Resolution 2818-06
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5 WHEREAS, the South Tahoe Public Utility District ("District") has employees
6 rendering valuable services; and
7 WHEREAS, the establishment of a retiree health savings plan for such
8 employees serves the interests of the District by enabling it to provide reasonable
9 security regarding such employees' health needs during retirement, by providing
10 increased flexibility in its personnel management systems, and by assisting in the
11 attraction and retention of competent personnel; and
12 WHEREAS, the District has determined that the establishment of the retiree
13 health savings plan ("Plan") serves the above objectives;
14 NOW, THEREFORE BE IT RESOLVED, that the District hereby adopts the Plan
15 in the form of the ICMA Retirement Corporation's VantageCare Retirement Health
16 Savings Program.
17 BE IT FURTHER RESOLVED, that the assets of the Plan shall be held in trust,
18 with the General Manager, Chief Financial Officer and Human Resources Director
19 serving as trustees, for the exclusive benefit of Plan participants and their beneficiaries,
20 and the assets of the Plan shall not be diverted to any other purpose prior to the
21 satisfaction of all liabilities of the Plan. The District has executed the Declaration of
22 Trust of the South Tahoe Public Utility District Integral Part Trust in the form of the
23 model trust made available by the ICMA Retirement Corporation.
24 BE IT FURTHER RESOLVED, that the Human Resources Director shall be the
25 coordinator and contact for the Plan and shall receive necessary reports, notices, etc.
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RESOLUTION NO. 2818-06
A RESOLUTION OF THE SOUTH TAHOE PUBLIC UTILITY DISTRICT
ADOPTING THE VANTAGECARE RETIREMENT HEALTH SAVINGS (RHS)
PROGRAM
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\.; 15 ATTEST:
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Resolution No. 2818-06
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WE, THE UNDERSIGNED, do hereby certify that the above and foregoing
Resolution was duly adopted and passed by the Board of Directors of the South Tahoe
Public Utility District at a regularly scheduled meeting held on the 2nd day of November,
6 2006, by the following vote:
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AYES:
NOES:
ABSENT:
Directors Jones, Schafer, Farrell, Mosbacher
None
Director Wallace
Eric W. S haf ,Board President
South Ta oe Public Utility District
oard
EMPLOYER VANTAGECARE RETIREMENT HEALTH
SAVINGS (RHS) PLAN ADOPTION AGREEMENT
Plan Number: 8
South Tahoe Public Utility District
\.,.r>Ioyer Retirement Health Savings Plan Name: Retirement Health Savings Plan
I E I N South Tahoe Public utility District State,' California
, mp oyer ame:
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. The Effective Date of the Plan: November 2, 2006
IV. The Employer intends to utilize the Trust to fund only welfare benefits pursuant to the following welfare ben-
efit plan(s) established by the EmplQye;r:
South Tahoe Public UtllJ.ty District Retirement Health Savings Plan
Integral Part Trust
V. Eligible Groups and Participant Eligibility Requirements
A. The following group or groups of Employees are eligible to participate in the VantageCare Retirement Health
Savings Plan:
x
All Employees
All Full-Time Employees
Non-Union Employees
Public Safety Employees -- Police
Public Safety Employees -- Firefighters
General Employees
Collectively-Bargained Employees (Specify unit)
Other (specify below)
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The group specified must correspond to a group of the same designation that is defined in the statutes, ordi-
nances, rules, regulations, personnel manuals or other material in effect in the state or locality of the Employer.
m If this box is checked, in lieu of mandatory participation, the Employer provides for a one-time irrevoca-
ble election by eligible Employees to participate in RHS. Until such time as the election is made, the
Employee shall not participate in the Plan or receive contributions pursuant to Section VI.
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Newly eligible Employees shall be provided an election window of days (no more than 60
calendar days} from the date of initial eligibility during which they may make the election to participate.
Participation may begin no earlier than the calendar month following the end of the election window.
