GE-E: Georgetown Public Schools Section 403(b)
Plan
Section 1
Definition of Terms Used
The following words and terms, when used in the Plan,
have the meaning set forth below:
1.01 Account:
The account or accumulation maintained for the benefit of any Participant or
Beneficiary under an Annuity Contract or a Custodial Account.
1.01 Account Balance: The bookkeeping account maintained for each
Participant which reflects the aggregate amount credited to the Participant’s
Account under all Accounts, including the Participant’s Elective Deferrals, the
earnings or loss of each Annuity Contract or a Custodial Account (net of
expenses) allocable to the Participant, any transfers for the Participant’s
benefit, and any distribution made to the Participant or the Participant’s
Beneficiary. If a Participant has more than one Beneficiary at the time of the
Participant’s death, than a separate Account Balance shall be maintained for
each Beneficiary. The Account Balance includes any account established under
Section 6 for rollover contributions and plan-to-plan transfers made for a
Participant, the account established for a Beneficiary after a Participant’s
death, and any account or accounts established for an alternate payee (as
defined in section 414(p)(8) of the Code).
1.03 Administrator: The Director of Finance and Operations shall be the
Plan Administrator. S/he may delegate these functions to a Third Party
Administrator (TPA), selected in accordance with State and Federal law. The
District will not assume any cost associated with a TPA.
1.04 Annuity Contract: A nontransferable contract as defined in section
403(b)(1) of the Code, established for each Participant by the Employer, or by
each Participant individually, that is issued by an insurance company qualified
to issue annuities in Massachusetts and that includes payment in the form of an
annuity.
1.05 Approved
Vendor:
An approved vendor (see § 1.22, Vendor) must meet the following
requirements:
1.05.1
Agree to follow all federal, state
and local laws, regulations, and policies;
1.05.2
Sign a service provider
agreement;
1.05.3
Sign, or provide for signature, and
information sharing agreement.
1.05.4
During the 2009 calendar year, have
at least one participant to be added to the current approved vendor
list.
1.05.5
From calendar year 2010 forward have
at least ten participants to be added to the approved vendor list or have at
least one participant to remain on the approved vendor list.
1.06 Beneficiary: The designated person who is entitled to receive
benefits under the Plan after the death of a Participant, subject to such
additional rules as may be set forth in the Individual
Agreements.
1.07 Custodial Account: The group or individual custodial account or accounts,
as defined in section 403(b)(7) of the Code, established by each Participant
individually, to hold assets of the Plan.
1.08 Code: The
Internal Revenue Code of 1986, as now in effect or as hereafter amended. All
citations to sections of the Code are to such sections are as they exist as of
this plan’s adoption date, and they may be amended or renumbered from time to
time as changes in the Code may require.
1.09 Compensation: All cash compensation for services to the Employer,
including salary, wages, fees, commissions, bonuses, and overtime pay, that is
includible in the Employee’s gross income for the calendar year, plus amounts
that would be cash compensation for services to the Employer includible in the
Employee’s gross income for the calendar year but for a compensation reduction
election under section 125, 132(f), 401(k), 403(b), or 457(b) of the Code
(including an election under Section 2 made to reduce compensation in order to
have Elective Deferrals under the Plan).
1.10 Disabled:
The definition of disability provided in the applicable Individual
Agreement.
1.11 Elective Deferral: The Employer contributions made to the Plan at the
election of the Participant in lieu of receiving cash compensation. Elective
Deferrals are limited to pre-tax salary reduction contributions.
1.12Employee:
Each individual, whether appointed or elected, who is a common law employee of
the Employer performing services for a public school as an employee of the
Employer. This definition is not applicable unless the employee’s compensation
for performing services for a public school is paid by the Employer. Further, a
person occupying an elective or appointive public office is not an employee
performing services for a public school unless such office is one to which an
individual is elected or appointed only if the person has received training, or
is experienced, in the field of education. A public office includes any elective
or appointive office of a State or local government.
1.13
Employer: The Employer under this plan is the Georgetown Public
Schools.
1.14
Funding Vehicles: The Annuity Contracts or Custodial Accounts
issued for funding amounts held under the Plan and specifically approved by the
Employer for use under the Plan.
1.15
Includible Compensation: An Employee’s actual wages in box 1 of
Form W-2 for a year for services to the Employer, but subject to a maximum of
$200,000 (or such higher maximum as may apply under section 401(a)(17) of the
Code) and increased (up to the dollar maximum) by any compensation reduction
election under section 125, 132(f), 401(k), 403(b), or 457(b) of the Code
(including any Elective Deferral under the Plan). The amount of Includible
Compensation is determined without regard to any community property
laws.
1.16
Individual Agreement: The agreement between a Vendor and the
Employer or a Participant that constitutes or governs a Custodial Account or an
Annuity Contract.
1.17
Participant: An individual for whom Elective Deferrals are
currently being made, or for whom Elective Deferrals have previously been made,
under the plan and who has not received a distribution of his or her entire
benefit under the plan.
1.18
Plan: The Plan shall be called the Georgetown Public Schools
Section 403(b) Plan.
1.19 Plan
Year: The Plan Year shall begin on January 1 and end on December
31.
1.20
Related Employer: The Employer and any other entity which is
under common control with the Employer under section 414(b) or (c) of the Code.
For this purpose, the Employer shall determine which entities are Related
Employers based upon reasonable, good faith standard and taking into account the
special rules applicable under Notice 89-23, 1989-1 C.B. 654.
