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Ordinance No. 2022-01 Amending Police Pension Plan and Trust Fund to Provide for In-Service Distribution of Benefits - January 4, 2022 CITY OF AVENTURA ORDINANCE NO. 2022-01 AN ORDINANCE OF THE CITY OF AVENTURA, FLORIDA, AMENDING CHAPTER 36 "RETIREMENT," ARTICLE II "POLICE PENSION PLAN AND TRUST FUND," BY AMENDING SECTION 36-26 "SERVICE RETIREMENT BENEFIT" TO PROVIDE FOR IN-SERVICE DISTRIBUTION OF BENEFITS TO CERTAIN RETIRED MEMBERS WHO RETURN OR TRANSFER TO EMPLOYMENT BY THE CITY IN A DEPARTMENT OR POSITION OUTSIDE THE POLICE DEPARTMENT; AMENDING SECTION 36-35, DEFERRED RETIREMENT OPTION PROGRAM (DROP) TO CONFORM; PROVIDING FOR REPEAL; PROVIDING FOR SEVERABILITY; PROVIDING FOR INCLUSION IN THE CODE; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City of Aventura (the "City") maintains a defined benefit pension plan for its certified police officers, which is known as the City of Aventura Police Officers' Retirement Plan (the "Plan"), and which is codified in Chapter 36 of the City Code; and WHEREAS, the City Commission desires to allow in-service distribution of retirement benefits to certain retired members of the plan who return or transfer to employment by the City in positions outside the Police Department; and WHEREAS, the City Commission finds that it is in the best interest of the City and its employees to amend the Plan; and WHEREAS, prior to Second Reading of this Ordinance, the City Commission has received, reviewed and considered an actuarial impact statement describing the actual impact of the amendments provided for herein. NOW THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF AVENTURA, FLORIDA': Words in strut type are deletions from exist text and word in underline type are additions to existing text. City of Aventura Ordinance No. 2022-01 Section 1. That each of the above-stated recitals are hereby adopted and confirmed. Section 2. That Chapter 36 "Retirement," Article II "Police Pension Plan and Trust Fund," Section 36-26, "Service retirement benefit," of the City Code of Ordinances be amended by adding subsection (i), Limited in-service distributions permitted, as follows.. (i) Limited in-service distributions permitted. To the extent permitted under the Internal Revenue Code with regard to in-service distributions, the benefits otherwise payable under this Section to a retired member who has reached the age and/or service requirements for a service retirement shall not be suspended or reduced merely on account of any re-employment or continued employment of the retired member by the City in any capacity (including, but not limited to, Full-Time, Part-Time, or Independent Contractor) in any department or position other than the Police Department. The retired member shall not be entitled to active membership in the plan by virtue of any such reemployment or continued employment outside the Police Department, shall not accrue any credited service therefor, and shall not be able to enter the Deferred Retirement Option Program (DROP) established by section 36-35 during such continued employment or re-employment. If a retired member whose employment is continued outside the Police Department was a participant in the DROP at the time such continued employment commenced, the member shall be permitted to remain a participant in the DROP for the remainder of the member's maximum period of DROP participation, receive distributions from the DROP after the member's DROP participation ends (either by the member reaching the maximum period of DROP participation, electing to cease DROP participation while still employed by the City outside the Police Department or terminating all City employment) in the manner and subject to deadlines set forth in section 36-35 and shall not be required to terminate employment outside the Police Department as a result thereof. If a re-employed member who is re-employed outside the Police Department was a DROP participant prior to separation from City service and had not yet received a distribution from the member's DROP account at the time of re-employment, the re-employed retired member shall receive distributions from the DROP in the manner and subject to the deadlines set forth in section 36-35 without regard to the re- employment. Page 2 of 6 City of Aventura Ordinance No. 2022-01 Section 3. That Chapter 36 "Retirement," Article II "Police Pension Plan and Trust Fund," Section 36-35, "Deferred retirement option program (DROP)," of the City Code of Ordinances be amended as follows: Sec. 36-35. - Deferred retirement option program (DROP). Effective October 1 , 2018, a deferred retirement option plan ("DROP") will be created. A member will be eligible to enter the DROP on the earlier of the first day that he/she is eligible for service retirement as defined by section 