Supplemental Retirement Program. for Employees of. Chesterfield County Public Schools

Transcription

1 Supplemental Retirement Program for Employees of Chesterfield County Public Schools Amendment and Restatement Effective July 1, 2017

2 Table of Contents Introduction...1 Article 1 Definitions...2 Section 1.1 Actuarial Equivalent...2 Section 1.2 Beneficiary...2 Section 1.3 Contributions...2 Section 1.4 Defined Benefit Plan...2 Section 1.5 Defined Contribution Plan...23 Section 1.6 Early Retirement Age...3 Section 1.7 Effective Date...3 Section 1.8 Employee...3 Section 1.9 Employer...3 Section 1.10 Fiduciary...3 Section 1.11 Final Annual Compensation...3 Section 1.12 Full-Time Regular Employee...4 Section 1.13 Fund...4 Section 1.14 IRC...4 Section 1.15 Leased Employee[Reserved]...4 Section 1.16 Limitation Year...4 Section 1.17 Normal Retirement Age...4 Section 1.18 Participant...54 Section 1.19 Plan...5 Section 1.20 Plan Administrator...5 Section 1.21 Plan Year...5 Section 1.22 Total and Permanent Disability or Totally and Permanently Disabled...5 Section 1.23 Trust Agreement...5 Section 1.24 Trustee...5 Section 1.25 Year of Service...5 Article 2 Eligibility and Participation...6 Section 2.1 Eligibility for Participation...6 Section 2.2 Eligibility for Benefits...6 Section 2.3 Participation...7 Section 2.4 Status of Participant Receiving Benefits...7 Section 2.5 Break in Service Requirement...7 Article 3 EarlySupplemental Retirement Incentive Benefits...8 Section 3.1 EarlySupplemental Retirement Incentive Benefit...8 Section 3.2 Disability Benefit...10 Section 3.3 Death Benefit...10 Section 3.4 Vesting/Extension of Service Requirement...10 Section 3.5 Election of Payment Option...10 Section 3.6 Rollover Distributions...11 Page

3 Section 3.7 Disciplinary Action...12 Section 3.8 USERRA...12 Article 4 Funding...13 Section 4.1 Contributions by the Employer...13 Section 4.2 Trust Fund...13 Article 5 Fiduciaries and Administration of the Plan...14 Section 5.1 General...14 Section 5.2 Employer Responsibilities...14 Section 5.3 Trustee...14 Section 5.4 Plan Administrator...15 Section 5.5 Claims for Benefits...16 Section 5.6 Claims Procedures...16 Section 5.7 Records/Reports...17 Section 5.8 Missing Persons...18 Section 5.9 Audits...18 Article 6 Maximum Benefits and Required Distribution of Benefits...19 Section 6.1 Maximum Retirement Benefit...19 Section 6.2 Required Distribution of Benefits...19 Article 7 Amendment and Termination of the Plan...22 Section 7.1 Amendment of the Plan...22 Section 7.2 Termination of the Plan...22 Article 8 Miscellaneous...23 Section 8.1 Governing Law...23 Section 8.2 Construction...23 Section 8.3 No Employment Contract...23 Section 8.4 Receipt Prior to Payment...23 Section 8.5 Payments to Incompetents...23 Section 8.6 Non-alienability of Benefits...23 Section 8.7 Domestic Relations Order...24 Section 8.8 Merger of Plans...27 Section 8.9 Mistake of Fact...27 Section 8.10 Exclusive Benefit...27 Section 8.11 Expenses...27 Section 8.12 Counterparts Adoption of the Plan

4 Introduction Effective July 1, 1995, the Chesterfield County School Board adopted the Early Retirement Incentive Plan for Employees of Chesterfield County Schools for the benefit of employees eligible to participate therein. Subsequent to that date, the name of the Plan was changed to the "Supplemental Retirement Program for Employees of Chesterfield County Public Schools." The Plan is hereby amended and restated generally effective July 1, 2017 in order to incorporate prior amendments to the Plan and make certain other changes. The purpose of the Supplemental Retirement Plan for Employees of Chesterfield County Public Schools (hereinafter referred to as the "Plan") is to provide earlysupplemental retirement benefits for eligible employees. Benefit payments received by a Participant during the period of time the Participant is providing services to the Employer in a temporary, part-time position shall be made from the general assets of the Employer. Thereafter, benefit payments received by the Participant shall be considered made from a plan qualified under Section 401(a) of the Internal Revenue Code of 1986 ("IRC"), as amended. The Plan is a "governmental plan" under IRC Section 414(d) and Section 3(32) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). As a "governmental plan" under ERISA, the Plan is exempt from the provisions of Title I of ERISA. It is intended that this Plan, together with the Trust Agreement established to carry out the funding of the Plan, provided that the Employer has sufficient funds to meet its obligations hereunder as set forth under applicable law, meet all applicable requirements of the IRC and, wherever possible, the Plan shall be interpreted to comply with the terms of the IRC and all formal regulations and rulings issued under the IRC. 1

