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<br />September 9. 2008 <br /> <br />Financial Impact: <br />. There is no additional financial impact as a result of this resolution. <br /> <br />Staff Recommends: <br />Adoption of the resolution. Vision Principle Advanced: Pride of Past, Promise of <br />Future. <br /> <br />Next Steps Following Council Action: <br />. If adopted by City Council, resolution will be submitted to VRS. <br /> <br />Motion by Mr. Heretick, and seconded by Ms. Psi mas, to adopt the following <br />resolution, and was adopted by the following vote: <br /> <br />"RESOLUTION AFFIRMING AUTHORIZATION FOR THE CITY OF PORTSMOUTH <br />TO PICK UP THE EMPLOYEE'S CONTRIBUTION TO THE VIRGINIA RETIREMENT <br />SYSTEM. <br /> <br />WHEREAS, the City of Portsmouth provides its employees with tax deferral <br />pursuant to S 414(h) of the Internal Revenue Code with respect to their member <br />contributions to the Virginia Retirement System ("VRS") by picking up member <br />contributions to VRS; and <br /> <br />WHEREAS, VRS keeps track of such picked up member contributions, and <br />treats such contributions as employee contributions for all purposes of VRS; <br /> <br />WHEREAS, the Internal Revenue Service in Notice 2006-43 has provided <br />transition relief for existing pick up arrangements provided that an authorized person or <br />entity takes formal action to evidence the establishment of the pick-up arrangement no <br />later than January 1, 2009. <br /> <br />WHEREAS, in order to avail itself of the protection given under Notice 2006-43, <br />the City of Portsmouth desires to affirm its intention to establish and maintain a pick-up <br />arrangement through formal action by the City Council. <br /> <br />NOW THEREFORE BE IT RESOLVED by the Council of the City of Portsmouth, <br />Virginia: <br /> <br />1. That the existing member contribution pick-up arrangement is hereby <br />affirmed as it relates to salary reduction elections in effect prior to the date of this <br />Resolution; <br /> <br />2. That, effective the first pay day on or after September 9, 2008, the City of <br />Portsmouth shall pick up member contributions of its employees to VRS, and such <br />contributions shall be treated as employer contributions in determining tax treatment <br />under the Internal Revenue Code of the United States; <br /> <br />3. That such contributions, although designated as member contributions, <br />are to be made by the City of Portsmouth in lieu of member contributions; <br /> <br />4. That pick up member contributions shall be paid from the same source of <br />funds as used in paying the wages to affected employees; <br /> <br />5. That member contributions made by the City of Portsmouth under the pick <br />up arrangement shall be treated for all purposes other than income taxation, including <br />but not limited to VRS benefits, in the same manner and to the same extent as member <br />contributions made prior to the pick up arrangement; <br /> <br />6. That nothing herein shall be construed so as to permit or extend an option <br />to VRS members to receive the pick up contributions made by the City of Portsmouth <br />directly instead of having them paid to VRS; and <br />