HomeMy WebLinkAboutReso 2006-995
RESOLUTION NO. 2006- ~
A RESOLUTION OF THE CITY COMMISSION OF THE
CITY OF SUNNY ISLES BEACH, FLORIDA, ADOPTING
THE V ANT AGECARE RETIREMENT HEAL TH SAVINGS
(RHS) PLAN AS A VOLUNTARY EMPLOYEE BENEFIT
WITH THE ICMA RETIREMENT CORPORATION,
ATTACHED HERETO AS EXHIBIT "A"; APPROVING
THE TRUST AGREEMENT, ATTACHED HERETO AS
EXHIBIT "B"; AUTHORIZING THE CITY MANAGER TO
DO ALL THINGS NECESSARY TO EFFECTUATE THE
TERMS OF THIS RESOLUTION; PROVIDING FOR AN
EFFECTIVE DATE.
WHEREAS, the City of Sunny Isles Beach currently maintains a 401 a Retirement Plan
through the ICMA Retirement Corporation for those employees who in November 2002 chose
not to join the Florida Retirement System; and
WHEREAS, the VantageCare Retirement Health Savings (RHS) Plan may be offered to
all City employees as a voluntary benefit at no cost to the City; and
WHEREAS, the establishment of a retiree health savings plan for employees serves the
interests of the City by enabling it to provide reasonable security regarding employees' health
needs during retirement, by providing increased flexibility in its personnel management system,
and by assisting in the attraction and retention of competent personnel; and
WHEREAS, the City has determined that the establishment of the retiree health savings
plan serves the above objectives, and wishes to adopt the VantageCare Retirement Health
Savings (RHS) Plan, attached hereto as Exhibit "A; and
WHEREAS, the City wishes to enter into a Trust Agreement with ICMA Retirement
Corporation, attached hereto as Exhibit "B", for the VantageCare Retirement Health Savings
Plan.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE
CITY OF SUNNY ISLES BEACH, FLORIDA, AS FOLLOWS:
Section 1. Adoption of Plan. The VantageCare Retirement Health Savings (RHS) Plan with
the ICMA Retirement Corporation, attached hereto as Exhibit "A", be and the same, is hereby
approved.
Section 2. Approving Trust Agreement. The City Commission hereby approves the Trust
Agreement, attached hereto as Exhibit "B".
Section 3. Authorization of City Manager. The City Manager is hereby authorized to do all
things necessary to effectuate the terms of this Resolution.
Section 4.
Effective Date. This Resolution will become effective upon adoption.
R2006- ICMA VantageCare Retirement Plan
Page 1 of2
PASSED AND ADOPTED this 19th day of October 2006.
'-
ATTJ):ST:', f
,I .0..
:~~:~
Jane A. Hines, ~MC, City Clerk
"
~~
.,
~:. .. r
APPROVED AS TO FORM AND
LEGAL UFFICIENCY
)
I
Moved by: C~T(bL<tSI~
Seconded by: [i~~~ Tl4M-r ~
Vote: 5-0
Mayor Norman S. Edelcup
Vice Mayor Roslyn Brezin
Commissioner Gerry Goodman
Commissioner Danny Iglesias
Commissioner Lewis Thaler
l/(Y es)
0..Y es)
~Y es)
l/(y es)
~Yes)
_(No)
_(No)
_(No)
_(No)
_(No)
R2006- ICMA VantageCare Retirement Plan
Page 2 of2
To:
Via:
From:
Date:
Re:
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Florida 33160
City Commission
Norman S. Edelcup, Mayor
Roslyn Brezin, Vice Mayor
Lewis J. Thaler, Commissioner
Gerry Goodman, Commissioner
Danny Iglesias, Commissioner
(305) 947-0606 City Hall
(305) 949-311 3 Fax
(305) 947-2150 Building Department
(305) 947-5107 Fax
A John Szerlag, City Manager
Hans OUinot, City Attorney
Jane A. Hines, City Clerk
MEMORANDUM
The Honorable City Commission
A. John Szerlag, City Manager
~_..
Thomas J. Acquaro, Human Resources Director
October 6, 2006
Vantage Care Retirement Health Savings (RHS) Plan Benefit
RECOMMENDATION:
It is recommended that the City Commission approve the attached resolution approving the
adoption of the VantageCare Retirement Health Savings Plan as a voluntary employee benefit with
the ICMA-Retirement Corporation.
BACKGROUND:
The City currently maintains a 401a Retirement Plan through the ICMA Retirement Corporation
(ICMA-RC) for those employees who, in November 2002, chose not to join the Florida Retirement
System. Through the ICMA-RC, the VantageCare Retirement Health Savings (RHS) Plan may be
offered to all City employees as a voluntary benefit at no cost to the City. This pre-tax benefit
helps employees save for future health care expenses on a tax-advantaged basis. The VantageCare
RHS Plan is a tax-advantaged investment savings plan dedicated strictly to funding health care costs
such as health care premiums. RHS allows employees to accumulate assets now to pay, on a tax-free
basis, for medical expenses incurred later. Some of the benefits of the RHS plan include: tax-free
contributions and tax-free investment growth; tax-free medical expense reimbursements;
Vantagepoint Mutual Funds that provide employees with a full range of investments; quarterly
account statements; no forfeiture of assets upon death-assets are passed along to beneficiaries for
their medical expenses; and experienced health benefit claims processing. The attached summary of
plan provisions provides information on the details of this RHS voluntary benefit.
Agenda Item \ 0 C-
Date I () -\q - D~
VANTAGECARE RETIREMENT HEAL TH SA VINGS PLAN
ANNOUNCEMENT LETTER
Dear Employee:
We are very pleased to inform you that you are eligible to participate in our
Vantage Care Retirement Health Savings (RHS) Plan: a benefit provided through the
ICMA Retirement Corporation (ICMA-RC) that gives you tools to help you save for
healthcare expenses on a tax-advantaged basis.
All of the information contained in the accompanying Employee Enrollment Kit is very
important. Most of your questions may be answered by referencing the Vantage Care
Retirement Health Savings Employee Question and Answer Brochure included in the
Enrollment Kit. There are, however, individual features that have been selected for our
plan that are detailed in the attachment to this letter. Please keep this announcement
letter with your other benefits information so that yOU may refer to it as needed. You
should also read carefully the forms that you will be given for enrollment.
What is VantageCare RHS?
The VantageCare Retirement Health Savings Plan (RHS) is a tax-advantaged
investment plan dedicated to funding one of your most significant financial exposures --
healthcare costs. RHS allows you to accumulate assets now to pay, on a tax-free basis,
for medical expenses you incur later.
Some of the benefits of RHS include: tax-free contributions and tax-free investment
growth; tax-free medical expense reimbursements; Vantagepoint Mutual Funds. that
provide you with a full range of investments; quarterly account statements; no forfeiture of
assets upon your death - the assets are passed along to your survivors for their medical
expenses; and experienced health benefit claims processing.
The attached summary of plan provisions provides information on the details of your
RHS plan. Any additional questions can be directed to your benefits office.
.. Please consult the current Vantagepoint Funds prospectus carefully for a complete summary of all fees,
expenses, charges, financial highlights and investment objectives, risks and performance information prior to
investing any money. Vantagepoint securities are distributed by ICMA-RC Services LLC, a broker dealer
affiliate of ICMARC, member NASD/SIPC. For a current prospectus, contact ICMA-RC Services LLC, 777
North Capitol Street NE, Washington, DC 20002-4240. 1-800-669-7400. En Espanolllame aI1-800-669-
8216. www.icmarc.ora.
VantageCare RHS - It's a benefit for you
that can last a lifetime
VantageCare Retirement Health Savings Plan
Summary of Plan Provisions
RHS Plan Information:
Plan Name: City of Sunny Isles Beach Retirement Health Savings Plan
Plan Number: To Be Determined
Effective Date: October 1, 2006
Participation:
All City employees are eligible to participate. Election to participate in the
plan is voluntary. Once participation is elected, an employee may not
choose to opt out.
Contributions:
The following contribution types are available in the City's RHS plan:
1. Direct Employer Contributions: (not at this time).
2. Elective Pre- Tax Contributions from: The City will submit an employee's
elected contribution amount on their behalf. The amount elected may be
1 % to 100% of earnings for the Plan Year. An employee will nave a 60-
day election window from their date of initial eligibility to make their
election to contribute. Contributions may begin no earlier than the
calendar month following the end of the election window. If an employee
does not make an election in their first year of eligibility, they have an
ongoing option to make an election at a future date. An annual election
window of 60 days will be provided during which the election may be
made. This window is available from October 1 through November 29
each year. Contributions may begin no earlier than the calendar year
following the year of election. (Note: Once an employee chooses to make
irrevocable pre-tax contributions from compensation, they will not be able
to change the amount or discontinue the contributions.)
3. Elective Pre- Tax Contributions of Accrued Leave: The City may contribute
vacation, sick leave, and compensatory time contributions on an
employee's behalf. There are no limits on the amount of accrued vacation
leave or compensatory time an employee may contribute. The total
amount of sick leave that may be contributed by an employee is limited
based on the City's existing sick leave pay-out policy, Le., a non-exempt
employee with less than three years service may not contribute sick leave
until three years service is attained and then only up to 10% of the
employee's current sick leave balance may be contributed (see attached).
Employees have a 60-day election window from the date of their initial
eligibility to make an election to contribute. Contributions may begin no
earlier than the calendar month following the end of the election window.
If an employee does not make a contribution in the first year of eligibility,
they have an ongoing option to make an election at a future date. An
annual election window of 60 days will be provided during which the
election may be made. This window is available from October 1 through
November 29 each year. Contributions may begin no earlier than the
calendar year following the year of the election. (Note: Once an
employee chooses to make irrevocable pre-tax contributions of accrued
leave, they will not be able to change the amount or discontinue the
contributions.)
4. Annual Prospective Election for Pre- Tax Contributions of Leave: Sick and
vacation leave accrued in the next calendar year may be contributed to
the Plan on the employee's behalf. The total amount of sick leave that
may be contributed by an employee is limited based on the City's existing
sick leave pay-out policy, i.e., a non-exempt employee with less than three
years service may not contribute sick leave until three years service is
attained and then only up to 10% of the employee's current sick leave
balance may be contributed (see attached). Contributions of future leave
accruals will be remitted as earned. An annual election window of 60 days
will be provided during which the election to contribute leave to be accrued
in the next calendar year may be made. The election window will run from
October 1 to November 29. Contributions may begin no earlier than the
calendar year following the year of the election.
Limits on Total Contributions
There is no overall limit on the percentage or dollar amount of earnings that may
be contributed each year. However, the City's RHS Plan may place limits on
each contribution type as indicated above in the Contributions Section.
Vesting Schedule
1. Direct Employer Contributions: (none at this time)
2. Employee's Elective Pre-Tax Contributions are 100% vested at all times.
Benefits
Healthcare Benefits: An employee is eligible to receive medical expense benefits
upon retirement with the City. If the employee terminates employment prior to
retirement with the City, then they will receive benefits immediately upon
separation from service. The definition of retirement is an employee who meets
the age and service eligibility requirements of the City's retirement plan (FRS or
ICMA, whichever is pertinent). Medical expenses eligible for reimbursement
consist of all medical expenses eligible under Internal Revenue Code Section
213, other than direct long-term care expenses. Amounts paid from an
employee's account to reimburse an employee for qualifying medical expenses
will be tax-free.
Death Benefits: In the event of an employee's death, their account will be
transferred to the surviving spouse and/or surviving eligible dependents for
continuing tax-free healthcare benefits. If no spouse or eligible dependent
survives the employee, the account balance will remain available to the next-
named beneficiary for continuing healthcare benefits. Benefits paid to non-
spouse, non-dependent beneficiaries may be subject to income taxation, Upon
the death of an employee's spouse, all dependents, and all named beneficiaries,
any remaining assets will revert to the City.
HRD 9/5/06
7) Accumulated Sick Leave:
a) Employees who are eligible to accrue sick leave may accumulate a
maximum of up to 1,200 hours. Upon termination of employment,
eligible employees will receive compensation tor a percentage of
unused accumulated SIck leave as follows:
% of unused
Employee Length of service accumulated sick
leave to be paid
out
Exempt Any 75%
Non-Exempt 20 or more years of service 75%
Non-Exempt 10 or more years of service 50%
Non-Exempt 5 or more years of service 25%
Non-Exempt 3 or more years of service 10%
b) At the end of each calendar year, typically in December, or at
separation, any banked sick leave above the previous year's
banked amount will be calculated, by the Finance Department, at
the employee's rate of pay in effect at the time the sick leave was
earned or accumulated.
FORMS:
Time Off Request/Report Form (HRD)
703_1 sick leave
Page 3 of 3
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ICM/\ '
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Funding vehicle 1 Integral Parr Trust j
------.-------l-----..----..-...------.-..----.--.-----~I-.-..-----.-
I. I
Legal basis I IRS rulIngs, and Treas. Reg. 301.7701-1
l(a)(3) f
1--._________ ___.__..._.__________.___1.__.._..__..__.___
Parricipation I Employer (or Collective Bargaining I,
I Unit) chooses:
I 1) Mandatory participation
I 2) Irrevocable election by member of
I covered group
- ..----.--------1'-.-.--------.
Types of direct employer I Flat dollar contributions I
contributions Percentage of salary contributions !
--.- -.---..-..-..-t-.------.-...------.-------t----.
Income tax treatment of employer coni Pre-tax I
tributions ! I
Types of employee comriburions I . 0 Sick, vacation, and oth~~-:-c~rued leavX-----.
(Pre-tax contributions are treated as : on a mandatory formula basis I
employer contributions for tax purposest . 0 Pre-tax mandatory contributions from I
1 compensation I
I .0 Elective irrevocable pre-tax contribu- I
I tions from compensation I
II . 0 Elective irrevocable pre-tax contribu- I
tions from accrued leave I
I
.0 Annual prospectively elected I
I' I,'
contribution of accruing sick,
vacation, and/or other leave
I
I .. Voluntary after-tax contributions
I
1----. --...---...--.,-.---
Income tax treatment of employee con-I Pre-tax except for voluntary after-tax I'
tributions I contributions
h...n -----..----1-___._______._..__....___._____....._._._.._.__ ___.__.. .. .._. ,___,__._.
FICA treatment of employer and I No FICA (OASDI or Medicare) I
employee contributions I payable except that after-tax I
i voluntary employee contributions sub-,
! ject to FICA I
...--------.. -- . --..-..L..--.-__________.___.___.____l....___._..
A I 'b" i N I' . 'b' I
nllua contn utlon maxImum ! .0 0 tmtt on 'pre-tax contn Uflons I
i (employer may impose limit) ,
! I
I' .0 After-tax contributions limited to 2501
of total contributions
--------.--..-----.-..-. ..- ._.____....J._ --.-------_.____.__.____._.._..___..._.______.. ....... _.. .__.n....
