§ 40-233. Optional Forms of Benefits.

(a)

Joint and Survivor Annuity. This form of benefit shall provide monthly payments of a smaller amount for the life of the Participant, with monthly payments continuing thereafter for the life of the Participant's designated beneficiary. The monthly benefit payable to the beneficiary shall be fifty (50) percent, sixty-six and two-thirds (66 2/3 ) percent, seventy-five (75) percent or one hundred (100) percent of the monthly benefit payable during the joint lives of the Participant and the beneficiary, as elected by the Participant. If payment of a pension is to be made in the form of a Joint and Survivor Pension, the pension amount shall be adjusted so as to be actuarially equivalent to the standard benefit. The standard pension benefit shall be ten (10) years certain and life.

(b)

Single Life Annuity. Any Participant may file an election to receive monthly payments for life.

(c)

Any other actuarially equivalent benefit approved by the Board or provided by F.S. § 185.161.

(d)

Deferred retirement option plan (DROP). A member may enter into the deferred retirement option plan (DROP), which plan is to be created and administered by the board of trustees of the fund on the first day of any month following the attainment of Normal Retirement Age as defined herein. The maximum duration of participation in the DROP shall not exceed five (5) years and participation will end if the employee resigns, dies or is terminated for just cause prior to completion of said five (5) years.

A member may participate in the plan only once and after commencement in the DROP he or she shall never have the right to be a contributing member of the Pension Plan again.

Upon the effective date of the commencement of participation in the DROP, membership in the Pension Plan shall terminate and neither employee nor employer contributions shall be payable.

The member contributions to the Trust Fund, including those picked up by the city, shall cease and instead of being paid to the Pension Plan, shall be paid to the employee. For purposes of this section, average monthly earnings and creditable service shall remain as they existed on the effective date of commencement of participation in the DROP. The monthly retirement benefits that would have been payable, had the member elected to cease employment and receive a service retirement allowance, shall be credited to a deferred retirement option account.

The deferred retirement option plan account shall, unless a member elects a self-directed DROP, earn interest at a rate set quarterly by the board of trustees. Such interest shall be equal to the Trust Fund's net rate of investment return for the year and shall be credited to each individual account balance in the account on a quarterly basis.

The DROP account shall not be subject to any fees, charges, etc., as established by the Board of Trustees.

If a Participant or DROP Participant elects a self-directed DROP, then the investments, any returns thereon, and the fees for administering the self-directed DROP shall be in accordance with the self-directed DROP options selected by the member or DROP participant. Neither the City, the Trust Fund nor the Board of Trustees shall have any responsibility or liability for any of the options selected by the Participant or DROP participant.

Participants electing a self-directed DROP must do so no later than thirty (30) days after DROP participation effective date.

Upon termination of employment, a participant in the DROP shall receive, at his or her option, a lump sum payment from the account equal to the payments to the account, plus earned interest, or an annuity based upon his or her account balance, or the participant may elect any other method of payment if approved by the board of trustees. The monthly benefits that were being paid into the fund during the period of participation shall begin being paid to the retiree.

If a participant dies during the period of participation in the DROP, a lump sum payment equal to his or her account balance shall be paid to the participant's named beneficiary, or, if none, to his or her estate; in addition, any survivor benefits selected by the participant shall be payable.

If employment is not terminated at the end of the period specified for participation in the DROP, payments into the account shall cease and no further interest shall be earned or credited to the individual account in the fund for the duration of employment. The amount in the DROP account shall not be payable to the individual until he or she terminates employment.

If a Participant dies after the period of participation in the plan but is still an employee, a lump sum payment equal to his or her account balance shall be paid to the employee's named beneficiary or, if none, to his or her estate, in addition, any survivor benefits selected by the participant shall be payable.

A Participant will no longer be required to make contributions to the plan, or, at his or her option, may be permitted to make reduced contributions to the plan, and his retirement benefits will accrue to his benefit through a separate fund administered by the board of trustees. Participants electing to participate in the DROP plan whose contributions to the Trust Fund are either discontinued or reduced, shall receive a return of any contributions made to the Trust Fund on their behalf after the commencement of their participation in the DROP or, at the member's option, said contributions shall be deposited into the separate fund administered by the board of trustees. The DROP to be created and administered by the board of trustees must be created and administered in such a way as to not increase the city's contributions to the Pension Plan.

(e)

Compliance with Internal Revenue Code Sections 414(k) and 414(i). To the extent required under the Internal Revenue Code, the DROP under the Pension Plan shall be treated as a defined contribution plan to the extent that the member's benefits under the retirement system are based on the member's DROP account. The amount of "annual additions" (as such term is defined in Section 415(c)(2) of the Internal Revenue Code and Treasury Regulations Section 1.415(c)-1(b)) which may be allocated under the DROP to a member's DROP account for a "limitation year" may not exceed the maximum permissible amount under Section 415(c)(1) of the Internal Revenue Code and Treasury Regulations Section 1.415(c)-(a)(1) (the "Annual Maximum Amount"). For purposes hereof, the term "limitation year" means the twelve-month period beginning October 1. In addition, for purposes of determining a member's Annual Maximum Amount, the member's compensation shall be determined in compliance with Treasury Regulations Section 1.415(c)-2.

(Ord. No. 90-33, Ch. II, § 6-3, 5-21-91; Ord. No. 99-29, § 9, 11-16-99; Ord. No. 2000-10, § 1, 8-15-00; Ord. No. 2013-17, § 2, 9-17-13; Ord. No. 2013-26, § 1, 11-19-13; Ord. No. 2015-03, § 2, 6-2-15)