Sec. 39-271. - Short title; effective date.

This article shall be known as the City of Wilmington Nonuniformed Employees' Retirement Act of 1990 all the terms of which are hereinafter referred to as Plan III. This Plan III shall be deemed effective as of July 1, 1990 and shall be fully implemented as of January 1, 1991.

(Code 1968, § 28A-130)

Sec. 39-272. - Prior plans.

The predecessors to this plan are the City of Wilmington Employees' Retirement Act described in article II of this chapter, all the terms of which are hereinafter referred to as "Plan I," and the City of Wilmington Nonuniformed Employees' Retirement Act of 1979 described in article III of this chapter, all the terms of which are hereinafter referred to as Plan II. Nonuniformed employees shall participate in Plan III, Plan I or Plan II, but in not more than one plan as to future service, in accordance with the provisions of sections 39-274 and 39-275.

(Code 1968, § 28A-131)

Sec. 39-273. - Definitions.

The following words, terms and phrases, when used in this article, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:

Authorized leave of absence means a period of absence from employment may be authorized in accordance with the city personnel code. The department of personnel shall notify the board of pensions of any authorized leave of absence of any participant.

Base salary means base salary as established by ordinance or employment contract and excluding all other compensation such as, for example, overtime pay, and, in any event, excluding any compensation paid with respect to employment in excess of 40 hours in any one calendar week. "Base salary" shall include contributions picked up by the city pursuant to section 414(h)(2) of the Internal Revenue Code. The base salary taken into account shall not exceed $200,000.00 adjusted for changes in the cost of living as provided in section 415(d) of the Internal Revenue Code.

Board of pensions means the board of pensions and retirement of the city.

Credited interest means interest credited on employee contributions made pursuant to subsection 39-275 at the rate of seven percent compounded each December 31, from July 1 of the calendar year in which the contribution is made to the first day of the calendar month of termination of active employment.

Final average base salary means the average of the participant's annual base salary for those 60 consecutive months of his last 120 months of employment with the city that produce the highest average.

Nonuniformed employee means any employee of the city who is paid a regular salary or wages, except an employee who participates in any other pension plan maintained by the city, but including any such employee of the city who through previous employment as a member of the police department or the fire department is an eligible participant in any pension plan in article V of this chapter.

Participant means a nonuniformed employee who participates in Plan III in accordance with sections 39-274 and 39-275.

Plan I and Plan II means the provisions of the City of Wilmington Employees' Retirement Act, article II of this chapter, and the provisions of the City of Wilmington Nonuniformed Employees' Retirement Act of 1979, article III of this chapter, respectively.

Plan III means the provisions of the City of Wilmington Employees' Retirement Act of 1990, being this article.

Retirement date means the date on which a participant retires under this Plan III and begins to receive retirement benefits:

(1)

Normal retirement date means the first day of the month coincident with or next following the later of a participant's 65th birthday and the completion of five years of credited service.

(2)

Early retirement date means the first day of the month coincident with or next following the later of a participant's 55th birthday and the completion of five years of credited service, as provided in section 39-279(b).

Service; years of credited service means those years of credited service which will be credited under Plan III only with respect to employment with the city as a nonuniformed employee in accordance with the rules of this definition, except as further provided in section 39-275 regarding participant contributions, and as provided below:

(1)

Prior to January 1, 1991. Whole and partial years of credited service will be credited for service prior to January 1, 1991, in accordance with the terms of the prior plan, Plan I or Plan II, in which the participant has been enrolled.

(2)

After December 31, 1990. A participant will be credited with a year of credited service with respect to service after December 31, 1990, for every employment year in which he is credited with at least 1,500 hours of service. Partial years of credited service will be credited only with respect to the last employment year during which a participant terminates employment and only if he is eligible to retire, is eligible for disability benefits, or if his spouse is eligible for survivor benefits, under this Plan III at that time.

For that year, he will be credited with a partial year of credited service equal to, but in no event more than, the fraction derived from dividing the number of customary working days in that full employment year by the number of days for which he was paid for employment in that year. See the definition of a one-year break in service below for circumstances under which service might be forfeited.

(3)

Employment year. The employment year of each participant employed on January 1, 1991, shall be the January 1 through December 31 calendar year. The employment year of any participant not employed on January 1, 1991, shall be the 12-month calendar year beginning with the date of his first employment after January 1, 1991. A participant's employment year shall remain the same unless he has a break in employment exceeding one year, in which case his employment year will thereafter be the 12-month period beginning with his first date of reemployment and anniversary dates thereof.

(4)

Hours of service. A participant, other than an elected official, will be credited with an hour of service for every hour of employment, including paid periods of absence such as vacation, holidays or sick leave, for which he is paid base salary, provided that a participant will not be credited with more than 40 hours of service with respect to any one calendar week. Paid hours will be determined from the city's payroll records. An elected official will be credited with 40 hours of service for every week during which he holds his elective position. Hours of service will be credited with respect to time served in the United States military or the national guard of the state in accordance with applicable federal and state veteran's reemployment laws.

(5)

One-year break in service. A participant incurs a one-year break in service for every employment year in which he is not credited with at least 500 hours of service; however, a participant will not incur a break in service with respect to any period of authorized leave of absence.

If a participant incurs a one-year break in service at a time when he is not credited with at least five years of credited service and if the number of his consecutive one-year breaks in service equals or exceeds his prior years of credited service, then all of his prior years of credited service will be forfeited. However, if a participant incurs a one-year break in service and if the number of his consecutive one-year breaks in service is less than his prior years of credited service, such a break in service will not cause him to forfeit any prior credited service. In addition, once a participant is credited with at least five years of credited service, any break in service occurring thereafter will not cause him to forfeit any prior credited service.

Termination of employment means separation from employment whether voluntary or involuntary, other than in connection with an authorized leave of absence.

(Code 1968, § 28A-132)

Cross reference— Definitions and rules of construction generally, § 1-2.

Sec. 39-274. - Eligibility and participation.

(a)

All nonuniformed employees of the city shall be eligible to participate in this Plan III, or in either prior plan, Plan I or Plan II, but in not more than one plan, in accordance with the rules of this section.

(b)

Each nonuniformed employee who is employed and eligible to participate in either prior plan, Plan I or Plan II, on December 31, 1990, shall become a participant in this Plan III, effective January 1, 1991, if he files with the board of pensions a written election to participate in this Plan III rather than in either prior plan, Plan I or Plan II. An employee shall be considered eligible to participate in either prior plan, Plan I or Plan II, on December 31, 1990 if he is a covered employee employed in covered employment, as those terms are defined in section 39-32, for Plan I, or if he is a "participant" as defined in section 39-68 for Plan II, as of that date. This election shall be effective only if made no later than December 31, 1990. Any such election shall be irrevocable. Any such nonuniformed employee who does not make a timely election shall continue to participate in the prior plan, Plan I or Plan II, in which he participated as of December 31, 1990. Any nonuniformed employee who terminated employment prior to January 1, 1991, shall not be eligible to participate in this Plan III unless he returns to the city's employ after December 31, 1990. Each participant's eligibility in this Plan III shall be conditioned upon and subject to that participant's contribution to the plan of a tax-deferred percentage of his salary through a payroll reduction.

(c)

Each nonuniformed employee who is employed on December 31, 1990, but who is not eligible to participate in either prior plan, Plan I or Plan II, shall become a participant in this plan effective January 1, 1991.

(d)

Each nonuniformed employee whose employment with the city commences on or after January 1, 1991, shall become a participant in this plan on the date of his employment.

(e)

Each nonuniformed employee who was employed as a nonuniformed employee prior to December 31, 1990 and whose employment terminated prior to that date, if he is again employed or reemployed as a nonuniformed employee of the city on or after January 1, 1991, shall automatically become a participant in this plan, as to future service, on the date of such new employment or reemployment by the city.

(f)

December 1, 2005 participation in plan III. Each nonuniformed employee who is employed full-time by the city and eligible to participate in either prior plan, plan I only or plan II only, or who is in no nonuniformed employee city pension plan, but is otherwise eligible ("eligible non-participant"), shall become a participant in this plan III, effective on January 1, 2006 in addition to his or her current participation in either plan I only or plan II only, or in addition to a city uniformed employee pension plan, if he files with the city treasurer's office a written election form to participate in plan III by December 1, 2005, rather than in either prior plan, plan I only or plan II only, and thereby authorizes prospectively the two percent employee contribution to be deducted from each paycheck beginning January 1, 2006. The city treasurer's office, on or before September 30, 2005, shall send in writing to each eligible plan I or plan II participant, or eligible non-participant, information concerning such eligible participant's or eligible non-participant's opportunity to elect to participate in plan III. The plan I or plan II eligible participant, or eligible non-participant, shall sign and return to the city treasurer's office on or before December 1, 2005, the written election form to participate in plan III effective on January 1, 2006. No extensions of time to elect to participate in plan III shall be granted.

(Code 1968, § 28A-133(a); Ord. No. 05-063(sub 1), § 1, 9-15-05)

Sec. 39-275. - Employee contributions.

(a)

Payroll reductions. Each participant in Plan III shall contribute to the plan, through payroll reductions, an amount equal to two percent of his gross salary per pay period.

(b)

Election to become participant. All nonuniformed employees of the city employed prior to January 1, 1991 shall be eligible to participate in Plan III, provided that the employee elects to become a participant as provided in subsection (a) of this section and that he contributes to the plan all necessary contributions to become a full participant in this Plan III. In order to assist all such nonuniformed employees of the city to make informed decisions regarding such election to participate, the board of pensions may provide information to each such employee setting forth such data as the board determines to be appropriate, but no information so provided by the board of pensions to any such employee shall be deemed to constitute a recommendation by the said board to any such employee to elect to participate or not to participate in Plan III.

(c)

Benefit determination. Any nonuniformed employee who is, prior to January 1, 1991, a participant in either prior plan, Plan I or Plan II, and who elects to become a participant in this Plan III as of January 1, 1991, shall receive retirement benefits pursuant to Plan III only with respect to services on or after January 1, 1991. Retirement benefits for services performed prior to January 1, 1991 shall be calculated, determined and paid in accordance with the terms and conditions of the prior plan, Plan I or Plan II, in which the nonuniformed employee had been a participant prior to his election to become a participant in Plan III based on his service as of December 31, 1990 and his salary history through his date of termination of employment. Eligibility under both of the plans in which an employee is thereby a participant shall be based on the participant's total service with the city.