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,.',If tf:le,Empl(jve,edgesnot make the election in the year of initial eligibility, the election to participate may
;;,.';.',;:,'Fbemade iris,later yeliir.-An annual election window of 60 . . . . days (no more than. 60 calendar' .
'::{:',~':~,";:d~y:sl 'Shall be provided during which the. election may be made. The election window shall run from
Y;;".3f."f', '10/15:'4/:' . to'. 12/15,' '" . (in'sert your annual time frame.for the election window, e.g. October 1 to
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,;<~;",,'No\l~mbef 29t~ Participation may begin no earlier than the calendar 'year following the year of the elec-
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,';;~i {/, O~cemaae, iheelectiorllsirrevocableand may not be revoked whUe the participant is a membfnofthe
~J~'''':;;::gt()fi-p~c6v~r~dbv.theRHSplalt' '.... .' '; .... "','. ;', .... ',.," :, '.' .:' ; . ,', ..... .;' . · ',-. '. :'. . .'
~; E~~I~;er:s Un~e;IYing welfare benefit plan or funding under this VantageCare R~tireme'nt Health ~aVingS .
Plan is in whole or part a non-collectively bargained, self-insured plan, the nondiscrimination requirements of
Internal Revenue Code (IRCl Section 105(h) will apply. These rules may impose taxation on the benefits received
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by highly compensated Employees if the Plan discriminates in favor of highly compensated Employees in terms
of eligibility or benefits. The Employer should discuss these rules with appropriate counsel.
B. Participant Eligibility
\.,. Minimum period of service required for participation is 6 mos'(write N/A if an Employee is eligible to partici-
pate or to elect to participate immediately upon employment).
2. Minimum age required for eligibility to participate is n/a (write N/A if no minimum age is required).
VI.Contribution Sources and Amounts
A. Mandatory Contributions
o 1. Direct Employer Contributions
The Employer shall contribute on behalf of each Participant _% of earnings or $
Year.
for the Plan
Definition of earnings:
o 2. Mandatory Leave Contributions
The Employer will make mandatory contributions of leave as follows:
Accrued Sick Leave* 0 Yes
o No
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Accrued Vacation*
DYes
o No
Other* (describe)
o Yes
o No
* Please provide the formula for determining the Accrued Leave contribution:
An Employee shall not have the right to discontinue or vary the rate of annual leave contributions.
o 3. Mandatory Employee Compensation Contributions
The Employer will make mandatory contributions of Employee compensation as follows:
o Reduction in Salary - % of earnings (as defined in VI.A.1.) or $
contributed for the Plan Year.
will be
o Decreased Merit or Pay Plan Adjustment - Allor 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.
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. B. Elective Contributions
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1. Elective Pre~Tax Contributions
'- ,Employer will permit each Employee to make the following elections to make pre-tax
.ributions to the Plan:
~ a.lrrevocahleElection for Pre-Tax Contributions from Compensation: A one-time, irrevocable election of
the amount of Employer contributions of compensation made on his or her behalf.
The Employer limits the amount elected to either a fixed percentage or a range of percentages of an
Employee's earnings
1 % of earnings (as defined in VI.A.1.) or up to IS % of earnings (as defined in
VI.A.1) for the Plan Year. All elections will be in whole percentages.
Newly eligible Employees shall be provided an election window of 60 days (no more than 60)
from the date of initial eligibility during which they may make the elec.tion to contribute. Contributions
may begin no earlier than the calendar month following the end of the election window.
If the Employee does not make the election in the year of initial eligibility, the election to contribute may
be made in a later year. An annual election window of 60 days (no more than 60) shall be
provided during which the election may be made. The election window shall run fromlO/lS ~ ~ to
12/15 (insert your annual time frame for the election window). Contributions may begin no ear-
lier than the calendar year following the year of the election.
Once made, the election is irrevocable and may not be revoked.
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b. Irrevocable Election for Pre-Tax Contributions of Accrued Leave: A one-time, irrevocable election of
the amount of employer contributions of Employee accrued
canpensatory time and
I1J other holiday pay (describe) leave made on his or her behalf.
