HomeMy WebLinkAboutItem 7 LakeElmo_Appendix_B_DBPlan_V7.0_13_02_10
These model documents are drafted to conform to Minnesota state laws relating to relief association pension plans
for volunteer firefighters. The model documents are not drafted to meet the requirements of tax-qualified retirement
plans under the Internal Revenue Code, and it is doubtful that the model documents can meet those requirements.
Minnesota Firefighter Pension Consultants, LLC (MNFPC, LLC) makes no representation regarding the
status of the plans under federal or state tax laws. MNFPC, LLC recommends that Relief Associations
consult their own tax advisors regarding the treatment of the plan and distributions from the plan under
state and federal tax laws.
MNFPC, LLC is not a law firm. We recommend review by your legal counsel of model documents before adoption.
2012 Appendix B DBV7.0
APPENDIX B
LAKE ELMO FIREFIGHTERS RELIEF ASSOCIATION
DEFINED BENEFIT LUMP SUM RETIREMENT PLAN
2012 Appendix B DBV7.0 i
TABLE OF CONTENTS
Page
ARTICLE I NAMES, PURPOSE AND OTHER GENERAL INFORMATION ........................................ 1
1.1
Name of Municipality ................................................................................................ 1
1.2
Name of Fire Department .......................................................................................... 1
1.3
Name of Relief Association ....................................................................................... 1
1.4
Federal Taxpayer Identification Number ................................................................... 1
1.5
Name of Plan .............................................................................................................. 1
1.6
Original Effective Date of Plan .................................................................................. 1
1.7
Purpose ....................................................................................................................... 1
ARTICLE II DEFINITIONS AND INTERPRETATION ............................................................................ 1
2.1
General Definitions .................................................................................................... 1
2.2
Interpretation .............................................................................................................. 4
ARTICLE III VESTING ............................................................................................................................... 4
3.1
Full Vesting of Accrued Benefit ................................................................................ 4
3.2
Partial Vesting of Accrued Benefit ............................................................................ 4
3.3
Determining Years of Active Service for Vesting ..................................................... 5
ARTICLE IV BENEFITS ............................................................................................................................. 5
4.1
Retirement Benefit ..................................................................................................... 5
4.2
Return To Service ...................................................................................................... 6
4.3
Deferred Interest ........................................................................................................ 7
4.4
Disability Benefit ....................................................................................................... 7
4.5
Survivor Benefit ......................................................................................................... 8
4.6
Funeral Benefit ........................................................................................................... 9
4.7
Supplemental Benefit ................................................................................................. 9
4.8
Supplemental Survivor Benefit ................................................................................ 10
4.9
Benefit Payment Requests ....................................................................................... 10
4.10
Forms of Payment .................................................................................................. 10
4.11
Maximum Limitation on Benefits .......................................................................... 10
4.12
Required Distributions ........................................................................................... 11
4.13
Unclaimed Benefits ................................................................................................ 11
ARTICLE V APPEALS PROCEDURE ..................................................................................................... 11
5.1
Right of Appeal ........................................................................................................ 11
5.2
Denial of Benefits .................................................................................................... 11
5.3
Review Procedure .................................................................................................... 11
ARTICLE VI CLAIMS AGAINST BENEFICIAL INTEREST ................................................................ 12
6.1
Nonassignability ...................................................................................................... 12
6.2
Charge for Litigation ................................................................................................ 12
6.3
Domestic Relations Orders ...................................................................................... 12
2012 Appendix B DBV7.0 ii
ARTICLE VII UNIFORMED SERVICE (MILITARY SERVICE) .......................................................... 13
ARTICLE VIII RIGHT TO AMEND, DISCONTINUE OR TERMINATE ............................................. 14
8.1
Amendment .............................................................................................................. 14
8.2
Consolidation and Plan Benefits .............................................................................. 15
8.3
Termination of Plan ................................................................................................. 15
ARTICLE IX MISCELLANEOUS ............................................................................................................ 15
9.1
Governing Law ........................................................................................................ 15
9.2
Binding Effect .......................................................................................................... 15
9.3
Effective Date Application ...................................................................................... 15
9.4
Authority of Board of Trustees ................................................................................ 16
2012 Appendix B DBV7.0 B-1
LAKE ELMO FIREFIGHTERS RELIEF ASSOCIATION
DEFINED BENEFIT LUMP SUM RETIREMENT PLAN
The Board of Trustees of the Relief Association amends and restates its existing defined
benefit pension plan in its entirety for the benefit of its eligible members.
