Los Angeles County Municipal Code Part 7 Distributions and Withdrawals

A.

A Participant or Beneficiary shall only be paid vested benefits under the Plan as provided in this and the following sections of this part. A Participant or Beneficiary who is eligible to receive a distribution under the Plan shall submit an application for benefits to the Administrative Committee, furnishing such information as the Administrative Committee or its duly authorized agent may require. Except to the extent an in-service withdrawal is permitted under Section 5.26.300, a Participant or Beneficiary may receive a distribution only upon a bona fide termination from employment. For the purposes of this Part 7, a bona fide termination from employment means any bona fide termination of a Participant's relationship with the County as an Employee, including termination due to death, disability, or retirement. A Participant has not had a bona fide termination from employment if, at the time the Participant leaves County employment, there is a prearrangement or understanding that the Participant will be rehired or otherwise returned to service by the County.

(Ord. 2014-0017 § 17, 2014: Ord. 2004-0064 §§ 1, 2 (part), 2004.)

A.

Distributions, Withdrawals or Loans from Core Funds Generally. Except as provided in subsection B. of this section, all Distributions, Withdrawals or Loans must be made from amounts allocated to Core Funds. If the Participant has allocated an insufficient amount to Core Funds for a requested Distribution, Withdrawal, or Loan, the Participant must transfer sufficient amounts from the Personal Brokerage Account Window to Core Funds to enable the requested Distribution, Withdrawal or Loan. The Administrative Committee may reallocate the funds in a Participant's Account from the Personal Brokerage Account Window to Core Funds if such action is necessary for the administration of the plan.

B.

Notwithstanding subsection A. of this section, a Participant or Beneficiary may request an in-kind distribution of securities held through the Personal Brokerage Account Window subject to the following requirements: (1) the Participant's Account must be 100% vested, (2) the Participant or Beneficiary must be entitled to receive and must request a full distribution of the Account from both the Core Funds and the Personal Brokerage Account Window, and (3) the in-kind distribution must be made in the form of a direct rollover to an "eligible retirement plan" as authorized in section 5.26.610 and the "eligible retirement plan" must accept the in-kind rollover.

(Ord. 2009-0040 § 11, 2009: Ord. 2008-0071 § 7, 2008.)

Any amount credited to a Participant's Tax Deferred Contributions Account, Catch-Up Contributions Account (if any), After- Tax Contributions Account, Termination Pay Contribution Account and Rollover Contributions Account shall be nonforfeitable and fully vested. Any amount credited to a Participant's Matching Contributions Account shall vest and become nonforfeitable at the rate of 20 percent for each Year of Service completed by such Participant.

(Ord. 2004-0064 §§ 1, 2 (part), 2004.)

A.

Notwithstanding the provisions of Section 5.26.250, the entire Account of a Participant whose employment with the County terminates after he is age 70 or qualified for a service retirement benefit under the County Employees Retirement Law of 1937, as amended, if earlier, or whose employment with the county terminates because of Disability, shall be nonforfeitable and fully vested. Such Account shall be paid to the Participant or his Beneficiary, in cash or in kind to the extent permitted under section 5.26.245B., in accordance with one of the following methods as the Participant determines:

A lump-sum payment; or

Substantially equal monthly, quarterly, semi-annually or annual installments not extending for a period that is longer than the life of the Participant or the lives of the Participant and his or her designated Beneficiary and the last survivor of them; or

Consecutive periodic payments for the life of the Participant or for the lives of the Participant and his or her designated Beneficiary and the last survivor of them; or

A combination of the methods of payment described in subsections A1, 2 and 3 of this section.

B.

All distributions hereunder shall be made on or begun as soon as administratively practicable after the Participant's application is filed pursuant to Section 5.26.240 and approved by the Administrative Committee. A Participant's election to begin distribution and selection of a payment method shall be irrevocable except as provided in subsection C. For purposes of a distribution, the date that such Participant's interest in an Investment Fund is liquidated or redeemed, partially or in full, to satisfy the distribution application shall be the applicable Valuation Date.

C.

Participants whose distributions under this Plan have already begun or who submitted an application to begin distributions may thereafter elect to change their previous payment elections; any such election shall be deemed to be made at the time that the benefit election becomes effective. The election shall be made on a form approved by the Administrative Committee and shall be subject to minimum distribution requirements of Code Section 401(a)(9) and the regulations thereunder. This subsection C shall apply to Beneficiaries who are receiving distributions under the Plan pursuant to Section 5.26.270. This subsection C shall not apply to Participants and Beneficiaries whose benefits under the Plan are provided through an annuity purchased from an insurance carrier.

