1276RECITALS:
RESOLUTION NO.1276
A RESOLUTION OF THE CITY OF MOSES LAKE,WASHINGTON,
ESTABLISHING A DEFERRED COMPENSATION PLAN ADMINISTERED BY
THE I.CM.A.RETIREMENT CORPORATION
1.The City of Moses Lake has employees rending valuable services.
2.The establishment of a deferred compensation plan for the city's exempt
I—'employees in addition to the currently established deferred compensation
plan now available to all city employees will serve the interest of the
employer by enabling it to provide reasonable retirement security for its
exempt employees,by providing increased flexibility in its personnel
management system,and by assisting in the attraction and retention of
competent personnel.
3.The employer has determined that the establishment of a deferred compen
sation to be administered by the I.CM.A.Retirement Corporation will
serve the above objections.
4.The employer desires that the investment of some of its funds contributed
to by the exempt employees and held under its deferred compensation plan
be administered by the I.CM.A.Retirement Corporation,as trustee,with
the understanding that such funds so invested will be held by the
I.CM.A.Retirement Trust,a trust established by public employers for
the purpose of representing the interests of such employers with respect
to the collective investment of funds held under their deferred compensa
tion plans.
RESOLVED:
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1.The employer adopts the deferred compensation,attached hereto as Appen
dix A,and appoints the I.CM.A.Retirement Corporation to serve as Ad-
*—'ministrator hereunder.
2.That the employer hereby executes the I.CM.A.Retirement Trust,attached
hereto as Appendix B.
3.That the employer hereby adopts the trust agreement,attached hereto as
Appendix C,and appoints the I.CM.A.Retirement Corporation as trustee
hereunder,and directs the I.CM.A.Retirement Corporation,as trustee,
to invest all funds held under the deferred compensation plan through the
I.CM.A.Retirement Corporation as soon as is practicable.
4.That the Finance Director shall be coordinator for this program and he
shall receive necessary reports,notices,etc.from the I.CM.A.Retire
ment Corporation as Administrator,and shall cast,on behalf of the em
ployer,any required votes under the program.Administrative duties to
carry out the plan may be assigned to the appropriate departments.
Adopted by the City Council on August 12,1986
/Mayor
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ATTEST
City Clerk
(APPENDEX "A"ATTACHED
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APPENDIX A
("EMPLOYER")
DEFERRED COMPENSATION PLAN
Li
I.INTRODUCTION
The Employer hereby establishes the Employer's Deferred
Compensation Plan,hereinafter referred to asthe"Plan."The Plan
consists of the provisions set forth in this document.
The primary purposeof this Plan isto provide retirement income
and other deferred benefits to the Employees of the Employer in
accordance with the provisions of section 457 of the Internal
Revenue Code of 1954,as amended.
This Plan shall be an agreement solely between the Employer
and participating Employees.
II.DEFINITIONS
2.01 Account:The bookkeeping account maintained for each
Participant reflecting the cumulative amount of the
Participant's Deferred Compensation,including any income,
gains,losses,or increases or decreases in market value
attributable to the Employer's investment of the Participant's
Deferred Compensation,and further reflecting any distribu
tions to the Participant or the Participant's Beneficiary and
any fees or expenses charged against such Participant's
Deferred Compensation.
2.02 Administrator The person or persons named to carry out
certain nondiscretionary administrative functions under the
Plan,as hereinafter described.The Employer may remove
any person as Administrator upon 60 daysadvance notice in
writing to such person,in which case the Employer shall
name another person or personstoactasAdministrator.The
Administrator may resign upon 60 days advance notice in
writing to the Employer, in which the case the Employershall
name another person or persons to act as Administrator.
2.03 Beneficiary:The person or persons designated by the
Participant in hisJoinder Agreementwho shall receiveany
benefits payable hereunder in the event of the Participant's
death.
2.04 Deferred Compensation:The amount of Normal Compensa
tion otherwise payable to the Participant which the
Participant and the Employer mutually agree to defer
hereunder,anyamountcreditedtoaParticipant'sAccountby
reason of a transfer under Section 6.03.or any other amount
which the Employer agrees to credit to a Participant's
Account.
2.05 Employee:Any individual who provides services for the
Employer,whetheras anemployee ofthe Employer orasan
independent contractor,andwhohasbeendesignatedbythe
Employer as eligible to participate in the Plan.
2.06 Includible Compensation:The amount of an Employee's
compensation from the Employer for a taxable year that is
attributabletoservicesperformedforthe Employer andthat
is includiblein the Employee'sgross income for the taxable
year for federal income tax purposes; such term does not
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include anyamount excludable from gross income underthis
Plan or any other plan described in section 457(b)of the
Internal Revenue Code,any amount excludable from gross
income under section 403(b)of the Internal Revenue Code,
or any other amount excludable from gross income for
federal income tax purposes.Includible Compensationshall
be determined without regard to any community property
laws.
2.07 Joinder Agreement:An agreement entered into between an
Employee and the Employer,including any amendments or
modifications thereof.Such agreement shall fix the amount
of Deferred Compensation,specify a preference among the
investment alternatives designated by the Employer,
designate the Employee's Beneficiary or Beneficiaries,and
incorporate the terms,conditions,and provisions of the Plan
by reference.
2.08 Normal Compensation:The amount of compensation which
would be payable to a Participant by the Employer for a
taxable year if no Joinder Agreement were in effect to defer
compensation under this Plan.
2.09 Normal Retirement Age:Age 70,unless the Participant has
elected an alternate Normal Retirement Age by written
instrumentdelivered totheAdministratorpriorto Separation
from Service.A Participant's Normal Retirement Age
determines (a)the latest time when benefits may commence
under this Plan (unless the Participant continues employ
ment after Normal RetirementAge),and(b)the periodduring
which a Participant may utilize the catch-up limitation of
Section 5.02 hereunder.Oncea Participanthas to any extent
utilized the catch-up limitation of Section 5.02,his Normal
Retirement Age may not be changed.
