Ordinance 2018-4199ORDINANCE NO.
2018 -4199
AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, AMENDING THE POLICE
OFFICERS' RELIEF AND PENSION FUND TO COMPLY WITH
APPLICABLE PROVISIONS OF THE INTERNAL REVENUE CODE,
AND REGULATIONS THEREUNDER, BY AMENDING THE RELATED
SPECIAL ACTS OF THE CITY, BY AMENDING ARTICLE VIII,
ENTITLED "POLICE OFFICERS' RELIEF AND PENSION FUND," BY
AMENDING SECTIONS 49 THROUGH 60 AND CREATING A NEW
SECTION 61; PROVIDING FOR SEVERABI LITY; REPEALER
CODIFICATION; AND AN EFFECTIVE DATE.
BE IT ORDAINED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA:
Section 1. Section 49 of Article VIII of the Related Special Acts of the City
of Miami Beach, is amended as follows:
ARTICLE VIII. POLICE OFFICERS' RELIEF AND PENSION FUND
Sec. 49. Purpose of Act; supplementary to other Acts.
The purpose of this Act is to implement the provisions of Chapter 28230, Laws of
Florida, Acts of 1953, and to provide means whereby policemen {police officers }Police
Officers of the City of Miami Beach, Florida, may receive benefits from the fundsFunds
provided for that purpose by Chapter 28230, Laws of Florida, Acts of 1953. This Act shall
be deemed to supplement any other pension plan of the City of Miami Beach insofar as
benefits to policemen [police officers }Police Officers are concerned, and nothing herein
shall be construed to in any way affect the operating of or benefits of any other pension
plan of the City of Miami Beach, Florida. Sections 1, 1B, 5, 6, 7, 9, 10, 24, 29 and 30 of
Chapter 28230, Laws of Florida, Acts of 1953 shall continue to apply to the City of Miami
Beach except as otherwise specifically provided for in this Act.
Section 2. Section 50 of Article VIII of the Related Special Acts of the City of
Miami Beach, is amended as follows:
Sec. 50. Definitions.
The following words and phrases shall, for the purposes of this Act, have the
meanings hereafter respectively ascribed to them. Other words and phrases shall have
meanings as commonly understood with respect to the context; the singular shall include
the plural, and the masculine the feminine:
(a) Account: shall mean the individual account credited on behalf of each Participant
with contributions pursuant to this Act, eligible forfeiture contributions and
earnings on such contributions.
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(b) Account Balance: shall mean the value of a Participant's Account as of the last
Valuation Date.
(c) Active Duty: shall mean actual service as a Police Officer with regular civil service
status in the police department of the City of Miami Beach, or absent from duty on
an approved leave of absence, all as of the time under consideration.
(ad) Board: shall mean the Board of Trustees of the Miami Beach Policemen's {Police
Officers'} Relief and Pension Fund as provided for herein.
(be) City shall mean the City of Miami Beach, Florida.
officer.
(f) Code: shall mean the Internal Revenue Code of 1986, as amended from time to
time.
(g) Designated Beneficiary: shall mean any person, persons or entity designated by
a Participant to receive any benefits payable under the Fund in the event of the
Participant's death under Code Section 401(a)(9) and Treasury Regulation
Section 1.401(a)(9) -4. If no Designated Beneficiary has been so designated by a
Participant prior to the Participant's death, or if no person, persons or entity so
designated survives the Participant, the Participant's surviving spouse, if any,
shall be deemed to be the Designated Beneficiary; otherwise the Designated
Beneficiary shall be the Participant's estate.
(h) Direct Rollover: shall mean a payment by the Fund directly to the Eligible
Retirement Plan specified by the Distributee.
0) Distributee: shall mean a Police Officer or former Police Officer. In addition, the
Police Officer's or former Police Officer's surviving spouse or former spouse who
has an interest in the Police Officer's benefits under the Fund pursuant to a
domestic relations order honored by the State or the City (if any) are Distributees
with regard to such interest.
(i) Eligible Retired Public Safety Officer: shall mean a Participant who has retired
from the police division of the City (i) by reason of disability or (ii) on or after his
Normal Retirement Age and who is also a "'public safety officer" as defined in
Section 402(I)(4)(C) of the Code and any applicable guidance thereunder.
(k) Eligible Retirement Plan shall mean any of the following types of plans that
accept the Distributee's Eligible Rollover Distribution: (i) a qualified plan
described in Section 401(a) of the Code; (ii) an annuity plan described in Section
403(a) of the Code; and (iii) an individual retirement account or individual
retirement annuity described in Section 408(a) or 408(b) of the Code,
respectively. Additionally, effective January 1, 2002, an Eligible Retirement Plan
shall also mean (i) an annuity contract described in Section 403(b) of the Code or
and (ii) an eligible plan under Section 457(b) of the Code which is maintained by
a state, political subdivision of a state, or any agency or instrumentality of a state
or political subdivision of a state and which agrees to separately account for
amounts transferred into such plan from this Fund.