5 Article 1 Definitions As used herein and in the concomitant Trust Agreement, unless otherwise required by the context, the following words and phrases shall have the following meanings: Section 1.1 Actuarial Equivalent Actuarial Equivalent means a benefit ofthe equivalent value of a benefit under the Plan (i.e., the value of the benefits provided under the terms of the Plan to a Participant or Beneficiary) when computed on the basis of the actuarial assumption factors denoted in Appendix A. The actuarial assumption factors denoted in Appendix A must be utilized whenever the amount of any Plan benefit is to be determined byon the Administrative Committeebasis of actuarial assumptions. Section 1.2 Beneficiary Beneficiary means any person designated by a Participant or otherwise entitled to receive such benefits as may become payable under the provisions of the Plan after the death of such Participant. The designation of a Beneficiary shall be made on forms provided by the Plan Administrator, and such forms shall be maintained in files held by the Plan Administrator. From time to time, a Participant may change his Beneficiary by written notice to the Plan Administrator. Upon such change, the rights of all previously designated Beneficiaries to receive any benefits under the Plan shall cease. If there is no valid and current Beneficiary designation on file with the Plan Administrator at the date of death of the Participant, any death benefits which would have been payable to the Beneficiary shall be payable to the Participant's spouse, if any; if none, equally to the Participant's surviving children, if any; or if none, then to the Participant's estate. Subject to applicable law, the interpretation of the Plan Administrator with respect to any Beneficiary designation shall be binding and conclusive upon all parties, and no person who claims to be a Beneficiary, or any other person, shall have any right to question any action of the Plan Administrator, which in the judgment of the Plan Administrator fulfills the intent of the Participant who filed such designation. Section 1.3 Contributions Contributions means the payments as provided herein by the Employer to the Fund. Section 1.4 Defined Benefit Plan Defined Benefit Plan means a plan established and qualified under IRC Section 401 or 403, except to the extent it is, or is treated as, a Defined Contribution Plan. 2

6 Section 1.5 Defined Contribution Plan Defined Contribution Plan means a plan established and qualified under IRC Section 401 or 403 which provides for an individual account for each Participant therein and for benefits based solely on the amount contributed to each Participant's account and any income and expenses or gains or losses (both realized and unrealized) which may be allocated to such accounts. Section 1.6 Early Retirement Age Early Retirement Age means the date a Participant shall become eligible for benefits under this Plan as described in Section 2.2. Section 1.7 Effective Date Effective Date means July 1, 1995, or such later date as of which an Employer adopts the Plan for its Employees. The Effective Date of this amended and restated Plan is July 1, Section 1.8 Employee Employee means any person who is employed by the Employer on a full-time basis under the terms of an annual employment contract or notification of assignment, except any person considered a Leased Employee within the definition of IRC Section 414(n). Section 1.9 Employer Employer means the Chesterfield County Public Schools or any successor to such entity. Section 1.10 Fiduciary Fiduciary means the Employer, Trustee, Plan Administrator and any individual, corporation, firm or other entity which assumes in accordance with Article 5 responsibilities of the Employer, Trustee or Plan Administrator respecting management of the Plan or the disposition of its assets. Section 1.11 Final Annual Compensation Final Annual Compensation means, for any Employee, the annual rate of contract compensation in effect at the commencement of retirement paid by the Employer including: (a) (b) (c) any portion of said Employee's base paycontract compensation which would be due and payable had he not signed a salary reduction agreement in order to participate in a tax sheltered annuity program pursuant to IRC Section 403(b); any amount which said Employee could have elected to receive as cash in the current year as taxable income in lieu of a non-taxable benefit under a plan which is maintained pursuant to IRC Section 125; and effective on or after January 1, 2010, any amount paid to said Employee as differential wage payments (as defined in IRC Section 414(u)(12)(D)) during a period of qualified military service (as defined in IRC Section 414(u)(5)). 3

7 Final Annual Compensation shall exclude any contributions by the Employer to this or any other employee benefit program, other than the amount(s) specifically stated herein. In no event shall compensationfinal Annual Compensation as hereinbefore determined exceed the dollar limitation or such adjusted amount as may be determined by the Secretary of Treasury pursuant to IRC Section 401(a)(17) from time to time, provided that the adjustment determined as of any January 1 of a calendar year by the Secretary of Treasury shall be effective for Plan Years beginning in such calendar year. The change in the dollar limitation under IRC Section 401(a)(17) required by the Omnibus Budget Reconciliation Act of 1993 shall have no force and effect, and any required adjustment to the limitation shall not be considered an amendment to this Plan, until July 1, For an Employee who begins receiving benefits under the Plan on or after July 1, 2017, the term Final Annual Compensation shall not exceed $95, for the purpose of calculating such benefits in accordance with Section 3.1. Section 1.12 Full-Time Regular Employee Full-Time Regular Employee means any Employee hired to work the normal, full-time thirty (30) to forty (40) hour workweek on a regular basis. Section 1.13 Fund Fund means the trust fund created in accordance with Article 6. Section 1.14 IRC IRC means the Internal Revenue Code of 1986, as amended from time to time. Any reference to any section of the IRC shall be deemed to include any applicable regulations and rulings pertaining to such section and also shall be deemed a reference to comparable provisions of future laws. Section 1.15 Leased Employee[Reserved] Leased Employee means any person (other than an employee of the recipient) who provides services to the recipient if such services are provided pursuant to an agreement between the recipient and any other person ("leasing organization"), such person has performed such services for the recipient (or for the recipient and any related persons determined in accordance with Code Section 414(n)(6)) on a substantially full-time basis for a period of one (1) year, and such services are performed under the primary direction or control of the recipient. A Leased Employee shall be treated as employed by the Employer for purposes of calculating Service even if not eligible for participation in the Plan. Section 1.16 Limitation Year Limitation Year means the twelve (12) month period commencing on July 1 and ending on June 30. 4

8 Section 1.17 Normal Retirement Age Normal Retirement Age as determined in Section 6.2. Section 1.18 Participant Participant means any Employee who becomes a Participant as provided in Article 2. Section 1.19 Plan Plan means the Supplemental Retirement Program for Employees of Chesterfield County Public Schools, formerly the Early Retirement Incentive Plan for Employees of Chesterfield County Schools, as contained herein or as duly amended. Section 1.20 Plan Administrator Plan Administrator means the administrator of the Plan provided for in Article 5. If a Plan Administrator is not so appointed, the Employer shall be deemed to be the Plan Administrator. Section 1.21 Plan Year Plan Year means each twelve (12) month period beginning on July 1 and ending on the following June 30. Section 1.22 Total and Permanent Disability or Totally and Permanently Disabled Total and Permanent Disability or Totally and Permanently Disabled means the total incapacity of a Participant due to bodily injury or physical or mental disease to such an extent as to render it impossible for him to perform his customary or other comparable duties with the Employer as determined by the Plan Administrator on the basis of competent medical advice and such other evidence as the Plan Administrator may deem sufficient in accordance with uniform principles consistently applied. Section 1.23 Trust Agreement Trust Agreement means the agreement entered into between the Employer and the Trustee pursuant to Article 4. Section 1.24 Trustee Trustee means such individual, individuals or financial institution, or a combination of them as shall be designated in the Trust Agreement to hold in trust the assets of the Plan and shall include any successor Trustee to the Trustee initially designated thereunder. 5

9 Section 1.25 Year of Service Year of Service means for any Employee a stated twelve (12) month period during which the Employee is credited with a year of service under the Virginia Retirement System. 6

10 Article 2 Eligibility and Participation Section 2.1 Eligibility for Participation Each Full-Time Regular Employee on July 1, 1995, and each person who becomes a Full-Time Regular Employee after such date and before July 1, 2013, shall become a Participant on his date of employment. Each person who becomes a Participant shall remain a Participant as long as he is entitled to future benefits under the terms of the Plan. An Employee hired or rehired with an effective date on or after July 1, 2013 is not eligible to participate in the SRP Plan. Section 2.2 Eligibility for Benefits Each Participant on July 1, 1995, and each person who becomes a Participant after such date and before July 1, 2013, shall become eligible for benefits provided hereunder provided the Participant meets the following requirements: (a) (b) (c) (d) (e) (f) (g) (h) the Employee is a full-time employee of the Employer retiring from a covered position under the Virginia Retirement System; effective for benefits commencing on or after August 1, 2004, the Employee retires from the Virginia Retirement System as of July 1 of a given year; the Employee has attained at least the age of fifty-five (55), or the age of sixty (60) if hired after 2010, prior to completing the service described in Section 3.1(a); the Employee is not eligible for disability retirement benefits under the Virginia Retirement System; the Employee has completed at least twenty (20) Years of full-time Service with the Employer, or at least fifteen (15) Years of full-time Service but only if the Employee is 65 years of age or greater prior to completing the service described in Section 3.1(a), of which five (5) Years of Service must have been completed immediately prior to retirement; the Employee has completed at least twenty (20) years of service as defined in the Virginia Retirement System; and effective for benefits commencing on or after August 1, 2004, the Employee complies with the break in service requirement set forth in Section 2.5. effective for benefits commencing on or after July 1, 2017, only One Hundred Seventy-Five (175) Participants annually shall become eligible for benefits under the Plan. For each Participant that submits a written application for benefit commencement in accordance with Section 2.3,form expressing an intent to participate the Plan Administrator, or its designee, shall rank the Participants that apply for benefit commencement by age from oldest (highest) to youngest (lowest) and the highest-ranked 175 Participants each year shall become eligible 7

