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Pension Plan

 
Maximum Benefits

General Rule

  1. Notwithstanding any other provision of this Plan (except to the extent the provisions of this Section 12.01.a. are superceded by the provisions in Article 16), annual Accrued Benefit related to employment with a Contributing Employer payable with respect to any Participant shall not exceed:
    1. $90,000 or, if lower,
    2. 100 percent of the Participant’s average Compensation in the period of three consecutive calendar years in which his Compensation was the highest. For this purpose Compensation shall be considered zero in the absence of reliable information confirming a Participant’s Compensation.
    Information on Participants’ Compensation furnished to the Board of Trustees by a contributing Employer shall be deemed reliable. In addition, the Board of Trustees may rely on information on Compensation furnished by a Participant or Beneficiary if, in the Board of Trustees’ judgment, the information is reliable.
  2. This limit shall not apply to any benefit payable in a year that does not exceed $1,000 a year for each year in which the Participant earns a Year of Credited Service, up to a maximum of $10,000. If the Participant does not earn a Year of Credited Service, but earns a fraction, not exceeding 1.0, of a Year of Credited Service, the $1,000 amount for the year is reduced by multiplication by that fraction. This subsection b. shall not apply if the Participant has also been covered by an individual account plan to which the Employer contributed on his behalf, and if such plan was maintained as a result of collective bargaining involving the same employee representatives as this Plan.
    1. The $90,000 limit in subsection a.(1) is increased annually in accordance with IRS rulings and regulations under Internal Revenue Code §415(d).
    2. For the purposes of subsection a.(2), “Compensation” is amounts defined in Internal Revenue Code §3401(a) for purposes of federal income tax withholding at the source determined without regard to limitations relating to the nature or location of employment, plus all other payments for which the employer is required to furnish the employee a written statement under Internal Revenue Code §6041(d), §6041(a)(3), or §6052.

    3. Notwithstanding the foregoing, for Plan Years beginning after December 31, 1997, an Employee’s compensation shall include any elective deferral (as defined under Code §402(g)(3)), and any amount which is contributed or deferred by the Employer at the election of the Employee and which, by reason of Code §§125, 132(f)(3) or 457, is not includable in the gross income of the Employee.
    4. For purposes of subsection a.(2), a Participant’s average Compensation is deemed to be increased in each calendar year following his termination of service with the Employer for increases in the cost of living, based on the procedures used to adjust benefit amounts under §215(i)(2)(A) of the Social Security Act.
    5. Benefit payments that are limited by this Article shall be increased annually to the level permitted by the limitations of this Article as adjusted for later years in accordance with this subsection, but in no event to a level higher than the benefits attributable to Benefit Units earned by the Participant.
  3. For the purpose of administering the Plan, the maximum benefit limitation under this Article shall be tested on the basis of the Participant’s benefit being attributable to service with a single Contributing Employer. For this purpose, the benefit under this Plan considered as payable with respect to a Participant and an Employer shall equal the excess of the benefit over the benefit computed as if the Participant had no covered service with the Employer.

Adjustment of Dollar Limit for Early or Late Retirement

  1. If a Participant’s benefit payments begin before the Participant’s Social Security retirement age, but on or after age 62, the dollar limit under Section 12.01(a) is reduced as follows:
    1. If the Participant’s Social Security retirement age is 65, the dollar limit is reduced by 5/9 of 1% for each month by which benefits begin before the month in which the Participant reaches 65.
    2. If the Participant’s Social Security retirement age is later than 65, the dollar limit is reduced by 5/9 of 1% for each of the first 36 months and 5/12 of 1% for each additional month (up to 24) by which benefits begin before the month of the Participant’s Social Security retirement age.
  2. If a Participant’s benefit payments begin prior to age 62, the dollar limit is reduced to the Actuarial Equivalent (as defined in Section 12.02.f.) or the benefit payable at age 62.
  3. If a Participant’s benefit payments begin after Social Security retirement age, the limit is increased to the Actuarial Equivalent (as defined in Section 12.02.f.) of the dollar limit otherwise payable at the Social Security retirement age.
  4. For purposes of this Section, Social Security retirement age is:
    1. Age 65, for a Participant born before January 1, 1938;
    2. Age 66, for a Participant born after December 31, 1937 and before January 1, 1955, and
    3. Age 67, for a Participant born after December 31, 1954.
  5. In the case of a Participant employed by a tax-exempt Employer:
    1. If the Participant’s benefit payments begin before age 65, but on or after age 62, the dollar limit is not reduced.
    2. If the Participant’s benefit payments begin before age 62, but on or after age 55, the dollar limit is reduced to the Actuarial Equivalent (as defined in Section 12.02.f.) of the benefit payable at age 62, but not below $75,000.
    3. If the Participant’s benefit payments begin before age 55, the dollar limit is reduced to the Actuarial Equivalent (as defined in Section 12.02.f.) of the benefit payable at age 55.
    4. If the Participant’s benefit payments begin after age 65, the dollar limit is increased to the Actuarial Equivalent (as defined in Section 12.02.f.) of the benefit payable at age 65.
  6. For purposes of Subsections 12.02.b., 12.02.e.(2), and 12.02.e.(3), Actuarial Equivalent means the lesser of (1) the equivalent amount computed using the plan rate and plan mortality table (plan tabular factor shown in Section 3.05) used for actuarial equivalence for early retirement benefits under the plan and (2) the amount computed using 5 percent interest and the Applicable Mortality Table.

