COUNTY OF SANTA CRUZ

Transcription

1 COUNTY OF SANTA CRUZ PARS Accumulated Leave Conversion Plan (ALP) Defined Benefit Effective July 1, 2004 Plan Summary Public Agency Retirement Services (PARS)

2 TABLE OF CONTENTS INTRODUCTION...3 ELIGIBILITY FOR ALP BENEFIT...4 ALP BENEFIT DESCRIPTION...5 HOW TO RECEIVE BENEFITS UNDER THE PLAN...7 FOR ADDITIONAL INFORMATION...7 2

3 INTRODUCTION The information in this packet is designed to provide a general description of what you can expect as a participant in the County of Santa Cruz PARS Accumulated Leave Conversion Plan (ALP) (the Plan ). The Plan Document contains a more detailed description, and your employer has a copy that you may read. The Plan Document shall govern if this description states something different. Background The County of Santa Cruz approved the establishment of a PARS ALP for eligible County of Santa Cruz employees, effective July 1, The Plan provides a supplemental retirement benefit in addition to your current CalPERS retirement benefit. Plan Sponsor PARS ALP has been established by your employer, the County of Santa Cruz (the County ). Plan Administrator The County has appointed a Plan Administrator who is responsible for taking the necessary actions to implement and administer the Plan in compliance with the Plan and applicable legal requirements. The Plan Administrator is the County Administrative Officer. Public Agency Retirement System (PARS) PARS is a 401(a) tax-qualified multiple employer trust. PARS is made up of California governmental agencies such as school districts, community colleges, cities, counties, and other special districts. The County has implemented the Accumulated Leave Conversion Plan through PARS. 3

4 PARS Trustee Union Bank of California is the Trustee for PARS. The duties of the Trustee include receiving and investing Plan contributions, safeguarding Plan assets, and distributing benefits to eligible Plan participants or beneficiaries at the direction of the Plan Administrator and pursuant to the Plan Document. Union Bank of California will invest plan assets in accordance with the investment strategy selected by the County of Santa Cruz. PARS Trust Administrator Public Agency Retirement Services is the Trust Administrator for the PARS Trust. The Trust Administrator s functions include Plan accounting, coordinating benefit distributions with the Trustee, and communicating Plan provisions. ELIGIBILITY FOR ALP BENEFIT You are eligible to receive benefits under this Plan if you meet all of the following requirements. You must: (a) Be employed as a Local Sheriff Member, County Peace Officer or Miscellaneous member of the County of Santa Cruz on or after July 1, 2004; (b) Have a balance of at least two hundred (200) hours of Accumulated Leave at the time of termination; (c) Irrevocably elect to participate in the Plan by completing and submitting to the County an Election Form at least ninety (90) days prior to termination; (d) Have terminated employment with the County; and (e) Have applied for benefits under this Plan. 4

5 ALP BENEFIT DESCRIPTION Benefit Description Employees who meet the eligibility requirements for the PARS ALP shall receive a lump sum amount equal to: Elected Percentage x Accumulated Leave Hours x Hourly Base Pay Elected Percentage is defined as the percentage irrevocably specified in the employee s completed Election Form. The percentages available are 10% - 100%, at 10% increments. The Employee Contribution is a pre-tax contribution (after FICA has been deducted). Accumulated Leave Hours is defined as the employee s accumulated unused annual leave, vacation leave, sick leave, compensatory time leave and administrative leave eligible for conversion pursuant to the County s Memorandum of Understanding. Hourly Base Pay is defined as the employee s hourly base pay at the time of termination with the County. Benefit Payment Options If an employee s accumulated leave conversion is less than $5,000 at the time of termination, the employee shall be paid in the Lump-Sum Cash Option only. Participants have the option of receiving payments as follows: Lump-Sum Cash Option: a one-time lump-sum payment. This option is subject to a fee equal to $25.00 plus 0.12% of total leave balance. If you elect this option and are under age 55, in addition to the regular income tax, you may have to pay an extra tax equal to 10% of the table portion of the payment. Please consult your own tax consultant for further information. Lump-Sum Rollover Option: a one-time lump-sum payment rolled over into a traditional IRA or to an eligible employer plan that accepts the rollover. This option is subject to a fee equal to 3.0% of total leave balance. 5

6 Option 1* (Lifetime): a monthly cash payment for your lifetime. This option does not pay out to a beneficiary. This option is subject to a fee equal to 3.0% of total leave balance. Option 2* (Joint-and-100% Survivor): a modified monthly lifetime payment; upon your death, the payment continues at the same level for the lifetime of your named beneficiary; upon your beneficiary s death, the payment ends. This option is subject to a fee equal to 3.0% of total leave balance. Options 5-15* (Fixed Payment): the fixed payment options provide higher monthly payments, but for a fixed period of time, ranging from 5-15 years; upon your death, if you have not received all of the payments due, payments will continue to your beneficiary or estate until the total number of payments have been received. These options are subject to a fee equal to 3.0% of total leave balance. Options 5-9 are eligible for rollover into a traditional IRA or to an eligible employer plan that accepts the rollover. If you elect one of the Options 5-9 and do not elect a direct rollover and are under age 55, in addition to the regular income tax, you may have to pay an extra tax equal to 10% of the table portion of the payment. Please consult your own tax consultant for further information. *The monthly benefit amounts for Options 1, 2, & 5-15 will be based on projected annuity rates at the time you apply for benefits. If you elect one of these options, the amount of your benefit may be adjusted up or down from the amount originally illustrated to you prior to your first distribution based on the most current annuity rates at the time of purchasing the annuity. Example: Hours of Accumulated Leave = 500 hours Hourly Pay Rate = $20.00 Elected Percentage = 80% 80% x 500 hours x $20.00 = $8, $8, Lump Sum Payment (less FICA) (less the applicable fee based on Option choice) 6

7 HOW TO RECEIVE BENEFITS UNDER THE PLAN One pay period prior to termination from County employment, you must contact the Payroll Supervisor in the Auditor Controller s office and notify them of your termination date and participation in the plan. After your termination from County employment: 1. The County will submit to PARS a Request for ALP Distribution Form with your final accumulated leave conversion. 2. PARS will mail you a customized ALP enrollment packet. 3. Return the completed enrollment packet to PARS to begin receiving a distribution from the Plan. The first payment will be made the first of the month after PARS receives your completed enrollment packet (or as soon as administratively possible), and if applicable, will be paid retroactive to the first of the month following your County termination date. FOR ADDITIONAL INFORMATION Additional questions about the Plan should be directed to PARS. PARS Attention: Plan Enrollments Department 5141 California Avenue, Suite 150 Irvine, CA (800) enrollments@parsinfo.org PARS is not licensed to provide tax, accounting or legal advice. You are urged to consult with appropriate professionals regarding the tax, accounting and legal implications of participating in PARS. 7