RES-11215 Amendment to Retirement Health Savings ProgramRESOLUTION NO. 11215
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF ORANGE AMENDING A RETIREMENT
HEALTH SAVINGS PROGRAM FOR CERTAIN CITY
OF ORANGE EMPLOYEE BARGAINING GROUPS.
WHEREAS, the City of Orange, hereinaRer referred to as "CiTy," has employees
rendering valuable services; and
WHEREAS, the amendment of its existing retiree health savings plan for such
employees serves the interest of the City and Employees.
NOW, THEREFORE, BE IT RESOLVED,that the City Council of the City of Orange
hereby amends the Plan in the form of ICMA Retirement Cotporation's VantageCare Retirement
Health Savings program which includes the Employer VantageCaze Retirement Health Savings
Plan Adoption Agreement which is attached hereto as Exhibit"A".
ADOPTED this l Oth day of Mazch 2020.
CC {'yL
Mark . Murphy, Mayor, of Orange
ATTEST:
Q t i .QlC 1 BLNs -
Pamela Coleman, CiTy Clerk, City of Orange
STATE OF CALIFORNIA )
COUNTY OF ORANGE )
CITY OF ORANGE
I, PAMELA COLEMAN, City Clerk of the City of Orange, California, do hereby certify
that the foregoing Resolution was duly and regularly adopted by the City Council of the City of
Orange at a regular meeting thereof held on the l Oth day of Mazch 2020, by the following vote:
AYES:COIJNCILMEMBERS: Alvazez, Murphy,Nichols, Monaco
NOES:COiJNCILMEMBERS: None
ABSENT: COiJNCILMEMBER5: None
ABSTAIN: COiINCILMEMBERS: None
Gvi Qo,t ' Q,h na.v
Pamela Coleman, City Clerk, City of Orange
EXHIBIT "A"
EMPLOYER VANTAGECARE RETIREMENT HEALTH SAVINGS PLAN ADOPTION
AGREEMENT
Behind this sheet.]
i`
ICM/kRC
EMPLOYER VANTAGE(ARE
RETIREMENT HEALTH SAVINGS ( RHS)
ADOPTION AGREEMENT
VANTAGECARE RETIREMENT HEALTH SAVINGS (RHS)
ADOPTION AGREEMENT
Plan Nutnber. B `.741
Select az applicable: Standalone RHS In egraced RHS Amendmen[o F cisting Plan
I. EmployerName: CItV Of OfdflQB State: CA
IL The Employer hereby attests chat it is a unit of a state or loral government or an agenry or instrumearality of oue or
more mits of a state or local goverament
III. Plan Dates:
A. Plaa Amendmenc EfTective Datc 1/1/2020
B. PlanYear:Enrer the annual accounting period for the RHS program. 1 1-12$1
N. T6e Employer intends to utilize t6e Trust to f nd only welfaze benefia pursuant to t6e fnllowing welfare bene6t
p1an(s)mbt sheaby heEmplayu: Model Welfare Plan
V. Eligible Groups,Participadon and Participant Eligibility Requiremenu
A. Eligible Groups
The folfowing group or groups of Employees aze eligible to participate in the Employels welfare benefits plan identified
in Settion IV. (check all applicable boxes):
All Employees
All Full-Time Employees
Non-Union Employees
Public Safety Employeu-Police
Public Safery Employees-Firefighters
General Employees
Collectively-Bargained Employeu(Speciry u s) See Attached
Other(specifygcoup(s))
The Employee gmup(s)speci5ed must mrrespond m a group(s)of[he same designa[ion that is de6ned in the stamtes,
ordinances,mles,regulations,personnd manuals or other documrncs or provisions in effect in che nam oc localiry oE
the Employer.
B.Participation
Mandatory Participation:All Employees in the covered group(s)are required[o pazticipace in
the Plan and shall receive contributions pursuant to Section VI.
If the Employer's underlying welfare benefit plan is in whole or part a non-collectively bargained plan that allows
reimbursement for medical prnses other than insurance premiums, the nondiscrimination requirements of
Intcrnal Rcvcnuc Codc(IRC)$ection 105(h)will apply.Thesc mles may impose aza ion on the benefics received
by high(y compensated individuals if[he Plan disciiminates in favor of highly comprnsated individuals in terms of
eligibility or benefits.The Employer should discuss these rules with appropriace counsel.
