§ 40-51. - Definitions.
The following words, terms and phrases, when used in this division, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:
(1) Actuarial (or Actuarially) Equivalent: Equality in value of the aggregate amounts expected to be received under different manners of payment based on interest rate and mortality assumptions as defined below unless otherwise specifically provided by the System:
a. Interest rate assumption. Effective for benefits commencing on or after October 1, 2020, the interest rate used for purposes of computing single lump sum payments shall be six and three-quarters percent per annum. Said interest rate shall be used until changed by amendment. Effective for benefits commencing on or after October 1, 2020, the interest rate used for computing alternative periodic forms of benefits shall be six and three-quarters percent per annum. Said interest rate shall be used until changed by amendment.
b. Mortality assumption. Effective for benefits commencing on or after October 1, 2020, shall be a fixed blend of 60 percent of the RP-2014 Blue Collar Healthy Annuitant Male rates scaled by 95 percent and 40 percent of the RP-2014 Blue Collar Healthy Annuitant Female rates scaled by 90 percent, with future mortality improvements projected to 2025 using MP-2016. Said mortality assumption shall be used until changed by amendment.
c. Applicable Mortality Table. Notwithstanding any other provisions of this division to the contrary, for distributions with annuity starting dates prior to December 31, 2002, the applicable mortality table used for purposes of adjusting any benefit or limitation under Code Sections 415(b)(2)(B), (C), or (D) shall be the applicable mortality table cited in Revenue Ruling 98-1. For distributions with annuity starting dates on or after December 31, 2002 through December 31, 2007, the applicable mortality table used for purposes of adjusting the related benefit or limitation under Code Sections 415(b)(2)(B), (C), or (D) shall be the table described in Revenue Ruling 2001-62. The applicable mortality table used for purposes of adjusting the related benefit or limitation under Code Sections 415(b)(2)(B), (C), or (D) for plan years beginning after December 31, 2007, means the applicable Code Section 417(e)(3) mortality table for the plan year (as published for such plan year by the Internal Revenue Service in accordance with Code Section 417(e)(3)(B)).
(2) Average Final Compensation: The average earned Compensation of the Participant, effective February 6, 2001, in the highest consecutive 36 months of his/her last 60 consecutive months of service as an Employee, or if he/she has had less than 36 months of service then the average earned Compensation of his/her entire period of service. The considered period shall be determined by disregarding any break in service such as any period of absence without Compensation, including a furlough.
(3) Board of Trustees: The managing body of the System, which shall be known as the Board of Trustees of the Oklahoma City Employee Retirement System.
(4) City: Either The City of Oklahoma City, a Participating Public Trust, or System as the text of the individual sections requires; provided, however, in no event is it to be given a meaning which would accord Employees of a Participating Public Trust or the System greater or less benefits than those granted to Employees of the City.
(5) Code: The Internal Revenue Code of 1986, as amended from time to time.
(6) Compensation: The amount of compensation paid to an Employee in accordance with the Board's Policy and Procedure No. 17.1, including any amounts picked up by the City pursuant to Section 414(h) of the Code, or any amounts the Participant has elected to defer under Section 457 of the Code and excluding any amounts the Participant has elected to defer under Section 125 of the Code. Effective on and after January 1, 2001, Compensation shall include elective deferrals that are not includable in the gross income of the employee by reason of Code Section 132(f)(4).
In addition to other applicable limitations, and notwithstanding any other provision to the contrary, for years beginning on or after January 1, 2002, the annual compensation of each "Noneligible Participant" shall not exceed the Economic Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA") annual compensation limit. The EGTRRA annual compensation limit is $200,000.00, as adjusted by the Commissioner of the Internal Revenue Service for increases in the cost of living in accordance with Code Section 401(a)(17)(B). The cost-of-living adjustment in effect for a calendar year applies to any period, not exceeding 12 months, over which compensation is determined (determination period) beginning in such calendar year. If a determination period consists of fewer than 12 months, the EGTRRA annual compensation limit will be multiplied by a fraction, the numerator of which is the number of months in the determination period, and the denominator of which is 12. A "noneligible participant" is any participant who first became a participant during a year beginning on or after January 1, 1996.
