HomeMy Public PortalAboutRES 99/01RESOLUTION 99 -1
A RESOLUTION OF THE TOWN COMMISSION OF THE TOWN OF
GULF STREAM, PALM BEACH COUNTY, FLORIDA, ESTABLISHING
THE TOWN OF GULF STREAM PREMIUM ONLY PLAN, A "CAFETERIA
PLAN "; AUTHORIZING THE TOWN MANAGER TO EXECUTE PLAN
DOCUMENTS; AND ESTABLISHING AN EFFECTIVE DATE.
WHEREAS, the Town of Gulf Stream has determined it is
desirable to establish a "cafeteria plan" within the meaning of
Section 125 of the Internal Revenue Code, as amended from time to
time, to provide certain benefits to the Employees of the Town
of Gulf Stream:
NOW, THEREFORE, BE IT RESOLVED BY THE TOLM COMMISSION OF
THE TOWN OF GULF STREAM, FLORIDA THAT:
Section 1. The Town of Gulf Stream hereby establishes the
it plan" TOWN OF GULF STREAM PREMIUM ONLY PLAN attached
hereto as Appendix "A ", said Appendix "A" being a part of this
Resolution as if fully set forth herein.
Section 2. The Town Commission of the Town of Gulf Stream
hereby authorizes the Town Manager to execute such plan documents.
Section 3. This Resolution shall become effective February
15, 1999.
PASSED AND ADOPTED this 5th day of February, 1999.
(SEAL)
T041N GULF STREAP1, FLORIDA
ISSIONER
J•
SSIONER
SSIONER
ATTEST: COMMISSIONER
OWN CLERK
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CASE NUMBER: BA04708
0149801
TOWN OF GULF STREAM PREMIUM ONLY PLAN
Effective: October 1, 1996
Amended and Restated Effective: February 15, 1999
COPYRIGHT 1998 THE BARRINGTON GROUP, LTD.
USED WITH PERMISSION BY BENEFIT AMERICA
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TABLE OF CONTENTS
ARTICLE I PURPOSE OF PLAN
Section 1.01 Purpose.
ARTICLE II DEFINITIONS
Section 2.01 Defined Terms.
Section 2.02 Construction.
ARTICLE III ELIGIBILITY
Section 3.01 Eligibility to Participate.
Section 3.02 Participation Requirements.
ARTICLE IV BENEFITS
Section 4.01 Benefit Options.
Section 4.02 Premium Payment Option.
ARTICLE V BENEFIT ELECTION PROCEDURES
Section 5.01 Benefit Elections.
Section 5.02 Failure to Enroll.
Section 5.03 Automatic Termination of Participation.
Section 5.04 Election Modifications Required by the Administrator.
ARTICLE VI PREMIUM PAYMENT
Section 6.01 Premium Payment Authorization.
Section 6.02 Automatic Termination of Authorization.
Section 6.03 Payment During Leave.
ARTICLE VII NONDISCRIMINATION
Section 7.01 Nondiscrimination.
ARTICLE VIII GENERAL PROVISIONS
Section 8.01 Administration.
Section 8.02 Amendment and Termination.
Section 8.03 Termination of Employment.
Section 8.04 Exclusive Benefit.
Section 8.05 Spendthrift Clause.
Section 8.06 Employer Liability.
Section 8.07 Related Employers.
Section 8.08 Governing Law.
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THE TOWN OF GULF STREAM PREMIUM ONLY PLAN
ARTICLE I. PURPOSE OF PLAN.
Section 1.01. Purpose. The purpose of this Plan is to furnish eligible Employees of the Employer with
a choice of receiving certain taxable or non - taxable benefits. It is intended that this Plan qualify as a
"cafeteria plan" within the meaning of Section 125(d) of the Code, and that certain benefits which an
eligible Employee elects to receive be eligible for exclusion from such Employee's income under Section
125 of the Code.
ARTICLE II. DEFINITIONS.
Section 2.01. Defined Terms.