11 to receive benefits under the Plan. In the event of a tie, the Participant who first submitted a written form expressing the intent to participate application for benefit commencement shall become eligible. Participants who are not eligible to commence benefits in a given year will be permitted to apply for benefit commencement in subsequent years. Upon meeting the requirements specified in this Section and upon the completion of the service rendered in a temporary, part-time position classification, as required under Section 3.1, the Participant will attain "Early Retirement Age." Notwithstanding any provision of the Plan to the contrary, in no event shall any period of employment with the Employer after July 1, 2014 by a person who becomes a Participant on or after July 1, 2013 be considered Years of Service for purposes of the Plan. Section 2.3 Participation Each Participant shall be eligible for Plan benefits beginning with the date he first meets the requirements in Section 2.2. In order to commence a benefit, a Participant must submit a written application for benefit commencement to the Plan Administrator, or its designee, at least 90 days prior to the anticipated date of retirement as a Full-Time Regular Employee. Section 2.4 Status of Participant Receiving Benefits A Participant receiving benefits under the Plan shall be considered a temporary, part-time Employee and shall not be considered a Full-Time Regular Employee. Section 2.5 Break in Service Requirement As a condition of receiving benefits under the Plan, effective for benefits commencing on or after August 1, 2004, a Participant shall be required to comply with a break in service period. Such break in service shall occur immediately prior to the commencement of the temporary, part-time period of service required under Section 3.1. During such break in service period, thethe Participant shall not be allowed to perform any services for the Employer, including noncontractualtemporary work assignments, from the VRS retirement date through the break in service. A Participant who fails to comply with the break in service requirement shall no longer be eligible for benefits under the Plan. The break in service requirement for each employment classification is as follows: 10-month employees 11-month employees 12-month employees Calendar month of September Calendar month of August Calendar month of July 8

12 Article 3 EarlySupplemental Retirement Incentive Benefits Section 3.1 EarlySupplemental Retirement Incentive Benefit (a) Upon commencing benefits under the Plan, a Participant shall provide service to the Employer in a temporary, part-time position classification, for the period specified herein below, in the same position as when the Participant was last employed by the Employer as a Full-Time Employee, or in a position no more than two pay grades from the position in which the Employee was last employed as a Full-Time Employee. (1) A Participant shall be required to fulfill all work assignments and obligations associated with the temporary, part-time assignment and work the time period required prior to the end of the fiscal year. A maximum of one day of approved leave per month during the required work period may be granted for unforeseen emergencies. Participants will not be compensated for days remaining unused at the end of the required work period. (2) Participants shall be accountable to the supervisor, building or departmental administrator in all ways applicable to active Employees. (3) A Participant shall be given no credit for days beyond those worked nor for which the Participant is ineligible. (4) Participants may not work for any other VRS covered employer during their SRP work period. (5) A Participant failing to comply with these requirements will be terminated from the SRP program. (b) (c) The Participant shall receive a retirement benefit which shall commence as of the date the Participant commences temporary, part-time employment under the provisions of the Plan. In the event the retirement benefit results in a lower payment than the federal minimum wage rate, the Participant shall be paid at the federal minimum wage rate. while working. In this event, benefit payments shall cease when the total payments after retirement equalbalance of the 175% of final annual compensation. shall be spread equally over the remaining payout period. For a Participant whose period of service required under this Section commences after August 1, 2004, and before July 1, 2017, the amount of the monthly benefit shall equal one-twelfth (1/12) of one hundred and seventy-five percent (175%) of Final Annual Compensation divided by the number of yearsmonths in the payout period. The minimum monthly benefit shall be fifty dollars ($50). One-half of the monthly benefit shall be paid twice a month during the period the Participant is working in a temporary, part-time position, and the monthly benefit shall be paid 9

13 in twelve (12) monthly installments thereafter. The benefit shall be paid for a minimum period of five (5) years. The period of service required to receive benefits under the Plan shall be based on the Participant's employment classification and shall be as follows: 10-MONTH EMPLOYEES The Participant shall provide services to the Employer in a temporary, part-time position classification for all student instructional days during the school year from October through June. The Participant shall not be eligible for overtime or any non-contractualtemporary work assignments or supplements during such period of service. 11-MONTH EMPLOYEES The Participant shall provide services to the Employer in a temporary, part-time position classification for all student instructional days during the school year, as well as any work days in September prior to the beginning of the school year. 11-MONTH EMPLOYEES The Participant shall provide services to the Employer in a temporary, part-time position classification for all student instructional days during the school year, as well as any work days in September prior to the beginning of the school year. The Participant shall not be eligible for overtime or any non-contractualtemporary work assignments or supplements during such period of service. 12-MONTH EMPLOYEES The Participant shall provide services to the Employer in a temporary, part-time classification, up to a maximum of eight (8) hours per day, for all work days from August through June. The Participant shall not be required to perform services during the Spring Break week. The Participant shall not be eligible for overtime or any non-contractualtemporary work assignments or supplements during such period of service. (d) For a Participant whose period of service required under this Section commences after August 1, 2017, the amount of the monthly benefit shall equal one-twelfth (1/12) of one hundred and seventy-five percent (175%) of Final Annual Compensation divided by the number of yearsmonths in the payout period. Onehalf of the monthly benefit shall be paid twice a month during the period the Participant is working in a temporary, part-time position, and the monthly benefit shall be paid in twelve (12) monthly installments thereafter. The payout period shall be a minimum period of seven (7) years unless the period is reduced in accordance with the requirements of Section 3.1(b). The period of service required to receive benefits under the Plan shall be based on the Participant's employment classification and shall be as follows: 10-MONTH EMPLOYEES The Participant shall provide services to the Employer in a temporary, part-time position classification for all student instructional days during the school year from October through June. The Participant shall not be eligible for overtime or any non-contractualtemporary work assignments or supplements during such period of service. 10