D.

Distributions will begin in accordance with Code Section 401(a)(9) and the regulations thereunder and Section 5.26.290 of the Plan. Such provisions shall override any inconsistent distribution option.

(Ord. 2018-0031 § 7, 2018; Ord. 2009-0040 § 12, 2009; Ord. 2004-0064 §§ 1, 2 (part), 2004.)

A.

Notwithstanding the provisions of Section 5.26.250, if a Participant dies prior to terminating his employment with the County, his entire Account shall be nonforfeitable and fully vested. In addition, effective January 1, 2007, a Participant's entire Account shall be nonforfeitable and fully vested if the Participant dies while performing "qualified military service," as defined in Code section 414(u)(5). Such Account shall be paid by the Trustee to the Participant's Beneficiary after the Trustee is notified by the Administrative Committee of the Participant's death.

B.

A Participant shall have the right to designate that after his death his Account shall be paid to or for his Beneficiary in accordance with one of the methods set forth in subsection A of Section 5.26.260. Any designation by a Participant of the

method of payment of death benefits hereunder may be made, changed or revoked by the Participant in writing in a form prescribed by the Administrative Committee and filed with the Administrative Committee prior to the Participant's death.

C.

If a Participant does not expressly designate the method of distribution of his Account, or if such designation is for any reason not effective, such Account shall be paid to or for the Beneficiary in accordance with one of the methods set forth in subsection A of Section 5.26.260 as such Beneficiary, in his or her discretion, shall determine and designate to the Administrative Committee.

D.

If distributions have not already begun at the time of the Participant's death, and to the extent permitted under section 5.26.290, a Beneficiary may elect to defer distribution of the Participant's Account and direct the investment of such Account as though he was the Participant in accordance with section 5.26.200; provided, however, that if a portion of the Participant's Account is invested through the Personal Brokerage Account Window, the Beneficiary will be required to enter his own contract with the Broker to open a brokerage account and retain any investments held in the Account through the Personal Brokerage Account Window.

(Ord. 2014-0017 § 18, 2014; Ord. 2009-0040 § 13, 2009; Ord. 2004-0064 §§ 1, 2 (part), 2004.)

A.

A Participant whose employment with the County terminates for any reason other than the reasons specified in Section 5.26.260 or 5.26.270 shall receive his entire Tax Deferred Contributions Account, Catch-Up Contributions Account (if any), After-Tax Contributions Account (if any), Termination Pay Contribution Account (if any), Rollover Contributions Account (if any) and the portion of his Matching Contributions Account in which he is vested in accordance with Section 5.26.250. The portion of his Matching Contributions Account which is not so vested shall be immediately forfeited. If a Participant forfeits a portion of his Account and he is later rehired by the County, his employment with the County or participation in the Plan after such rehire shall have no effect on the amount of the forfeiture. If such a rehired Participant subsequently becomes party to another Compensation Deferral Agreement, any Matching Contributions thereafter made by the County and any earnings and investment gains or losses allocable thereto shall be credited to a separate Matching Contributions Account maintained for such Participant and shall vest as provided herein without regard to any Year of Service prior to his rehire.

B.

Amounts distributed pursuant to subsection A of this Section 5.26.280 shall be paid in accordance with one of the methods set forth in subsection A of Section 5.26.260 as selected by the Participant.

C.

A Participant has not terminated employment with the "County" for the purposes of this Section 5.26.280 when he or she moves to another employer whose Eligible Employees also participate in the Plan.

(Ord. 2004-0064 §§ 1, 2 (part), 2004.)

A.

Prior Plan Provision. With respect to distributions under the Plan made for calendar years beginning prior to January 1, 2003, the following provisions will apply. These prior Plan provisions are preserved in accordance with Revenue Procedure 2002- 29.

Notwithstanding any other provision hereof to the contrary, distributions under the Plan shall be made in accordance with Code Section 401(a)(9) (including Section 401(a)(9)(G)) and the Treasury Regulations promulgated thereunder (including Section 1.401(a)(9)-2); provided, however, that such provisions shall override the other distribution provisions of the Plan only to the extent that such other Plan provisions provide for a distribution that is less rapid or of a lesser amount than required under such provisions of the Code and Regulations. Nothing contained in this Section 2.26.290 shall be construed as providing an optional form of payment that is not available under the other distribution provisions of Sections 5.26.260—280.

The entire interest of each Participant under the Plan:

a.