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(I) Eligible Rollover Distribution: shall mean any distribution of all or any portion of
the balance to the credit of the Distributee, except that an Eligible Rollover
Distribution does not include: (i) any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually) made
for the life (or life expectancy) of the Distributee or the joint lives (or joint life
expectancies) of the Distributee and the Distributee's Designated Beneficiary, or
for a specified period of ten years or more; (ii) any distribution to the extent such
distribution is required under Section 401(a)(9) of the Code; and (iii) after -tax
amounts unless such amount is transferred to an individual retirement account or
individual retirement annuity described in Section 408(a) or 408(b) of the Code,
respectively, or transferred to a defined contribution plan qualified under Section
401(a) of the Code that agrees to separately account for such amount.
last day of February.
(dm)Fund: shall mean the Miami Beach Policemen's [Police Officers'} Relief and
Pension Fund, as provided herein.
(n) Fund Year shall mean the calendar year.
(o) Normal Retirement Age: shall mean "normal retirement age" as such term is
used in the City Pension Fund for Firefighters and Police Officers in the City of
Miami Beach.
(ep) Participant shall mean any :: - • _ _ _ _ _ _ : - - - _ • - -' • , Police
Officer who is eligible to have moneys credited to his i Account
and to receive benefits therefrom under the Fund and this Act, and any person
who was a policeman [police officer }Police Officer on July 31, 1953 and has
separated from the police department.
(q) Police Officers: shall mean the police chief and any person who has attained
regular civil service status in the police department under the official classification
of positions in the classified service of the City and who, in the judgment of the
Board of trustees, performs duties in such department as a peace officer.
(r) Qualified Health insurance Premiums: shall mean premiums for coverage for the
Eligible Retired Public Safety Officer (and his or her spouse and dependents, if
applicable) under accident and health insurance (including an accident or health
plan within the meaning of Section 105(e) of the Code) or a qualified long -term
care insurance contract as defined in Section 7702B(b) of the Code.
(s) Qualified Health Insurance Premium Distribution: shall mean an amount
deducted from an Eligible Retired Public Safety Officer's benefit payment under
the Fund and paid directly to the insurer providing coverage for which Qualified
Health Insurance Premiums are paid. Such amount may not exceed the amount
of the Qualified Health Insurance Premiums.
(t) Retired or Separated Participant: shall mean any Participant who has separated
from service as a Police Officer and has an Account Balance with the Fund.
(fu) Service: shall mean all years and fractions thereof served as an employee of the
pence -Eepartmenta Police Officer of the City for which compensation is paid by
the cityCity, including probationary time, provisional time when it has been
followed by probationary time, all time during which a policeman [police officer]
Police Officer is absent on military leave of absence and all leaves of absence
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during which compensation is paid by the cityCity; but shall not include leaves of
absence during which no compensation is made by the cityCity.
(v) State: shall mean the state of Florida.
(w) Valuation Date: shall mean February 28 of each year and each other date(s) as
the Board may deem necessary.
Section 3. Section 51 of Article VIII of the Related Special Acts of the City of
Miami Beach, is amended as follows:
Sec. 51. Creation of- fundFund; origin of moneys.
There is hereby created in the city fundCity a special Fund to be known as the
Miami Beach Police Officers' Relief and Pension Fund into which shall be paid all
moneys previously received by the cityCity under the provisions of Chapter 28230, Laws
of Florida, Acts of 1953, and all moneys subsequently received by the City under the
provisions of Chapter 28230, Laws of Florida, Acts of 1953. Immediately upon the beard
Board taking office the cityCity shall make payment to the fundFund of the moneys
previously received under Chapter 28230, Laws of Florida, Acts of 1953.
No part of the corpus or income of the Fund shall be used for, or diverted to,
purposes other than for the exclusive benefit of Participants and other persons entitled to
benefits under the Fund and paying the expenses of the Fund not paid directly by any
other party. No person shall have any interest in, or right to, any part of the earnings of the
assets of the Fund, or any right in, or to, any part of the assets held under the Fund, except
as and to the extent expressly provided in this ordinance.
There will be no reversion of the assets of the Fund or City or State contributions,
except as permitted under Section 401(a) of the Code and the regulations and rulings
issued by the Internal Revenue Service relating to Section 401(a), including Revenue
Ruling 91 -4.
Section 4. Section 52 of Article VIII of the Related Special Acts of the City
of Miami Beach, is amended as follows:
Sec. 52. Board of trustees —GCreation; composition; terms of office; officers;
proceedings; compensation.
There is hereby created a beardBoard of the fundFund, which boardBoard shall
consist of five (5) trustees, all of whom shall be participantsParticipants. The trustees shall
be elected by the participantsParticipants and shall serve for a period of twofour (24)
years; provided, however, that immediately upon this Act becoming a law there shall be an
election and the trustees so elected shall hold office until the last day of February, 1956.
Commencing in 1956, elections of trustees shall be held in FebruaryJanuary of the
even - numbered years and trustees elected in such elections shall commence service as
trustees on f\ AarsfaFebruary 1st following such election. Election of trustees shall be by
plurality. The bsardBoard shall annually elect from its membership a chairman and a
secretary who shall keep complete minutes of all proceedings of the bearelBoard and all
actions of the bea4Board shall be by majority vote, a quorum being present. In the
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absence of the chairman, the secretary shall act as chairman. The trustees shall receive
no compensation as such.