(d)

Contribution for prior years of service. Alternatively, any nonuniformed employee who is, prior to January 1, 1991, a participant in either prior plan, Plan I or Plan II, and who elects to become a participant in this Plan III as of January 1, 1991, shall be eligible to become a participant in this Plan III for all his years of credited service, including those prior to January 1, 1991, if the nonuniformed employee pays into Plan III an amount constituting a buy-back contribution that is equal to that amount required on an actuarial equivalent basis, assuming retirement at age 65, of the difference between:

(1)

The benefit as of January 1, 1991 under Plan I or Plan II; and

(2)

The benefit under Plan III based on credited service to December 31, 1990;

so that there would be no additional past service cost to the city and that is based on his July 1, 1990 salary and his years of credited service as of January 1, 1991. For purposes of this section, July 1, 1990 salary means the June 30, 1990 salary of the employee plus four percent of that salary until and unless otherwise established by law. At retirement or termination of employment, a participant under this section may elect to retire under the benefits of subsection (c) of this section.

(e)

Amortization. Any nonuniformed employee with at least five years remaining until his normal retirement date, who is, prior to January 1, 1991, a participant in either prior plan, Plan I or Plan II, and who elects to become a participant in this Plan III and who chooses to exercise the option of the buy-back pursuant to this subsection, shall pay the amount of the buy-back contribution, determined in accordance with subsection (d) of this section, through payroll deduction payments of actuarially determined amounts for up to five years; provided, however, that if a participant who is so paying the buy-back contribution, terminates his employment with the city prior to completion of the payroll deduction payments during the buy-back period, he may either pay the balance of the buy-back contribution due at the time of such termination of employment or receive credit for his prior service, in proportion to that part of the total amount of the buy-back contribution that has actually been paid at that time. If a participant who is so paying the buy-back contribution dies or becomes disabled prior to completion of the payroll deduction payments during the buy-back period, the city shall waive the payment of the balance of the buy-back contribution and the full amount of the buy-back contribution shall be deemed fully paid or credited.

(f)

Administration of plan. In the administration of the provisions of this section, the amounts of all nonuniformed employee participants' contributions shall be calculated in terms of base salary prior to deductions of amounts for federal, state or local taxes. All contributions pursuant to the provisions of Plan III shall be accumulated at a rate of seven percent per year or such other rate as provided by ordinance of city council amending this section.

(g)

Provisions regarding refunds of contributions. If a participant has been a nonuniformed employee of the city for less than five continuous years at the time of termination of employment, the participant shall be eligible for a refund of the full amount of his employee contributions pursuant to subsections (a), (d) and (e) of this section, plus credited interest thereon. In addition:

(1)

If a participant has been a nonuniformed employee of the city for more than five continuous years at the time of termination of employment, the participant may elect to receive in lieu of any other benefit under Plan III a refund of the full amount of his employee contributions with credited interest. The maximum total of a participant's contributions through payroll reductions of two percent of gross salary per pay period pursuant to subsection (a) of this section and through amortization of buy-back contributions pursuant to this subsection shall not exceed 20 percent of gross salary per year, unless otherwise provided or authorized by the Internal Revenue Code or regulations promulgated pursuant thereto. If the resulting maximum buy-back contribution of 18 percent of gross salary per year results in an amortization period of more than five years, the board of pensions and retirement shall be and is hereby authorized to extend the amortization period applicable to a participant in such instance. In any instance in which an employee pays the maximum buy-back contribution pursuant to this subsection, but retires prior to being able to pay the full amount of his amortized buy-back contribution, such employee shall receive the prorated credit as determined in accordance with the provisions of this subsection.

(2)

In all instances in which a participant's contributions to the plan cease or terminate as a result of death or disability and the participant's spouse, or estate, or the disabled participant is not entitled to a pension benefit, then the participant's spouse or estate, or the disabled participant, as applicable, shall be eligible for a refund of the full amount of his contributions for prior years of service and his contributions for current years of service through payroll reductions pursuant to subsections (a), (d) and (e) of this section, plus interest of seven percent per year, or such other rate as provided by ordinance of city council amending this section.

(h)

City contributions. The city shall pick up under the provisions of section 414(h)(2) of the Internal Revenue Code, the employee contributions required by subsections (a) and (e) of this section. An employee who participates in this plan must make a contribution to the plan and shall not have the option to receive such contribution as compensation. The employee contributions, although designated as employee contributions, are being paid by the city in lieu of contributions by the employee. Further, it does not matter whether the city pays such contributions through reduction in salary, an offset against future salary increases, or a combination of both methods. The contributions so picked up shall be treated as city contributions in determining tax treatment under the Internal Revenue Code; however, the contributions so picked up shall be included in base salary for purposes of this plan. The city shall pay these employee contributions from the same source of funds that is used in paying earnings to the employee.

(Code 1968, § 28A-133(b))

Sec. 39-276. - Retirement benefits.