14 11-MONTH EMPLOYEES The Participant shall provide services to the Employer in a temporary, part-time position classification for all student instructional days during the school year, as well as any work days in September prior to the beginning of the school year. 11-MONTH EMPLOYEES The Participant shall provide services to the Employer in a temporary, part-time position classification for all student instructional days during the school year, as well as any work days in September prior to the beginning of the school year. The Participant shall not be eligible for overtime or any non-contractualtemporary work assignments or supplements during such period of service. 12-MONTH EMPLOYEES The Participant shall provide services to the Employer in a temporary, part-time classification, up to a maximum of eight (8) hours per day, for all work days from August through June. The Participant shall not be required to perform services during the Spring Break week. The Participant shall not be eligible for overtime or any non-contractualtemporary work assignments or supplements during such period of service. Section 3.2 Disability Benefit Upon the Total and Permanent Disability of a Participant during the period of service required under Section 3.1, such Participant shall receive payment based on pre-retirement salary for the period of service actually worked and no additional benefits shall be payable from the Plan. Section 3.3 Death Benefit Upon the death of a Participant during the period of service required under Section 3.1, such Participant shall receive payment based on pre-retirement salary for the period of service actually worked and no additional benefits shall be payable from the Plan. Section 3.4 Vesting/Extension of Service Requirement a) A Participant shall be fully vested upon the attainment of his Early Retirement Age as specified in Section 2.2. Prior to the completion of the period that the Participant is providing services to the Employer in a temporary, part-time position as provided hereunder, the Participant's benefit shall be paid from the general assets of the Employer. In the event the Participant does not, for any reason, complete the service required under Section 3.1, the benefits provided hereunder shall be forfeited. b) Notwithstanding the preceding sentence, effective forprovisions of 3.4 a), Participants whose period of service required under Section 3.1 is performed in calendar year 2005 or later, in the event the Participant does not complete the service required due to a documented temporary medical condition, the period under which the service required may be completed shall be extended for a period ending not later than the last day of the calendar year during which the required service was to have been completed. The sufficiency of such documentation of temporary medical condition shall be determined by the Plan Administrator at the Plan Administrator's discretion but based on uniform and nondiscriminatory standards. Benefit payments made after the completion of the period 11

15 that the Participant is providing services in a temporary, part-time position shall be made from the Fund. Section 3.5 Election of Payment Option No less than 180 days prior to becoming eligible for benefits provided hereunder, each eligible Employee shall be given a written notice of his eligibility to commence a benefit from the Plan. The notice shall describe, in a manner intended to be understood by the Participant, the terms and conditions of the benefits provided under the Plan which shall include a general explanation of the financial effect of the election or absence of election to participate. A Participant shall make such an election by written requestelections on payment options under Section 3.1 by signed application to the Plan Administrator at least 90 days prior to the anticipated date of retirement as a full-time employee of the Employer or as otherwise determined appropriate by the Plan Administrator. Such election shall be made on forms provided by the Plan Administrator. The Participant shall elect among the options set forth in Section 3.1, and he shall also elect the length of the payment period. After retirement benefit payments have commenced, no future elections or revocations of an option or payout period will be permitted under any circumstances. Section 3.6 Rollover Distributions Notwithstanding any provision of the Plan to the contrary that would otherwise limit a Distributee's election under this Article, a Distributee may elect, at the time and in the manner prescribed by the Employer, to have any portion of an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan specified by the Distributee in a Direct Rollover. (a) Definitions. (i) An Eligible Rollover Distribution is 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: 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 (10) years or more; and any distribution to the extent such distribution is required under IRC Section 401(a)(9). For purposes of the preceding sentence, a portion of a distribution shall not fail to be an Eligible Rollover Distribution merely because the portion consists of after-tax employee contributions which are not includible in gross income. However, such portion may be paid only to an individual retirement account or annuity described in IRC Section 408(a) or (b), or to a qualified defined contribution plan described in Section 401(a) or 403(a) that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible. 12

