05-260 Resolution No. 05-260
RESOLUTION
AUTHORIZING EXECUTION OF AN ADMINISTRATIVE SERVICES AGREEMENT
WITH THE INTERNATIONAL CITY MANAGEMENT ASSOCIATION
RETIREMENT CORPORATION ("ICMA-RC")
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN,ILLINOIS,that
Olufemi Folarin,City Manager,and Dolonna Mecum,City Clerk,be and are hereby authorized and
directed to execute an Administrative Services Agreement with the International City Management
Association Retirement Corporation ("ICMA") on behalf of the City of Elgin, a copy of which is
attached hereto and made a part hereof by reference.
s/Ed Schock
Ed Schock,Mayor
Presented: August 24, 2005
Adopted: August 24, 2005
Vote: Yeas: 7 Nays: 0
Attest:
s/Dolonna Mecum
Dolonna Mecum, City Clerk
I
ADMINISTRATIVE SERVICES AGREEMENT
Type: VantageCare RHS
Account Number: 801087
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Plan # 801087
ADMINISTRATIVE SERVICES AGREEMENT
This Agreement, made as of the 2 day of fl u o u s� , 2005 (herein
referred to as the "Inception Date"), between The International City Management
Association Retirement Corporation ("ICMA-RC"), a nonprofit corporation organized
and existing under the laws of the State of Delaware; and the City of Elgin, Illinois
("Employer") a local govenmental instrumentality organized and existing under the laws
of the State of Illinois with an office at 150 Dexter Court, 2nd Floor, Elgin, Illinois, 60120.
RECITALS
Employer acts as a public plan sponsor for a retiree health plan with responsibility to obtain
investment alternatives and services for employees participating in that plan;
Employer desires to make the VantageCare Retirement Health Savings Plan ("RHS Plan"
or"Plan") provided by ICMA-RC available to its employees;
ICMA-RC makes available the Vantagepoint Funds, a no-load,diversified mutual fund,for
investment of public employer plan assets, including RHS Plan assets;
ICMA-RC provides a complete offering of services to public employers for the operation of
employee retirement and retiree health savings plans including, but not limited to,
communications concerning investment alternatives, account maintenance, account
record-keeping, investment and tax reporting, form processing, benefit disbursement and
asset management.
•
AGREEMENTS
1. Acceptance of RHS Plan
Employer agrees to make the RHS Plan provided by ICMA-RC available to its
employees. The details of the RHS Plan shall be as mutually agreed between the
Employer and ICMA-RC, and in general shall be as set forth in the RHS Plan materials
developed by ICMA-RC and provided to Employer. The RHS Plan materials are hereby
incorporated by reference and made a part of this Agreement, except that Employer
and ICMA-RC may from time to time mutually agree in writing to terms that vary from
the RHS Plan materials. RHS plan materials shall include the VantageCare RHS
Employer Manual, available electronically through the EZ Link System upon plan
adoption.
The functions to be performed by ICMA-RC and its agents include:
(a) allocation in accordance with participant direction of individual accounts to
investment funds ("Funds") made available to Plan participants;
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• Plan # 801087
(b) maintenance of individual accounts for participants reflecting amounts contributed,
income, gain, or loss credited, and amounts disbursed as benefits;
(c) provision of periodic reports to the Employer and participants of the status of Plan
investments and individual accounts;
(d) communication to participants of information regarding their rights and elections
under the Plan;
(e) disbursement of benefits as agent for the Employer in accordance with terms of the
Plan; and
(f) performance of tax withholding and reporting in conjunction with the Employer for
each RHS account.
2. Employer Duty to Furnish Information
Employer agrees to furnish to ICMA-RC on a timely basis such information as is necessary
for ICMA-RC to carry out its responsibilities with respect to the Plan, including information
needed to allocate individual participant accounts to Funds, and information as to the
employment status of participants,and participant ages,addresses, beneficiaries and other
identifying information (including tax identification numbers). ICMA-RC shall be entitled to
rely upon the accuracy of any information that is furnished to it by a responsible official of
the Employer or any information relating to an individual participant, dependent, or
beneficiary that is furnished by such participant, dependent, or beneficiary, and ICMA-RC
shall not be responsible for any error arising from its reliance on such information. ICMA-
RC will provide account information in reports, statements or accountings.
3. Certain Representations and Warranties
ICMA-RC represents and warrants to Employer that:
(a) ICMA-RC is a non-profit corporation with full power and authority to enter into this
Agreement and to perform its obligations under this Agreement.
(b) ICMA-RC is an investment adviser registered as such with the Securities and
Exchange Commission under the Investment Advisers Act of 1940, as amended.
ICMA-RC Services, LLC (a wholly owned subsidiary of ICMA-RC)is registered as a
broker-dealer with the 'Securities and Exchange Commission (SEC) and is a
member in good standing of the National Association of Securities Dealers, Inc.
