CC RES 2013-003RESOLUTION NO. 2013 -03
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF RANCHO PALOS VERDES
ADOPTING A RETIREE HEALTH SAVINGS PLAN AND 115 TRUST.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Rancho Palos Verdes
(the "City ") HEREBY FINDS, RESOLVES AND ORDERS AS FOLLOWS:
Background
SECTION 1. On November 17, 2009, the City Council approved the adoption of a trust and
retirement health savings plan designed by OptumHealth Financial Services (Optum) to provide
post - retirement health care benefits for eligible employees and their eligible dependents and
survivors (Optum Plan), and engaged Optum to operate and administer the Optum Plan.
SECTION 2. In late 2012, Optum notified the City of its intent to terminate its agreement to
administer the Optum Plan, effective December 31, 2012, explaining that Optum will no longer
provide administrative services for retirement health savings plans. Optum subsequently extended
the termination date of its agreement with the City until April 1, 2013, giving City staff sufficient time
to find a new provider for these services.
SECTION 3. The City Council believes it to be in the City's best interest to adopt a new trust and
retirement health savings plan designed by ICMA -RC, and to engage ICMA -RC to operate and
administer the new plan and trust. The new plan and trust will provide substantially the same
benefits as those previously provided through the Optum Plan.
Adoption of the Retirement Health Savings Plan in the form of ICMA -RC's Retirement Health
Savings Program.
SECTION .4. Effective February 5, 2013, the City Council hereby adopts the City of Rancho Palos
Verdes Retirement Health Savings Plan (RHS Plan), substantially in the form of the ICMA -RC
Retirement Health Savings Program attached hereto (with any modifications deemed appropriate
by the Interim HR Manager and the City's legal counsel), to provide post - retirement health care
benefits for eligible participants and their eligible dependents and survivors.
Adoption of an Internal Revenue Code § 115 Trust in the Form of ICMA -RCs Integral Part
Trust
SECTION 5. Effective February 5, 2013, the City Council hereby adopts an Internal Revenue Code
section 115 trust ( "RHS Trust "), substantially in the form of the ICMA -RC Integral Part Trust
attached hereto (with any modifications deemed appropriate by the Interim HR Manager and the
City's legal counsel), for the exclusive benefit of eligible participants and their qualified dependents
and survivors under the RHS Plan. Assets under the RHS Trust may not be diverted for any
purpose prior to satisfaction of all liabilities of the RHS Plan. On or as soon as administratively
practicable after the effective date, all assets held in the trust under the Optum Plan will be
transferred to the RHS Trust. The Optum Plan and trust will immediately terminate upon the
transfer of all assets to the RHS Trust.
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Resolution No. 2013 -03
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SECTION 6. The RHS Trust will be tax - exempt to the maximum extent allowed under section 115
of the Internal Revenue Code.
SECTION 7. All assets under RHS Plan, including all contributions to the RHS Plan and any
earnings on those amounts, will be held in the RHS Trust.
Adoption of Administrative Services Agreement with ICMA -RC
SECTION 8. The City Council hereby approves the retention of ICMA -RC to operate and
administer the RHS Plan, pursuant to the terms and conditions of the Administrative Services
Agreement between the City and ICMA -RC attached hereto (with any modifications deemed
appropriate by the Interim HR Manager and the City's legal counsel).
Termination of Current Plan and Trust
SECTION 9. This resolution ratifies the termination of the Optum Plan and trust, effective upon the
complete transfer of all assets under that trust to the RHS Trust. .
General Authorizing Resolutions
SECTION 10. The Interim HR Manager is authorized and directed, for and on the City's behalf, to
take such further action as the Interim HR Manager deems necessary or appropriate to carry out
the foregoing resolutions.
SECTION 11. The Interim HR Manager (or any successor) is authorized on the City's behalf to
amend the RHS Plan or RHS Trust at any time as necessary or appropriate to satisfy the
applicable requirements of the law; however, any amendment that increases the City's costs will
not be effective without the City Council's prior written approval.
PASSED APPROVED AND ADOPTED this 5t" day of February 2013
May r
Attest:
City Clerk
State of California )
County of Los Angeles )ss
City of Rancho Palos Verdes )
I, Carla Morreale, City Clerk of the City of Rancho Palos Verdes, hereby certify that
the above Resolution No. 2013 -03 was duly and regularly passed and adopted by the said City
Council at a regular meeting thereof held on February 5, 2013.
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Resolution No. 2013 -03
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