A Participant's alternate Normal Retirement Age may not
be earlier than the earliest date that the Participant will
become eligible to retire and receive unreduced retirement
benefitsunderthe Employer'sbasicretirementplancovering
the Participant and may not be later than the date the
Participant attains age 70. If a Participant continues
employment after attaining age 70, not having previously
elected an alternate NormalRetirementAge,the Participants
alternate Normal Retirement Age shall not be later than the
mandatory retirement age.if any.established by the
Employer,or the age at which the Participant actually
separates from service if the Employer has no mandatory
retirement age. Ifthe Participant will notbecomeeligible to
receive benefits underabasicretirement planmaintained by
the Employer,the Participants alternate Normal Retirement
Agemaynotbeearlierthanattainmentofage55andmaynot
be later than attainment of age 70.
2.10 Participant:Any Employee whohasjoinedthePlanpursuant
to the requirements of Article IV.
2.11 Plan Year:The calendar year.
2.12 Retirement:The first date upon which both of the following
shall have occurred with respect to a Participant:Separation
from Service and attainment of Normal Retirement Age.
2.13 Separation from Service:Severance of the Participant's
employment with the Employer.A Participant shall be
deemed to have severed his employment with the Employer
for purposes of this Plan when,in accordance with the
established practices of the Employer,the employment
relationship is considered to have actually terminated.In the
caseof a Participant who is an independent contractorofthe
Employer.Separation from Service shall be deemed to have
occurred when the Participant's contract under which
services are performed has completely expired and
terminated,there is no foreseeable possibility that the
Employer will renew thecontract orenter into a newcontract
for the Participant's services,and it is not anticipatedthatthe
Participant will become an Employee of the Employer.
III.ADMINISTRATION
3.01 Dutiesof Employer:The Employershall have theauthority to
make all discretionary decisions affecting the rights or
benefits of Participants which may be required in the
administration of this Plan.
3.02 Duties of Administrator The Administrator,as agent for the
Employer,shall perform nondiscretionary administrative
functions in connection with the Plan,including the
maintenance of Participants'Accounts,the provision of
periodic reports of the status of each Account and the
disbursement of benefits on behalf of the Employer in
accordance with the provisions of this Plan.
IV.PARTICIPATION IN THE PLAN
4.01 Initial Participation:An Employee may becomea Participant
by entering into a Joinder Agreement prior to the beginning
of the calendar month in which the Joinder Agreement is to
become effective to defer compensation not yet earned.
4.02 Amendment ofJoinder Agreement:AParticipant mayamend
an executed Joinder Agreement to change the amount of
compensation not yet earned which is to be deferred
(including the reduction ofsuch future deferrals tozero) or to
change his investment preference (subject to such restric
tions as may resultfrom the nature or termsofany investment
made by the Employer). Such amendment shall become
effective as of the beginning of the calendar month
commencing after the date the amendment is executed.A
Participant may at any time amend his Joinder Agreement to
change the designated Beneficiary and such amendment
shall become effective immediately.
V.LIMITATIONS ON DEFERRALS
5.01 Normal Limitation:Except as provided in Section 5.02.the
maximum amount of Deferred Compensation for any
Participant forany taxable year shall not exceed the lesser of
$7,500.00 or 33 1/3 percent of the Participant's Includible
Compensation for the taxable year. This limitation will
ordinarily be equivalent to the lesser of $7,500.00 or 25
percentofthe Participant's Normal Compensation.
5.02 Catch-up Limitation:For each of the last three (3) taxable
yearsofa Participant ending before hisattainment ofNormal
Retirement Age.the maximum amount of Deferred
Compensation shall bethe lesser of:(1)$15,000 or (2)the
sumof(i)the Normal Limitation forthetaxable year,and(ii)
that portion ofthe Normal Limitation for eachofthe prior
taxable years of the Participant commencing after 1978
during which the Plan was in existence and theParticipant
was eligible to participate in the Plan (or in any other plan
established undersection 457 ofthe Internal Revenue Code
by anemployer within thesame State asthe Employer)less
the amount of Deferred Compensation foreach such prior
taxable year (including amounts deferred under such other
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plan).For purposes of this Section 5.02,a Participant's
Includible Compensation for thecurrenttaxableyearshallbe
deemed to include any Deferred Compensation for the
taxable year in excess of the amount permitted under the
Normal Limitation,and the Participant's IncludibleCompen
sation for any prior taxableyear shall be deemed to exclude
any amount that could have been deferred under the Normal
Limitation for such prior taxable year.
5.03 Section 403(b)Annuities:For purposes ofSections 5.01 and
5.02.amounts contributed by the Employer on behalf of a
Participant for the purchase of an annuitycontract described
in section 403(b)of the Internal Revenue Code shall be
treated as ifsuch amounts constituted Deferred Compensa
tion under this Plan for the taxable year in which the
contribution was made and shall thereby reduce the
maximum amountthat may be deferredfor such taxable yea
Vi.INVESTMENTS AND ACCOUNTVALUES
6.01 Investment of Deferred Compensation:All investments \I
Participants'Deferred Compensation made by the Employe,
including all property and rights purchased with such
amountsand all incomeattributable thereto,shall be thesole
property of the Employer and shall not be held in trust for
Participants or as collateral security for the fulfillment of the
Employer's obligations under the Plan.Such property shall
be subject to the claims of general creditors of the Employer,
and no Participant or Beneficiary shall have any vested
interest or secured or preferred position with respect to such
property or have any claim against the Employer except as a
general creditor.
6.02 Crediting ofAccounts:TheParticipant'sAccountshall reflect
the amount and value of the investments or other property
obtained by the Employer through the investment of the
Participant's Deferred Compensation.It is anticipated that
the Employer's investments with respect to a Participantwill
conform to the investment preference specified in the
Participant's JoinderAgreement,butnothing hereinshall be
construed to require the Employer to make any particular
investment of a Participant's Deferred Compensation.Each
Participant shall receive periodic reports,not less frequently
than annually,showing the then-current value of his
Account.
6.03 Acceptance ofTransfers:Pursuant to an appropriate written
agreement,the Employer may accept and credit to a
Participant's Account amounts transferred from another
employer within the same State representing amounts h«f \
by such other employer under an eligible State deferrt.compensation plan described in section 457 of the Intern!|
Revenue Code.Any such transferred amount shall not tie "
treated as a deferral subject to the limitations of Article V,
provided however,that the actual amount of any deferral
under the plan from which the transfer is made shall be taken
into account in computing the catch-up limitation under
Section 5.02.