Either will be distributed to him not later than his taxable year in which he attains age 70 1/2 or in his taxable year in which he retires from County service, whichever is the later (his "Required Beginning Date"); or

b.

Will be distributed, commencing not later than his Required Beginning Date, (i) in accordance with regulations prescribed by the Secretary of the Treasury, over the life of such Participant or over the lives of such Participant and his designated Beneficiary, or (ii) in accordance with such regulations, over a period not extending beyond the life expectancy of such Participant or the life expectancy of such Participant and his designated Beneficiary.

Upon the death of a Participant, the following distribution provisions will apply to limit the Beneficiary's ability to delay distributions.

a.

If the Participant dies after distribution of his benefit has begun, the remaining portion of his benefit will continue to be distributed at least as rapidly as under the method of distribution being used prior to the Participant's death.

b.

If the Participant dies before distribution of his benefit has begun, his entire benefit will be distributed no later than five years after his death, unless an individual who is a designated Beneficiary elects to receive distributions in substantially equal installments over the Beneficiary's life or over a period not extending beyond the life expectancy of the Beneficiary (and, if the Beneficiary is not the Participant's spouse, in accordance with the distribution options available under Sections 5.26.260 and 5.26.270) beginning no later than December 31 of the calendar year following the calendar year in which the Participant died. If the designated Beneficiary is the Participant's surviving spouse, the date distributions are required to begin is the later of December 31 of the calendar year following the calendar year in which the Participant died or December 31 of the calendar year in which such Participant would have attained age 70-1/2. If the spouse dies before such payments begin, subsequent distributions will be made as if the spouse had been the Participant.

c.

Generally, distributions will be treated as having begun to the Participant for the purposes of this Section 5.26.290 on the employee's Required Beginning Date, even though payments may actually have been made before that date; provided, however, that if distributions irrevocably (except for acceleration) commence to an employee under an annuity contract, distributions will be considered to have begun on the actual commencement date.

The Participant (or the Participant's spouse if the Participant dies before distributions have begun) may elect not to recalculate annually the life expectancy of the Participant and the Participant's spouse (other than in the case of a life annuity) in accordance with Code Section 401(a)(9)(D) and the Regulations thereunder. Such election must be made prior to

the time of the first required distribution under Code Section 401(a)(9). If the Participant (or spouse if applicable) fails to make such election, life expectancies will be recalculated annually in accordance with the Regulations.

2001 Proposed Regulations. With respect to distributions under the Plan made for calendar years beginning on or after January 1, 2001, the Plan will apply the minimum distribution requirements of Section 401(a)(9) of the Internal Revenue Code in accordance with the regulations under Section 401(a)(9) that were proposed on January 17, 2001, notwithstanding any provision of the Plan to the contrary. This amendment shall continue in effect until the end of the last calendar year beginning before the effective date of final regulations under Section 401(a)(9) or such other date as may be specified in guidance published by the Internal Revenue Service.

B.

Generally. The provisions of Section 5.26.290B-G will apply for the purposes of determining required minimum distributions for Distribution Calendar Years beginning January 1, 2003. The requirements of Section 5.26.290B-G will take precedence over any inconsistent provisions of the Plan. Notwithstanding any provision of the Plan to the contrary, all distributions required under Sections 5.26.260 and 5.26.270 of this Plan will be determined and made in accordance with the Treasury Regulations under Section 401(a)(9) of the Code. The only permissible distribution options under this Plan are a lump sum distribution; equal monthly, quarterly or annual installments; consecutive periodic payments for the life of the Participant or for the lives of the Participant and his or her spouse to the extent permitted in Section 5.26.260; or minimum monthly distributions calculated in accordance with the rules provided in Section 5.26.290B-G.

C.

Definitions. For the purposes of Section 5.26.290B—G, the following terms, when used with initial capital letters, shall have the following respective meanings:

"Designated Beneficiary": The person who is designated as the Beneficiary as defined in Section 5.26.020.7 of the Plan and is the designated beneficiary under Section 401(a)(9) of the Code and Section 1.401(a)(9)-4 of the Treasury Regulations.

"Distribution Calendar Year": A calendar year for which a minimum distribution is required. For distributions beginning before the Participant's death, the first Distribution Calendar Year is the calendar year immediately preceding the calendar year which contains the Participant's Required Beginning Date. For distributions beginning after the Participant's death, the first Distribution Calendar Year is the calendar year in which distributions are required to begin under Section 5.26.290D.2 of the Plan. The required minimum distribution for the Participant's first Distribution Calendar Year will be made on or before the Participant's Required Beginning Date. The required minimum distribution for other Distribution Calendar Years, including the required minimum distribution for the Distribution Calendar Year in which the Member's Required Beginning Date occurs, will be made on or before December 31 of that Distribution Calendar Year.