Effective January 1, 2008, Compensation shall also include Compensation paid by the later of two and one-half months after an employee's severance from employment with the City maintaining the System or the end of the plan year that includes the date of the employee's severance from employment with the City maintaining the System, if the payment is regular compensation for services that, absent a severance from employment, the payments would have been paid to the employee while the employee continued in employment with the City.
Any payments not described above shall not be considered Compensation if paid after severance from employment, even if they are paid by the later of two and one-half months after the date of severance from employment or the end of the plan year that includes the date of severance from employment, except payments to an individual who does not currently perform services for the City by reason of qualified military service (within the meaning of Code Section 414(u)(5)) to the extent these payments do not exceed the amounts the individual would have received if the individual had continued to perform services for the City rather than entering qualified military service.
Back pay, within the meaning of Section 1.415(c)—2(g)(8) of the Income Tax Regulations, shall be treated as Compensation for the plan year to which the back pay relates to the extent the back pay represents wages and compensation that would otherwise be included in this definition.
Effective January 1, 2009, Compensation shall also include differential wage payments under Code Section 414(u)(12).
(7) Consecutive Year(s) of Vesting Service: Period or periods of employment with the City as described in Section 40-51(34) which is uninterrupted by a Termination of Employment.
(8) Credited Interest: Interest credited to Participant contributions pursuant to Section 40-123.
(9) Credited Service: Period or periods of employment as an Employee with the City as described in Section 40-75.
(10) Deferred Vested Participant: A Participant who terminates service with the City as provided for in Section 40-70, but before his/her Normal Retirement Age and who has elected to leave his/her Employee Contribution Account on deposit with the System, or has failed to elect within 90 days of his/her Termination of Employment to leave his/her Employee Contributions on deposit with the System or receive a refund of his/her Employee Contribution Account.
(11) Disability: An Employee's physical inability to perform his/her assigned job or a comparable job with the City considering his/her educational qualifications and physical limitations or physical ability to perform such a job.
(12) Elected Official: Any officer duly elected by the citizens of the City.
(13) Eligible Spouse: The husband or wife of a Participant to whom he/she is married on the date the Participant's Retirement Benefits under the System commence.
(14) Employee: A permanent and full-time classified or unclassified person employed by the City or the Oklahoma City Employee Retirement System. Included as Employees are "leased employees" as defined in this Section 40-51(14). The term "leased employee" means any person:
a. who is not an Employee of the City, and
b. who pursuant to an agreement between the City and any other person (a "leasing organization") has performed services for the City on a substantially full-time basis for a period of at least one year, as such services are performed under primary direction or control by the City. Notwithstanding the foregoing, if "leased employees" constitute less than 20 percent of the City's nonhighly compensated workforce within the meaning of Code Section 414(n)(5), a person who is covered by a money purchase pension plan maintained by the leasing organization which provides a non-integrated employer contribution rate of at least ten percent of compensation, immediate participation, and full vesting shall not be considered a "leased employee."
(15) Employee Contributions: The contributions made by the Participant pursuant to Section 40-121.
(16) Employee Contribution Account: The total accumulated Employee Contributions and Credited Interest, if any, as provided in this division, which shall not be required to be held in a separate account.
(17) Joint Annuitant: The surviving spouse of a Participant who has selected an option under Section 40-71 or Section 40-112.
(18) Leave of Absence: A period of absence from employment without pay, not to exceed one year, authorized and approved by the City Manager or the Mayor and Council and acknowledged to the Board of Trustees.
(19) Military Service: Leave taken during employment with the City to serve in the Armed Forces of the United States, which service is immediately preceded by a period of employment with the City and is followed by return to employment as specified in Subsection 40-75(c).
(20) Money Purchase Plan and Trust - Closed Plan: The defined contribution pension plan under § 401(a) of the Code, approved by the Council August 25, 1987. This plan is available to eligible Employees, as determined by Section 40-61, participating in the plan on or before August 31, 2001.
(21) Money Purchase Plan and Trust - Open Plan: The defined contribution pension plan under § 401(a) of the Code, approved by the Council July 31, 2001.