, I
Annual contribution minimum i No contribution minimum at I
_ ... _ _____ I_P"~:'p~~_o,PlanleVel________I---_-_-
, I
Vesring on direct employer contriburions I Employer determines; can be immediate i
i !
i .... .. .1..
-----.---- .. .---..--- ---"-"-~'-'-'~-'--'''---''--l-'----- - ."-- -----..-- -- .--. -_. -.-.. ------- .-. ----------0 --_ :--0-.-----
Types of benefits allowed i . Health 1
: · De minimis ,
I I
---.----.-..-.-..--.-- --.-------.-t-..--.- . ...-.- _..........______.__.........._._...____...._.h__..______.__.
Eligible Medical Benefits I Default in Adoption Agreement: I
I' · All IRC ~213 medical expenses
(except long-term care expenses) OR
I Employer (or Collective Bargaining
I Unit) selecrs any combination of the
following:
'. Insurance premiums
· Out-of-pocker expenses
· Medicare Parr B premiums
· Medicare Supplemental
Insurance premiums
COBRA premiums
Dental insurance premiums
Vision insurance premiums
Long-term care premiums
Prescription drug insurance
Prescription drug expenses
Orher medical expenses (IRC
~213) as defined by Employer or
Collective Bargaining Unit
.--.----- ---...---.------...--- ....----/------.--....-.
I As outlined in plan.. can be linked to I
i age, retirement, separation from servo, '.
I ice, or years of service I
-..--- --...T---.----.----------h-.---.-.---------.--
Tax rrearment of health benefits I Tax-free !
Payment sched-~i~..-------------II--AS pai~~nt-~Th-~~~h.-b~~;;_fi~s is-------I- ..-
required
.___._____.___._n___.____.___ ._._1.---___.._.______.______________
I Balance remains available for use by
surviving spouse and dependents (non-
I taxable); if none or lasr of rhese dies,
i_~amed beneficiary may use for health
expenses (taxable)
______~______d___ .__~___ ___________________.__
De minimis account distriburion level Standard de minimis account
I balance is $5,000 if parricipant
I separates before eligibility for
! benefits. Employer can establish a lower
I level if desired.
-----....-..------.--.-.- . ..-------'1"-..-----------.--------
i
I
I
I
i
,
i
i
I
Rto
. ;~ct
~tJft~,.0P~:~\j~~~i~~\t'yf:,{?,1,C~:;l~~~:I/t~rt~;-
r';;tl1~:,[)il~J\J~<'C\.:.~;,(!1 tJI I!. r~b~Ik~(,l. n
.'''~~''~: [{~p;~':.({~:::!~~'::~:..(;.~:~:~':: ttfE:2J~i;~: '.: ~{-:~.:;:~_~ ;:~'.(t~.<~~.~~
I .
I ·
I ·
I
, .
!
f .
!
i ·
I
I .
Earliesr benefir eligibility date
Survivor benefits
_1... - .J
f~~Dtive Program .
I
I
I
I
I
I
I
I
!
I
i
I
I
I
i
i
j
,
i
I
Non-discrimination requirements
Apply to self-insured, non-collectively
bargained plans; results in "excess bene-
fits" being treated as compensation to
highly compensated participants
(continued on bock)
, i-;'1~ IJ;o: 4
Pr~p~ '
-t. ..Jr.
Fees
No employer plan fee
Employee annual fees (charged quar-
terly):
· $30 account fee plus
· 30 or 40 bps ( based on employers average i
per participant 457/401 account assets "vich i
ICMA-RC) :
. '-'---"-'~'--------------'---------._---_.p ,-_.-.--_..._--"-
Assets subject to claims of employer's i No
creditors?
- .-----.-~ ----.t---..------.. ..--.--~...---..-------.- --.--.--------.-------.--------.-.---~
Plan documents required : Trust Agreement, ,
: Ordinance/Resolution, RHS Adoption I
J Agreement, Welfare Plan Document I
---......---.---;---.-----..-----.----+----..-....-..--.-------
i. Nineteen funds: money market fund I
Investment Options (default); income preservation fund; I
five portfolio funds; five index funds; I
seven actively managed funds I
I
!
I
,
,. Pkau amsult: the current Vantagepoint Funds prospectus carefUI!;- for a complete summar)' of all fees, expenses, charges. financial highlights
anti investme:nt objectives, risks and performance information prior to investing an)' monq Vantagepoinr securities tire distributed 11;'
leMA-ReSer-vices LLC, a broker dealer affiliate of IClvfA-RC, member NASD/SIPC. For a current prospectus, contacr ICl\1A-RC Services
Uc, 777 Morel, Capit-oi Stmr l~E,Wa.shington. DC 20002-4240. 1-800-669-7400.
IC~
ICMA RETIREMENT CORPORATION
777 NORTH CAPITOL STREET, NE
WASHINGTON, DC 20002-4240
1-800-669-7400
PARA ASISTEHCIA EN ESPANOL LLAME AL
1-800.669-8216
WWW.lCMARC.ORG
BRCOOO-l17 -D604,36-C923
,J-b+ )-t"tY' 7?DO
~\
,..; ,:'~,.i.: . \
I qJ.:'~ A,..., "
'.~.1-.Y "/L' '(. '. ....
VANTA.u-t(tJ\:R-Eie" REfJ R'EM1J'JTT HEl\lffi{ SAVJ NG:S:: ~ li\"N;~
I N,Uf(':TKil![J.t1Tj:"(lDT!fnu,r;:-'
. 'Y,' 0-. 1 Ylt:I 'fJ U l~trd I UJl~)
...., .&ii:J,Jjrig R,.irrmtrll Srcurity
/,\ iMtJlro'fltAhril.:fJJf1..:hd
Money Market Fund' . .
f !Jf\lh(i-~~b
MW
Vtintog~ppiri'JMode6Po'ctibli{j J uods~~
S6~irig~){)'rle(}tedl. j I( Code. SF)
5% International Fund ~
10% Growth & Income Fund ~ .
10% Equity Income Fund ___ _ 35% Short.Term
"Bond Fund
30% (ore Bond ~
'""" food - . . -'~ 10' US Go,"...",
- Securities Fund
6 ::UiiliimJs
Short-Term Bond Fund ....................................................... MB
Core Bond Index Fund ....................................................... WM
US Government Securities Fund ......................................... MT
BebMaddi,id][ls
Asset Allocation Fund .......................................................... MP
Savings Oriented Model Portfolio Fund ................................ SF
Conservative Growth Model Portfolio Fund ......................... SG
Traditional Growth Model Portfolio Fund ............................ SL
Long-Term Growth Model POrtfolio Fund.......................... SM
All-Equity Growth Model Portfolio Fund ............................. SP
VP Milestone Retirement Income Fund ................................ 4E
VP Milestone 2010 Fund ..................................................... CA
VP Milestone 2015 Fund .................................................... CH
VP Milestone 2020 Fund ...................................................... CJ
VP Milestone 2025 Fund .................................................... CN
VP Milestone 2030 Fund ..................................................... CR
VP Milestone 2035 Fund .................................................... CU
VP Milestone 2040 Fund ..................................................... CX
L hLS~~lblt.Jr..tl(l~
Equity Income Fund ........................................................... MM
500 Stock Index Fund .......................................................... WJ
Growth & Income Fund ....................................................... MJ
Broad Market Index Fund .................................................. WG
Growth Fund ...................................................................... MG
Mid/Small Company Index Fund ....................................... WD
Aggressive Opportunities Fund ............................................ MA
1r.lt'l!D~DOO5tC4~jlJ~ils
Overseas Equity Index Fund ................................................ '\<'13
International Fund .............................................................. MD
(6.0&.68futiMe-LGtbv.n.Jf~~ '(Code. SG)
5% Aggressive Opportunities
Fund
B% Growth Fund
10% Growth & Intome
Fund
10% Equity Income Fund\~~
7% International Fund
,--- 30% Short. Term
Bond Fund
30% (ore Bond
Index Fund
T dld~iOnaLGr})wtM~( Code Sl)
10% International Fund
10% Aggressive
Opportunities Fund
~
15% Growth Fund
- 20% (ore Bond Index Fund
15% Growth &
Income Fund
Equity Income Fund
L~og~JemlilGfowtJj~j (Code S'M)
I J An investment in the Money Market Fund is not insured or guaranteed by the
,. Federal Deposit Insurance Corporation (FDIC) or any other government agency
Although the Fund seeks to maintain the value of your investments at $1.00 per
share; it is possible to lose money by investing in this Fund.
12% Internotionol Fund
.. . 20% (ore Bond Index Fund
15% Aggressive
Opportunities Fund -
,...
.- 13% Equity Income
Fund
20% Growth Fund
20% Growth &
Income Fund
Please note: A redemption fie may be assessed when you sell shares within certain
mutual fUnds. Please refer to the funds prospectus fOr further details.
, I!
I Please consult both the current Vantagepoint Funds prospectus and Making Sound I
Investment Decisions: A Retirement Investment Guide carefully fOr a complete
summary of all fies. expenses, charges, financial highlights and investment objectives.
risks and performance infOrmation prior to investing any money. Vantage point
securities are distributed by ICMA-RC Services LLe a broker dealer affiliate of
ICMA-RC. member NASD/SIPC For a current prospectus, contact ICMA-RC
Services LLe. 777 North Capitol Street NE. Washington. DC 20002-4240. 1-800
669-7400. En Espanolllame all-800-669-8216. www.icmarc.org.
Anft<iqil~1Gfuw~h~ .( (ode SP)
'15% 1nternationol Fund
20% Aggressive
Opportunities
Fund
15% Equity Income Fund
~../
"
---;-u. 20% Growth &
Income Fund
I
30% Growth Fund
FlYOOO-051-200504.C328
MUNt(MAKKITHJNU
MONEY MARKET FUND
Type of Investment Portfolio: Money marker and a
variety of shorr-rerm. fixed income securiries
Historical Volatility: Low
BOND FUNDS
SHORT. TERM BOND FUND
Morningstar Category: Shorr-Term Bond
Type of Investment Portfolio: A diversified
portfolio of deb! securiries payable primarily in U.S.
dollars and by normally maintaining an average
portfolio maturiry berween one and rhree years
Historical Volatility: Low; NAV stablized by
wrapper agreements
CORE BOND INDEX FUND
Morningstar Category: Intermediare-Term Bond
Type of Investment Portfolio: Bonds are chosen ro
replicate the characrerisrics of rhe Lehman Brothers
Aggregate Bond Index
Historical Volatility: Moderate; subject ro changes
in interest rates
US GOVERNMENT SECURITIES FUND
Moming3tar Category: Intermediate Government
Type of Investment Portfolio: U.S. Treasury and
agency securities
Historical Volatility: Low ro moderate; subject to
changes in interest rates
BALANCED FUNDS
ASSET ALLOCATION FUND
Morningstar Category: Moderate Allocation
Type of Investment Portfolio: Srocks, bonds, and
cash in proporrions determined by the subadviser's
assessment of market conditions
Historical Volatility: Moderate
MILESTONE FUNDS
The eight Milestone Funds seek a different degree of
potential risk and return by diversifying among
various Vantagepoint Funds in differing allocations.
These funds are designed to allow invesrors ro select
one fund that offers asset allocation, fund selection,
and rebalancing appropriate for their respective time
period of invesrment.
U~S-:-STOCnUNDS
EQUITY INCOME FUND
Morningstar Category: Large Value
Type of Investment Portfolio: Common stocks of
wcll-establishcd companics thar pay dividends
Historical Volatility: Modcrare
500 STOCK INDEX FUND
Morningstar Category: Carge Blcnd
Type of Investment Portfolio: Stocks arc chosen ro
fully rcplicare the Srandard & Poor's 500 Index
Historical Volatility: Moderate
GROWTH & INCOME FUND
Morningstar Category: Large Blend
Type of Investment Portfolio: Common stocks of
companies with rhe potential for capital appreciation
and secondarily, dividend-paying stocks
Historical Volatility: Average
BROAD MARKfT INDEX FUND
Morningstar Category: Large Blend
Type of Investment Portfolio: Srocks are choscn ro
replicate the characteristics of the DJ Wilshire 5000
Index
Historical Volatility: Moderate ro above average
GROWTH FUND
Morningstar Category: Large Growth
Type of Investment Portfolio: Common srocks of
companies wirh above-average potential for growth
Historical Volatility: Above average
MID/SMALL COMPANY INDEX FUND
Morningstar Category: Mid-Cap Blend
Type of Investment Portfolio: Srocks are chosen ro
rcplicate the characrerisrics of the DJ Wilshire 4500
Index
Historical Volatility: Significant
AGGRESSIVE OPPORTUNITIES FUND
Morningstar Category: Mid-Cap Growth
Type of Investment Portfolio: Primarily, common
stocks of small- to medium-sized U.S. and non-U.S.
growth companies that offer the opportunities for
higher capital appreciarion
Historical Volatility: Significant
INTERNATIONAL STOCK FUNDS
OVERSEAS EQUITY INDEX FUND
Momingstar Category: Foreign Large-Blend
Type of Investment Portfolio: Stocks are chosen to
replicare the characteristics of rhe Morgan Sranley
Capiral International EAFE Free Index
Historical Volatility: Significant
INTERNATIONAL FUND
Morning3tar Category: Foreign Large-Blend
Type of Investment Portfolio: Common stocks of
companies headquartered outside the United Srates
Historical Volatility: Significant
Data providrd by Morningstar.
Inc. @ All rights mavd. The
information contained herein;
(1) is proprinary to Morningstar
and/or its affiliaus; (2) may not
be copied or distribuud; (3) is not
warranted to be accurate, complnr or
timely. ICMA-RC does not
revirw the Morningstar Mta.
." leMA RETIREMENT
.- btViFT-
VANTAGECARE
RETIREMENT HEALTH SAVINGS PLAN
Return Booklet
This booklet contains the following documents:
. Suggested Resolution for Adoption of the VantageCare
Retirement Health Savings Plan
. Employer VantageCare Retirement Health Savings Plan
Adoption Agreement
. VantageCare Retirement Health Savings Plan
Implementation Data Form
. Administrative Services Agreement Addendum for the
VantageCare Retirement Health Savings Plan
leMA RETIREMENT CORPORATION
T t',I) P'JbhC SCGtOI [r.po: (
USING THE VANTAGECARE RETIREMENT HEALTH SAVINGS PLAN RETURN BOOKLET
This is one of two booklets containing information needed to establish your VantageCare Retirement Health
Savings (RHS) Plan with the ICMA Retirement Corporation (ICMA-RC).
This booklet includes:
"/0)( Suggested Resolution and Suggested Affirmative Statement for Adoption of the VantageCare Retirement
. Health Savings Plan
9a? Employer VantageCare Retirement Health Savings Plan Adoption Agreement
. VantageCare Retirement Health Savings Plan Implementation Data Form
. Administrative Services Agreement Addendum for the RHS Plan prepared for employers expecting to
adopt the Plan
Please return the following to ICMA-RC using the envelope provided:
1. A copy of the approved and executed Resolution or Affirmative Statement for adoption.
Your governing body may require the execution of a formal Resolution to adopt the RHS Plan. If so, you may
use this model Resolution. Other jurisdictions may simply require an Affirmative Statement for adoption of the
RHS plan. A model Affirmative Statement is also included. You may wish to speak with counsel to determine
which action is required in your jurisdiction. ICMA-RC cannot make this determination for you. Please return a
copy of the appropriate document to ICMA-RC along with the other forms in this Return Booklet.