6.04 Employer Liability:Innoeventshall the Employer'sliabilityto
pay benefits to a Participant underArticle VI exceedthe value
of the amounts credited to the Participant's Account;the
Employer shall not be liable for losses arising from
depreciation or shrinkage in the value of any investments
acquired under this Plan.
VII.BENEFITS
7.01 Retirement Benefits and Election on Separation from
Service: Except as otherwise provided in this ArticleVII,the
distribution of a Participant's Account shall commence
during thesecondcalendarmonth afterthecloseofthePlan
Yearof the Participant's Retirement, and the distribution of
such Retirement benefits shall be made in accordance with
one of the payment options described in Section 7.02.
Notwithstanding the foregoing,the Participant may irrevo-
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cably elect within 60 daysfollowing Separation from Service
to havethe distribution of benefitscommenceona date other
than that described in the preceding sentence which is at
least 60 days after the date such election is delivered in
writing to the Employer and forwarded to the Administrator
but not later than 60 days after the closeof the Plan Year of
the Participant's Retirement.
7.02 Payment Options:As providedinSections7.01,7.05and7.06,
a Participant may elect to have the value of his Account
distributed in accordance with oneof thefollowing payment
options,provided that such option is consistent with the
limitations set forth in Section 7.03:
(a)Equal monthly,quarterly,semi-annual or annual
payments in an amount chosen by the Participant,
continuing until his Account is exhausted;
(b)One lump sum payment;
(c)Approximately equal monthly,quarterly,semi-annual
or annual payments,calculated to continue for a period
certain chosen by the Participant;
(d)Payments equal to payments made by the issuer of a
retirement annuity policy acquired by the Employer;
(e)Any other payment option elected by the Participant
and agreed to by the Employer.
A Participant's election of a payment option must be made at
least 30 days before thepayment of benefitsis tocommence.
If a Participant fails to make a timely election of a payment
option,benefits shall be paid monthly underoption (c)above
for a period of five years.
7.03 Limitation on Options:No payment option may be selected
by the ParticipantunderSection7.02unlessthe presentvalue
of the payments to the Participant,determinedasof thedate
benefits commence,exceeds 50 percent of the value of the
Participant's Account as of the date benefits commence.
Present value determinations under this Section shall be
made by the Administrator in accordance with the expected
return multiples set forth in section 1.72-9 of the Federal
Income Tax Regulations (or any successor provision tosuch
regulations).
7.04 Post-retirement Death Benefits:Should the Participant die
after he has begun to receive benefits unoer a payment
option,the remaining payments,if any,under the payment
option shall be payable to the Participant's Beneficiary
commencing within 60 days after the Administrator receives
proofof the Participant's death,unless the Beneficiary elects
payment under a different payment option at least 30 days
prior to the date that the first payment becomes payable to
the Beneficiary.In no event shall the Employer or
Administrator be liable to the Beneficiary for the amount of
any payment made in the name of the Participant before the
Administrator receives proof of death of the Participant.
Notwithstanding the foregoing,payments to a Beneficiary
shall not extend over a period longerthan (i)the Beneficiary's
life expectancy ifthe Beneficiary is the Participant's spouse
or (ii)fifteen (15)years if the Beneficiary is not the
Participant's spouse.If no Beneficiary is designated in the
Joinder Agreement,orif thedesignated Beneficiarydoes not
survive the Participant for a period of fifteen (15)days,then
the commuted value of any remaining payments under the
payment option shall be paid in a lump sum to the estate of
the Participant.If the designated Beneficiary survives the
Participant for a period of fifteen (15)days,but does not
continue to live for the remaining period of payments under
the payment option (as modified,ifnecessary,in conformity
with the third sentence of this section),then the commuted
value of any remaining payments under the payment option
shall be paid in a lump sum to the estate of tha Beneficiary.
7.05 Pre-retirement Death Benefits:Should the Participant die
before he has begun to receive the benefits provided by
Sections 7.01 or 7.06.a death benefit equal tothe valueof the
Participants Account shall be payable to the Beneficiary
commencing no later than 60 days after thecloseof the Plan
r ,Year in which the Participant would have attained Normal
Retirement Age.Such death benefit shall be paid in a lump
sum unless the Beneficiary electsa different payment option
within 90 days of the Participant's death.A Beneficiary who
may elect a payment option pursuant to the provisions of the
precedingsentenceshall betreatedas ifhewerea Participant
for purposes of determining the payment options available
under Section 7.02;provided,however,that the payment
option chosen by the Beneficiary must providefor payments
to the Beneficiary over a period no longer than the life
expectancy of the Beneficiary if the Beneficiary is the
Participant's spouse and must provide for payments over a
period not in excess of fifteen (15)years if the Beneficiary is
not the Participant's spouse.
7.06 Disability:In theevent a Participant becomesdisabled before
the commencement of Retirement benefits under Section
7.01,the Participant may elect to commence benefits under
one of the payment options described in Section 7.02 on the
last day of the month following a determination of disability
by the Employer.The Participants request for such
determination must be made within a reasonable time after
the impairment which constitutes the disability occurs.A
Participant shall be considered disabled for purposes of this
Plan if he is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or
mental impairment which can beexpected to result in death
or be of long-continued and indefinite duration.The
disability of any Participant shall be determined in
accordance with uniform principlesconsistentlyapplied and
upon the basis of such medical evidence as the Employer
deems necessary and desirable.
7.07 Unforeseeable Emergencies:In the event an unforeseeable
emergency occurs,a Participant may apply to the Employer
to receive that part of the value of his account that is
reasonably needed tosatisfy the emergency need.Ifsuch an
application is approved by the Employer,theParticipantshall
be paid only such amount as the Employer deems necessary
to meet the emergency need,but payment shall not be made
to the extent that the financial hardship may be relieved
through cessation of deferral under the Plan,insurance or
other reimbursement,or liquidation of other assets to the
extentsuch liquidationwould notitselfcausesevere financial
hardship.An unforeseeable emergency shall be deemed to
involve only circumstances ofseverefinancial hardshipto the
Participant resulting from a suddenand unexpected illnessor
accident of the Participant or of a dependent (as defined in
section 152(a)of the Internal Revenue Code)of the
Participant,loss of the Participant's propertydue to casualty,
or other similar and extraordinary unforeseeable circum
stances arising as a result of events beyond the control of the
Participant.The need to send a Participant's child to college
or to purchase a new home shall not be considered
unforeseeable emergencies.The determination as to
whether such an unforeseeable emergency exists shall be
based on the merits of each individual case.
VIII.NON-ASSIGNABILITY
No Participant or Beneficiary shall have any right to commute,
sell,assign,pledge,transfer or otherwiseconvey or encumber the
right to receive any payments hereunder,which payments and
rights are expressly declared to be non-assignable and non
transferable.
IX.RELATIONSHIP TO OTHER PLANS AND EMPLOYMENT
AGREEMENTS
This Plan serves in addition to any other retirement,pension,or
benefit plan or system presently in existence or hereinafter
established for the benefit of the Employer's employees,and
participation hereunder shall not affect benefits receivable under
any such plan or system.Nothing contained in this Plan shall be
deemed to constitute an employment contract or agreement
between any Participant and the Employer or to give any
Participant the right to be retained in the employof the Employer.
Nor shall anything herein beconstrued to modify the terms of any
employment contract or agreement between a Participant and the
Employer.
X.AMENDMENT OR TERMINATION OF PLAN
The Employer may at any time amend this Plan provided that it
transmits such amendment in writing to the Administrator at least
30 days prior to the effective date of the amendment.The consent
of the Administrator shall not be required in order for such
amendment to become effective,but the Administrator shall be
under no obligationto continueactingas Administratorhereunder
if it disapproves of such amendment.The Employer may at any
time terminate this Plan.
The Administrator may at any time propose an amendment to
the Plan byan instrument in writing transmitted to the Employer at
least 30 days before the effective date of the amendment.Such
amendment shall become effective unless,within such 30-dr.y
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period,the Employer notifies the Administrator in writing that it
disapproves such amendment,in which case such amendment
shall not become effective.In the event of such disapproval,the
Administrator shall be under no obligation to continue acting as
Administrator hereunder.
No amendment or termination of the Plan shall divest any
Participant of any rights with respect to compensation deferred
before the date of the amendment or termination.
XI.APPLICABLE LAW
This Plan shall be construed under the laws of the state where
the Employer is located and is established with the intent that it
meetthe requirementsof an "eligible Statedeferredcompensation
plan"under section 457 of the Internal Revenue Code of 1954, as
amended.The provisionsof thisPlan shall be interpreted whereverf-
possible in conformity withthe requirements of thatsection.I
XII.GENDER AND NUMBER <
The masculine pronoun,whenever usedherein,shall includethe
feminine pronoun,and the singular shall includethe plural,except
where the context requires otherwise.
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APPENDIX B
DECLARATION OF TRUST
of
ICMA RETIREMENT TRUST
.•ARTICLE I.Name and Definitions
I !SECTION 1.1.Name.The Name of the Trust created hereby is the
\PMA Retirement Trust.
SECTION 1.2.Definitions.Wherever they are used herein,the
following terms shall have the following respective meanings:
(a) By-Laws.The By-Laws referred to in Section 4.1 hereof,as
amended from time to time.
(b)Deferred Compensation Plan. Adeferred compensation plan
established and maintained by a Public Employerfor the purpose
of providing retirement income and other deferred benefits to its
employees in accordance with the provisions of section 457 of
the Internal Revenue Code of 1954.as amended.
(c)Guaranteed Investment Contract.A contract enteredinto by
the Retirement Trustwith insurance companiesthat providesfor
a guaranteed rate of return on investments made pursuant to
such contract.
(d)ICMA.The International City Management Association.
(e)ICMA/RC Trustees.Those Trustees elected by the Public
Employers who, in accordance with the provisions of Section
3.1(a)hereof,arealso members of the Boardof Directors of ICMA
or RC.
(f)InvestmentAdviser.The Investment Adviserthatenters into a
contract with the RetirementTrustto provideadvice with respect
to investment of the Trust Property.
(g)Employer Trust.A trust created pursuant to an agreement
between RC and a Public Employer for the purpose of investing
and administering the funds set aside by such employer in
connection with its deferred compensation agreements with its
employees.
(h)Portfolios.The Portfolios of investments established by the
Investment Adviser to the Retirement Trust,under the
supervision of the Trustees,for the purpose of providing
investments for the Trust Property.
(i)Public Employee Trustees.Those Trustees elected by the
Public Employers who,in accordance with the provisions of
Section 3.1(a)hereof,are full-time employees of Public
Employers.
(j)Public Employer.A unit of state or local government,or any
agency or instrumentality thereof,that has adopted a Deferred
Compensation Plan and has executed this Declaration of Trust.
(k) RC.The International City Management Association
Retirement Corporation.
(I)Retirement Trust.The Trust created by this Declaration of
Trust.
(m)Trust Property.Theamounts heldin the Retirement Truston
behalf of the Public Employers.The Trust Propertyshall include
any income resulting from theinvestmentof theamountsso held.
(n)Trustees.The Public Employee Trustees and ICMA/RC
Trusteeselected bythe Public Emplo/ers to serveasmembersof
the Board of Trustees of the Retirement Trust.
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ARTICLE II.Creation and Purpose of the Trust;Ownership ofTrust
Property
SECTION 2.1.Creation.The Retirement Trust is created and
established by theexecution of this Declarationof Trustby the Trustees
and the participating Public Employers.
SECTION 2.2.Purpose.The purpose of the Retirement Trust is to
provide for the commingled investment of funds held by the Public
Employers in connection with their Deferred Compensation Plans.The
Trust Property shall be invested in the Portfolios,in Guaranteed
Investment Contracts and in other investments recommended by the
Investment Adviser under the supervision of the Board of Trustees.
SECTION 2.3 Ownership of Trust Property.The Trustees shall have
legal title to the Trust Property.The Public Employers shall be the
beneficial owners of the Trust Property.
ARTICLE III.Trustees
SECTION 3.1.Number and Qualification of Trustees.
(a)The Board of Trustees shall consist of nine Trustees.Five of
the Trustees shall be full-time employees of a Public Employer
(the Public Employee Trustees)who are authorized by such
Public Employer to serveasTrustee.Theremaining four Trustees
shall consist of two persons who,at the time of election to the
Board of Trustees,are members of the Board of Directors of
ICMA and two persons who,at the time of election,are members
of the Board of Directors of RC (the ICMA/RC Trustees).One of
the Trustees who is a director of ICMA,and one of the Trustees
who is a director of RC.shall,at the timeof election,befull-time
employees of a Public Employer.
