HomeMy WebLinkAbout2010-13RESOLUTION 2010-13
Authorization to Pick-up the Employee's Contribution to VRS
Under § 414(h) of the Internal Revenue Code For Plan 2 Employees
WHEREAS, the Virginia General Assembly, in its 2010 session passed legislation creating a
separate retirement plan for employees hired on or after July 1, 2010 (hereafter referred to
as "Plan 2 Employees").The legislation stipulates that Plan 2 Employees will pay their 5
percent member contribution and that, absent other action by the employer, such
contribution will be paid through salary reduction according to Internal Revenue Code §
414 (h) on a pre-tax basis; and
WHEREAS, the legislation allows certain employers, including the Town of Pulaski, to pick-up
and pay all or a portion of the member contributions on behalf of its Plan 2 Employees as
an additional benefit not paid as salary; and
WHEREAS, the election to pick-up and pay all or a portion of the member contributions on
behalf of its Plan 2 Employees as an additional benefit not paid as salary shall, once
made, remain in effect for the applicable fiscal year (July 1 -June 30) and shall continue
in effect beyond the end of such fiscal year absent a subsequent resolution changing the
way the 5 percent member contribution is paid; and
WHEREAS, employee contributions that are picked-up as an additional benefit not paid as
salary are not considered wages for purposes of VA Code § 51.1-700 et seq. nor shall they
be considered salary for purposes of VA Code § 51.1-100 et seq.; and
WHEREAS, the Town of Pulaski desires to pick-up and pay its Plan 2 Employees' member
contributions to VRS as an additional benefit not paid as salary in an amount equal to five
percent (5%) of creditable compensation; and
WHEREAS, VRS tracks such picked-up member contributions and is prepared to treat such
contributions as employee contributions for all purposes of VRS.
NOW, THEREFORE, IT IS HEREBY RESOLVED that effective the first day of July, the Town of
Pulaski shall pick-up member contributions of its Plan 2 Employees to VRS as an additional
benefit not paid as salary in an amount equal to five percent (5%) of creditable
compensation subject to the terms and conditions described above; 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 nothing herein shall be construed so as to permit or extend an option to
VRS members to receive the picked-up contributions made by the Town of Pulaski directly
instead of having them paid to VRS.
4 _ Y
This Resolution is effective upon adoption and is hereby adopted this 15'" day of June,
2010, by the duly recorded vote of the Town Council of the Town of Pulaski, Virginia as
follows:
David L. Clark -Aye
Larry G. Clevinger, II -Aye
H. M. Kidd -Absent
Joel B. Burchett, Jr. -Aye
Robert A. Bopp -Aye
Morgan P. Welker -Aye
THE TOWN OF PULASKI, VIRGINIA
BY:
y S. Worrell, Mayor
ATTEST:
Patricia Cruise, Clerk of Council
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