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HomeMy WebLinkAbout09-219 - Resolutions RESOLUTION NO. 09-219 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA ESTABLISHING A VOLUNTARY EMPLOYEES BENEFICIARY ASSOCIATION (VEBA) PLAN AND ADOPTING THE PLAN DOCUMENT OF THE CALIFORNIA GOVERNMENT VOLUNTARY EMPLOYEES BENEFIICIARY ASSOCIATION (CALGOVEBA) TOGETHER WITH THE TRUST ESTABLISHED TO HOLD THE ASSETS OF THE PLAN FOR THE BENEFIT OF ELIGIBLE EMPLOYEES. WHEREAS, the City of Rancho Cucamonga wishes to establish a comprehensive integrated program under which the City, other Plan Sponsors, and collective bargaining units can negotiate for a variety of health and welfare benefits for its employees; and, WHEREAS, such comprehensive program, known as California Government Voluntary Employee Beneficiary Association was implemented to effect economies of scale through the pooling of assets for investment purposes and centralizing of administrative services to provide the City of Rancho Cucamonga and other Plan Sponsors with a cost effective vehicle through which to offer benefits to their employees; and, WHEREAS, it is the intent of the City of Rancho Cucamonga to establish a voluntary employees beneficiary association (VEBA) Plan as an integral part of California Government Voluntary Employees Beneficiary Association Trust; and WHEREAS, the City of Rancho Cucamonga will provide for a Trust to hold the funds of the VEBA for the benefits specified in this plan under and in accordance with the Plan; and, WHEREAS, the City of Rancho Cucamonga intends that the Plan hereby established, when taken together with the Trust, shall constitute a Voluntary Employees Beneficiary Association under Section 501 (c )(9) of the Internal Revenue Code of 1986, as amended (the "Code"); NOW, THEREFORE, BE IT RESOLVED, in consideration of the foregoing, the City of Rancho Cucamonga adopt the following Plan, that together with the trust established to hold the assets of the Plan, evidences the Voluntary Employees Beneficiary Association established for the benefits of eligible City employees: - Please see the following page for formal adoption,certification and signatures PASSED, APPROVED, AND ADOPTED this 4h day of November 2009. AYES: Gutierrez, Kurth, Michael, Spagnolo, Williams NOES: None ABSENT: None ABSTAINED: None r� Do ald J. Kurth, MS., Mayor ATTEST: 01 nice C. Reynolds, City Jerk I, JANICE C. REYNOLDS, CITY CLERK of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, California, at a Regular Meeting of said City Council held on the 18`h day of November 2009. Executed this 19`h day of November 2009, at Rancho Cucamonga, California. lja/� Z-- Z&Vw&", — J nice C. Reynolds, Cit Jerk Resolution No. 09-219 - Page 2 of 12 Article I Name & Documents 1.1 Nannie. The name of this Plan shall be the California Government VEBA Plan (the "Plan"). It is established pursuant to the provisions of Code Section 501 (c)(9), and together with the Trust adopted'to fund the benefits evidences the Plan Sponsor's intent to form a VEBA. 1.2 Plan Documents. This Plan, together with the Trust Agreement shall constitute the entire Plan. This Plan document together with such documents attached as Schedule A, shall compose the entire plan. Resolution No. 09-219— Page 3 of 12 Article H Definitions 2.1 `Beneficiary": A person or persons who are entitled to receive benefits under the Plan following the death of the Member and who are identified in a form prescribed by the Trust Administrator. 2.2 "Contributions": Amounts deposited in the Trust pursuant to the terms of this Plan. 2.3 `Effective Date': The Effective Date shall be the date the Plan and Trust are adopted by the Plan Sponsor. 2.4 `Employee": Any employee of the Plan sponsor. 2.5 "Individual Account": An account as described in Article VI. 2.6 "Plan Sponsor": Any public agency or political subdivision thereof which has adopted and not terminated a Plan and Trust as part of the California Government VEBA. 2.7 "Member': Any of the following persons who meet the eligibility requirements provided in the Plan: 2.7.1 An actively employed Employee. 2.7.2 An inactive Employee. 2.7.3 A retired former Employee. 2.7.4 A dependent of an active, inactive, or retired Employee who is a Member including the Employee's spouse; a minor child residing with the Employee; a child of the Employee who is a student within the meaning of Code Section 151(e) (4); any other person who is a dependent of the Employee within the meaning of Code Section 152(a). 