Employer represents and warrants to ICMA-RC that:
(c) Employer is organized in the form and manner recited in the opening paragraph of
this Agreement with full power and authority to enter into and perform its obligations
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• Plan # 801087
parties.
(b) The parties agree that an adjustment to compensation or administrative and
operational services under this Agreement may only be implemented by ICMA-RC
through a proposal to the Employer via correspondence or the Employer Bulletin.
The Employer will be given at least 60 days to review the proposal before the
effective date of the adjustment. Such adjustment shall become effective unless,
within the 60 day period before the effective date,the Employer notifies ICMA-RC in
writing that it does not accept such adjustment, in which event the parties will
negotiate with respect to the adjustment.
(c) No failure to exercise and no delay in exercising any right, remedy, power or
privilege hereunder shall operate as a waiver of such right, remedy, power or
privilege.
10. Notices
All notices required to be delivered under Section 10 of this Agreement shall be delivered
personally or by registered or certified mail, postage prepaid, return receipt requested,to(i)
Legal Department, ICMA Retirement Corporation, 777 North Capitol Street, N.E., Suite
600, Washington, D.C, 20002-4240; (ii) Employer at the office set forth in the first
paragraph hereof, or to any other address designated by the party to receive the same by
written notice similarly given.
11. Complete Agreement
This Agreement shall constitute the sole agreement between ICMA-RC and Employer
relating to the object of this Agreement and correctly sets forth the complete rights, duties
and obligations of each party to the other as of its date. Any prior agreements, promises,
negotiations or representations, verbal or otherwise, not expressly set forth in this
Agreement are of no force and effect.
12. Governing Law
This agreement shall be governed by and construed in accordance with the laws of the
State of Illinois, applicable to contracts made in that jurisdiction without reference to its
conflicts of laws provisions.
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.
Plan # 801087
In Witness Whereof, the parties hereto have executed this Agreement as of the Inception
Date first above written.
by: ". .....\.. �
Signature/Da
)Q \
Name and Title (Please Print)
INTERNATIONAL CITY MANAGEMENT
ASSOCIATION RETIREMENT
CORPORATION
•
by:
Paul Gallagher
Corporate Secretary
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{oFf4
C> 'c�ti Agenda Item No. CD—ko
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— City of Elgin
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August 19, 2005 1
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TO: Mayor and Members of the City Council
FINANCIALLY K IfN STABLE EFARCE VEPNMEN7
EFi'K If NT SF.FNK:FS.
AND QUALITY INFMS RL/CTORE
FROM: Olufemi Folarin, City Manager
Gail Cohen, Human Resources d Purchasing Director
SUBJECT: ICMA Post Retirement Health Benefit Plan
PURPOSE
The purpose of this memorandum is to provide the Mayor and members of the City Council with
information to enter into an agreement with ICMA for a Post Retirement Health Benefit Plan for
police officers.
RECOMMENDATION
It is recommended that the Mayor and members of the City Council approve the agreement with
ICMA for a Post Retirement Health Benefit Plan for police officers.
BACKGROUND
In its contract for the period January 1, 2004 through December 31, 2006, the Policemen's
Benevolent and Protective Association, Unit #54 (PBPA) and the City agreed to implement a
Post Retirement Health Benefit Plan (PEHB) for police officers. This plan will allow officers to
convert unused sick leave and vacation time into a dollar equivalent at time of retirement to be
placed into a health benefit plan that will permit retired officers to use the funds for health
related expenses. A PEHB is similar to the flexible spending accounts the City has initiated.
Contributions are considered pre-tax, grow tax-deferred, and are used for qualified medical
expenses. ICMA, one of the City's deferred compensation providers, can provide a PEHB that
meets the contractual requirements.
Conversion of sick time into a PEHB contribution is predicated on leaving the City's
employment in good standing and requires an accumulation of sick leave of over 90 accrued sick
days which is the equivalent of 720 hours of sick leave. Such conversion is limited to a
maximum of 20 days or 160 hours upon separation. The remaining balance of unused sick leave
may not total less than the required base accumulation of 90 days.
1
Post Retirement Health Benefit Plan
August 19, 2005
Page 2
COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED
None.
► ,FINANCIAL IMPACT
f / There is no cost to the City as a result of implementing the PEHB plan. Any police officer who
�/ otherwise would qualify for vacation pay or the accumulated sick leave benefit at time of
retirement is eligible to participate in the PEHB plan. The ICMA RC administers the plan and
any associated fees are borne by participants in the plan.
VLF,,+RAL IMPACT
" None.
ALTERNATIVES
1. Enter into the agreement as recommended.
1" 2. Enter into an agreement with another organization.
Respectfully submitted for Council consideration.
GAC