(22) Normal Retirement Age: The 60th birthday of those Employees serving prior to March 1, 1967, and shall mean the 65th birthday of those Employees beginning their service on or after that date. However, for each Employee hired or rehired by the City on or after January 1, 2008, Normal Retirement Age shall mean the later of the 65th birthday of the Employee or the attainment of five years of Vesting Service.
(23) Normal Retirement Date:
(a) Effective March 1, 2001, through December 31, 2007, the first day of a Participant's Retirement after attainment of:
(1) age 65 with five years of service, or
(2) 25 years of service regardless of the Participant's age.
(b) Effective January 1, 2008, the first day of a Participant's Retirement after attainment of:
(1) age 65 with five years of service (for each Employee hired by the City on or after March 1, 1967 through December 31, 2007), or
(2) his or her Normal Retirement Age (for each Employee hired by the City on or after January 1, 2008), or
(3) 25 years of Vesting Service (regardless of the Participant's age).
(24) Participant: An Employee who has met all the requirements for eligibility to participate in the System, has become included in the System, as provided in Division 1 herein, and who continues to have rights or contingent rights to benefits payable under the System.
(25) Participating Public Trust: Any public trust in which the City holds the beneficial interest and which by resolution of its Board of Trustees has requested that its Employees be permitted to join the System, and whose request has been approved by the City Council.
(26) Price Index: The Consumer Price Index (all items—United States City Average) published monthly by the Bureau of Labor Statistics, U.S. Department of Labor or its successor in function.
(27) Prior Service Credit: The length of prior service to which an Employee is entitled subject to the limitations contained in Section 40-51(18) and Section 40-75 upon re-depositing the required sum as governed by Section 40-75(b). Length of prior service is determined by the number of years served and not the time period in which it is served.
(28) Retirement: Termination of Employment for reason other than death after a Participant has fulfilled all requirements for a normal or early Retirement Benefits. Retirement shall be considered as commencing on the day immediately following a Participant's last day of employment (or authorized Leave of Absence, if later).
(29) Retirement Benefit(s): A monthly income with benefits accruing from the first day of Retirement and ending on the last day of the month in which death occurs. The monthly income shall commence payment on the last day of the month following the month when the Participant submits his or her completed application to retire. The Participant shall receive a retroactive payment (without interest), if due, with his or her first monthly check. Such retroactive payment shall include a payment for the pro rata portion of the first month of the Participant's Retirement.
(30) Retired Participant: A former Employee who is receiving benefits due to Retirement or Disability.
(31) Retirement Program: The trusts and System defined in Paragraphs (20), (21) and (32) of this section.
(32) System: The Oklahoma City Employee Retirement System, codified in Chapter 40, Article III, Division 1, §§ 40-46 through 40-130 of the Oklahoma City Municipal Code, 2020, as amended. A Central Oklahoma Transportation & Parking Authority (COTPA) employee who is eligible, pursuant to Chapter 40, Article III, Division 2, Section 40-132, to participate in the Money Purchase Plan and Trust - Open Plan is not an Employee, as such term is defined under Chapter 40, Article III, Division 1, Part A, Section 40-51(14), and is not entitled to receive the same benefits as a Participant, as such term is defined under Chapter 40, Article III, Division 1, Part A, Section 40-51(24), of the System.
(33) Termination of Employment: The Retirement, resignation or other voluntary or involuntary cessation of an Employee's employment with the City.
(34) Vesting Service: Period or periods of employment with the City as an Employee, as described in Section 40-75, but including a leave of absence pursuant to the Family and Medical Leave Act of 1993.
(Ord. No. 21916, § 2, 2-12-02; Ord. No. 22103, § 1, 12-17-02; Ord. No. 23056, § 1, 8-1-06; Ord. No. 23079, § 1, 8-15-06; Ord. No. 23463, § 1, 10-9-07; Ord. No. 23758, § 1, 12-9-08; Ord. No. 24002, § 1, 1-5-10; Ord. No. 24056, § 1, 4-27-10; Ord. No. 24145, § 1, 10-12-10; Ord. No. 24926, § 1, 7-29-14; Ord. No. 26525, § 1, 9-1-20, eff. 10-1-20; Ord. No. 27732, § 1, 11-19-24)