    For purposes of Subsections 12.02.c. and 12.02.e.(4), Actuarial Equivalent means the lesser of (1) the equivalent amount computed using the plan rate and plan mortality table (plan tabular factor shown in Section 3.05) used for actuarial equivalence for late retirement benefits under the plan and (2) the amount computed using 5 percent interest and the Applicable Mortality Table described in Section 1.01.a.

Adjustment for Optional Payment Form
If the Participant’s accrued benefit is paid in any form other than a single-life annuity, a Husband-and-Wife Pension, 100% Survivor Option or 75% Survivor Option, the limitations in Section 12.01.a. are applied to the accrued benefit before it is converted to the optional payment form, so that the amount payable under the payment form selected will be the Actuarial Equivalent of the accrued benefit (which is defined as a single-life annuity) as limited by Section 12.01.a.

For this purpose, if the benefit is subject to IRC Section 417(e)(3), Actuarial Equivalent is the greater of (1) the benefit computed using the interest rate and mortality table, or tabular factor, specified in the plan for actuarial equivalence for the particular form of benefit payable, and (2) the benefit computed using the “Applicable Interest Rate” and the “Applicable Mortality Table” described in Section 1.01.a. If the benefit is not subject to IRC Section 417(e)(3), Actuarial Equivalent is the greater of (1) the benefit computed using the interest rate and mortality table, or tabular factor, specified in the plan for actuarial equivalence for the particular form of benefit payable, and (2) the benefit computed using a 5% interest rate and the “Applicable Mortality Table” described in Section 1.01.a.

Plan Aggregation

  1. In applying the limits of this Article, the benefit of and contributions to all other retirement plans sponsored by the Employer or any Affiliate shall be taken into consideration, except for multiemployer plans.
  2. Except as noted in subsection a., all defined benefit plans sponsored by the Employer or any Affiliate are treated as a single plan. Benefits payable under any other such plan with respect to a Participant shall be reduced to the extent possible before any reduction will be made in his benefits payable under this Plan, if necessary to observe these limits.
  3. For Limitation Years beginning before 2000 and except as noted in subsection a., if a Participant is covered under one or more defined contribution plans sponsored by the Employer or any Affiliate, his combined benefits and annual additions under all such defined benefit and defined contribution plans shall not exceed the applicable combined plan limits under Code §415(e) and the rules and regulations there under. If necessary to observe these limits, benefits under any other defined benefit plans will be reduced before benefits under this Plan, but benefits under this Plan will be reduced to the extent necessary if benefits under the other plans cannot be reduced.

Phase-In Over Years of Service

  1. The limit of Section 12.01.a.(2) shall be phased in, with respect to each Participant, at the rate of 10% for each Plan Credit Year in which the Participant earns a Year of Credited Service with the Employer or Affiliate, up to 100%. If the Participant does not earn a Year of Credited Service, but earns a fraction, not exceeding 1.0, of Year of Credited Service, the 10% rate for the year is reduced by multiplication by that fraction.
  2. In applying this rule to benefits under other plans with which benefits under this Plan are aggregated under Section 12.04.a., the phase-in for those other plans’ benefits shall be based on years of service for vesting as defined in those other plans.

Phase-In Over Years of Participation
If a Participant has fewer than ten years of participation in this Plan, the $140,000 limitation in Section 12.01.a.(1) shall be multiplied by a fraction, the numerator of which is the participant’s total years of participation in this Plan and the denominator of which is ten. The limitation thus obtained shall not be less than 10% of the $140,000 limitation.

Limitation Year
The annual limits of this Article shall be applied on a calendar year basis.

Protection of Prior Benefits

  1. For any year before 1983, the limitations prescribed by Section 415 of the Code as in effect before enactment of the Tax Equity and Fiscal Responsibility Act of 1982 shall apply, and no benefit earned under this Plan shall be reduced on account of the provisions of this Article if it would have satisfied those limitations under the prior law.
  2. For any year before 1992, the limitations prescribed by Section 415 of the Code as in effect before enactment of the Tax Reform Act of 1986 shall apply, and no benefit earned under this Plan as of the close of the last Limitation Year beginning before January 1, 1987 shall be reduced on account of the provisions of this Article if it would have satisfied those limitations under the prior law.

Interpretation or Definition of Other Terms
The term “Affiliate”, and all terms used in this Article not otherwise expressly defined in the Plan, shall be defined, interpreted and applied as prescribed in Internal Revenue Code §415 and the regulations and rulings issued thereunder.

References to specific section(s) of the Plan can be found in the Official Plan Document under Plan Documents on this website.

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