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RESOLUTIQN 2008-23
Affirmation of Authorization to Pick-up the Employee's Contribution to
VRS for TOWN OF PULASKI, 55387
Under § 414(h) of the Internal Revenue Code ~ `
WHEREAS, the TOWN OF PLTLASKI provides its employees with tax deferral pursuant
to § 414(h) of the Internal Revenue Code with respect to their member contributions to
the Virginia Retirement System (referred to as VRS) by picking up member contributions
to~VRS; and ~~
WHEREAS, VRS keeps track of such picked up member contributions, and treats such
contributions as employee contributions for all purposes of VR5;
WHEREAS, the Internal Revenue Service in Notice 2006-43 has provided transition
relief for existing pick up arrangements provided that an authorized person takes formal
action to evidence the establishment of the pick-up arrangement no later than January 1,
2009.
WHEREAS, in order to avail itself of the protection given under Notice 2006-43, the
TOWN OF PULASKI desires to affirm. its intention to establish and maintain spick-up
arrangement through formal action by its governing body.
NOW, THEREFORE, IT IS HEREBY RESOLVED that the existing member
contribution pick-up arrangement is hereby affirmed as it relates to salary reduction
elections in effect prior to the date of this Resolution, and it is further
RESOLVED that effective the first pay day on or after 9 -1- 0 8 ,the Town shall
pickup member contributions of its employees to VRS, and such contributions shall be
treated as employer contributions in determining tax treatment under the Internal
Revenue Code of the United States; and it is further
RESOLVED that such contributions, although designated as member contributions, are to
be made by the TOWN OF PULASKI in lieu of member contributions; and it is further
RESOLVED that pick up member contributions shall be paid from the same source of
funds as used in paying the wages to affected employees; and it is further
RESOLVED that member contributions made by the TOWN OF PULASKI under the
pickup arrangement shall be treated for all purposes other than income taxation,
including but not limited to VRS benefits, in the same manner and to the same extent as
member contributions made prior to the pick up arrangement; and it is further
RESOLVED that nothing herein shall be construed so as to permit or extend an option to
VRS members to receive the pick up contributions made by the TOWN OF PULASKI
directly instead of having them paid to VRS; and it is further
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RESOLVED that notwithstanding any contractual or other provisions, the contributions
of each member of VRS who is an employee of the TOWN OF PULASKI shall be picked
up either through a reduction in the current salary of such employee or as an offset
against future salary increases of such employee or as a combination of both at the option
of the employer by the TOWN OF PULASKI on behalf of such employee pursuant to the
foregoing resolutions.
Adopted in PULASKI, Virginia this 2nd day of S e p t e m b e r, 2 00 8
Jeffrey S: Worrell Mayor
Name & Title Printed
uthorized Sign~itlire- Title
c.~
ATTEST; CLERK OF COUNCIL
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8/2006