the garnishment of a Participant's ben-
efits, unless the full expense of such legal action is
borne by the Participant. In the event that the
Participant's action (or inaction) nonetheless causes
the Employer or Administrator to incur such ex-
pense, the amount of the expense may be charged
against the Participant's Account and thereby reduce
the Employer's obligation to pay benefits to the
.............................................................................. ...............................
Eleven
ICMA- Retirement Corporation - Appendix A Page 1 l
[CMA RETIREMENT CORPORATION
Participant. In the course of any proceeding relating
to divorce, separation, or child support, the Em-
ployer and Administrator shall be. authorized to
disclose information relating to the Participant's
Account to the Participant's spouse, former spouse,
or child (including the legal representatives of the
spouse, former spouse, or child).. or to a court.
Article X. Relationship to other Plans
and Employment Agreements
This Plan serves in addition to any other retirement,
pension, or benefit plan or system presently in existence
or hereinafter established for the benefit of the
Employer's employees, and participation hereunder shall
not affect benefits receivable under any such plan or
system. Nothing contained 'in this Plan shall be deemed
to constitute an employment contract or agreement
between any Participant and the Employer or to give
any Participant the right to be retained in the employ of
the Employer. Nor shall anything herein be construed
to modify the terms of any employment contract or
agreement between a Participant and the Employer.
Article XI. Amendment or Termination
of Plan
The Employer may at any time amend -shis Plan pro-
vided that it transmits such amendment in writing to the
Administrator at least 30 days prior to the effective date
of the amendment. The consent of the Administrator
shall not be required in order for such amendment to
become effective, but the Administrator shall be under
no obligation to continue acting as Administrator
hereunder if it disapproves of such amendment. The
Employer may at any time terminate this Plan.
The Administrator may at any time propose an amend-
ment to the Plan by an instrument in writing transmit-
ted to the Employer at least 30 days before the effective
date of the amendment. Such amendment shall become
effective unless, within such 30-day period, the Em-
ployer notifies the Administrator in writing that it
disapproves such amendment, in which case such
amendment shall not become effective. In the event
of such disapproval, the Administrator shall be under
no obligation to continue acting as Administrator
hereunder.
Except as may be required to maintain the status of the
Plan as an eligible deferred compensation plan under
section 457 of the Code or to comply with other
applicable laws, no amendment or termination of the
Plan shall divest any Participant of any rights with
respect to compensation deferred before the date of the
amendment or termination.
Article XII. Applicable Law
This Plan and Trust shall be construed under the laws of
the state where. the Employer is located and is estab-
lished with the intent that it meet the requirements of
an "eligible deferred compensation plan" under Section
457 of the Code, as amended. The provisions of this
Plan and Trust shall be interpreted wherever possible in
conformity with the requirements of that section.
Article X111. Gender and Number
The masculine pronoun, whenever used herein, shall
include the feminine pronoun, and the singular shall
include the plural, except where the context requires
otherwise.
.............................................................................. ...............................
Twelve
ICMA- Retirement Corporation - Appendix A Page 12
APPENDIX B
DECLARATION OF TRUST
OF ICMA RETIREMENT TRUST
ARTICLE I. NAME AND DEFINITIONS
Section 1.1 Name: The Name of the Trust created hereby
is the ICMA Retirement Trust.
Section 1.2 Definitions: Wherever they are used herein.
the following terms shall have the following respective
meanings:
(a) By -laws. The By -laws referred to in Section 4.1
hereof. as amended from time to time.
(b) Deferred Compensation Plan. A deterred
compensation plan established and maintained by
a Public. Employer for the purpose of providing
retirement income and other deterred benefits to its
employees in accordance with ft provision of
section 457 of the Internal Revenue Code of 1986.
as amended. .
(c) Employees. Those employees who participate in
. Qualified Plans. .
(d) Employer Trust A trust created pursuant to an
agreement between RC and a Public Employer. or
an agreement between RC and a Public mployer
for administrative services that is not a trust. in .
either case for the purpose of investing and
administering the funds selasiide by such Employer
in connection with its Deterred Compensation
agreements with its employees or in connection
with its Qualified Plan.
(e) Investment Contract. A non - negotiable contract
entered into by the Retirement Trust with a financial
institution that provides for a fixed rate of return on
investment
(f) ICMA. The International City /County Management
Association.