2. The original completed RHS Adoption Agreement,
Detailed instructions for completion of the Adoption Agreement follow. You may wish to consult with your
ICMA-RC Retirement Plans Specialist and your benefits counsel on the various choices in the Adoption
Agreement.
If your governing body requires the execution of this Adoption Agreement at the same time as the Resolution,
or Affirmative Statement. please execute it prior to returning it to ICMA-RC along with the other forms in this
Return Booklet.
3. The original completed RHS Implementation Data Form.
This form provides ICMA-RC with the necessary contact information in order to set up your new VantageCare
Retirement Health Savings Plan.
4. Two executed originals of the Administrative Services Agreement Addendum.
Please execute both copies of the Administrative Services Agreement Addendum. Retain one original for your
records and return one original to ICMA-RC along with the other forms in this Return Booklet.
Please note
Upon receipt and processing of your Return Booklet, ICMA-RC will send you a written Notice of Plan Acceptance,
employee enrollment kits including an employee RHS announcement letter, employee election forms (if applica-
ble) and complete instructions for submitting contributions that may also be found in Chapter Three of the
VantageCare Retirement Health Savings Plan Employer Manual.
For assistance
Please contact the VantageCare Retirement Health Savings Plan New Business Analyst at 1-800-326-7272.
Please note that the information in this booklet and the documents herein take into account only the federal
tax rules related to ICMA-RC's VantageCare Retirement Health Savings Plan. Prior to implementing an RHS
plan, the employer is responsible for determining that there are no state or local laws that would prohibit it
from offering the plan to its employees. The employer must also determine that the options it selects in the
VantageCare Retirement Health Savings Plan Adoption Agreement fall within state/local requirements.
1
'~-Net- ,.J 02JL,~
SUGGESTED RESOLUTION FOR ADOPTION OF THE
VANTAGECARE RETIREMENT HEALTH SAVINGS (RHS) PROGRAM
plan Number: 8
Name of Employer:
State:
Resolution of the above-named Employer (the "Employer"):
WHEREAS, the Employer has employees rendering valuable services; and
WHEREAS, the establishment of a retiree health savings plan for such employees serves the interests of the
Employer by enabling it to provide reasonable security regarding such employees' health needs during retire-
ment. by providing increased flexibility in its personnel management system, and by assisting in the attraction
and retention of competent personnel; and
WHEREAS, the Employer has determined that the establishment of the retiree health savings plan (the "Plan")
serves the above objectives;
NOW, THEREFORE BE IT RESOLVED, that the Employer hereby adopts the Plan in the form of the leMA
Retirement Corporation's VantageCare Retirement Health Savings program.
BE IT FURTHER RESOLVED that the assets of the Plan shall be held in trust, with the Employer serving as
trustee, for the exclusive benefit of Plan participants and their beneficiaries, and the assets of the Plan shall not
be diverted to any other purpose prior to the satisfaction of all liabilities of the Plan. The Employer has executed
the Declaration of Trust of the (name of Employer) Integral Part Trust in the form
of: (Select one)
o The model trust made available by the ICMA Retirement Corporation
o The trust provided by the Employer (executed copy attached hereto).
BE IT FURTHER RESOLVED, that the (use title of Employer's official, not
name) shall be the coordinator and contact for the Plan and shall receive necessary reports, notices, etc.
\, ' Clerk of the (City, County, etc.) of
hereby certify that the foregoing resolution, proposed by (Council Member, Trustee, etc.)
, was duly passed and adopted in the (Council, Board, etc,)
at a regular meeting thereof assembled this
, do
of the (City, County, etc.) of
_ day of , 20_, by the following vote:
AYES:
NAYS:
ABSENT:
(Seal)
Clerk of the (City, County, etc.)
2
Instructions For Completing The Employer VantageCare Retirement Health
Savings Plan Adoption Agreement
The Employer VantageCare Retirement Health Savings (RHS) Plan Adoption Agreement specifies the details of
how your RHS Plan will operate. For example. the adoption agreement details employee eligibility requirements.
sources of contributions. the level of contributions. vesting provisions (if any). the types of benefits that will be
funded by the RHS Trust. and procedures to be followed in case of the death of the employee. The following
instructions outline how the adoption agreement should be completed. Any questions regarding the adoption
agreement can be directed to your ICMA-RC Retirement Plans Specialist. You may also wish to consult with
your benefits counsel.
I. Employer Name - Enter the official name of the employer sponsoring the RHS Plan (e.g. City of Any town,
State).
III. Effective Date of the Plan - Enter the date your RHS Plan will become effective.
IV. Welfare Plan - Enter the name(s) of the employee welfare benefit plan(s) that will be funded through the RHS
Plan. If you do not already have a retiree welfare plan in place, a sample plan is provided in the VantageCare
Retirement Health Savings Plan Retain Booklet.
Your welfare plan document(s) identifies the underlying benefits available to the retiree such as medical, dental
and long-term care coverage. It can be a simple document, but it must be in writing in order for your employees
to enjoy tax-free treatment of the benefits they receive.
V. Eligible Groups and Participant Eligibility Requirements
A. Eligible Groups: This section is used to designate the employee group(s) that are covered under your RHS
Plan. If you intend to provide different benefits or program features (e.g. vesting. benefits eligibility criteria) to
different groups of employees. you should establish distinct RHS Plans and complete a separate adoption agree-
ment for each group.
Please note that if your RHS Plan covers non-collectively bargained employees. AND if it provides for reimburse-
ment of any medical expenses other than insurance premiums. the welfare plan nondiscrimination rules will
apply. More information regarding these rules is available in the VantageCare Retirement Health Savings Plan
Questions And Answers For Employers and the VantageCare Retirement Health Savings Plan Employer Manual.
The coverage group specified in your adoption agreement must correspond to a group of the same designation
that is defined in the statutes, ordinances, rules, regulations, personnel manuals or other material in effect in
your state or locality.
Irrevocable Election to Participate: Unless you check this box, all employees in the eligibility group(s) you desig-
nate must participate in the RHS program.
If you desire, you may allow your employees to make a one-time irrevocable election to participate in the RHS
program by checking the Irrevocable Election box, Employees in the designated eligibility group(s) will be
allowed to elect to participate in the program on an irrevocable basis.
For newly eligible employees. you may allow an election window of no more than 60 calendar days from the
date of initial eligibility during which they may make the election to participate. Participation may begin no earli-
er than the calendar month following the end of the election window. If the employee does not make the election
in the year of initial eligibility, the election to participate may be made in a later year. You may provide an annual
election window of no more than 60 calendar days (e.g. November 1 to December 30) during which these
employees may make their elections. Participation may not begin until the following calendar year for employ-
ees that wait until a later year to make their participation election. In either case. the election may not be
revoked.
Employees that do not elect to participate in RHS will not be eligible to receive direct employer contributions or
to make employee contributions (mandatory or elective).
4
If you do not check this box, all employees in the covered group (current employees and future hires) will be
required to participate in the RHS program.
Note that the RHS plan upon which the VantageCare RHS IRS private letter ruling was based did not include
elective employee participation (see shaded portion of the Adoption Agreement). However, ICMA-RC has
obtained the opinion of counsel that this feature should be allowed as long as the requirements outlined in the
RHS Declaration of Trust and this Adoption Agreement are met. You may wish to discuss this feature with your
own benefits counsel. Any questions regarding this feature of the RHS program can be directed to your ICMA-
RC Retirement Plans Specialist.
B. Participant Eligibility: If desired, you may specify a minimum period of service (e.g. 6 months) and/or mini-
mum age (e.g. age 21) requirement.
VI. Contribution Sources and Amounts - This section defines the amount and types of contributions to your
RHS Plan.
A. Direct Employer Contributions and Mandatory Employee Contributions
You, as the employer, may choose to make
"f{) -'" direct employer contributions of a specific amount or percentage of earnings (as defined by you in
this section), .
. / I mandatory contributions of accumulated unused leave,
v
/ I mandatory contributions of employee compensation, or
I a combination of the above.
Your selection is made in Section VI.A. of the Adoption Agreement. Use Section VI.A.1. to define your direct
employer contribution formula. Use Sections VI.A.2. and 3. to define your mandatory accrued leave or compen-
sation contribution requirements.
Direct employer contributions
Direct employer contributions can be made as either a specific dollar amount or a percentage of earnings.
Please note that this definition of earnings is referred to in other sections of the Adoption Agreement.
You may need to complete the definition of earnings even if you do not choose to make direct employer
contributions.
Mandatory contributions of employee compensation and accumulated leave
Mandatory contributions can be used as a way to share responsibility for funding your retirement health plan
with your employees. Mandatory compensation contributions may take the form of either a reduction in salary
(e.g., 1 % of compensation is contributed to the Trust) or a decrease in the annual pay plan or merit increase
(e.g., 1 % of a 3% pay plan adjustment is contributed to the Trust). Earnings must be defined in Section VI.A.1.
The employer can establish an unused leave or compensation contribution formula that best fits the needs of its
covered employees. For example, the employer might require all accumulated leave in excess of a certain num-
ber of hours to be contributed to the RHS Plan on an annual basis. For mandatory contributions of both compen-
sation and leave, no FICA or income tax are payable at the time of contribution, and, if used for medical expens-
es of the participant. spouse or dependent. no FICA or income tax are payable at distribution.
Mandatory contributions of employee compensation or accrued leave are established by the employer - employ-
ees may not choose whether or not to make these contributions and they may not revise the contribution
amount.
5
Note that direct employer contributions made as a percentage of earnings, mandatory contributions of employee
compensation that are made as a percentage of earnings, as well as mandatory contributions of accumulated
leave, may be subject to nondiscrimination testing. See the discussion in the VantageCare Retirement Health
Savings Plan Questions And Answers For Employers and the VantageCare Retirement Health Savings Plan
Employer Manual, or contact your benefits counsel.
B. Employee Elective Contributions
In addition, you may also choose to allow your employees
I to make a one-time irrevocable election of the amount of their compensation that will be contributed on
an ongoing basis to your RHS Plan as an employer contribution,
I to make a one-time irrevocable election of the amount of their accrued leave that will be contributed
(generally at retirement) to your RHS Plan as an employer contribution,
I to make an annual, irrevocable election to have all or a portion of their leave accruing in the next calen-
dar year contributed to your RHS Plan as an employer contribution,
I to elect to make voluntary after-tax contributions, or
I a combination of the above.
If you desire to allow irrevocable employee elections or after-tax contributions, complete Section VI.B. See
immediately below for additional information regarding each of these contribution types.
Note that the RHS plan upon which the VantageCare RHS IRS private letter ruling was based did not include
elective employee contributions (see shaded portion of the Adoption Agreement). However, ICMA-RC has
obtained the opinion of counsel that these features should be allowed as long as the requirements outlined in
the RHS Declaration of Trust and this Adoption Agreement are met. You may wish to discuss these features with
your own benefits counsel. Any questions regarding these features of the RHS program can be directed to your
ICMA-RC Retirement Plans Specialist.
Note that elective employee contributions (with the exception of voluntary after-tax contributions and contribu-
tions of a fixed dollar amount of compensation made pursuant to an irrevocable election) may be subject to
nondiscrimination testing. See the discussion in the VantageCare Retirement Health Savings Plan Questions
And Answers For Employers and the VantageCare Retirement Health Savings Plan Employer Manual, or contact
your benefits counsel.
Irrevocable Election to Contribute Compensation or Accrued Leave
Your RHS Plan can provide a way for employees to choose the amount of their compensation or previously
accrued sick, vacation, and other types of leave they wish to contribute to the Plan on a tax-deferred basis. The
employer and employee will pay no FICA or income tax on the contributed funds, and, if used for medical
expenses for the participant, spouse or depenents, no FICA or income tax will be due at distribution. Please
note that employees may not choose whether or not to receive their leave or compensation in cash once they
elect to contribute it to the RHS plan, Once your employees make an irrevocable election to contribute compen-
sation or accrued leave, the election will apply to all succeeding years in which they participate in the RHS pro-
gram. The election cannot be revised or revoked.
You may allow employees to make an irrevocable election with respect to compensation or accrued leave, or
both. In addition, you may specify the type(s) of leave that may be contributed. To allow your employees to
make irrevocable elections to contribute compensation or accrued leave, complete Section VI.B.1.a. or b, The
employee's election is made on the VantageCare RHS Plan Irrevocable Employee Pre- Tax Contribution Election
Form.
Employers should discuss with counsel the number or range of choices provided to participants. The IRS guid-
ance upon which this election is based consisted of three specific percentages of compensation.
6
There is no fixed maximum or minimum contribution amount or percentage for irrevocable election contribu-
tions of compensation or leave. If you desire to provide for such limits, however, you may do so.
you must define earnings in Section VI.A.I if you allow an election with respect to compensation.
For newly eligible employees, you may allow an election window of no more than 60 calendar days from the
date of initial eligibility during which they may make the election to contribute. Contributions may begin no earli-
er than the calendar month fOllowing the end of the election window. If the employee does not make the election
in the year of initial eligibility, the election to contribute may be made in a later year. You may provide an annual
election window of no more than 60 calendar days during which these employees may make their elections.
Contributions may not begin until the following calendar year for employees that wait until a later year to make
their election. In either case, the election may not be revoked.
Annual Irrevocable Election to Contribute Leave Accruing in the Next Calendar Year
Your RHS Plan can also allow participants to contribute sick, vacation and other types of leave that are scheduled
to be accrued in the next calendar year on a tax-deferred basis. As with irrevocable election contributions of
compensation and accrued leave, no FICA or income tax is payable on these future accrual contributions and, if
used for medical expenses for the participant, spouse and dependents, no FICA or income tax will be due at dis-
tribution.
To allow your employees to make annual elections to contribute leave accruing in the next calendar year, com-
plete Section VI.B.l.c.
Future leave accrual contributions must be elected prior to the start of the next calendar year - employees may
not elect to contribute the value of their sick and vacation leave for the calendar year during which the election is
made. There is no exception for newly eligible employees - all elections must be made in the prior calendar
year.
You may specify the type(s) of leave that may be contributed pursuant to the annual irrevocable election to con-
tribute future accruals. In addition, you may specify whether you wish contributions of future leave accruals to
be made as the leave is earned or at the end of the year. In either case, the leave must be retained for contribu-
tion to the RHS plan. In the case where you specify contributions to be made at the end of the year, the leave
must be placed in "reserve" as it accrues such that the employee cannot access it. The leave must be con-
tributed to the RHS Plan.