1.21
Severance from Employment: For purpose of the Plan, Severance from
Employment means Severance from Employment with the Employer and any Related
Entity. However, a Severance from Employment also occurs on any date on which an
Employee ceases to be an employee of a public school, even though the Employee
may continue to be employed by a Related Employer that is another unit of the
State or local government that is not a public school or in a capacity that is
not employment with a public school (e.g., ceasing to be an employee
performing services for a public school but continuing to work for the same
State or local government employer).
1.22
Vendor: The provider of an Annuity Contract or a Custodial
Account.
1.23
Valuation Date: The Valuation Date shall be December 31 of each
Plan year.
Section 2
Participation and
contributions
2.01 Eligibility: Each Employee shall be eligible to participate in the
Plan and elect to have Elective Deferrals made on his or her behalf hereunder
immediately upon becoming employed by the Employer. However, an Employee who is
a student-teacher (i.e., a person providing service as a teacher’s aid on
a temporary basis while attending a school, college, or university) or who
normally works fewer than 20 hours per week is not eligible to participate in
the Plan. An Employee normally works fewer than 20 hours per week if, for the
12-month period beginning on the date the employee’s employment commenced, the
Employer reasonably expects the Employee to work fewer than 1,000 hours of
service (as defined under section 410(a)(C) of the Code) and, for each plan year
ending after the close of that 12-month period, the Employee has worked fewer
than 1,000 hours of service.
2.02 Compensation Reduction Election General
Rule: An Employee elects to become a Participant by executing
an election to reduce his or her Compensation (and have that amount contributed
as an Elective Deferral on his or her behalf) and filing it with the
Administrator. This Compensation reduction election shall be made on the
agreement provided by the Administrator under which the Employer agrees to be
bound by all the terms and conditions of the Plan. The Administrator may
establish annual minimum deferral amounts no higher than $200, and may change
such minimum to a lower amount from time to time. The participation election
shall also include designation of the Funding Vehicles and Accounts therein to
which Elective Deferrals are to be made and a designation of Beneficiary. Any
such election shall remain in effect until a new election is filed. Only an
individual who performs services for the Employer as an Employee may reduce his
or her Compensation under the Plan. Each Employee will become a Participant in
accordance with the terms and conditions of the Individual Agreements. All
Elective Deferrals shall be made on a pre-tax basis. An Employee shall become a
participant as soon as administratively practicable following the date
applicable under the employee’s election.
2.03 Information Provided by the
Employee. Each Employee enrolling
in the Plan should provide to the Administrator at the time of initial
enrollment, and later if there are any changes, any information necessary or
advisable for the Administrator to administer the Plan, including any
information required under the Individual Agreements.
2.04 Change in Election Deferrals
Election. Subject to the provisions
of the applicable Individual Agreements, an Employee may at any time revise his
or her participation election, including a change in the amount of his or her
Elective Deferrals, his or her investment direction, and his or her designated
Beneficiary. A change in the investment direction shall take effect as of the
date provided by the Administrator on a uniform basis for all Employees. A
change in the Beneficiary designation shall take effect when the election is
accepted by the Vendor.
2.05 Contributions Made Promptly. Elective Deferrals under the Plan shall be transferred
to the applicable Funding Vehicle within 15 business days following the end of
the month in which the amount would otherwise have been paid to the
Participant.
2.06 Leave of Absence. Unless an election is otherwise revised, if an
Employee is absent from work by leave of absence, Elective Deferrals under the
Plan shall continue to the extent that Compensation continues.
Section 3
Limitations on Amounts
Deferred
3.01 Basic Annual Limitation.
Except as provided in Sections 3.2 and
3.3, the maximum amount of the Elective Deferral under the Plan for any calendar
year shall not exceed the lesser of (a) the applicable dollar amount or (b) the
Participant’s Includible Compensation for the calendar year. The applicable
dollar amount is established under section 402(g)(1)(B) of the Code, which is
$15,500 for 2008, and is adjusted for cost of living after 2007 to the extent
provided under section 415(d) of the Code.
3.02 Special Section 403(b) Catch-up Limitation for
Employees with 15 Years of Service. Because the Employer is a qualified organization within
the meaning of § 1.403(b)-4(c)(3)(ii) of the Income Tax Regulations, the
applicable dollar amount under Section 3.1(a) for any “qualified employee” is
increased (to the extent provided in the Individual Agreements by the least of:
(a)
$3,000;
(b) The excess
of:
(1)
$15,000, over
(2) The total special 403(b) catch up elective deferrals
made for the qualified employee by the qualified organization for prior years;
or
(c) The excess of:
(1) $5,000 multiplied by the number of years of service
of the employee with the qualified organization, over
(2) The total Elective Deferrals made for the employee
by the qualified organization for prior years.
For
the purposes of this Section 3.2, a “qualified employee” means an employee who
has completed at least 15 years of service taking into account only employment
with the employer.
3.03 Age 50 Catch-Up Elective Deferral
Contributions. An Employee who is a
participant who will attain age 50 or more by the end of the calendar year is
permitted to elect an additional amount of Elective Deferrals, up to the maximum
age 50 catch-up Elective Deferrals for the year. The maximum dollar amount of
the age 50 catch-up Elective Deferrals for a year is $5,000 for 2008 and is
adjusted for cost-of-living after 2008 to the extent provided under the
code.
3.04 Coordination. Amounts in excess of the limitation set forth in
Section 3.01 shall be allocated first to the special 403(b) catch-up under
Section 3.02 and next as an age 50 catch-up contribution under Section 3.03.
However, in no event can the amount of the Elective Deferrals for a year be more
than the Participant’s Compensation for the year.
3.05 Special Rule for a Participant Covered by another
Section 403(b) Plan. For purposes of
this Section 3, if the Participant is or has been a participant in one or more
other plans under section 403(b) of the Code (and any other plan that permits
elective deferrals under section 402(g) of the Code), then this Plan and all
such other plans shall be considered as one plan for purposes of applying the
foregoing limitations of this Section 3. For this purpose, the Administrator
shall take into account any other such plan maintained by any Related Employer
and shall also take into account any other such plan for which the Administrator
receives from the Participant sufficient information concerning his or her
participation in such other plan. Notwithstanding the foregoing, another plan
maintained by a Related Entity shall be taken into account for purposes of
Section 3.02 only if the other plan is a § 403(b) plan.
3.06 Correction of Excess Elective
Deferrals. If the Elective Deferral on
behalf of a Participant for any calendar year exceeds the limitations described
above, or the Elective Deferral on behalf of a Participant for any calendar year
exceeds the limitations described above when combined with other amounts
deferred by the Participant under another plan of the employer under section
403(b) of the Code (and any other plan that permits elective deferrals under
section 402(g) of the Code for which the Participant provides information that
is accepted by the Administrator), then the Elective Deferral, to the extent in
excess of the applicable limitation (adjusted for any income or loss in value,
if any, allocable thereto), shall be distributed to the
Participant.
3.7 Protection of Persons who serve in a Uniformed
Service. An Employee whose employment
is interrupted by a qualified military service under section 414(u) of the Code
or who is on a leave of absence for qualified military service under section
414(u) of the Code may elect to make additional Elective Deferrals upon
resumption of employment with the Employer equal to the maximum Elective
Deferrals that the Employee could have elected during that period if the
Employee’s employment with the Employer had continued at the same level of
Compensation without the interruption or leave, reduced by the Elective
Deferrals, if any, actually made for the Employee during the period of the
interruption or leave. Except to the extent provided under section 414(u) of the
Code, this right applies for five years following the resumption of employment
or, if sooner, for a period equal to three times the period of the interruption
or
leave.
Section 4
Loans
4.01 Loans.
Loans shall be permitted under the Plan to the extent permitted by the
Individual Agreements controlling the Account assets from which the loan is made
and by which the loan will be secured.
4.02 Information Coordination Concerning
Loans. Each Vendor is responsible for
all information reporting and tax withholding required by applicable federal and
state law in connection with distributions and loans. To minimize the instances
in which Participants have taxable income as a result of loans from the Plan,
the Administrator shall take such steps as may be appropriate to coordinate the
limitations on loans set forth in Section 4.03, including the collection of
information from Vendors, and transmission of information requested by any
Vendor, concerning the outstanding balance of any loans made to a Participant
under the Plan or any other plan of the Employer. The Administrator shall also
take such steps as may be appropriate to collect information from Vendors, and
transmission of information to any Vendor, concerning any failure by a
Participant to repay timely any loans made to a Participant under the Plan or
any other plan of the Employer.
4.03 Maximum Loan Amount. No loan to a Participant under the Plan may exceed the
lesser of:
(a) $50,000, reduced by the greater of (i)
the outstanding balance on any loan from the Plan to the Participant on the date
the loan is made or (ii) the highest outstanding balance on loans from the Plan
to the Participant during the one-year period ending on the day before the date
the loan is approved by the Administrator, not taking into account any payments
made during such one-year period; or
(b)one half of the value of the
Participant’s vested Account Balance as of the valuation date immediately
preceding the date on which such loan is approved by the
Administrator.
For
purposes of this Section 4.03, any loan from any other plan maintained by the
Employer and any Related Employer shall be treated as if it were a loan made
from the Plan, and the Participant’s vested interest under any such other plan
shall be considered a vested interest under this Plan; provided, however, that
the provisions of this paragraph shall not be applied so as to allow the amount
of a loan to exceed the amount that would otherwise be permitted in the absence
of this paragraph.
Section 5
Benefit
Distributions
5.01 Benefit Distributions at Severance from Employment
or other Distribution Event. Except as
permitted under Section 3.06 (relating to excess Elective Deferrals), Section
5.04 (relating to withdrawals of amounts rolled over into the Plan), Section
5.05 (relating to hardship), or Section 8.3 (relating to termination of the
Plan), distributions from a Participant’s Account may not be made earlier than
the earliest of the date on which the Participant has a Severance from
Employment, dies, becomes Disabled, or attains age 59&1/2. Distributions
shall otherwise be made in accordance with the terms of the Individual
Agreements.
5.02 Small Account Balances. The terms of the Individual Agreement may permit
distributions to be made in the form of a lump-sum payment, without the consent
of the Participant or Beneficiary, but no such payment may be made without the
consent of the Participant or Beneficiary unless the Account Balance does not
exceed $5,000 (determined without regard to any separate account that holds
rollover contributions under Section 6.1) and any such distribution shall comply
with the requirements of section 401(a)(31)(B) of the Code (relating to
automatic distribution as a direct rollover to an individual retirement plan for
distributions in excess of $1,000).
5.03 Minimum Distributions. Each Individual
Agreement shall comply with the minimum distribution requirements of section
401(a)(9) of the Code and the regulations thereunder. For purposes of applying
the distribution rules of section 401(a)(9) of the Code, each Individual
Agreement is treated as an individual retirement account (IRA) and distributions
shall be made in accordance with the provisions of § 1.408-8 of the Income Tax
Regulations, except as provided in § 1.403(b)-6(e) of the Income Tax
Regulations.
