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Meeting Date:
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7/27/2017 - 6:30 PM
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Category:
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Regular Items of Business
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Type:
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Action
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Subject:
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4. Action on a Resolution to Adopt an Amendment to the Milwaukee Board of School Directors Supplemental Early Retirement Plan for Teachers
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Strategic Plan Compatibility Statement:
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Goal 3 Effective and Efficient Operations
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Attachments
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File Attachment:
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Background:
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On January 9, 2017, the Internal Revenue Service (IRS) issued an updated Determination Letter for the Milwaukee Board of School Directors Supplemental Early Retirement Plan for Teachers (the Teachers Plan). The Office of the City Attorney coordinated this filing with assistance from Ice Miller LLP, a national firm with expertise in public pension law, in concert with the Administration. As a condition to the issuance of the Determination Letter, the IRS requires that the Plan adopt an amendment to remain current with Internal Revenue Code requirements for qualified plans. The updated provisions will specifically address Internal Revenue Code Section 401(a)(9) for Required Minimum Distributions.
A favorable determination letter confirms the Plan’s continuing status as a qualified plan entitled to favorable tax treatment under section 401(a) of the Internal Revenue Code.
The Administration seeks adoption of a resolution authorizing amendments to the Teachers Plan to include updated plan language consistent with requirements for a qualified plan under section 401(a) of the Internal Revenue Code.
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Fiscal Impact Statement:
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This item does not authorize expenditures.
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Implementation and Assessment Plan
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Upon approval by the Board, The Administration will amend the Teachers Plan document to include the updated language as authorized.
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Recommendation:
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The Administration recommends that the Board adopt the following resolution approving amendments to the Milwaukee Board of School Directors Supplemental Early Retirement Plan for Teachers effective February 26, 2015:
WHEREAS, the Internal Revenue Service has provided guidance as to amendments to the Milwaukee Board of School Directors Supplemental Early Retirement Plan for Teachers (the Teachers Plan) that will facilitate a favorable conclusion of the determination letter request process; now, therefore, be it
RESOLVED, By the Milwaukee Board of School Directors’ that the Teachers Plan be amended effective February 26, 2015:
Section 6.4(a), regarding compliance with Code Section 401(a)(9) for Required Minimum Distributions, shall be amended to be and read as follows:
“(a) Distribution of a Participant's benefit must begin by the required beginning date, which is the later of the April 1 following the calendar year in which the Participant attains age 70-1/2 or April 1 of the year following the calendar year in which the Participant retires.”
FURTHER RESOLVED, That the Superintendent and/or designees are hereby authorized and directed to implement these amendments to the Teachers Plan document and to incorporate them in a restated Plan document.
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Approvals:
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Recommended By:
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Signed By:
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Himanshu B Parikh - Chief
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Signed By:
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Seemi Daniel - Financial Planning & Budget Coordinator III
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Signed By:
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Dr. Darienne Driver - Superintendent
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