(a) "Administrator" means the Employer, or any other person or organization subsequently
designated as such by Town of Gulf Stream with the authority and responsibility to
manage and administer the Plan.
(b) "Cash Option" means the option where the Employee receives his full compensation in
cash forgoing the Premium Payment Option.
(c) "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of 1986, as
amended.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Compensation" means W -2 wages and other taxable compensation from the Employer
for any Plan Year.
(f) "Effective Date" means October 1, 1996.
(g) "Employee" means any common law Employee of the Employer.
(h) "Employer" means Town of Gulf Stream or its successor(s). However, where appropriate,
the term "Employer" shall also mean an Affiliate that is the employer of a particular
Participant.
(i) "Employer Credits" means dollar to the Plan with respect to a Participant made
independently by the Employer which may be used for purposes of purchasing benefits
through the Plan.
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(j) "FMLA Leave" means a leave of absence provided to an Employee of the Employer
under the Family and Medical Leave Act of 1993, as amended.
(k) "Highly Compensated Individual" means a highly compensated individual as defined in
Code Section 125 (e)(2).
(1) "Highly Compensated Participant" means a highly compensated participant as defined in
Code Section 125 (e)(1).
(m) "Insurance Plan" means the plan(s) maintained by the Employer to provide accident and
health benefits and /or group term life to the Employer's Employees, which is partially or
fully insured by an independent third party.
(n) "Key Employee" means a Key Employee as defined in Code Section 416 (i)(1).
(o) "Participant" means any Employee of the Employer who, on or after the Effective Date
applies to participate in the Plan and meets the requirements of Section 3.01.
(p) "Premium Payment Option" means the option to pay Insurance Plan premiums on a
pre -tax basis through the Plan.
(q) "Plan" means the cafeteria plan herein contained, as amended from time to time, which
shall be known as "THE TOWN OF GULF STREAM PREMIUM ONLY PLAN."
(r) "Plan Year" means the twelve (12) month period beginning October 1 and ending
September 30.
Section 2.02. Construction. Wherever appropriate, words used in the singular may include the plural,
or the plural may be read as the singular; and the masculine may include the feminine.
ARTICLE III. ELIGIBILITY.
Section 3.01. Eligibility to Participate.
(a) An Employee who regularly works 35 hour(s) per week and has completed a period of 30
day(s) of consecutive employment with the Employer may become a Participant in the
Plan, counting periods that an Employee is on leave required under FMLA or during an
absence from work for duty in the uniformed service of the United States of America.
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(b) Any former Employee within a collective bargaining unit shall become eligible to
participate in this Plan only upon agreement between the Employer and the Employee's
bargaining representative or written direction by the Employer after satisfaction of any
collective bargaining obligation under the National Labor Relations Act. Any such
Employee's date of participation shall be that determined through collective bargaining, or
as may otherwise be lawfully determined by the Employer.
3.02. Participation Requirements
(a) An Employee of the Employer who makes an election to allocate contributions to the
Plan shall become a Participant on the latter of:
(i) The Effective Date; or
The first day of the month coincidental with or next following the date the
Employee completes the standards of Section 3.01.
(b) Any Participant whose employment with the Employer terminates because of a bonafide
termination, and who is rehired, may be reinstated as a Participant, on the first day of the
month coincidental with or next following the date the Employee completes 30 day(s) of
consecutive employment.
(c) Notwithstanding anything in this Section 3.01 to the contrary, the Administrator may, at
any time, exclude one or more Highly Compensated Individuals or Key Employees from
participation in the Plan if such exclusion is necessary to maintain the statutory
non - taxable status of benefits received under this Plan by other Key Employees. Such
exclusion shall be accomplished in a nondiscriminatory manner and shall be based on such
facts and circumstances as the Administrator deems to be appropriate.
ARTICLE IV. BENEFITS.