5.04 In-Service Distributions from Rollover
Account. If a Participant has a
separate account attributable to rollover contributions to the plan, to the
extent permitted by the applicable Individual Agreement, the Participant may at
any time elect to receive a distribution of all or any portion of the amount
held in the rollover account.
5.05 Hardship Withdrawals.
(a) Hardship withdrawals shall be permitted
under the Plan to the extent permitted by the Individual Agreements controlling
the Account assets to be withdrawn to satisfy the hardship. If applicable under
an Individual Agreement, no Elective Deferrals shall be allowed under the Plan
during the 6-month period beginning on the date the Participant receives a
distribution on account of hardship.
(b) The Individual Agreements shall provide
for the exchange of information among the Employer and the Vendors to the extent
necessary to implement the Individual Agreements, including, in the case of a
hardship withdrawal that is automatically deemed to be necessary to satisfy the
Participant’s financial need (pursuant to § 1.401(k)-1(d)(3)(iv)(E) of the
Income Tax Regulations), the Vendor notifying the Employer of the withdrawal in
order for the Employer to implement the resulting 6-month suspension of the
Participant’s right to make Elective Deferrals under the Plan. In addition, in
the case of a hardship withdrawal that is not automatically deemed to be
necessary to satisfy the financial need (pursuant to § 1.401(k)-1(d)(3)(iii)(B)
of the Income Tax Regulations), the Vendor shall obtain information from the
Employer or other Vendors to determine the amount of any plan loans and rollover
accounts that are available to the Participant under the Plan to satisfy the
financial need.
5.06 Rollover Distributions.
(a) A Participant or the Beneficiary of a
deceased Participant (or a Participant’s spouse or former spouse who is an
alternate payee under a domestic relations order, as defined in section 414(p)
of the Code) who is entitled to an eligible rollover distribution may elect to
have any portion of an eligible rollover distribution (as defined in section
402(c)(4) of the Code) from the Plan paid directly to an eligible retirement
plan (as defined in section 402(c)(8)(B) of the Code) specified by the
Participant in a direct rollover. In the case of a distribution to a Beneficiary
who at the time of the Participant’s death was neither the spouse of the
Participant nor the former spouse of the Participant who is an alternate payee
under a domestic relations order, a direct rollover is payable only to an
individual retirement account or individual retirement annuity (IRA) that has
been established on behalf of the Beneficiary as an inherited IRA (within the
meaning of section 408(d)(3)(C) of the
Code)
(b) Each Vendor shall be separately
responsible for providing, within a reasonable time period before making an
initial eligible rollover distribution, an explanation to the Participant of his
or her right to elect a direct rollover and the income tax withholding
consequences of not electing a direct rollover.
Section 6
Rollovers to the Plan and
Transfers
6.01 Eligible Rollover Contributions to the
Plan.
(a) Eligible Rollover Contributions.
To the extent provided in the Individual Agreements, an Employee who is a
Participant who is entitled to receive an eligible rollover distribution from
another eligible retirement plan may request to have all or a portion of the
eligible rollover distribution paid to the Plan. Such rollover contributions
shall be made in the form of cash only. The Vendor may require such
documentation from the distributing plan as it deems necessary to process the
rollover in accordance with section 402 of the Code and to confirm that such
plan is an eligible retirement plan within the meaning of section 402(c)(8)(B)
of the Code. However, in no event does the Plan accept a rollover contribution
from a Roth elective deferral account under an applicable retirement plan
described in section 402A (e)(1) of the Code or a Roth IRA described in section
408A of the Code.
(b) Eligible Rollover Distribution.
For purposes of Section 6.1(a), an eligible rollover distribution means any
distribution of all or any portion of a Participant’s benefit under another
eligible retirement plan, except that an eligible rollover distribution does not
include (1) any installment payment for a period of 10 years or more, (2) any
distribution made as a result of an unforeseeable emergency or other
distribution which is made upon hardship of the employee, or (3) for any
distribution, the portion, if any of the distribution that is a required minimum
distribution under section 401(a)(9) of the Code. In addition, an eligible
retirement plan means an individual retirement account described in section
408(a) of the Code, an individual retirement annuity described in section 408(b)
of the Code, a qualified trust described in section 401(a) of the Code, an
annuity plan described in section 403(a) or 403(b) of the Code, or an eligible
governmental plan described in section 457(b) of the Code, that accepts the
eligible rollover distribution.
(c) Separate Accounts. The Vendor
shall establish and maintain for the Participant a separate account for any
eligible rollover distribution paid to the Plan.
6.02 Plan-to-Plan Transfers to the Plan.
(a) At the direction of the Employer, for a
class of Employees who are participants or beneficiaries in another plan under
section 403(b) of the Code, the Administrator may permit a transfer of assets to
the Plan as provided in this Section 6.02. Such a transfer is permitted only if
the other plan provides for the direct transfer of each person’s entire interest
therein to the Plan and the participant is an employee or former employee of the
Employer. The Administrator and any Vendor accepting such transferred amounts
may require that the transfer be in cash or other property acceptable to it. The
Administrator or any Vendor accepting such transferred amounts may require such
documentation from the other plan as it deems necessary to process the transfer
in accordance with § 1.403(b)-10(b)(3) of the Income Tax Regulations and to
confirm that the other plan is a plan that satisfies section 403(b) of the
Code.