I1J sick
~ Yes
gJ vacation
o No
The EmplQver limits the amoullt,electe.d ps shown bel.ow: t staff and
M.eT16rahdums ot Understandmg WJ. th UIllon and. managemen
individual anp~oyment contracts.
Newly eligible Employees shall be provided an election window of 60 days (no more than 60
calendar days) from the date of initial eligibility during which they may make the election to contribute.
Contributions may begin no earlier than the calendar month following the end of the election window.
If the Employee does not make the election in the year of initial eligibility, the election to contribute may
be made in a later year. An annual election window of 60 days (no more than 60 calendar
days}shall be provided during which the ~Iection may be made. The election window shallron from
10/15. ' to. 12/lS1 (insert your annual time frame for the election window). Contributions may
begjnnc;>earUerthan the calendaryear following the year of the electiOn.
Oripe made, the election is irrevocable andrnay not be revoked,
~ " JJ c. AnfJualProspective ElectJon for Pre-Tax Contributions of Leave: An annual, irrevocable election to
~. ,ha~e his Of" her tJ sickLJ vacation a other (describe) leave to be accrued in the next
~><::if:-: 'J,'I"("i,i1>':{::;'I:'<:,,,~_ ;:",.::,::"3',.: i:\:: _">",' :;;.':' _ _ " _ __,o:F '''_, _ ':-- ' __,'
f; \..r' calendar yeal contributed to the Plan on his or her behalf.
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','nieEmployef 'limits the amo~nt elected as shown below:
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,; "Contributions offuture leave accruals will be remitted to the, Plan '
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" ~,:~~~arned' :: LJ at the end of the calen~aryear.
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" The' election to, cqntribute must be made in the calendar year before the year in which contributions are to'
, begIn;' Once made, the election shall apply to succeeding calendar years unless otherwise revised or
revoked by the Employee on an annual basis. ,
An annual election window of~days (no more than 60 calendar days) is provided during which eligible
Employees may make the election to contribute. The election window shall run from10/15 to 12/15
(insert your annual time frame for the election Window).
In adopting section a, b, and/or c, the Employer acknowledges that the Internal Revenue Service has not
,ruled on irrevocable election contributions in an integral part trust. ICMA-RC has obtained the advice of
, counsel that such comributions are allqwable under the conditions outlined in this Adoption Agreement. The
Employer should discuss this issue with appropriate counsel. '
2. Volunfary After-Tax Contributions
Each Employee may contribute up to ~% of earnings (as defined in VI.A.1.) or $ for the Plan Year on
a voluntCiry after-tax basis. In no event may aggregate Employee voluntary after-tax contributions exceed 25%
of total contributions in any Plan Year.
An Employee shall have the right to discontinue or vary the rate of elective after-tax contributions of Employee
earnings.
~ adopting this section, the Employer acknowledges that the Internal Revenue Service has declined to rule on
~mployee after tax contributions in an integral part trust. ICMA-RC has obtained the advice of counsel that such
contributions are allowable in an insubstantial amount (i.e. no more than 25% of total contributions in any Plan
Year). The Employer should discuss this issue with appropriate counsel.
C. Limits on Total Contributions
The total contribution on behalf of each Participant (including both Mandatory and Elective
Contributions) for each Plan Year shall not exceed the following limit(s):
o
0$
[2J
% of earnings (as defined in VIA1.).
There is no Plan-defined limit on the percentage or dollar amount of earnings that may
be contributed.
Limits on individual contribution types are defined within the appropriate section above.
See Section V.A. for a discussion of nondiscrimination rules that may apply to non-collectively bargained self-
insured Plans.
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VII. Vesting Schedule
A. The account is 100% vested at all times, unless specified otherwise in B. below.
'-'The following vesting schedule applies to Direct Employer Contributions outlined in V I. A. 1 :
Years of Specified
Service Percent
Completed Vesting
%
%
%
%
%
%
%
%
%
C. The account will become 100% vested upon the death, disability, retirement, or attainment of
benefit eligibility by a Participant.