ARTICLE I
NAMES, PURPOSE AND OTHER GENERAL INFORMATION
1.1 Name of Municipality: City of Lake Elmo
1.2 Name of Fire Department: Lake Elmo Fire Department
1.3 Name of Relief Association: Lake Elmo Firefighters Relief Association
Address: 3510 Laverne Avenue N, Lake Elmo, MN 55042
1.4 Federal Taxpayer Identification Number: 41-6077988
1.5 Name of Plan: Lake Elmo Firefighters Relief Association Defined Benefit Lump Sum
Retirement Plan
1.6 Original Effective Date of Plan: November 6, 1962
1.7 Purpose. The purpose of the Plan is to provide benefits to eligible members of the Relief
Association (Participants) and their lawful Beneficiaries.
ARTICLE II
DEFINITIONS AND INTERPRETATION
2.1 General Definitions. The following words and phrases when used herein shall have the
following meanings except as otherwise required by the context in which they are used:
(a) “Accrued Benefit” of a Participant shall mean the benefit determined under the
terms of the Plan, as of a specified date.
(b) “Active Service” shall mean active service as defined by the Fire Department, as
stated in its policies and procedures, except that Participants shall not receive
credit for Active Service for periods during which the Participant is:
(i) a full- or part-time employee of the Fire Department who accrues pension
service credit under the Public Employees Retirement Association of
Minnesota Police and Fire Fund for the same firefighting service.
2012 Appendix B DBV7.0 B-2
(c) “Alternate Payee” shall mean a spouse or former spouse of a Participant who is
recognized by a Domestic Relations Order as having a right to receive all, or a
portion of, a Participant’s Beneficial Interest under the Plan, pursuant to
Minnesota Statutes, Section 518.58, Subd. 4.
(d) “Beneficial Interest” shall mean the amount of a Participant’s Accrued Benefit
that is distributable to the Participant or the Participant’s Beneficiary in
accordance with the terms of the Plan.
(e) “Beneficiary” shall mean any person entitled to receive benefits that may be
payable upon or after a Participant’s death.
(f) “Board of Trustees” or “Board” shall mean the Board of Trustees of the Relief
Association.
(g) “Break in Service” shall mean a period as defined by the Fire Department in its
policies and procedures, during which the Participant does not meet Active
Service requirements. However, service restored pursuant to the uniformed
services provisions of Article VII shall be considered Active Service and shall not
be considered a Break in Service.
(h) “Bylaws” shall mean the duly adopted bylaws of the Relief Association.
(i) “Code” shall mean the Internal Revenue Code of 1986, and amendments thereto.
(j) “Disability” or “Disabled” shall mean the inability of a Participant to engage in
the performance of his or her duties by reason of a medically determinable
physical or psychological impairment that can be expected to last for a continuous
period of not less than twelve months or can be expected to result in death.
Disability must have arisen out of or have been causally connected with an act of
duty or a service related injury incurred while on leave for uniformed services
under Article VII. A Participant’s Disability shall be determined by the Board in
its sole discretion.
(k) “Disability Benefit” shall mean the benefit, if any, paid to a Participant in lieu of
a Retirement Benefit, pursuant to Section 4.4.
(l) “Domestic Relations Order” shall mean any judgment, decree or order
(including approval of a property settlement agreement) that complies with the
provisions of Minnesota Statutes Sections 518.58 or 518.581.
(m) “Effective Date” of the Plan shall be the effective date referenced on the first
page of the Bylaws.
(n) “Entry Date” shall mean the date of hire as defined in the Fire Department
policies and procedures.
2012 Appendix B DBV7.0 B-3
(o) “Participant” shall mean a member of the Relief Association who has accrued or
is accruing benefits under the Plan.
(p) “Plan Year” shall mean the calendar year.
(q) “Qualification Procedures” shall mean written procedures adopted by the Board
of Trustees to:
(i) determine whether a Domestic Relations Order may be honored under the
law and the terms of the Plan; and
(ii) to administer distributions under such orders.
The procedures shall be implemented within a reasonable time after receipt of a
domestic relations order by the Board of Trustees. Qualification Procedures must
permit an Alternate Payee to designate a representative for receipt of copies of
notices sent to the Alternate Payee with respect to a Qualified Domestic Relations
Order.
(r) “Qualified Recipient” shall mean an individual who receives a lump sum
distribution of pension or retirement benefits, including disability benefits, from
the Relief Association for service performed as a Volunteer Firefighter, as it
relates to Section 4.7 herein.
(r) “Resumption of Active Service Requirement” shall mean the period of time
equal to the period of time that elapsed between the Participant’s Separation Date
and return to Active Service pursuant to Section 4.2.
(s) “Retirement Benefit” shall mean the benefit payable to a Participant pursuant to
Section 4.1, but only after the Participant has met all eligibility requirements of
Section 4.1.
(t) “Separation Date” shall mean the date of retirement or termination as defined in
the Fire Department policies and procedures.
(u) “Special Fund” shall mean the fund established pursuant to Minnesota Statutes,
Section 424A.05 used to fund benefits under the Plan and for other purposes
permitted by statute. The assets of the Special Fund shall be invested only in
securities authorized by Minnesota Statutes, Section 69.775.
(v) “Supplemental Benefit” shall mean the benefit paid to a Qualified Recipient
pursuant to Minnesota Statutes, Section 424A.10, Subd. 2(a), as described in
Section 4.7.
(w) “Supplemental Survivor Benefit” shall mean the benefit, if any, paid to a
Surviving Spouse or minor Surviving Children pursuant to Minnesota Statutes,
Section 424A.10, Subd. 2(b), as described in Section 4.8.
2012 Appendix B DBV7.0 B-4
(x) “Surviving Children” shall mean any unmarried person under the age of 18 who
is a natural or adopted child of a deceased Participant. The term also includes any
child of the Participant who was conceived during the lifetime of, and who was
born after the death of the Participant.
(y) “Surviving Spouse” shall mean the spouse of a deceased Participant who was
legally married to the Participant at the time of death.
(z) “Survivor Benefit” shall mean the benefit paid to a Participant’s Beneficiary
pursuant to Section 4.5.
(aa) “Volunteer Firefighter” shall mean any person who:
(i) is engaged in providing emergency response services or delivering fire
education or prevention services as a firefighter for the Fire Department or
Municipality;
(ii) is trained in or is qualified to provide fire suppression duties or to provide
fire prevention duties under Minnesota Statutes, Section 424A.001, Subd.
8; and
(iii) meets any other minimum firefighter and service standards established by
the Fire Department or Municipality.
(bb) “Year of Active Service” shall mean each 12-month period of Active Service
commencing with a Participant’s Entry Date or anniversary thereof reduced by
the Participant’s Break(s) in Service. This definition shall be used for the
purposes of calculating the minimum funding requirements and computing
benefits or service pensions payable. Service pensions will be prorated monthly
for fractional Years of Active Service pursuant to Minnesota Statutes, Section
424A.02, Subd. 1.
2.2 Interpretation. The words defined in this Article 2 shall have the meanings assigned to
them except where specified otherwise in this instrument. Whenever appropriate, words used
herein in the singular shall include the plural, the plural may be read as the singular, and the
masculine shall include the feminine.
ARTICLE III
VESTING
3.1 Full Vesting of Accrued Benefit. A Participant shall have a fully vested and non-
forfeitable interest in the Participant’s Accrued Benefit upon completion of 20 Years of Active
Service.
3.2 Partial Vesting of Accrued Benefit. The following vesting schedule shall apply to a
Participant with fewer than 20 Years of Active Service:
2012 Appendix B DBV7.0 B-5
Years of Active Service Vested Percentage
10 but less than 11 60%
11 but less than 12 64%
12 but less than 13 68%
13 but less than 14 72%
14 but less than 15 76%
15 but less than 16 80%
16 but less than 17 84%
17 but less than 18 88%
18 but less than 19 92%
19 but less than 20 96%
20 or more 100%
3.3 Determining Years of Active Service for Vesting. All Years of Active Service shall be
taken into account for purposes of determining a Participant’s vested Accrued Benefit, including
Years of Active Service with the Fire Department prior to the Effective Date.
ARTICLE IV
BENEFITS
4.1 Retirement Benefit. (a) Eligibility. To be eligible to receive a Retirement Benefit a
Participant must satisfy each of the following requirements:
(i) Have retired or ceased Active Service with the Fire Department;
(ii) Be at least 50 years of age;
(iii) Have been a Volunteer Firefighter in the Fire Department;
(iv) Have been a member in the Relief Association; and
(v) Have the minimum Years of Active Service required for a non-forfeitable
interest (vested) in the Participant’s Accrued Benefit.
(b) Amount. If so provided in Section 3.2, a Participant’s Retirement Benefit shall be
determined as follows:
Years of Active
Service credited
to Participant
multiplied
by
Benefit level in
effect for
Participant
multiplied
by
Vesting
percentage for
completed Years
of Active Service
The benefit level is set forth in Appendix C. The Participant’s benefit level will be the benefit
level in effect at the Participant’s Separation Date. However, if the Participant had a Break in
Service, the Participant’s benefit level shall be determined as described in Section 4.2.
2012 Appendix B DBV7.0 B-6
Subject to the provisions of Section 8.1 of this Appendix B, benefit levels are subject to increase
and shall be effective as of the agreed upon effective date, provided that such increase shall not
apply to any Participant who ceased Active Service before the effective date of the increase.
Such Retirement Benefit shall not be paid before the later of the Participant’s Separation Date or
the date the Participant attains age 50. The Retirement Benefit shall be paid at the time requested
by the Participant in a properly completed and accepted Retirement Benefit Payment Request
Form.