16 (ii) (iii) (iv) An Eligible Retirement Plan is an individual retirement account described in IRC Section 408(a), an individual retirement annuity described in IRC Section 408(b), an annuity plan described in IRC Section 403(a), a qualified trust described in IRC Section 401(a), an eligible deferred compensation plan described in IRC Section 457(b) which is maintained by an eligible employer described in IRC Section 457(e)(1)(A), or an annuity contract described in IRC Section 403(b), that accepts the Distributee's Eligible Rollover Distribution. Also, an Eligible Retirement Plan includes a Roth IRA, as defined in IRC Section 408A(b). Distributee: A Distributee means the Employee or former Employee, the Employee's or former Employee's surviving spouse and the Employee's or former Employee's spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in IRC Section 414(p), with regard to the interest of the spouse or former spouse. A Distributee shall include a Beneficiary who at the time of the Employee's death was neither the spouse nor former spouse of the Employee. For such Distributee, a direct rollover is payable only to an individual retirement account or individual retirement annuity (IRA) that has been established on behalf of the Beneficiary as an inherited IRA (within the meaning of IRC Section 408(d)(3)(C)). Direct Rollover: A Direct Rollover is a payment by the Plan to the Eligible Retirement Plan specified by the Distributee. Section 3.7 Disciplinary Action During his temporary, part-time assignment, a Participant shall be required to meet satisfactory performance standards established by the Employer and shall be accountable to the supervisor, building, or departmental administrator in all ways applicable to Full-Time Regular Employees. If dismissed by the Employer during his temporary, part-time assignment, the Participant shall receive payment based on pre-retirement salary only for the period of service actually worked, and no additional benefits shall be payable from the Plan. Section 3.8 USERRA Notwithstanding any provision of this Plan to the contrary, effective December 12, 1994, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with IRC Section 414(u). If a Participant dies while performing qualified military service, as defined under the Uniformed Services Employment and Reemployment Rights Act ("USERRA"), the Participant shall be treated as having died while an active participant in the Plan. However, the Participant will not receive accruals for the period of military leave. In the event the Employer pays differential pay, the differential pay will be included in compensation for purposes of limitations under Code Section

17 Article 4 Funding Section 4.1 Contributions by the Employer The entire cost of benefits under the Plan shall be borne by the Employer. Benefits provided to Participants during the period of service required under Section 3.1 shall be provided from the general assets of the Employer; thereafter, benefits under the Plan shall be provided through the Fund. The Employer will make its Contributions in such actuarially determined amounts as shall be sufficient to provide the benefits of the Plan as may be required by law, provided that the Employer has sufficient funds to meet its obligations hereunder as set forth under applicable law. Funds released through terminations of employment in a fiscal year shall be paid into the Fund in the next fiscal year. Salary savings realized from retirements in a fiscal year shall be paid into the Fund in the next fiscal year. AdditionallyFurthermore, the Employer shall make an annual contribution to the Fund from year-end surplus balances above $3.0 million (after set-asides for encumbrances and planned debt service reserves). The annual contribution amount shall be equal to $2.0 million unless the year-end surplus balance is less than $5.0 million in which case the Employer shall make an annual contribution to the Fund equal to the amount of year-end surplus exceeding $3.0 million. Any deviation from this contribution will be considered a Plan amendment that must be approved by the Chesterfield County Board of Supervisors. Contributions shall be made to ensure a funded ratio of 80% no later than So long as the funded ratio of at least 80% is obtained and maintained, this contribution can be discontinued. This contribution shall be reinstated, however, if the funded ratio ever falls below 80% and shall continue until the 80% funding ratio is again obtained and maintained. In addition to the provisions of this Section 4.1, if the Employer fails for any reason to make a contribution described in this section, or elsewhere in this Plan, the Chesterfield County Administrator shall withhold and adjust appropriations to the Employer in a sufficient amount so that the Chesterfield County Administrator can make the contribution. Section 4.2 Trust Fund The Employer shall enter into an agreement with the Trustee (the Trust Agreement) whereunder the Trustee will receive, invest and administer as a trust fund all Contributions made under this Plan in accordance with the Trust Agreement.. The provisions of such Trust Agreement are incorporated by reference as a part of the Plan, and the rights of all persons hereunder are subject to the terms of the Trust Agreement. The Trust Agreement specifically provides, among other things, for the investment and reinvestment of the Fund and the income thereof, management of the Fund, responsibilities and immunities of the Trustee, removal of the Trustee and appointment of a successor, accounting by the Trustee and disbursement of the Fund. 14

