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RES-10239 Retiree Health Savings Plan Establishment Orange Fire Management AssociationRESOLUTION NO. 10239 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ORANGE ESTABLISHING A RETIREE HEALTH SAVINGS PLAN FOR THE CITY OF ORANGE - FIRE MANAGEMENT ASSOCIATION. WHEREAS, the City of Orange (City)has employees rendering valuable services; and WHEREAS, the establishment of a retiree health savings plan for such employees serves the interests of the City by enabling it to provide reasonable security regarding such employees' health needs during retirement, by providing increased flexibility in its personnel management system and by assisting in the attraction and retention of competent personnel; and WHEREAS, the City has determined that the establishment of the retiree health savings plan (the Plan) serves the above objectives and should be of no cost to the City. NOW, THEREFORE BE IT RESOLVED, that the City Council of the City of Orange adopts the plan in the form of ICMA Retirement Corporation's VantageCare Retirement Health Savings program which includes the Employer VantageCare Retirement Health Savings Plan Adoption Agreement which is attached hereto as Exhibit A. BE IT FURTHER RESOLVED, that the assets of the Plan shall be held in the trust, with the City serving as a trustee, for the exclusive benefit of Fire Management Association Plan Participants and their beneficiaries, and the assets of the plan shall not be diverted to any other purpose prior to the satisfaction of all liabilities of the Plan. The City has authorized the Mayor to execute the Declaration of Trust of the City of Orange Integral Part Trust in the form of the model trust made available by the ICMA Retirement Corporation. The City shall have no tax liability to Plan Participants if any future determination is made that the Plan or any Plan Participant is not exempt from federal ar state taxes. BE IT FURTHER RESOLVED, that the Personnel Director shall be the coordinator and contact for the Plan and shall receive necessary reports, notices, etc. BE IT FURTHER RESOLVED, that the Mayor is authorized to execute all documents necessary to implement the Plan. ADOPTED this 27th day of November, 2007 t roly .cche, Mayor rty of Orange 1 1'1C'I'EST: Mary E urp , City C of Orange I, MARY E. MURPHY, 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 27th day of November, 2007, by the following vote: AYES: COIJNCILMEMBERS: Smith, Cavecche, Dumitru, Bilodeau NOES: COLTNCILMEMBERS: None ABSENT: COUNCILMEMBERS: Murphy ABSTAIN: COLTNCILMEMBERS: None r Mary E City er , ' Orange 2 EMPLOYER VANTAGECARE RETIREMENT HEALTH SAVINGS (RHS) PLAN ADOPTION AGREEMENT Plan Number: 8 a / Check one: New Plan Amendment to Existing Plan Employer Retirement Health Savings Plan Name: I. Employer Name: vry 4 7 l t/1 e ' w/• //l Gt'!R°L/i; C// II. The Employer hereby attests that it is a unit of a state or local government or an agency or instrumentality of one or more units of a state or local government. III. Effective Date of the Plan: ` O IV. The Employer intends to utilize the Trust to fund only welfarf benefits pursuant to the following welfare benefit plan(s) established by the Employer: M oc w--lZ+.r-e la V. Eligible Groups,Participation and Participant Eligibility Requirements A. Eligible Groups The following group or groups of Employees are eligible to pazticipate in the VantageCare Retirement Health Savings Plan(check all applicable boxes): All Employees All Full-Time Employees Non-Union Employees Public Safety Employees—Police Public Safety Employees—Firefighters General Employees Collectively-Bargained Employees(Specify unit(s)) Other(specify group(s)) 1 le /'I?a a m enf ,S.f U V'' The Employee group(s)specified must correspond to a group(s)of the same designation that is defined in the statutes, ordinances,rules,regulations,personnel manuals or other documents or provisions in effect in the state or locality of the Employer. B. Participation Mandatory Participation:All Employees in the covered group(s) are required to participate in the Plan and shall receive contributions pursuant to Section VI. If the Employer's underlying welfare benefit plan or funding under this VantageCare Retirement Healch Savings Plan is in whole or parra non-collectively bargained,self-insured'plan,the nondiscrimination requitements afIntercial Rtiveriue Code, IRC),Section 105(h)will apply. T,hese rulcs may impose,taxation on the,beqefits;recei by highly com ensated individuals, ; if the Plan discriminates in favor of highly compensated individuals in tcrms of eligibdiry or benefits The Employer shouldf:_ discuss these rules with appropriate counseL C. Participant Eligibility Requirements 1. Minimum service: The minimum period of service required for participation is(write N/A if an Employee is eligible to participate or to elett to participate immediately upon employment). 