HomeMy WebLinkAboutRES CC 2004 2266 2004 1215RESOLUTION NO. 2004 -2266
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF MOORPARK, CALIFORNIA, ESTABLISHING A CITY
OF MOORPARK SECTION 125 PREMIUM ONLY PLAN FOR
MEDICAL INSURANCE FOR CITY EMPLOYEES AND
MEMBERS OF THE CITY COUNCIL ELIGIBLE TO
RECEIVE MEDICAL INSURANCE BENEFITS
WHEREAS, Section 125 of the Internal Revenue Code allows for
the deduction of benefit premiums on a pre -tax basis; and
WHEREAS, a City of Moorpark Section 125 Premium Only Plan
(POP) is proposed to be established for medical insurance
consistent with the current Memorandum of Agreement by and
between the City of Moorpark and Service Employees International
Union AFL -CIO, CLC, Local 998, for competitive service employees;
Management employee benefits established by City Council
Resolution No. 2004 -2220; and Ordinance No. 307, which entitles
all sitting Councilmembers to the same health insurance benefits
afforded the City's competitive service employees as such
benefits exist on January 1, 2005, and as such may be amended
from time to time.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK
DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. The City Council hereby adopts the City of
Moorpark Section 125 POP, attached to this resolution and
incorporated herein by reference, effective January 1, 2005.
SECTION 2. The
this resolution and
filed in the book of
City
shall
o:
PASSED AND ADOPTEI
ATTEST:
Deborah S. Traffens dt
Clerk shall certify to the adoption of
cause a certified resolution to be
Attachment: City of Moorpark Section 125 Premium Only Plan
Resolution No. 2004 -2266
Page 2
CITY OF MOORPARK
PLAN DOCUMENT
SECTION 125
EIN: 95- 3860962
Resolution No. 2004 -2266
Page 3
CITY OF MOORPARK
SECTION 125 PLAN DOCUMENT
TABLE OF CONTENTS
Page
STATEMENT OF PURPOSE
4
ARTICLE
I. DEFINITIONS
1.1
Administrator ................................. ............................... 5
1.2
Anniversary Date ............................ ............................... 5
1.3
Benefits ........................................ ............................... 5
1.4
City ............................................... ............................... 5
1.5
Code ............................................ ............................... 5
1.6
Compensation ................................ ............................... 5
1.7
Council ......................................... ............................... 5
1.8
Dependent .................................... ............................... 5
1.9
Dependent Premiums ..................... ............................... 5
1.10
Domestic Partner ............................ ............................... 5
1.11
Effective Date ................................ ............................... 6
1.12
Election Periods ............................. ............................... 6
1.13
Eligible Employee ........................... ............................... 6
1.14
Employee ...................................... ............................... 6
1.15
Employer ...................................... ............................... 6
1.16
Flex Dollars ................................... ............................... 6
1.17
Highly Compensated Employee ........ ............................... 6
1.18
Initial Election Period ....................... ............................... 6
1.19
Insurance Company .......................... ............................... 6
1.20
Optional Benefit Coverages .............. ............................... 7
1.21
Participant ...................................... ............................... 7
1.22
Period of Coverage ......................... ............................... 7
1.23
Plan ............................................. ............................... 7
1.24
Plan Administrator ........................... ............................... 7
1.25
Plan Year ....................................... ............................... 7
1.26
Salary Reduction Contributions ........ ............................... 7
II. ELIGIBILITY AND PARTICIPATION
2.1
Eligibility .......................................... ............................... 8
2.2
Entry Date ........................................ ............................... 8
2.3
Employee Election ............................. ............................... 8
2.4
Election Periods ................................ ............................... 8
2.5
Termination of Participation ................. ............................... 9
2.6
Termination of Employment ................. ............................... 9
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Resolution No. 2004 -2266
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III. OPTIONAL BENEFIT COVERAGES
3.1
Coverage Options ............................. ...............................
10
3.2
Description of Optional Benefit Coverages ............................
10
3.3
Election of Optional Benefit Coverages in Lieu of Cash ............
10
IV. ELECTIONS
4.1
Election Procedure ............................. ...............................
11
4.2
Timing of Salary Reductions ................. ...............................
11
4.3
Initial Elections ................................... ...............................
12
4.4
Failure to Return Election Forms ............ ...............................
12
4.5
Irrevocable Nature of Salary Reduction Selected ......................
13
4.6
Status Change: Ability to Change Elections .............................
13
4.7
Consistency Rules ............................... ...............................
16
4.8
Changes by Administrator ..................... ...............................
16
4.9
Adjustment of Compensation Reductions .. ...............................
16
4.10
Maximum Elective Contributions .............. ...............................
16
4.11
Cessation of Required Contributions .......... ...............................
17
4.12
Coordination with FMLA ......................... ...............................
17
V. FLEX DOLLARS AND ADDITIONAL CASH BENEFITS
5.1 Flex Dollars .......................................... ............................... 18
5.2 Allocation of Flex Dollars ......................... ............................... 18
5.3 Waiver of Coverage Cash Option .............. ............................... 19
VI. NON - DISCRIMINATION
6.1 Intent .................................................. ............................... 20
6.2 Reduction of Benefits and /or Contributions . ............................... 20
6.3 Treatment of Contribution Reductions ........ ............................... 20
VII. ADMINISTRATION
7.1 Appointment of Administrator ................... ............................... 21
7.2 Duties of the Administrator ...................... ............................... 21
7.3 Reports and Records ............................. ............................... 22
7.4 Fiduciary Responsibilities ....................... ............................... 22
7.5 Indemnification of the Administrator ........... ............................... 22
7.6 Administrator Limitations ......................... ............................... 22
K
Resolution No. 2004 -2266
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VIII. AMENDMENT AND TERMINATION OF THE PLAN
8.1 Amendment .......................................... ............................... 23
8.2 Termination .......................................... ............................... 23
8.3 Rights of Participants .............................. ............................... 23
IX. MISCELLANEOUS
9.1
Indemnification ..................................... ...............................
24
9.2
Funding ............................................... ...............................
24
9.3
No Effect on Other Employee Considerations .............................
24
9.4
Titles and Headings ................................ ...............................
24
9.5
Gender and Number ............................... ...............................
25
9.6
Amendments in Writing ........................... ...............................
25
9.7
Separate Provisions ................................ ...............................
25
9.8
Plan Number ......................................... ...............................
25
9.9
City Information ....................................... ...............................
25
9.10
Service of Legal Process .......................... ...............................
25
X. SCHEDULE A — OPTIONAL BENEFIT COVERAGES ........................... 26
XI. SCHEDULE B — FLEX - DOLLAR ALLOWANCE SCHEDULE .................. 27
XII. EXECUTION PAGE ........................................... ............................... 28
3
Resolution No. 2004 -2266
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STATEMENT OF PURPOSE
This Plan Document amends, restates and continues the City of Moorpark 125 Premium
Only Plan (POP), originally effective January 1, 2005. The purpose of this Plan is to
provide Participants with a choice between cash and optional benefit coverages.
This Plan is intended to qualify as a "Cafeteria Plan" under Section 125 of the Internal
Revenue Code of 1986, as amended, and is to be interpreted in a manner consistent with
the requirements of Section 125.
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Resolution No. 2004 -2266
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ARTICLE I
DEFINITIONS
Whenever used here in, the following terms have the following meaning unless a
different meaning is clearly required by the context:
1.1 Administrator: The Administrator shall be the City of Moorpark or whom the City
appoints to act on its behalf.
1.2 Anniversary Date: Anniversary Date shall mean the annual recurrence of the first
day of the Plan Year.
1.3 Benefits: Benefits shall mean any benefit provided by the City of which a
Participant may choose.
1.4 Cam: City shall mean the City of Moorpark.
1.5 Code: Code shall mean the Internal Revenue Code of 1986, as amended, and
all regulations issued thereafter, and replacements from time to time.
1.6 Compensation: Compensation shall mean total remuneration received by a
Participant, including but not limited to wages, salary, overtime, bonuses, any
other payment which is not an advance, loan or expense reimbursement. Each
Participant's compensation shall be determined prior to taking into account
Participant's Salary Reduction Contributions under the Plan.
1.7 Council: Council shall mean the elected members of the City Council of the City
of Moorpark, as constituted from time to time.
1.8 Dependent: Dependent shall mean any individual as defined under Section 152
of the Code, as amended from time to time and domestic partners as defined in
Section 1.11 of this Agreement.
1.9 Dependent Premiums: Dependent Premiums shall mean the amount of premium
charged for dependent coverage under the City's group insurance plans.
1.10 Domestic Partner: Eligible Domestic Partner shall mean in accordance with
Chapter 588, same -sex partners and opposite sex partners over the age of 62
eligible for Social Security and share a common residence and who enroll with
the City group health plan within the Cal -PERS established guidelines. This
will include providing the City with a Declaration of Domestic Partnership from
the Secretary of State and signed State of Financial Liability. Domestic
Partners eligible for City registration but not with the Secretary of State and
who wish to receive a health benefit allowance must complete an affidavit of
City Domestic Partnership with the City of Moorpark.
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Resolution No. 2004 -2266
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Domestic Partners may be accepted outside of the open enrollment period only if it
is within the thirty (30) day domestic partner registration period with the City.
1.11 Effective Date: Effective Date shall mean the date that this Plan becomes
effective, which is January 1, 2005.
1.12 Election Periods: Election Periods shall mean the period of time as determined in
the Plan in which a Participant or employee may enter, change, or terminate
from the Plan. The Initial Election Period shall be the thirty (30) days after the
date of hire, to complete the necessary forms to elect the benefits desired within
the Plan. This Initial Election Period may be extended by the Administrator, at its
sole discretion upon written notice to employees. The annual election period
shall be the month immediately preceding the Anniversary Date of the Plan,
during which an eligible employee may make an election pursuant to Section 3.3.
1.13 Eligible Employee: Eligible Employee shall mean any regular full -time
employees, regular part-time employees, and city council members, who have
satisfied the eligibility requirements under the Plan and who participate in the
City's medical insurance program. Independent contractors and City employees
not participating in the City's medical insurance program shall not be deemed
eligible employees.
1.14 Employee: Employee shall mean a person employed by the Employer under
common law rules applicable in determining employer /employee relationships.
Independent contractors shall not be deemed employees.
1.15 Employer: Employer shall mean the City of Moorpark.
1.16 Flex Dollars: Flex Dollars shall mean benefit credits or benefit dollars provided to
a participant by his or her Employer, which may be applied towards the cost of
Optional Benefit Coverages.
1.17 Highly Compensated Employee: Highly Compensated Employee shall mean any
employee who is any of the following: (1) an officer; (2) receiving compensation
above the Section 414 limit for the applicable year; (3) receiving compensation
above the Section 414 limit for the applicable year and in the highest 20% of all
employees; (4) a spouse or dependent of a highly compensated employee; or (5)
meeting any other definition under Section 414(q) of the Code.
1.18 Initial Election Period: The Initial Election Period shall mean the thirty (30) days
after the date of hire. This Initial Election Period may be extended by the
Administrator, as its sole discretion, upon written notice to employees.
1.19 Insurance Company: Insurance Company, or insurance carrier, or insurer shall
mean any insurance company that underwrites and has a contract with the City
for a benefit under this Plan.
Resolution No. 2004 -2266
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1.20 Optional Benefit Coverages: Optional Benefit Coverages are coverages available
to the Participant under the Plans of the City.
1.21 Participant: Participant shall mean any eligible employee who elects to
participate in the plan.
1.22 Period of Coverage: Period of Coverage shall mean a Plan Year.
1.23 Plan: Plan shall mean the City's Section 125 Plan.
1.24 Plan Administrator: The Plan Administrator is the City of Moorpark who may,
according to local regulations delegate the administration and management of
the Plan as appointed by the City.
1.25 Plan Year: Plan Year means the period beginning January 1 and ending
December 31. All Plan Years shall begin on January 1 and end on December
31, unless otherwise changed by the City or the Administrator.
1.26 Salary Reduction Contributions: Salary reductions shall mean the amount that
each Participant has authorized the City to reduce his or her compensation in
order for it to be contributed to the Plan to provide the benefits selected by
Participants. The amount of Salary Reduction Contributions shall be designated
on the Salary Reduction Agreement approved by the Administrator.
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ARTICLE II
ELIGIBILITY AND PARTICIPATION
2.1 Eligibility:
All employees shall become eligible to be a Participant in the Plan upon satisfying
the following requirements of Sections (A) and (B) below:
(A) Employment Status:
Eligible employee shall mean any regular full -time employees, regular
part-time employees, and city council members, who have satisfied the
eligibility requirements under the Plan and who participate in the City's
medical insurance program. Independent contractors and City employees
not participating in the City's medical insurance program shall not be
deemed eligible employees.
(B) Service Conditions:
All eligible employees can participate in the Plan on the first day of the
month following date of hire.
2.2 Entry Date:
All eligible employees shall become Participants in this Plan on the first day of
the month following the date eligibility requirements are met.
2.3 Employee Election:
All employees who meet the eligibility requirements as set forth above may then
elect, during the appropriate Election Period, to become a Participant by
completing the "Salary Reduction Agreement ". This form designates whether the
employee desires to elect the benefits of the Plan.
2.4 Election Periods:
(A) Initial Election Period:
All employees who meet the eligibility requirements as listed above, have a
thirty (30) day election period to select plans offered by the City after adoption
of the Plan; and a thirty (30) day election period after their date of hire to
make an election under one of the Plans offered by the City. Employees
must complete the necessary forms to elect the benefits that they desire
within the Plan. This Initial Election Period may be extended by the
Administrator, at its sole discretion, upon written notice to employees.
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(B) Annual Election Periods:
After the Initial Election Period, Participants may elect to change, modify,
decrease, or increase their benefits during only one Election Period, which
shall be the month immediately preceding the Anniversary Date of the
Plan. Participants must complete a new Salary Reduction Agreement as
described in Section 2.3 above in order to have changes become
effective.
2.5 Termination of Participation:
A Participant shall remain a Participant in the Plan until the occurrence of one or
more of the following:
(A) Participant ceases to be eligible to participate in Plan;
(B) Participant's employment is terminated;
(C) Participant's death;
(D) The termination of this Plan;
(E) Participant elects not to participate under section 4.4 (C).
2.6 Termination of Employment:
If a Participant's employment is terminated, then all contributions to the Plan shall
cease upon the termination date, the Participant shall no longer be considered a
Participant effective on the date of termination.
However, a Participant may still be eligible for certain benefits in accordance with
the terms of the City's medical plan for which premiums have been paid on
Participant's behalf. The continuation of any benefits is governed solely by the
terms and provisions of the City's group insurance plan and applicable law.
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ARTICLE III
OPTIONAL BENEFIT COVERAGES
3.1 Coverage Options:
Each Participant may choose under this Plan to receive his or her regular
compensation in cash, plus any Flex Dollars or any additional cash benefits to
the extent available under Article V, or to have a portion of it applied by the City
toward the cost of the Optional Benefit Coverages available to the Participant.
Notwithstanding anything herein to the contrary, Optional Benefit Coverages
shall be limited to coverages and benefits available under the plans identified in
Schedule A.
3.2 Description of Optional Benefit Coverages:
While the election of one or more of the Optional Benefit Coverages may be
made under this Plan, the coverages and benefits thereunder will be provided
not by this Plan but by the plans identified in Schedule A, the requirements for
participating in such plans, and the other terms and conditions of coverage and
benefits under such plans are set forth from time to time in the plans identified in
Schedule A, and in any group insurance contracts and prepaid health plan
contracts that constitute (or are incorporated by reference in) certain of those
plans. The benefit descriptions in such plans, as in effect from time to time, are
hereby incorporated by reference into this Plan.