Definition of retirement: Separation frcm service.
D. 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 B. above.
VIII. Forfeiture Provisions
Upon separation from the service of the Employer or upon reversion to the Trust of a Participant's account
\..,3ts remaining upon the participant's death (as outlined in Section XI), a Participant's non-vested funds shall:
o Remain in the Trust to be reallocated among all Plan Participant's as Direct Employer Contributions for
the next and succeeding contribution cycle(s).
o Remain in the Trust to be reallocated on an equal dollar basis among all Plan Participants.
!3J Remain in the Trust to be reallocated among all Plan Participants based upon Participant account bal-
ances.
o Revert to the Employer.
In the case of separation from service, the Participant's non-vested funds shall be applied as shown above. In the
case of reversion due to the Participant's death under Section XI, the remaining account assets shall be applied
as shown above.
IX. Eligibility Requirements to Receive Medical Benefit Payments from the VantageCare Retirement Health
Savings Plan
A. A Participant is eligible to receive benefits:
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At retirement only (as defined in Section VII.C.)
At separation from service with the following restrictions
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At age only
At retirement and age
At retirement or age
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B. Termination prior to general benefit eligibility: A Participant who separates from the service of the Employer
prior to attaining benefit eligibility as outlined in Section IX.A. or C. will be eligible to receive benefits:
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lli1 Immediately upon separation from service.
D At age
C. A Participant who dies or becomes totally and permanently disabled (as defined by the Social Security
Administration) will become immediately eligible to receive medical benefit payments from his/her VantageCare
Retirement Health Savings Plan account.
X. Permissible Medical Benefit Payments
Benefits eligible for payment consist of:
A. x All Medical Expenses eligible under IRC Section 213* other than direct long-term care
expenses, OR
B. 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 Supplement Insurance Premiums
COBRA Premiums
Dental Insurance Premiums
Dental Out-of-Pocket Expenses*
Long Term Care Insurance Premiums
Other (Must be eligible under IRC Section 213)*
-.
* See Section V.A. for a discussion of.nondiscrimination rules which may apply to non-collectively bargained,
self-insured Plans.
XI. Death Benefit
In the event of a Participant's death, the following shall apply:
Account Transfer: The surviving spouse and/or surviving eligible dependents (as defined in Section XIII.F.) of the
deceased Participant are immediately eligible to maintain the account and utilize it to fund eligible medical bene-
fits specified in Section X above.
Upon notification of a Participant's death, the Participant's account balance will be transferred into the
Vantagepoint Money Market Fund*. The account balance may be reallocated by the surviving spouse or
dependents.
* Please read the current prospectus carefully prior to investing. An investment in this fund is neither insured
nor guaranteed and there can be no assurance that the Fund will be able to maintain a stable net asset value of
$1.00 per share. Vantagepoint Mutual Funds are distributed by ICMA-RC Services, LLC, a controlled affiliate of
ICMA Retirement Corporation. Member NASD/SIPC.
If a Participant's account 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 depend-
ents,
. If there is no living ~J~e ac<a:unt ~II revert to the
Plan to be applied as specified in Section VIII. eD.g.lbJ.e 'spou or epen ents
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XII. De Minimis Accounts
Upon separation from the service of the Employer prior to a Participant becoming eligible for medical benefits
from a VantageCare Retirement Health Savings Plan account, Participant accounts that are considered de min-
imis as specified below will be paid to the Participant.
o The de minimis account value shall be $5,000 or less.
o The de minimis account value shall be $
$5,000) or less.
(insert dollar amount between $0 and
[31 The Plan shall not allow de minimis account distributions.
XIII. The Plan will operate according to the following provisions:
A. Employer Responsibilities
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The Employer will submit all VantageCare Retirement Health Savings Plan contribution
data via electronic submission.
