Berkeley Municipal Code Art. 4 Accounts and Vesting

The committee shall establish and maintain an account for each participant in which shall be recorded the amount of such participant’s share of the employer’s contribution, income or loss of the trust, withdrawals and all other information affecting the value of such account. (Ord. 6747-NS § 1, 2003)

Upon making an employer contribution to the trust, the employer shall notify the committee or its designee in writing as to the amount of each such contribution made on behalf of each participant. The committee or its designee shall then allocate such contributions to the accounts of the participants for whom such contributions were made.

The above notwithstanding, the amount of employer contributions for any participant shall not exceed in any one plan year the sum of $30,000 plus any permissible cost-of-living adjustments under regulations issued by the Secretary of Treasury pursuant to the provisions of Section 415(d) of the Internal Revenue Code. (Ord. 6747-NS § 1, 2003)

4.36.402(A) Limitation on allocations to participants.

Notwithstanding any other provisions of the plan:

A. Limitations applicable to participants in defined contribution plans only.

1. The annual additions, as defined in Internal Revenue Code Section 415(c)(2), credited to a participant’s accounts (exclusive of any amounts credited in accordance with Section 4.36.403) for any plan year commencing on or after January 1, 1988 shall not exceed the lesser of (a) $30,000 or such larger amount, as may be specified by the Secretary of Treasury or their delegate on account of increases in the cost of living as provided in Section 415(d) of the Internal Revenue Code of 1986 as amended (Code), or (b) 25% of the participant’s compensation (as defined in subsection D. for purposes of this section, and subsections B. and C. of this plan) for such year.

2. In the case of any participant who also participates in a related plan (such a plan shall mean any defined contribution plan (as defined in Section 415(k) of the Code), other than this plan, maintained by the employer, including, if applicable, after December 31, 1985 any welfare benefit fund that is defined in Section 419(e) of the Code), the sum of their annual addition under the plan and their annual addition under all related plans for any plan year commencing on or after January 1, 1988, shall not exceed the lesser of (a) the amount set forth in paragraph A, 1(a) above or (b) 25% of the sum of (1) the participant’s compensation for such year and (2) their remuneration for such year. The compensation limitation referred to in subparagraph (b) shall not apply to any contribution for medical benefits (within the meaning of Section 401(h) or Section 419A(f)(2) of the Code) which is otherwise treated as an annual addition under Section 415(l)(1) or Section 419A(d)(2) of the Code.

3. To the extent necessary to satisfy the limitations of paragraphs A, 1. and A, 2. above, the committee shall reduce the net contribution it would otherwise make for the participant’s benefit for the applicable plan year.

B. The combined limitations applicable to participants who also participate in a defined benefit plan are repealed effective for plan years beginning on and after January 1, 2000.

C. Adjustments on account of excessive credits. If the amount credited to a participant’s accounts for any plan year would exceed the amount permitted under the limitations of subsection A. above, corrections will be made, as determined by the committee pursuant to the Employee Plans Compliance Resolution System described in Revenue Procedure 2016-51, as may further be modified by the Internal Revenue service from time to time (collectively, "EPCRS").

D. Code Section 415 compensation definition. Participant’s compensation for the purposes of this section shall mean a participant’s earned income, wages, salaries, bonuses and fees for professional services, and other amounts received for personal services actually rendered in the course of employment with the employer maintaining the plan and excluding the following:

1. Employer contributions to a plan of deferred compensation which are not included in the employee’s gross income for the taxable year in which contributed, or employer contributions under a simplified employee pension plan to the extent such contributions are deductible by the employee, or any distributions from a plan of deferred compensation;

2. Amounts realized from the exercise of a non-qualified stock option, or when restricted stock (or property) held by the employee either becomes freely transferable or is no longer subject to a substantial risk of forfeiture;

3. Amounts realized from the sale, exchange or other disposition of stock acquired under a qualified stock option;

4. Other amounts which received special tax benefits, or contributions made by the employer (whether or not under a salary reduction agreement) toward the purchase of an annuity described in Section 403(b) of the Code (whether or not the amounts are actually excludable from the gross income of the employee).

Notwithstanding the foregoing, for plan years beginning on and after January 1, 1998, compensation shall include any amount that would have been included in the foregoing description, but for the participant’s election to defer payment under Section 125, 402(e)(3), 402(h)(1)(B), 403(b), or 457(b) of the Code and certain contributions described in Section 414(h)(2) of the Code that are picked up by the employing unit and treated as employer contributions. Effective for plan years beginning on and after January 1, 2001, compensation shall also include any amount that is not included in the participant’s taxable gross income pursuant to Section 132(f) of the Code.

For plan years beginning on or after January 1, 2008, for purposes of applying the maximum benefit limitations under this Section 4.36.402(A), compensation shall also include compensation paid by the later of 2½ months after an employee’s severance from employment with the Employer or the end of the plan year that includes the date of the employee’s severance from employment, if, absent a severance from employment, such payment would have been paid to the employee while the employee continued in employment with the Employer, and is regular compensation for services during the employee’s regular working hours, compensation for services outside the employee’s regular working hours (such as overtime or shift differential), commissions, bonuses or other similar compensation. In addition, effective for plan years beginning on an after January 1, 2008, compensation may not exceed the amount described in Code section 401(a)(17).

For plan years beginning after December 31, 2008, the plan will treat Differential Wage Payments as Compensation for all Plan contributions and benefit purposes. For purposes of this Section 4.36.402(A).D, “Differential Wage Payments” means any payment that is (i) made by the Employer to an individual with respect to any period during which they are performing service in the uniformed services (as defined in chapter 43 of title 38, United States Code) while on active duty for a period more than 30 days; and (ii) represents all or a portion of the wages the individual would have received from the Employer if they were performing services for the Employer.

A participant’s compensation for any limitation year is the compensation actually paid or includable in gross income during such year. (Ord. 7583-NS §§ 2, 3, 2017; Ord. 6747-NS § 1, 2003)

The trustee shall value the trust at least once per year at the end of each plan year. The valuation shall be made in accordance with all applicable laws. (Ord. 6747-NS § 1, 2003)

The value of each participant’s account shall be equal to:

A. All contributions made to the participant’s account, adjusted for;

B. Earnings and net investment gain or loss, minus;

C. Any amounts withdrawn in accordance with the plan; and

D. Expenses, if any, chargeable to the account. (Ord. 6747-NS § 1, 2003)

A participant’s account balance shall be at all times fully vested and non-forfeitable. (Ord. 6747-NS § 1, 2003)

Loans to participants are not permitted. (Ord. 6747-NS § 1, 2003)

Each participant in the SRIP I Plan may elect to transfer their account to the City of Berkeley Supplemental Retirement and Income Plan II (SRIP II). It is only permissible to move from SRIP I to SRIP II. The total balance of the participant’s account must be transferred. A SRIP I participant may elect to make this move anytime after October 1, 1993. The move will become effective and irrevocable when the designated forms are signed by the plan participant. (Ord. 6747-NS § 1, 2003)

Subject to the committee’s powers and duties under the plan, participants shall direct their accounts. The committee or its authorized agent(s) shall designate the time and manner of the selection and the specified investment options available to participants.

Notwithstanding the foregoing or any other provision of this plan, the committee determines that such action is necessary to fulfill its fiduciary duties. (Ord. 6747-NS § 1, 2003)