2. Minimum age:The minimum age required for eligibility to participate is Nl (write N/A if no minimum age is required). VI.Contribution Sources and Amounts A. Definition of Earnings The definition of Earnings will apply to all RHS Contribution Features that reference"Earnings",including Direcc Employer Contributions(Section VI.B.1.)and Mandatory Employee Compensation Contributions(Section VI.B.2.). Definition of earnings: B. Direct Employer Contributions and Mandatory Contributions 1. Direct Employer Contributions The Employer shall contribute on behalf of each Participant of Earnings each Plan Year A discretionary amount to be determined each Plan Year Other(describe): 2. Mandatory Employee Compensation Contributions The Employer will make mandatory contributions of Employee compensation as follows: Reduction in Salary- of Earnings or$ will be contributed for the Plan Year. Decreased Merit or Pay Plan Adjustment-All or a portion of the Employees' annual merit or pay plan adjustment will be contributed as follows: An Employee shall not have the right to discontinue or vary the rate of Mandatory Contributions of Employee Compensation. 3. Mandatory Employee Leave Contributions The Employer will make mandatory contributions of accrued leave as follows(provide formula for determining Mandatory Employee Leave contributions): Accrued Sick Leave 1 Y.GI q I b l C 4.S b u't 1 2 DQ i c 7 S'PiYJ r Csz Accrued Vacation Leave UC' .P./i/b l G I 6 fi k O' 5 Ov fi K m S-a vi Other(specify rype of leave)Accrued Leave I rjl%a d a.Q a`I..er G.cur 9 f e,t Va-,U. r•.`"— S A h-G?SY -o m .ii'I C..e An Employee shall not have the right to discontinue or vary the rate of mandatory leave contributions. C. Limits on Total Contributions(check one box) The total contribution by the Employer on behalf of each Participant(including Direct Employer and Mandatory Employee Contributions) for each Plan Year shall not exceed the following limit(s) below Limits on individual contribution rypes are defined within the appropriate section above. There is no Plan-defined limit on the percentage or dollar amount of earnings that may be conuibuted. of earnings* Definition of earnings: Same as Section VI.A.. Other for the Plan year. See Section V.B.for a discussion of nondiscrimination rules that may apply to non-collectively bargained self-insured Plans. VII.Vesting for Direct Employer Contributions A. Vesting Schedule(check one box) The account is 100%vested at all times. The following vesting schedule shall apply to Direct Employer Contributions as outlined in Section VI.B.1.: Yeazs of Service Vesting Completed Percentage o o B. The account will become 100%vested upon the death,disability,retirement*,or attainment of benefit eligibility(as outlined in Section IX)by a Pazticipant. Definition of retirement(check one box): Recirement as defined in the primary retirement plan of the Employer Sepazation from service Other C. Any period of service by a Participant prior to a rehire of the Participant by the Employer shall not count toward the vesting schedule outlined in A above. VIII.Forfeiture Provisions Upon separation from the service of the Employer prior to attainment of benefit eligibility(as outlined in Section IX),or upon reversion to the Trust of a Participant's account assets remaining upon the participant's death(as outlined in Section XI),a Participant's non-vested funds shall(check one box): Remain in the Trust to be reallocated among all remaining Employees participating in the Plan as Direct Employer Contributions for the next and succeeding contribution cycle(s). Remain in the Trust to be reallocated on an equal dollar basis among all Plan Participants. Remain in the Trust to be reallocated among all Plan Participanu based upon Participant account balances. Revert to the Employer. IX.Eligibility Requirements to Receive Medica!Benefit Payments from the VantageCaze Retirement Health Savings Plan A. A Participant is eligible to receive benefits: At retirement only(also complete Section B.) Definition of retirement: Same as Section VII.B. Other At separation from service with the following restrictions No restrictions Other At age only At retirement and age also complete section B) Definition of retirement: Same as Section VII.B. Other At retirement or age Definition of retirement: Same as Section VII.B. Other Other, specified as follows (also complete Section B if applicable): B. Termination prior to general benefit eligibility: In the case where the general benefit eligibility as outlined in Section IX.A includes a retirement component,a Participant who separates from the setvice of the Employer prior to retirement will be eligible to receive benefits: Immediately upon sepazation from service. At age C. A Participant that becomes totally and permanently disabled as defined by the Social Securiry Administration as defined by the Employer's primary reurement plan other will become immediately eligible to receive medical benefit payments from his/her VantageCare Retirement Health Savings Plan account. D. Upon the death of the Participant,benefits shall become payable as outlined in Section XI. B. No Surviving Spouse or Surviving Dependents If there are no living spouse or dependents at the time of death of the Participant,the account will revert to the Plan to be applied as specified in Section VIII. XII.The Plan will operate according to the following provisions: A. Employer Responsibilities 1. The Employer will submit all VantageCare Retirement Health Savings Plan contribution data via electronic submission. 