(g) ICMA/RC Trustees. Those Trustees elected by-
the Public Employers who. in accordance with the
provisions of Section 3.1(a) hereof. are also
members of the Board of Directors of ICMA.or RC
(or in the case of RC. former members of the RC
Board).
(h) Investment Adviser. The lnvestmentAdvis6rthat
enters into a contract with the Retirement Trust to
provide advice with respect to investment of the
Trust Property.
(1) Portfolios. The separate commingled accounts of
investment established by the Investment Adviser
to the Retirement Trust, under the supervision of
the Trustees. for the purpose of providing
investments for the Trust Property.
(j) Public Employee Trustees. Those- Trustees
electedbyfhe PubkEmployerswho.inaocordance
with the provision of Section 3.1(a) hereof. are full -
time employees of Public Employers.
(k) Public EmployerTrustees . Public Employerswho
serve as trustees of the Qualified Plans.
(1) Public Employer. A unit of state or local
government. or any agenccyy or instrumentality
thereof. that has adopted a Deterred Compensation
Plan or a Qualified Plan and has executed this
Declaration of Trust.
(m) Qualified Plan. A plan sponsored by a Public
Employer for the purpose of providing retirement
income to its employees which satisfies the
qualification requirements of Section 401 of the
Internal Revenue Code. as amended.
(n) RC. The lnternationalCity Management Association
Retirement Corporation.
(o) Retirement Trust. The Trust created by this
Declaration of Trust.
(p) Trust Property. The amounts held in the
Retirement Trust on behalf of the Public
Employers in connection with Deferred
Compensation Plans and on behalf of the Public
Employer Trustees for the exclusive benefit of
Employees pursuant • to Qualified Plans. The
Trust Property shall include any income resulting
from the investment -to the amounts so held.
(q) Trustees. The Public Employee Trustees and
ICMA /RC Trustees electedbythe Public Employers
to serve as members of the Board of Trustees of the
Retirement Trust.
ARTICLE II. CREATION AND PURPOSE OF THE TRUST;
OWNERSHIP OF TRUST PROPERTY
Section 2.1 Creation: The Retirement Trustwas created by
the execution of this Declaration of Trust by the initial
Trustees and Public Employers and is established with
respect to each participating Public Employer by adop-
tion of this Declaration of Trust.
Section 2.2 Purpose: The purpose of the Retirement Trust
is to provide for the commingled investment of funds
held by.the Public Employers in connection with their
Deterred Compensation and Qualified Plans. The
Trust Property shall be invested in the Portfolios; in
Investment Contracts. and in other investments recom-
mended by the Investment Adviser under the supervi=
sion of the Board of Trustees. No part.of the Trust
Property will be invested in securities issued by Public
Employers.
Section 2.3 Ownership of Trust Property: The Trustees
shall have legal title to the Trust Property. The Public
Emplo rs shall be the beneficial owners of the portion
of the Trust Pro
Rerty allocable to the Deterred Com-
pensation Plans. The portion of the Trust Property
allocable to the Qualified Plans shall be held for the
Public Employer Trustees for the exclusive benefit of
the Employees.
ARTICLE 111. TRUSTEES
Section3.1 Number and Qualification of Trustees: (a)The
Board of Trustees -shall consist of nine Trustees. Five
of the Trustees shall be full -time employees of a Public
Employer (the Public Employee Trustees) who are
authonzed bysuctxPubtic Employerto serve as Trustee.
The remaining tour Trustees shall consist of two per-
sons who. at the time of election to the Board of
Trustees. are members of the Board of Directors of
ICMA and two persons who. at the time of election, are
members or former members of the Board of Directors
of RC (the ICMA/RC Trustees). One of the Trustees
who is a director of ICM&-and one of the Trustees who
is a director of RC. shall. at the time of election, be full -
tune employees of Public Employers. (b) No person
may serve as a Trustee for more than two terms in any
ten -year period.