Section 5. Section 53 of Article VIII of the Related Special Acts of the
City of Miami Beach, is amended as follows:
Sec. 53. SameBoard of trustees —Power and authority.
The beardBoard shall have power and authority as follows:
(a) To have exclusive charge of the investment of any assets in the fundFund not
needed for the fund'sFund's current obligations, and to invest and reinvest such
assets in accordance with the written investment policy adopted by the
laearelBoard pursuant to paragraph (b) below. Board members must discharge
their duties with respect to the Fund solely in the interest of the
participantGParticipants and beneficiaries for the exclusive purpose of: (i)
providing benefits to participant✓Participants and their beneficiaries; and (ii)
defraying reasonable expenses of administering the planFund; with the care,
skill, prudence, and diligence under 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; by
diversifying the investments of the pianFund so as to minimize the risk of large
losses, unless under the circumstances it is clearly not prudent to do so. Within
the limitations of the foregoing standards and investment policy, the beardBoard
is authorized to acquire and retain in the fundFund every kind of investment
specifically including, but not limited to stocks, bonds, securities, debentures, real
estate, mutual funds, trusts and other obligations which persons of prudence,
discretion and intelligence acquire or retain for their own account. The intent of
this paragraph is to remove any and all investment restrictions which are
otherwise imposed by Ch. 175, Florida Statutes, and which may be removed.
(b) To adopt and periodically update a written investment policy in accordance with
Section 112.661, Florida Statutes, as such statute may be amended in the future.
(c) To convert into cash such securities or savings accounts as may be required for
the payment of claims against the fundFund or for necessary operating
expenses.
{d) To approve claims and to authorize paymcnts from the fund by warrants signed
by the chairman and the secretary of the board.
(ed) To authorize expenditures in connection with preliminary research and technical
services, accounting, auditing, legal services and general administration of the
fundFund.
(fe) To do such other things as may be necessary to implement and provide for the
proper functioning of the fundFund.
(f) To interpret the provisions of this Act where the meaning is not clear or ambiguity
exists; and to promulgate necessary rules respecting the operation of the Fund,
not in conflict with the wording or clear intent of this Act.
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Section 6. Section 54 of Article VIII of the Related Special Acts of the City of
Miami Beach, is amended as follows:
Sec. 54. SameBoard of trustees — Custody of fundFund.
The custody of all securities, savings accounts and moneys of the fundFund shall be
with the beardBoard, which shall make provision for the protection and safekeeping of
such securities in a safety deposit box in such depository as may be designated by the
boardBoard.
Section 7. Section 55 of Article VIII of the Related Special Acts of the City of
Miami Beach, is amended as follows:
Sec. 55. Individual Accounts of Police Officers.
Individual accountsAccounts shall be established for each person who was a
participantParticipant on July 31, 1953, the effective date of Chapter 28230, Laws of
Florida, Acts of 1953, and for all persons who became or become participant&Participants
thereafter. To these asssutsAccounts there shall be credited from each payment to the
fundFund by the cityCity an amount which shall be determined in the manner set forth in
section 9-[57} of this Act. Such amount shall be credited at the time each payment to the
fundFund by the cityCity is received by the fu dFund; provided that the amount to be
credited shall be computed as though said amount had been received on March 10th as
provided in Chapter 28230, Laws of Florida, Acts of 1953; and further provided that a
person who ceases to be a participantParticipant shall also receive a credit on account of
the next payment paid to the fundFund by the cityCity after his separation from
sewiseService. From all other income received by the fundFund there shall be credited to
each participantParticipant an amount which shall be computed as of the date such
payment is actually received by the fundFund, and which shall be computed in the manner
set forth in section 9-[57} of this Act. As of each February 28Valuation Date there shall be
allocated and credited to the
policemen [police officers}Accounts of Participants who are Police Officers on Active Duty
as of such date, their share of nonvested forfeitures of terminated participant&Participants
arising during the prior twelve months, to be made in the same proportion as is the case
above with regard to payments by the cityCity.
The Board shall value the Fund's assets as of each Valuation Date and shall allocate
to the Account of each Participant his share of the increase or decrease in the fair market
value of the Fund's assets.
Except as set forth in this Section 55, Keno further credits shall be made to a
participant's accountParticipant's Account after die the Participant shall have retired under
any other pension plan of the
except as otherwise provided in this ActCity, or after the Participant shall have separated
from Service with the City or otherwise ceased to be a Participant in the Fund. However,
until completely distributed to the Participant, a Participant's Account shall continue to be
invested as part of the Fund and shall continue to share in the investment gains and
losses of the Fund in accordance with this Section 55. A Participant shall continue to
receive allocations of contributions and forfeitures after the Participant ceases to be an
actively employed Police Officer if such contributions and forfeitures are attributable to a
period when the Participant was an actively employed Police Officer. Each Participant
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shall remain a Participant in the Fund until the Participant's Account has been fully
distributed.
Notwithstanding any provision of this Act to the contrary, effective January 1, 2002,
the maximum amount allocated to the Participant's Account for any calendar year under
this Act shall not exceed the lesser of $40,000 or 100% of Compensation, as set forth in
Section 415(c) of the Code, as applicable, and any regulations issued thereunder, and
shall be further adjusted for changes in the cost of living in the manner provided by Code
Section 415(d).