3.3 Election of Optional Benefit Coverages in Lieu of Cash:
A Participant may elect under this Plan to receive one or more of the Optional
Benefit Coverages described in Section 3.2, to the extent available to the
Participant under the applicable plans identified on Schedule A, in accordance
with the procedures described in Sections 4.1, 4.2 and 4.3.
(A) If a Participant elects coverage for a Period of Coverage under a plan
identified on Schedule A, and if the Participant is required under such plan
to pay a share of the cost of such coverage, such share shall be paid by
the Participant. Payment shall first be from the Participant's Flex Dollars,
as provided in Section 5.2, and second by means of a reduction in the
Participant's regular compensation for the Period of Coverage for the
balance of the cost of each coverage elected.
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Resolution No. 2004 -2266
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ARTICLE IV
ELECTIONS
4.1 Election Procedure:
Prior to the commencement of each Period of Coverage, the Administrator shall
not be required to notify current Participants of the right to change elections for
the following year. The Administrator will provide a salary reduction form to each
eligible individual who is expected to become a Participant at the beginning of
the applicable Period of Coverage. The election forms shall be effective as the
first day of the Period of Coverage. Each Participant who desires to elect an
Optional Benefit Coverage available for the Period of Coverage shall so specify
on the appropriate election form and shall agree to a reduction in his or her
compensation.
(A) The amount of the reduction in the Participant's compensation for the
Period of Coverage for coverage under a plan identified as an Optional
Benefit Coverage on Schedule A shall equal the Participant's share of the
cost of such coverage, reduced by the amounts paid from the Participant's
Flex Dollars under Section 5.2
(B) The amount of contributions shall change according to the schedule of
premiums for the City's group benefits and the benefit contribution amount
approved by the City Council. A Participant's Salary Reduction Agreement
could automatically increase or decrease, depending upon the change in
premiums of that particular benefit offered by the City, or increase or
decrease depending upon the amount of the Participant's required
contribution for benefits.
Each election form must be completed and returned to the Administrator on or
before such date as the Administrator shall specify, which date shall be no later
than the beginning of the first pay period for which the participant's
compensation reduction agreement will apply.
4.2 Salary Reduction Agreement:
Each Participant shall complete a Salary Reduction Agreement at the Initial
Election Period. In all following years, if a Participant desires to change the
amount of the election, enroll in the Plan, or terminate from the Plan, a new
Salary Reduction Agreement must be completed within the month immediately
preceding the Anniversary date of the Plan. This period of time shall be known
as the Annual Election Period.
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Resolution No. 2004 -2266
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4.3 Initial Elections:
(A) An eligible employee, as defined in Section 2.1 of this Plan, who is not a
Participant prior to the effective date of the Plan, has the month
immediately preceding the effective date of this Plan to elect their desired
benefits for the Current Plan Year. Such election is made by completing
the Salary Reduction Agreement and other necessary forms as deemed
by the Administrator. The Administrator may choose to extend this period,
at its sole discretion, in order to assist the City's employees in determining
whether to participate in this Plan.
(B) The initial election shall adhere to the Initial Plan Year.
4.4 Failure to Return Election Forms:
(A) A new Participant's failure to return a completed election form under
Section 4.1, 4.2, or 4.3 to the Administrator on or before the specified due
date for the Period of Coverage in which he or she becomes a Participant
with respect to the benefits available for that Period of Coverage shall be
deemed to have elected to participate in the Premium Only Plan and an
agreement to a reduction in the Participant's compensation for the
subsequent Period of Coverage equal to the Participant share of each
such coverage for the Period of Coverage, reduced by the amounts paid
from the Participant's Flex Dollars (if any) under Section 5.2.
(B) An existing Participant's failure to return a completed election form to the
Administrator relating to coverage under a plan identified as an Optional
Benefit Coverage on Schedule A on or before the specified due date for
any subsequent Period of Coverage shall be deemed to constitute (1) a
re- election of the same coverage or coverages, if any, under such plans
as were in effect just prior to the end of the preceding Period of Coverage
(to the extent such coverage remains available as an Optional Benefit
Coverage under the Plan), and (2) an agreement to a reduction in the
Participant's compensation for the subsequent Period of Coverage equal
to the Participant share of each such coverage for the Period of
Coverage, reduced by the amounts paid from the Participant's Flex
Dollars (if any) under Section 5.2.
(C) Participants may voluntarily terminate their participation in the Plan, but
only during an Annual Election Period. If a Participant elects not to
participate for the Plan Year applicable for the Annual Election Period,
then that Participant cannot elect to reenter the Plan until the next Annual
Election Period, unless a Status Change as defined in Section 4.6 occurs
or there is a mid -plan year change in the benefits offered through this
Plan.
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Resolution No. 2004 -2266
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4.5 Irrevocable Nature of Salary Reduction Selected:
(A) A Participant's election of the amount of the Salary Reduction
Contributions shall be irrevocable during the Plan Year.
(B) Participants can change, modify, decrease or increase their Salary
Reduction Contributions, only if a Status Change as defined in Section 4.6
has occurred, a change has occurred in the City's group benefits offered
to its employees, or a change has occurred in the amount of contribution
for the plan's benefits as required by the City during the Plan Year. If
such a change has occurred, then the Participant must submit to the
Administrator a completed new Salary Reduction Agreement in order to
have the change be effective at the beginning of the following payroll
period.