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C.Participant Eligibility Requiremen[a
I. Minimum servi<e:The minimum period of service required Eor parcicipation is N F (write N/A if no minimum
service is required).
2. Minimum age:The minimum age mquirtd for eligibiliry ro participate is N/P (wri¢N/A if no minimum age is
mquired).
VI.Contribution Soucros and Amounts
A. De6nitionofEarnings
Ihe defini ion of Eamings will apply m all RHS Contribu[ion Fea[ures thac reference"Eamings",induding Direcc
Employer Contribucions(Section VI.B1J and Mandamry Employee Compensacion Conaibucions(Seaion VI.B.2.).
Definition oE earnings:
B. DirectEmployer Contributions and Mandatory Contributions
1. Direa Employer Contrib cions
The Employer shall contribute on behalf of each Participant
of Eatnings
each Plan Year
A discretionary amount w be decermined each Plan Yeaz
Orhec(describe):
2.Manda[ory Employee Compensa[ion Conaibutions
Ihe Employer will make mandacory conicibu ions of Employee compensacion as follows:
Reduaion in Salary- of Earnings or$ will be concribuced for che Plan Year.
Decreased Meric or Pay Plan Adjustmenc-All or a por ion of the Employees'annual merit
or pay plan adjustment will be contcibuted as follows:
An Employee shall no have che righc ro disroncinue or vary che race of Mandarory Concri6ucions of Employee
Compensation.
3. Mandatory Employee Leave Conaibutions
Ihe Employer will make mandamry contributions of acuued Ieave as follows(provide Formula for determining
Mandamry Employee Leave wnaibutions):
Q AccruedSickLeave % of eliaible cash out value
upon retirement from Citv
Accrued Uacation Leave
Q Other(specify type of leave)Accrued_I.eave
Floatina Holidays - see attached
An Employee shall noc have the righc co discontinue or vary che rate of mandamry leave contributions.
Non-colkctivdy bargainedplans that reimburre me lira[expenra other than rnruranre premiumr rhau[d rorault their brnefra rounre[
regar ling welfareplan rsonditoimination rukr:fthe employer de u to make ronaibutions basee!on a pnrentage ofearaingt.
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C. Limits on Total Contributions(check one box)
The toral contcibution by the Employer on behalf of each Pazticipan[(induding Direa Employer and Mandatory
Employee Concributions)for each Plan Year shall mt ezceed the Eollowing limic(s)below.Limia on individual
contribution types aze defincd within the appropiiace section above.
r There is no Plan-de6ned limit on the percentage or dollaz amount of eaznings that may be wnaibuted.
of eaznings
Definidon of earnings:Same as Sec[ion VI.A. O[her
for the Plan yeaz.
VII.Vesting for Direct Employet Contributions
A.VestingSchedule(check one box)
r The account is 100%vesced at all times.
The following vaung schedule shall apply[o Dirett Employer Contribu[ions as oudined in Sec[ion VI.B1.:
YearsofService Vuting
Completed Percentage
B. The accoun[will bemme 100%vested upon the death disability,retiremmt*,or attainment of benefit
eligibility(as outlined in Section IX)by a Participa¢t.
Definition of retirement includes a separation from service component and is further defined by(check one):
Ihe Primary retirement Plan of che Employer
Separation fmm setvice
Other
C. Any period of service by a Pazticipant pcior to a re6ire of the Participant by the Employer shall not count
toward the vesting scheduk outlined in A above.
VIII.Forfeiture Provisions
IE a Paaicipanc separaees from service prior ro full vesting,non-vested funds in he Participan's accounc shall be focfeimd in
accordance wi h che box checked under this section.
Upon thedea[h of a par[icipanq sucviving spouse,and all suwiving cligible dependents(as oudined in Section XI),funds
remaining in the Par[icipant's account shall be revert to the Trust in acwrdance with the boz checked under this sec[ion.