For purposes of applying Section 415 of the Code under this Fund, "Compensation"
means the remuneration paid a Police Officer for services rendered to the City, as
determined in accordance with Treasury Regulation Section 1.415(c) -2 and consistent
with the following provisions.
(I) Effective for Fund Years beginning on or after January 1, 1998, the Participant's
Compensation contributed as employee- elective salary reductions or deferrals to any
salary reduction, deferred compensation, or tax - sheltered annuity program authorized
under the Internal Revenue Code shall be deemed to be the Compensation the member
would receive if he or she were not participating in such program and shall be treated as
Compensation for retirement purposes under this Article.
(II) Effective for Fund Years beginning on or after January 1, 1998, the Participant's
Compensation does not include:
(1) Any contributions (other than elective contributions described in Internal
Revenue Code Sections 402(e)(3), 408(k)(6), 408(p)(2)(A)(i) or 457(b)) made by the
Employer to a plan of deferred compensation (including a simplified employee pension
described in Code Section 408(k) or a simple retirement account described in Code
Section 408(p), and whether or not qualified) to the extent that the contributions are not
includible in the gross income of the Participant for the taxable year in which contributed.
In addition, any distributions from a plan of deferred compensation (whether or not
qualified) are not considered Compensation, regardless of whether such amounts are
includible in the gross income of the Participant when distributed.
(2) Any amounts that receive special tax benefits, such as premiums for
group term life insurance (but only to the extent that the premiums are not includible in the
gross income of the Participant and are not salary reduction amounts that are described in
Code Section 125).
(III) For any person who first becomes a Participant in any Fund Year beginning
on or after January 1, 1996, Compensation for any Fund Year shall not include any
amounts in excess of the Section 401(a)(17) limitation (as amended by the Omnibus
Budget Reconciliation Act of 1993), which limitation of $150,000 shall be adjusted as
required by federal law for qualified government plans and shall be further adjusted for
changes in the cost of living in the manner provided by Internal Revenue Code Section
401(a)(17)(B). For any person who first became a member prior to the first Fund Year
beginning on or after January 1, 1996, the limitation on Compensation shall be not Tess
than the maximum compensation amount that was allowed to be taken into account under
the Fund as in effect on July 1, 1993, which limitation shall be adjusted for changes in the
cost of living since 1989 in the manner provided by Internal Revenue Code Section
401(a)(17). Effective for Fund Years beginning on or after January 1, 2002, Compensation
for any Fund Year shall not include any amounts in excess of the Section 401(a)(17)
limitation which limitation of ',200 000 shall be adusted as required b federal law for
7
qualified government plans and shall be further adjusted for changes in the cost of living in
the manner provided by Internal Revenue Code Section 401(a)(17)(B).
(IV) Annual Compensation means Compensation paid during the Fund Year or
such other consecutive 12 -month period over which Compensation is otherwise
determined under the Fund ( "determination period "). The cost -of- living adjustment in
effect for the calendar year applies to annual Compensation for the determination period
that begins with or within such calendar year. Amounts under Code Section 125 exclude
any amounts not available to a Participant in lieu of group health coverage (deemed Code
Section 125 compensation). An amount will be treated as an amount under Code Section
125 only if the Employer does not request or collect information regarding the Participants'
other health coverage as part of the enrollment process for the health plan.
Section 8. Section 56 of Article VIII of the Related Special Acts of the City of
Miami Beach, isamended as follows:
Sec. 56. Disposition of city'sCity's payment to (Fund.
From thoThe payment to the fund by the city the board shallFund by the City shall
be applied by the Board in the following manner and order of priority:
(a) Pay all costs and expenses of management and operation of the fundFund.
(b) Set aside such amount as the beardBoard in its discretion estimates will be
required for costs and expenses of management and operation of the fundFund during the
year following the date of said payment.
(c)
year in which the payment is received by the city from the state and such sum, together
section, shall be credited to the accounts of participantsCredit to the accounts of
Participants the amounts determined in the manner and at the time provided inprovided
under Section 57 of this Article, together with the investment income determined under
Section 55 of this AstArticle.
Section 9. Section 57 of Article VIII of the Related Special Acts of the City of
Miami Beach, is amended as follows:
Sec. 57. Ratio of amounts credited to t' Participant's Account.
The amounts to be credited to a Participant's Account as
provided in this Act shall be in the same ratio to the total amount to be credited to all
participantsParticipants as such participant's serviceParticipant's Service is to the
scrviccService of all participantsParticipants.
Section 10. Section 58 of Article VIII of the Related Special Acts of the City
of Miami Beach, isamended as follows:
Sec. 58. Rights and benefits of participantsParticipants— Generally.
The fundFund shall provide benefits to participantsParticipants as follows:
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(a) If a participant shall die, the amount in his account shall be paid to such
be paid-to-his surviving spouccParticipant shall die while on Active Duty as a
Police Officer, the Participant shall be 100% vested in his or her entire
Account Balance and his Designated Beneficiary shall be paid the entire
amount of his Account Balance. If no Beneficiary is designated by the
Participant, or the Beneficiary predeceases the Participant, the entire
Account Balance shall be paid to his or her Surviving Spouse. If there beis no
surviving spouseSurviving Spouse, the entire
burial expenses, the excess toAccount Balance shall be paid to the estate of
the deceased pParticipant.
