§ 16-166. Benefit amounts and eligibility.

(a) Normal retirement date. A member's normal retirement date shall be the first day of the month coincident with, or next following the date he attains the earlier of:

(1) Age fifty-five (55) with ten (10) or more years of credited service; or

(2) Age fifty-two (52) with twenty-five (25) years of credited service, for members who separate from service before October 1, 1998; and

(3) Age fifty (50), with twenty-five (25) years of credited service, for members who separate from service on or after October 1, 1998.

A member may retire on his or her normal retirement date or on the first day of any month thereafter. Normal retirement under the plan is retirement from employment with the city on or after the normal retirement date. Each member who retires on or after normal retirement age shall receive a normal retirement pension.

(b) Normal retirement benefit. A member retiring hereunder on or after his or her normal retirement date shall receive a monthly benefit consisting of a single life annuity which shall commence on the first day of the month next following his or her retirement and be continued thereafter during member's lifetime, ceasing upon death, but with one hundred twenty (120) monthly payments guaranteed in any event. The monthly retirement benefit for a firefighter shall equal: (1) two and one-half (2½) percent of average final compensation, for each year of credited service for members separating from service prior to October 1, 1998; or (2) three (3) percent of average final compensation, for each year of credited service for members who separate from service on or after October 1, 1998. Notwithstanding the preceding, effective October 1, 2012, for all members who have not vet retired and/or entered the DROP as of the enactment date of September 17, 2013, the maximum total benefit provided by the fund shall be limited to the lesser of either: seventy-five thousand ($75,000.00) per year; or three (3) percent of average final compensation, for each year of credited service. In no event shall the maximum total benefit provided by the fund be less than two (2) percent of average final compensation, for each year of credited service. Once the maximum pension benefit, as defined herein, is met, all pension contributions made on behalf of the member will permanently cease. The monthly retirement income for a firefighter shall be reduced for moneys received under the disability provisions of this plan so that the monthly benefit shall not exceed the greater of the disability or retirement pension.

(c) Delayed retirement. Retirement may be delayed by a member and shall not be mandatory solely by reason of age prior to the required beginning date specified in section 16-175, hereof. The delayed retirement date shall be the first day of the month coincident with, or next following, actual retirement.

(d) Early retirement date. A member may retire on his or her early retirement date which shall be the first day of any month coincident with or next following the attainment of age fifty (50) and the completion of ten (10) years of credited service. Early retirement under the plan is retirement from employment with the city on or after the early retirement date and prior to the normal retirement date.

(e) Early retirement benefit. A member retiring hereunder on his or her early retirement date may receive either a deferred or an immediate monthly retirement benefit payable for life, with one hundred twenty (120) monthly payments guaranteed, as follows:

(1) A deferred monthly retirement benefit which shall commence on what would have been the member's normal retirement date had he remained a firefighter and shall be continued on the first day of each month thereafter. The amount of each such deferred monthly retirement benefit shall be a life annuity determined in the same manner as for retirement at normal retirement date except that credited service and average final compensation shall be determined as of the early retirement date; or

(2) An immediate monthly retirement benefit which shall commence on the member's early retirement date and shall be continued on the first day of each month thereafter. The benefit payable shall be as determined in subsection (1) above, which is actuarially reduced from the amount to which the member would have been entitled had the member retired on his normal retirement date and with the same number of years of credited service as at the time benefits commence and based on the member's average final compensation at that date. In no event shall the early retirement reduction exceed three (3) percent for each year by which the member's age at retirement precedes the member's normal retirement age.

(f) Immediate and deferred payment of early retirement benefit. The board shall commence payment of the immediate early retirement pension on the first day of the month designated by the member as the annuity starting date, so long as such date follows the member's termination of service with the city. If a member elects a deferred early retirement pension, or fails to designate an annuity starting date, the board shall commence payment following the member's attainment of normal retirement age.

(g) Termination benefit—Generally. A member whose employment terminates for any reason prior to becoming eligible for an early or normal retirement pension, shall receive either a deferred pension, calculated in the manner set forth in subsection (h) of this section herein; or a refund benefit in an amount equal to the total contributions made by the member to the plan. A member shall only be entitled to a deferred pension if he has at least ten (10) years of credited service. Notwithstanding the provisions of this section, a member, at any time prior to the commencement of his normal retirement pension, his early retirement pension or his deferred pension, may elect to receive a refund benefit in lieu thereof.