"Life Expectancy": Life expectancy as computed by use of the Single Life Table in Section 1.401(a)(9)-9 of the Treasury Regulations.

"Participant's Account Balance": The Account balance as of the last Valuation Date in the calendar year immediately preceding the Distribution Calendar Year (the "Valuation Calendar Year") increased by the amount of any contributions made and allocated or forfeitures allocated to the Account balance as of dates in the Valuation Calendar Year after the Valuation Date and decreased by distributions made in the Valuation Calendar Year after the Valuation Date. The Account balance for

the Valuation Calendar Year includes any amounts rolled over or transferred to the Plan either in the Valuation Calendar Year or in the Distribution Calendar Year if distributed or transferred in the Valuation Calendar Year.

"Required Beginning Date": The applicable date specified in subsection D below.

D.

Time of Distribution.

The Participant's entire interest will be distributed, or begin to be distributed no later than the Participant's Required Beginning Date. Except as described in subsection D.2 below, the Required Beginning Date of any Participant shall be the April 1 of the calendar year following the later of (a) the calendar year he terminates employment or (b) the calendar year he attains age 70 1/2.

If the Participant dies before distributions begin, the Participant's entire interest will be distributed, or begin to be distributed, no later than as follows:

(a)

If the Participant's surviving spouse is the Participant's sole Designated Beneficiary, then, unless the election described in subsection D.4 below is made, distributions to the surviving spouse will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died, or by December 31 of the calendar year in which the Participant would have attained age 70 1/2, if later.

(b)

If the Participant's surviving spouse is not the Participant's sole Designated Beneficiary, then, unless the election described in subsection D.4 below is made, distributions to the Designated Beneficiary will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died.

(c)

If there is no Designated Beneficiary as of September 30 of the year following the year of the Participant's death, the Participant's entire interest will be distributed by December 31 of the calendar year containing the fifth anniversary of the Participant's death.

(d)

If the Participant's surviving spouse is the Participant's sole Designated Beneficiary and the surviving spouse dies after the Participant but before distributions to the surviving spouse begin, this subsection D.2, other than subsection D.2(a), will apply as if the surviving spouse were the Participant.

For purposes of Section 5.26.290B-G, unless subsection D.2(d) applies, distributions are considered to begin on the Participant's Required Beginning Date. If subsection D.2(d) applies, distributions are considered to begin on the date distributions are required to begin to the surviving spouse under subsection D.2(a). If distributions under an annuity purchased from an insurance company irrevocably commence to the Participant before the Participant's Required Beginning Date (or to the Participant's surviving spouse before the date distributions are required to begin to the surviving spouse under subsection D.2(d), the date distributions are considered to begin is the date distributions actually commence.

Notwithstanding the foregoing, if a Participant dies before distributions begin and there is a Designated Beneficiary, distribution to the Designated Beneficiary is not required to begin by the Required Beginning Date specified above if the Participant or the Beneficiary elects, on an individual basis, that the Participant's entire interest will be distributed to the Designated Beneficiary by December 31 of the calendar year containing the fifth anniversary of the Participant's death; provided, however, that if the Participant's surviving spouse is the Participant's sole Designated Beneficiary and the surviving spouse dies after the Participant but before distributions to either the Participant or the surviving spouse begin, this election will apply as if the surviving spouse were the Participant. The election provided in this subsection D.4 must be made no later than the earlier of September 30 of the calendar year in which distribution would be required to begin, or by September 30 of the calendar year which contains the fifth anniversary of the Participant's (or, if applicable, surviving spouse's) death.

E.

Required Minimum Distributions During Participant's Lifetime.

During the Participant's lifetime, the minimum amount that will be distributed for each Distribution Calendar Year is the lesser of:

(a)

The quotient obtained by dividing the Participant's Account Balance by the distribution period in the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9 of the Treasury Regulations, using the Participant's age as of the Participant's birthday in the Distribution Calendar Year; or

(b)

If the Participant's sole Designated Beneficiary for the Distribution Calendar Year is the Participant's spouse, the quotient obtained by dividing the Participant's Account Balance by the number in the Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9 of the Treasury Regulations, using the Participant's and spouse's attained ages as of the Participant's and spouse's birthdays in the Distribution Calendar Year.