4.2 Return To Service. (a) Return to Service Before Payment of Retirement, Disability or
Survivor Benefit. If a Participant:
(i) Ceases Active Service with the Fire Department (incurs a Separation
Date),
(ii) Has not received a Retirement Benefit distribution from the Plan of the
Participant’s vested Accrued Benefit, and
(iii) Subsequently returns to Active Service after at least 60 days have elapsed,
the Participant shall qualify for increases in the benefit level implemented
during or after the Separation Date from Active Service and additional
Years of Active Service only if the Participant remains in Active Service
for the Resumption of Active Service Requirement. If the Participant has
not met this requirement by the time of the Participant’s later Separation
Date, the Participant’s benefit shall be the benefit level in effect at the time
of the Participant’s prior Separation Date and Years of Active Service in
effect at the time of the Participant’s prior Separation Date plus Years of
Active Service after the Participant’s resumption of Active Service.
A Participant whose period of Break in Service does not exceed 365 consecutive days is exempt
from the minimum period of Resumption of Active Service Requirement.
(b) Return to Service After Payment of Retirement Benefit. If a Participant:
(i) Ceases Active Service with the Fire Department (incurs a Separation Date)
(ii) Receives a Retirement Benefit distribution from the Plan of the
Participant’s vested Accrued Benefit,
(iii) Subsequently returns to Active Service after at least 60 days have elapsed,
the Participant shall be credited with additional Years of Active Service.
A Participant’s Retirement, Disability or Survivor Benefit at the
Participant’s later Separation Date shall be determined as follows:
2012 Appendix B DBV7.0 B-7
Years of
Additional
Active Service
credited to
Participant after
the return to
service
multiplied
by
Benefit level in
effect for
Participant as of
the subsequent
Separation Date
multiplied
by
Vesting
percentage for
completed
Additional
Years of Active
Service
No Participant may be paid a service pension twice for the same period of Active Service.
4.3 Deferred Interest.
The Board of Trustees shall adjust only a fully vested Participant’s unpaid Retirement Benefit
amount at an interest rate up to five percent, compounded annually. The interest rate shall be set
by the Board of Trustees, subject to approval by the Municipality. Interest is payable from the
first day of the month next following the date on which the Municipality has approved the
deferred service pension interest rate established by the Board or from the first day of the month
next following the date on which the Participant separated from active Fire Department service
and Relief Association membership, whichever is later, to the last day of the month immediately
before the month in which the Participant becomes eligible to begin receipt of, and applies for,
the Retirement Benefit. The interest rate is set forth in Appendix C.
4.4 Disability Benefit. A Participant who becomes Disabled while in Active Service may be
eligible for a Disability Benefit in lieu of a Retirement Benefit. A Participant who becomes
Disabled while on leave for uniformed services under Article VII shall be deemed to have
become Disabled while in Active Service. A Participant’s Disability Benefit shall be determined
as follows:
Years of Active Service
credited to Participant
multiplied
by
Benefit level in effect when
Participant becomes Disabled
The benefit level is set forth in Appendix C. Subject to the provisions of Section 8.1 of this
Appendix B, such dollar amount is subject to increase and shall be effective as of the agreed
upon effective date, provided that such increase shall not apply to any Participant who ceased
Active Service before the effective date of the increase.
Any Disability Benefit paid in accordance with this Section 4.4 shall be in lieu of all rights to
further service pension and survivors benefits.
The Participant shall be eligible to receive the Disability Benefit upon approval of the Board of
Trustees. A written report of a physician of the Participant’s choice shall be required for payment
of a Disability Benefit. The report shall set forth the diagnosis and prognosis of the Disability,
disease or injury of the Participant and its probable duration of permanence. A Participant’s
statement as to pain or other symptoms will not alone be conclusive evidence of Disability.
A Disability Benefit Payment Request form shall be submitted to the Board of Trustees within
six months after such Participant’s Separation Date with the Fire Department. The form shall
2012 Appendix B DBV7.0 B-8
describe the nature and cause of such Disability. The form shall be under oath by the Participant
or his/her immediate family. The determination of Disability shall be tabled until the next Board
meeting so that a physician of the Participant’s choice may examine the Participant. The Board
of Trustees has the discretion to request that another doctor, selected by the Board of Trustees,
examine the Participant. Final determination of Disability will be based on the reports of at least
one doctor, and shall be determined by the Board of Trustees at the subsequent Board meeting.
If the Participant who applied for a Disability Benefit disagrees with the Board’s determination,
the Participant may, within sixty (60) days from notice of such action of the Board of Trustees,
file a written appeal of the Board of Trustees’ determination. The appeal will be decided under
the appeal procedures described in Article V.
