Resolution 4995 - Deferred Compensation Plan AmendmentRESOLUTION NO. 4995
A RESOLUTION BY THE CITY OF KALISPELL APPROVING AN AMENDMENT TO
THE CITY'S DEFERRED COMPENSATION PLAN.
WHEREAS, the City of Kalispell previously adopted a deferred compensation plan within the
context of Section 457(b) of the Internal Revenue Code for the benefit of the
employer's eligible employees; and
WHEREAS, the IRS recently clarified previous legislation enacted by the Economic Growth
and Tax Relief Reconciliation Act of 2001 regarding mandatory distributions
under the plan; and
WHEREAS, the Amendment to the Deferred Compensation Plan attached hereto complies with
the new automatic rollover rules issued by the IRS.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
KALISPELL AS FOLLOWS:
That the Amendment to the Deferred Compensation Plan (the "Plan"), attached hereto
and hereby incorporated fully herein, which addresses the Plan's compliance with the
"automatic rollover'' requirements of Internal Revenue Code Section 401(a)(31)(B), is
hereby approved and adopted, and the City Manager is hereby authorized and directed to
execute and deliver to the Administrator of the Plan, one or more counterparts of the
amendment, the same to be effective March 28, 2005.
PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF
THE CITY OF KALISPELL, THIS 21 ST DAY OF MARCH, 2005.
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Pamela B. Kennedy
Mayor
ATTEST:
T eresa White
City Clerk
MANDATORY DISTRIBUTION AMENDMENT
(Cade Section 401(a)(31)(B))
ARTICLE I
APPLICATION OF AMENDMENT
1.1 Effective Date. Unless a later effective date is specified in Article III of this Amendment,
the provisions of this Amendment will apply with respect to distributions made on or
after March 28, 2005.
1.2 Precedence. This Amendment supersedes any inconsistent provision of the Plan.
ARTICLE II
DEFAULT PROVISION: AUTOMATIC ROLLOVER
OF AMOUNTS OVER $1,000
Unless the Employer otherwise elects in Article III of this Amendment, the provisions of
the Plan concerning mandatory distributions of amounts not exceeding $5,000 are amended as
follows:
In the event of a mandatory distribution greater than $1,000 that is made in
accordance with the provisions of the Plan providing for an automatic distribution
to a Participant without the Participant's consent, if the Participant does not elect
to have such distribution paid directly to an "eligible retirement plan" specified by
the Participant in a direct rollover (in accordance with the direct rollover
provisions of the Plan) or to receive the distribution directly, then the
Administrator shall pay the distribution in a direct rollover to an individual
retirement plan designated by the Administrator.
ARTICLE III
EMPLOYER'S ALTERNATIVE ELECTIONS
3.1 Effective Date of Plan Amendment
This Amendment applies with respect to distributions made on or after March 28, 2005
(may be a date later than March 28, 2005, only if the terms of the Plan already comply
with Code Section 401(a)(31)(B))•
3.2 Election to Reduce or Eliminate Mandator Distribution Provisions of Plan
In lieu of the default provision in Article II of this Amendment, the provisions of the Plan
that provide for the involuntary distribution of vested accrued benefits of $5,000 or less,
are modified as follows:
Reduction of $5,000 threshold to $1,000. The $5,000 threshold in such
provisions is reduced to $1,000 and the value of the Participant's interest
in the Plan for such purpose shall include any rollover contributions (and
earnings thereon) within the meaning of Code Sections 402(c), 403(a)(4),
403(b)(8). 408(d)(3)(A)00. and 457(e)(16)_
This amendment is executed as follows:
Name of Plan: Deferred Compensation Plan
Name of Employer:
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Date; G �:r
Employer ��