Section 3.2 Election and Term: (a) Except for the Trustees
appointed to fill vacancies pursuant to Section 3.5
hereof. the Trustees -shall be.elecled by a vote of a
majority of the voting Public Emplo yers in accordance
with the procedures set forth in the 8y -Laws. (b) At the
first election of Trustees. three Trustees shall be elected
for a term of three years. three Trustees shall be elected
for a term of two years and three Trustees shall be
elected for a term of one year. At each subsequent
election..ihree Trustees shall be elected. each to serve
for a term of three years and until his or her successor
is elected and qualified.
ICMA- Retirement Corporation - Appendix B Page 1
Section 3.3 Nominations: The Trustees who are full -time
employees of Public Employers shall serve as the
Nominating Committee forthe Public Employee Trust-
ees. The Nominating Committee shall choose candi-
dates for Public Employee Trustee in accordance with
the procedures set forth in the By -Laws.
Section 3.4 Resignation and Removal: (a) Any Trustee
may resign as Trustee (without need for prior or
the subse-
gent accounting) by an instrument in writing signed by
Trustee and delivered to the other Trustees and
such resignation shall be effective upon such defivery,
or at a later date according to the terms of the instru-
ment. Any of the Trustees may be removed for cause,
by a vote of a majority of the Public Employers. (b)
Each Public Employee Trustee shall resign his or her
position as Trustee within sixty cl Sys of the date on
which he or she ceases to be a full-time employee of a
Public Employer.
Section 3.5 Vacancies: The term of office of a Trustee shall
terminate and a vacancy shall occur in the event his or
her death, resignation, removal, adjudicated Incompe-
tence or other sncapacity.to perform the duties of the
office of a Trustee. In the case of a vacancy, the
remaining Trustees shall appoint such person as they
in their discretion shall see fit (subject to the limitations
set forth in this Section), to serve for the unexpired
portion of the term of the Trustee who has resigned or
otherwise ceased to be a Trustee. The tntment
shall be made by a written instrument s red by a
majority of the Trustees. The person appo nted must
be the same tytyppee of Trustee {i.e., Public Employee
Trustee or ICLWRC Trustee) as the person who has
ceased to be a Trustee. An appointment of a Trustee
may be made in anticipation of a vacancy to occur at a
later date by reason of retirement or resignation, pro-
vided that such appointmentshall notbecome effective
prior to such retirement or resignation. Whenever a
vacancy shall occur, until such vacancy is filed as
provided in this Section 3.5, the Trustees in office,
regardless of their number, shall have all the powers
granted to the. Trustees and shall discharge all the
duties imposed upon the Trustees by this Declaration.
A written instrument certifying the existence of a va-
cancy signed by a majority of the Trustees shall be
conclusive evidence of the existence of such vacancy.
Section 3.6 Trustees Serve in Representative Capacity:
By executing this Declaration, each Public Employer
agrees that the Public Employee Trustees elected by
the Public Employers are authorized to ad as agents
and representatives of the Public Employers odlectively.
ARTICLE IV. POWERS OF TRUSTEES
Section 4.1 General Powers: The Trustees shall have the
power to conduct the business of the Trust and to carry
on its operations. Such power shall include, but shall
not be limited to, the power to:
(a) receive the Trust Property from the Public
Employers, Public EmployerTrusteesorthe trustee
or administrator under any Employer Trust:
-(b) enter into a contract with an Investment Adviser
proving, among otherthings, forthe establishment
and operation of the Portfolios, selection of the
Investment Contracts in which the Trust Property
maybe invested, selection of the other investments
torthe Trust Propertyandthepaymentof reasonable
fees to the Investment Adviser and to any sub -
investment adviser retained by the Investment
Adviser;
(c) review annuallythe performance of the Investment
Adviser and approve annually the contract with
such Investment Adviser;
(d) invest and reinvest the Trust Property in the
Portfolios, the Investment Contracts and in any
other investment recommended by the Investment
Adviser, but not including securities issued by
Public Employers, provided that if a Public
Employer has directed that its monies be invested
In one or more specified Portfolios or in an
Investment Contract, the Trustees of the
Retirement Trust shall invest such monies in
accordance with such directions;
(e) keep such portion of the Trust Property in cash or
cash balances as the Trustees, from time to time,
may deem to be in the best interest of the
Retirement Trust created hereby without liability
for interest thereon;
(f) accept and retain for such time as they may deem
advisable any securities orother property received
or acquired by them as Trustees hereunder,
whether or not such securities or other property .