There is no fixed maximum or minimum contribution amount or percentage for annual irrevocable election con-
tributions of future leave accruals. If you desire to provide for such limits, however, you may do so.
Your employees' election to contribute future leave accruals will apply to all succeeding years until revised by
the employee on the VantageCare RHS Plan Annual Prospective Leave Election Form.
Voluntary After- Tax Contributions
If you choose, your employees may elect to make voluntary after-tax contributions to their RHS accounts. In
order to protect the tax-exempt status of your RHS Trust, aggregate employee after-tax contributions are limited
to no more than 25% of total contributions to your RHS plan. You may specify a lower limit. andlor enforce the
limit at the employee level if you wish.
After-tax contributions are subject to FICA (if applicable) and income tax.
To allow your employees to make voluntary after-tax contributions, complete Section VI.B.2.
Your employees may modify their after-tax contribution election at any time by completing the VantageCare RHS
Plan Employee After- Tax Contribution Election Form.
C. Limits on Contributions
You may establish limits on each type of RHS Plan contribution by completing the pertinent sections referenced
above. In addition, you may establish an overall limitation on RHS plan contributions by completing Section
7
VI.C. While this is not a requirement of the program, you may do so to ensure that the RHS program does not
provide benefits in excess of reasonable benefits normally provided by such a welfare plan. You may wish to
speak with your benefits counsel.
Recordkeeping of Contribution Types
Note that the IRS considers direct employer contributions, mandatory accrued leave and mandatory compensa-
tion contributions, irrevocably elected employee compensation and accrued leave contributions, and future leave
accrual contributions, to be employer contributions. In other words, all contributions other than voluntary after-
tax contributions are considered to be employer contributions. However, ICMA-RC will record keep the direct
employer contributions as a distinct source for participant reporting purposes. Voluntary after-tax contributions
will also be sourced to a distinct employee after-tax source. All other types of employee contributions -- manda-
tory accrued leave, mandatory employee compensation, irrevocably elected employee compensation and
accrued leave contributions, and future leave accrual contributions -- will be combined and shown as employee
pre-tax contributions on participant statements.
See the VantageCare RHS Employer Manual for directions on how to report your contribution detail properly via
EZ Link.
VII. Vesting - Mandatory unused leave, mandatory employee compensation, irrevocably elected employee com-
pensation and accrued leave, future leave accrual and employee voluntary after-tax contributions are always
100% vested. In addition, the RHS Plan default is 100% vesting for direct employer contributions.
However, if you desire, you may specify a vesting schedule for your direct employer contributions in this section.
Note that a participant's RHS account will automatically become 100% vested upon the death, disability, retire-
ment (as you define it in Section VII.C.) and attainment of benefit eligibility by the participant.
Note also that the "years of service completed" for a participant that separates from service and is then rehired
will start over for vesting purposes upon rehire.
VIII. Forfeiture Provisions
All RHS plans must contain a forfeiture provision. These instructions will be used in two situations:
. Your RHS plan includes direct employer contributions subject to vesting: when a participant separates
from service prior to attaining full vesting, the nonvested assets will be forfeited and used as you direct
in Section VIII.
. Upon the death of a participant: If there are no surviving spouse, dependents, or designated beneficiar-
ies, remaining assets will revert to your RHS Trust to be utilized as you direct in Section VIII. Note that
as long as there are designated survivors (including a beneficiary of a former beneficiary), no forfeiture
will occur. See also Section XI. below.
There are four choices:
n Forfeited account balances will be used to offset your direct employer contributions for the next and suc-
ceeding contribution cycles.
o Forfeited account balances will be reallocated on an equal dollar basis among remaining plan partici-
pants.
o Forfeited account balances will be reallocated among remaining plan participants based on account bal-
ances.
o Forfei.ted account balances will revert to the employer. (It is anticipated that few employers will choose
this option, in order for RHS funds to continue to be used for medical benefits for remaining partici-
pants.)
Regardless of which option you choose. you must inform ICMA-RC at the time you wish to use the forfeited
funds.
8
IX. Eligibility Requirements to Receive Medical Benefit Payments from the VantageCare Retirement Health
Savings Plan
A. This section defines your benefit eligibility provisions. You may select:
o Retirement, as defined in Section VILC.
o Separation from service, with criteria defined by the employer, if desired
o Attainment of a certain age
o A combination of retirement and a certain age.
If you designate retirement as a portion of your eligibility criteria, you must define "retirement" in Section VILC.
even if you did not specify a vesting schedule in Section VII.B.
B. Use this section to specify benefit eligibility criteria for employees that separate from service prior to attain-
ing the general benefit eligibility you have selected in Section A. For example, if your general benefit eligibility
criteria requires employees to "retire" before they become eligible for benefits, you may have some employees
that separate from service prior to retirement; in this situation, you need to designate a specific time for those
early-separating employees to become eligible for benefits. You might specify immediate eligibility or a certain
age (e.g. retirement age under your general pension program). If you do not specify benefit eligibility criteria in
Section B., employees that leave employment prior to attainment of your general benefit eligibility may never
attain benefit eligibility, and their account will not be available for use until the employee's death.
c. Note that employees will automatically become eligible for medical benefits if they are disabled. In addition,
upon the death of the employee, the surviving spouse and dependents will automatically become eligible for
benefits. See Section XI.
X. Permissible Medical Benefit Payments - This section is used to designate the medical expenses that will qual-
ify for reimbursement under your RHS Plan. You may offer reimbursement for all qualifying medical expenses as
defined in Internal Revenue Code Section 213 (Le. medical costs that would otherwise be deductible to the
employee on his or her individual income tax return) other than direct long-term care expenses. Alternatively,
you may pick and choose the benefits that will be provided. For example, reimbursements may be made avail-
able only for health insurance premiums, COBRA premiums, Medicare supplemental insurance premiums, den-
tal insurance premiums, out-of-pocket medical costs, qualified long-term care insurance, etc. The employer may
allow reimbursement for only one benefit, or for any combination of qualifying medical costs. Information
about what constitutes a qualifying medical expense can be found in IRS Publication 502, Medical and Dental
Expenses (available on the IRS Web site at http://www.irs.govl).
XI. Death Benefit - This section is used to define the treatment of the participant's account balance at death.
Upon the death of the parti6pant, the surviving spouse andlor surviving eligible dependents are immediately eli-
gible to maintain the account and utilize it to fund eligible medical benefits. If there are no surviving spouse or
dependents, a designated beneficiary will be allowed to use the account assets for medical expense reimburse-
ments. (For example, the participant might name his or her adult children or a parent as beneficiary.)
Upon notification of the death of the participant. ICMA-RC will create a new account in the transferee's name and
move all funds into the Vantagepoint Money Market Fund.. The transferee may move the money into other
investments once the new account has been established.
· Please read the current prospectus carefully prior to investing. An investment in this fund is neither insured
nor guaranteed and there can be no assurance that the Fund will be able to maintain a stable net asset value of
$7.00 per share. Vantagepoint Mutual Funds are distributed by ICMA-RC Services, LLC, a controlled affiliate of
ICMA Retirement Corporation. Member NASD/SIPC.
XII. De Minimis Accounts
Upon separation of service from the Employer prior to a Participant becoming eligible for medical benefits from
a VantageCare Retirement Health Savings Plan account, Participant accounts that are considered de minimis as
specified in Section XII will be paid to the Participant.
9
If the empployee is already eligible for health benefits through the RHS plan, his/her account will not be consid-
ered de minimis regardless of the balance. Likewise, if the employee dies or is disabled, no de minimis payment
will be made.
If you wish to name a lower de minimis account value, or if you do not wish to include a de minimis feature
from our RHS program, check the appropriate box in Section XII.
o The de minimis account value shall be $5,000 or less.
o The de minimis account value shall be $
less.
(insert dollar amount between $0 and $5,000) or
o The Plan shall not allow de minimis account distributions.
XIII. Other Provisions - This section defines other provisions of the RHS Plan, including:
o RHS Plan administration must be accomplished via ICMA-RC's EZ Link System.
o RHS Plan fee payment.
o Employer responsibilities for tax reporting and remitting.
After you have completed the Adoption Agreement, it should be signed (and executed, if required by your state
or local law), and returned to ICMA-RC with the other documents in this booklet.
Questions regarding completion of the Adoption Agreement can be directed to your ICMA-RC Retirement Plans
Special ist.
10
live Pre. Tax Contributions
8. Irrevocable Election for Pre-Tax Contributions from Compensation: A one-time, irrevocable election of
th;e amount of Employer contributions of compensation made on his or her behalf.
The Employer limits the amount elected to either a fixed percentage or a range of percentages of an
Employee's earnings
<J % of ~arnings (as defined in VI.A.1.) or up to 100
VIA1) for the Plan Year.
% of earnings (as defined in
~~wly eligible Employees shall be providedan elect/C)" window of ~b days (no more than 60)
from the,date of initial eligibility during which they may make the election to contribute. Contributions
may begin no earlier than the calendar month following the end of the election window.
If the Employee does not make the election in the year of initial eligibility, the election to contribute may
.' be made in a later year. An annual election window of (,,0 days (no more than 60) shall be
provided during which the election may be made. The election window shall run from JOc..t ,_ to
~O\l. '2-.i-- (insert your annual time frame for the election window). Contributions may oegin no ear-
lier than the calendar year following the year of the election.
Once made, the election is irrevocable and may not be revoked.
~. Irrevocable Election for Pre-Tax Contributions of Accrued Leave: A one-time, irrevocable election of
'the amount of employer contributions of Employee accrued
~iCk rn<acation ~her Co~ ~~ (describe) leave made on his or her behalf.
llYYes 0 No
The Employer limits the ?mou~telec!ed a? sh.owp below: _ .
. S\e...k \.Q.o..ve Cm\...1;nI..u...\'\',hf\ ~s. (\Wlt+eJi to Qo.CG."\Jd ~ o.wi. ~5e-rv,c..e.
~~r'tL'bMC; ^l~l.n~d l~ ~ ~)\(, ~lC'iL~~bV~ ~l':lU+ ,?C\\c't,
Newly eligible Employees shall be provided an election window of <00 days (no more than 60
calendar days) from the date of initial eligibility during which they may make the election to contribute.
Contributions may begin no earlier than the calendar month following the end of the election window.
If the Employee does not make the election in the year of initial eligibility, the election to contribute may
be made in a later year. An annual election window of bO days (no more than 60 calendar
days) shall b~ orovider1 during which the election may be made. The election window shall run from
''DC..tL to _Ned ~ "l::!l. (insert your annual time frame for the election window). Contributions may
begin no earlier than the calendar year following the year of the election.
Once made, the election is irrevocable and may not be revoked.
'~. Annual Prospective Election for Pre-Tax Contributions of Leave: An annual, irrevocable election to
have his or her 0 sick lY"Vacation 0 other (describe) leave to be accrued in the next
calendar year contributed to the Plan on his or her behalf.
13
':';m~E~ployer limits the amaunt elected as shawn belaw:
"' 'iP,LJti9ns .of future lea,!~ ~c,cfU~ls"V~I(b~ r~mJt,t~:,~9.t~E!"m.~~:
~:t:';~:;6;;~:. ""~" :~',:::~'<:'_::' .. :_', ~,.~-"'~ ~.. ~(:"<~~\:,~~-:"~(-r'xfi:::~,:~},~~;'L/,':yt\'j> :~"...;-.. "- ""-.'
ea'rrled 0 at the end.af the calendar year.' ',>
-, ,".. :'. ; >,L,~'-:'.; ,;. ,,~',' -,' A .'
"'):, : ,-: -'. ',_ :_ .. ';'<:-':_,:i'> ~ ,~' O':/<':':}}:~>-;"\'i'i~'.;-'~,":",>_:,--,' ---":h~"':'.~? , ",.,' ' .
,.,tonta c::antribute mU5t,be ma.~eJnth~,d~.Ie,'n~arfyea.rb~f()re the' year, In \/IIhich cantributians are to
,; ncemade.the electian shaH apply'ta'succeediri~(ciilendat yea.rs unles's .otherwise revised .or
~. <, . . -"
~".,,::.. ,,'\,' '," ,\':'",
r[evacable,E!.I(!cti()O'cantriblJtiqps; i.l1;an;lntegr~JPl!. . ." ..,st,;'SM!\-RC has .obtal,ned the advice .of
'~t ~UCh 'ca~trlbutjorts'~r~ ailo\Vai)fe'ljnder:~~e:~~ni~fa:i1s~~tljne~int~!S ~cjoption' Agreement. The
'S..h.~Uld di~Gg~sitJI~i'1jisi[~i.~it~0~~;~;~G~,~i:;co~n~~tM/';;" '> .....,.. .:~ .:' ".: . "', .
fte~~ Tax Contributions':;/.:: ,<> . "" ~<
, ,.., I "' ',"'d. , %'~~~'9fi~'~f~~il~~,;;\~l{if~r~~~~v~l~h ?~;r an
*~~jtfJf,lllilr:",}. .. . . ,,)i~~~~i~~~~?J~,u:n~ ~~ 25%
. shall havetl1.a right to discontinue or,varythe,rate.af elecii~ifatter~ta~ contributiarisof Emplayee
ti~"- .. ":.- -,- ::::.':.Y\' '. ." ,.<\,.: -', .~. ::;:::,:;"";,, --';;~/'~.': ;-t;;;,:'"j;:2~':';,;t:~;:,:,~(.~:'::~:~{:':~}y'~^:",/,::~::-;:r-'?::{..~~E-}:'~ ..)f:'J~:. :;y~'~:j.~,\\<'.:- ,"~~- ;.:.;..,,::-- -'"-',,' ::".:.:., -'~ " .
; .>':;:. ' ," ."'-"'y':;,: . '. .:~;:.
.Jjithis secti()n. the Emplayer aC:~r10,^,ledge$:tl1~i{hi~i~ternaiRev~nu~se,yice has declined ta rule an
4@ftertax c0!1tributiansil1anjniegr.a\:parttfUst;~'lCM:~~~C.-t!8S~9~tain~cIthead"lceof caunsel that such
,ns' Clr~ aUawa.blein a nln5U~StaO!I.aj_a.rr..qlJn.((Iiii{tio:'wo~~'tha.~:~~~~ oHotaJ.cantri,putians'in any Pia n
,e Employer shauld disct..issl:tiisissue~lfh ~pprdpriate:counsei.>';,'<r/;.',:;:<:' ",,;, ". "
-'1:;'Yi'/.:": ".' . ""', ,,;':,',t,',," .. ;,.,; " ','-',<
C. Limits on Total Contributions
The tatal cantribution on behalf each Participant (including both Mandatory and Elective
Cantributians) for each Plan Year shall nat exceed the foll.owing limit(s):
o % of earnings (as defined in VI.A.1.).
o $
~here is no Plan-defined limit on the percentage or dollar amount of earnings that may
be contributed.
Limits an individual contributian types are defined within the appropriate section above,
See Section V.A. for a discussi.on .of n.ondiscrimination rules that may apply to non-collectively bargained self-
insured Plans.