(b) No person may serve as a Trustee for more than one term in
any ten-year period.
SECTION 3.2.Election and Term.
(a)Except for the Trustees appointed to fill vacancies pursuant
to Section 3.5 hereof,the Trustees shall be elected by a vote of a
majority of the Public Employers in accordance with the
procedures set forth in the By-Laws.
(b) At the first election of Trustees,three Trustees shall be
elected for a term of three years,three Trustees shall be elected
for a term of two years and three Trustees shall be elected for a
term of one year.At each subsequent election,three Trustees
shall be elected for a term of three years and until his or her
successor is elected and qualified.
SECTION 3.3.Nominations.The Trustees who are full-time
employees of Public Employers shall serve as the Nominating
Committee for the Public Employee Trustees.The Nominating
Committee shall choose candidates for Public Employee Trustees in
accordance with the procedures set forth in the By-Laws.
SECTION 3.4.Resignation and Removal.
(a) Any Trustee may resign as Trustee (without need for prior or
subsequent accounting)by an instrument in writingsigned by the
Trusteeand delivered to the other Trustees and such resignation
shall be effective upon such delivery,or at a laterdateaccording
to the terms of the instrument.Any of the Trustees may be
removed for cause,by a vote of a majority of the Public
Employers.
(b)Each Public EmployeeTrusteeshallresign hisor herposition
as Trusteewithin sixty days of the dateon which heorsheceases
to be a full-time employee of a Public Employer.
SECTION 3.5.Vacancies.The term of office of a Trustee shall
terminate and a vacancy shall occur in the event of the death,
resignation,removal,adjudicated incompetence orother incapacity to
perform the dutiesof theofficeof a Trustee.Inthecaseof a vacancy,the
remaining Trusteesshall appoint such person as they in theirdiscretion
shall see fit (subject to the limitationsset forth in this Section),to serve
for the unexpired portion of the term of the Trustee who hasresigned or
otherwise ceased to be a Trustee.The appointment shall be made by a
written instrument signed by a majority of the Trustees.The person
appointed must be the same type of Trustee (i.e.,Public Employee
Trustee or ICMA/RC Trustee)as the person who has ceased to be a
Trustee.An appointment of a Trustee may be made in anticipation of a
vacancy to occur at a later date by reason of retirementor resignation,
provided thatsuch appointmentshallnotbecomeeffectivepriorto such
retirement or resignation.Whenever a vacancy in the number of
Trustees shall occur,until such vacancy is filled as provided in this
Section 3.5.theTrustees in office,regardlessof their number,shall have
all the powers granted tothe Trusteesand shall dischargeall the duties
imposed upon the Trustees by this Declaration.A written instrument
certifying the existence of such vacancy signed by a majority of the
Trusteesshall be conclusiveevidence of the existence of suchvacancy.
SECTION 3.6.Trustees Serve in Representative Capacity.By
executing this Declaration,each Public Employeragrees thatthe Public
Employee Trustees elected by the Public Employers areauthorized to
act as agents and representatives of the Public Employers collectively.
ARTICLE IV.Powers of Trustees
SECTION 4.1.General Powers.The Trusteesshall have the power to
conduct the business of the Trust and to carry on its operations.Such
power shall include,but shall not be limited to,the power to:
(a)receivethe Trust Property from the Public Employersorfrom
a Trustee of any Employer Trust;
(b)enter into a contract with an Investment Adviser providing,
among other things,for the establishment and operation of the
Portfolios,selection of the 3uaranteed Investment Contracts in
which the Trust Property may be invested,selection of other
investmentsfor theTrust Propertyand thepaymentof reasonable
fees to the Investment Adviser and to anysub-investmentadviser
retained by the Investment Adviser;
(c)review annually the performance of the Investment Adviser
andapproveannuallythe contract withsuch Investment Adviser;
(d)invest and reinvest the Trust Property in the Portfolios,the
Guaranteed Investment Contracts and in any other investment
recommended by the Investment Adviser,provided that if a
Public Employer has directed that its monies be invested in
specified Portfolios or in a Guaranteed Investment Contract,the
Trustees of the Retirement Trust shall invest such monies in
accordance with such directions;
(e)keep such portion of tne Trust Property in cash or cash
balances as theTrustees,from timetotime,may deem tobe in the
best interest of the Retirement Trust created hereby,without
liability for interest thereon;
(f)accept and retain for such time as they may deem advisable
any securities or other prop3rty received or acquired by them as
Trustees hereunder,whether or not such securities or other
property would normally be purchased as investments here
under;
(g)cause any securities o;other property held as part of the
Trust Property to be registered in the name of the Retirement
Trust or in the nameof a nominee,and to holdany investments in
bearer form,but the books and recordsof the Trusteesshallatall
r^
times show that all such investments are a part of the Trust
Property:
(h)make,execute,acknowledge,and deliver any and'all
documents of transfer and conveyance and any and all other
instrumentsthat may be necessaryorappropriatetocarry outthe
powers herein granted;
(i)vote upon any stock,bonds,or othersecurities;give general
or special proxies or powers of attorneywith orwithoutpowerof
substitution;exercise any conversion privileges,subscription
rights,or other options,and make any payments incidental
thereto;oppose,or consent to,or otherwise participate in,
corporate reorganizations or other changes affecting corporate
securities,and delegate discretionary powers,and pay any
assessments or charges in connection therewith;and generally
exercise any of the powers of an owner with respect to stocks,
bonds,securities or other property held as part of the JrC"\
Property;j I
(j)enter into contracts or arrangements for goods or servic
required in connection with the operation of the Retireme
Trust,including,but not limited to.contractswithcustodians ana ;
contracts for the provision of administrative services;
(k)borrow or raise money for the purpose of the Retirement
Trustin such amount,andupon suchtermsand conditions,asthe
Trustees shall deem advisable,provided that the aggregate
amount of such borrowings shall not exceed 30%of the valueof
the Trust Property.No person lending money to the Trustees
shall be bound to see the application of the money lent or to
inquire into its validity,expediency or propriety of any such
borrowing;
(I)incur reasonableexpensesasrequiredfortheoperationof the
Retirement Trust and deduct such expenses from the Trust
Property;
(m)pay expenses properly allocable to the Trust Property
incurred in connection with the Deferred Compensation Plans or
the Employer Trusts and deductsuch expenses from that portion
of the Trust Property beneficiallyowned by the Public Employer
to whom such expenses are properly allocable;
(n) pay out of the Trust Property all real and personal property
taxes,incometaxesand other taxes of anyand all kindswhich,in
the opinion of the Trustees,are properly levied,or assessed
under existing or future laws upon,or in respect of,the Trust
Propertyandallocateanysuchtaxestotheappropriate accounts;
(o)adopt,amendand repealthe By-Laws,provided thatsuch By-
Laws are at all timesconsistent withthe terms of this Declaration
of Trust;f*~\
(p)employ personstomakeavailable interestsinthe Retireme,j
Trust toemployers eligible tomaintain adeferred compensate |
plan under section 457 of the Internal Revenue Code,as
amended;
(q)issue the Annual Report of the Retirement Trust,and the
disclosure documents and other literature used by the
Retirement Trust;
(r)make loans,including the purchase of debt obligations,
provided that all such loans shall bear interest at the current
market rate;
(s)contract for,and delegate any powers granted hereunder to.