Section 4.01. Benefit Options. A Participant may, pursuant to the procedures described in Article V:
(a) Elect to receive the Cash Option, or to have a portion of it applied by the Employer
toward the cost of the Premium Payment Option described below:
(b) Elect to have any Employer Credits allocated under this Plan applied by the Employer
toward the cost of the Premium Payment Option described below:
(i) The amount of Employer Credits shall be determined annually by the Employer
and communicated to Participants and Eligible Employees during the enrollment
period in a timely fashion. Employer Credits will be available for application
under the Plan ratably with respect to each payroll period during a Plan Year.
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Employer Credits may be applied with respect to the Premium Payment Option
toward the cost of premiums for the Insurance Plan(s) for the coverage elected by
the Participant. Employer Credits may be applied with respect to any of the
Insurance Plans providing accident or health benefits and /or group term life
benefits.
Section 4.02. Premium Payment Option. Benefits shall be provided through, and in accordance with the
provisions of the Insurance Plan(s). The maximum amount of Employer Credits and Compensation a
Participant may elect to have applied on a pre -tax basis toward the cost of the Premium Payment Option
for any Plan Year or a portion thereof is the cost of premiums under the Insurance Plan(s) for the
coverage elected by the Participant, which shall not exceed twenty thousand dollars ($20,000).
ARTICLE V. BENEFIT ELECTION PROCEDURES.
Section 5.01. Benefit Elections.
(a) The Administrator shall prescribe suitable forms to be utilized by Participants in electing
benefit options under the Plan.
(b) The benefit period under the Plan shall be the Plan Year. Benefit elections for any Plan
Year shall be made, in accordance with procedures prescribed by the Administrator, prior
to or, in the case of a new Participant, prior to his effective date of participation in the
Plan.
(c) There will be an enrollment period during which the Employees can enroll in and select
benefits available under the Plan prior to;
(i) The first day of a Plan Year during which an Employee is eligible to participate
in the Plan; or
The first day, during a Plan Year, of the month after the date that a new
Employee becomes eligible to participate in the Plan, in accordance with the
standards of Section 3.01.
(d) An enrollment form must be completed and returned to the Administrator prior to the
end of the enrollment period for an election to be effective.
(e) Prior to the beginning of each subsequent Plan Year with respect to which this Plan
continues in effect, there will be an enrollment period during which a Participant will
have the opportunity to elect a different or new benefit election under the Plan effective
for the subsequent Plan Year.
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(f) A benefit election for any Plan Year shall be irrevocable; provided, a Participant may
revoke or modify a benefit election during a current Plan Year if the revocation or
modification is on account of a change in the Participant's status. A change in status shall
be determined in accordance with regulations promulgated by the Internal Revenue
Service under IRC Section 125. Any revocation or modification must be consistent with
the reason such revocation or modification was permitted. Any such revocation or
modification shall be on a form prescribed by the Administrator and shall be effective as
of the first pay period after such form is completed and returned to the Administrator.
(g) A Participant may revoke or modify a benefit election during a current Plan Year if the
revocation or modification is on account of a Qualified Medical Child Support Order
(QMCSO) under 29 USC Section 1169(a) or on account of the special enrollment rights
of the Health Insurance Portability and Accountability Act of 1996 (HIPAA).
(h) A Participant, on account of an FMLA, leave may revoke his benefit election. When he
returns from FMLA Leave after having revoked his benefit elections may have his benefit
elections reinstated on the same terms as prior to taking FMLA Leave, to the extent that
reinstatement is required under the FMLA Leave. A reinstated Participant shall not have a
greater right to benefits for the remainder of the Plan Year that a Participant who is
continuously working during the Plan Year as promulgated by the Internal Revenue
Service under IRC Section 125.
Section 5.02. Failure to Enroll.
(a) If an Employee fails to return an initial election form prior to the end of the enrollment
period, the Employee will be deemed to have elected the Cash Option. However, an
eligible Employee will be allowed to make an election to participate in the Plan during a
succeeding enrollment period if he or she wishes.