14
VII. Vesting Schedule
A. The account is 100% vested at all times, unless specified otherwise in B. below.
B. The following vesting schedule applies to Direct Employer Contributions outlined in VI.A.1:
Years of
Service
Completed
Specified
Percent
Vesting
%
%
%
%
%
%
%
%
%
C. The account will become 100% vested upon the death, disability, retirement, or attainment of
benefit eligibility by a Participant.
.
Definition of retireme~t: A<;. ck.. ~ ~ ~ ~~ \ < F ~ 5 ~h(,"<.w1<..v\.t-p {~
~~L'~ . 0: +hP C.l'"'f <. .r~ 'lYl~.-~ c_ ~DII\ r-e:tll('tmJ(~+ ?l6-V\
c."... '-l\-=>r." .;S'~~-c.-~~ ~~ (Ul-~(~M-e 1- If' t7ct Vq,s~ 11\ ~l~U-~~ ~re.~ ~b....\ .
D. Any period of service by a Participant prior to II retfire o? the Participant by the Employer st-mll not
count toward the vesting schedule outlined in B. above.
VIII. Forfeiture Provisions
Upon separation from the service of the Employer or upon reversion to the Trust of a Participant's account
assets remaining upon the participant's death (as outlined in Section XI), a Participant's non-vested funds shall:
o Remain in the Trust to be reallocated among all Plan Participant's as Direct Employer Contributions for
the next and succeeding contribution cycle(s),
o Remain in the Trust to be reallocated on an equal dollar basis among all Plan Participants.
o Remain in the Trust to be reallocated among all Plan Participants based upon Participant account bal-
ances.
o Revert to the Employer.
In the case of separation from service, the Participant's non-vested funds shall be applied as shown above. In the
case of reversion due to the Participant's death under Section XI. the remaining account assets shall be applied
as shown above.
IX. Eligibility Requirements to Receive Medical Benefit Payments from the VantageCare Retirement Health
Savings Plan
A. A Participant is eligible to receive benefits:
/
V
At retirement only (as defined in Section VII.C.)
At seoaration from service with the following restrictions
. :IS l\~+ e..'~~ lbl-i. 'h,r;- "~.:h('6~."Lt;'\t f'1'~WI. ~ C~ 1)
At age u. ":! ·
At retirement and age
At retirement or age
15
B. Termination prior to general benefit eligibility: A Participant who separates from the service of the Employer
prior to attaining benefit eligibility as outlined in Section IX.A. or C. will be eligible to receive benefits:
~mmediatelY upon separation from service.
D At age
C. A Participant who dies or becomes totally and permanently disabled (as defined by the Social Security
Administration) will become immediately eligible to receive medical benefit payments from his/her VantageCare
Retirement Health Savings Plan account.
X. Permissible Medical Benefit Payments
Benefits eligible for payment consist of:
A. / All Medical Expenses eligible under IRC Section 213. other than direct long-term care
expenses, OR
B. The following Medical Expenses (select only the expenses you wish to cover under the
VantageCare Retirement Health Savings Plan):
Medical Insurance Premiums
Medical Out-of-Pocket Expenses.
Medicare Part B Insurance Premiums
Medicare Supplement Insurance Premiums
COBRA Premiums
Dental Insurance Premiums
Dental Out-of-Pocket Expenses.
Long Term Care Insurance Premiums
Other (Must be eligible under IRC Section 213).
· See Section V.A. for a discussion of nondiscrimination rules which may apply to non-collectively bargained,
self-insured Plans.
XI. Death Benefit
In the event of a Participant's death. the following shall apply:
Account Transfer: The surviving spouse and/or surviving eligible dependents (as defined in Section XIII.F.) of the
deceased Participant are immediately eligible to maintain the account and utilize it to fund eligible medical bene-
fits specified in Section X above.
Upon notification of a Participant's death. the Participant's account balance will be transferred into the
Vantagepoint Money Market Fund.. The account balance may be reallocated by the surviving spouse or
dependents.
.. Please read the current prospectus carefully prior to investing. An investment in this fund is neither insured
nor guaranteed and there can be no assurance that the Fund will be able to maintain a stable net asset value of
$1.00 per share. Vantagepoint Mutua/ Funds are distributed by /CMA-RC Services, LLC, a controlled affiliate of
ICMA Retirement Corporation. Member NASD/S/PC,
If a Participant's account balance has not been fully utilized upon the death of the eligible spouse, the account
balance may continue to be utilized to pay benefits of eligible dependents. Upon the death of all eligible depend-
ents, the balance will be available for medical benefits for the designated beneficiary of the last dependent or
spouse to die. Assets remaining upon the death of a designated beneficiary shall be available for medical bene-
fits of the beneficiary's designated beneficiary. If there is no living beneficiary(ies). the account will revert to the
Plan to be applied as specified in Section VIII.
16
There will be no elective withholding of federal, state, or local taxes for medical benefit payments to the
Participant's spouse's or dependent's designated beneficiary(ies).
If there are no living spouse or dependents at the time of death of the Participant. the account will be available
for medical benefits for the designated beneficiary(ies) of the Participant. Assets remaining upon the death of all
designated beneficiaries shall be available for medical benefits of the beneficiary's beneficiary. If there is no liv-
ing beneficiary(ies), the account will revert to the Plan to be applied as specified in Section VIII.
There will be no elective withholding of federal, state, or local taxes for medical benefit payments to the
Participant's beneficiary(ies) or any beneficiary's beneficiary.
XII. De Minimis Accounts
Upon separation from the service of the Employer prior to a Participant becoming eligible for medical benefits
from a VantageCare Retirement Health Savings Plan account, Participant accounts that are considered de min-
imis as specified below will be paid to the Participant.
o The de minimis account value shall be $5,000 or less.
o The de minimis account value shall be $
$5,000) or less.
{insert dollar amount between $0 and
C9"'The Plan shall not allow de minimis account distributions,
XIII. The Plan will operate according to the following provisions:
A. Employer Responsibilities
1, The Employer will submit all VantageCare Retirement Health Savings Plan contribution
data via electronic submission.
2. Participant status updates and/or changes or personal information updates and/or changes (Participants'
termination dates, Participants' benefit eligibility dates, etc.) will be provided via electronic submission.
B. Participant account administration fees will be paid through the redemption of Participant account shares,
unless agreed upon otherwise in the Administrative Services Agreement.
C. Employer plan fees will be paid by the Employer as outlined in the Administrative Services Agreement.
D. Assignment of benefits is not permitted.
E. Payments to an alternate payee (payee other than a Participant) are not permitted with the exception of reim-
bursement of health insurance premiums to the Employer.
F. An eligible dependent is the Participant's lawful spouse and any other individual who is a person described in
IRC Section 152(a).
G. The Employer will be responsible for withholding, reporting and remitting any applicable taxes, as outlined
in the VantageCare Retirement Health Savings Plan Employer Manual.
XIV. The Employer hereby acknowledges it understands that failure to properly fill out this Employer
VantageCare Retirement Health Savings Plan Adoption Agreement may result in the loss of tax exemption of the
Trust and/or loss of tax-deferred status for Employer contributions.
17
VantageCare Retirement Health Savings Plan
Implementation Data Form - Page 2
Plan Contacts
(If any item #16-21 is left blank, the Primary Contact in #5 will receive mailings
Payroll Contact Contact Signature:
Information 16. PT01
(200) Contact Name: L,,^-A 1,' ~ c. ~ t\. \
Please indicate (200) Contact Title: i\50~ . Fll.U."'~""'-'L b;~
alternate (420) Telephone: (1Q5J '1~ 2. - \ 510 S- Fax:
addresses in
Coments Section 17. PT08 Contact Signature:
(200) Contact Name:
(200) Contact Title:
(420) Telephone: (---.J Fax:
18. PT09 Contact Signature:
(200) Contact Name:
(200) Contact Title:
(420) Telephone: (---.J Fax:
Contribution 19. PT02 (200) Contact Name: ~,,-ck.. 1) ~ 5.c- \
Contact (200) Contact Title: Ac;~ -- 1)
t-~<..
Information (420) Telephone: ~ '792' l.ftD:;
Trustee Contact 20. PT10 (200) Trustee Name:
Information (200) Trustee Title:
(200) Trustee Address:
Street
City State
(420) Telephone: l-J
Billing (Fees) 21. PT06 (200) Contact Name: L\~ ....Jr. ~ll c..o.-\
Contact (200) Contact Title: M-.f'~(.~ "1;
Information (421) Telephone: (SbC;) ,qz. - tl?c>"",
Comments:
(Alternate
Addresses for
#16-21)
Internal Use
Only 641 912 608
- - -
- ...& .
-~.
r<;/WIJI /rt.TIAliMr.rn C;O"POR/.TION
:-Dr
~ 7~'2 - (S'''"S
L-)
(---.J
ti:e....:-k,r
Fax: ~ '7t(2.-{76~
Zip
Fax: L-l
~,
Fax: ~ iqL- \5lS
ICMA Retirement Corporation' Attn: Records Management Unit. P.O. Box 96220 . Washington, DC 20090-6220 . Toll Free '-800669.7400
21
This booklet should be accompanied by the following materials:
Sample Enrollment Kit
Pre-addressed, Postage-Paid Envelope
If you have not received all of these documents, please notify your New Business Analyst at
(800) 326-7272 immediately.
ICalJA. RETIREM~NT CORPORATION
777 North Capitol Street, NE
Washington, DC 20002
1-800-326-7272
www.icmarc.org
BKTOOO-007 -200212
VANTAGECARE
RETIREMENT HEALTH SAVINGS PLAN
Retain Booklet
This booklet contains the following documents:
. Model Integral Part Trust Document
. Private Letter Ruling
. Sample Welfare Benefit Plan
leMA RETIREMENT CORPORATION
ThO Public SOGtor [v,POIt
RETAIN BOOKLET
USING THE VANTAGECARE RETIREMENT HEALTH SAVINGS PLAN
RETAIN BOOKLET
This is one of two booklets containing information to establish your VantageCare Retirement Health
Savings (RHS) Plan with the ICMA Retirement Corporation.
This booklet includes:
~odel Integral Part Trust Document
./. Private Letter Ruling
;. SePflplc Welfare Benefit Plan
Please read the information and retain it for your files.
MODEL INTEGRAL PART TRUST DOCUMENT
You will need to execute a trust document; you may execute the model trust document in this retain
booklet by inserting your information on pages 3, 4, 6, and 12. If you do not use the ICMA-RC model trust
document, your individually designed document must be reviewed and approved by ICMA-RC prior to
your joining the RHS program. This will ensure that ICMA-RC can administer all provisions of your plan.
The ICMA-RC model trust document has been worded broadly to encompass any employer's RHS pro-
gram. In most situations, as with your 457 or 401 plans, the Employer will act as Trustee. In this case, the
terms Administrator and Trustee will refer to the Employer. Each reference to the Employer, Administra-
tor, or Trustee refers to the Employer acting in the appropriate capacity. The Trust agreement is J]Q1 an
agreement between you and ICMA-RC; it provides for the legal establishment of the RHS Trust and lays
out the duties of the Employer and Trustee with respect to the trust. The agreement gives the Employer
(acting as Administrator) the ability to designate another entity (Le. ICMA-RC) to perform administrative
services for the RHS plan. The Administrative Services Agreement contained in the return booklet consti-
tutes the contract between you and ICMA-RC for these services.
The ICMA-RC model trust document may also be used in the situation where the Employer retains the
services of an outside third-party trustee. In this case, the term Trustee refers to that third-party trustee.
In no case may ICMA-RC be named as trustee for your RHS plan.
PRIVATE LETTER RULING
ICMA-RC has obtained a private letter ruling from the IRS approving one employer's RHS Plan trust. Your
use of ICMA-RC's model trust document will provide you with comfort that the trust for your Plan is also
within the IRS' requirements. (This is similar to the comfort provided when you use ICMA-RC's model 457
plan document.) Of course, you may want to talk to your legal counsel about whether or not you should
obtain a private letter ruling on your own RHS trust document if you choose not to use the ICMA-RC
model document.
Note that the plan upon which the IRS private letter ruling was based did not include certain features that
have subsequently been added to the RHS program. These features include
. the irrevocable election to participate in the program,
. the irrevocable election to contribute compensation or accrued leave*,
. the irrevocable prospective election to contribute leave to be earned in the coming year*, and
. voluntary employee after-tax contributions (Article 7.2 of the Trust).
*These contribution types are treated as Employer contributions under Article 7.1 and 7.3 of the Trust.
VANTAGECARE RETIREMENT HEALTH SAVINGS PLAN
However, ICMA-RC has obtained the opinion of counsel that these features should be allowed as long as
the requirements outlined in the Trust and Adoption Agreement are met. Any questions regarding these
features of the RHS program can be directed to your ICMA-RC Retirement Plans Specialist.
SAMPLE WELFARE BENEFIT PLAN
You will need to execute a welfare benefit plan if you do not already have one in place. You may execute
the sample welfare benefit plan provided herein or you may execute your own welfare benefit plan. It can
be a simple document, but it must be in writing in order for your employees to enjoy tax-free treatment of
the benefits they receive from this plan or any other welfare benefit plan you provide.
FOR ASSISTANCE
Please contact your VantageCare Retirement Health Savings Plan New Business Analyst at 1-800-326-7272.
Please note that the information in this booklet and the documents herein take into account only the
federal tax rules related to ICMA-RC's VantageCare Retirement Health Savings Plan. Prior to implementing
an RHS plan. the employer is responsible for determining that there are no state or local laws that would
prohibit it from offering the plan to its employees. The employer must also determine that the options it
selects in the VantageCare Retirement Health Savings Plan Adoption Agreement fall within statellocal
requirements.
2
J<~iJAJ.~N-I1TjYTJ\.-rJ:.-l
DECLARATION OF TRUST OF THE
Crt" of' <<5'~~ L\es ~.~\./ 'FL INTEGRAL PART TRUST
J NAME OF EMPLOYER
3
VANTAGECARE RETIREMENT HEALTH SAVINGS PLAN
DECLARATION OF TRUST OF THE
e~~ 0(::::- S;~V\.~ 1:A.es."t~1 FL
NAME OF EMPLOYER
INTEGRAL PART TRUST
Declaration of Trust made as of the
day of
, 20 0 '"' ,
FL a fF21;\.'1;Glpd~
State Type of EntIty
or its designee (hereinafter
by and between the C.d-"j 0 F 5 '^-~ ""'J .:r:::s. ic- ~ -geLu:.~
Name 01 Employer
(hereinafter referred to as the "Employer") and
Name olTruslee
referred to as the "Trustee").