18 Article 5 Fiduciaries and Administration of the Plan Section 5.1 General Each Fiduciary who is delegated specific duties or responsibilities under the Plan or any Fiduciary who assumes such a position with the Plan shall discharge his duties solely in the interest of Participants and Beneficiaries and for the purpose of providing such benefits as stipulated herein to such Participants and Beneficiaries. In carrying out such duties and responsibilities, each Fiduciary shall act with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in exercising such authority or duties. A Fiduciary may serve in more than one Fiduciary capacity and may employ one or more persons to render advice with regard to his Fiduciary responsibilities. If a Fiduciary is serving as such without compensation, all expenses reasonably incurred by such Fiduciary shall be reimbursed by the Employer or, at the Employer's direction, from the Fund, provided that the Fund has sufficient funds to meet its obligations hereunder as set forth under applicable law. A Fiduciary may delegate any of his responsibilities for the operation and administration of the Plan. In limitation of this right, a Fiduciary may not delegate any responsibilities as contained herein relating to the management or control of the Fund except through the employment of an investment manager as provided in Section 5.3 and in the Trust Agreement. Section 5.2 Employer Responsibilities The Employer established and maintains the Plan for the benefit of its Employees and of necessity retains control of the operation and administration of the Plan. In accordance with specific provisions of the Plan, the Employer has, as herein indicated, delegated certain of these rights and obligations to the Trustee and Plan Administrator and these parties shall be responsible solely for these delegated rights and obligations. The Employer shall supply such full and timely information for all matters relating to the Plan as the Plan Administrator, Trustee, member of the Administrative Committee, Chesterfield County Administrator, or any actuary, investment manager, or accountant engaged under the Plan, may request for the effective discharge of their respective duties. Section 5.3 Trustee Although the Trustee, in accordance with the Trust Agreement, has authority and discretion to manage and control the Fund, the Employer shall retain an investment manager to direct the Trustee with respect to the assets comprising the Fund and to advise the Administrative Committee. The Employer shall also retain an actuary to review and make recommendations concerning the Plan and the actuarial assumptions governing the Plan established by the Administrative Committee and the Plan Administrator.. 15

19 Section 5.4 Plan Administrator The Employer shall appoint a Plan Administrator to hold office during the pleasure of the Employer. No compensation shall be paid from the Fund to the Plan Administrator for service as Plan Administrator. The Chesterfield Superintendent of Schools shall appoint a committee of six (6) persons, three of whom shall be selected by the County Administrator with one of the three being a citizen with investment or banking experience. Such committee shall be known as the Administrative Committee and shall, at a minimum, have delegated such duties and discretionary authority as specified herein. No compensation shall be paid from the Fund to members of the Administrative Committee for service on such Administrative Committee. In the event an Administrative Committee is appointed, the Administrative Committee shall choose from among its members a chairman and a secretary. Any action of the Administrative Committee shall be determined by the vote of a majority of its members. Either the chairman or the secretary may execute any certificate or other written direction on behalf of the Administrative Committee. The Administrative Committee shall, at a minimum: (a) (b) (c) (d) (e) (f) compute and certify to the Employer at least annually the sums of money necessary and the sums of money desirable to be contributed to the Fund, consult with the Employer regarding the short-and-long- term liquidity needs of the Plan in order to exercise appropriate investment discretion, determine, in accordance with professional standards, appropriate actuarial assumptions (including, but not limited to, investment return (interest or discounted rate) recommended by a professional actuary by reference to i) the average annual return of the fund over 10 or more years, ii) peer comparison with comparable plans, and iii) future investment return expectations as determined by a professional investment advisor; administrative and investment expenses; annual salary growth; retirement rates; rates of withdrawal (turnover); and mortality rates using standard actuary-selected mortality tables) which will govern whether contributions are adequate and appropriate, advise the Employer on appropriate investment decisions and strategies to protect the sustainability of the Plan, assist the Plan Administrator in reporting to the Employer and the Chesterfield County Board Supervisors, at least annually, on the financial health of the Plan which report shall make recommendations concerning necessary and advisable financial contributions to the Plan; and assist the Plan Administrator in developing and updating, at least annually, an overall funding plan for the Plan, which will be submitted at least annually to the Employer and the Chesterfield County Administrator. In accordance with the provisions hereof, the Plan Administrator has been delegated certain administrative functions relating to the Plan with the duty and discretionary authority necessary to enable it properly to carry out such duties. The Plan Administrator shall have no power in any way to modify, alter, add to or subtract from, any provisions of the Plan. The Plan Administrator 16