such officers,agents,employees,auditors and attorneys as the
Trustees may select,provided that theTrusteesmay not delegate
the powers set forth in paragraphs (b),(c)and (o) of this Section
4.1 and may not delegate any powers if such delegation would
violate their fiduciary duties;
(t)provide for the indemnificationof theofficersand Trustees of
the Retirement Trust and purchase fiduciary insurance;
(u)maintain books and records,includingseparateaccountsfor
each Public Employer or Employer Trust and such additional
separate accountsas are required under,andconsistentwith,the
Deferred Compensation Plan of each Public Employer;and
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(v)do all such acts,take all such proceedings,and exercise all
such rights and privileges,although not specifically mentioned
herein,as the Trustees may deem necessary or appropriate to
administertheTrust Property andto carry outthepurposesof the
Retirement Trust.
SECTION 4.2.Distribution of Trust Property.Distributions of the
Trust Property shall be made to, or on behalf of,the PublicEmployer,in
accordance with the terms of the Deferred Compensation Plans or
Employer Trusts.The Trustees of the Retirement Trust shall be fully
protected in making payments in accordance with the directions of the
Public Employers or the Trustees of the Employer Trusts without
ascertaining whether such payments are in compliance with the
provisions of the Deferred Compensation Plans or the agreements
creating the Employer Trusts.
SECTION 4.3.Execution of Instruments.The Trustees may
unanimously designateany oneor more of the Trustees to executeany
hstrument or document on behalf of all,including but not limited to the
igning or endorsement of any check and the signing of any
pplications,insurance and other contracts,and the action of such
designated Trustee orTrustees shall have thesame force andeffect asif
taken by all the Trustees.
ARTICLE V.Duty of Care and Liability of Trustees
SECTION 5.1.Duty of Care.In exercising the powers hereinbefore
granted to the Trustees,the Trustees shall perform all acts within their
authority for the exclusive purpose of providing benefits for the Public
Employers,and shall perform such acts with the care,skill,prudence
anddiligence in thecircumstancesthen prevailing that a prudentperson
acting in a like capacity and familiar with such matters would use in the
conduct of an enterprise of a like character and with like aims.
SECTION 5.2.Liability.The Trustees shall not be liable for any
mistake of judgment or other action taken in good faith,and for any
action taken or omitted in reliance in good faith upon the books of
account or other records of the Retirement Trust,upon the opinion of
counsel,or upon reports made to the Retirement Trust by any of its
officers,employees oragentsor by the Investment Adviser or any sub-
investment adviser,accountants,appraisers or other experts or
consultants selected with reasonable care by the Trustees,officers or
employees ofthe Retirement Trust. The Trustees shall also not be liable
for any loss sustained bythe Trust Propertyby reason ofany investment
made in good faith and inaccordance with the standard of careset forth
in Section 5.1.
U
SECTION 5.3.Bond.No Trustee shall be obligated to give any bond
or other security for the performance of any of his or her duties
hereunder.
ARTICLE VI.Annual Report to Shareholders
The Trustees shall annually submittothe Public Employers a written
report of the transactions of the Retirement Trust,including financial
statements which shall be certified by independentpublic accountants
chosen by the Trustees.
ARTICLE VII.Duration or Amendment of Retirement Trust
SECTION 7.1.Withdrawal.A Public Employer may.at anytime,with
draw from this Retirement Trust by delivering to the Boardof Trusteesa
statement to that effect.The withdrawing Public Employer's beneficial
interest in the Retirement Trust shall bepaid outto thePublicEmployer
or to the Trustee of the Employer Trust,as appropriate.
SECTION 7.2.Duration.The Retirement Trust shall continue until
terminated by the vote of a majority of the Public Employers,each
casting one vote.Upon termination,all of the Trust Property shall be
paid outto the Public Employers or theTrustees of the EmployerTrusts,
as appropriate.
SECTION 7.3.Amendment.The Retirement Trust may be amended
by the voteof a majority of the Public Employers,each casting onevote.
SECTION 7.4.Procedure.A resolution to terminate or amend the
Retirement Trust or to remove a Trustee shall besubmitted to a vote of
the Public Employers if: (a) a majority of the Trustees so direct,or (b) a
petition requesting a vote,signed by not less than 25% of the Public
Employers,is submitted to the Trustees.
ARTICLE VIII.Miscellaneous
SECTION8.1.Governing Law.Except as otherwiserequired by state
or local law,this Declaration ofTrust and the Retirement Trust hereby
created shall be construed and regulated by the laws of the District of
Columbia.
SECTION 8.2.Counterparts.This Declaration may be executed by
the Public Employersand Trustees in twoor morecounterparts,each of
which shall be deemed an original but all of which together shall
constitute one and the same instrument.
u.-
APPENDIX C
TRUST AGREEMENT WITH
THE ICMA RETIREMENT CORPORATION
AGREEMENT made by and between the Employer named in the
attached resolution and the International CityManagementAssociation
Retirement Corporation (hereinafter the "Trustee"or "Retirement
/Corporation"),anonprofit corporation organized and existing underthe
,aws of the State of Delaware,for thepurposeof investingandotherwise
\administering the funds set aside by Employers in connection with
l^jfeferred compensation plans established under section 457 of the
Internal RevenueCode of 1954 (the"Code").This Agreementshall take
effect upon acceptance by the Trustee of its appointment by the
Employer to serve as Trustee in accordance herewith asset forth in the
attached resolution.