(a)

Normal retirement. A participant may retire at any time on or after his normal retirement date and receive a pension at the annual rate of 1¾ percent of his final average base salary multiplied by his years of credited service for up to 30 years of credited service. Any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, Local 320, or (2) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, Local 1102, who retires on or after July 1, 2004, may retire at any time on or after his normal retirement date and receive a pension at the annual rate of 1.85 percent of his final average base salary multiplied by his years of credited service for up to 30 years of credited service. Notwithstanding any provision to the contrary, effective July 1, 2008, any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, ("AFSCME") Local 320, and (2) the collective bargaining agreement of the AFSCME Local 1102 and Council 81 and (3) the collective bargaining agreement of the AFSCME Local 1102B, who retires on or after July 1, 2008, may retire at any time on or after his normal retirement date and receive a pension at the annual rate of 2.0 percent of his final average base salary multiplied by his years of credited service for up to 35 years of credited service.

(i)

The aforesaid provisions of this subsection 39-276(a) regarding any employee who retires on or after July 1, 2004 retiring after his normal retirement date and receiving a pension at the annual rate of 1.85 percent of his final average base salary multiplied by his years of credited service for up to 30 years of credited service and (ii) and, the aforesaid provisions of this subsection 39-276(a) regarding any employee who retires on or after July 1, 2008, retiring after his normal retirement date and receiving a pension at the annual rate of 2.0 percent of his final average base salary multiplied by his years of credited service for up to 35 years of credited service, shall be applicable to all city employees who are not members of any collective bargaining unit, including the mayor, the city treasurer and appointees in the executive and managerial program who are not members of a collective bargaining unit's agreement.

(b)

Early retirement. The aforesaid provisions of subsection 39-276(a) as amended, shall be applicable to all city employees who are not members of a collective bargaining unit, including the mayor, the city treasurer, and employees in positions in the executive and managerial program who are not members of a collective bargaining agreement.

(1)

With reduction. A participant may retire at any time on or after his early retirement date and receive a pension at the annual rate of 1¾ percent of his final average base salary multiplied by his years of credited service, maximum 30 years, but such benefit shall be reduced by the factor of 0.4 percent times the number of full or partial calendar months by which his benefit commencement date precedes the earlier of his normal retirement date or the date the participant would first be eligible for unreduced benefits under the Rule of 90 based on his credited service at time of retirement. Any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, Local 320, or (2) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, Local 1102, who retires on or after July 1, 2004, may retire at any time on or after his early retirement date and receive a pension at the annual rate of 1.85 percent of his final average base salary multiplied by his years of credited service, a maximum 30 years, but such benefit shall be reduced by the factor of 0.4 percent times the number of full or partial calendar months by which his benefit commencement date precedes the earlier of his normal retirement date or the date the participant would first be eligible for unreduced benefits under the rule of 85 based on his credited service at time of retirement.

Notwithstanding any provision to the contrary, effective July 1, 2008, any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, ("AFSCME") Local 320, (2) the collective bargaining agreement of the AFSCME Local 1102 and Council 81 and (3) the collective bargaining agreement of the AFSCME Local 1102B, who retires on or after July 1, 2008, may retire at any time on or after his early retirement date and receive a pension at the annual rate of 2.0 percent of his final average base salary multiplied by his years of credited service for up to 35 years of credited service with reduction, if any, in accordance with this subsection 39-276(b)(1).

(2)

Rule of 90. A participant may retire at any time on or after his early retirement date and receive a pension at the annual rate of 1¾ percent of his final average base salary multiplied by his years of credited service, a maximum of 30 years, without reduction by a factor related to the time preceding his normal retirement date, provided that the total of the participant's age, which shall not be less than 55 years, plus number of years of credited service is 90 or more.

Notwithstanding any provision to the contrary, effective July 1, 2008, any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, ("AFSCME") Local 320, (2) the collective bargaining agreement of the AFSCME Local 1102 and Council 81 and (3) the collective bargaining agreement of the AFSCME Local 1102B, who retires on or after July 1, 2008, may retire under the Rule of 90 at any time on or after his normal retirement date and receive a pension at the annual rate of 2.0 percent of his final average base salary multiplied by his years of credited service for up to 35 years of credited service.

(3)

Rule of 85. Any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, local 320, or (2) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO Local 1102, who retires on or after July 1, 2004, may retire at any time on or after his early retirement date and receive a pension at the annual rate of 1.85 percent of his final average base salary multiplied by his years of credited service, a maximum of 30 years, without reduction by a factor related to the time preceding his normal retirement date, provided that the total of the participant's age, plus number of years of credited service is 85 or more.

Notwithstanding any provision to the contrary, effective July 1, 2008, any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, Local 320, (2) the collective bargaining agreement of the AFSCME Local 1102 and Council 81 and (3) the collective bargaining agreement of the AFSCME Local 1102B, who retires on or after July 1, 2008, may retire under the Rule of 85 at any time on or after his early retirement date and receive a pension at the annual rate of 2.0 percent of his final average base salary multiplied by his years of credited service for up to 35 years of credited service.

The aforesaid provisions of this subsection 39-276(b) as amended, and effective July 1, 2008, shall be applicable to all eligible city employees who are not members of a collective bargaining unit.

(c)

Payment of benefit to a married participant; post-retirement surviving spouse's benefit. If a participant is married on his retirement date, 1/12 of his annual pension will be paid to him on the first day of each month beginning with his retirement date and continuing until and including the month in which he dies.