(b) The amount so transferred shall be
credited to the Participant’s Account Balance, so that the Participant or
Beneficiary whose assets are being transferred has an accumulated benefit
immediately after the transfer at least equal to the accumulated benefit with
respect to that Participant or Beneficiary immediately before the
transfer.
(c) To the extent provided in the Individual
Agreements holding such transferred amounts, the amount transferred shall be
held, accounted for, administered, and otherwise treated in the same manner as
an Elective Deferral by the Participant under the Plan except that (1) the
Individual Agreement which holds any amount transferred to the Plan must provide
that, to the extent any amount transferred is subject to any distribution
restrictions required under section 403(b) of the Code, the Individual Agreement
must impose restrictions on distributions to the Participant or Beneficiary
whose assets are being transferred that are not less stringent than those
imposed on the transferor plan and (2) the transferred amount shall not be
considered an Elective Deferral under the plan in determining the maximum
deferral under Section 3.
6.03 Plan-to-Plan Transfers from the
Plan.
(a) At the direction of the Employer, the
Administrator may permit a class of Participants and Beneficiaries to elect to
have all or any portion of their Account Balance transferred to another plan
that satisfies section 403(b) of the Code in accordance with § 1.403(b)-10(b)(3)
of the Income Tax Regulations. A transfer is permitted under this Section
6.03(a) only if the Participants or Beneficiaries are employees or former
employees of the employer (or the business of the employer) under the receiving
plan and the other plan provides for the acceptance of plan-to-plan transfers
with respect to the Participants and Beneficiaries and for each Participant and
Beneficiary to have an amount deferred under the other plan immediately after
the transfer at least equal to the amount transferred.
(b) The other plan must provide that, to the
extent any amount transferred is subject to any distribution restrictions
required under section 403(b) of the Code, the other plan shall impose
restrictions on distributions to the Participant or Beneficiary whose assets are
transferred that are not less stringent than those imposed under the plan. In
addition, if the transfer does not constitute a complete transfer of the
Participant’s or Beneficiary’s interest in the Plan, the other plan shall treat
the amount transferred as a continuation of a pro rata portion of the
Participant’s or Beneficiary’s interest in the transferor plan (e.g., a pro rata
portion of the Participant’s or Beneficiary’s interest in any after-tax employee
contributions).
(c) Upon the transfer of assets under this
Section 6.03, the Plan’s liability t pay benefits to the Participant or
Beneficiary under this Plan shall be discharged to the extent of the amount so
transferred for the Participant or Beneficiary. The Administrator may require
such documentation from the receiving plan as it deems appropriate or necessary
to comply with this Section 6.03 (for example, to confirm that the receiving
plan satisfies section 403(b) of the Code and to assure that the transfer is
permitted under the receiving plan) or to process the transfer pursuant to
§1.403(b)-10(b)(3) of the Income Tax Regulations.
6.04 Contract and Custodial Account
Exchanges.
(a) A Participant or Beneficiary is
permitted to change the investment of his or her Account Balance among the
Vendors under the Plan, subject to the terms of the Individual Agreements.
However, an investment change that includes an investment with a Vendor that is
not eligible to receive contributions under Section 2 (referred to below as an
exchange) is not permitted unless the conditions in paragraphs (b) through (d)
of this Section 6.04 are satisfied.
(b) The Participant or Beneficiary must have
an Account Balance immediately after the exchange that is at least equal to the
Account Balance of that Participant or Beneficiary immediately before the
exchange (taking into account the Account Balance of that Participant or
Beneficiary under both section 403(b) contracts or custodial accounts
immediately before the exchange).
(c) The Individual Agreement with the
receiving Vendor has distribution restrictions with respect to the Participant
that are not less stringent than those imposed on the investment being
exchanged.
(d) The Employer enters into an agreement
with the receiving Vendor for the other contract or custodial account under
which the Employer and the Vendor will from time to time in the future provide
each other with the following information:
(1) Information necessary for
the resulting contract or custodial account, or any other contract or custodial
accounts to which contributions have been made by the Employer, to satisfy
section 403(b) of the Code, including the following:
(i) the Employer
providing information as to whether the Participant’s employment with the
Employer is continuing, and notifying the Vendor when the Participant has had a
Severance from Employment (for purposes of the distribution restrictions in
Section 5.1);
(ii) the Vendor
notifying the Employer of any hardship withdrawal under Section 5.5 if the
withdrawal results in a six month suspension of the Participant’s right to make
Elective Deferrals under the Plan; and
(iii) the Vendor
providing information to the Employer or other Vendors concerning the
Participant’s or Beneficiary’s section 403(b) contracts or custodial accounts or
qualified employer plan benefits (to enable a Vendor to determine the amount of
any plan loans and any rollover accounts that are available to the Participant
under the Plan in order to satisfy the financial need under the hardship
withdrawal rules of Section 5.5); and
(2) Information necessary in
order for the resulting contract or custodial and any other contract or
custodial account to which contributions have been made for the Participant by
the Employer to satisfy other tax requirements, including the
following:
(i) the amount of
any plan loan that is outstanding to the Participant in order for a vendor to
determine whether an additional plan loan satisfies the loan limitations of
Section 4.03, so that any such additional loan is not a deemed distribution
under section 72(p)(1); and
(ii) information
concerning the Participant’s or Beneficiary’s after-tax employee contributions
in order for a Vendor to determine the extent to which a distribution is
includible in gross income.
(e) If any Vendor ceases to be eligible to
receive Elective Deferrals under the Plan, the Employer will enter into an
information sharing agreement as described in Section 6.04(d) to the extent the
Employer’s contract with the Vendor does not provide for the exchange of
information described in Section 6.04(d)(1) and (2).