RECITALS
WHEREAS, the Employer is a political subdivision of the State of
exempt from federal income tax under the Internal Revenue Code of 1986; and
F \ 0 ,u:ic"--,,
State
WHEREAS, the Employer provides for the security and welfare of its eligible employees (here-
inafter referred to as "Participants"), their Spouses, Dependents and Beneficiaries by the maintenance of
one or more post-retirement welfare benefit plans, programs or arrangements which provide for life,
sickness, medical, disability, severance and other similar benefits through insurance and self-funded
reimbursement plans (collectively the "Plan"); and
WHEREAS, it is an essential function and integral part of the exempt activities of the Employer
to assist Participants, their Spouses, Dependents and Beneficiaries by making contributions to and accu-
mulating assets in the trust, a segregated fund, for post-retirement welfare benefits under the Plan; and
WHEREAS, the authority to conduct the general operation and administration of the Plan is
vested in the Employer or its designee, who has the authority and shall be subject to the duties with
respect to the trust specified in this Declaration of Trust; and
WHEREAS, the Employer wishes to establish this trust to hold assets and income of the Plan
for the exclusive benefit of Plan Participants, their Spouses, Dependents and Beneficiaries;
NOW, THEREFORE. the parties hereto do hereby establish this trust, by executing the Declara-
, \:- S' .... . ~ i
tion of Trust of the e. \~ LJ' ~""'''Lj ~(r.s [)eO.(~ Integral Part Trust (hereinafter referred to
Name 01 Employ r
as the "Trust"), and agree that the following constitute the Declaration of Trust (hereinafter referred to as
the "Declaration"):
4
RETAIN BOOKLET
ARTICLE I
Definitions
1.1 Definition~ For the purposes of this Declaration, the following terms shall have the respective
meanings set forth below unless otherwise expressly provided.
(a) "Account" means the individual record keeping account maintained under the Plan to record the
interest of a Participant in the Plan in accordance with Section 7.4.
(b) "Administrator" means the Employer or the entity designated by the Employer to carry out admin-
istrative services as are necessary to implement the Plan.
(c) "Beneficiary" means the Spouse and Dependents, or the person or persons designated by the
Participant pursuant to the terms of the Plan. who will receive any benefits payable hereunder in
the event of the Participant's death. A Beneficiary may also designate a beneficiary(ies) to receive
any benefits payable hereunder in the event of the preceding Beneficiary's death, until the satisfac-
tion of all liabilities under the Plan to provide benefits. In the case where there is no designated
Beneficiary, any amount of contributions, plus accrued earnings thereon, remaining in the Account
must. under the terms of the Plan, be returned to the Trust.
(d) "Code" means the Internal Revenue Code of 1986. as amended from time to time.
(e) "Dependent" means an individual who is a person described in Code Section 152(a).
(f) "Investment Fund" means any separate investment option or vehicle selected by the Employer in
which all or a portion of the Trust assets may be separately invested as herein provided. The
Trustee shall not be required to select any Investment Fund.
(g) "Nonforfeitable Interest" means the interest of the Participant or the Participant's Spouse, Depend-
ent or Beneficiary (whichever is applicable) in the percentage of Participant's Employer's contribu-
tion which has vested pursuant to the vesting schedule specified in the Employer's Plan. A Partici-
pant shall, at all times, have a one hundred percent (100%) Nonforfeitable Interest in the Partici-
pant's own contributions.
(h) "Spouse" means the Participant's lawful spouse as determined under the laws of the state in
which the Participant has his primary place of residence.
(i) "Trust" means the trust established by this Declaration.
m "Trustee" means the Employer or the person or persons appointed by the Employer to serve in
that capacity.
5
VANTA GECARE RETIREMENT HEALTH SA VINGS PLAN
ARTICLE II
Establishment of Trust
2.1 The Trust is hereby established as of the date set forth above for the exclusive benefit of Partici-
pants, their Spouses, Dependents and Beneficiaries.
ARTICLE III
Construction
3.1 This Trust and its validity, construction and effect shall be governed by the laws of the State of
~loC"\~
State
3.2 Pronouns and other similar words used herein in the masculine gender shall be read as the feminine
gender where appropriate, and the singular form of words shall be read as the plural where appropriate.
3.3 If any provision of this Trust shall be held illegal or invalid for any reason, such determination shall
not affect the remaining provisions, and such provisions shall be construed to effectuate the purpose of
this Trust.
ARTICLE IV
Benefits
4.1 Benefits. This Trust may provide benefits to the Participant, the Participant's Spouse, Dependents and
Beneficiary(ies) pursuant to the terms of the Plan.
4.2 Form of Benefits. This Trust may provide benefits by cash payment. This Trust may reimburse the
Participant, his Spouse, Dependents or Beneficiary(ies) for insurance premiums or other payments ex-
pended for permissible benefits described under the Plan. This trust may reimburse the Employer, or the
Administrator for insurance premiums.
ARTICLE V
General Duties
5.1 It shall be the duty of the Trustee to hold title to assets held in respect of the Plan in the Trustee's name
as directed by the Employer or its designees in writing. The Trustee shall not be under any duty to com-
pute the amount of contributions to be paid by the Employer or to take any steps to collect such amounts
as may be due to be held in trust under the Plan. The Trustee shall not be responsible for the custody,
investment, safekeeping or disposition of any assets comprising the Trust, to the extent such functions are
performed by the Employer or the Administrator, or both.
5.2 It shall be the duty of the Employer, subject to the provisions of the Plan, to pay over to the Adminis-
trator or other person designated hereunder from time to time the Employer's contributions and Partici-
pants' contributions under the Plan and to inform the Trustee in writing as to the identity and value of the
assets titled in the Trustee's name hereunder and to keep accurate books and records with respect to the
Participants of the Plan.
6
RETAIN BOOKLET
ARTICLE VI
Investments
6.1 The Employer may appoint one or more investment managers to manage and control all or part of the
assets of the Trust and the Employer shall notify the Trustee in writing of any such appointment.
6.2 The Trustee shall not have any discretion or authority with regard to the investment of the Trust and
shall act solely as a directed Trustee of the assets of which it holds title. To the extent directed by the
Employer (or Participants, their Spouses and Dependents, or Beneficiaries to the extent provided herein)
the Trustee is authorized and empowered with the following powers, rights and duties, each of which the
Trustee shall exercise in a nondiscretionary manner:
(a) To cause stocks, bonds, securities, or other investments to be registered in its name as Trustee
or in the name of a nominee, or to take and keep the same unregistered;
(b) To employ such agents and legal counsel as it deems advisable or proper in connection with its
duties and to pay such agents and legal counsel a reasonable fee. The Trustee shall not be
liable for the acts of such agents and counselor for the acts done in good faith and in reliance
upon the advice of such agents and legal counsel, provided it has used reasonable care in
selecting such agents and legal counsel;
(c) To exercise where applicable and appropriate any rights of ownership in any contracts of
insurance in which any part of the Trust may be invested and to pay the premiums thereon;
and
(d) At the direction of the Employer (or Participants, their Spouses, their Dependents, their Benefi-
ciaries, or the investment manager, as the case may be) to sell, write options on, conveyor
transfer, invest and reinvest any part thereof in each and every kind of property, whether real,
personal or mixed, tangible or intangible, whether income or non-income producing and
wherever situated, including but not limited to, time deposits (including time deposits in the
Trustee or its affiliates, or any successor thereto, if the deposits bear a reasonable rate of
interest), shares of common and preferred stock, mortgages, bonds, leases, notes, debentures,
equipment or collateral trust certificates, rights, warrants, convertible or exchangeable securi-
ties and other corporate, individual or government securities or obligations, annuity, retire-
ment or other insurance contracts, mutual funds (including funds for which the Trustee or its
affiliates serve as investment advisor, custodian or in a similar or related capacity), or in units
of any other common, collective or commingled trust fund,
6.3 Notwithstanding anything to the contrary herein, the assets of the Plan shall be held by the Trustee as
title holder only. Persons holding custody or possession of assets titled to the Trust shall include the
Employer, the Administrator, the investment manager, and any agents and subagents, but not the Trustee.
The Trustee shall not be responsible or liable for any loss or expense which may arise from or result from
compliance with any direction from the Employer, the Administrator, the investment manager, or such
agents to take title to any assets nor shall the Trustee be responsible or liable for any loss or expense
which may result from the Trustee's refusal or failure to comply with any direction to hold title, except if
the same shall involve or result from the Trustee's negligence or intentional misconduct. The Trustee may
refuse to comply with any direction from the Employer, the Administrator, the investment manager, or
such agents in the event that the Trustee. in its sole and absolute discretion, deems such direction illegal.
6.4 The Employer hereby indemnifies and holds the Trustee harmless from any and all actions, claims,
demands, liabilities, losses, damages or reasonable expenses of whatsoever kind and nature in connection
with or arising out of (i) any action taken or omitted in good faith by the Trustee in accordance with the
directions of the Employer or its agents and subagents hereunder, or (ii) any disbursements of any part of
the Trust made by the Trustee in accordance with the directions of the Employer, or (iii) any action taken
by or omitted in good faith by the Trustee with respect to an investment managed by an investment
manager in accordance with any direction of the investment manager or any inaction with respect to any
7
VA-N~TAGECARE RETIREMENT HEALTH SAVl^TCS PLAN
such investment in the absence of directions from the investment manager. Notwithstanding anything to
the contrary herein, the Employer shall have no responsibility to the Trustee under the foregoing indemni-
fication if the Trustee fails negligently, intentionally or recklessly to perform any of the duties undertaken
by it under the provisions of this Trust.
6.5 Notwithstanding anything to the contrary herein, the Employer or, if so designated by the Employer,
the Administrator and the investment manager or another agent of the Employer, will be responsible for
valuing all assets so acquired for all purposes of the Trust and of holding, investing, trading and disposing
of the same. The Employer will indemnify and hold the Trustee harmless against any and all claims,
actions, demands, liabilities, losses, damages, or expenses of whatsoever kind and nature, which arise
from or are related to any use of such valuation by the Trustee or holding, trading, or disposition of such
assets.
6.6 The Trustee shall and hereby does indemnify and hold harmless the Employer from any and all ac-
tions, claims, demands, liabilities, losses, damages and reasonable expenses of whatsoever kind and
nature in connection with or arising out of (a) the Trustee's failure to follow the directions of the Employer,
the Administrator, the investment manager, or agents thereof, except as permitted by the last sentence of
Section 6.3 above; (b) any disbursements made without the direction of the Employer, the Administrator,
the investment manager or agents thereof; and (c) the Trustee's negligence, willful misconduct, or reck-
lessness with respect to the Trustee's duties under this Declaration.
ARTICLE VII
Contributions
7.1 Employer Contributions. The Employer shall contribute to the Trust such amounts as specified in the
Plan or by resolution.
7.2 Participant Contributions. If specified in the Plan, each Participant may make voluntary after-tax
contributions. Under no circumstances shall Participant Contributions exceed an insubstantial amount.
These contributions shall be collected by the Employer and remitted to the Trust for deposit at such time
or times as required under the terms of the Plan.
7.3 Accrued Leave. Contributions up to an amount equal to the value of accrued sick leave, vacation
leave, or other type of accrued leave, as permitted under the Plan. The Employer's Plan must provide a
formula for determining the value of the Participant's contribution of accrued leave. The Employer's Plan
must contain a forfeiture provision that will prevent Participants from receiving the accrued leave in cash
in lieu of a contribution to the Trust.
7.4 Accounts. Employer contributions, Participant contributions, and contributions of accrued leave, all
investment income and realized and unrealized gains and losses, and forfeitures allocable thereto will be
deposited into an Account in the name of the Participant for the exclusive benefit of the Participant, his
Spouse, Dependents and Beneficiaries, The assets in each Participant's Account may be invested in
Investment Funds as directed by the Participant (or, after the Participant's death, by the Spouse,
Dependents or Beneficiaries) from among the Investment Funds selected by the Employer.
7.5 Receipt of Contributions. The Employer or, if so designated by the Employer, the Administrator or
investment manager or another agent of the Employer, shall receive all contributions paid or delivered to
it hereunder and shall hold, invest. reinvest and administer such contributions pursuant to this Declara-
tion, without distinction between principal and income. The Trustee shall not be responsible for the
calculation or collection of any contribution under the Plan, but shall hold title to property received in
respect of the Plan in the Trustee's name as directed by the Employer or its designee pursuant to this
Declaration.
8
RETAIN BOOKLET
7.6 No amount in any Account maintained under this Trust shall be subject to transfer, assignment, or
alienation, whether voluntary or involuntary, in favor of any creditor, transferee, or assignee of the Em-
ployer, the Trustee, any Participant, his Spouse, Dependent. or Beneficiaries.
7.7 Upon the satisfaction of all liabilities under the Plan to provide such benefits, any amount of Employer
contributions, plus accrued earnings thereon, remaining in such separate Accounts must, under the terms
of the Plan, be returned to the Employer.
ARTICLE VIII
Other Plans
If the Employer hereafter adopts one or more other plans providing life, sickness, accident, medical,
disability, severance, or other benefits and designates the Trust hereby created as part of such other plan,
the Employer or, if so designated by the Employer, the Administrator or an investment manager or an-
other agent of the Employer shall, subject to the terms of this Declaration, accept and hold hereunder
contributions to such other plans. In that event (a) the Employer or, if so designated by the Employer, the
Administrator or an investment manager or another agent of the Employer, may commingle for invest-
ment purposes the contributions received under such other plan or plans with the contributions previously
received by the Trust, but the books and records of the Employer or, if so designated by the Employer, the
Administrator or an investment manager or another agent of the Employer, shall at all times show the
portion of the Trust Fund allocable to each plan; (b) the term "Plan" as used herein shall be deemed to
refer separately to each other plan; and (c) the term "Employer" as used herein shall be deemed to refer to
the person or group of persons which have been designated by the terms of such other plans as having
the authority to control and manage the operation and administration of such other plan.
ARTICLE IX
Disbursements and Expenses
9.1 The Employer or its designee shall make such payments from the Trust at such time to such persons
and in such amounts as shall be authorized by the provisions of the Plan provided, however, that no
payment shall be made, either during the existence of or upon the discontinuance of the Plan (subject to
Section 7.7), which would cause any part of the Trust to be used for or diverted to purposes other than the
exclusive benefit of the Participants, their Spouses and Dependents, and Beneficiaries pursuant to the
provisions of the Plan.
9.2 All payments of benefits under the Plan shall be made exclusively from the assets of the Accounts of
the Participants to whom or to whose Spouse, Dependents, or Beneficiaries such payments are to be
made, and no person shall be entitled to look to any other source for such payments.
9.3 The Employer, Trustee and Administrator may be reimbursed for expenses reasonably incurred by
them in the administration of the Trust. All such expenses, including, without limitation, reasonable fees
of accountants and legal counsel to the extent not otherwise reimbursed, shall constitute a charge against
and shall be paid from the Trust upon the direction of the Employer.
ARTICLE X
Accounting
10.1 The Trustee shall not be required to keep accounts of the investments, receipts, disbursements, and
other transactions of the Trust, except as necessary to perform its title-holding function hereunder. All
accounts, books, and records relating thereto shall be maintained by the Employer or its designee.