WHEREAS,the Employerhas established adeferred compensation plan
under section 457 of the Code (the "Plan");
WHEREAS,in order that there will be sufficient funds available to
discharge the Employer's contractual obligations under the Plan,the
Employer desiresto setaside periodically amounts equal totheamount
of compensation deferred;
WHEREAS,the funds set aside,togetherwith any and all assetsderived
from the investment thereof,are to be exclusively within the dominion.
control,and ownership of the Employer,and subject to the Employer's
absolute right of withdrawal, no employees having any interest
whatsoever therein;
NOW.THEREFORE,this Agreement witnesseth that (a)the Employer
will pay monies to the Trustee to be placed in deferred compensation
accounts for the Employer;(b)the Trustee covenants that it will hold
said sums,and any other funds which it may receive hereunder,in trust
for the uses and purposes and upon the terms and conditions
hereinafter stated;and (c)the parties hereto agree as follows:
ARTICLE I.General Duties of the Parties.
Section 1.1.General Duty of the Employer.The Employershall make
regular periodic payments equal to the amounts of its employees'
.compensation which are deferred in accordance with the terms and
jnditions of the Plan to the extentthatsuch amountsarcto beinvested
jfnder the Trust.
Section 1.2.General Duties of the Trustee.The Trustee shall hold all
Tunds received by it hereunder,which,together with the income
therefrom,shall constitute theTrust Funds.It shalladminister theTrust
Funds,collect theincomethereof,and make payments therefrom,all as
hereinafter provided.The Trustee shall also holdall Trust Funds which
aretransferred to it as successorTrustee by the Employer from existing
deferred compensation arrangements with its Employees under plans
described in section 457 of the Code.Such Trust Funds shallbe subject
to all of the terms and provisions of this Agreement.
ARTICLE II.Powers and Duties of the Trustee in Investment,
Administration,and Disbursement of the Trust Funds.
Section 2.1.Investment Powers and Duties of the Trustee.The
Trustee shall have the power to invest and reinvest the principal and
income of the Trust Funds and keep the Trust Funds invested,without
distinction between principal and income,in securities or in other
property,real or personal,whereversituated,including,butnot limited
to,stocks,common or preferred,bonds,retirement annuity and
insurance policies,mortgages,and other evidences of indebtednessor
ownership, investment companies,common or group 'rust funds, or
separate and different types of funds (including equity,fixed income)
which fulfill requirements of state and local governmental laws.
provided,however,that the Employer may direct investment by the
Trustee among available investment alternatives in such proportions as
the Employer authorizes in connection with its deferred compensation
agreements with its employees.For these purposes,theseTrust Funds
may be commingled with Trust Funds set aside by other Employers
pursuantto the terms ofthe ICMA RetirementTrust.Investment powers
vested in theTrustee by the Section maybedelegated bythe Trustee to
any bank,insurance or trust company,or any investment advisor.
manager or agent selected by it.
Section 2.2.Administrative Powers of the Trustee.TheTrustee shall
have the power in its discretion:
(a)To purchase,or subscribe for,any securities or other
property and to retain the same in trust.
(b)To sell,exchange,convey,transfer or otherwise dispose of
any securities or other property held by it,by private contract,or
at public auction.No person dealing with the Trustee shall be
bound to see the application of the purchase money or to inquire
into the validity,expediency,or propriety of any such sale or
other disposition.
(c) To vote upon any stocks,bonds,or other securities;to give
general or special proxies or powers of attorney with or without
power of substitution;to exercise any conversion privileges,
subscription rights,orotheroptions,and to make any payments
incidental thereto;to oppose,or to consent to.or otherwise
participate in,corporate reorganizations or other changes
affecting corporate securities,and to delegate discretionary
powers,and to pay any assessments or charges in connection
therewith;and generally to exercise any of the powers of an
owner with respect to stocks,bonds,securitiesor other property
held as part of the Trust Funds.
(d)To causeany securities orother property held as part of the
Trust Funds to be registered in its own name,and to hold any
investments in bearer form,but the books and records of the
Trustee shall at all times showthat all such investments area part
of the Trust Funds.
(e) To borrow or raise money for the purposeof theTrust in such
amount,anduponsuch termsandconditions,as theTrusteeshall
deem advisable:and.for any sum so borrowed,to issue its
promissory noteas Trustee,and to secure therepayment thereof
by pledging all, or any part,of the Trust Funds.No person lending
money to the Trustee shall be bound to see the application of the
money lent or to inquire into its validity,expediency or propriety
of any such borrowing.
(f) To keep such portion of the Trust Funds in cash or cash
balances as theTrustee,from time to time,may deem to be in the
best interest of the Trust created hereby,without liability for
interest thereon.
(g) To accept and retain for such time as it maydeem advisable
any securities or other property received or acquired by it as
Trustee hereunder,whether or not such securities or other
propertywould normally be purchased as investment hereunder.
(h) To make,execute,acknowledge,and deliver any and all
documents of transfer and conveyance and any and all other
instruments that maybe necessaryor appropriateto carryoutthe
powers herein granted.
(i) To settle,compromise,or submit to arbitration any claims,
debts,or damages due or owing to or from the Trust Funds;to
commence or defendsuitsor legal or administrativeproceedings;
and to represent the Trust Funds in all suits and legal and
administrative proceedings.
(j)To do all such acts,take all such proceedings,and exerciseall
such rights and privileges,although not specifically mentioned
herein,as the Trustee may deem necessary to administer the
Trust Funds and to carry out the purposes of this Trust.
Section 2.3.Distributions from the Trust Funds.The Employer
hereby appoints the Trustee as its agent for the purpose of making
distributions from the Trust Funds.In this regard the terms and
conditions set forth in the Plan are to guide and control the Trustee's
power.