(h) Amount of deferred pension. The member's deferred pension shall be a single life annuity, with a one hundred twenty-month guarantee, computed in the same manner as the early retirement pension if the member elects to begin receiving his monthly pension before age fifty-five (55) or it shall be a single life annuity, with a one hundred twenty-month guarantee, computed in the same manner as the normal retirement pension if the member elects to begin receiving his pension on or after age fifty-five (55), with such benefit to be determined as of the date on which his termination of employment occurs.

(i) Payment of deferred pension. A terminated member's deferred pension shall become payable in the same manner as a normal retirement pension, or if elected by the member in the manner provided in subsection (h) hereof, in the same manner as an early retirement pension.

(j) Effective date of change in benefits. Members separating from service before October 1, 1998, shall only be entitled to the benefits provided by the plan prior to October 1, 1998.

(k) Deferred retirement option plan (DROP).

(1) Operation. Any member of the system who has satisfied the requirement for normal retirement as set forth herein may elect to withdraw from the system while continuing to be an employee of the city for a period of up to five (5) years. During this period, the member and employer shall cease to make contributions to the fund and benefit accruals shall cease at the date of withdrawal from the system. At the time of the withdrawal, the member may elect any optional form of retirement income as allowed by the plan. The amount of the monthly pension which would otherwise be paid shall be maintained as a co-mingled DROP account(s) in the name of the member within the fund and shall be segregated from other trust assets on a bookkeeping basis only.

a. Upon electing participation in the DROP, the member shall elect to receive, by designating full or partial allocation of the monthly benefit amount, either interest and/or earnings on his or her accounts to be determined as provided below. The member may elect, in writing, to change his or her election on a quarterly basis during DROP participation. An election to change must be made at least thirty (30) days prior to the beginning of a calendar quarter and shall be effective on the first day of the calendar quarter immediately following such notice of election. There shall be no limit on the number of such transfers.

1. Earnings election. Quarterly the DROP account shall share in the investment gains and losses for the quarter at the same rate of the return earned by the total trust fund; and/or

2. Interest election. The DROP account shall be credited interest based on the trust fund's money market interest rate compounded quarterly.

3. Any additional cost arising for the election of partial allocation of the monthly benefit amount shall be paid by the member.

b. Regardless of the option selected by the participant, the board of trustees has the right to accelerate payments in order to comply with section 401(a)(9) IRC and the right to defer payments to comply with section 415 IRC.

(2) Termination of employment. Upon termination of employment, not later than five (5) years following entry into the DROP program, the member shall commence receiving the monthly benefit in the same form and amount as selected at the time of entry into the DROP program. In addition, the member shall receive the value of his DROP account in a single lump sum payment.

(3) Continued employment. In the event that the member continues employment following completion of the DROP period, the member shall forfeit his or her entitlement to the accumulated assets in the DROP account, which account shall no longer be segregated from the other assets of the plan, and such member shall deposit to the fund an amount equal to the member contributions which would have been made had the member continued as an active participant in the plan during the DROP period. Upon later termination of employment, the retiring member shall receive benefit credit for years and completed months during which he or she participated in the DROP program and for which member contributions were subsequently made, as well as credited service accrued before and after participation in the DROP plan.

(4) Computation of plan benefits. The benefits of a member who makes an election to withdraw from the system while continuing to be an employee of the city, shall be determined based upon including as salary, at the time of withdrawal, the amount of accrued vacation and sick pay which would have been available had such member terminated employment at the time of making the election. Notwithstanding the above, payments made to a withdrawing member's DROP account shall be reduced by the product obtained by multiplying the then applicable member contribution rate by the amount of accrued vacation pay and sick pay which is includible in the above calculation.

(Ord. No. 98-18, § 2, 10-20-98; Ord. No. 2000-12, § 2, 9-5-00; Ord. No. 2002-01, § 2, 5-7-02; Ord. No. 2004-07, § 2, 5-18-04; Ord. No. 2010-17, § 1, 10-19-10; Ord. No. 2013-16, § 2, 9-17-13)