2.7.5 A beneficiary of an active, inactive or retired Employee who is or was a Member. 2.7.6 "Inactive Employee" means: An Employee who, although not actively employed by the Plan Sponsor, retains eligibility for benefits. 2.9 "Plan Administrator": The individual, position or organization designated by the Trustee to act in matters relating to the administration of the Plan and its Documents. 2.10 "Trust Administrator": The entity appointed by the Trustee to perform the duties listed herein. 2.11 "Ttimee": The Trust Committee appointed by the forming agency Plan Sponsor, or such -other individual or entity as determined pursuant'to the California Government Code. Resolution No. 09-219 —Page 4 of 12 Article III Participation 3.1 Eligibility. 3.1.1 In General. Subject to the limitations of section 3.2, every Employee shall be eligible to become a Member under this Plan at the time of the first Plan Sponsor contribution to this Plan on the Employee's behalf. The Plan Sponsor may contribute to the Plan on behalf of its Employees on terms pursuant to the Plan Sponsor's leave conversion programs, flat rate contribution program, or any other Plan Sponsor sponsored program permitting contributions to the Plan and Trust. 3.2 Limitations. 3.2.1 Participation shall be limited to those Employees by or on behalf of whom a contribution is made to the Trust. 1.2.2 This Plan does not permit any conditionfor eligibility which would limit participation or benefits to officers or highly compensated Employees. 3.3 Procedure. After satisfying all eligibility requirements, an Employee shall participate in this Plan when the Trustee receives the initial contribution for the Member. 3.4 Duration of Participation. Once an Employee becomes a Member in the Plan, his participation shall continue as long as funds remain in or are required to be deposited in his/her Member's Individual Account. 3.5 Voluntary Participation. The participation by an Employee shall be voluntary in accordance with the collectively bargained provisions for member contributions. Such participation shall be governed by the applicable provisions of the Internal Revenue ' Service (IRS). Resolution No. 09-219 —Page 5 of 12 Article rV Plan Benefits 4.1 Description. The purpose of the Plan is to provide health and welfare benefits and similar benefits permitted under section 501 (c)(9) of the Internal Revenue Code, for use during periods of employment, layoff or retirement. Health Benefits may include benefits as defined by Code Section 213 and excludable from income under Code Sections 105 and 106 as amended from time to time. Such benefits may be provided through reimbursement or through the payment of premiums to a medical benefit or health insurance program. Benefits may include payment for services or benefits designed to safeguard or improve the health of Members or clinical care services by visiting nurses, nursing homes and transportation for medical care. Welfare benefits may include, but are not limited to health, severance, unemployment, life and/or education benefits. 4.2 Commencement of Benefits. Benefits commence for covered expenses incurred on or after the date an Employee becomes a Member in the Plan. 4.3 Beneficiaries. Benefits are payable for covered expenses incurred by the Member, the Member's dependents or the Member's Beneficiaries. 4.4 Desienation of Beneficiaries. The Member shall have the sole right to designate the Beneficiary or Beneficiaries eligible to receive any benefit under the Plan. Such designation must be on a form or forms supplied by the Plan Administrator and shall be effective when delivered to the Plan Administrator in accordance with established procedures. 4.5 Termination of Benefits. Benefits for Members shall terminate when there are no longer any assets available for payment. 4.6 Beneficiary Payments Individual Accounts. If an Individual Account is established, in the event of the Member's death, any funds then remaining in.the Member's Individual Account shall be used for medical expenses of the Member's spouse and qualified dependents. 