2. The Employer will submit all VantageCare Retirement Health Savings Plan Participant status updates or personal information updates via electronic submission. This includes but is not limited to termination notification and benefit eligibility notification. B. Participant account administration and asset-based fees will be paid through the redemption of Participant account shares,unless agreed upon otherwise in the Administrative Services Agreement. C. Assignment of benefits is not permitted. Benefits will be paid only to the Participant,his/her Survivors,the Employer,or an insurance provider(as allowed by the claims administrator). Payments to an third-party payee e.g.,medical service provider) are not permitted with the exception of reimbursement to the Employer or insurance provider(as allowed by the claims administrator). D. An eligible dependent is the Participant's lawful spouse and any other individual who is a person described in IRC Section 152(a),as clarified by Internal Revenue Service Notice 2004-79. E. The Employer will be responsible for withholding, reporting and remitting any applicable taxes for payments which are deemed to be discriminatory under IRC Section 105(h),as outlined in the VantageCare Retirement Health Savings Plan Employer Manual. XIII.Employer Acknowledgements A. The Employer hereby acknowledges it understands that failure to properly fill out this Employer VantageCare Retirement Health Savings Plan Adoption Agreement may result in the loss of tax exemption of che Trust and/or loss of tax-deferred status for Employer contributions. B. Check this box if you are including supporting documents that include plan provisions. EMPIAYER TU y: Date: Titl a V avecche a or Attest• Date: Title:Ntary E. Mlur Ci clerk Accepted:VANTAGEPOINT TRANSFER AGENTS,LLC 1 Assistant Secretary X. Permissible Medical Benefit Payments Benefits eligible for reimbursement consist of: All Medical Expenses eligible under IRC Section 213*other than direct long-term care expenses,and including non-prescription medications allowed under IRS guidance. The following Medical Expenses(select only the expenses you wish to cover under the VantageCare Retirement Health Savings Plan): Medical Insurance Premiums Medical Out-of-Pocket Expenses* Medicare Part B Insurance Premiums Medicare Part D Insurance Premiums Q Medicare Supplemental Insurance Premiums Prescription Drug Insurance Premiums COBRA Insurance Premiums Dental Insurance Premiums Dental Out-of-Pocket Expenses* Vision Insurance Premiums sion Out-of-Pocket Expenses* Qualified Long-Term Care Insurance Premiums Non-Prescription medications allowed under IRS guidance* Other qualifying medical e cpenses(describe)* See Section V.A.for a discussion of nondiscrimination rules which may apply to non-collectively bargained,self-insured Plans. XI.Benefits After the Death of the Participant In the event of a Participant's death,the following shall apply: A. Surviving Spouse and/or Surviving Dependents The surviving spouse and/or surviving eligible dependents(as defined in Seaion XII.D.)of th e deceased Participant aze immediately eligible to maintain the account and utilize it to fund eligible medical benefiu specified in Section X ab ve. Upon notification of a Participant's death,the Participant's account balance will be transferred inta the Vantagepoint Money Market Fund*(or another fund selected by the Employer). The account balance may be reallocated by the surviving spouse or dependents. Please read the current[/antagepoint Mutual Funds prospectus carefully prinr to investing.An investment in this fund is neither insured nor guaranteed and there can be no assuranc that the Fund will be able to maintain a stable net asset value of$1.00 per share. T/antagepointMutual Funds are distributed by ICMA-RC Servica,LLC,a whally-owned broker-dealer af"zliate ofICMA Retiremen: Corporation.Member NASD/SIPC. If a Participant's accounc balance has not been fully utilized upon the death of the eligible spouse,the account balance may continue to be utilized to pay benefits of eligible dependents.Upon the death of all eligible dependents,the account will revert to the Plan to be applied as specified in Section VIII.