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IEa Parcicipan pecmanendy opts out and waives fucure reimbursements,as allowed under IRS Notice 2013-54,all funds in
che Participanc's acwunc at the time of waiver shall be forfeiced in accordance wich che boz checked under this seaion.'
Remain in[he Trust to be reallonted among all Plan Pattitipancs with a balance as Direct Employer Conaibutions
for che nezt and succeeding contribution ryde(s)."
Remain in the Trusc co be reallonted on an equal dollar basis among all Plan Participants with a balance."
Remain in the Tms[w be reallocated among all Plan Paaicipants bued upon Pazucipant account balanccs."
IX.Eligibility Requirements to Receive Medicai Benefit Paymen[s hom the VantageCare Retirement Healt6 Savings
Program
A. A Participant is e(igible to receive benefits:
At retirement only(also complere Seaion B J
Defini ion of retiremenr.
Sarne as Seaion VII.B.
Other
Ac sepaza ion from secvice with the following ces[ric[ions
No restriaions
Other
B. Termination prior to gene al brnefit digibility:In case where[he gencral bcnefit eligibiliry as outlined in Section
IX.A includes a retiremenc componenc,a Participant who separates from service of he Employer prior ro retirement
will be eligible[o receive benefits:
Immediacely upon separauon 6om service
Ocher
C. A Participant that bewmu totally aud permanently disabled
az defined by the Social Security Administration
as defined by t6e Employefs pdmary retirement plan
ot6er
will become immediatdy eligible ro receive medical benefit payments from his/her azcount under t6e Employer's
welfare beae6ts plaa.
D.Upo¢the death of the Participant bene6ca shall become payable as oudined in Section XI.
fthe Employn's RHS Prog'am doer not limit eligibi&ty to par6cipann mho have reparatrd from iesuice,the emplayer wiU be sequircd
to provide furthn dirrction so ICMA-RC regarding tbe treatment ofporrible connibutrons that a e required ro be made foUowing thr
partinpanir waiver.
f't{re forfeited balanrr rr.ma![whereby the rra![o ation amount ro each P/an Participant with a ba/arsce ir minrmal, the arreu wi!!
even to employeri forfiitu e a«ount fo further direction fram th<emplayer.If there a e pasticipanu witho:t a balann ruho rhauld
re eive fmf'eirurt anttt,pltate providt alcernatrve instructiant to ICMA-RC on the fo iture rea[location notice.
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X. Permissibk Medical Benefit Paymeau
Brnefits eligible for reimbursemenc consisc of:
All Medical Expenses eligible under IRC Settion 213 ocher than(i)direa long-rerm care expenses,and(ii)
expenses For medicina or drugs which aze noc prescribed deugs(other rhan insulin).
The following Medical Erzpenses eligible under IRC Secuon 213 other than(i)dirett longaerm care ezpenses,and(ii)
expenses for medicines or dmgs which aze not pruuibed drugs(other[han insulin).Select only the expensu}rou wish[o
cover under the Employer's welfare benefia plan:
Medical Insurance Premiums
Medical Ouo-of-Pocke[Fspensu"
Medicare Part B Insurance Premiums
Medicare Part D Insurance Premiums
Medicare Supplemental Insurance Premiums
Prescrip ion Drug Insuran¢Premiums
COBRA Insurance&emiums
Dental Insurance Premiums
Dental Ouo-of-Pocket Expenses'
Vision Insurance Premiums
Vision Out-of-Pockec Expenses'
Quafified Long-Term Care Insurance Premiums
Non-Prescrip[ion medications allowed under IRS guidance`
Other qualifying medid ezpenses(ducribe)'
Non-mlkctively bargained plaru th¢t reimbune mediral expenra other than irerurance prrnriamr.rhould camuk their
brnefia coume!regarding wdfare pGtn nond'uniminatiax rule.r ifthe rmploym ekca to mnke ronaibutiam bared an a
prrcrntage ofearningl.
XI.Benefitr Afrer the DeatL of the Participaat
In he evenc of a Participani s dea h,the following shall apply.
A. SurvivingSpouseand/orSu[viswgDependents
Upon the death of a pazcicipanc,the surviving spouse and/or surviving eligible dependena(as defined in Seaion
XII.D.) oEthe demased Participane are immediately eligible to maintain the Parzicipa s RHS account and utilizing
he remaining balanre to Eund eligible medical benefirs specified in Seceion X above.The accoun balance may be
reallocared'by he surviving spouse or dependena.