20 shall have the duty and discretionary authority to construe the Plan and to determine all questions that may arise thereunder relating to (a) the eligibility of individuals to participate in the Plan, (b) the amount of retirement benefit or other benefits to which any Participant may become entitled hereunder, and (c) any situation not specifically covered by the provisions of the Plan. All disbursements by the Trustee, except for the payment of operating expenses of the Plan and Fund at the direction of the Employer as provided in Section 8.11, shall be made upon, and in accordance with, the written directions of the Plan Administrator. When the Plan Administrator is required in the performance of its duties hereunder to administer, construe or reach a determination under any of the provisions of the Plan, it shall do so on a uniform, equitable and nondiscriminatory basis. The Plan Administrator shall establish rules and procedures to be followed by Participants in filing applications for benefits and for furnishing and verifying proofs necessary to establish age, Years of Service, Final Annual Compensation, and any other matters required in order to determine their rights to benefits in accordance with the Plan. Section 5.5 Claims for Benefits All claims for benefits under the Plan shall be submitted to the Plan Administrator, which shall have the responsibility for determining the eligibility of any Participant for benefits. All claims for benefits shall be made in writing and shall set forth the facts which such Participant (the "applicant") believes to be sufficient to entitle him to the benefit claimed. The Plan Administrator may adopt forms for the submission of claims for benefits, in which case all claims for benefits shall be filed on such forms. The Plan Administrator shall provide applicants with all such forms. Upon receipt by the Plan Administrator of a claim for benefits, it shall determine all facts which are necessary to establish the right of an applicant to benefits under the provisions of the Plan and the amount thereof as herein provided. The Plan Administrator shall either approve or deny a claim and shall investigate all questionable claims. Upon request, the Plan Administrator shall afford any applicant the right of a hearing with respect to any finding of fact or determination related to any claim for benefits under the Plan. If any claim for benefits is denied, the applicant shall be notified of such decision in accordance with the provisions of Section 5.6. Section 5.6 Claims Procedures The applicant shall be notified in writing of any adverse decision with respect to his claim within ninety (90sixty (60) days after its submission. The notice shall be written in a manner calculated to be understood by the applicant and shall include: (a) (b) (c) The specific reason or reasons for the denial; Specific references to the pertinent Plan provisions on which the denial is based; A description of any additional material or information necessary for the applicant to perfect the claim and an explanation why such material or information is necessary; and 17

21 (d) An explanation of the Plan's claim review procedures. If special circumstances require an extension of time for processing the initial claim, a written notice of the extension and the reason therefor shall be furnished to the applicant before the end of the initial ninety (90sixty (60) day period. In no event shall such extension exceed ninety (90) days. If a claim for benefits is denied or the applicant has no response to such claim within ninety (90sixty (60) days of its submission (in which case the claim for benefits shall be deemed denied), the applicant or his duly authorized representative, at the applicant's sole expense, may appeal the denial to the Plan Administrator within sixty (60thirty (30) days of the receipt of written notice of the denial or sixty (60thirty (30) days from the date such claim is deemed denied. In pursuing such appeal, the applicant or his duly authorized representative may: (e) (f) (g) request in writing that the Plan Administrator review the denial; review pertinent documents; and submit issues and comments in writing. The decision on review shall be made within sixty (60thirty (30) days of receipt of the request for review, unless special circumstances require an extension of time for processing, in which case a decision shall be rendered as soon as possible but not later than one hundred twenty (120sixty (60) days after receipt of the request for review. If such an extension of time is required, written notice of the extension shall be furnished to the applicant before the end of the original sixty (60thirty (30) day period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Plan Administrator expects to render the decision on review. The decision on review shall be made in writing, shall be written in a manner calculated to be understood by the applicant, and, if the appeal is denied, shall include: (h) (i) (j) Section 5.7 the specific reason or reasons for the denial; specific references to the pertinent Plan provisions on which the denial is based; and a statement that the applicant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the applicant's claim for benefits. Records/Reports All acts and determinations of the Plan Administrator shall be duly recorded, and all such records and other documents as may be necessary in exercising its duties under the Plan shall be preserved in the custody of the Plan Administrator. Such records and documents at all times shall be open for inspection to, and for the purpose of making copies by, any person designated by the Employer or the Chesterfield County Administrator, to the extent permitted by law. The Plan 18

22 Administrator shall provide such timely information, resulting from the application of its responsibilities under the Plan, as needed by the Trustee, actuary and accountant, if any, engaged on behalf of the Plan by the Employer for the effective discharge of their respective duties. The Plan Administrator shall submit, at least annually, to the Employer, the Chesterfield County Board of Supervisors, the Chesterfield County Administrator, and the Audit and Finance Committee, reports describing the financial health of the Plan, including the financial forecast for the Plan; contributions both which must be made and also which it would be advisable to make to the Fund in order to achieve and sustain the Plan at a minimum funded ratio of 80%; the performance of the Plan and the Fund as compared to projections and expectations contained in the previous year s financial forecast; and any other information which should be reported in order to provide a complete description of the financial health of the Plan. Section 5.8 Missing Persons The Plan Administrator shall make a reasonable effort to locate all persons entitled to benefits under the Plan; however, notwithstanding any provision in the Plan to the contrary, if after a period of five (5) years from the date such benefit is due, any such person entitled to benefits has not been located, his rights under the Plan shall be forfeited. Before this provision becomes operative, the Plan Administrator shall send a certified letter to such person at his last known address advising him that his interest or benefits under the Plan shall be forfeited. However, if a person subsequently makes a valid claim with respect to such forfeited benefits, his right to benefits shall be reinstated. Section 5.9 Audits The Chesterfield County Internal Auditor shall have access to all records of the SRP Program, upon request for such records to the Plan Administrator, in order to conduct audits of the SRP Program. 19