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POLICE AND FIREFIGHTERS CONSOLIDATED PENSION PLAN AMENDMENTS (B)
Ordinance No. 110452
An ordinance of the City of Gainesville, Florida, amending Chapter 2, Article VII, Division 8, of the Code of Ordinances of the City of Gainesville, relating to the City of Gainesville Police Officers and Firefighters Consolidated Retirement Plan; amending Section 2-605 to expressly provide that the corpus and income of the plan are to be used for the exclusive benefit of the plan participants and their beneficiaries; providing directions to the codifier; providing a severability clause; providing a repealing clause; and providing a retroactive effective date.
recommendation
The City Commission adopt the proposed ordinance.
explanation
The City Commission, at its meeting on November 3, 2011, authorized the City Attorney to prepare, and the Clerk of the Commission to advertise, an ordinance amending the City of Gainesville Police Officers and Firefighters Consolidated Retirement Plan to add the exclusive benefit rule language required by IRS Revenue Ruling 2011-1.
In order for the City's pension plans to continue to invest in group trusts and not affect the tax status of the group trusts they invest in, IRS Revenue Ruling 2011-1 requires governmental pension plans to expressly provide in their governing documents "that it is impossible for the corpus or income of the group trust retiree benefit plan to be used for, or diverted to, purposes other than the exclusive benefit of the plan participants and their beneficiaries." This language is sometimes referred to as the "exclusive benefit rule."
While the City of Gainesville Police Officers and Firefighters Consolidated Retirement Plan currently contains similar language to the language referenced above in Section 2-605(a)(1) of the Gainesville Code of Ordinances ("The City Commission shall have the right, at any time, to amend any or all of the provisions of the plan; provided, however, that no su...
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