Resolution No. 6300180
RESOLUTION NO. 6300
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CYPRESS AUTHORIZING
ADOPTION OF A SUPPLEMENTAL RETIREMENT PLAN (SRP)
WHEREAS, the City Council finds it to be in the fiscal interest of the City of Cypress
and its employees to consider the provision of a Supplemental Retirement Plan to eligible
employees who wish to voluntarily exercise their option to separate from City service; and
WHEREAS, the City of Cypress is a member of the Public Agency Retirement
System (PARS) Trust for the purpose of providing tax qualified retirement benefits; and
WHEREAS, the PARS Trust has made available a Supplementary Retirement Plan
(SRP), supplementing CaIPERS and qualifying under the relevant sections of the Internal
Revenue Code and the California Government Code.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Cypress
does hereby resolve as follows:
Section 1. The City Council does hereby adopt the PARS Supplemental
Retirement Plan (SRP), as described in Exhibit A to this Resolution, effective April
10, 2012.
Section 2. The Supplementary Retirement Plan must have sufficient plan
participation to meet the City's fiscal, managerial and operational objectives. If the
objectives are not reached, the City may withdraw the retirement incentive. If the
City withdraws the incentive as to some or all eligible employees, all resignations
of employees from whom the offer was rescinded will be automatically revoked;
and
Section 3. City Council hereby appoints the City Manager or his designee as the
City's Plan Administrator for the PARS Supplementary Retirement Plan; and
Section 4. City's Plan Administrator is hereby authorized to execute the PARS
legal and administrative documents on behalf of the City and to take whatever
additional actions are necessary to maintain the City's participation in PARS and to
maintain PARS compliance of any relevant regulation issued or as may be issued;
therefore authorizing the City Manager to take whatever additional actions are
required to administer the City's PARS plan(s). In addition, if the City's Plan
Administrator finds that the PARS supplemental plan benefits must be limited
under Section 415 of the Internal Revenue Code, then the Plan Administrator will
implement replacement benefit programs at no additional cost to the City.
PASSED AND ADOPTED by the City Council of the City of Cypress at a regular
meeting held on the 9th day of April, 2012.
ATTEST:
h_opic &11
CITY CLERK OF THE CITY OF CYPRESS
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS
M YOR OF THE `Y OF CYPRESS
I, DENISE BASHAM, City Clerk of the City of Cypress, DO HEREBY CERTIFY that
the foregoing Resolution was duly adopted at a regular meeting of the said City Council
held on the 9th day of April, 2012, by the following roll call vote:
AYES: 4 COUNCIL MEMBERS: Mills, Seymore, Narain, and Bailey
NOES: 1 COUNCIL MEMBERS: Luebben
ABSENT: 0 COUNCIL MEMBERS: None
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CITY CLERK OF THE CITY OF CYPRESS
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Exhibit A to the Resolution
City of Cypress PARS Supplemental Retirement Program Description
1.0 Eligibility
1.1 Those Miscellaneous and non - Safety employees in the following employee
associations:
• Executive /Mid- Management (Unrepresented)
o City Manager excluded from participation
• Confidential Employees (Unrepresented)
• Cypress Employees Association (CEA)
a) Are employed by the City as of April 9, 2012.
b) Are at least fifty (50) years of age as of June 30, 2012.
c) Have at least five (5) years of City service as of June 30, 2012.
d) Resign from City employment no later than June 30, 2012.
e) Retire under CaIPERS effective no later than July 1, 2012.
2.0 Participation Requirement
2.1 Participating employees shall submit all required PARS enrollment materials and
City Letter of Resignation to PARS on or before the deadline date of May 25,
2012. Resignations of participants are irrevocable as of the enrollment deadline
and may not be rescinded unless the City withdraws the incentive pursuant to
Paragraph 2.2 below.
2.2 An employee's participation in the Plan must meet the City's financial and
managerial objectives in order for the employee's participation to be approved by
the City. If after the close of the enrollment window the City determines that the
employee's participation in the Plan does not meet the City's financial and
managerial objectives, the City may withdraw the incentive for that employee,
provided it notifies that employee of the withdrawal of the employer's participation
on or before June 11, 2012. If the City withdraws the incentive for an employee,
that employee's resignation will be automatically rescinded. After the May 25,
2012 deadline, if the incentive is approved for an employee, that employee's
participation in the incentive and resignation from City employment is locked in
and may not be rescinded.
2.3 Participation in the retirement incentive requires:
a) Submission of required PARS enrollment materials and City Letter of
Resignation to PARS by May 25, 2012.
b) Resignation from City employment effective no later than June 30,
2012.
c) Retirement from PERS on or before July 1, 2012.
3.0 Incentive Payments
3.1 Regarding the basic incentive under this plan:
a) The basic, unmodified benefit shall be a monthly cash payment for the
lifetime of the participant.
b) The monthly cash payment amount shall equal one - twelfth (1/12) of
seven percent (7 %) of final base pay.
c) For purposes of this Plan, final pay shall be defined as the employee's
current base annual salary as of April 9, 2012.
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3.2 Alternative monthly forms of payment of equivalent present value to the basic
benefit shall be offered. They shall include:
a) Joint -and survivor payments;
b) Payments made for the life of the participant, subject to a ten year
minimum; and
c) Fixed term payments of from five (5) to fifteen (15) years. These
payments are guaranteed to the participant for the full term selected.
3.3 The amount of monthly payment shall be fixed as of May 25, 2012 and shall not
be subject to increase thereafter.
3.4 The choice of form of payment (and the choice of payment beneficiary if choosing
a joint and survivor form of payment) shall become final as of May 25, 2012 and
shall not be subject to change thereafter.
3.5 PARS benefits are to commence August 1, 2012, retroactive to July 1, 2012.
4.0 Contract Administrator
4.1 The Contract Administrator for the Retirement Incentive shall be PARS.
4.2 In the event the Plan is cancelled due to insufficient participation, the employer
shall pay Phase II Systems /PARS a one -time fee of $5,000.
4.3 The fee for Phase II Systems /PARS shall be 5.5% of plan contributions to the
PARS Trust for services related to the Supplemental Retirement Plan.
Projected Timeline (Estimated)
1. City Council approval of PARS incentive
2. Enrollment packets mailed to employees' home
3. Employee orientation meeting & workshop
4. PARS hold individual benefit counseling
5. Enrollment window closes
6. City receives post - analysis
7. City announces whether plan goes forward
8. Employees resign from City employment
9. Employees retire under CaIPERS
10. Benefits commence
April 9, 2012
Mid - April, 2012
Late - April, 2012
Mid -May, 2012
May 25, 2012
June 8, 2012
June 11, 2012
June 30, 2012
July 1,2012
August 1, 2012
(Retro to July 1, 2012)
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