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RESOLUTION NO. 2023 - xxx
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FONTANA,
CALIFORNIA, FOR EMPLOYER PICK -UP OF CERTAIN EMPLOYEE
CONTRIBUTIONS TO THE CITY’S PTS -OBRA PLAN PURSUANT TO
INTERNAL REVENUE CODE SECTION 414(h)(2)
WHEREAS, the City currently maintains a Social Security replacement plan for its eligible part -time and seasonal employees (the “PTS -OBRA Plan”) ; and
WHEREAS, the City Council, pursuant to its Resolution No. 2022 – 127, previously authorized the migration of recordke eping services for the PTS -OBRA Plan from Public Agency Retirement Services to Bencor; and
WHEREAS, in connection with this migration it will be necessary to amend and restate the PTS -OBRA Plan onto a new plan document supported and provided by Bencor; and
WHEREAS, the Bencor arrangement only supports pre -tax employee contributions (i.e., employee contributions that have been picked-up pursuant to Internal Revenue Code section 414(h)(2)); and
WHEREAS, the pick-up of employee mandatory contributions to the PTS -OBRA Plan will result in a modest savings of taxes for participants and will have no negative fiscal impact upon the City.
NOW, T HEREFORE, BE IT RE SOLVED by the C ity Council of the City of Fontana, California, as follows:
Section 1. Pursuant to IRC Section 414(h)(2), the City Council hereby elects to implement an employer pick -up of mandatory employee contributions to the City’s PTS-OBRA Plan.
Section 2. Picked up contributions, although designated as employee contributions, will be picked up on a pre -tax basis in lieu of employee contributions so that such contributions are treated for income tax purpose as employer contributions .
Section 3. Employees sh all not have the option of choosing to receive the picked up contribution amounts directly instead of having them paid by the City to the PTS-OBRA Plan.
RESOLVED, FURTHER, that the appropriate members of the City’s staff are hereby authorized and directed to take all reasonable and necessary actions, including 16498.00411\40897208.1
the execution of a new Bencor -provided PTS -OBRA plan document and additional documents, to carry out and implement this resolution.
PASSED AND ADOPTED: 24th day of January, 2023.
ATTEST: CITY OF FONTANA
Germaine Key Acquanetta Warner
City Clerk Mayor
APPROVED AS TO FORM:
Ruben Duran,
City Attorney