4.5 Survivor Benefit. (a) Eligibility. For a Participant’s Beneficiary to be eligible to receive
a Survivor Benefit, the Participant must have satisfied the following requirements:
(i) Have died in Active Service with the Fire Department; or
(ii) Have died prior to receiving his Retirement Benefit.
A Participant who dies while on leave for uniformed service under Article VII shall be deemed
to have died while in Active Service.
(b) Amount. If a Participant in Active Service dies, the Participant’s Beneficiary shall
receive a lump sum payment equal to 100% of the Participant’s Accrued Benefit.
The Survivor Benefit paid on behalf of a Participant in Active Service who dies before having
completed five Years of Active Service shall be determined as if the Participant had completed
five Years of Active Service.
If a Participant who has retired from or ceased Active Service dies, the Participant’s Beneficiary
shall receive a lump-sum Survivor Benefit determined as follows:
Years of Active
Service credited
to Participant
multiplied
by
Benefit level in
effect for
Participant
multiplied
by
Vesting
percentage for
completed Years
of Active Service
The Survivor Benefit level will be the benefit level in effect at the Participant’s Separation Date.
However, if the Participant had a Break in Service, the Survivor Benefit level shall be
determined as described in Section 4.2.
2012 Appendix B DBV7.0 B-9
Such Survivor Benefit shall be paid to the Participant’s Beneficiary as soon as administratively
feasible following the Participant’s death and the approval of the Survivor Benefit Payment
Request form.
A Participant’s Beneficiary shall be as follows:
(i) the Participant’s Surviving Spouse; or
(ii) if no Surviving Spouse, the Participant’s Surviving Children or if so
designated as a Beneficiary by the Participant, a trust for the benefit of the
Participant’s Surviving Children created under Chapter 501B; or
(iii) if no Surviving Spouse or Surviving Children, the Participant’s designated
Beneficiary or Beneficiaries. To designate a Beneficiary, the Participant
shall complete, sign and file with the Relief Association a designation of
Beneficiary on a form to be provided by the Relief Association or by other
written form acceptable to the Relief Association. On said form, the
Participant shall designate a Beneficiary, which must be a natural person,
or a designated trust created under Chapter 501B of the Minnesota
Statutes that shall be paid any sum that may be payable on account of the
Participant’s death (reserving, however, to the Participant the power to
change the designation of Beneficiary using the Change of Beneficiary
Designation form); or
(iv) if no designated Beneficiary or Beneficiaries, to the estate of the
Participant.
If there is a Surviving Spouse, but no Surviving Children, the Surviving Spouse may waive in
writing all or a part of the Survivor Benefit otherwise payable to the Surviving Spouse, in which
event, the Survivor Benefit waived shall be paid as if the spouse had predeceased the Participant.
4.6 Funeral Benefit. No Funeral Benefit shall be paid under this Plan.
4.7 Supplemental Benefit. Upon payment of a lump sum distribution, the Relief Association
must pay a Supplemental Benefit to the Qualified Recipient. The Supplemental Benefit may be
paid from the Special Fund. The amount of the Supplemental Benefit equals ten percent of the
lump sum distribution, excluding any interest paid during a period of deferral, but in no case may
the Supplemental Benefit exceed $1,000.
2012 Appendix B DBV7.0 B-10
4.8 Supplemental Survivor Benefit. Upon payment of a Survivor Benefit, the Relief
Association must pay a Supplemental Survivor Benefit to the Surviving Spouse, or, if none, the
Surviving Child(ren) of a Participant who had at least one (1) month of Active Service. The
Supplemental Survivor Benefit shall be paid in lieu of the Supplemental Benefit and shall be
paid from the Special Fund. The amount of the Supplemental Survivor Benefit equals twenty
(20) percent of the lump sum distribution, but in no case may the Supplemental Survivor Benefit
exceed $2,000.
4.9 Benefit Payment Requests. Requests for benefit payment shall be in writing and filed
with the Relief Association not less than 90 days prior to the next Board meeting, unless
permitted earlier by the Board. Such request shall be made on the appropriate form described
below:
Requested Benefit Required Benefit Form
Retirement Retirement Benefit Payment Request
Survivor Survivor Benefit Payment Request
Disability Disability Benefit Payment Request
(if applicable)
Requests for Plan benefits shall be considered valid when approved by the Board. Upon
approval of the request, the Board shall pay the Participant within 90 days and provide notices to
the Participant as required by state or federal law with respect to pension or benefit payments,
including, if required, the Special Tax Notice Regarding Plan Payments.
4.10 Forms of Payment. Plan benefits payable to a Participant or Beneficiary shall be made in
single lump sum payment. The Participant shall specify that the payment be made in the manner
of:
(a) a check payment payable to the Participant or Beneficiary, subject to federal
income tax withholding, as may be required; or
(b) a direct rollover to an individual retirement account described in Section 408(a) of
the Code to the extent permitted by law, or
(c) a transfer to the Participant’s account in the Minnesota Deferred Compensation
Plan , to the extent permitted by law and the Minnesota Deferred Compensation
Plan.