Required minimum distributions will be determined under this subsection E beginning with the first Distribution Calendar Year and up to and including the Distribution Calendar Year that includes the Participant's date of death.

If the Participant's interest is distributed in the form of an annuity purchased from an insurance company, distributions thereunder will be made in accordance with the requirements of Code Section 401(a)(9) and the Treasury Regulations.

F.

Required Minimum Distributions if Participant Dies After Distributions Begin.

Participant Survived by Designated Beneficiary. If the Participant dies on or after the date distributions begin and there is a Designated Beneficiary, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant's death is the quotient obtained by dividing the Participant's Account Balance by the longer of the remaining Life Expectancy of the Participant or the remaining Life Expectancy of the Participant's Designated Beneficiary, determined as follows:

(a)

The Participant's remaining Life Expectancy is calculated using the age of the Participant in the year of death, reduced by one for each subsequent year.

(b)

If the Participant's surviving spouse is the Participant's sole Designated Beneficiary, the remaining Life Expectancy of the surviving spouse is calculated for each Distribution Calendar Year after the year of the Participant's death using the surviving spouse's age as of the spouse's birthday in that year. For Distribution Calendar Years after the year of the surviving spouse's death, the remaining Life Expectancy of the surviving spouse is calculated using the age of the surviving spouse as of the spouse's birthday in the calendar year of the spouse's death, reduced by one for each subsequent calendar year.

(c)

If the Participant's surviving spouse is not the Participant's sole Designated Beneficiary, the Designated Beneficiary's remaining Life Expectancy is calculated using the age of the Beneficiary in the year following the year of the Participant's death, reduced by one for each subsequent year.

No Designated Beneficiary. If the Participant dies on or after the date distributions begin and there is no Designated Beneficiary (for example, if pursuant to the Plan, the Beneficiary is the Participant's estate) as of September 30 of the year after the year of the Participant's death, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant's death is the quotient obtained by dividing the Participant's Account Balance by the Participant's remaining Life Expectancy calculated using the age of the Participant in the year of death, reduced by one for each subsequent year.

If the Participant's interest is distributed in the form of an annuity purchased from an insurance company, distributions thereunder will be made in accordance with the requirements of Code Section 401(a)(9) and the Treasury Regulations.

G.

Death Before Date Distributions Begin:

If the Participant dies before the date distributions begin and there is a Designated Beneficiary, then, unless the election described in subsection D.4 above is made, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant's death is the quotient obtained by dividing the Participant's Account Balance by the remaining Life Expectancy of the Participant's Designated Beneficiary, determined as provided in subsection F.1, above.

If the Participant dies before the date distributions begin and there is no Designated Beneficiary as of September 30 of the year following the year of the Participant's death, distribution of the Participant's entire interest will be completed by December 31 of the calendar year containing the fifth anniversary of the Participant's death.

If the Participant dies before the date distributions begin, the Participant's surviving spouse is the Participant's sole Designated Beneficiary, and the surviving spouse dies before distributions are required to begin to the surviving spouse under subsection D.2(a), Section 5.26.290B-G will apply as if the surviving spouse were the Participant.

If the Participant's interest is distributed in the form of an annuity purchased from an insurance company, distributions thereunder will be made in accordance with the requirements of Code Section 401(a)(9) and the Treasury Regulations.

H.

Notwithstanding the other subsections of this Section 5.26.290, a Participant or Beneficiary who would have been required to receive a required minimum distribution (RMD) for 2009 but for the enactment of Code section 401(a)(9)(H) of the Code (2009 RMD), and who would have satisfied that requirement by receiving distributions that are (1) equal to the 2009 RMD or (2) one or more payments in a series of substantially equal distributions (that include the 2009 RMD) made at least annually and expected to last for the life (or life expectancy) of the Participant, the joint lives (or joint life expectancy) of the Participant and the Participant's designated Beneficiary, or for a period of at least 10 years, will not receive those distributions for 2009 unless the Participant or Beneficiary chooses to receive such distributions. Participants and beneficiaries described in the preceding sentence will be given the opportunity to elect to receive the distributions described in the preceding sentence. For the purposes of this subsection H, any election on file to receive automated RMDs, even if received before 2009, is treated as an election to receive those distributions in 2009 except to the extent such election is revoked in accordance with a procedure established by the TPA. Notwithstanding the foregoing, a direct rollover will be offered only for distributions that would be Eligible Rollover Distributions without regard to Code section 401(a)(9)(H).

(Ord. 2018-0031 § 8, 2018; Ord. 2014-0017 § 19, 2014; Ord. 2004-0064 §§ 1, 2 (part), 2004.)

