Fort Walton Beach Council agenda — 02-08-11 regular — reading text

Retirement Option Plan. Page 46 of 53 Pages  B. " DROP Account" -- The account established for each DROP participant under subsection 3. 2. Partici ation. A. Eligibility to Participate. In lieu of terminating his employment as a Firefighter, any Member who is eligible for normal retirement under the Plan may elect to defer receipt of such service retirement pension and to participate in the DROP. Election to Participate. c A Member's election to participate in the DROP must be made in writing in a a time and manner determined by the Board at least thirty ( 30) days in advance and participation must begin within twelve ( 12) months after 0 Member reachers normal retirement or within twelve ( 12) months from the y date that this provision become adopted, if later. a) a LL UL CO Period of Participation. M a A Member who elects to participate in the DROP under subsection 2. B., shall E M participate in the DROP for a period not to exceed 36 months beginning at 0 the time his election to participate in the DROP first becomes effective. An ti election to participate in the DROP shall be irrevocable and shall constitute M co an irrevocable election to resign from the service of the City not later than the 0 date provided for in the previous sentence. Under no circumstances may a Member continue employment with the City as a firefighter after participating in the DROP for the permissible period ofDROP participation. A Member may participate only once. L 0 Termination of Participation. r e- 1) A Member's participation in the DROP shall cease at the earlier of: M co a) the end of his.permissible period ofparticipation in the DROP as determined under subsection 2. C.; or 0 b) termination of his employment as a Firefighter. a) E 2) Upon the Member's termination of participation in the DROP, s 0 pursuant to subsection ( a) above, all amounts provided for in to subsection 3. B., including monthly benefits or interest, shall cease to a be transferred from the' Plan to his DROP Account. Any amounts remaining in his DROP Account shall be paid to him in accordance with the provisions of subsection 4. when he terminates his employment as a Firefighter. 3) A Member who terminates his participation in the DROP under this subsection 2. D. shall not be permitted to again become a participant in the DROP. Page 47 of53 Pages  E. Effect of DROP Participation on the System Plan. 1) A Member's Credited Service and his accrued benefit under the Plan shall be determined on the date his election to participate in the DROP first becomes effective. The Member shall not accrue any additional Credited Service or any additional benefits under the Plan including any additional benefits provided under any cost -of-living adjustment for Retirees in the Plan) while he is a participant in the DROP. After a Member commences participation, he shall not be permitted to again contribute to the Plan, the City shall not continue to contribute to the Plan on his behalf for future accruals, nor shall he be eligible for disability or pre- retirement death benefits. 2) No amounts shall be paid to a Member from the Plan while the a Member is a participant in the DROP. If a Member's participation in the DROP is terminated other than by terminating his employment as 0 a Firefighter, no amounts shall be paid to him from the Plan until he as terminates his employment as a Firefighter. Amounts transferred a from the Plan to the Member's DROP Account shall be paid directly LL U. to the Member only on the termination of his employment as a Firefighter. a E M 3. Funding. 0 ti A. Establishment of DROP Account. M co r as A DROP Account shall be established for each Member participating in the v DROP. A Member's DROP Account shall consist of amounts transferred to cc the DROP under subsection 3. B., and earnings or interest on those amounts. L o B. Transfers From Retirement m Plan. 1) As of the first day of each month of a Member's period of participation in the DROP, the monthly retirement benefit he would ti have received under the Plan had he terminated his employment as a M 00 Firefighter and elected to receive benefit payments monthly thereunder shall be transferred to his DROP Account, except as otherwise provided for in subsection 2. D.( 2). A Member's period of 0 participation in the DROP shall be determined in accordance with the 4) provisions of subsections 2. C. and 2. D., but in no event shall it E continue past the date he terminates his employment as a Firefighter. s 2) Except as otherwise provided in subsection 2. D.( 2), during a at Member' s participation in the DROP, the Member' s monthly retirement benefit will be paid into the DROP account. The Member' s DROP account will increase in value at a rate equal to one -half ( 50 %) of the assumed rate of return on pension fund investments during the immediately preceding plan year. The interest rate on the DROP account will be established by the pension board as of February I each year. The interest rate may be adjusted up or down during a Member' s participation in the DROP, which will result in a change in the prospective interest rate credit on the Member' s DROP account. Page 48 of 53 Pages  3) A Member's DROP Account shall only be credited with interest and monthly benefits while the Member is a participant in the DROP. A Member's final DROP account value for distribution to the Member upon termination of participation in the DROP shall be the value of the account at the end of the quarter immediately preceding termination of participation plus any monthly periodic additions made to the DROP account subsequent to the end of the previous quarter and prior to distribution. Distribution of DROP Accounts on Termination of Employment. A. Eligibility for Benefits. c A Member shall receive the balance in his DROP Account in accordance M a with the provisions of this subsection 4. upon his termination of employment c as a Firefighter. Except as provided in subsection 4.D., no amounts shall be 0 paid to a Member from the DROP prior to his termination of employment as c a Firefighter. CL B. Form of Distribution. 1) Distribution of the Member' s DROP Account