No other forms of distributions are allowed under the Plan.
4.11 Maximum Limitation on Benefits. Notwithstanding any provision of the Plan to the
contrary, a Participant’s benefit under the Plan shall not exceed the maximum amount permitted
under Section 415 of the Code. Service pensions shall be further limited to the maximum
amounts payable pursuant to Minnesota Statutes, Section 424A.02, Subd. 3.
2012 Appendix B DBV7.0 B-11
4.12 Required Distributions. Notwithstanding any provision of the Plan to the contrary, a
Participant’s benefit shall be paid to the Participant by April 1 of the calendar year following the
later of the calendar year in which the Participant attains age 70½ or ceases Active Service. Such
distributions shall be determined and made in accordance with Section 401(a)(9) of the Code and
regulations promulgated there under, including the minimum distribution incidental benefit
requirement of Treasury Reg. Section 1.401(a)(9)-2, the provisions of which are incorporated
herein by reference.
4.13 Unclaimed Benefits. If the Relief Association is unable with reasonable effort to locate a
Participant or person/estate entitled to a Survivor Benefit under the Plan or applicable law, the
benefit distributable to such Participant or person/estate shall be forfeited and will be credited to
the Special Fund. Efforts to locate a Participant or person/estate must be documented. Forfeiture
shall occur no earlier than thirty-six (36) months after the Board concludes the Relief
Association was unable to locate such Participant or person/estate despite reasonable efforts to
do so.
ARTICLE V
APPEALS PROCEDURE
5.1 Right of Appeal. In the event the Board of Trustees denies a written request for a
Retirement, Disability or Survivor Benefit, the Participant or Beneficiary whose request was
denied (a “claimant”) shall be entitled to appeal the determination.
5.2 Denial of Benefits. If a written request is not approved, the Board shall return the form to
the claimant within 30 days, noting which requirements the claimant does not meet. Thereafter,
the claimant shall be furnished with the opportunity to be heard by the Board, on the question of
whether the claimant meets all of the eligibility requirements. A claimant who intends to appeal
must furnish the Board with a written notice of appeal within 30 days of receiving an adverse
determination.
5.3 Review Procedure. Upon receipt of the written notice of appeal, the Board of Trustees
shall hold a special meeting within 60 days. Timely notice of the meeting shall be given to the
claimant at least 15 days prior to the special meeting. The claimant shall have the reasonable
opportunity to be heard by the Board of Trustees at the special meeting with regard to the
negative determination. The Board shall decide the appeal and shall give the claimant written
notice of its decision.
The exhaustion of these claims procedures is mandatory for resolving every claim and dispute
arising under these Bylaws. Any legal action to recover benefits or to enforce or clarify rights
under the Bylaws must be commenced in the proper forum within 120 days after the claimant has
exhausted the claims procedures. For all purposes, knowledge of all facts that the Participant
knew or reasonably should have known shall be imputed to every claimant who is or claims to be
a beneficiary of the Participant or otherwise claims to derive an entitlement by reference to the
Participant. The Board has full discretion to determine benefit claims under the Bylaws. Any
interpretation, determination or other action of the Board shall be subject to review only if it is
arbitrary or capricious or otherwise an abuse of discretion. Any review of a final decision or
2012 Appendix B DBV7.0 B-12
action of the Board shall be based only on such evidence presented to or considered by the Board
at the time it made the decision that is the subject of review.
ARTICLE VI
CLAIMS AGAINST BENEFICIAL INTEREST
6.1 Nonassignability. No Participant or Beneficiary shall have any transmissible interest in
the Plan or in the Participant’s separate Beneficial Interest therein, either before or after the
vesting thereof, or in any of the assets comprising the same prior to actual payment and
distribution thereof, and shall have no power to alienate, dispose of, pledge or encumber the
same, while in the possession or control of the Plan, nor shall the Plan recognize any assignment
thereof, either in whole or in part, nor shall the interest of any Participant or Beneficiary be
subject to attachment, garnishment, execution or other legal process while in the hands of the
Plan, except as provided in Minnesota Statutes, Section 518A.53 or as otherwise provided
herein.
6.2 Charge for Litigation. In the event that any Participant or any person claiming by or
through a Participant should commence any equitable or legal proceedings against the Relief
Association, the result of which is adverse to the plaintiff, or in the event that the Relief
Association should find it necessary to commence any such proceeding against any Participant or
any person claiming by or through a Participant, the result of which is adverse to the defendant,
the cost to the Relief Association of defending or bringing the proceeding, as the case may be,
shall be charged, to the extent possible and permitted by law, to the Accrued Benefit of the
Participant and only the excess of such cost over the amount of the Participant’s Accrued Benefit
shall be included as an expense of administration.