2. Participant status updates and/or changes or personal information updates and/or changes (Participants'
termination dates, Participants' benefit eligibility dates, etc.) will be provided via electronic submission.
B. Participant account administration fees will be paid through the redemption of Participant account shares,
unless agreed upon otherwise in the Administrative Services Agreement.
C. Employer plan fees will be paid by the Employer as outlined in the Administrative Services Agreement.
D. Assignment of benefits is not permitted.
E. Payments to an alternate payee (payee other than a Participant) are not permitted with the exception of reim-
bursement of health insurance premiums to the Employer.
F. An eligible dependent is the Participant's lawful spouse and any other individual who is a person described in
IRC Section 152(a).
G. The Employer will be responsible for withholding, reporting and remitting any applicable taxes, as outlined
in the VantageCare Retirement Health Savings Plan Employer Manual.
XIV. 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 the
Trust and/or loss of tax-deferred status for Employer contributions.
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EMPLOYER~~
By:
Title: Board.. es' t
'-' Attest: ~../.htJ-<5'.~r &xvdJC/.orL
Accepted: Vantage point Transfer Agents, LLC
tI1.l4iif-
Corporate Secretary
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Funding vehicle
Legal basis
Participation
Types of direct employer
contributions
Income tax treatment of employer con-
tributions
Types of employee contributions
(Pre-tax contributions are treated as
\., employer contributions for tax purposes)
Income tax treatment of employee con-
tributions
FICA treatment of employer and
employee contributions
Annual contribution maximum
~ Annual contribution minimum
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Integral Part Trust
IRS rulings, and Treas. Reg. 301.7701-
1 (a) (3)
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Employer (or Collective Bargaining
Unit) chooses:
1) Mandatory participation
2) Irrevocable election by member of
covered group
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· Sick, vacation, and other accrued leave I
on a mandatory formula basis I
. Pre-tax mandatory contributions from !
compensation
. Elective irrevocable pre-tax contribu-
tions from compensation
. Elective irrevocable pre-tax contribu-
tions from accrued leave
Pre-tax
· Annual prospectively elected
contribution of accruing sick,
vacation, and/or other leave
· Voluntary after-tax contributions
Pre-tax except for voluntary after-tax
contributions
No FICA (OASDI or Medicare)
payable except that after-tax
voluntary employee contributions sub-
ject to FICA
· No limit on pre-tax contributions
(employer may impose limit)
. Mter-tax contributions limited to 25%
of total contributions
No contribution minimum at
participant or plan level
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Vesting on direct employer contributions Employer determines; can be immediate
Types of benefits allowed · Health
· De minimis
Eligible Medical Benefits
Default in Adoption Agreement:
· All IRC ~213 medical expenses
(except long-term care expenses) OR
Employer (or Collective Bargaining
Unit) selects any combination of the
following:
· Insurance premiums
I. Our-of-pocket expenses
· Medicare Part B premiums
· Medicare Supplemental
Insurance premiums
COBRA premiums
Dental insurance premiums
Vision insurance premiums
Long-term care premiums
Prescription drug insurance
I. Prescription drug expenses -'I'
I. Other medical expenses (IRC
, ~213) as defined by Employer or I
I Collective Bargaining Unit I
As outlined in plan - can be lin:Jkd to
age, retirement, separation from serv-
ice, or years of service
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Earliest benefit eligibility date
Tax treatment of health benefits
Payment schedule
As payment of health benefits is
required
Survivor benefits
Balance remains available for use by
surviving spouse and dependents (non-
taxable); if none or last of these dies,
named beneficiary may use for health
expenses (taxable)
De minimis account distribution level
Standard de minimis account
balance is $5,000 if participant
separates before eligibility for
benefits. Employer can establish a lower
level if desired.
Non-discrimination requirements
~
Apply to self-insured, non-collectively
bargained plans; results in "excess bene-
fits" being treated as compensation to
highly compensated participants
(continued on bgc,~)
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