§ 16-186. Defined Contribution Component Supplemental Retirement Benefit.

(a)  There is hereby provided, in addition to all other benefits provided in this Article, a defined contribution component supplemental retirement benefit. The defined contribution component supplemental retirement benefit shall consist of an individual share account for each Member of the Plan, including DROP participants. The supplemental retirement benefit shall be funded solely by premium tax revenues in excess of the 2013 frozen amount received by the city pursuant to F.S. Ch. 175, as provided for by the City of Lake Wales Code of Ordinances. Effective October 1, 2016, fifty percent (50%) of the premium tax revenues received by the City in excess of the 2013 frozen amount shall be allocated to Members’ share accounts as provided for herein with the remaining fifty percent (50%) of the premium tax revenue received by the City to be used at the discretion of the City toward current year benefits (either defined benefit or defined contribution), as an immediate reduction of unfunded actuarial liability (UAL) balance, or reserved as a prepaid sponsor contribution toward future required funding. Member share accounts shall be credited with premium tax revenues and investment earnings and losses and account distributions as outlined herein.

(b)  Annual crediting. Effective September 30, 2016, and each September 30^th thereafter, the share account of each Member and DROP participant on the City’s payroll as of the preceding September 30 shall be credited as follows. Each Member and DROP participant who was employed on the preceding September 30 shall receive one share for each complete year and fractional part of years of Credited Service, as defined in section 16-161, determined as of the end of the Plan year ending on the same September 30. The total number of shares thus determined shall be divided into the total premium tax revenues received during that plan year to determine the amount to be credited to the share account of each eligible share plan participant.

(c)  Investment earnings and losses. Effective September 30, 2016, and each September 30^th thereafter, the share account of each Member and DROP participant shall be credited or debited with earnings or losses based upon the amount in the share account at the beginning of the immediately preceding fiscal year, as may be adjusted for any subsequent distributions, at a rate equal to the Plan’s actual net rate of investment return for such fiscal year. Share accounts shall be commingled in the Fund and invested as with any other Fund asset. Share accounts shall be segregated into individual member accounts on a bookkeeping basis only. Alternatively, effective upon adoption, instead of the "net investment return" as set forth above, each Member may direct a one-time irrevocable election at any time prior to separation from service that his or her Share account be invested in a money market fund as may be made available from time to time by the board. The electing member's Share account shall be credited or debited at a rate equal to the net rate of investment return realized by such money market fund.

(d)  Distribution of share accounts. A Member or DROP participant with ten or more years of credited service upon termination of employment and eligibility for receipt of pension benefits shall be eligible to receive a distribution of the balance in his or her share account, together with all earnings and losses credited or debited to the share account through the date of termination of employment. No supplemental retirement benefit shall be payable to a Member who terminates covered employment with less than ten years of Credited Service. The share account balances of such non-vested terminated Members shall be redistributed among all eligible participants’ share accounts in the same manner as premium tax revenues in the following calendar year. The designated beneficiary of a Member who dies having accumulated ten or more years of Credited Service shall receive the accumulated total of the Member’s share account balance. There shall be no forfeiture of a Member’s share account based on the Member’s death, disability, or termination of employment with ten or more years of Credited Service. Payment of share account benefits shall be by lump sum, which shall consist of the accumulated total balance of a Member’s share account, or, at the Member’s direction, the share account balance may be rolled over to another qualified plan in accordance with section 16-175 of this Plan. One additional payment or rollover will be made on the January 1 following termination of employment for any supplemental retirement benefit amount credited for the Member’s year of termination.

(Ord. No. 2016-14, § 1, 12-06-16; Ord. No. 2021-21, § 5, 9-10-21)