(b) If a participantParticipant shall have retired for service or disabi-liybecomes
disabled under any other pension plan of the cityCity, he or she shall be
100% vested in his or her entire Account and he or she shall be paid the
entire amount in his account in a lump sum or in installments at his election. If
payment is made by installments such payments shall bear no interest and
- - • - - - - - - - - - - - of his or her Account
Balance.
If a participantParticipant shall separate from service as a policeman [police
officer] for the City of Miami BeachActive Duty for any reason whatsoever
prior to death, or service or disability retirementNormal Retirement Age,
except as provided in (a) and (b) above, he or she shall be entitled to a
severance paymentdistribution from the Fund equal to thehis or her vested
amount t„ his credit ccount Balance at that time.
(sd) Payment to a participantParticipant as provided in this scctionSection 58 shall
be full acquittal of all claims of a participantParticipant against the fundFund
and he or she shall thereupon cease to be a participantParticipant in the
Fund.
(de) Each participantParticipant shall be fully (one hundred percent) vested in the
entire amount in his or her assountAccount as it exists on February 28, 1983.
Any subsequent increases in such- accounta Participant's Account, whether
from allocation of cityCity payment of premium tax refunds, investment
earnings, or any other source, shall be vested in accordance with the
following schedule:
Years of
Service
Less than 10
10 or over
Vested
Percent
None
100
Any nonvested amounts which are not distributable under (a), (b) or (bc)
9
above shall be forfeited by the participantParticipant and reallocated to
remaining participant: Participants as provided herein.
(f) It is the intent of the City to continue the Fund indefinitely. However, in the
event of the termination of the Fund, all Participants shall be 100% vested in
their entire Account Balances as of such termination date.
(q) If permitted by the Board, a Participant who is an Eligible Retired Public
Safety Officer and is receiving benefits under the Fund may elect to have
Qualified Health Insurance Premium Distributions made in accordance with
this Section 58(g). Qualified Health Insurance Premium Distributions may
be excluded from the gross income of the Eligible Retired Public Safety
Officer under Section 402(1) of the Code, subject to the annual dollar
limitation therein.
(h) Once a Participant has separated from Active Duty, the Participant may elect
to receive his or her vested benefit as a single cash lump sum or may elect to
make withdrawals in his discretion (subject to the required minimum
distribution requirements described in Section 58(i) below), from time to time.
(I) Notwithstanding anything herein to the contrary, effective for Fund Years
beginning on or after January 1, 1997, a Participant's benefits under the
Fund shall commence no later than April 1 of the calendar year following the
later of (i) the calendar year in which he or she attains age 70 1/2; or (ii) the
calendar year in which he retires. All distributions shall conform to the
regulations issued under Section 401(a)(9) of the Code, including the
incidental death benefit provisions of Section 401(a)(9)(G) of the Code.
Further, such regulations shall override any provision that is inconsistent with
Section 401(a)(9) of the Code. Notwithstanding any provision of this Act to
the contrary, a form of retirement income payable from this Fund, shall
satisfy the following conditions:
(i) If the retirement income is payable before the Participant's
death:
(A) It shall either be distributed or the distribution commenced
to the Participant not later than April 1 of the calendar year
following the later of the calendar year in which the
Participant attains age 70 1/2, or the calendar year in which
the Participant retires; or
(B) The distribution shall commence no later than the calendar
year defined above; and (x) shall be paid over the life of the
Participant or over the lifetimes of the Participant and his or
her spouse, issue or dependent, or (y) shall be paid over the
period extending not beyond the life expectancy of the
Participant and spouse, issue or dependent.
Where a form of retirement income payment has commenced in
accordance with the preceding paragraphs and the Participant dies before
his entire interest in the Fund has been distributed, the remaining portion of
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such interest in the Fund shall be distributed no less rapidly than under the
form of distribution in effect at the time of the Participant's death.
(ii) If the Participant's death occurs before the distribution of his
interest in the Fund has commenced, Participant's entire interest in
the Fund shall be distributed within five years of Participant's death,
unless his or her interest is distributed in accordance with the
following rules:
(A) The Participant's remaining interest in the Fund is payable
to his or her spouse, issue or dependent; and
(B) The remaining interest to be distributed over the life of the
spouse, issue or dependent or over a period not extending
beyond the life expectancy of the spouse, issue or
dependent; and
(C) Such distribution begins within one year of the Participant's
death unless the Participant's spouse is the sole designated
beneficiary, in which case the distribution need not begin
before the date on which the Participant would have
attained age 701/2 and if the Participant's spouse dies
before the distribution to the spouse begins, this section
shall be applied as if the spouse were the Participant.
(k) Direct rollovers:
(i) Notwithstanding any provision of this Fund to the contrary that
would otherwise limit a Distributee's election under this paragraph,
effective January 1, 2002, a Distributee may elect, at the time and
in the manner prescribed by the Board, to have any portion of an
Eligible Rollover Distribution paid directly by the Fund to an Eligible
Retirement Plan specified by the Distributee in a Direct Rollover.
