DATE: February 24, 2016
TO: Board of Mayor and Aldermen
FROM: Eric Stuckey, City Administrator
Shirley Gower, Human Resources Director
Russ Truell, Assistant City Administrator
SUBJECT:
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Consideration of Resolution 2016-12, a Resolution to Authorize Adoption of Revised ICMA Retirement Plan & Trust Agreements (03-10-16 Budget & Finance 3-0)
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Purpose
The purpose of this memo is to provide information to the Franklin Board of Mayor and Aldermen (BOMA) concerning the adoption of revised agreements with ICMA Retirement Corporation.
Background
The City of Franklin has two agreements with ICMA-RC regarding 401 defined contribution plans. Those agreements cover the original 401a plan for employee retirement savings adopted in 2002, and another 401a plan adopted in 2010 to cover those employees employed after February 15, 2010.
Periodically, such plans require revisions to incorporate new federal laws that are passed, case law decisions that have occurred, and changes in the guidelines provided by the Internal Revenue Service for tax-deferred defined contribution plans. ICMA-RC has modified the Plan & Trust agreement to incorporate those changes, and the revised plans are now ready for adoption.
Financial Impact
There is no financial impact involved in adopting or failing to adopt the revised plans. However, the liability coverage provided by ICMA-RC will not be available to the City and its employees if plans are not kept in line with current law.
Recommendation
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Staff recommends approval of the resolution to authorize adoption of the revised plans.