Minutes 07/27/1999 - Laserfiche WebLink

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July 27, 1999 · This change is consistent with provisions of the Virginia Retirement System. Financial Impact: · There is minimal financial impact to the City. The pension benefit paid is restored to the full amount, but no survivor pension liability will exist for a given employee, which reduces the long-term cost to the system. Motion by Mr. Whitehurst, and seconded by Mr. Moody, to adopt the following ordinance, and was adopted by the following vote: "AN ORDINANCE TO AMEND CHAPTER 30 OF THE CODE OF THE CITY OF PORTSMOUTH, VIRGINIA (1988) BY AMENDING SECTIONS 30-128(d) AND 30- 247(d) THEREOF PERTAINING TO THE REVOCATION OF THE JOINT AND LAST SURVIVOR OPTION UNDER THE PORTSMOUTH SUPPLEMENTAL RETIREMENT SYSTEM AND THE PORTSMOUTH FIRE AND POLICE RETIREMENT SYSTEM." Ayes: Benn, Griffin, Moody, Pitts, Robinett, Whitehurst Nays: None 99 - 171 - Adoption of a resolution to allow employees covered under the Virginia Retirement System (VRS) to purchase past service credit on a tax deferred basis. Recommendation: · Adoption of a resolution to allow employees covered under the Virginia Retirement System (VRS) to purchase past service credit on a tax deferred basis. Purpose and Need: · VRS has notified the locality that the Commonwealth has received a favorable ruling from the IRS to allow purchase of past service credit on a tax deferred basis. · In order to implement, the locality must adopt a resolution endorsing this option. · Many employees currently are buying back past service credit and this will allow employees the option to do so on a basis that reduces their federal taxable income. Financial Impact: · The financial impact to the City is favorable as this will reduce the amount paid by the City for FICA taxes because the taxable income of the employee is reduced by the amount being withheld for purchasing the past service credit. Motion by Mr. Benn, and seconded by Mr. Whitehurst, to adopt the following resolution, and was adopted by the following vote: "A RESOLUTION AUTHORIZING THE CITY OF PORTSMOUTH TO PICK UP THE EMPLOYEE'S CONTRIBUTION TO VRS FOR PAST SERVICE CREDIT UNDER §414(h) OF THE INTERNAL REVENUE CODE. WHEREAS, the City of Portsmouth desires to provide its employees with tax deferral pursuant to §414(h) of the Internal Revenue Code with respect to their member contributions to the Virginia Retirement System, the State Police Officers Retirement System and the Judicial Retirement System (collectively referred to as VRS) for the permissible purchase of past service credit by picking up member contributions to the VRS; and WHEREAS, the pick up is authorized under Virginia Code Sections 51.1-142.1 and 51.1-143.C.; WHEREAS, the VRS keeps track of such picked up member contributions, and is prepared to treat such contributions as employee contributions for all purposes of VRS;