If he is survived by his spouse, she will receive a surviving spouse's pension equal to 50 percent of his monthly pension which will be paid to her on the first date of each month until and including the first day of the month in which she dies. This surviving spouse's pension will be paid to a spouse to whom the participant was married on his retirement date.

If the aggregate payments to the participant and surviving spouse are less than the accumulated employee contributions with credited interest to date of retirement, the balance of such contribution amount shall be paid to the beneficiary designated by the participant or surviving spouse. If there is no designated beneficiary, it shall be paid to the spouse's estate.

(d)

Payment of benefit to an unmarried participant. If a participant is not married on his retirement date, 1/12 of his annual pension will be paid to him on the first day of each month beginning with his retirement date and continuing until and including the first day of the month in which he dies. If he dies before 120 monthly payments have been made to him, these monthly payments will continue to his designated beneficiary, or the beneficiary's estate, until a total of 120 payments have been made to him and his beneficiary, or the beneficiary's estate, combined.

If the beneficiary is not a natural person, then, with the consent of the legal representative of that beneficiary, the commuted value of the remaining payments may be paid in a lump sum. If the beneficiary is a natural person and dies after the participant but before a total of 120 payments have been made, then, with the consent of the beneficiary's personal representative, the commuted value of the remaining payments may be paid to the beneficiary's estate in a lump sum.

If the participant dies before 120 payments have been made to him and if there is no beneficiary classification then in effect, or if his designated beneficiary has predeceased him, then the commuted value of the remaining payments shall be paid to the participant's estate in a form to be determined by the board of pensions after consultation with the participant's personal representative.

(Code 1968, § 28A-134; Ord. No. 04-036, § 1, 6-17-04; Ord. No. 04-045, § 1, 6-17-04; Ord. No. 04-093, § 1, 12-9-04; Ord. No. 05-068(sub 1), § 1, 9-1-05; Ord. No. 08-087, § 1, 12-11-08; Ord. No. 09-068, § 1, 11-19-09)

Sec. 39-277. - Death benefits.

(a)

Preretirement; married participant. If a participant dies while still employed but at a time when he is eligible for early or normal retirement and if he is survived by a spouse, his surviving spouse shall receive the surviving spouse's benefit described in section 39-276(c) which she would have been entitled to receive if the participant had retired the day before he died. If a participant dies while still employed but at a time when he has completed at least 15 years of credited service and if he is survived by a spouse, his surviving spouse shall receive a monthly pension at the annual rate of 50 percent times 1.85 percent of the participant's final average base salary multiplied by his years of credited service to date of death, a maximum of 30 years. A surviving spouse who is eligible for the benefit described in both the preceding two sentences shall receive only the larger benefit. The surviving spouse's monthly pension payments shall commence on the first of the month coincident with or immediately following the participant's death and shall terminate with the last payment made in the month in which she dies. If the aggregate payments to the participant and surviving spouse are less than the accumulated employee contributions with credited interest at retirement, the balance of such contribution amount will be paid to the designated beneficiary. If there is no designated beneficiary, it shall be paid to the spouse's estate.

Notwithstanding any provision to the contrary, effective July 1, 2008, for any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, ("AFSCME") Local 320, (2) the collective bargaining agreement of the AFSCME Local 1102 and Council 81 and (3) the collective bargaining agreement of the AFSCME Local 1102B, who dies on or after July 1, 2008, his surviving spouse or his designated beneficiary or estate, shall receive a death benefit at the annual rate of 2.0 percent of his final average base salary multiplied by his years of credited service for up to 35 years of credited service at the annual rate of 50 percent, but otherwise in accordance with the provisions of this section 39-277.

(b)

Preretirement; unmarried participant. If a participant dies while still employed but at a time when he is eligible for early or normal retirement and he is not survived by a spouse, then his designated beneficiary, or the beneficiary's estate, shall receive the survivor benefit described in section 39-276(d) which that beneficiary or estate would have been entitled to receive if the participant had retired the day before he died.

(c)

Preretirement and less than 15 years of service; married or unmarried participant. If a participant dies while still employed but at a time prior to completion of 15 years of credited service, if he is survived by a spouse, his surviving spouse, or if he is unmarried, his designated beneficiary, or the beneficiary's estate, shall be eligible to receive a refund of contributions determined in accordance with the provisions of subsection 39-275(g).

(Code 1968, § 28A-135; Ord. No. 08-087, § 1, 12-11-08; Ord. No. 09-068, § 1, 11-19-09)

Sec. 39-278. - Disability benefits.

(a)

Any participant who becomes totally disabled after the completion of at least 15 years of credited service and while still employed by the city shall receive a disability benefit at the annual rate of 1.85 percent of his final average base salary multiplied by his years of credited service, a maximum of 30 years. The benefits under this section shall be reduced by the amount of any workers' compensation benefit paid to the disabled participant. In addition, if the disabled participant thereafter engages in any gainful occupation or business, this benefit shall be further reduced by the excess, if any, of the compensation or profit earned from such occupation or business, over one-half of the compensation for a comparable period last received by the participant from the city. This benefit shall not be reduced by early retirement factors on account of payments beginning prior to his normal retirement date.