9
VANTA GECARE RETIREMENT HEALTH SA VINGS PLAN
10.2 As promptly as possible following the close of each year, the Trustee shall file with the Employer a
written account setting forth assets titled to the Trust as reported to the Trustee by the Employer or its
designee.
ARTICLE XI
Miscellaneous Provisions
11.1 Neither the Trustee nor any affiliate thereof shall be required to give any bond or to qualify before, be
appointed by, or account to any court of law in the exercise of its powers hereunder.
11.2 No person transferring title or receiving a transfer of title from the Trustee shall be obligated to look
to the propriety of the acts of the Trustee in connection therewith.
11.3 The Employer may engage the Trustee as its agent in the performance of any duties required of the
Employer under the Plan, but such agency shall not be deemed to increase the responsibility or liability of
the Trustee under this Declaration.
11.4 The Employer shall have the right at all reasonable times during the term of this Declaration and for
three (3) years after the termination of this Declaration to examine, audit, inspect, review, extract informa-
tion from, and copy all books, records, accounts, and other documents of the Trustee relating to this
Declaration and the Trustees' performance hereunder.
ARTICLE XII
Amendment and Termination
12.1 The Employer reserves the right to alter, amend, or (subject to Section 9.1) terminate this Declaration
at any time for any reason without the consent of the Trustee or any other person, provided that no
amendment affecting the rights, duties, or responsibilities of the Trustee shall be adopted without the
execution of the Trustee to the amendment. Any such amendment shall become effective as of the date
provided in the amendment, if requiring the Trustee's execution, or on delivery of the amendment to the
Trustee, if the Trustee's execution is not required.
12.2 Upon termination of this Declaration and upon the satisfaction of all liabilities under the Plan to
provide such benefits, any amount of Employer contributions, plus accrued earnings thereon, remaining
in such separate Accounts must, under the terms of the Plan, be returned to the Employer.
ARTICLE XIII
Successor Trustees
13.1 The Employer reserves the right to discharge the Trustee for any or no reason, at any time by giving
ninety (90) days' advance written notice.
13.2 The Trustee reserves the right to resign at any time by giving ninety (90) days' advance written notice
to the Employer.
13.3 In the event of discharge or resignation of the Trustee, the Employer may appoint a successor Trus-
tee who shall succeed to all rights, duties, and responsibilities of the former Trustee under this Declara-
tion, and the terminated Trustee shall be deemed discharged of all duties under this Declaration and
responsibilities for the Trust.
10
RETAIN BOOKLET
ARTICLE XIV
Limited Effect of Plan and Trust
Neither the establishment of the Plan and the Trust or any modification thereof, the creation of any fund or
account, nor the payment of any benefits, shall be construed as giving to any person covered under the
Plan or other person any legal or equitable right against the Trustee, the Administrator, the Employer or
any officer or employee thereof, except as may otherwise be expressly provided in the Plan or in this
Declaration.
ARTICLE XV
Protective Clause
Neither the Administrator, the Employer, nor the Trustee shall be responsible for the validity of any con-
tract of insurance or other arrangement maintained in connection with the Plan, or for the failure on the
part of the insurer or provider to make payments provided by such contract, or for the action of any per-
son which may delay payment or render a contract void or unenforceable in whole or in part.
'1
VANTAGECARE RETIREMENT HEALTH SA VINGS PLAN
IN WITNESS WHEREOF, the Employer and the Trustee have executed this Declaration by their respective
duly authorized officers, as of the date first hereinabove mentioned.
EMPLOYER:
By: Title:
TRUSTEES:
By: Title:
By: Title:
By: Title:
12
RETAIN BOOKLET
Internal Revenue Service
Department of the Treasury
Index Number: 115.02-00
Washington, DC 20224
Contact Person:
t>
Telephone Number:
In Reference to:
CC:DOM:FI&P:2 PLR-116685-99
Date:
December 28, 1999
City
Trust =
State =
Dear
This is in response to a letter dated October 12, 1999, and
prior correspondence, requesting a private letter ruling that
Trust is an integral part cf City.
FACTS
City is a political subdivision of S:ate. City currently
maintains one or more post-retirement welfare benefit plans
(collectively, the "Plan") that provide its eligible employees
("Participants") and their beneficiaries ("Beneficiaries") with
life, sickness, medica:, disability, severance and other similar
benefits through insurance and self-funded reimbursement plans.
City intends to establish Trust to hold assets and income of
the Plan for the exclusive benefit of Participants and their
Beneficiaries.
Trust's Declaration defines "Beneficiaries" ~c ~~clude a
Participant's spouse, any child of the Participan~ or the
Pa:?:"ticipant's spouse who is a mino:?:" or a student within the
meaning of section 151 (c) (4) of the Internal Revenue Cede, ii;.y
ether minor child residing wich che Parcicipant, and any ctier
individual who is a person described in section 152(a) of the
Code. Death benefits may be provided to any Beneficiary
designated by a Participant under the terms of a death benef::
F~JgYam O~ an i~surance co~t~ac~ fo~mi~g pa~: of ~~e P~~~. _~~~:
13
VXNYA~c;b' CiCR-E-R E T 1 R-E-MYiv T-HEATT-H-Sj(viNGS P LAN
PLR - 11 6685 - 9 9
2
may provide benefits by cash payment, and may reimburse a
Participant, City, or Trust's Administrato>> for insurance
premiums or other payments expended for permissible benefits
under the Plan.
Under Trust's Declaration, City will be the Administrator of
Trust. City may appoint one or more investment managers to
manage and control all or part o~ the assets of Trust. Under
Trust's Declaration, the Trustee will hold assets only as
titleholder. Persons having custody or possession of assets may
include City, the Administrator of Trust, the investment manager,
and their agents and subagents, but not the Trustee. The Trustee
will have no discretion or authority with regard to the
investments of Trust and will act solely as a directed Trustee
with respect to the assets to which it holds title.
The Trustee will not be responsible or liable for any loss
or expense that may arise or result from complying with any
direction from the City, the Administrator, the investment
manager, or such agents to take title to any assets, or from the
Trustee's refusal or failure to comply with any direction to hold
title, unless it involves or results from the Trustee's
negligence or intentional misconduct. The Trustee may refuse to
comply with any direction if it deems such direction illegal.
City indemnifies and holds the Trustee harmless from any
actions, claims, demands, liabilities, losses, damages or
reasonable expenses of any kind in connection with or arising out
of (i) any action taken or omitted in good faith in accordance
with its directions, (ii) any disbursements made in accordance
with directions, or (iii) any action taken by or omitted by the
Trustee with respect to an investment managed by an investment
manager in accordance with any direction of the investment
manager or any inaction regarding any investment in the absence
of directions from the in~estment manager. City, however, has no
responsibility to the Trustee under the indemnification if the
~rustee fails negligently, intentionally, or reckless to perform
lts duties.
City will contribute to Trust such amounts as specified in
the Plan or by resolution. No other person or persons will be
permitted to make any contribu~ions.
The Plan must provide a formula for determining the val~e of
a Participant's accrued vacation leave, sick leave, or both, in
eXcess of a threshold number of hours of such leave. City ~ay
Contribute amounts so determined to Trust. The Plan will con~a~~
a forfeiture provision that will prevent Participants and their
Beneficiaries from receivina cash in lieu cf a contribut~cn to
Trust in their behalf. Contributions, investment income,
realizec and unrealized gains and losses, and forfeit~~~s ~~i:l ~e
deposited into an account i~ T~ust in the "-arne or t~e ?a~::c:~a~:
14
R~EYA7N-B-O-o7(LrT
PLR-116685-99
3
for the exclusive benefit of the Participant and his or her
Beneficiaries. A Participant may direct the investment of
amounts in her or his account among investments selected by City.
No amount in any account will be subject to transfer, assignment,
or alienation, whether voluntary or involuntary, in favor of any
creditor, transferee, or assignee of City, the Trustee,
Participant or Beneficiary.
City or the Administrator, investment manager, or other
agent designated by City will receive contributions and will
hold, invest, and administer contributions without distinction
between principal and income. The Trustee will not be
responsible for the calculation or collection of contributions,
but will hold title to property received as directed by City or
its designee. The Trustee will not be required to keep accounts
of the investments, receipts, disbursements, and other
transaction of Trust except as necessary to perform its title-
holding function. City or its designee will maintain all books
and records.
City reserves the right to alter, amend, or terminate Trust
at any time for any reason without the consent of any persor.. No
amendment affecting the Trustee is effective without the
Trustee's consent, and no termination can result in any part of
Trust's assets being used for or diverted to purposes other than
the exclusive benefit of Participants and Beneficiaries.
If City adopts other plans providing life, sickness,
accident, medical, disability, severance, or other benefits and
designates Trust as part of such plan, City or its agent will
hold contributions to such plan in Trust. The contributions may
be commingled for investment purposes, but the books and record
of Trust must show the portion of Trust allocable to each plan.
Upon the satisfaction of all liabilities under the Plan ~c
provide benefits, any amounts remaining in any account mus~ be
returned to City.
LAW & ANALYSIS
Income of an integral part of a state or political
subdivision of a state is not taxable absent specific s~atu~cry
authorization. See Rev. Rul. 87-2, 1987-1 C.B. 18i se~tion
SII(a) (2) (B) of the Code, GeM 14407, C.B. XIV-I, 103 (1935),
superseded by Rev. Rul. 71-131, 1971-1 C.B. 28. Whether an
enterprise is an integral part depends on facts and circumstances
such as the state's degree of control over the enterprise and its
financial commitment to the enterprise. If an enterpris~ is an
integral part of a State or political subdivision of a state, it
will net be treated as a separate entity for federal tax
purpeses, thcugh it may have been fermed as a separate en:~:;.
15
V"l"ll"j-tt"c;-'x."LIi-J'("x.-l'(-r..-J-l-l("'P]:;"l",i".cj"-J-n"]:;-Ji-LJ- n-:> -/l-v"JJ,,rC:;--;j-r-L-/il"
PLR-116685-99
4
under state law. Section 301.7701-1(a) (3) of the Procedural and
Administrative Regulations.
City has made a substantial financial commitment to Trust by
providing all of its funding. City retains complete control over
Trust because it may amend or terminate Trust at any time. City
retains control over the daily operation of Trust by its power to
appoint or remove agents who manage daily operation. The Trustee
is merely a title holder with no power to manage Trust.
CONCLUSION
Provided that City is the only person that makes
contributions to Trust, and Trust accepts or holds only amounts
of money contributed by City, Trust will be an integral part of
City, and any income earned on amounts in Trust will not be
subject to federal income tax.
This ruling is directed only to the, taxpayer that requested
it. Section 6110 (k) (3) of the Code provides that it may not be
used or cited as precedent.
Except as specifically provided otherwise, no opinion is
expressed on the federal income tax consequences of the
transactior. described above.
In accordance with the terms of a power of attorney on file
in this office, a copy of thO letter is being sent to your
authorized representative.
Sincerely,
Assistant Chief Counsel
(Financial Institutions & Products)
By: William Coppersmith
William E. Coppersmith
Chief, Branch 2
16
J(~J:.llrnV-I$-U-u-Ji.-L-J:.-l
REnREE MEDICAL AND DENTAL EXPENSE REIMBURSEMENT PLAN
17
VANTAGECARE RETIREMENT HEALTH SA VINGS PLAN
RETIREE MEDICAL AND DENTAL EXPENSE REIMBURSEMENT PLAN
Article I Preamble
1.01 Establishment of Plan
1.02 Purpose of Plan
Article II Definitions
2.01 "Beneficiary
2.02 "Benefits"
2.03 "Code"
2.04 "Dependent"
2.05 "Eligible Medical or Dental Expenses"
2.06 "Employer"
2.07 "Entry Date"
2.08 "Participant"
2.09 "Plan Administrator"
2.10 "Plan Year"
2.11 "Retiree"
2.12 "Spouse"
Article III Eligibility
3.01 General Requirements
Article IV Amount of Benefits
4.01 Annual Benefits Provided by the Plan
4.02 Cost of Coverage
Article V Payment of Benefits
5.01 Eligibility for Benefits
5.02 Claims for Benefits
Article VI Plan Administration
6.01 Allocation of Authority
6.02 Provision for Third-Party Plan Service Providers
6.03 Several Fiduciary Liability
6.04 Compensation of Plan Administrator
6.05 Bonding
6.06 Payment of Administrative Expenses
6.07 Timeliness of Payments
6.08 Annual Statements
Article VI Claims Procedure
7.01 Procedure if Benefits are Denied Under the Plan
7.02 Requirement for Written Notice of Claim Denial
7.03 Right to Request Hearing on Benefit Denial
7.04 Disposition of Disputed Claims
7 .05 Preservation of Other Remedies
Article VIII Amendment or Termination of Plan
8.01 Permanency
8.02 Employer's Right to Amend
8.03 Employer's Right to Terminate
18
RETAIN BOOKLET
Article IX General Provisions
9.01 No Employment Rights Conferred
9.02 Payments to Beneficiary
9.03 Nonalienation of Benefits
9.04 Mental or Physical Incompetency
9.05 Inability to Locate Payee
9.06 Requirement of Proper Forms
9.07 Source of Payments
9.08 Tax Effects
9.09 Multiple Functions
9.10 Gender and Number
9.11 Headings
9.12 Applicable Laws
9.13 Severability
19
VANTAGECARE RETIREMENT HEALTH SA VINGS PLAN
ARTICLE I
Preamble
THIS INSTRUMENT made and published by Cl'~ D ~ SL1..~ L'k.> '"EUu:.h.
"Employer") on the _ day of , 20~, creates the
and Dental Expense Reimbursement Plan, as follows:
(hereinafter called
Retiree Medical
1.01 Establishment of Plan
The Employer named above hereby establishes a Retiree Medical and Dental Expense Reimbursement
Plan as of the day of , 20~.
1.02 Purpose of Plan
This Plan has been established to reimburse the eligible Retirees of the Employer for medical and dental
expenses incurred by them, their Spouses, Dependents, and Beneficiaries pursuant to the Employer's
VantageCare Retirement Health Savings (RHS) Plan.
ARTICLE II
Definitions
The following words and phrases as used herein shall have the following meanings, unless a different
meaning is plainly required by the context:
2.01 "Beneficiary" means the person or persons designated pursuant to the terms of the Plan, who will
receive any Benefits payable hereunder in the event of the Participant's death. A Beneficiary may also
designate a beneciary(ies) to receive any benefits payable hereunder in the event of the preceeding Ben-
eficiary's death until the satisfaction of all liabilities under the plan to provide benefits.
2.02 "Benefits" means any amounts paid to a Participant or Beneficiary in the Plan as reimbursement for
Eligible Medical and Dental Expenses incurred by the Participant or Beneficiary during a Plan Year by him,
his Spouse, his Dependents, or his Beneficiary.
2.03 "Code" means the Internal Revenue Code of 1986, as amended,
2.04 "Dependent" means any individual who is a dependent of the Participant within the meaning of Code
Sec. 152.