(ii) With respect to distributions after December 31, 2009, a
non - spouse beneficiary who is a Designated Beneficiary may, by a
Direct Rollover, roll over all or any portion of his or her distribution to
an individual retirement account the non - spouse beneficiary
establishes for purposes of receiving the distribution. In order to be
able to roll over the distribution, the distribution otherwise must
satisfy the definition of an Eligible Rollover Distribution. Although
such non - spouse beneficiary may roll over such distribution, any
distribution made prior to January 1, 2010, is not subject to the
direct rollover requirements of Code Section 401(a)(31) (including
Code Section 401(a)(31)(B), the notice requirements of Code
Section 402(f) or the mandatory withholding requirements of Code
Section 3405(c)). If a non- spouse beneficiary receives a distribution
from the Fund, the distribution is not eligible for a "60 -day" rollover.
A non - spouse beneficiary may not roll over an amount which is a
required minimum distribution, as determined under applicable
Treasury Regulations and other Internal Revenue Service
11
guidance. If the Participant dies before his or her Required
Beginning Date (as defined below) and the non - spouse beneficiary
rolls over to an individual retirement account the maximum amount
eligible for rollover, the non - spouse beneficiary may elect to use
either the 5 -year rule or the life expectancy rule, pursuant to
Treasury Regulation Section 1.401(a)(9) -3, A -4(c), in determining
the required minimum distributions from the individual retirement
account that receives the non - spouse beneficiary's distribution.
The term "Required Beginning Date" means the later of the April 1
following (i) the calendar year in which the Participant attains age
701 or (ii) the calendar year in which the Participant terminates his
employment.
(iii) If the Participant's named beneficiary is a trust, the Fund may make
a Direct Rollover to an individual retirement account on behalf of the
trust, provided the trust satisfies the requirements to be a
Designated Beneficiary.
(iv) With respect to distributions made after December 31, 2007, a
Distributee may elect to roll over via Direct Rollover an Eligible
Rollover Distribution to a Roth individual retirement account
described in Code Section 408A(b).
(I) Upon the death of a Retired or Separated Participant, such Participant's
surviving spouse shall have all the distribution options that were available
to the Retired or Separated Participant pursuant to this Section 58.
(m) Notwithstandinq any provision of this Act to the contrary:
(i) Effective for Fund Years beginning on or after January 1, 1995,
contributions, benefits and service credit with respect to qualified
military service will be provided in accordance with Code Section
414(u);
(ii) Effective for deaths occurring on or after January 1, 2007, if a
Participant dies while performing qualified military service (as
defined in Code Section 414(u)), the survivors of the Participant are
entitled to any additional benefits (other than benefit accruals
relating to the period of qualified military service) provided under
the Fund as if the Participant had resumed and then terminated
employment on account of death;
(iii) For benefit accrual purposes, the Fund will treat a Participant who
dies or becomes Disabled on or after January 1, 2007, while
performing qualified military service (as defined in Code Section
414(u)) as if the Participant had resumed employment in
accordance with his reemployment rights under USERRA, on the
day preceding death or disability (as the case may be) and
separated from service on the actual date of such death or
disability;
12
(iv) For years beginning after December 31, 2008, (1) an individual
receiving a differential wage payment, as defined by Code Section
3401(h)(2), is treated as a Participant of the employer making the
payment, (2) the differential wage payment is treated as
compensation, and (3) the Fund is not treated as failing to meet the
requirements of any provision described in Code Section
414(u)(1)(C) by reason of any contribution or benefit which is based
on the differential wage payment; and
(v) Effective as of January 1, 2009, for purposes of being eligible to
receive a distribution under the Fund, an individual will be treated
as having been terminated from employment during any period the
individual is performing service in the uniformed services described
in Code Section 3401(h)(2)(A).
(n) Each Participant, beneficiary or other person entitled to a benefit, before
any benefit shall be payable to him or her or on his or her Account under
the Fund, shall file with the Board the information that it shall require to
establish his or her rights and benefits under the Fund.
Section 11. Section 59 of Article VIII of the Related Special Acts of the City of
Miami Beach, isamended as follows:
Sec. 59. SameRights and benefits of Participants —Not subject to encumbrance.
The rights and benefits provided for herein shall not be subject to attachment,
garnishment, execution or any other legal process.
Section 12. Section 60 of Article VIII of the Related Special Acts of the City of
Miami Beach, is amended as follows:
Sec. 60. Responsibility of cityCity.
The City of Miami Beach shall have no responsibility for the operation of the fundFund
and shall bear no expense in connection therewith.
Section 13. New Section 61 is added to Article VIII of the Related Special
Acts of the City of Miami Beach, to read as follows:
Sec. 61. Tax Qualified Plan.
The provisions of this Act and the Fund are intended to meet the requirements of a
qualified plan under Section 401(a) of the Code and to be tax- exempt under Section
501(a) of the Code. Should any changes be required to comply or to continue to comply
with the provisions of Sections 401(a) and 501(a) of the Code, the Board and the City shall
take all appropriate steps to make any such required changes to the Fund.