(b) If a participant does not return an election form for a subsequent Plan Year, then that
Participant shall be considered to have made the same elections as in the prior Plan Year,
subject to the current terms, conditions, and limitations of each benefit option available at
that time.
Section 5.03. Automatic Termination of Participation. Participation under this Plan shall automatically
terminate on the date on which the Participant's employment with the Employer terminates.
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Section 5.04. Election Modifications Required by Administrator.
(a) Notwithstanding anything in this Plan to the contrary, the Administrator may, at any time,
require all or any class of Employees to amend the amount of any Premium Payment
Option authorization by them for a Plan Year or the Administrator may take such other
actions as it deems appropriate in the event the Administrator determines that such
amendments or other actions are necessary or advisable in order to:
(i) Satisfy the nondiscrimination requirements imposed on this Plan by any provision
of the Code and any rules or regulations issued pursuant thereto;
Prevent any Participant or class of Participants from having to recognize more
income for Federal income tax purposes from the receipt of optional benefits
hereunder than would otherwise be recognized due to the application of any
provision of the Code, or rules or regulations issued pursuant thereto; or
Maintain the statutory nontaxable status of benefits received under this Plan
pursuant to the requirements of the applicable provisions of the Code, including,
without limitation, a modification of elections by Highly Compensated
Participants or Key Employees, with or without the consent of such Employees.
(b) The Administrator may divide Employees into two or more classes for purposes of this
Section 5.04 provided that such classification shall be nondiscriminatory, based on such
facts and circumstances as the Administrator determines to be appropriate including, but
not limited to, scheduled hours or other relevant considerations. Any required amendment
of elections as permitted by this Section 5.04 shall be made pursuant to and in accordance
with such rules, regulations and procedures as the Administrator may from time to time
adopt in the exclusive exercise of its discretion.
ARTICLE VI. PREMIUM PAYMENT.
Section 6.01. Premium Payment Option Authorization.
(a) Each Participant who timely elects the Premium Payment Option under Article IV must
authorize the Employer to reduce his Compensation for the Plan Year or allocate
Employer Credits under this plan in an amount equal to the Participant's cost of
premiums under the Insurance Plan(s) for coverage elected by the Participant, subject to
automatic adjustment in the event of a change in the cost of the Insurance Plan(s).
(b) Premium Payment Option authorizations for any Plan Year shall be entered into, in
accordance with procedures prescribed by the Administrator, prior to the first day of the
Plan Year or, in the case of a new Participant, prior to his effective date of participation
in the Plan.
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(c) A Premium Payment Option authorization for any Plan Year shall be irrevocable as
provided in Section 5.01(f). A Participant may, however, revoke or modify a Premium
Payment Option authorization during a current Plan Year if the revocation or
modification is on account of a change in the Participant's status. Additionally, if the
premium amount of an Insurance Plan significantly increases or the coverage of an
Insurance Plan is significantly curtailed or modified, a Participant may revoke a Premium
Payment Option authorization during a current Plan Year and, in lieu thereof, receive on
a prospective basis coverage under another Insurance Plan with similar coverage, if similar
coverage is available. A change in status shall be determined in accordance with
regulations promulgated by the Internal Revenue Service under IRC Section 125. Any
such revocation or modification must be consistent with the reason such revocation or
modification was permitted. Any such revocation or modification shall be on a form
prescribed by the Administrator and shall be effective as of the first pay period after such
form is completed and returned to the Administrator.
Section 6.02. Automatic Termination of Authorization. Premium Payment Option authorizations made
under this Article shall automatically terminate on the date on which the Participant's employment with
the Employer terminates.
Section 6.03. Payment During Leave. With respect to Participants who go on leave which is
Employer- approved or FMLA Leave, contributions required or permitted to be made by them under the
Plan may be made by one of the following methods, which must be nondiscriminatory, as agreed between
the Employee on leave and the Employer before the commencement of the leave of absence or the
applicable coverage period:
(a) Contributions may be made by the Employee on leave on a regular basis (generally on an
after -tax basis);
(b) Contributions may be made by the Employee on leave by pre - payment (generally on a
pre -tax basis with respect to the same Plan Year during which the leave occurs); or
(c) Contributions advanced by the Employer on behalf of the Employee on leave may be
re -paid by the Participant when he returns from leave on either a pre -tax with respect to
the same Plan Year during which the leave occurs or on after -tax basis.