(C) The Employer and /or the Administrator cannot change any amount of the
Salary Reduction Contributions selected by each Participant during the
Plan Year, unless a termination has occurred as defined under Section
2.5 or 2.6 of this Plan, or a Status Change has occurred, or a change has
occurred in the City's group benefits offered to its employees, or a change
has occurred in the amount of contribution for the plan's benefits as
required by the City.
4.6 Status Change: Ability to Change Elections:
(A) A Participant's election made under the Plan (including an election made
through inaction under Section 4.4), shall be irrevocable by the
Participant during the Period of Coverage except as otherwise provided in
(1) through (6) below. A Participant may revoke an election in writing for
the balance of the Period of Coverage and, if desired, file a new election
in writing if, under the facts and circumstances, a Status Change occurs,
and the requested revocation and new election satisfies the applicable
consistency requirements in Section 4.7 hereof.
Application for such change must be made within 30 days of the actual event.
For this purpose, a Status Change includes the following events:
1. Legal Marital Status: Events that change a Participant's legal
marital status, including marriage, death of spouse, divorce, legal
separation, or annulment.
2. Number of Dependents: Events that change the Participants
number of Dependents (as defined in Code Section 152), including
birth, adoption, placement for adoption (as defined in Regulations
under Code Section 9801), or death of a dependent.
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Resolution No. 2004 -2266
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3. Employment Status: Any of the following events that change the
employment status of the employee, employee's spouse, or the
employee's dependent: a termination or commencement of
employment; a strike or lockout; a commencement of or return from
an unpaid leave of absence; and a change in worksite. In addition,
if the eligibility conditions of the cafeteria plan or other employee
benefit plan of the employer of the employee, spouse or dependent
depend on the employment status of that individual and there is a
change in that individual's employment status with the
consequence that the individual becomes (or ceases to be) eligible
under the plan, then that change constitutes a change of
employment under this paragraph.
4. Requirements for Unmarried Dependents: An event that causes a
Participant's dependent to satisfy or cease to satisfy the
requirements for coverage due to attainment of age, student status,
or any similar circumstance as provided in any accident or health
plan identified in Schedule A under which the Participant received
coverage.
5. Residence or Worksite: A change in the place of residence or work
of the Participant or the Participant's spouse or dependent.
6. Enrollment in Health Coverage: A significant change in the health
coverage of the Participant or the Participant's spouse attributable
to the spouse's employment, and such other events that the
Administrator determines will permit the revocation of an election
(and, if applicable, the filing of a new election) during a Period of
Coverage under regulations and rulings of the Internal Revenue
Service.
(B) In order to revoke an election or file a new election under this subsection,
a Participant must submit a written application within 30 days of the Status
Change.
(C) In the case of coverage under a plan identified in Schedule A, a
Participant may revoke an election in writing for the balance of the Period
of Coverage and file a new election in writing that corresponds with the
special enrollment rights provided in Code Section 9801(f), whether or not
the change in election is permitted under Section 4.6, above.
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Resolution No. 2004 -2266
Page 17
(D) In the case of a judgment, decree or order resulting from a divorce, legal
separation, annulment, or change in legal custody (including a Qualified
Medical Child Support Order) that requires accident or health coverage for
a Participant's child, a Participant may change his or her election (1) to
provide coverage for the child under a health plan identified in Schedule A
if the order so requires, or (2) to cancel coverage under a health plan
identified in Schedule A for the Participant's child if such order requires
the Participant's former spouse to provide coverage.
(E) In the case of coverage under a health plan identified in Schedule A, a
Participant may revoke an election in writing for the balance of the Period
of Coverage and file a new election in writing to effectively cancel such
health plan coverage for the Participant and /or the Participant's spouse or
dependent to the extent that such individual become entitled to coverage
under Part A or Part B of Title XVIII of the Social Security Action
(Medicare) or Title XIX of the Social Security Act (Medicaid), other than
coverage consisting solely of benefits under Section 1928 of the Social
Security Act (the program for distribution of pediatric vaccines). In
addition, if an employee, spouse or dependent who has been entitled to
such coverage under Medicare, Medicaid, or a state program under the
State Children Health Insurance Program ( SCHIP) loses eligibility for such
coverage, the cafeteria plan may permit the employee to make a
prospective election to commence or increase coverage of that employee,
spouse, or dependent under the accident or health plan. A Participant
may not revoke his election if he becomes eligible for SCHIP coverage
during the year.
(F) In the case of coverage under a health plan identified in Schedule A which
is provided by an independent third -party provider, if:
1. The Participant's share of the cost of such coverage significantly
increases or decreases as a result of a significant cost increase or
decrease by the independent third -party provider, or
2. Such coverage ceases or is significantly curtailed, the Administrator
may permit all Participants electing such coverage for the Period of
Coverage, to revoke their elections for the balance of the Period of
Coverage, and to complete a new Salary Reduction Agreement,
provided that similar coverage is elected under a health plan
identified in Schedule A for the balance of the Period of Coverage,
in the event that similar coverage is not available to the Participant,
the Participant may revoke his election for the remainder of the
Plan Year.