Upon not less than 30 days' prior written notice filed with the Administrative Committee, effective as of the Entry Date following notification of the Trustee and Investment Manager by the Administrative Committee, a Participant who is an Employee may withdraw in cash all or a part of his Account balance as of the immediately preceding Valuation Date as provided and in the order set forth below. Except in cases of Hardship, a Participant may make only two withdrawals pursuant to this Section 5.26.300 per Plan Year.

A.

A Participant may withdraw all or a part of his After-Tax Contributions Account (if any).

B.

A Participant may withdraw all or a part of his Rollover Contributions Account (if any).

C.

A Participant may withdraw all or a part of his Matching Contributions Account in which he has a vested interest but a Participant may not make a withdrawal pursuant to this subsection unless he is either credited with at least 10 Years of Service or such withdrawal is made due to Hardship.

D.

A Participant who has withdrawn his entire After-Tax Contributions Account (if any), his entire Rollover Contributions Account (if any), and his entire Matching Contributions Account (to the extent vested) may in addition withdraw all or a part of his Tax Deferred Contributions Account (excluding any earnings credited to such Account for periods on or after January 1, 1989, and before January 1, 2020), provided that the Participant has attained 59 1/2 or demonstrated to the Administrative Committee that he is suffering from Hardship. A withdrawal shall not be permitted for Hardship unless such withdrawal is on account of an immediate and heavy financial need of the Participant and is necessary to satisfy such financial need.

Effective as of January 1, 2006, the determination of whether a Participant has an immediate and heavy financial need shall be made by the Administrative Committee on the basis of all relevant facts and circumstances. Nevertheless, a withdrawal shall be deemed to be made on account of an immediate and heavy financial need of a Participant if the withdrawal is on account of:

a.

Expenses for (or necessary to obtain) medical care that would be deductible under Section 213(d) of the Code (determined without regard to whether the expenses exceed 7.5% of adjusted gross income);

b.

The purchase (excluding mortgage payments) of a principal residence of the Participant;

c.

The payment of tuition for the next semester or quarter of post-secondary education for the Participant, the Participant's spouse, the Participant's children, or the Participant's dependents (as defined in section 152 of the Code, and for taxable years beginning on or after January 1, 2005, without regard to section 152(b)(1), (b)(2) or (d)(1)(B) of the Code);

d.

The need to prevent the eviction of the Participant from his principal residence or the foreclosure on the mortgage of the Participant's principal residence;

e.

On and after January 1, 2007, payment for burial or funeral expenses for the Participant's deceased parent, spouse, children or dependents (as defined in section 152 of the Code but without regard to subsection 152(d)(1)(B));

f.

On and after January 1, 2007, expenses for the repair of damage to the Participant's principal residence that would qualify for the casualty deduction under section 165 of the Code (determined without regard either to whether the loss exceeds 10% of adjusted gross income or, effective January 1, 2020, to Code Section165(h)(5)).

g.

Effective January 1, 2020, expenses and losses (including loss of income) incurred by the Participant on account of a disaster declared by the Federal Emergency Management Agency (FEMA) under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, Pub. L. 101-707, provided the Participant's principal residence or principal place of employment at the time of the disaster was located in an area designated by FEMA for individual assistance with respect to that disaster; or

h.

Any other financial need which the Commissioner of Internal Revenue, through the publication of revenue rulings, notices, and other documents of general applicability, may from time to time designate as a deemed immediate and heavy financial need as provided in Section 1.401(k)-1(d)(2)(iii)(C) of the Treasury Regulations.

Effective as of January 1, 2006, a withdrawal shall not be treated as necessary to satisfy an immediate and heavy financial need of a Participant to the extent the amount of the withdrawal exceeds the amount required to relieve the financial need or to the extent such need may be satisfied from other resources that are reasonably available to the Participant. The determination of whether the amount of a withdrawal is necessary to satisfy an immediate and heavy financial need shall be made by the Administrative Committee on the basis of all relevant facts and circumstances. Nevertheless, the amount of a withdrawal shall be deemed to be necessary to satisfy an immediate and heavy financial need of a Participant if: (a) the amount of the distribution is not in excess of the amount of the immediate and heavy financial need; (b) the Participant has obtained all distributions (other than Hardship distributions) and nontaxable (at the time of the loan) loans available under the terms of this Plan or any other plans of deferred compensation maintained by the County; and (c) for periods before January 1, 2020, the Participant irrevocably elects to suspend all elective contributions and employee contributions under this Plan (e.g., After-Tax Contributions and Tax Deferred Contributions) and all other plans of deferred compensation maintained by the County from the date on which the withdrawal is made until the earlier of: (a) the close of the six-calendar-month period that began on the first day of the month following the date on which the withdrawal is made; or (b) January 1, 2020. For the purposes of this subsection D2, the term "other plans of deferred compensation" include, without limitation, all qualified and non-qualified deferred compensation plans and any cash or deferred arrangements that are part of a cafeteria plan, except that it does not include the mandatory employee contribution component of a defined benefit plan or welfare plan. For the