would normally be purchased as investment
hereunder,
{g) cause any securities or other property held as part
of the Trust Property to be registered in the name
of the RedrementTrustor in the nameof a nominee,
and to hold any investments in bearerform. but the
books and records of the Trustees shall at all times
show that all such investments are a part of the
Trust Property,
(h) make, execute, acknowledge, and deliver any and.
all documents of transfer and conveyance and any
and all other instruments that may be necessary or
appropriate to carry out the powers herein granted:
(1) vote upon any stock,.bonds, or other securities;
give general orspecial proxies orpowers of attorney
with or without power of substitution; exercise any
conversion privileges. subscription rights, or other
options, and make any payments incidental thereto;
oppose. or consent to, or otherwise participate in,
corporate reorganizations or to other changes
affecting corporate securities. and delegate
discretionary powers and payanyassessments or
charges in connection therewith; and generally
exercise any of the powers of an owner with
respect to stocks. bonds, securities or other
property held as part of the Trust Property;
Q) enter into contracts or arrangements for goods or
services required In connection with the operation
of the Retirement Trust, including, but not limited
to, contracts with custodians and contracts for the
provision of administrative services;
(k) borrow or raise money for the purposes of the
Retirement Trust in such amount, and upon such
terms and conditions, as the Trustees shall deem
advisable, provided that the aggregate amount of
such borrowings shall not exceed 30 °A of the
value of the Trust Property. No person lending
money to the Trustees shall be bound to see the
application of the money lent or to inquire into its
validity, expediency or propriety or any such
borrowing;
(1) incur reasonable expenses as required for the
operation of the RetirementTrust and deduct such
expenses from of the Trust Property;
(m) pay expenses properly allocable to the Trust
Property incurred in connection with the Deferred
Compensation Plans, Qualified Plans, or the
Employer Trusts and deduct such expenses from
that portion of the Trust Property to which such
expenses are properly allocable;
(n) pay out of the Trust Property all real and personal
property taxes, income taxes and other taxes of
any and all kinds which, in the opinion of the
Trustees, are properly levied, or assessed under
existing or future laws upon, or in respect of, the
Trust Property and allocate any such taxes to the
appropriate accounts:
ICMA- Retirement Corporation - Appendix B Page 2
(o) adopt, amend and repeal the By -laws, provided
that such Bp -laws are atall times consistent with the
terms of this Declaration of Trust;
(p) employ persons to make available interests in the
Retirement Trust to employers eligible to maintain
a Deferred Compensation Plan under Section 457
or a Qualified Plan under Section 401 of the Internal
Revenue Code, as amended;
(q) issue the Annual .Report of the Retirement Trust,
and the disclosure documents and other literature
used by the Retirement Trust;
(r). in addition to conducting the investment progrem
authorized in Section 4.1(d), make loans, including
the purchase of debt obligations, provided that all
such loans shall bear interest at the current market
rate;
(s) contract for, and delegate any powers granted
hereunder to, such officers, agents, employees,
auditors and attorneys as the Trustees may select,
provided that the Trustees may not delegate the
powers set forth in paragraphs (b), (c) and (o) of this
Section 4.1 and may not delegate any powers if
such delegation would violate their fiduciary duties;
(t) provide for the indemnification of the Officers and
Trustees o(- the Retirement Trust and purchase
fiduciary insurance;
(u) maintain books and records, including separate
accounts for each Public Employer, Public Employer
Trustee or Employer Trust and such additional
separate accounts as. are required. under, and
consistent with, the Deferred Compensation or
Qualified plan of each Public Employer, and
(v) do all such acts, take all such proceedings, and
exercise all such rights and privileges. although not
specif ically mentioned herein, as the Trustees may
deem necessary or appropriate to administer the
Trust Property and to carry out the purposes of the
Retirement Trust.
Section 4.2 Distribution ofTrustProperty: Distributions of
the Trust property shall be made to, or on behalf of; the
Public Employer or Public Employer Trustee, In accor-
dance with the terms of the Deferred Compensation
Plans, Qualified Plans or Employer Trusts. The Trust-
ees of the Retirement Trust shall be fully protected -in
making payments in accordance with the directions of
the Public Employers, Public Employer Trustees or
trustees or administrators of any Employer Trust with -
out ascertaining whether such payments are in cor ipfi-
ance with the provisions of the applicable Deferred
Compensation or Qualified Plan or Employer Trust.