6.3 Domestic Relations Orders. Notwithstanding any provision to the contrary herein, the
Board of Trustees may assign the interest of a Participant in the Plan to an Alternate Payee
pursuant to a Domestic Relations Order. In the event the Plan receives a Domestic Relations
Order with respect to a Participant’s Beneficial Interest in the Plan, the following provisions
shall apply:
(t) The Board shall promptly give written notification to the Participant and to the
Alternate Payee of receipt of a domestic relations order and of Plan Qualification
Procedures. The Board shall then proceed with Qualification Procedures to
determine whether the order is a Domestic Relations Order and can be honored.
The Board shall then notify the Participant and Alternate Payee (or the Alternate
Payee’s designated representative) of its determination.
(u) Disputed funds shall be disposed of as follows:
(i) During the period in which the Qualification Procedures are in progress,
the Board shall separately account for any amounts that would be payable
to an Alternate Payee if the Domestic Relations Order can be honored.
2012 Appendix B DBV7.0 B-13
(ii) If it is determined the Domestic Relations Order can be honored within the
18-month period commencing on the date payments are to begin under the
order, the Board shall pay the amounts designated in the order, including
any interest, to the Alternate Payee.
(iii) If the Board determines that the Domestic Relations Order cannot be
honored or if the 18-month period described in (ii) above elapses and the
qualification dispute has not been resolved, the Board shall pay the
segregated amounts, together with earnings or losses, if required, to the
persons who would have received the amounts if the order had not been
issued.
(iv) If an order is qualified after expiration of the 18-month period described in
(ii) above, payment of benefits to an Alternate Payee shall proceed
prospectively and the Plan shall not be liable to an Alternate Payee for
benefits attributable to the period prior to qualification.
(v) Payment of benefits pursuant to a Domestic Relations Order shall be made only as
permitted under the Plan. Payment to an Alternate Payee may not commence until
the Participant submits a valid Retirement Benefit Payment Request form and the
Participant’s benefit becomes payable.
(w) If a Domestic Relations Order does not address and determine the payment of the
Supplemental Benefit payable under Section 4.7 in connection with the payment
of a Retirement Benefit, the Supplemental Benefit shall be divided between the
Participant and the Alternate Payee in the same proportion as the Retirement
Benefit is so divided. In addition, the Board cannot honor a Domestic Relations
Order requiring that Supplemental Survivor Benefits be paid to anyone other than
the persons listed in Section 4.8 in the order there listed.
(x) To the extent permitted by law and except as otherwise provided under a
Domestic Relations Order, the Board may, on a uniform basis, charge the
reasonable and necessary expenses associated with the review of a Domestic
Relations Order and the implementation of a Domestic Relations Order to the
accounts of the Participant and Alternate Payee.
ARTICLE VII
UNIFORMED SERVICE (MILITARY SERVICE)
Subject to restrictions stated in this section, a Participant who is absent from firefighting service
due to service in the uniformed services, as defined in the Uniformed Services Employment and
Reemployment Rights Act (“USERRA”), will be granted Active Service credit under the Plan
for the period of the uniformed service, not to exceed five years, unless a longer period is
required under USERRA.
2012 Appendix B DBV7.0 B-14
To be eligible for such credit, the Participant must return to firefighting service with coverage by
the Relief Association (or by the successor to the Relief Association) upon discharge from
service in the uniformed service within the time frame required in USERRA. However, Active
Service credit is not authorized if the Participant separates from uniformed service with a
dishonorable or bad conduct discharge or under other than honorable conditions.
Active Service credit is not authorized if the Participant fails to provide notice to the Fire
Department that the Participant is leaving to provide service in the uniformed service, unless it is
not feasible to provide that notice due to the emergency nature of the situation.
If the Participant does not return to Active Service with the Fire Department within the time
frame required in USERRA, then except as otherwise provided in the following sentence, it shall
be conclusively presumed that the Participant’s Active Service terminated as of the date that the
leave for uniformed services began. A Participant who dies or becomes Disabled while the
Participant is on leave for uniformed services shall be deemed to have returned to Active Service
and shall be deemed to have accrued years of Active Service during the period of leave for
uniformed services.
ARTICLE VIII
RIGHT TO AMEND, DISCONTINUE OR TERMINATE
8.1 Amendment. Except as herein otherwise limited, the Relief Association shall have the
right to amend this Plan, pursuant to Section 12.3 of the Bylaws, at any time to any extent that it
may deem advisable. Such amendment will be stated in an instrument in writing executed by the
Relief Association. Upon adoption and execution of such instrument, this Plan shall be deemed
to have been amended in the manner therein set forth, and Participants shall be bound thereby.