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Resolution No. 2004 -2266
Page 18
(G) Any revocation and new election under this Section 4.6 shall be effective
at such time as the Administrator shall prescribe, but not earlier than the
first pay period beginning after the revocation and new election, unless
otherwise required by law.
4.7 Consistency Rules:
A Participant's requested written revocation and new election will be consistent
with a Status Change described in Section 4.6 if, and only if, (1) the Status
Change results in the Participant, or the Participant's spouse or dependent,
gaining or losing eligibility for accident or health coverage under either the Plan
or a plan of the spouse's or dependent's employer, and (2) the election change
corresponds with that gain or loss of coverage.
Notwithstanding anything in this Section 4.7 to the contrary, if the Participant, or
the Participant's spouse or dependent, becomes eligible for continuation
coverage under a health plan identified in Schedule A as provided in Code
Section 4980B or any similar state law, the Participant may elect to reduce his or
her regular compensation under the Plan in order to pay for the continuation
coverage.
4.8 Changes by Administrator:
If the Administrator determines, before or during any year, that the Plan may fail
to satisfy for such year any nondiscrimination or other requirement imposed by
the Code or any limitation on benefits provided to the Highly Compensated
Employees, the Administrator shall take such action as the Administrator deems
appropriate, under rules uniformly applicable to similarly situated Participants, to
assure compliance with such requirement or limitation. Such action may include,
without limitation, a modification of elections by Highly Compensated Employees
(as defined by the Code for purposes of the nondiscrimination requirement in
question) without the consent of such Employees.
4.9 Adjustment of Compensation Reductions:
If the cost of Optional Benefit Coverages provided by an independent third -party
provider under a medical plan identified in Schedule A increases or decreases
during a Period of Coverage, a corresponding change shall be made in the
compensation reductions of all Participants receiving such coverage in an
amount to be determined by the Administrator.
4.10 Maximum Elective Contributions:
The maximum amount of elective contributions under the Plan for any Participant
shall be the total cost to the Participant for the Period of Coverage of the most
expensive Optional Benefit Coverages that any Participant could elect.
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Resolution No. 2004 -2266
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4.11 Cessation of Required Contributions:
Nothing in this Plan shall prevent the cessation of coverage or benefits under
any plan identified on Schedule A, in accordance with the terms of such plan, on
account of a Participant's failure to pay the Participant's share of the cost of such
coverage or benefits, through compensation reduction or otherwise.
4.12 Coordination with FMLA:
Notwithstanding any other provision of this Plan, the Administrator may (a)
permit a Participant to revoke (and subsequently reinstate) his or her election of
one or more Optional Benefit Coverages under the Plan, and (b) adjust a
Participant's compensation reduction as a result of a revocation or reinstatement
to the extent the Administrator deems necessary or appropriate to assure the
Plan's compliance with the provisions of the Family and Medical Leave Act of
1993 and any amendments and regulations pertaining thereto.
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Resolution No. 2004 -2266
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ARTICLE V
FLEX DOLLARS AND ADDITIONAL CASH BENEFITS
5.1 Flex Dollars:
A Participant will be eligible to receive Flex Dollars if, and to the extent that, the
City has elected to provide Flex Dollars under the Plan consistent with any
applicable Memorandum of Agreement for Competitive Service employees, City
Council adopted Management Benefits Resolution, and /or City ordinance
adopting City Council compensation. Prior to the commencement of each Period
of Coverage the City shall determine the amount of Flex Dollars available to
each such Participant in accordance with the rules and procedures adopted by
the City and by the Plan Administrator, which shall not discriminate in favor of
Highly Compensated Employees. The Administrator shall notify such Participant
in writing of the amount of Flex Dollars available to him or her for the Period of
Coverage (or for the balance of the Period of Coverage).
5.2 Allocation of Flex Dollars:
Any Flex Dollars available to a Participant under this Article V shall be applied
proportionately each pay period toward the cost of the Optional Benefit
Coverages elected by the Participant. If for any Period of Coverage the cost of
the Optional Benefit Coverages elected by the participant exceeds the
Participant's Flex Dollars, then the Participant's compensation shall be reduced
proportionately each pay period in the amount of the excess, and an amount
equal to the compensation reduction shall be contributed by the Employer to
cover the remaining cost of the optional Benefit Coverages elected by the
Participant. However, if for any Period of Coverage the cost of the Optional
Benefit Coverages elected by the Participant is less than the Participant's Flex
Dollars, then the Participant shall receive the value of any Flex Dollars not
allocated to Optional Benefit Coverage and receive the Flex Dollars as taxable
income not to exceed the amount established by any applicable Memorandum of
Agreement for Competitive Service employees, City Council adopted
Management Benefits Resolution, and /or City ordinance adopting City Council
compensation.
Resolution No. 2004 -2266
Page 21
5.3 Waiver of Coverage Cash Option:
A Participant who has elected to waive coverage under a medical Optional
Benefit Coverage identified in Schedule A may elect the Waiver of Coverage
Cash Option for the benefit(s) waived. Under this Option the Employer will
increase such Participant's cash compensation as a taxable refund of
contributions, for each pay period during which the Participant does not have in
effect any medical Optional Benefit Coverage. Determination of the waiver
amount available to Participants, and the manner in which it is paid, shall be
made in accordance with the rules and procedure adopted by the Employer and
by the Administrator, which shall not discriminate in favor of Highly Compensated
Employees. The Administrator shall notify such Participant in writing of the
waiver amount available to him or her for the Period of Coverage (or for the
balance of the Period of Coverage) under this Option. An eligible Participant may
elect the Waiver of Coverage Cash Option in writing in such form and manner as
the Administrator shall prescribe, at the same time or times that the Participant is
permitted to elect Optional Benefit Coverages under Article IV. Such election
shall be irrevocable during each Period of Coverage to the same extent as an
election of Optional Benefit Coverages identified in Schedule A.
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Resolution No. 2004 -2266
Page 22
ARTICLE VI
NON - DISCRIMINATION
6.1 Intent:
It is the intent of this Plan not to discriminate between any classes of employees
or create such an action in part or whole of this Plan document that is in violation
of Code Section 125 and Treasury regulations. The Administrator shall avoid all
discretionary acts, which could be deemed to be discriminatory under any
applicable Code section or law.
6.2 Reduction of Benefits and /or Contributions:
The Administrator may reduce, modify, change or reject the benefits or amounts
of contribution of any Participant of the Plan if the Administrator deems it
necessary to make certain this Plan does not discriminate in favor of Highly
Compensated Employees as defined in Code Sections 125 and any other
applicable Code section or law.
6.3 Treatment of Contribution Reductions:
Contributions in excess of benefits due to the Administrator's actions to avoid
violations of discrimination, shall be returned to the Participant in the form of a
taxable refund of contributions.
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Resolution No. 2004 -2266
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ARTICLE VII
ADMINISTRATION
7.1 Appointment of Administrator:
The Council shall designate the Administrator of the Plan. Such Designation of
the Administrator will be for the full term of the Plan, unless otherwise noted by
the Council. The name, address, and phone numbers of the Administrator of the
Plan will be:
City of Moorpark
799 Moorpark Avenue
Moorpark, California 93021
Phone #: (805) 517 -6213 or 517 -6238
The Administrator shall be responsible for the complete management of the
Plan, and to undertake any action necessary to preserve the benefits of the
Participants of the Plan.
7.2 Duties of the Administrator:
The Administrator shall have all necessary power to carry out the full
administration and management of the Plan. The Administrator's powers shall
include, but are not limited to:
(A) To interpret the provisions of the Plan;
(B) To enforce all provisions of the Plan;
(C) To make changes in the Plan when necessary;
(D) To decide all questions of eligibility;
(E) To decide all questions of benefits;
(F) To decide the proper management of benefit claims;
(G) To obtain from every employee the necessary forms and documents that
allow participation in the Plan;
(H) To obtain from every Participant the necessary forms and documents that
allow either continued participation or termination in the Plan;
(1) To contract with any and all insurance companies or other suppliers to
provide benefits under the Plan;
(J) To notify each Participant in writing of any amendment of the Plan, of any
proposed amendment of the Plan, of the termination of any benefit of the
Plan, and of the termination of the Plan;
(K) To provide guidance for employees and Participants as to questions of
participation, benefits, or personal objectives in connection with the Plan;
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Resolution No. 2004 -2266
Page 24
(L) To appoint necessary agents, consultants and professionals to assist in
administering the Plan and completing necessary documentation and
reportings;
(M) To avoid discrimination under the Plan;
(N) To pay for any administrative costs of the Plan;
(0) To do any other acts as deemed necessary to administer and manage the
plan for the benefit of its Participants.
7.3 Reports and Records:
The Administrator shall keep complete books, reports and records of all activities
under the Plan. The records of the Plan shall be open for inspection during
normal business hours, to the City and to each Participant, of only that
Participant's individual participation records. The Administrator shall prepare
and submit to the City an annual report containing material, which the
Administrator deems necessary under Sections 125 and 129 or any other section
of the Code.
7.4 Fiduciary Responsibilities:
The Administrator shall conduct its duties of the Plan as a fiduciary for the
Participants and their beneficiaries. The Administrator must exercise proper
judgement and diligence in carrying out any action and in any capacity as Plan
Administrator. The Administrator shall act according to the Plan and the
administrative duties contained herein, and such actions must be for the benefit
of the Participants or potential Participants of the Plan.
7.5 Indemnification of the Administrator:
The City agrees to indemnify the Administrator, and any employee of the City
acting as the Administrator, an assistant to the Administrator, or agent of the
Administrator, to the fullest extent permitted by law against any and all liabilities,
claims, expenses, and damages stemming from the actions or omissions of any
such person in connection with administering the Plan for the benefit of its
Participants, as long as such actions and omissions were at the time in good
faith and carried forth with proper diligence and care.
7.6 Administrator Limitations:
The Administrator is not responsible for the actual administration of group
insurance plans supplied by insurance carriers, as such plans shall be governed
by the terms of each such plan.
22
Resolution No. 2004 -2266
Page 25
ARTICLE VIII
AMENDMENT AND TERMINATION OF THE PLAN
8.1 Amendment:
The Administrator can amend the Plan by providing written notice to all
Participants and potential Participants of the change or pending change. Such
amendment of the Plan shall not affect the rights of a Participant pertaining to all
clauses contained in this Plan, or change any benefit of the Participant if such
benefit has not been subsequently changed by a carrier or the City, or change
any right under the City's group insurance plan.
8.2 Termination:
The City expects that this Plan will be maintained indefinitely, however,
continuance is not guaranteed. The City reserves the right to terminate the Plan
at any time with advance notice to Participants. Upon termination, no further
contributions will be made.