Notwithstanding any provision to the contrary, effective July 1, 2008, any participant represented by (1) the collective bargaining agreement of the American Federation of State, County and Municipal Employees, AFL-CIO, ("AFSCME") Local 320, (2) the collective bargaining agreement of the AFSCME Local 1102 and Council 81 and (3) the collective bargaining agreement of the AFSCME Local 1102B, who is otherwise eligible under this section and becomes totally disabled on or after July 1, 2008, may retire at any time on or after his normal retirement and receive a disability pension at the annual rate of 2.0 percent of his final average base salary multiplied by his years of credited service for up to 35 years of credited service, but otherwise in accordance with the requirements of this section 39-278.

(b)

The disability benefit shall be paid monthly beginning on the first day of the month immediately following termination of employment on account of the disability and continuing until and including the month in which the participant is no longer totally disabled, or in which he dies, or in which he reaches his normal retirement date, whichever occurs sooner.

(c)

If the disabled participant recovers prior to his normal retirement date, he shall thereafter be eligible for early or normal retirement in accordance with section 39-276. He will not be credited with service during the period of his disability. If he is not then eligible for early retirement and he does not return to the city's employ within 90 days of notice from the board of pensions, he will be treated as having terminated employment on the date his disability commenced and he will thereafter be eligible for benefits for terminated vested employees in accordance with section 39-279

(d)

If the disabled participant dies while still eligible to receive disability benefits and if he is survived by a spouse, his surviving spouse shall be paid a monthly pension at the annual rate of 50 percent times 1.85 percent of the participant's final average base salary multiplied by his years of credited service, a maximum of 30 years.

This benefit shall be reduced by the amount of any workers' compensation survivor benefit paid to the surviving spouse. The surviving spouse's monthly pension benefit shall be paid on the first day of each month beginning with the month following the participant's death and continuing until and including the month in which she dies or remarries. This surviving spouse's pension will be paid only to a spouse to whom the participant was married when he became disabled.

If the disabled participant dies while still eligible to receive disability benefits and after attaining age 55, as applicable and in accordance with section 39-279(b), and he is not survived by a spouse, his designated beneficiary, or the beneficiary's estate, shall receive the survivor benefit which that beneficiary or estate would have been entitled to receive if the participant had retired the day before he died.

(e)

If the participant remains disabled until his normal retirement date, he will then begin to receive his normal retirement pension in accordance with section 39-276(a). He will not be credited with service during the period of his disability.

(f)

A participant shall be considered totally disabled if he is physically or mentally incapable of continuing the regular duties of his occupation or any other duties which are consistent with his education and prior employment experience. The physical or mental condition of the participant shall be determined by a physician selected by the board of pensions. Disability benefits shall be paid retroactive to the time the disability was determined to have begun except that benefits shall not be paid with respect to any period more than one year prior to the filing of a written claim with the board of pensions. While the participant is receiving disability benefits, the board of pensions may require the participant to submit, at least annually, satisfactory evidence of his continuing disability.

(g)

In the event of the death of a participant prior to reaching his 55^th birthday, the participant's surviving spouse, or his designated beneficiary, or the beneficiary's estate, as the case may be, shall be eligible to receive a refund of the participant's contributions as determined in accordance with the provisions of section 39-275(g)(2) of this article.

(h)

Any participant who becomes totally disabled and has not completed at least 15 years of credited service while employed by the city shall not be entitled to receive benefits under this section.

(Code 1968, § 28A-136; Ord. No. 08-087, § 1, 12-11-08; Ord. No. 09-068, § 1, 11-19-09)

Sec. 39-279. - Termination of employment prior to eligibility for retirement benefits.

(a)

Entitlement to benefits. If a participant terminates employment with fewer than five years of credited service, he shall be entitled to only a refund of his accumulated employee contributions with credited interest. If a participant terminates employment with at least five years of credited service, a terminated vested participant, he shall be entitled at his normal retirement date to receive the normal retirement pension described in section 39-276(a) multiplied by the vested percentage indicated in the table below depending on the number of his years of credited service:

A participant who attains his normal retirement date while in the employment of the city shall be 100 percent vested. Such employee may elect in lieu of a deferred retirement benefit a refund of accumulated employee contributions plus credited interest. If an employee elects a refund, he shall forfeit any other benefits accrued under Plan III.

(b)

Early retirement option at age 55. If a participant terminates employment with at least five years of credited service, he shall be entitled to elect at any time on or after the first of the month coincident with or following his 55th birthday to receive the early retirement pension described in section 39-275(a) multiplied by the vested percentage indicated in the table in subsection (a) of this section depending on the number of his years of credited service.

(c)

Payment of benefit to an unmarried participant. If a terminated vested participant is not married on his retirement date, his pension will be paid to him monthly in the form of a ten-year certain and life basis annuity. That is, 1/12 of his annual pension will be paid to him on the first day of each month beginning with his retirement date and continuing until and including the first day of the month in which he dies. If he dies before 120 monthly payments have been made to him, these monthly payments will continue to his designated beneficiary, or the beneficiary's estate, until a total of 120 monthly payments have been made to him and his beneficiary, or beneficiary's estate, combined.