Section 2.4.Valuation of Trust Funds.At least once a year as of
Valuation Dates designated by the Trustee,the Trustee shall determine
the value of theTrust Funds.AssetsoftheTrustFundsshall bevaluedat
theirmarket values atthe closeof businesson theValuation Date,or,in
the absence of readily ascertainable market values asthe Trustee shall
determine,in accordance with methods consistently followed and
uniformly applied.
ARTICLE III.For Protection of Trustee.
Section 3.1.Evidence of Action by Employer.The Trustee may rely
upon any certificate,notice or direction purportingto have beensigned
on behalf of the Employer which the Trustee believes to have been
signed by a dulydesignated official of the Employer.No communication
shall be binding upon any of the Trust Funds or Trustee until they are
received by the Trustee.
Section 3.2.Advice of Counsel.The Trustee may consult with any
legal counsel with respect to the construction of this Agreement,its
duties hereunder,or any act,which it proposestotakeoromit,and shall
not be liable for any action taken or omitted in good faith pursuant to
such advice.
Section 3.3.Miscellaneous.The Trustee shall use ordinary care and
reasonable diligence,but shall not be liable for any mistake ofjudgment
orother actiontaken in goodfaith.The Trusteeshall not beliablefor any
loss sustained by the Trust Funds by reasons of anyinvestmentmadein
good faith and in accordance with the provisions of this Agreement.
The Trustee's duties and obligations shall be limited to those
expressly imposed upon it by this Agreement.
ARTICLE IV.Taxes,Expenses and Compensation of Trustee.
Section 4.1.Taxes.The Trusteeshall deductfrom andchargeagainst
the Trust Funds any taxes on the Trust Fundsor the incomethereof or
which the Trustee is required to pay with respect to the interest of any
person therein.
Section 4.2.Expenses.The Trustee shall deduct from and charge
againstthe Trust Fundsall reasonableexpensesincurredby the Trustee
in the administration of the Trust Funds,including counsel,agency,
investment advisory,and other necessary fees.
ARTICLE V.SettlementofAccounts.TheTrustee shall keepaccurate
and detailed accounts of all investments,receipts,disbursements,and
other transactions hereunder.
Within ninety (90)days after heclose of each fiscal year,the Trustee
shall render in duplicate to the Employer an account of its acts and
transactionsas Trustee hereunder.If any part of the TrustFundshall be
invested through the medium of anycommon,collectiveorcommingled
Trust Funds,the last annual report of such Trust Funds shall be
submitted with and incorporated in the account.
If within ninety (90)days a/ter the mailing of the account or any
amended account the Employer has not filed with the Trustee notice of
any objection to any act or transaction of the Trustee,the account or
amended account shall become an account stated.Ifanyobjection has
been filed,and if the Employer is satisfied thatitshould bewithdrawnor
if the account is adjusted to the Employer's satisfaction,the Employer
shall in writing filed with the Trusteesignifyapprovalof theaccountand
it shall become an account stated.
o
When an account becomes an account stated,such accountshalhbe
finally settled,and the Trustee shall be completely discharged and
released,as ifsuch accounthadbeen settledandallowed by a judgment
ordecreeof a court of competentjurisdiction in anactionor proceeding
in which the Trustee and the Employer were parties.
The Trustee shall have the right to apply at any time to a court of
competent jurisdiction for the judicial settlement of its account.
ARTICLE VI.Resignation and Removal of Trustee.
Section 6.1.Resignation of Trustee.The Trustee may resign at any
time by filing with the Employer its written resignation.Suchresignation
shall take effect sixty (60)days from the date of such filing and upon
appointment of a successor pursuant to Section 6.3.,whichever shall
first occur.
nove til I
tice of'I
Section 6.2.Removal of Trustee.The Employer may remove
Trustee at any time by delivering to the Trustee a written notice
removal and an appointment of a successor pursuant to Section 6:f
Such removal shall not take effect prior to sixty (60)days from su6.
delivery unless the Trustee agrees to an earlier effective date.
Section 6.3.Appointment of SuccessorTrustee.Theappointment of
a successor to the Trustee shall take effect upon the delivery to the
Trustee of (a) an instrument in writing executed by the Employer
appointing such successor,and exonerating such successor from
liability for the acts and omissions of its predecessor,and (b) an
acceptance in writing,executed by such successor.
All of the provisions set forth herein with respect to theTrusteeshall
relate to each successor with the same force and effect as if such
successor had been originally named as Trustee hereunder.
If a successor is notappointed with sixty (60)days after the Trustee
gives notice of its resignation pursuant to Section 6.1.,the Trustee may
apply to any court of competent jurisdiction for appointment of a
successor.
Section 6.4.Transfer of Funds to Successor.Upon the resignation or
removal of the Trustee and appointment of a successor,and after the
final accountof theTrustee has been properly settled,the Trustee shall
transferand deliver any of the Trust Funds involvedto suchsuccessor.
ARTICLE VII.Duration and Revocation of Trust Agreement.
Section 7.1.Duration and Revocation.This Trust shall continuefor
such time as may be necessary to accomplish the purpose for which it
was created but may be terminated or revoked at any time by the
Employer as it relates to any and/or all related participating Employees.
Written notice of such termination or revocation shall be given to the
Trustee by theEmployer.Upon termination or revocation oftheTrusJ^
all of the assets thereof shall return to and revert to the Employ/)
Terminationof this Trustshall not, however, relieve the Employerof thi I
Employer's continuing obligation to pay deferred compensation W.|
Employees in accordance with the terms of the Plan.
Section 7.2. Amendment.The Employershall havethe righttoamend
this Agreement in whole and in part but only with the Trustee's written
consent.Any such amendmentshallbecomeeffectiveupon(a)delivery
to the Trustee of a written instrument of amendment,and (b) the
endorsement by the Trustee on such instrument of its consent thereto.
ARTICLE VIII.Miscellaneous.
Section 8.1. Laws of the District of Columbia to Govern.This
Agreement and the Trust hereby created shall be construed and
regulated by the laws of the District of Columbia.
Section 8.2.Successor Employers.The "Employer"shall include any
personwho succeedsthe Employer andwhotherebybecomessubject
to the obligations of the Employer under the Plan.
Section8.3.Withdrawals.The Employer may.at any time,and from
time to time,withdraw a portion orallofTrust Funds createdbythis
Agreement.
Section 8.4.Gender and Number.The masculine includes the
feminine andthesingularincludes the plural unlessthecontextrequires
another meaning.
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