Section 4.3 Execution of Instruments: The Trustees may
unanimously designate any one or mo(e.of the Trust-
ees to execute any instrument or document on. behalf
of all, including but not limitedto.the signing or endorse=
rnent of any check and the signing of any applications,
insurance and other contracts, and the action of such
designated Trustee or Trustees shall have the same
force and effect as if taken by all the'Trustees.
ARTICLE V. DUTY OF CARE AND LIABILITY OF
TRUSTEES
Section 5.1 Duty of .Care: In exercising the powers
hereinbef ore' granted to the Trustees, the Trustees
shall-perform all acts within their authority for the
exclusive purpose of providing benefits for the Public
Employers in connection with Deferred Compensation
Plans and Public Employer Trustees pursuant toQuali-
fied Plans, and shall perform such acts with the care.
skill, prudence and diligence in the circumstances then
prevailing that a prudent person acting in a like capacity
and familiar with such matters would use in the conduct
of an enterprise of a like character and with like aims.
Section 5.2 Liability: The Trustees shallnotbe liable for any
mistake of judgment or other action taken in good faith,
and for any action taken or omitted in reliance in good
faith upon the books of account or other records of the
Retirement Trust, upon the opinion of counsel, or upon
reports made to the Retirement Trust by any of its
o icers, employees or agents or -by the .Investment
Adviser or any sub - investment adviser, accountant,
appraiser or other expert or consultant selected with
reasonable care by the Trustees, officers or employees
of the RetirementTrust. The Trustees shall also not be
liable for any'loss sustained by the Trust Property by
reason of any investment made in good faith and in
accordance with the standard of care set forth in
Section 5.1.
Section 5.3 Bond: No Trustee shall be obligated to give any
bond or other security for the performance of any of his
or her dudes hereunder.
ARTICLE VI. ANNUAL REPORT TO SHAREHOLDERS
The Trustees shall annually submit to the Public Employers
and Public Employer Trustees a written report of the transac-
tions of the Retirement Trust, including financial statements
which shall be certified by independent public accountants
chosen by the Trustees.
ARTICLE VII. DURATION OR AMENDMENT OF
RETIREMENT TRUST
Section 7.1 Withdrawal: A Public Employer or Public Em-
ployer Trustee may, at any time, withdraw from this
Retirement Trust by delivering to the Board of Trustees
a written statement bf withdrawal. In such statement,
the Public Employer or Public Employer Trustee shall
acknowledge that the Trust Property allocable to the
Public Employer is derived from compensation de-
(erred by employees of such Public Employer pursuant
to its Deferred Compensation Plan or from contribu-
tions to the accounts of Employees pursuant to a
Qualified Plan, and shall designate the financial institu-
tion to which such property shall be transferred by the
Trustees of the Retirement Trust -or by the trustee or
administrator under an Employer Trust.
Section 72 Duration: The - Retirement Trust shall continue
until terminated by the vote of a majority of the. Public
Employers, each casting one vote. Upon termination,
all of the Trust Property shall be paid out to the Public
Employers, Public Employer Trustees or the trustees
or administrators of the Employer Thists, as appropriate.
Section 7.3 Amendment: The Retirement. Trust may be
amended by the vote of a majority of the Public Employ-
ers, each casting one vote.
Section 7.4 Procedure: A resolution to terminate or amend
the Retirement Trust or to remove a Trustee shall be
submitted to a vote of the Public Employers if: Q a
majority of the Trustees so direct.. or; (i) a petition
requesting a vote signed by not less that 25 percent of .
the Public Employers, is submitted to the Trustees.
ARTICLE Vlll. MISCELLANEOUS
Section 8.1 Governing Law: Except as otherwise required
by state or local law, this Declaration of Trust and the
Retirement Trust hereby created shall be construed
and regulated by the laws of the District of Columbia.
Section 8.2 Counterparts: This Declaration may be ex-
ecuted by the Public Employers and Trustees in two or
more counterparts. each of which shall be deemed an
original but all of which together shall constitute one
and the same instrument.
ICNIA- Retirement Corporation - Appendix B Page 3