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Amendment and Restatement of the Plan Document for the NTMWD Employee Retirement Plan; Resolution No. 24-38
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SUBJECT
recommendation
Adopt Resolution 24-38 authorizing the amendment and restatement of the plan document for the Retirement Plan for Employees of North Texas Municipal Water District
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PURPOSE
The amendment and restatement of the plan document for the Retirement Plan for Employees of NTMWD are necessary to incorporate required regulatory changes and updates related to plan administrative practices. These changes will become effective, January 1, 2025.
RECOMMENDATION
The Executive Director and NTMWD staff recommend that the Board of Directors adoption of Resolution 24-38 authorizing the amendment and restatement of the Retirement Plan for Employees of NTMWD.
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Committee: |
This item was on the August 7, 2024, Personnel Committee meeting agenda |
DRIVER(S) FOR THIS PROJECT
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Strategic Objective: |
2.1 Efficient Business Practices 4.4 Employer of Choice |
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☒ Regulatory Compliance |
☐ Asset Condition |
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☐ Capacity |
☐ Redundancy/Resiliency |
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☐ Relocation or External Requests |
☐ Operational Efficiency |
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☐ Safety |
☒ Administrative |
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☐ Policy |
☐ Other _____________ |
BACKGROUND
The Retirement Plan for Employees of North Texas Municipal Water District was established effective February 1, 1962. Prior to May 1, 1990, the plan was funded on a deferred annuity basis. On May 1, 1990, the method of the fund changed to a defined benefit fund basis. This amendment and restatement of the plan document, effective January 1, 2025, includes the statutory, regulatory and administrative provisions to:
• Incorporate the requirements of the “Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019 and SECURE Act 2.0 of 2022, which raised “required minimum destitution” from 72 to age 73.
• Revise the definition of “Earnings” to include up to 80 hours of regular earnings from any two-week pay period, regardless of the employee’s shift or rotation.
• Include lump-sum merit pay and lump-sum recognition awards for “employee of the year” in earnings for pension benefits.
• Require actuarial cost analysis for changes that will substantially change pension benefits.
• Establish an administrative process for applying for recognition of non-NTMWD government service credit by employees within one hundred and eighty (180) days of beginning employment with the District.
• Delegate administrative responsibilities to a retirement plans committee.
These changes are primarily driven by regulatory compliance and the need to improve plan operation.
FUNDING
N/A