6.05 Permissive Service Credit Transfers.
(a) If a Participant is also a participant
in a tax-qualified defined benefit governmental plan (as defined in section
414(d) of the Code) that provides for the acceptance of plan-to-plan transfers
with respect to the Participant, then the Participant may elect to have any
portion of the Participant’s Account Balance transferred to the defined benefit
governmental plan. A transfer under this Section 6.05(a) may be made before the
Participant has had a Severance from Employment.
(b) A transfer may be made under Section
6.5(a) only if the transfer is either for the purchase of permissive service
credit (as defined in section 415(n)(3)(A) of the Code) under the receiving
defined benefit governmental plan or a repayment to which section 415 of the
Code does not apply by reason of section 415(k)(3)of the Code.
(c) In addition, if a plan-to-plan transfer
does not constitute a complete transfer of the Participant’s or Beneficiary’s
interest in the transferor plan, the Plan shall treat the amount transferred as
a continuation of a pro rata portion of the Participant’s or Beneficiary’s
interest in the transferor plan (e.g., a pro rata portion of the
Participant’s or Beneficiary’s interest in any after-tax employee
contributions).
Section 7
Investment of
Contributions
7.01 Manner of Investment. All Elective Deferrals or other amounts contributed to
the Plan, all property and rights purchased with such amounts under the Funding
Vehicles, and all income attributable to such amounts, property, or rights shall
be held and invested in one or more Annuity Contracts or Custodial Accounts.
Each Custodial Account shall provide for it to be impossible, prior to the
satisfaction of all liabilities with respect to Participants and their
Beneficiaries, for any part of the assets and income of the Custodial Account to
be used for, or diverted to, purposes other than for the exclusive benefit of
Participants and their Beneficiaries.
7.02 Investment of Contributions. Each Participant or Beneficiary shall direct the
investment of his or her Account among the investment options available under
the Annuity Contract or Custodial Account in accordance with the terms of the
Individual Agreements. Transfers among Annuity Contracts and Custodial Accounts
may be made to the extent provided in the Individual Agreements and permitted
under applicable Income Tax Regulations.
7.03 Current and Former Vendors. The Administrator shall maintain a list of all Vendors
under the Plan. Such a list is hereby incorporated as part of the Plan. Each
Vendor and the Administrator shall exchange such information as may be necessary
to satisfy section 403(b) of the Code or other requirements of applicable law.
In the case of a Vendor which is not eligible to receive Elective Deferrals
under the Plan (including a Vendor which has ceased to be a Vendor eligible to
receive Elective Deferrals under the Plan and a Vendor holding assets under the
Plan in accordance with Section 6.02 or 6.04) the Employer shall keep the Vendor
informed of the name and contact information of the Administrator in order to
coordinate information necessary to satisfy section 403(b) of the Code or other
requirements of applicable law.
Section
8
Amendment and Plan
Termination
8.01 Termination of Contributions. The Employer has adopted the Plan with the intention
and expectation that contributions will be continued indefinitely. However, the
Employer has no obligation or liability whatsoever to maintain the Plan for any
length of time and may discontinue contributions under the Plan at any time
without any liability hereunder for any such discontinuance.
8.02 Amendment and Termination. The Employer reserves the authority to amend or
terminate this Plan at any time.
8.03 Distribution upon Termination of the
Plan. The Employer may provide that, in
connection with a termination of the Plan and subject to any restriction
contained in the Individual Agreements, all Accounts will be distributed,
provided that the Employer and any Related Employer on the date of termination
do not make contributions to an alternative section 403(b) contract that is not
part of the Plan during the period beginning on the date of plan termination and
ending 12 months after the distribution of all assets from the Plan, except as
permitted by the Income Tax Regulations.
Section 9
Miscellaneous
9.01 Non-Assignability. Except as provided in Section 9.02 and 9.03, the
interests of each Participant or Beneficiary under the Plan are not subject to
the claims of the Participant’s or Beneficiary’s creditors; and neither the
Participant nor any Beneficiary shall have any right to sell, assign, transfer,
or otherwise convey the right to receive any payments hereunder or any interest
under the Plan, which payments and interests are expressly declared to be
non-assignable and non-transferable.
9.02 Domestic Relation Orders. Notwithstanding Section 9.01, in a judgment, decree or
order (including approval of a property settlement agreement) that relates to
the provision of child support, alimony payments, or the marital property rights
of a spouse or former spouse, child, or other dependent of a Participant is made
pursuant to the domestic relations law of any State (“domestic relations
order”), then the amount of the Participant’s Account Balance shall be paid in
the manner and to the person or persons so directed in the domestic relations
order. Such payment shall be made without regard to whether the Participant is
eligible for a distribution of benefits under the Plan. The Administrator shall
establish reasonable procedures for determining the status of any such decree or
order and for processing distribution pursuant to the domestic relations
order.
9.03 IRS Levy.
Notwithstanding Section 9.01, the Administrator may pay from a Participant’s or
Beneficiary’s Account Balance the amount that the Administrator finds is
lawfully demanded under a levy issued by the Internal Revenue Service with
respect to that Participation or Beneficiary or is sought to be collected by the
United States Government under a judgment resulting from an unpaid tax
assessment against the Participant or Beneficiary.