(d) Contributions may be revoked by the Employee on FMLA Leave and when he returns
from leave, he may reinstate those contributions according to Section 5.01(h)
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ARTICLE VII. NONDISCRIMINATION.
Section 7.01. Nondiscrimination.
(a) Notwithstanding anything in this Plan to the contrary, this Plan shall not discriminate in
favor of Highly Compensated Individuals as to eligibility to participate.
(b) Notwithstanding anything in this Plan to the contrary, this Plan shall not discriminate in
favor of Highly Compensated Participants as to contributions or benefits.
(c) The statutory non - taxable benefits provided to Key Employees under the Plan shall not
exceed 25% of the aggregate of such statutory non - taxable benefits provided for all
Employees under the Plan.
(d) All Employees who are treated as employed by a single employer under subsections (b),
(c) or (m) of Section 414 of the Code shall be treated as employed by a single employer
for purposes of this Article VII.
ARTICLE VIII. GENERAL PROVISIONS.
Section 8.01. Administration.
(a) The Administrator shall serve at the pleasure of the Employer or designated officer of the
Employer. The Administrator shall construe and interpret this Plan, and shall decide all
questions of eligibility and benefits.
Any such determination and decision of the Administrator shall be final, conclusive, and
binding upon all parties affected thereby, unless arbitrary and capricious. This Plan is
intended to be interpreted in accordance with and qualify as a "cafeteria plan" under
Section 125 of the Code. To the extent any provisions contained herein are inconsistent
with this Code section, such provisions are hereby modified to conform therewith.
(b) The Administrator shall establish uniform rules, procedures and interpretations as
appropriate for the administration of the Plan, to be consistently applied to all
Participants in like circumstances.
(c) Any administrative discretion under the Plan shall be based solely on clearly defined and
ascertainable criteria set forth in the Plan.
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Section 8.02. Amendment and Termination. This Plan may be amended or terminated at any time by the
Employer. Upon termination of the Plan, Participant's benefits shall become payable as the Employer
may direct. The Employer shall inform the Participants of any changes, amendments or termination of
this Plan.
Section 8.03. Termination of Employment. If a Participant has authorized the Premium Payment Option
and that Participant's employment terminates for any reason, the Participant shall continue to receive
such benefits to the extent provided for by the terms of the Insurance Plan(s).
Section 8.04. Exclusive Benefit. Amounts available for elective use under this Plan shall be used for the
exclusive benefits of Employees and their dependents. The Plan, however, does not grant any Employee
the right to be retained in the service of the Employer.
Section 8.05. Spendthrift Clause. Benefits payable under this Plan may not be assigned, alienated,
transferred, pledged or encumbered, nor shall any such benefit be subject to claims of or seizure by legal
process by creditors.
Section 8.06. Employer Liability.
(a) Benefits payable under this Plan will be paid solely from the general assets of the
Employer, without interest or earned credit of any kind.
(b) No Employee, Participant, dependent or beneficiary shall have any right or interest in any
assets of the Employer upon termination of this Plan, their employment or otherwise,
except as specifically provided under this Plan, and then only to the extent of the benefits
payable under this Plan.
Section 8.07. Related Employers. If the Employer is a member of a controlled group of corporations, the
Employer may, by resolution, authorize other members of the controlled group to adopt this Plan.
Section 8.08. Governing Law. To the extent the laws of any State shall apply, this Plan shall be
construed, administered and enforced in accordance with the laws of the State of Florida.
IN WITNESS WHEREOF, the Employer has caused this Plan to be executed as of the Effective Date.
Date: 2 5 q
By:
Attest: