HomeMy WebLinkAboutResolution No. 5985 RESOLUTION NO. 5 985
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DOWNEY
ESTABLISHING A PRE -TAX PAYROLL DEDUCTION PLAN FOR SERVICE CREDIT
PURCHASES (CONTRIBUTION CODE 14).
WHEREAS, the Board of Administration of the California Public Employees' retirement
System (Ca1PERS) at the April 1996 meeting approved a pre -tax payroll deduction plan for
service credit purchases under Internal Revenue Code IRC section 414(h)(2); and
WHEREAS, the City of Downey has the authority to implement the provisions of IRC
section 414(h)(2) and has determined that even though implementation is not required by law,
the tax benefit offered by this section should be provided to those employees who are members
of CaIPERS; and
WHEREAS, the City of Downey elects to participate in the pre -tax payroll deduction
plan for all employees in the following Ca1PERS coverage groups:
70001 Miscellaneous
74001 Fire
75001 Police
NOW THEREFORE, BE IT RESOLVED:
I. That the City of Downey will implement the provisions of IRC section(h)(2) by making
employee contributions for service credit purchases pursuant to the California State
Government Code on behalf of its employees who are members of CaIPERS and who
have made a binding irrevocable election to participate in the pre -tax payroll deduction
plan. "Employee contributions" shall mean those contributions reported to CaIPERS
which are deducted from the salary of employees and are credited to individual ee em to
p y
accounts for service credit purchases thereby resulting in tax deferral of employee
contributions.
II. That the contributions made by the City of Downey to CaIPERS, although designated as
employee contributions, are being paid by the City of Downey in lieu of contributions by
the employees who are members of CaIPERS.
III. That the employees shall not have the option of choosing to receive the contributed
amounts directly instead of having them paid by the City of Downey to CaIPERS.
IV. That the City of Downey shall pay to CaIPERS the contributions designated as employee
contributions from the same source of funds as used in paying salary, thereby resulting in
tax deferral of employee contributions.
Resolution [lo. 5985
V. That the effective date for commencement of the pre -tax payroll deduction plan cannot be
any earlier than July 1, 1996, or the date the completed resolution is received and
approved in Ca1PERS, whichever is later.
VI. That the governing body of the City of Downey shall participate in and adhere to
requirements and restrictions of the pre -tax payroll deduction plan by reporting pre -tax
payroll deductions when authorized by Ca1PERS for those employees of the above stated
Coverage Groups who have elected to participate in this plan.
APPROVED AND ADOPTED THIS 27th day of August , 1996
qw0 A J I LAWRE E , Mayor
ATTEST:
• - ,
./ 41 Off 4, AA
City. -l;rk
I HEREBY CERTIFY that the foregoing Resolution was approved and
adopted at the regular meeting of the City Council on the 27th day of
August ,1996, by the following vote, to wit:
AYES: 4 Council Members: Brazel ton , Boggs , McCaughan , Lawrence
NOES: 0 Council Members: None
Absent: 1 Council Members: Riley
.:. i
City Clerk
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