Sec. 102-152. Termination and severability.
(a) Termination of the plan and trust. Upon a complete or partial termination of the plan, the rights of each affected participant to benefits accrued under the plan to the date of such discontinuance, to the extent then funded, shall be nonforfeitable. Upon a partial or complete termination of the plan or a permanent discontinuance of contributions to the plan, the proportionate interests of each affected participant and beneficiary shall be determined by the actuary. The assets of the terminated portion of the trust shall be liquidated and payment of expenses of administration, termination and liquidation shall be made therefrom. Payment or provision for the payment of the actuarial equivalent value of benefits accrued prior to the date of termination shall be made in the following order of precedence, to the participants and their beneficiaries from the liquidated portion of the trust on the following basis:
(1) An amount equal to the contribution accumulation and vested city contributions which would have been payable to the participant, retired participant or beneficiary had death occurred on the day before the termination of the plan.
(2) An amount of the remaining affected assets equal to the prorated portion that the actuarial reserve for the participant's accrued benefits minus the amount in subsection (a)(1) of this section credited to the participant bears to the total of such actuarial reserves minus the total amounts in subsection (a)(1) of this section.
(b) Manner of distribution. Any distribution after termination of the plan may be made at any time in whole or in part to the extent that no discrimination in value results, in cash, in securities, or other assets in kind at fair market value, in the form of a pension or a continued pension, in nontransferable annuity contracts, or in installments, as determined by the board in its discretion. In making such distribution, any and all determinations, divisions, appraisals, apportionments and allotments shall be made by the board acting under the information supplied by the actuary and shall be final and conclusive and not subject to question by any person.
(c) Limitations. The order of priorities set forth in this section if the plan is terminated shall be subject to:
(1) The limitations provided by section 102-149; and
(2) Such distributions not being determined by the Secretary of Treasury to produce discrimination prohibited by the code.
If either the limitations under section 102-149 become effective or the Secretary of the Treasury rules that the distributions are otherwise discriminatory, adjustments shall be made in the priorities and amounts of distributions as may be necessary to satisfy the requirements of section 102-149 or of the Secretary of the Treasury.
(d) Amounts returnable to the City. In no event shall the city receive any amounts from the trust except such amounts, if any, as follows:
(1) Upon termination of the plan and subject to subsection (d)(2) of this section, the city shall receive such amounts, if any, as may remain after the satisfaction of all liabilities of the plan to its participants and beneficiaries, and arising out of any variations between actual requirements and expected actuarial requirements.
(2) Before any distribution from the trust to the city pursuant to subsection (d)(1) of this section, if any assets of the plan attributable to employee contributions remain after satisfaction of all liabilities described in subsection (a) of this section, such remaining assets shall be equitably distributed to the participants who made such contributions or their beneficiaries. For purposes of this subsection, the portion of the remaining assets which are attributable to employee contributions shall be an amount equal to the product derived by multiplying:
a. The market value of the total remaining assets, by
b. A fraction:
1. The numerator of which is the present value of all portions of the accrued benefits with respect to participants which are derived from participants' mandatory contributions, and
2. The denominator of which is the present value of all accrued benefits payable from the terminated plan according to subsection (a) of this section.
For purposes of this subsection, each person who is, as of the termination date, a participant under the plan shall be treated as a participant with respect to termination, if all or part of the nonforfeitable benefit with respect to such person is attributable to participants' mandatory contributions.
(3) If a contribution is made by the City by a mistake of fact, such contribution may be returned to the city within one year after payment thereof.
(4) If a determination letter is issued by the district director of Internal Revenue to the effect that the plan and trust set forth in this article or as amended prior to the receipt of such letter do not meet the requirements of sections 401(a) and 501(a) of the code, the city shall be entitled to its option to withdraw, within one year of the receipt of such letter, all contributions made on and after the effective date, in which event the plan shall cease and terminate, and all rights of the participants shall be those as if the prior plan had been terminated as of such effective date.
(e) Severability. If any section, subsection, paragraph, sentence, clause or phrase of this chapter is, for any reason, held or decided to be unconstitutional, such decision shall not affect the validity of the remaining portions of this chapter. The city council declares that it would have passed this chapter and each section, subsection, paragraph, sentence, clause and phrase thereof irrespective of the fact that any one or more sections, subsections, paragraphs, sentences, clauses or phrases might be declared unconstitutional. (Code 1979, § 15-58; Ord. No. 97-77, § 10, 1-5-1998; Ord. No. 96-38, § 9, 10-7-1996)