8.3 Rights of Participants:
If the Plan is terminated, the rights of Participants to receive benefits and
reimbursements under the City's group insurance plan for conditions prior to
termination, are not affected in any manner.
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Resolution No. 2004 -2266
Page 26
ARTICLE IX
MISCELLANEOUS
9.1 Indemnification:
To the extent permitted by law, the City shall indemnify and hold harmless the
Administrator, the Plan Participants, its employees, or any other person who
performs duties of the Plan against all claims, losses, damages, expenses, and
liabilities resulting from their normal course of action unless it is determined that
gross negligence or willful misconduct occurred.
The Participants shall hold harmless the City, the Administrator, its employees or
any other person who performs duties of the Plan as directed by the City against
all claims, losses, damages, expenses, and liabilities arising out of any tax
related matter, as the City specifically makes no claim as to the tax treatment of
the Plan, the qualification of the Plan as a taxable or tax - exempt entity, tax
deductions of contributions, or any other assurance of future tax treatments as
long as no gross negligence or willful misconduct has occurred.
The City shall not be directly responsible for any action taken by any insurance
carrier who offers benefits to the City, nor shall it be responsible to make
payments to any Participant if the insurance carrier fails to do so.
9.2 Funding:
All contributions to the Plan do not have to be placed in trust accounts or
specified for certain benefits, nor is it required that the City or Administrator
maintain separate accounts for any or all Participants with regard to their
contributions. The assets of the Plan will be considered as general assets of the
City to be used to timely pay for the benefits selected.
9.3 No Effect on Other Employee Considerations:
Participation in this Plan by any employee of the City should not be construed as
anything but participation in one particular benefit offered by the City.
Participation in the Plan does not bind the City to any contractual obligation or
employment obligation with the employee, other than to the terms of the Plan
documents.
9.4 Titles and Headings:
The title and headings within this document are for simplification or reference
only, and are not intended to be complete in any definition or meaning of the
actual plan. The entire text of this document shall govern rather than any specific
title or heading.
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Resolution No. 2004 -2266
Page 27
9.5 Gender and Number:
Wherever any words are used in the masculine, feminine or neuter gender, they
shall be interpreted to be applicable to all cases where they would apply.
Wherever used in this document, the singular shall mean the plural and the
plural shall mean the singular except where context requires otherwise.
9.6 Amendments in Writing:
Any and all amendments to this Plan, qualifications of the Plan, and
interpretations of the Plan, need to be in writing in order to be valid.
9.7 Separate Provisions:
If any provision of this Plan is deemed invalid or unenforceable, then only its
validity or enforceability shall be questioned or changed, and it will not affect in
any manner any other provision of the Plan or the Plan itself.
9.8 Plan Number:
The Plan Number shall be 501.
9.9 City Information:
The name, address, phone numbers, and employer identification number of the City
are:
City of Moorpark
799 Moorpark Avenue
Moorpark, California 93021
Phone #: (805) 517 -6213 or 517 -6238
EI N: 95- 3860962
9.10 Service of Legal Process:
The name, address, and phone number of the agent for service of legal process
are:
City Clerk
City of Moorpark
799 Moorpark Avenue
Moorpark, California 93021
Phone #: (805) 517 -6213
25
Resolution No. 2004 -2266
Page 28
ARTICLE X
SCHEDULE A - OPTIONAL BENEFIT COVERAGES
Optional Benefit Coverages shall consist of the coverages(s) available to a Participant
under the following Plan (s) maintained by the City:
Health Insurance Plan(s) through the California Public Employees' Retirement
System
W
Resolution No. 2004 -2266
Page 29
ARTICLE XI
SCHEDULE B - FLEX - DOLLAR ALLOWANCE SCHEDULE
Flex Dollar Allowance Effective January 1, 2005:
With Medical Coverage I Total Monthly Employee Benefit
All Competitive Service
Employees
$908.00*
Department Heads
Maximum CALPERS (PERSCARE)
family rate **
Non - Department Head
$908.00 **
Management Employees
City Council Members
$908.00 * **
* As determined by City Council approved Memorandum of Agreement for
Competitive Service Employees.
** As determined by City Council approved Management Benefits Resolution.
* ** As determined by City Council ordinance.
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Resolution No. 2004 -2266
Page 30
ARTICLE XII
EXECUTION PAGE
IN WITNESS WHEREOF, the City has caused this Plan to be signed by the City
Manager as of the day of ,
CITY OF MOORPARK
JIM
Steven Kueny, City Manager
0,x:3
Resolution No. 2004 -2266
Page 31
STATE OF CALIFORNIA )
COUNTY OF VENTURA ) ss.
CITY OF MOORPARK )
I, Deborah S. Traffenstedt, City Clerk of the City of
Moorpark, California, do hereby certify under penalty of perjury
that the foregoing Resolution No. 2004 -2266 adopted by the City
Council of the City of Moorpark at a special meeting held on the
15th day of December, 2004, and that the same was adopted by the
following vote:
AYES: Councilmembers Harper, Mikos, Millhouse, Parvin
and Mayor Hunter
NOES: None
ABSENT: None
ABSTAIN: None
WITNESS my hand and the official seal of said City this 22nd
day of December, 2004.
Deborah S. Traffenst , City Clerk
(seal)