12-4-2000 pers (3)COUNCIL AGENDA REPORT
MEETING DATE: 12/04/00 ITEM NO.
ADOPT RESOLUTION OF THE TOWN OF LOS GATOS IMPLEMENTING THE EMPLOYER PICKUP PRE-TAX PAYROLL DEDUCTION PLAN FOR SERVICE CREDIT PURCHASES
RECOMMENDATION:
Adopt resolution of the Town of Los Gatos implementing the Employer Pickup Pre-Tax Payroll Deduction Plan for service credit purchases.
DISCUSSION:
CaIPERS regulations permit Town employees who have worked in Ca1PERS agencies or the military, to purchase previous service credit. Employees who elect to purchase service credit currently
do so on a post-tax basis, By filing a resolution with Ca1PERS, the Town is allowed to extend the pick-up of member contributions under Internal Revenue Code section 414(h)(2) for service
credit purchases. The Employer Pickup Pre-tax Payroll Deduction Plan will provide employees, who elect to participate, with the benefit of deferring income tax liability on service credit
purchases.
ENVIRONMENTAL ASSESSMENTS:
Is not a project defined under CEQA, and no further action is required. FISCAL IMPACT:
Adoption of the resolution will have no fiscal impact on the Town of Los Gatos. Attachments:
Resolution of the Town of Los Gatos implementing the Employer Pickup Pre-Tax Payroll Deduction Plan for service credit purchases
PREPARED BY: GARY ROGERS, Human Resources Manag N:IMGRIGROGERSICNFICOUNCILISERV CREDICOUNRPT
Reviewed by: Attorney mance Revised: 11/16/00 3:13 PM
RESOLUTION NO, RESOLUTION OF THE TOWN OF LOS GATOS IMPLEMENTING THE EMPLOYER PICKUP PRE-TAX PAYROLL DEDUCTION PLAN
FOR SERVICE CREDIT PURCHASES ******:***********************************************************************
EMPLOYER CODE: 0870
EMPLOYER PICKUP RESOLUTION
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 Town of Los Gatos 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 those employees who are members of Ca1PERS; and
WHEREAS, the Town of Los Gatos elects to participate in the pre-tax payroll deduction plan for all employees in the following Ca1PERS coverage group(s):
Miscellaneous 70001
Police 75001
NOW THEREFORE, BE IT RESOLVED:
That the Town of Los Gatos will implement the provisions of IRC Section 414 (h) (2) by making employee contributions for service credit purchases pursuant to California State Government
Code on behalf of its employees who are members of Ca1PERS 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 Ca1PERS which are deducted from the salary of employees and are credited to individual employee accounts for service credit purchases, thereby
resulting in tax deferral of employee contributions.
II. That the contributions made by the Town of Los Gatos to Ca1PERS, although designated as employee contributions, are being paid by the Town of Los Gatos in lieu of contributions by
the employees who are members of Ca1PERS.
That the employees shall not have the option of choosing to receive the contributed amounts
directly instead of having them paid by the Town of Los Gatos to the Ca1PERS.
That the Town of Los Gatos 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.
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.
That the governing body of the Town of Los Gatos 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 Group(s) who have elected to participate in this plan.
PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los Gatos, California, held on the day of June, 2000 by the following vote:
COUNCIL MEMBERS:
AYES:
NAYES:
ABSENT:
ABSTAIN:
SIGNED:
MAYOR OF THE TOWN OF LOS GATOS
LOS GATOS, CALIFORNIA
ATTEST:
CLERK OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA
RETURN ADDRESS:
Town of Los Gatos P. O. Box 949
Los Gatos, CA 95031
******************************************************************************
FOR CALPERS USE ONLY Pre-tax Payroll Deduction Plan Effective Date:
Approved By: Title: Member Services Division, Service Credit Section - Unit 830
RESOLUTION 2000 - 142.
RESOLUTION OF THE TOWN OF LOS GATOS IMPLEMENTING THE EMPLOYER PICKUP PRE-TAX PAYROLL DEDUCTION PLAN FOR SERVICE CREDIT PURCHASES
EMPLOYER CODE: 0870
EMPLOYER PICKUP RESOLUTION 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 Town of Los Gatos 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 those employees who are members of Ca1PERS; and
WHEREAS, the Town of Los Gatos elects to participate in the pre-tax payroll deduction plan for all employees in the following Ca1PERS coverage group(s):
Miscellaneous 70001
Police 75001
NOW THEREFORE, BE IT RESOLVED:
I. That the Town of Los Gatos will implement the provisions of IRC Section 414 (h) (2) by making employee contributions for service credit purchases pursuant to 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 employee accounts for service credit purchases, thereby
resulting in tax deferral of employee contributions.
That the contributions made by the Town of Los Gatos to CaIPERS, although designated as employee contributions, are being paid by the Town of Los Gatos in lieu of contributions by the
employees who are members of Ca1PERS.
That the employees shall not have the option of choosing to receive the contributed amounts directly instead of having them paid by the Town of Los Gatos to the Ca1PERS.
That the Town of Los Gatos shall pay to Ca1PERS 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.
That the effective date for commencement of the pretax 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.
That the governing body of the Town of Los Gatos 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 Group(s) who have elected to participate in this plan.
PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los Gatos, California, held on the 4th day of December , 2000 by the following vote:
COUNCIL MEMBERS:
AYES: Randy Attaway, Steven Blanton, Sandy Decker, Steve Glickman, Mayor Joe Pirzynski.
NAYS: None
ABSENT: None
ABSTAIN: None
SIGNED:/s/ Joe Pirzynski
MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA
ATTEST:
Is/ Marian V. Cosgrove
CLERK OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA