Resolution Number 01-12-18-02RESOLUTION NO. 01-12-18-02
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN JUAN
CAPISTRANO, CALIFORNIA, APPROVING AN AMENDMENT TO THE
DEFERRED COMPENSATION PLAN FOR CITY EMPLOYEES
WHEREAS, by Resolution No. 79-8-15-5, adopted by the City Council of
the City of San Juan Capistrano ("City") on August 15, 1979, the City approved and
adopted a Deferred Compensation Plan ("Plan") to allow employees to defer income for
retirement purposes; and
WHEREAS, by Resolution No. 98-12-15-2, adopted by the City Council on
December 15, 1998, the Plan was amended due to changes in applicable Internal
Revenue Code provisions; and
WHEREAS, the City Council desires to again amend the Plan, due to
further changes in applicable Internal Revenue Code provisions regarding the maximum
annual deferral amount a Participant may defer each year.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City
of San Juan Capistrano does hereby, determine and order:
1. A new Section 3.1 is added to the Plan, as follows.
"3.1 "Applicable dollar amount" shall mean the maximum amount of elective
deferrals that a Participant in the Employer's Section 457 Plan may defer
for the taxable year, as set forth in Section 4.2 (a) and (b).
The numbering for Section 3, Definitions, is changed as a result of this newly
added Section.
2. A new Section 3.12 is added to the Plan, as follows.
"3.12 "Maximum annual deferral" shall mean the overall maximum annual dollar
amount (except for rollover amounts) that a Participant in the Employer's
Section 457 Plan may defer pursuant to Sections 4.2 and 4.3 of the Plan."
The numbering for Section 3, Definitions, is changed as a result of this additional
Section.
3. A new Section 3.18 is added to the Plan, as follows.
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"3.18 "Qualified Domestic Relations Order ("QDRO")" is a judgment, decree or
order (such as an order approving of a property settlement agreement)
that: (1) relates to the provision of child support, or marital property rights
to a spouse, former spouse, child, or other dependent of a Participant; and
(2) creates or recognizes the existence of an alternate payee's right to
receive all or a portion of the Participant's Investment Account."
The numbering for Section 3, Definitions, is changed as a result of this additional
Section.
4. Subsection 4.2 of the Plan is hereby deleted in its entirety and the following
language is hereby inserted in its place and stead:
"4.2 Each Participation Agreement shall specify the amount of compensation,
either by dollar amount or by percentage of Salary, which is to be deferred
pursuant to the Plan and to be withheld out of the Salary otherwise
payable to the Participant for each pay period. The amount deferred each
year may not exceed the lesser of:
(a) The "applicable dollar amount" determined in accordance with the
following table:
Taxable Year Applicable Dollar Amount
2001
$8,500
2002
$11,000
2003
$12,000
2004
$13,000
2005
$14,000
2006 or thereafter
$15,000
or
(b) One Hundred Percent (100%) of the Participant's Includible
Compensation.
A Participant's contribution may not be less than Three Hundred Dollars
($300.00) each year. This three hundred dollar ($300.00) limitation shall
1 Cost -of -Living adjustments: In the case of taxable years beginning after December 31,2006, the Secretary [of the Treasury] shall
adjust the $15,000 amount (A) at the same time and in the same manner as under Internal Revenue Code Section 415(d), except
that the base period shall be the calendar quarter beginning July 1, 2005, and any increase under this section which is not a multiple
of $500 shall be rounded to the next lowest multiple of $500.
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not be applied to any Participant who is paid less than $1,200.00 per year
for services rendered to the Employer."
4. Subsection 4.3 of the Plan is hereby deleted in its entirety and the following
language is hereby inserted in its place and stead:
"4.3 Notwithstanding the provisions of Section 4.2 herein, during any or all of
the last three (3) taxable years ending before a Participant attains Normal
Retirement Age (or the alternate Normal Retirement Age), the maximum
amount which may be deferred annually shall be the lesser of:
(a) Twice the dollar amount in effect in Subsection 4.2(a) for the
taxable year; or
(b) The sum of:
(i) The maximum deferral amount established for the purposes
of Section 4.2 for the taxable year (determined without
regard to this Section 4.3), plus
(ii) The maximum deferral amount established in Section 4.2 for
any prior taxable year or years, less the amount of
-- compensation deferred under the Plan, for such prior taxable
year or years, pursuant to either Section 4.2 or this Section
4.3.
A prior taxable year shall be taken into account under subdivision
(ii) only if: (a) it begins after December 31, 1978; (b) the Participant
was eligible to participate in the Plan during all or any portion of the
taxable year; and (c) compensation deferred (if any) under the Plan
during the taxable year was subject to the maximum deferral
amount under Section 4.2 herein. A Participant will be considered
to have been eligible to participate in the Plan for a taxable year if
the Participant was an Employee for any part of that taxable year. A
prior taxable year includes a taxable year in which the Participant
was eligible to participate in an Internal Revenue Code section 457
eligible deferred compensation plan sponsored by an entity other
than the Employer, provided that such other entity is located in the
State of California.
Section 12.4 is hereby added to the Plan as follows
"12.4 Qualified Domestic Relations Order ("QDRO"). Notwithstanding any other
provision of these Distribution rules to the contrary, if a QDRO provides
that a Participant's benefit is to be divided and a portion allocated to an
alternate payee under the terms of a QDRO (such as a spouse or former
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spouse), such distribution shall not violate this Section. Where a spouse
(or a former spouse) of a Participant in the City's Deferred Compensation
Plan receives a distribution under the terms of a QDRO, the spouse (or
former spouse) will be treated as the distributee and taxed on the benefits
received. Distributions under the City's Deferred Compensation Plan
made to an alternate payee other than a spouse (or former spouse) under
a QDRO are taxable to the Participant."
7. The Plan shall continue in full force and effect except as expressly
amended herein.
December 2001.
ATTEST:
PASSED, APPROVED, AND ADOPTED this 18th day of
R. MONAHAN, CITY CLERK
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.
CITY OF SAN JUAN CAPISTRANO )
I, MARGARET R. MONAHAN, appointed City Clerk of the City of San Juan Capistrano,
do hereby certify that the foregoing Resolution No. 01-12-18-02 was duly adopted by
the City Council of the City of San Juan Capistrano at a regular meeting thereof, held
the 18th day of December 2001, by the following vote:
AYES: COUNCIL MEMBERS
NOES: COUNCIL MEMBERS:
ABSENT: COUNCIL MEMBERS:
oc�
Hart, Campbell, Swerdlin, and Mayor Bathgate
None
Gelff
R. MONAHAN, City Clerk
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