ATTACHMENT A
RESOLUTION NO. 24-XX
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RESOLUTION NO. 24-XX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LANCASTER,
CALIFORNIA, APPROVING THE ADOPTION OF THE DEFINED BENEFIT PLAN
PLATFORM PROPOSED BY SHUSTER ADVISORY GROUP, LLC
WHEREAS, The City of Lancaster (the “City”) maintains a supplemental defined benefit retirement plan that provides retirement benefits to eligible employees upon retirement from the City (the “Plan”) with a related governmental excess benefit arrangement plan within the meaning of Code Section 415(m) for certain of those eligible employees;
WHEREAS, the Plan conforms to the applicable requirements of the Internal Revenue Code of 1986 (“IRC”) and the California Public Employees’ Pension Reform Act of 2013, each as amended;
WHEREAS, under IRC Section 401(a), benefits under the Plan must be paid from a qualified retirement trust or certain other funding vehicles as defined in IRC Section 401(f);
WHEREAS, Shuster Advisory Group, LLC (Shuster) has made available a Defined Benefit Plan platform with the Howard E. Nyhart Company, Inc. providing plan administration, Charles Schwab Trust Bank (Schwab) providing custodial services, and Shuster providing plan consulting and fiduciary investment management, and
WHEREAS, the Schwab custodial account satisfies the applicable requirements of the tax laws to be treated as a qualified trust under section 401 of the Internal Revenue Code and accordingly, under those laws, Schwab is treated as the trustee, and
WHEREAS, all qualified assets currently held in the Public Agency R etirement System 401(a) Trust are irrevocably dedicated to the funding of the PARS Retirement Enhancement Plan (REP), and
WHEREAS, all assets currently held in the City of Lancaster Excess Benefit Trust are irrevocably dedicated to the funding of the City of Lancaster Excess Benefit Plan, and
WHEREAS, the City is eligible to be a member of a qualified governmental retirement trust or certain other funding vehicles, established pursuant to the provisions of Section 501 of the Internal Code, and the California Government Code Sections 53215 through 53224 providing for pension trusts established by public agencies.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LANCASTER, AS FOLLOWS:
Section 1. Effective March 31, 2024, the City Council hereby authorizes the establishment of the Shuster Defined Benefit Plan platform for administration of the City of Lancaster Supplemental Retirement Plan and related City of Lancaster Qualified Governmental Excess Benefit Arrangement; and
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Section 2. Effective March 31,2024, the City Council hereby authorizes the termination of the City of Lancaster’s participation in the Public Agency Retirement System 401(a) Trust, all services, administration, plan documents, and investment contracts with PARS and US Bank, N.A. (“U.S. Bank”), including the services of U.S.
Bank as Trustee; and
Section 3. The City Council hereby authorizes the appointment of Nyhart to provide plan administration and the appointment of Shuster to provide plan consulting and fiduciary investment management for the City of Lancaster Supplemental Retirement Plan; and
Section 4. The City Council hereby authorizes the appointment of Schwab as successor Custodian of the City of Lancaster Supplemental Retirement Plan and Schwab custodial account is accepted as a qualified trust under section 401 of the Internal Revenue Code; and
Section 5. The City Council acknowledges that the successor custodial account satisfies the requirements of section 401 of the Internal Revenue Code and that all assets held by the custodial account shall qualify as “plan assets” that are irrevocably dedicated to the City of Lancaster Supplemental Retirement Plan;
Section 6. Effective March 31,2024, the City Council hereby authorizes the termination of the City of Lancaster’s participation in the City of Lancaster Excess Benefit Trust, all services, administration, plan documents, and investment contracts with PARS and US Bank, N.A. (“U.S. Bank”), including the services of U.S. Bank as Trustee; and
Section 7. The City Council hereby authorizes the City to provide plan administration and the appointment of Shuster to provide plan consulting and fiduciary investment management for the City of Lancaster Qualified Government Excess Benefit Arrangement; and
Section 8. The City Council hereby authorizes the appointment of Schwab as successor Custodian of the City of Lancaster Qualified Governmental Excess Benefit Arrangement and Schwab custodial account is accepted as a qualified trust under section 415 of the Internal Revenue Code; and
Section 9. The City Council hereby authorizes the liquidation to effectuate the transfer of all assets of the Supplemental Retirement Plan and related governmental excess benefit arrangement plan to Charles Schwab Trust Bank, on or around March 31, 2024 and
Section 10. Upon the complete transfer of assets, PARS is removed as trust administrator and U.S. Bank is removed as Trustee of the PARS Retirement Enhancement Plan; and
Section 11. Upon the complete transfer of assets, PARS is removed a s trust administrator and U.S. Bank is removed as Trustee of the City of Lancaster Excess Benefit Plan; and
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Section 12. The City Council hereby appoints the City Manager or his/her successor or his/her designee as the City’s Administrator for the Plans; and Section 13. The City's Administrator is hereby authorized on behalf of the City to:
(i) execute the legal documents with any modifications that the Administrator and the City Attorney deem necessary or
appropriate to reflect the intent of this resolution; and (ii) take whatever additional actions are necessary or appropriate to maintain the City’s participation in the Plans and to maintain the Plans’ compliance with applicable law; and
(iii) take whatever additional actions are necessary or appropriate to administer the City’s Plans.
PASSED, APPROVED AND ADOPTED on this 13th day of February, 2024, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
APPROVED:
ANDREA ALEXANDER
City Clerk
City of Lancaster
R. REX PARRIS
Mayor
City of Lancaster
STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
CITY OF LANCASTER
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CERTIFICATION OF RESOLUTION
CITY COUNCIL
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I, , City of
Lancaster, California, do hereby certify that this is a true and correct copy of the original Resolution No. 24-XX, for which the original is on file in my office.
WITNESS MY HAND AND THE SEAL OF THE CITY OF LANCASTER, on this day of , .
(seal)