purposes of this subsection D2 the County includes the County and all other employers which are required to be treated as a single "employer" under Treasury Regulation section 1.401(k)-6. A Participant whose elective and/or employee contributions to this Plan and/or any other deferred compensation plan of the County were suspended prior to January 1, 2020, by reason of having received a withdrawal under this section, may elect to restart such contributions at any time on or after January 1, 2020, in accordance with applicable procedures under the terms of this Plan or other County plan, as applicable.

Distributions may be made for expenses described in subsections 1.a., c. or e. (relating to medical, tuition, and funeral expenses, respectively) for a primary Beneficiary under the Plan as if that Beneficiary were the Participant's spouse or dependent.

(Ord. 2020-0023 § 3, 2020; Ord. 2014-0017 § 20, 2014; Ord. 2008-0004 § 15, 2008; Ord. 2007-0001 § 5, 2007; Ord. 2004- 0064 §§ 1, 2 (part), 2004.)

A.

Upon application by a Participant, but subject to such uniform and nondiscriminatory rules as the Administrative Committee may establish and to the provisions of this section, effective January 1, 1986, the Administrative Committee may in its discretion direct the Trustee to make a loan or loans to a Participant from his separate account in the Participant Loan Fund in an amount not exceeding the excess of:

The lesser of:

a.

$50,000.00, reduced by the excess (if any) of:

(1)

The highest outstanding balance of loans to such Participant from the Plan during the one-year period ending on the day before the date on which such new loan was made,

(2)

Over the outstanding balance of loans to such Participant from the Plan on the date on which such new loan was made, or

b.

50 percent of the vested portion of the Participant's Account balance (not including amounts attributable to a Participant's After-Tax Contributions Account); or

c.

100 percent of the vested portion of the Participant's Account balance allocated to Core Funds.

Over the outstanding balance of any other loan or loans from the Plan to the Participant; provided, however, that if 50 percent of the vested portion of the Participant's Account balance (not including any amounts attributable to a Participant's After-Tax Contributions Account) is less than $10,000.00, the amount in subsection A.1.b of this section shall be the lesser of $10,000.00 or 80 percent of the vested portion of the Participant's Account balance. The minimum loan that may be made from the Plan is $2,000.00 (or such other amount determined by the Administrative Committee). All loans hereunder shall be

subject to such loan processing fees charged by the Trustee and Investment Manager as are approved by the Administrative Committee, which fees shall be paid by borrowing Participants.

B.

As soon as practicable after the receipt of all necessary information and directions from the Administrative Committee to make a loan and prior to making any loan pursuant to subsection A of this section, but in no event later than 30 days after the applicable Valuation Date, the Trustee or Investment Manager shall transfer, in accordance with procedures determined by the Administrative Committee, to the Participant Loan Fund from the assets invested in other Investment Funds allocated to the Account of each borrowing Participant an amount equal to the amount of such Participant's loan, which investment shall be allocated to such Participant's Account; provided, however, that no amount from the Participant's After-Tax Contributions Account shall be transferred to the Participant Loan Fund for the purpose of making a loan to the Participant. The Participant Loan Fund shall be invested solely in loans to Participants made pursuant to this section and shall at all times be at least equal to the total amount of such loans. All interest and principal payments made by such Participant shall be credited to the separate account within the Participant Loan Fund of each Participant who borrows money from the Plan. Except as otherwise provided by the Administrative Committee, as of each Valuation Date all cash in the Participant Loan Fund shall be transferred to the other Investment Funds in accordance with each borrowing Participant's investment choice under Section 5.26.200.

C.

Loans made pursuant to subsection A of this section:

Shall be secured by the portion of the Participant's Account attributable to vested Matching Contributions and any or all of the following:

a.

The portion of the Participant's Account attributable to Tax Deferred Contributions,

b.

The portion of the Participant's Account attributable to Rollover Contributions,

c.