9.04 Tax
Withholding. Contributions to the Plan
are subject to applicable employment taxes (including, if applicable, Federal
Insurance Contributions Act (FICA) taxes with respect to Elective Deferrals,
which constitute wages under section 3121 of the Code). Any benefit payment made
under the Plan is subject to applicable income tax withholding requirements
(including section 3401 of the Code and the Treasury Regulations thereunder). A
payee shall provide such information as the Administrator may need to satisfy
income tax withholding obligations, and any other information that may be
required by guidance issued under the Code.
9.05 Payments to Minors and Incompetents. If a Participant or Beneficiary entitled to receive
any benefits hereunder is a minor or is adjudged to be legally incapable of
giving valid receipt and discharge for such benefits, or is deemed so by the
Administrator benefits will be paid to such person as the Administrator may
designate for the benefit of such Participant or Beneficiary. Such payments
shall be considered a payment to such Participant or Beneficiary and shall, to
the extent made, be deemed a complete discharge of any liability for such
payments under the Plan.
9.06 Mistaken Contributions. If any contribution (or any portion of a contribution)
is made to the Plan by a good faith mistake of fact, then within one year after
the payment of the contribution, and upon receipt in good order of a proper
request approved by the Administrator, the amount of the mistaken contribution
(adjusted for any income or loss in value, if any, allocable thereto) shall be
returned directly to the Participant or, to the extent required or permitted by
the Administrator, to the Employer.
9.07 Procedure When Distributee Cannot Be
Located. The Administrator shall make
all reasonable attempts to determine the identity and address of a Participant
or a Participant’s Beneficiary entitled to benefits under the Plan. For this
purpose, a reasonable attempt means (a) the mailing by certified mail a notice
to the last known address shown on the Georgetown Public Schools or the
Administrator’s records, (b) notification sent to the Social Security
Administration or the Pension Benefit Guaranty Corporation (under their program
to identify payees under retirement plans), and (c) the payee has not responded
within six months. If the Administrator is unable to locate such a person
entitled to benefits hereunder, or if there has been no claim made for such
benefits, the funding vehicle shall continue to hold the benefits due such a
person.
9.08 Incorporation of Individual
Agreements. The Plan, together with the
Individual Agreements, is intended to satisfy the requirements of section 403(b)
of the Code and the Income Tax Regulations thereunder. Terms and conditions of
the Individual Agreements are hereby incorporated by reference into the Plan,
excluding those terms that are inconsistent with the Plan or section 403(b) of
the Code.
9.09 Governing Law. The Plan will be construed, administered and enforced
according to the Code and the laws of the State of
Massachusetts.
9.10 Headings.
Headings of the Plan have been inserted for convenience of reference only and
are to be ignored in any construction of the provisions
hereof.
9.11 Gender.
Pronouns used in the Plan in the masculine or feminine gender include both
genders unless the context clearly indicates otherwise.
IN
WITNESS WHEREOF; the Employer has caused this
Plan to be executed on this __________ day of ________
2009.
Employer: Georgetown Public Schools
By:
___________________________________________
Title:
___________________________________________
Date Signed:
_____________________________________
Effective Date of this Plan:
__________________________
403(b) Service Provider
Agreement
This Agreement, effective as of the date hereof, by and
between Georgetown Public Schools (the “Employer”) and
, ("Service
Provider") sets forth the terms and conditions of the agreement between the
Employer and Service Provider relating to services provided by Service Provider
to the Employer in support of their 403(b) Retirement Plan (the "Plan"). The
parties intend that Service Provider, a
corporation, headquartered at
provide
certain services to the Employer, as needed, to support the 403(b) Retirement
Plan of the Employer. In furtherance of this intention, the parties agree to
the terms and conditions set forth hereafter:
DUTIES AND RESPONSIBILITIES OF SERVICE
PROVIDER. Service Provider shall be
responsible for the following:
1)
Qualified 403(b)
Accounts. Offer only tax sheltered
accounts that qualify as such under Section 403(b) of the Internal Revenue Code
of 1986, as amended from time to time, any regulations issued thereunder and any
other applicable state or federal law.
2)
Communications. Assist in communicating the Plan to eligible employees
of the Employer, which shall include, but shall not be limited to, presenting at
group meetings, responding to inquiries from eligible employees of the Employer,
and providing the Employer with informational material describing the
Plan.
3)
Informational
Materials. Prepare informational
written notice of availability of the Plan for the Employer to distribute to
employees as well as materials that will describe the 403(b), including possible
tax advantages and disadvantages, investment choices and procedures for
participating in the Plan.
4)
Forms. Prepare forms for enrollment and investment selection
for the 403(b) accounts to be established, including salary reduction agreement,
account application and beneficiary designation forms.
5)
Individual
Meetings. Provide through its
registered financial representatives, individual meetings with eligible
employees, upon request, to explain the Plan, the impact of participation on the
employee and to assist with the completion of necessary forms and related
documentation.
6)
On-Line Participant
Access. Provide employees on-line
access to their 403(b) 24 hours a day, seven days a week, unless there is a
catastrophic event beyond the control of Service Provider.
7)
Participant
Statements. Provide statements that
will be mailed to the home address of participants 15 business days after the
end of the quarter. Additionally, participant statements are available via the
secure Service Provider web site.
8)
Employer Plan
Reports. Prepare various reports for
the Employer on request, including information on the number of participants in
each fund and the amount of assets; beginning plan balance, contributions and
ending balance.
9)
Disburse Contributions
to 403(b) Account Investments.
Disburse all amounts received from the Employer to participants' 403(b) accounts
and investment choices selected by participants to receive the contributions
under the 403(b) plan. Such disbursement shall occur within 24 hours of receipt
from the Employer unless circumstances beyond the control of Service Provider
justify a later transmittal. In no event shall the disbursement occur later
than 72 hours of receipt.