13
Section 14. Codification. This Ordinance shall be codified in Article VIII of the
Related Special Acts of the City of Miami Beach.
Section 15. Effective date. This Ordinance shall take effect ten days following
adoption, except as otherwise specified herein.
PASSED and ADOPTED this 2 day of JtMe , 2018.
ATTEST:
1 ,L V-
Rafael E. Granado
City Clerk
(Sponsored by Commissioner Joh
Underscore denotes new language
•
Dan Gelber
Mayor
APPROVED AS TO
FORM & LANGUAGE
& FOR EXECUTI
drehd.Zdisior:
►o, City Attorney
,,;:,.,., :tip •.
aJ/ 1-Er�.
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14
Dot
MIAMI BEACH
Ordinances - R5 A
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Jimmy L. Morales, City Manager
DATE: June 6, 2018
10:50 a.m. Second Reading Public Hearing
SUBJECT: AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA, AMENDING THE POLICE OFFICERS' RELIEF AND
PENSION FUND TO COMPLY WITH APPLICABLE PROVISIONS OF THE
INTERNAL REVENUE CODE, AND REGULATIONS THEREUNDER, BY
AMENDING THE RELATED SPECIAL ACTS OF THE CITY, BY AMENDING
ARTICLE VIII, ENTITLED "POLICE OFFICERS' RELIEF AND PENSION FUND," BY
AMENDING SECTIONS 49 THROUGH 60 AND CREATING A NEW SECTION 61;
PROVIDING FOR SEVERABILITY; REPEALER CODIFICATION; AND AN
EFFECTIVE DATE.
RECOMMENDATION
Adoption of the ordinance is recommended. It is further recommended that the second reading and
public hearing be scheduled for the June 6, 2018 commission meeting.
ANALYSIS
We have reviewed the proposed amendments to the Miami Beach Police Officers' Relief and
Pension Fund with special pension counsel, Jim Linn. His recommendation is attached. All of the
changes proposed to this ordinance are required for compliance with the Internal Revenue Code,
with two exceptions. The two exceptions are: (1) The revision to section 52 that changes the month
for election of trustees from February to January of even numbered years. This change reflects the
current practice; (2) The new provision at the top of page 11 that allows retired members to pay for
health insurance premiums through deductions from their retirement benefit and have the payment
excluded from taxable income. This provision is permitted but not required by the Internal Revenue
Code.
Attached is the Internal Revenue Service (IRS) determination letter dated March 6, 2015. An Internal
Revenue Service "determination letter" is issued in response to a request as to the qualified status of
a retirement plan, and applies only to the employer and the plan participants on whose behalf it was
issued.
The proposed amendments are required by the Internal Revenue Code (IRC) and IRS regulations in
order for the Plan to retain its qualified status and comply with the favorable determination from the
IRS. Among the changes are amendments making gender neutral references throughout the
document, i.e., police officers rather than policemen. More substantial elements include the addition
of 17 newly defined terms and amendments to the seven originally included in the ordinance.
Additionally, the proposed ordinance specifies how a retired /separated member's account is to be
treated until such time as the funds are withdrawn and how survivor benefits are disbursed.
Language further indicates that amounts allocated to a participant's account may not exceed the
limitations set forth in Section 415 of the Code. The proposed maximum limit on annual additions to a
Page 667 of 1103
participant's defined contribution account shall not exceed the lesser of $40,000 or 100% of
Compensation, as set forth in Section 415(c) of the Code. The Plan addresses the manner in which
the City is to dispose of funds, the ratio of amounts credited to a participant's account, and how the
Fund shall provide benefits to the participants.
CONCLUSION
The proposed amendments satisfy the IRS requirements for plan qualification. Further, the
amendments memorialize the City's current intent regarding the benefits derived from the premium
taxes as set forth in Ch. 185, Florida Statutes.
While public employers that sponsor retirement plans are not required to apply for a determination
letter, receiving a favorable determination letter provides documentation that the Plan satisfies the
applicable qualification standards.
There are several legal and practical advantages to obtaining a determination letter. One legal
advantage is that an IRS determination letter provides a definitive analysis of whether a plan is
qualified. It also provides the basis for retroactive relief if the Service later changes its position. One
practical advantage of obtaining a determination letter is that the City's auditors will be less likely to
question the qualified status of the Plan.
We have prepared an ordinance incorporating the IRC compliance amendments. The amendments
are technical in nature, and will not result in additional cost to the City since all funding comes from
state premium taxes in Ch. 185, Florida Statutes. Because of the nature of the 185 plan benefits,
these changes will not have any actuarial impact.
FINANCIAL INFORMATION
Because of the nature of the 185 plan benefits, these changes will not have any actuarial impact.