2.05 "Eligible Medical or Dental Expenses" means those expenses designated by the Employer as eligible
for reimbursement in the VantageCare Retirement Health Savings Plan Adoption Agreement.
2.06 "Employer" means the unit of state or local government creating this Plan, or any affiliate or succes-
sor thereof that likewise adopts this Plan.
2.07 "Entry Date" means the first day the Participant meets the eligibility requirements of Article III as of
such Date.
2.08 "Participant" means any Retiree who has met the eligibility requirements set forth in Article III.
2.09 "Plan Administrator" means the Employer or other person appointed by the Employer who has the
authority and responsibility to manage and direct the operation and administration of the Plan.
20
RETAIN BOOKLET
2.10 "Plan Year" means the annual accounting period of the Plan, which begins on the \ ~.t- day of
r-Q.'<\'\.H~~ ,20 EZ-, and ends on the k?+ day of 'b.z.<:''!'',1'\b,',- ,20E..L, with respect to the first
Plan Year, and thereafter as long as this Plan remains in effect, the period that begins on
and ends on
2.11 "Retiree" means any individual who, while in the service of the Employer, was considered to be in a
legal employer-employee relationship with the Employer for federal withholding tax purposes, and who
was part of the classification of employees designated as covered by the Employer's VantageCare Retire-
ment Health Savings Plan.
2.12 "Spouse" means the Participant's lawful spouse as determined under the laws of the state in which
the Participant has his primary place of residence.
All other defined terms in this Plan shall have the meanings specified in the various Articles of the Plan in
which they appear.
ARTICLE III
Eligibility
Each Retiree who meets the eligibility requirements outlined in the Employer's VantageCare Retirement
Health Savings Plan shall be eligible to participate in this Plan.
ARTICLE IV
Amount of Benefits
4.01 Annual Benefits Provided by the Plan
Each Participant shall be entitled to reimbursement for his documented, Eligible Medical or Dental Ex-
penses incurred during the Plan Year in an annual amount not to exceed the account balance of the Partici-
pant in the Employer's VantageCare Retirement Health Savings Plan.
4.02 Cost of Coverage
The expense of providing the benefits set out in Section 4.01 shall be contributed as outlined in the Em-
ployer's VantageCare Retirement Health Savings Plan.
ARTICLE V
Payment of Benefits
5.01 Eligibility for Benefits
(a) Each Participant in the Plan shall be entitled to a benefit hereunder for all Eligible Medical and
Dental Expenses incurred by the Participant on or after the Entry Date of his or her participa-
tion, (and after the effective date of the Plan) subject to the limitations contained in this Article
V, regardless whether the mental or physical condition for which the Participant makes applica-
tion for benefits under this Plan was detected, diagnosed. or treated before the Participant
became covered by the Plan.
(b) In order to be eligible for benefits, the Participant must meet the benefit eligibility criteria
outlined in the Employer's VantageCare Retirement Health Savings Plan Adoption Agreement.
21
VANTAGECARE RETIREMENT HEALTH SAVINGS PLAN
(c) A Participant who becomes totally and permanently disabled (as defined by the Social Security
Administration) will become immediately eligible to receive medical benefit payments from the
Plan. Pursuant to Section 9.02 and Employer's VantageCare Retirement Health Savings Plan
Adoption Agreement, the surviving Spouse and Dependents, or Beneficiary(ies) shall become
immediately eligible to receive or to continue receiving medical benefit payments from the
Plan upon the death of the Participant.
5.02 Claims for Benefits
No benefit shall be paid hereunder unless a Participant. his Spouse. Dependent or Beneficiary has first
submitted a written claim for benefits to the Plan Administrator on a form specified by the Plan Adminis-
trator, and pursuant to the procedures set out in Article VI. below. Upon receipt of a properly documented
claim, the Plan Administrator shall pay the Participant. his Spouse, Dependent or Beneficiary the benefits
provided under this Plan as soon as is administratively feasible.
ARTICLE VI
Plan Administration
6.01 Allocation of Authority
The Employer shall control and manage the operation and Administration of the Plan. The Employer shall
have the exclusive right to interpret the Plan and to decide all matters arising thereunder, including the
right to remedy possible ambiguities, inconsistencies, or omissions. All determinations of the Employer
with respect to any matter hereunder shall be conclusive and binding on all persons.
Without limiting the generality of the foregoing. the Employer shall have the following powers and duties:
(a) To decide on questions concerning the Plan and the eligibility of any Employee to participate in
the Plan, in accordance with the provisions of the Plan;
(b) To determine the amount of benefits that shall be payable to any person in accordance with the
provisions of the Plan; to inform the Plan Administrator, as appropriate, of the amount of such
Benefits; and to provide a full and fair review to any Participant whose claim for benefits has
been denied in whole or in part; and
(c) To designate other persons to carry out any duty or power which would otherwise be a fiduci-
ary responsibility of the Plan Administrator, under the terms of the Plan.
(d) To require any person to furnish such reasonable information as it may request for the purpose
of the proper administration of the Plan as a condition to receiving any benefits under the Plan;
(e) To make and enforce such rules and regulations and prescribe the use of such forms as he
shall deem necessary for the efficient administration of the Plan,
6.02 Provision for Third-Party Plan Service Providers
The Plan Administrator, subject to approval of the Employer, may employ the services of such persons as
it may deem necessary or desirable in connection with operation of the Plan. The Plan Administrator, the
Employer (and any person to whom it may delegate any duty or power in connection with the administra-
tion of the Plan), and all persons connected therewith may rely upon all tables, valuations, certificates,
reports and opinions furnished by any duly appointed actuary, accountant, (including Employees who are
actuaries or accountants). consultant, third party administration service provider, legal counsel, or other
specialist, and they shall be fully protected in respect to any action taken or permitted in good faith in
reliance thereon. All actions so taken or permitted shall be conclusive and binding as to all persons.
22
RETAIN BOOKLET
6.03 Several Fiduciary liability
To the extent permitted by law. neither the Plan Administrator nor any other person shall incur any liability
for any acts or for failure to act except for his own willful misconduct or willful breach of this Plan.
6.04 Compensation of Plan Administrator
Unless otherwise agreed to by the Employer. the Plan Administrator shall serve without compensation for
services rendered in such capacity. but all reasonable expenses incurred in the performance of his duties
shall be paid by the Employer.
6.05 Bonding
Unless otherwise determined by the Employer. or unless required by any Federal or State law, the Plan
Administrator shall not be required to give any bond or other security in any jurisdiction in connection
with the administration of this Plan.
6.06 Payment of Administrative Expenses
All reasonable expenses incurred in administering the Plan. including but not limited to administrative
fees and expenses owing to any third party administrative service provider. actuary, consultant, account-
ant, attorney, specialist, or other person or organization that may be employed by the Plan Administrator
in connection with the administration thereof, shall be paid by the Employer, provided, however that each
Participant shall bear the monthly cost (if any) charged by a third party administrator for maintenance of
his Benefit Account unless otherwise paid by the Employer.
6.07 Timeliness of Payment for Benefits
Payment for Benefits shall be made as soon as administratively feasible after the required forms and
documentation have been received by the Plan Administrator.
6.08 Annual Statements
The Plan Administrator shall furnish each Participant with an annual statement of his medical and dental
expense reimbursement account within ninety (90) days after the close of each Plan Year.
ARTICLE VII
Claims Procedure
7.01 Procedure if Benefits are Denied Under the Plan
Any Participant, Spouse, Dependent, or Beneficiary, or his duly authorized representative may file a claim
for a plan benefit to which the claimant believes that he is entitled. Such a claim must be in writing on a
form provided by the Plan Administrator and delivered to the Plan Administrator, in person or by mair,
postage paid. Within thirty (30) days after receipt of such claim, the Plan Administrator shall send to the
claimant, by mail, postage prepaid, notice of the granting or denying, in whole or in part, of such claim,
unless special circumstances require an extension of time for processing the claim. In no event may the
extension exceed ninety (90) days from the end of the initial period. If such extension is necessary, the
claimant will be given a written notice to this effect prior to the expiration of the initial 30-day period. The
Plan Administrator shall have full discretion to deny or grant a claim in whole or in part. If notice of the
denial of a claim is not furnished in accordance with this Section, the claim shall be deemed denied and
the claimant shall be permitted to exercise his right to review pursuant to Sections 7.03 and 7.04.
23
VANTAGECARE RETIREMENT HEALTH SAVINGS PLAN
7.02 Requirement for Written Notice of Claim Denial
The Plan Administrator shall provide, to every claimant who is denied a claim for benefits, written notice
setting forth in a manner calculated to be understood by the claimant:
(a) The specific reason or reasons for the denial;
(b) Specific reference to pertinent Plan provisions on which the denial is based;
(c) A description of any additional material of information necessary for the claimant to perfect the
claim and an explanation of why such material is necessary, and
(d) An explanation of the Plan's claim review procedure.
7.03 Right to Request Hearing on Benefit Denial
Within sixty (60) days after the receipt by the claimant of written notification of the denial (in whole or in
part) of his claim, the claimant or his duly authorized representative, upon written application to the Plan
Administrator, in person or by certified mail, postage prepaid, may request a review of such denial, may
review pertinent documents, and may submit issues and comments in writing.
7.04 Disposition of Disputed Claims
Upon its receipt of notice of a request for review. the Plan Administrator shall make a prompt decision on
the review. The decision on review shall be written in a manner calculated to be understood by the claim-
ant and shall include specific reasons for the decision and specific references to the pertinent plan provi-
sions on which the decision is based. The decision on review shall be made not later than sixty (60) days
after the Plan Administrator's receipt of a request for a review, unless special circumstances require an
extension of time for processing, in which case a decision shall be rendered not later than one hundred-
twenty (120) days after receipt of a request for review. If an extension is necessary. the claimant shall be
given written notice of the extension prior to the expiration of the initial sixty (60) day period. If notice of
the decision on the review is not furnished in accordance with this Section, the claim shall be deemed
denied and the claimant shall be permitted to exercise his right to legal remedy pursuant to Section 7.05.
7.05 Preservation of Other Remedies
After exhaustion of the claims procedures provided under this Plan, nothing shall prevent any person from
pursuing any other legal or equitable remedy otherwise available.
ARTICLE VIII
Amendment or Termination of Plan
8.01 Permanency
While the Employer fully expects that this Plan will continue indefinitely. due to unforeseen, future busi-
ness contingencies, permanency of the Plan will be subject to the Employer's right to amend or terminate
the Plan, as provided in Sections 8.02 and 8.03, below.
8.02 Employer's Right to Amend
The Employer reserves the right to amend the Plan at any time and from time-to-time. and retroactively if
deemed necessary or appropriate to meet the requirements of the Code. or any similar provisions of
subsequent revenue or other laws, or the rules and regulations in effect under any of such laws or to
conform with governmental regulations or other policies, to modify or amend in whole or in part any or all
of the provisions of the Plan.
24
RETAIN BOOKLET
8.03 Employer's Right to Terminate
The Employer reserves the right to discontinue or terminate the Plan at any time without prejudice.
ARTICLE IX
General Provisions
9.01 No Employment Rights Conferred
Neither this Plan nor any action taken with respect to it shall confer upon any person the right to be con-
tinued in the employment of the Employer.
9.02 Payments After Death of Participant
Any benefits otherwise payable to a Participant following the date of death of such Participant shall be
paid as outlined in the Employer's VantageCare Retirement Health Savings Plan Adoption Agreement.
9.03 Nonalienation of Benefits
No benefit under the Plan shall be subject in any manner to anticipation, alienation, sale, transfer, assign-
ment, pledge, encumbrance or charge, and any attempt to do so shall be void. No benefit under the Plan
shall in any manner be liable for or subject to the debts, contracts, liabilities, engagements or torts of any
person. If any person entitled to benefits under the Plan becomes bankrupt or attempts to anticipate,
alienate, sell, transfer, assign, pledge, encumber or charge any benefit under the Plan, or if any attempt is
made to subject any such benefit to the debts, contracts, liabilities, engagements or torts of the person
entitled to any such benefit, except as specifically provided in the Plan, then such benefit shall cease and
terminate in the discretion of the Plan Administrator, and he may hold or apply the same or any part
thereof to the benefit of any dependent or beneficiary of such person, in such manner and proportion as
he may deem proper.
9.04 Mental or Physical Incompetency
If the Plan Administrator determines that any person entitled to payments under the Plan is incompetent
by reason of physical or mental disability, he may cause all payments thereafter becoming due to such
person to be made to any other person for his benefit, without responsibility to follow the application of
amounts so paid. Payments made pursuant to this Section shall completely discharge the Plan Adminis-
trator and the Employer.
9.05 Inability to locate Payee
If the Plan Administrator is unable to make payment to any Participant or other person to whom a pay-
ment is due under the Plan because he cannot ascertain the identity or whereabouts of such Participant or
other person after reasonable efforts have been made to identify or locate such person (including a notice
of the payment so due mailed to the last known address of such Participant or other person as shown on
the records of the Employer), such payment and all subsequent payments otherwise due to such Partici-
pant or other person shall be escheated under the laws of the State of the last known address of the
Participant or other persons eligible for benefits.
9.06 Requirement of Proper Forms
All communications in connection with the Plan made by a Participant shall become effective only when
duly executed on forms provided by and filed with the Plan Administrator.
25
VANTAGECARE RETIREMENT HEALTH SAVINGS PLAN
9.07 Source of Payments
The Employer shall be the sole source of benefits under the Plan. No Employee or Beneficiary shall have
any right to. or interest in, any assets of the Employer upon termination of employment or otherwise,
except as provided from time to time under the Plan. and then only to the extent of the benefits payable
under the Plan to such Employee or Beneficiary.
9.08 Tax Effects
Neither the Employer nor the Plan Administrator makes any warranty or other representation as to
whether any payments received by a Participant, his Spouse, Dependents, or Beneficiary(ies) hereunder
will be treated as includible in gross income for federal or state income tax purposes.
9.09 Multiple Functions
Any person or group of persons may serve in more than one fiduciary capacity with respect to the Plan.
9.10 Gender and Number
Masculine pronouns include the feminine as well as the neuter gender, and the singular shall include the
plural, unless indicated otherwise by the context.
9.11 Headings
The Article and Section headings contained herein are for convenience of reference only, and shall not be
construed as defining or limiting the matter contained thereunder.
9.12 Applicable Laws
The provisions of the Plan shall be construed, administered and enforced according to the laws of the
State of FlD'r~t1J>--
9.13 Severability
Should any part of this Plan subsequently be invalidated by a court of competent jurisdiction, the remain-
der thereof shall be given effect to the maximum extent possible.
IN WITNESS WHEREOF, we have executed this Plan Agreement the date and year first written above.
,
C\+'j c.~ <;''^'~~J 1:;:ks ~L\.el
(Employer)
By:
ATTEST
Secretary
26
-__-n
--
~.
-
~-
leMA RETIREMENT CORPORATION
777 North Capitol Street, NE
Washington, DC 20002
1-800-326- 7272
www.icmarc.org
BKTOOO-006-200212-765