(d)

Payment of benefit to a married participant. If a terminated vested participant is married on his retirement date, his pension shall be paid to him in the form of a joint and 50 percent surviving spouse's annuity, unless he elects one of the optional forms of benefit described below in this paragraph, which total benefit shall be the actuarial equivalent of a single life annuity for the participant. That is, 1/12 of his annual pension, actuarially reduced on account of payment over two lives rather than one, shall be paid to him monthly on the first day of each month beginning with his retirement date and continuing until and including the first day of the month in which he dies.

After his death, 50 percent of his actuarially reduced pension will be continued to his surviving spouse with monthly payments to begin the first day of the month following the participant's death and continuing until and including the first day of the month in which she dies or remarries. This surviving spouse's benefit will only be paid to a spouse to whom the participant was married on his retirement date.

Notwithstanding the above, a married participant may elect for his benefit to be paid in the form of a single life annuity with no benefits to be paid after his death or in the form of a single life annuity on a ten-year certain basis, both as described in subsection (c) of this section.

(e)

Preretirement spouse's death benefit. If a participant terminates employment with at least five years of credited service, and if he dies after the first day of the month coincident with or immediately following his 55th birthday, pursuant to section 39-275(a), but before retirement payments begin, and if he is survived by a spouse, then, unless he makes the election described below in this subsection, his surviving spouse will receive a survivor's pension equal to 50 percent of the actuarially reduced pension to which the participant would have been entitled if he had retired on the day he died with a joint and 50 percent surviving spouse's benefit in effect pursuant to the provisions of section 39-275(a). This surviving spouse's pension will be paid monthly beginning on the first day of the month coincident with or immediately following the participant's death and continuing until and including the first day of the month in which she dies or remarries. If such a married participant does not die during the period this surviving spouse's benefit is in effect, then at his subsequent retirement date his pension will be actuarially reduced to reflect the cost of his death benefit. Notwithstanding the above, a terminated participant who is married may elect for this surviving spouse's benefit not to be in effect, in which case no survivor benefit will be paid after his death if he dies prior to his retirement date. If a terminated vested participant dies prior to becoming eligible for normal or early retirement, no survivor benefits shall be paid on account of his death to a surviving spouse or any other beneficiary.

(f)

Refund of contributions. If a terminated vested participant and his beneficiary die prior to receiving benefits equal to his employee contributions with interest at termination of employment, the remaining amount shall be paid to his designated beneficiary. If there is no designated beneficiary, the balance shall be paid to the participant's estate.

(g)

Surviving spouse benefit; designated beneficiary benefit. In any instance in which a former city employee dies after termination of city employment in terminated vested status, his or her surviving spouse shall be entitled to 50 percent of the benefit which the city employee would have received at that point in time when said employee would have reached the age of eligibility for receiving a terminated vested participant benefit. This benefit for the surviving spouse shall continue until death or remarriage of the surviving spouse.

In the case of a designated beneficiary, such beneficiary shall receive 100 percent of the benefit which the city employee would have received at that point in time, when said employee would have reached the age of eligibility for receiving a terminated vested participant benefit. A designated beneficiary, or the designated beneficiary's estate, shall receive a total of 120 monthly payments.

(Code 1968, § 28A-137; Ord. No. 97-101, § 2, 1-8-98; Ord. No. 98-034, § 1, 4-2-98)

Sec. 39-280. - Claims procedure; plan administration; funding.

(a)

A participant, surviving spouse, or any other beneficiary shall not be entitled to receive any benefit provided under this Plan III prior to having given written notice of such claim to the board of pensions, provided that payment will be made retroactive to the time it was first due except that no benefit will be paid with respect to any period more than one year prior to the filing of such a written claim with the board of pensions. Any notice called for under this Plan III to a participant (or beneficiary) shall be deemed given when delivered to the U.S. mail with first class postage paid and addressed to the last address of the participant or beneficiary in the personnel records of the city. Any notice called for under this section to the board of pensions shall be deemed given when actually received in writing by the board of pensions.

(b)

This Plan III shall be administered by the board of pensions and retirement which may make rules and regulations not inconsistent with this Plan III for the purposes of carrying out its administrative duties. It shall give appropriate advance notice to participants and beneficiaries of action required in connection with optional benefits under this Plan III. It shall develop procedures for notifying participants of their obligation to designate a death beneficiary under Plan III and it shall obtain such designations. It may hire consultants to assist with any of its administrative duties. The board of pensions shall have the sole authority to interpret the provisions of Plan III and to determine all questions of eligibility, rights and benefits under this Plan III. The board shall be authorized to resolve administratively an equitable accommodation and revision of a participant's buy-back contributions for prior years of service, if during the amortization period, the participant encounters financial circumstances not foreseen at the time of exercise of the buy-back option that renders continued contributions an extreme hardship or practical impossibility. In all such actions, it shall act in accordance with uniformly applied rules and practices and its determinations shall be binding on all persons affected thereby.

(c)

The board of pensions shall be responsible for developing a funding policy for the investment of Plan III assets and it shall be responsible for the management and investment of Plan III assets. It may hire consultants or investment advisors to assist in this regard. It may delegate the authority to manage and invest Plan III assets to any investment manager which:

(1)

Is registered as an investment advisor under the federal Investment Advisors Act of 1940;

(2)

Is a bank, as defined in that Act; or

(3)

Is an insurance company qualified to manage, acquire, or dispose of any asset of an employee benefit plan under the laws of more than one state and which further acknowledges that it is fiduciary with respect to this Plan III.