Legislative Tracking
Human Resources
Sponsor
Commissioner John Elizabeth Aleman
ATTACHMENTS:
Description
o Police Officers' Relief and Pension Fund Ordinance
D IRS Determination Letter
o Outside Counsel Recommendation - Email
Page 668 of 1103
INTERNAL REVENUE SERVICE
P. O. BOX 2508
CINCINNATI, OH 45201
Date:
MAR 0 6 2015
CITY OF MIAMI BEACH
C/O ROBERT J FRIEDMAN
HOLLAND & KNIGHT LLP
701 BRICKELL AVE STE 3300
MIAMI, FL 33131
Dear Applicant:
DEPARTMENT OF THE TREASURY
Employer Identification Number:
59- 6000372
DLN:
17007049050004
Person to Contact:
RUTH CHEN
Contact Telephone Number:
(626) 927 -1423
Plan Name:
MIAMI BEACH POLICE OFFICERS'
RELIEF PENSION FUND
Plan Number: 002
ID# 95048
We have made a favorable determination on the plan identified above based
on the information you have supplied. Please keep this letter, the application
forms submitted to request this letter and all correspondence with the Internal
Revenue Service regarding your application for a determination letter in your
permanent records. You must retain this information to preserve your reliance
on this letter.
Continued qualification of the plan under its present form will depend
on its effect in operation. See section 1.401-1(b) (3) of the Income Tax
Regulations. We will review the status of the plan in operation periodically.
The enclosed Publication 794 explains the significance and the scope of
this favorable determination letter based on the determination requests
selected on your application forms. Publication 794 describes the information
that must be retained to have reliance on this favorable determination letter.
The publication also provides examples of the effect of a plan's operation on
its qualified status and discusses the reporting requirements for qualified
plans. Please read Publication 794.
This letter relates only to the status of your plan under the Internal
Revenue Code. It is not a determination regarding the effect of other federal
or local statutes.
This determination letter gives no reliance for any qualification change
that becomes effective, any guidance published, or any statutes enacted, after
the issuance of the Cumulative List (unless the item has been identified in the
Cumulative List) for the cycle under which this application was submitted.
This determination is subject to your adoption of the proposed amendments
submitted in your letter dated 11 -6 -14. The proposed amendments
should be adopted on or before the date prescribed by the regulations under
Code section 401(b).
This determination letter is applicable to the plan and related documents
• submitted in conjunction with your application filed during the remedial
Letter 2002
Page 683 of 1103
-2-
CITY OF MIAMI BEACH
amendment cycle ending 1- 31 -14.
This letter may not be relied on after the end of the plan's first
five -year remedial amendment cycle that ends more than 12 months after the
application was received. This letter expires on January 31, 2019. This letter
considered the 2012 Cumulative List of Changes in Plan Qualification
.Requirements.
This is not a determination with respect to any language in the plan or
any amendment to the plan that reflects Section 3 of the Defense of Marriage
Act, Pub. L. 104, 110 stat. 2419 (DOMA) or U.S. v. Windsor, 570 U.S. 12 (2013),
which invalidated that section.
We have sent a copy of this letter to your representative as indicated in
the Form 2848 Power of Attorney or appointee as indicated by the Form 8821 Tax
Information Authorization.
If you have questions concerning this matter, please contact the person
whose name and telephone number are shown above.
Enclosures:
Publication 794
Sincerely,
Karen D. Truss
Director, EP Rulings & Agreements
Page 684 of 1103
Letter 2002
From: Jim Linn [t°nalto :jlinnnliw- iaw.com]
Sent: Monday, March 06, 2017 12:26 PM
To: Smith, Michael - HR Dir.
Subject: FW: Miami Beach Police Relief Retirement Plan
Hi Michael - I have reviewed the draft ordinance amending the Miami Beach Police Relief &
Pension Fund that Bob Friedman and Sepedeh Tofigh prepared in conjunction with the request
for an IRS determination letter. The IRS determination letter approving the plan changes was
issued in March 2015.
All of the changes in the draft ordinance are required for compliance with the Internal Revenue
Code, with 2 exceptions:
1. The revision to section 52 (middle of page 5) that changes the month for election of trustees
from February to January of even numbered years. The plan administrator recommended this
change to reflect the current practice. I see no reason to object to this change.
2. The new provision at the top of page 11 that allows retired members to pay for health
insurance premiums through deductions from their retirement benefit, and have the payment
excluded from taxable income. This provision is permitted but not required by the Internal
Revenue Code. However, I see no reason to object to this provision.
In my judgment the draft ordinance is acceptable for adoption.
Please let me know if you have any questions or would like to discuss.
Jim
James W. Linn J Shareholder
315 South Calhoun Street, Suite 830 I Tallahassee, Florida 32301
jlinn(c llw- law.com 1 850.222.5702
vCard I Website I Bio I join us online
(*.LEW L.wis
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Pursuant to federal regulations imposed on practitioners who render tax advice ( "Circular 230 "), we are required to advise you that any tax
advice contained herein is not intended or written to be used for the purpose of avoiding tax penalties that may be imposed by the Internal
Revenue Service. If this advice is or is intended to be used or referred to in promoting, marketing or recommending a partnership or other
entity, investment plan or arrangement, the regulations under Circular 230 require that we advise you as follows: (1) this writing is not intended
or written to be used, and it cannot be used, for the purpose of avoiding tax penalties that may be imposed on a taxpayer; (2) the advice was
written to support the promotion or marketing of the transaction(s) or matter(s) addressed by the written advice; and (3) the taxpayer should
seek advice based on the taxpayer's particular circumstances from an independent tax advisor,
Page 685 of 1103