36-26(b)(2) or delayed retirement as defined in section 36- 26(b)(3) but with at least 11 years of credited service and attainment of age 57. Upon entering the DROP, a member will no longer accrue credited service or additional pension benefits and will no longer make employee contributions to the Retirement Plan. Instead, the amount of the monthly pension benefit for the benefit option selected by the member will be credited to the member's DROP account. The maximum period that a member may participate in the DROP is five years. After the maximum period of DROP participation, the member must terminate from employment as a City police officer or in the City Police Department. DROP participation must begin by the earlier of the date on which a member reaches 25 years of service or the date on which a member reaches age 57 with 11 years of service ("Maximum DROP Entry Deadlines"). A member may elect to enter DROP after the foregoing dates, but his/her maximum participation in the DROP will be reduced by the period of time in which the member delayed entry in the DROP after reaching either of the foregoing Maximum DROP Entry Deadlines. The member's DROP account will be self-directed by the member to mutual funds selected by the Retirement Plan's Board of Trustees from among those offered by a vendor selected by the Board of Trustees. The available mutual funds and the vendor may be changed from time to time by the Board of Trustees. Members will be solely responsible for the gains and losses of their individual self-directed DROP accounts. Members who elect to participate in the DROP shall be required to separate from City serViGe employment as a City police officer or in the City Police Department at the conclusion of the DROP period. A member's DROP shall be distributed to the member in a lump sum, rollover, or a combination of both, as soon as administratively practicable and not more than 90 days following the conclusion of the DROP period or approval of the distribution by the Retirement Plan Board of Trustees, whichever occurs last. Neither the City, the Retirement Plan, nor its Board of Trustees shall have any liability or responsibility to guarantee the principal and/or rate of return for a member's DROP assets. The DROP accounts, although self-directed Page 3 of 6 City of Aventura Ordinance No. 2022-01 separate accounts, will remain part of the pension trust, and distributions from a member's account shall not be permitted until termination of employment. Section 4. Repeal. All sections or parts of sections of the Code of Ordinances of the City of Aventura, all ordinances or parts of ordinances, and all resolutions or parts of resolutions in conflict herewith, be and the same are hereby repealed to the extent of such conflict. Section 5. Severability. Should any section or provision of this Ordinance, or any paragraph, sentence or word, be declared by a Court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remainder hereof, as a whole or a part hereof, other than the part declared to be invalid. Section 6. Inclusion in the Code. It is the intention of the City Commission of the City of Aventura that the provisions of this Ordinance shall become and be made a part of the Code of Ordinances of the City of Aventura and that the sections of this Ordinance may be renumbered or relettered and the word "ordinance" may be changed to "Chapter", "Section", "Article", or such other appropriate word or phrase, the use of which shall accomplish the intentions herein expressed. Section 7. Effective Date. This Ordinance shall be effective upon passage by the City Commission on second reading. Page 4 of 6 City of Aventura Ordinance No. 2022-01 The foregoing Ordinance was offered by Vice Mayor Friedland who moved its adoption on first reading. This motion was seconded by Commissioner Shelley and upon being put to a vote, the vote was as follows: Commissioner Jonathan Evans Yes Commissioner Denise Landman Yes Commissioner Dr. Linda Marks Yes Commissioner Marc Narotsky Yes Commissioner Robert Shelley Yes Vice Mayor Rachel S. Friedland Yes Mayor Enid Weisman Yes The foregoing Ordinance was offered by Commissioner Dr. Marks who moved its adoption on second reading. This motion was seconded by Commissioner Landman and upon being put to a vote, the vote was as follows: Commissioner Jonathan Evans Absent Commissioner Denise Landman Yes Commissioner Dr. Linda Marks Yes Commissioner Marc Narotsky Yes Commissioner Robert Shelley Yes Vice Mayor Rachel S. Friedland Yes Mayor Enid Weisman Yes Page 5 of 6 City of Aventura Ordinance No. 2022-01 PASSED on first reading this 2nd day of November, 2021. PASSED AND ADOPTED on second reading this 4t" day of January, 2022. 'c d"�' ENID WEISMAN, MAYOR ATTEST: ELLISA L. HORVA , MMC CITY CLERK APPROVED AS TO LEGAL SUFFICIENCY: CITY ATTORNEY Page 6 of 6