Such other collateral as the Administrative Committee may require or permit;

Shall be available to all Participants on a reasonably equivalent basis that shall not result in discrimination in favor of Employees who are officers or highly compensated within the meaning of Code section 401; and

Shall be evidenced by a promissory note executed by the Participant which provides for:

a.

A reasonable rate of interest determined by the Administrative Committee, and

b.

Repayment through payroll deduction or via check while a Participant is on a leave of absence without sufficient pay (except to the extent loan repayments are suspended in accordance with the loan policy and applicable law):

(1)

Within a specified period of time, which shall not extend beyond five years from the time the loan is made unless the loan proceeds are used to acquire a dwelling, which within a reasonable time is to be used as a principal residence (as determined at the time the loan is made) of the Participant, in which case the promissory note shall provide for repayment within 15 years of the time the loan is made, unless otherwise provided by the Administrative Committee at the time the loan is made, and

(2)

In substantially equal payments, at least quarterly, over the term of the loan, and

(3)

Upon such other terms and conditions as the Administrative Committee shall determine.

Shall be administered in accordance with a loan policy adopted by the Administrative Committee.

Notwithstanding any other provision of the Plan, including Section 5.26.460, such loan shall be a first lien against the portion of the Participant's Account by which it is secured and any amount of principal or interest due and unpaid thereof shall be deducted insofar as possible from the portion of such Account by which it is secured before the payment of any portion thereof to the Participant or his Beneficiary. A loan shall continue to be repaid pursuant to the terms of the promissory note, even after the loan has defaulted and been reported as a deemed distribution on Form 1099-R, unless and until the loan has been repaid in full, including through offset either: (1) at the time the Participant or Beneficiary requests a distribution, or (2) to the extent provided in the promissory note and loan policy, upon the Participant's death or Separation from Employment.

D.

Notwithstanding the foregoing provisions of this section, loans made to Participants under the Plan shall be due and payable upon the Participant's termination of employment with the County, whether by death, retirement or otherwise.

(Ord. 2014-0017 § 21, 2014; Ord. 2008-0071 § 8, 2008; Ord. 2004-0064 §§ 1, 2 (part), 2004.)

Unless the Plan provides for a distribution from a specific Account, distributions shall be made first from a Participant's After- Tax Contributions Account before any other Account. Moreover, distributions (including withdrawals) shall be made from the applicable portion of a Participant's Account invested in the Investment Funds on a pro rata basis from each Investment Fund, unless a different order of distribution is directed by the Participant. Each Participant by written notice (in form acceptable to the Administrative Committee) signed by the Participant and filed with the Administrative Committee may direct the order in which distributions are to be made if other than on a pro rata basis.

(Ord. 2004-0064 §§ 1, 2 (part), 2004.)

Notwithstanding the foregoing provisions of this Part 7, for distributions made before July 1, 2020, if a Participant's vested Account balance (determined without regard to a Participant's Rollover Contributions Account) does not exceed $5,000.00 at the time the Participant or Beneficiary requests a distribution, such Account shall be paid to the Participant or Beneficiary only in the form of a lump sum.

(Ord. 2020-0023 § 4, 2020; Ord. 2005-0037 § 7, 2005: Ord. 2004-0064 §§ 1, 2 (part), 2004.)

If the Participant or his or her Beneficiary cannot be located within four years of the date the Participant's interest under the Plan is first payable, the entire balance in his or her Account shall be forfeited; provided, however, that the amount so forfeited shall be reinstated as of the date of the subsequent filing of an application for benefits under the Plan, and payment of the lump sum benefit shall occur no later than 60 days after such application is approved by the Administrative Committee.

(Ord. 2004-0064 §§ 1, 2 (part), 2004.)

The amount of Participant's Account which is forfeited for a Plan Year in accordance with Sections 5.26.120, 5.26.280 and 5.26.335, plus any amount that is transferred to the Plan from the forfeiture suspense account in the Deferred Earnings Plan established under Section 5.23.070L of the Los Angeles County Code upon the merger of the Deferred Earnings Plan with this Plan, shall be placed in one or more forfeiture accounts held in the Trust Fund and applied first, restore the accounts of lost Participants who have filed an application for benefits that has been approved by the Administrative Committee, if any, and second, to offset future Matching Contributions to be made by the County in accordance with Section 5.26.140. Earnings on the forfeiture accounts held in the Trust Fund shall be used to reduce administrative expenses of the Plan in accordance with Section 5.26.420.

(Ord. 2008-0022 § 8, 2008: Ord. 2004-0064 §§ 1, 2 (part), 2004.)