Defined contribution fund.

San José Municipal Code § 3.49.070

in effect

3.49.070 - Defined contribution fund. A. The City shall establish a defined contribution fund to which all contributions to the plan shall be credited, and to which all direct rollover amounts accepted by the plan shall be credited as received. Separate accounts will be established for each employee and elected official participating, which will show all amounts of contributions, direct rollover amounts, investments made, shares acquired and earnings and gains on investments. Each account will be valued at least semiannually. B. On executing the participation agreement, the participant shall designate his or her investment objective prospectively only. The City may select for investment of accounts the types of investments set forth in Sections 53601 and 53602 of the Government Code of the State of California and in corporate stocks, bonds, and securities, mutual funds, savings and loan accounts, credit union accounts, life insurance policies, variable and fixed annuities, mortgages, deeds of trust, or other security interests in real or personal property. Nothing in this Section shall be construed to permit any type of investment prohibited by the Constitution of the State of California. C. From time to time, the City Manager (or his or her designee) shall determine the available investment funds for participants (or beneficiaries upon the death of the participant). The participants may direct the investment of their accounts among the investment funds so selected. Unless otherwise directed by the participant (or beneficiary), in accordance with procedures established by the City Manager (or his or her designee), a participant's (or beneficiary's) employer contribution account, and rollover contribution account, shall be invested in the same manner as the participant's (or beneficiary's) 414(h) pick-up contribution account. The City Manager (or his or her designee) shall follow the participants' (or beneficiaries') directions with respect to the investment of the accounts, except that the City Manager (or his or her designee) shall direct the investment of a participant's (or beneficiary's) account to a default investment when there is no valid investment direction on file. D. In the event that a participant does not have a valid investment direction on file for any portion of the amount in that participant's account, that portion of the account shall be invested in any default option or options as determined by the City Manager (or his or her designee). In such event, the participant shall be deemed to have directed that option (or options) for investment of such portion of their account. The City Manager (or his or her designee) intends to establish one or more default options based upon various factors, including but not limited to, market risk, stability and rate of return. If the City Manager (or his or her designee) has appropriately exercised their fiduciary duty in selecting a default option(s), they have no liability for any loss sustained by a participant or beneficiary whose account in whole or in part is invested in the default option(s). E. All amounts of compensation deferred pursuant to the plan, all property and rights acquired or purchased with such amounts and all income attributable to such amounts, property or rights held as part of the plan, shall be transferred to the City to be held, managed, invested and distributed as part of the fund in accordance with the provisions of the plan. All contributions to the plan must be transferred by the City to the fund. All benefits under the plan shall be distributed solely from the fund pursuant to the plan. (Ords. 29184, 30625.)

Source: City of San José, Municipal Code (Municode Library, library.municode.com)URL: https://library.municode.com/ca/san_jose/codes/code_of_ordinances?nodeId=TIT3PE_IIREPL_CH3.49UNMADECO401PL_3.49.070DECOFUFetched: 11/1/2026