§ 2-71. Repeal or termination of system.

(1)

This division establishing the system and the fund, and subsequent ordinances pertaining to said system and fund, may be modified, terminated or amended, in whole or in part; provided, that if this [division] or any subsequent ordinance shall be amended or repealed in its application to any person benefiting hereunder, the amount of benefits which at the time of any such alteration, amendment or repeal shall have accrued to the member or beneficiary shall not be affected thereby, except to the extent that the assets of the fund may be determined to be inadequate.

(2)

If this division shall be repealed, or if contributions to the system are discontinued, the board shall continue to administer the system in accordance with the provisions of this division for the sole benefit of the then members, and beneficiaries then receiving retirement allowances, and any future persons entitled to receive benefits under one of the options provided for in this division who are designated by any of said members. In the event of repeal, or if contributions to the system are discontinued, there shall be full vesting one hundred (100) percent) of benefits accrued to date of repeal and the assets of the system shall be allocated in an equitable manner to provide benefits on a proportionate basis to the persons so entitled to benefits in accordance with the provisions hereof.

(3)

The following shall be the order of priority for purposes of allocating the assets of the system upon repeal or termination of this division or if contributions to the system are discontinued:

(a)

Members already retired under the normal and early retirement provisions of the plan and those eligible for normal or early retirement but not actually retired, and beneficiaries receiving a retirement income on such date on account of a retired but since deceased member, to the extent of the actuarially determined present value of the benefits payable; provided that, if such asset value be less than the aggregate of such amount, such amounts shall be proportionately reduced so that the aggregate of such reduced amounts will be equal to such asset value.

If any funds remain, then:

(b)

Members retired under the disability provisions of this plan and their beneficiaries in the same manner as in (3)(a) above, including proportionate reduction if there be insufficient assets.

If any funds remain, then:

(c)

All other members and their beneficiaries in the same manner as in (3)(a), but based upon continuous service and average monthly earnings as of the date of termination of the plan, with any benefits vested under provisions of this system given precedence; provided that, if assets are insufficient, the benefits payable shall be proportionately reduced.

If any funds remain, then:

(d)

Each member's accumulated contributions to date of termination, less prior distribution, and less the actuarial present value of benefits to which such member is entitled under (3)(a), (b) or (c) above, if any; provided that, if assets are insufficient, the amounts payable shall be proportionately reduced.

(e)

In the event that there be assets remaining after the full apportionment specified in paragraphs (3)(a), (b), (c) and (d), such excess shall be returned to the city, less return of state's contributions to the state; provided, that if the excess is less than the total contributions made by the city and the state to date of termination of the plan, such excess shall be divided proportionately as among the total contributions made by the city and the state.

The allocation of the fund provided for in this subsection may, as decided by the board, be carried out through the purchase of insurance company contracts to provide the benefits determined in accordance with this subsection. The fund may be distributed in one sum to the persons entitled to said benefits or the distribution may be carried out in such other equitable manner as the board may direct. The trust may be continued in existence for purposes of subsequent distribution.

If, at any time during the first ten (10) years after the effective date of the division as respects the city, the system shall be terminated, or the full current costs of the system (consisting of the normal costs and interest on any unfunded accrued liability) shall not have been met, anything in the division to the contrary notwithstanding, city contributions which may be used for the benefit of any one of the twenty-five (25) highest paid members in the system on the effective date, whose anticipated annual retirement allowance provided by the city's contributions at his normal retirement date would exceed one thousand five hundred dollars ($1,500.00), shall not exceed the greater of either:

(a)

Twenty thousand dollars ($20,000.00); or,

(b)

An amount computed by multiplying the smaller of ten thousand dollars ($10,000.00) or twenty (20) percent of such employee's average annual earnings during his last five (5) years of service by the number of years of service since the effective date.

In the event that it shall hereafter be determined by statute, court decision, ruling by the commissioner of Internal Revenue, or otherwise, that the provisions of this paragraph are not necessary to qualify the system under the Internal Revenue Code, this paragraph shall be ineffective without the necessity of further amendment of this division.

After all the vested and accrued benefits provided hereunder have been paid and after all other liabilities have been satisfied, then and only then shall any remaining funds revert to the general fund of the city.

(Ord. No. 77-121, § 11, 6-2-77; Ord. No. 83-112, § 1(11), 3-14-83)