Ordinance 99-3163 ORDINANCE NO. 99-3163
AN ORDINANCE OF THE MAYOR AND CITY
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COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA
AMENDING SECTION 7 OF ORDINANCE NO.83-2398,THE
DEFERRED COMPENSATION ORDINANCE OF THE CITY
OF MIAMI BEACH, FLORIDA, TO REFLECT RECENT
CHANGES IN FEDERAL REGULATION ON
MAINTENANCE OF DEFERRED COMPENSATION PLAN
FUNDS FOR CITY OF MIAMI BEACH EMPLOYEES;
PROVIDING FOR REPEALER; SEVERABILITY; AND AN
EFFECTIVE DATE.
BE IT ORDAINED BY THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH,FLORIDA:
SECTION 1. AMENDMENT OF SECTION 7 OF ORDINANCE NO. 83-2398
That Section 7 of Ordinance No.83-2398 entitled, "Investments and Account Values," is
hereby amended as follows:
SECTION 7. INVESTMENTS AND ACCOUNT VALUES
7-1 Investment of Deferred Compensation. For the purposes of measuring and satisfying the
Employer's obligation to provide benefits under this Plan, the Employer shall invest the
amount of each Participant's Deferred Compensation,in an investment contract or investment
contracts. Such investments shall be made within 72 hours, exclusive of Sundays and
Holidays,from the time the amounts are remitted to the Administrator or otherwise available
for investment. Any such investment contracts and any other property held by the Employer
in trust for Participants or as collateral security for the fulfillment of the Employers's
obligation under this Plan. Any such investment contracts or property shall be subject to the
claims of general creditors of the Employer and no Participant or Beneficiary shall have any
vested interest or secured or preferred position with respect to such contracts or have any
••-- _ - -- - - . - - . - . _ -- . :• . . All assets in any plan,
including all deferred amounts, property and rights purchased with deferred amounts, and
all income attributable to deferred amounts, property of rights, shall (until made available
to the participating employee or beneficiary)be held in a trust, custodial account, or annuity
contract described in the Internal Revenue Code, Section 457(R), for the exclusive benefit
of the participating employees and their beneficiaries.
7-2 Crediting of Accounts. The Participant's Account shall reflect the amount and value of
any investments acquired by the Employer through the, investment of the Participant's
Deferred Compensation. It is anticipated that the Employer's investments with respect to a
participant will conform to the investment selection made in the Participant's Joinder
Agreement, but nothing herein shall be construed to require the Employer to make any
particular investment of a Participant's Deferred Compensation; provided however, the
Employer shall not cause any Deferred Compensation which has been invested in accordance
with a Participant's selection to be liquidated and reinvested under a different investment
contract, except at the request of a Participant and in accordance with regulations or rulings
promulgated under Section 457 of the Code. Each Participant shall receive periodic reports,
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not less frequently than annually, showing: the value of the Account as of the end of the
calendar year or other accounting period for which the report is made; the Account balance
as of the end of the preceding accounting period; the amount of compensation deferred
during the accounting period; and the amount of income, gains or losses credited to the
Participant's Account during the accounting period.
7-3 Employer Liability. In no event shall the Employer's liability to pay benefits to a
Participant under Section 7 exceed the value of payments due under the investments acquired
through the investment of the Participant's Deferred Compensation and credited to the
Participant's Account. The Employer shall not be liable for losses arising from expense
charges of any kind or from depreciation or shrinkage in the value any investments acquired
under this Plan.
SECTION 2. REPEALER.
All ordinances or parts of ordinances in conflict herewith be and the same are hereby
repealed.
SECTION 3. SEVERABILITY.
If any section, subsection,clause or provision of this Ordinance is held invalid,the remainder
shall not be affected by such invalidity.
SECTION 4. EFFECTIVE DATE.
This Ordinance shall take effect on the 16th day of January 1999.
PASSED AND ADOPTED this 6th of January, 1999.
U
ATTEST: , LMAYOR
Cif U�l�a
190ALLA
APPROVED AS TO
CITY CLERK FORM & LANGUAGE
& FOR EXECUTION
SR:PW:GE
1st reading 12/16/98 �'/
2nd reading 1/6/99
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; ITY OF MIAMI BEACH
ITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH,FLORIDA 33139
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COMMISSION MEMORANDUM NO. a 3 -9 9
TO: Mayor Neisen O. Kasdin and DATE: January 6, 1999
Members of the City Commission
FROM: Sergio Rodriguez 4 4
City Manager /f
SUBJECT: AN ORDINANCE AMENDING SECTION 7 OF ORDINANCE NO. 83-2398,
THE DEFERRED COMPENSATION ORDINANCE OF THE CITY OF
MIAMI BEACH, FLORIDA, TO REFLECT RECENT CHANGES IN
FEDERAL REGULATION ON MAINTENANCE OF DEFERRED
COMPENSATION PLAN FUNDS FOR CITY OF MIAMI BEACH
EMPLOYEES; PROVIDING FOR REPEALER; SEVERABILITY; AND AN
EFFECTIVE DATE.
ADMINISTRATION RECOMMENDATION:
Adopt the Ordinance.
BACKGROUND:
This Ordinance was approved on first reading on December 16, 1998.
The law governing Internal Revenue Code(IRC) Section 457 deferred compensation plans has been
changed. This change requires that to be considered a"qualified plan"all assets and income of the
plans must be "held in trust" for the exclusive benefit of the participants rather than the employer.
ANALYSIS
The Deferred Compensation Plan administrators, (ie: ICMA; PEBSCO), have confirmed that their
plans have been modified to be compliant with this change. This action is only proposed as a
"housekeeping" item to modify our existing ordinance to reflect the amendments that have
previously been made by the various Deferred Compensation Plan administrators.
There is no fiscal impact associated with this modification. Effective for periods subsequent to
January 1, 1999, the City will reflect in its financial statements, the changes made by the various
Deferred Plans to be in compliance with both IRC Section 457 and the reporting requirements of
Government Accounting Standards Board (GASB)No. 32 Statement.
CONCLUSION:
The Administration recommends that the City Commission adopt the attached Ordinance.
SR:PW: E AGENDA ITEM
DATE 1— �9
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