If the Special Fund does not have a surplus over full funding pursuant to Minnesota Statutes,
Section 69.772, Subd. 3, clause (b), or Minnesota Statutes 69.773, Subd. 4, and if the
Municipality is required to provide financial support to the Special Fund pursuant to Minnesota
Statutes, Section 69.772 or 69.773, no amendment that would affect the amount of, the manner
of payment of, or the conditions for qualification for service pensions or ancillary benefits or
disbursements other than administrative expenses authorized pursuant to Minnesota Statutes
69.80 payable from the Special Fund shall be effective until it has been ratified by the governing
body or bodies of the Municipality.
If the Municipality is not required to provide financial support to the Special Fund, the Relief
Association may adopt an amendment of the Plan that increases or otherwise affects the service
pensions or ancillary benefits payable from the Special Fund without municipal ratification so
long as the changes do not cause the amount of the resulting increase in the accrued liability of
the Special Fund to exceed 90 percent of the amount of the prior surplus over full funding and
the changes do not result in the financial requirements of the Special Fund exceeding the
expected amount of the future fire state aid to be received by the Relief Association.
The financial requirements are to be determined by the Board of Trustees following the
preparation of an estimate of the expected increase in the accrued liability and annual accruing
liability of the Relief Association attributable to the change. If the Relief Association adopts or
2012 Appendix B DBV7.0 B-15
amends the Plan without municipal ratification, and, subsequent to the amendment or adoption,
the financial requirements of the Special Fund are such so as to require financial support from
the Municipality, the provision that was implemented without municipal ratification shall no
longer be effective without municipal ratification, and any service pensions or ancillary benefits
payable with respect to the unapproved increase shall no longer be effective as of the January 1
of the year for which the Schedules I and II for the municipal contribution became due, and as of
that January 1, service pensions or ancillary benefits shall be paid only in accordance with
provisions of the Plan as amended or adopted with municipal ratification.
8.2 Consolidation and Plan Benefits. The Relief Association has not been consolidated with
another relief association pursuant to Minnesota Statutes, Section 424B.02.
8.3 Termination of Plan. Upon dissolution of the Relief Association, after the settlement of
nonbenefit legal obligations of the Special Fund, the Board shall transfer the remaining assets of
the Special Fund, as securities or in cash, as applicable, to the chief financial official of the
Municipality. The Board shall also compile a schedule of Participants to whom a service
pension is or will be owed, any Beneficiary to whom a benefit is owed, the amount of the service
pension or benefit payable based on the Bylaws and state law and the service rendered to the date
of the dissolution, and the date on which the pension or benefit would first be payable under the
Bylaws and state law.
The Municipality receiving the remaining assets of the Special Fund shall establish a separate
account in the municipal treasury to function as a trust fund for Participants and their
Beneficiaries eligible for Plan benefits. Upon submission of the proper form, on or after the
initial date on which the service pension or benefit is payable, the municipal treasurer shall pay
the pension or benefit due, based on the schedule described above and the other records of the
dissolved Relief Association. The trust fund must be invested and managed consistent with
Minnesota Statutes Section 69.775 and Chapter 356A. Upon payment of the last service pension
or benefit due and owing, any remaining assets in the trust fund may be transferred to the general
fund of the municipality. If the Special Fund had an unfunded actuarial accrued liability upon
dissolution, the Municipality is liable for that unfunded actuarial accrued liability.
ARTICLE IX
MISCELLANEOUS
9.1 Governing Law. This Plan shall be construed, administered, and governed in all respects
under the laws of the State of Minnesota, except as preempted by federal law.
If any Minnesota laws are applicable solely to the Relief Association, then an Appendix F will be
included to describe such laws.
9.2 Binding Effect. This Plan shall be binding upon and inure to the benefit of the heirs,
personal representatives, successors and assigns of any and all of the parties hereto.
9.3 Effective Date Application. If a member’s Separation Date is prior to the Effective Date,
the member’s status and benefit under the Plan, if any, attributable to Active Service, shall be
2012 Appendix B DBV7.0 B-16
determined and paid in accordance with the provisions of the Plan in effect at the Separation
Date.
If a member had a Separation Date prior to the Effective Date, but returns to complete a Year of
Active Service that ends after the Effective Date, the member’s status and benefits under the Plan
for all Active Service shall be determined in accordance with the provisions of the Plan in effect
at the subsequent Separation Date.
9.4 Authority of Board of Trustees. The Board of Trustees shall have full power, authority
and discretion to do each and every act and thing which it is specifically required or permitted to
do under the provisions of the Plan and to determine conclusively for all parties all questions
arising in the interpretation or administration of the Plan.