Beforc inurnin&pleacr rrud d e applirablefund du larun man,ia4 a rfullyfor a rompleu zumrxary ofallfre,
rxpensa,invrumrnt abjerdver and rtrategier,axC sirks. Thu infannation ir avarlable whrn you hg in at wmw.irn arc.osg/kgrn,
or r pon nguett by ca!ling(800)32G-7272.
IEa Patticipanis accoun[balance has not bmn fully utilized upon the death of the eligible spouse,rhe accoun[balance
may continue ro be utilized ro pay benefies of eligible dependents.Upon the death of all eligible dependents,the account
will reven in accocdance with the Employer's dection under$eaion VIII of the YanrageCare RHSAdoptian Agreemrnt.
G
B. NoSurvivingSpouseorSurvivingDependeats
IEthere are no living spouse or dependents at che cime of death of che Par[icipanc, the accounc will rever[in accordance
with the Employer's election under Section VIII of he l antageCareRHSAdoptionAgreemcnt.
XII.The Plaa will operate accordiug to the following provisioas:
A. Employer Responsibilities
1. The Employer will submit all VancageCare Retiremenc Healch Savings Plam m rib cion data via elearonic submission.
2. The Employei will submit all VantageCare Retiremen Health Savings Plan Par[icipant stams upda[es or personal
informa ion updares via elecaonic submission.This includes but is not limired m cermination notification,benefit
eligibiliry,and ves ing m ifica ion.
B. Participant account adminisaation and asseo-bued fees will be paid thtough the redemption oFParticipant account
shares,unless agreed upon otherwise in the Administra[ive Services Agreement.
C. Assignmenc of benefits is not permitced.Benefi[s will be paid only to the Participant,his/her Survivors, che
Employer,or an insurance provider(as allowed by the claims administramr).Paymenu ro a third-party payee(e.g.,
medical service provider)ace no[pecmitred with the exception oE reimbursement m he Employec oc insurance
provider(as allowed by che claims administraror).
D. An eligible dependenc is(a) che Parcicipant's lawful spouse,(b)the Participant's child unda the age of 27,as defined
by IRC Sec[ion 15(()and Inremal Revenue Service No[ice 2010$8,or(c)any other individual who is a pecson
described in IRC Seaion 152(a),as clarified by Inrernal Revenue Service Notice 2004-79.
E. The Employer will be responsible for wichhdding,reporting and remitting any applicable taxes For paymencs which
are deemed ro be discriminatory under IRC$ection 105(h),as oudined in the YantageCa e Retirement HeaLth Savingr
EmployerManual.
XIII.EmployerAcknowledgemenrs
A. The Employer hereby acknowledges it unders[ands that failure w properly fill out chis [antageCare Redrement Healtb
SavingrAdoptian Agrcement may resul[in the loss of taz exemption oEthe Tmst and/or loss of ax-deferred nams foc
Employer mnaibucions.
B. Q Check this box if you are including supporcing documents that include plan provisions.
EMPLO ^iSIG1 TURE
J
By:L Da[e:
Titl : or
Att Da[e:
Title:CiTy Clerk
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City of Orange
Memo
To: ICMA-RC Plan Adoption Services
From: Will Kolbow, Assistant City Manager/Adminishative Services D'uector
Date: Mazch 10, 2020
Subject: City of Orange VantageCaze RHS Plan(#803741) Amendment
The purpose of this memo is to oudine the groups that aze eligible and required to participate in the
City of Orange VantageCaze Retirement Heal[h Savings (RHS)Plan (Plan#803741).
Elieible Emolovee Grouns & Mandatory Contributions
Orange Management Association (exis[ing group in plan)
100% of eligible cash value of sick leave upon retirement from City
100% of eligible cash value of floating holidays upon retirement from City
City of Orange Police Management Association (new group in plan)
100% of eligible cash value of sick leave upon rearement from City
Water Division Employees Association(new group in plan)
100% of eligible cash value of sick leave upon retirement from City