10)
Confidentiality. Service Provider
agrees to keep confidential all information about participants and eligible
employees provided by the Employer. All matters relating to providing services
hereunder shall only be communicated to Service Provider representatives, the
Employer or its designated representative.
11)
Solicitation. Service Provider and its
representatives shall comply with all pertinent written directives regarding the
solicitation of employees of the Employer.
12)
403(b)
Provisions.
Service Provider agrees to the following:
a)
Properly calculate the
Maximum Allowable Contribution for employees who are utilizing the "catch-up"
provisions of 402(g)(7) and/or 414(v);
b)
Properly administer
loans;
c)
Provide tax reporting and
required notices to participants requesting distributions;
d)
Permit corrective distributions
of excess deferral contributions;
e)
Properly withhold and report
required federal taxes;
f)
Provide notification to
participants who are 70 1/2 of their Required Minimum
Distributions;
g)
Properly administer hardship
distributions including notifying the employer so that contributions may be
suspended for 6 months, if the employer adopts this provision of the hardship
distribution regulations;
h)
Properly administer
distributions and enforce distributions restrictions under Code Section 403(b).
Participant certification may be relied upon with respect to distributions
unless otherwise required by the Employer;
i)
Provide information to the
Employer relating to 403(b) accounts held by Service Provider for participants
in the event of an audit by the Internal Revenue Service, subject to written
authorization by the participant. For example:
i)
Annual listing of
total contributions, by fund or insurance product for the years under
audit;
ii)
Annual listing of all
participant distributions for the years under audit;
iii)
Annual listing of
outstanding participant loans for the years under audit;
iv)
Annual listing of any
participant defaulted loans for the years under audit;
v)
Copies of IRS tax
reporting (Forms 1099-R) for all distributions and defaulted loans for the years
under audit.
j)
DMENTS AND
TERMINATION
DUTIES AND RESPONSIBILITIES OF THE
EMPLOYER. The Employer shall be
responsible for the following:
-
Determining
Eligible Employees. Determining which
employees of the Employer are eligible to participate in the Plan and certify
that the 403(b) program will be made available to all eligible employees as
required under the terms of Code section 403(b)(12)(A)(ii).
-
Primary Contact
Person. Appointing a primary contact
person for purposes of implementing, administering and coordinating any issues
that may arise with respect to the Plan.
-
Transmit
Contributions. The required
contributions shall be transmitted to Service Provider in a time and manner
acceptable to both parties.
-
Provide
Information. The Employer agrees to furnish Service Provider,
as soon as practicable, any and all information, which Service Provider may
require in order to fulfill its duties under this
Agreement.
-
Eligible
Employer. The
Employer certifies that it qualifies under Section 403(b) of the Internal
Revenue Code of 1986, as amended, as an organization eligible to offer this
403(b) plan to its employees.
BOTH PARTIES AGREE
that the following terms and conditions are included as part of this
Agreement:
1.
Indemnification. Each party agrees to indemnify
and hold harmless the other party, including any individual member of the
governing boards, and their employees from every claim, demand or suit which may
arise out of, be connected with, or be made by reason of the other party’s
failure to meet the requirements of this Agreement. Notwithstanding the
preceding sentence, this indemnification shall not cover any claim, demand, or
suit based on erroneous or incomplete information provided by the Employer, its
employees, participants, or for any claim, demand, or suit based on the willful
misconduct or negligence of either party or its employees. Either party shall,
at its own expense and risk, defend, or at its option settle, any court
proceeding that may be brought against it, members of the governing board, and
employees on any claim, demand or suits covered by this indemnification, and
shall satisfy any judgment that may be rendered against any of them with respect
to any such claim or demand, provided that such party notifies the other party,
in writing, within twenty (20) business days of receipt of such claim or demand.
Each party’s liability hereunder shall be limited to actual damages and
out‑of‑pocket legal fees and expenses only.
2.
Exclusive Services. This Agreement is the
exclusive arrangement between the parties for services under the Plan and the
terms of this Agreement do not extend beyond such program. Neither party shall
have any other obligations or liabilities not specified herein unless both
parties agree to such additional obligations or liabilities in
writing.
3.
Not Legal Advice. The parties agree that no
service provided by the terms of this Agreement or under the Plan is to be
construed as individual legal or tax advice to participants.
4.
Term of the Agreement. This Agreement shall
continue from year to year unless terminated by either party, in writing, by no
less than a sixty (60) days written notice.
5.
Applicable Law. This Agreement shall be
construed under the laws of Massachusetts, unless pre-empted by federal law. Any
litigation with respect to the terms or conditions of the Agreement will be
conducted in the state of Massachusetts, and the parties agree that venue is
proper in Massachusetts.
6.
Severability. Each party agrees that it will
perform its obligations hereunder in accordance will all applicable laws, rules,
and regulations now or hereafter in effect. If any term or provision of this
Agreement shall be found to be illegal or unenforceable then, notwithstanding,
the remainder of this Agreement shall remain in full force and effect and such
term or provision shall be deemed stricken.
By executing this Agreement, dated
each
party acknowledges that it has read this Agreement and agrees to its terms.
AGREED TO:
Employer: Georgetown Public
Schools Service Provider:
Address: 51 North
Street
Address:
Georgetown, MA
01826
By: ________________________________ By:
_____________________________
Authorized
Representative Authorized
Representative
Title:_______________________________
Title: ___________________________
Adopted on: January 8, 2009