4.7 Unallocated Benefits. The Plan Sponsor may participate in this Plan without establishing Individual Accounts for Members. The Plan Sponsor shall specify the Employees to whom benefits are to be paid, and the amount and type of benefits. The assets contributed for such Employees and earnings thereon shall be accounted for in a separate sub account of the Trust. Benefits shall then be paid to Members as prescribed by the provisions of this Plan and any other instrument that is deemed a part of this Plan for the purpose of determining benefits to be paid. When the assets in such sub account are exhausted no further benefits shall be paid. Resolution No. 09-219 — Page 6 of 12 Article V Funding of Benefits 5.1 Plan Sponsor's Contributions. Plan Sponsor contributions made to this Plan and Trust for medical benefits shall be specifically allocated to an Individual Account for each Member for the purpose of providing payment of the benefits described herein unless the Plan Sponsor is providing for Unallocated Benefits pursuant to Section 4.7. 5.2 Determination of Benefits. Unless the benefits are being provided on an Unallocated Basis pursuant to Section 4.7, amounts contributed on behalf of each Member shall be determined pursuant to the provisions of the collective bargaining agreement and Plan Sponsor personnel practices under which the benefits and compensation to be provided to the Employee under this Plan are determined. If benefits are being provided on an Unallocated Basis benefits shall be determined on the same basis. 5.3 Termination of Plan Sponsor Contributions. Contributions shall cease whP^ the applicable bargaining agreements or Plan Sponsor policies no longer proviae for contributions. The Plan Sponsor shall be responsible for informing the Plan Administrator when Plan Sponsor Contributions for any Employee or Employees will cease. Resolution No. 09-219— Page 7 of 12 Article VI Allocation to Member's Accounts 6.1 Members' Individual Accounts. A separate account shall be maintained by the Plan Administrator for each Member to account for the income, gains, losses, and expenses or benefit payments attributable to his or her account unless benefits are being provided on an Unallocated Basis. 6.2 Receipt of Contributions. Contributions will be credited when received by the Trustee. 6.3 Accounting. The Plan Administrator shall develop such accounting procedures as are deemed appropriate for the accurate reflection of the Members' Individual Account balance or the assets contributed, earnings thereon and benefits paid if benefits are being provided on an Unallocated Basis. Resolution No. 09-219— Pape 8 of 12 Article VII General Provisions 7.1 Source of Benefits. The Plan and Trust's liability to any Member for benefits under the Plan shall be limited to the sum of the contributions made by the Member to his/her Individual Account and/or the amount contribution made by the Plan Sponsor and interest thereon for the specified benefit of said Member if benefits are being provided on an Unallocated Basis. 7.2 Mechanics of Pavment. The Member shall, with respect to any benefit, and subject to the reasonable procedures established by the Plan Administrator, direct the Plan Administrator: 7.2.1 To pay benefits directly to an insurance company for qualified insurance premiums; or 7.2.2 To pay benefits to a Plan Sponsor for qualified Medical premium payments; or 7.2.3 To pay benefits to the Member for reimbursement of qualified medical expenses; or any combination as allowed under the procedures adopted by the Plan Administrator. 7.3 Claims Procedure. At such time when a Member believes he/she is entitled to receive a benefit under the Plan, such Member shall deliver a request for such benefit in writing to the Plan Administrator. The Plan Administrator shall review the claimant's request for a Plan benefit and shall, within a reasonable time thereafter, notify the claimant of its decision as follows: 7.3.1 if the claimant's request for a Plan benefit is approved, the Plan Administrator shall proceed with the distribution of such Plan benefit pursuant to the reimbursement method selected by the Member. 7.3.2 If the claimant's request for a Plan benefit is denied, in whole or in part, by the Plan Administrator, the Plan Administrator shall notify the claimant of such denial and shall provide the claimant with a reasonable procedure for reviely. 7.3.3 Any claimant whose request for Plan benefits has been denied, in whole or in part, may appeal said denial of Plan benefits in accordance with the appeal process established by the Plan Administrator. Such request for review must be delivered to the Plan Administrator within the specified time period after the date the claimant received written notification of the Plan Administrator's initial denial of the claimant's request for Plan benefits. 