(d)

The board of pensions shall submit to the city council, not later than five months after the close of Plan III's fiscal year, a financial report for that year audited by an independent certified public accountant.

(e)

The city will make contributions to the board of pensions to fund this Plan III in accordance with actuarial determinations made not less frequently than once every three years. The city's contributions shall be designated to amortize the unfunded liability over a period not to exceed 40 years. In any event, the city's contribution in any one year shall not be less than the full current cost plus the interest on the unfunded liability. The board of pensions' annual financial report to the city shall include a recommendation with respect to the contribution required to meet the funding requirements under this Plan III.

(f)

All Plan III assets shall be held by the board of pensions as trustee in trust for the exclusive benefit of Plan III participants and their beneficiaries. No Plan III funds may revert to the city prior to the satisfaction of all Plan III liabilities. Forfeitures under Plan III shall not be used to increase any participant's benefit but rather shall be applied to reduce the cost of funding Plan III.

(g)

None of the benefits provided under this Plan III shall be subject to the claims of, or to execution, attachment, garnishment or other legal process, by a creditor of a participant or beneficiary. No participant or beneficiary under this Plan III shall have any right to alienate, encumber or assign any of the benefits provided herein, or any interest arising out of or created by this Plan III.

(Code 1968, § 28A-138)

Sec. 39-281. - Amendment, termination, limitations on benefits, merger, etc.

(a)

This Plan III may be amended from time to time by the city council; however, no such amendment shall impair any participant's rights in Plan III prior to the amendment. Upon termination, partial termination, or complete cessation of contribution, all affected participants shall become 100 percent vested in their benefits accrued to date to the extent then funded.

(b)

This Plan III may not be consolidated or merged with another plan unless the benefits provided for participants immediately after such merger, consolidation or transfer, in the event such successor plan should then terminate, will be at least equal to the benefits to which such participants would have been entitled if this Plan III had terminated immediately before such merger or consolidation.

(c)

In the event Plan III is terminated, to the extent Plan III benefits are not already guaranteed by an insurance company, the assets of Plan III will be allocated to pay all Plan III administration expenses and then will be allocated to provide benefits as follows:

(1)

First, for each participant employed by the city, for each retired or disabled participant, for each survivor beneficiary eligible to receive a benefit, and for each participant eligible to retire, an amount will be allocated to provide a refund of the full amount of each participant's contributions to the plan, plus interest at a rate to be determined at such time by the board of pensions;

(2)

Second, for each retired or disabled participant, for each survivor beneficiary eligible to receive a benefit, and for each participant eligible to retire, an amount will be allocated to provide his pension benefit;

(3)

Third, for each other participant who has at least five years of credited service and is therefore at least partially vested, an amount will be allocated to provide his accrued vested benefit;

(4)

Fourth, for each participant an amount will be allocated to provide his accrued benefit which is not vested; and

(5)

Fifth, any excess will be refunded to the city.

No assets will be allocated to a lower order of priority unless all higher orders of priorities have been fully satisfied. If assets are insufficient to fully satisfy any one order of priority, allocation will be made pro rata within that order of priority. In the event the U.S. Secretary of the Treasury determines that the plan assets must be allocated in some different manner in order to satisfy the nondiscrimination requirements of Internal Revenue Code section 401(a)(4), the assets shall be so allocated.

(Code 1968, § 28A-139)

Sec. 39-282. - Miscellaneous provisions.

(a)

Competence of recipient. If an individual entitled to any payment under Plan III is a minor or is, in the opinion of the board of pensions, mentally or physically incapable of managing his financial affairs, the board of pensions may direct that payment be made to the person or institution providing for that individual's care and maintenance. Any such payment shall completely discharge Plan III's liability for the amount paid.

(b)

Frequency of payment; lump sum payment. If any benefit under this Plan III is payable at a monthly rate smaller than $25.00, the board of pensions may direct that payment be made less frequently for an equitably adjusted amount. If the actuarial equivalent of any benefit is smaller than $3,500.00, the board of pensions may pay that actuarial equivalent in a single lump sum. If the actuarial value of benefit payments becomes payable under this Plan III, such value will be calculated on the basis of the actuarial assumptions used by an independent actuary in connection with the most recent actuarial valuation of Plan III assets.

(c)

Refund provisions. Participants in this Plan III may be eligible for refunds of contributions to the plan only in accordance with the provisions of sections 39-275(g), 39-280(b) and 39-281(c)(1).

(d)

Construction of gender. In the construction of Plan III, the masculine shall include the feminine and the singular the plural in all cases in which such meanings are appropriate.

(e)

Limitation on benefits. Notwithstanding any other provisions of this article or of the ordinance from which it derives to the contrary, benefits shall be limited by section 415 of the Internal Revenue Code, which is hereby incorporated herein by reference, and the regulations promulgated thereunder.

(f)

Distribution. Notwithstanding any other provisions of this article or of the ordinance from which it derives to the contrary, distributions will be made in accordance with section 401(a)(9) of the Internal Revenue Code (which is hereby incorporated herein by reference) and the regulations promulgated thereunder, including 1.401(a)(9)—(12).

(Code 1968, § 28A-140)

Secs. 39-283—39-300. - Reserved.