7.3.4 The Plan .Administrator shall permit the claimant to review pertinent documents and submit written issues and comments concerning the denial of claimant's request for Plan benefits. Resolution No. 09-219— Page 9 of 12 Article V1H Administration 8.1 Trust Administrator. The Trust Administrator of the California Government Voluntary Employees Beneficiary Association Master ("Trust') shall perform such duties as directed by the Trustee and the terms of this agreement. 8.2 Trust Administrator Duties. The Trust Administrator shall have responsibility for maintaining records of the balances, claims, and contributions to the Individual Accounts as well as such records as are needed to maintain the Plan if contributions are made on an Unallocated Basis. The Trust Administrator shall enforce this Plan in accordance with its terms and those of the Trust and shall be charged with the general administration of the Plan. In addition, the Trust Administrator, or its delegatee, shall have the following duties: 8.2.1 to determine all questions relating to the eligibility,of Employees to participate. 8.2.2 to report to the Trustee as directed; 8.2.3 to compute and certify to the Trustee the amount and kind of benefits payable to the Members, their dependants and Beneficiaries; 8.2.4 to maintain all the necessary records for the Administration of this Plan; 8.2.5 to account for the investments made by the Trustee in a manner consistent with the objectives of the Plan and authorized by the Trust; 8.2.6 to make and publish such rules for the regulation of this Plan as are not inconsistent with the terms hereof. 8.3 Information. To enable the Trust Administrator to perform its functions, the Plan Sponsor shall supply it with full and timely information on all matters relating to the compensation of all Employees, their services, their retirements, deaths or the causes for terminations of employment and such other pertinent facts as the Trust Administrator may require. 8.4 Expenses. All expenses shall be paid from the earnings on the assets held in the Trust, unless otherwise authorized by the Trustee. 8.5 Consultants. Advisors & Manaeers. The Trust Administrator may employ such consultants advisors and investment managers as it deems necessary or useful in carrying out its duties hereunder, with the cost thereof to be paid from the Trust assets. Such Consultants, Managers and Advisors are subject to approval by the Trustee. 8.6 Funding Poliev & Procedures. The Trustee, Trust Administrator and Plan Sponsor shall formulate policies, practices and procedw-es for contributions to, payments from, and funding of the Plan, which shall be consistent with the Plan objectives and the provisions of applicable law. Without limiting the generality of the foregoing, the Trust Administrator may, from time to time, accomplish the following: Resolution No. 09-219 — Page 10 of 12 8.6.1 Establish a regular and convenient schedule of planning meetings, not less often than annually. 8.6.2 Review short term, intermediate and long range investment goals. 8.6.3 Determine and project benefit liabilities. 8.6.4 Make plans to satisfy the liquidity needs of the Plan; and 8.6.5 Consult with such other advisors as may be necessary to assure the efficient payment of Plan benefits. 8.6.6 Recommend asset investment models, fund managers and investment options. Resolution No. 09-219 — Page 11 of 12 Article IX Liability 9.1 No Ri . Neither the establishment of this Plan, nor any modification or amendment thereof nor the payment of any benefits, shall be construed as giving any Member, or any person whomsoever, any legal or equitable right against the Trustee, Trust Administrator,Plan Sponsor, or the assets of the Plan. 9.2 Obligations of Plan Sponsor. Only assets in the Trust shall be available to pay the benefits and claims which arise under this Plan. No.obligation of the Plan shall constitute an obligation of the Plan Sponsor,. except as such Plan Sponsor is obligated to make contributions under the Plan. 9.3 Liability Limitation Neither the Trustee, Plan Sponsor or the Trust Administrator shall be liable for the acts or omissions of any Investment Manager or other person appointed to manage the assets of the Plan and Trust if the Trustee or Trust Administrator in appointing such person acted with the care, skill, prudence and diligence under the circumstances stances then prevailing that a prudent man would use in the conduct of an enterprise of a like character and with like aims. Resolution No. 09-219 — Page 12 of 12