STATE OF DELAWARE

COUNTY AND MUNICIPAL

POLICE / FIREFIGHTER

PENSION PLAN BOOKLET

http://www.delawarepensions.com

(SUMMARY PLAN DESCRIPTION)

AS IN EFFECT 6/30/99

FOREWORD

 The information in this booklet is very important to the security of you and your family! As a member of the Delaware County and Municipal Police/Firefighter Pension Plan (Plan), we strongly urge you to take the time to read it and to familiarize yourself with your rights, privileges, and obligations.

This booklet is meaningful to you whether you are a new employee, one active with years of service, or one who is nearing and planning retirement.

The Pension Plan Law is necessarily written in legal language; therefore, this booklet has been prepared in lay language to help you better understand its provisions. The following pages should be informative to you and, it is hoped, will answer most questions you may have about your Plan.

Our office wants to be of assistance to all active and retired members of the Plan. Therefore, if you have questions or need assistance in any of your retirement plan matters, we would be pleased to be of service to you either directly or through the business or personnel office of your employer.

We strongly recommend that you contact the Office of Pensions as soon as you are ready to begin planning for your retirement.

NOTE: This booklet is only applicable to employees covered under the Delaware County and Municipal Police/Firefighter Pension Plan. Nothing in this booklet is meant to extend or change in any way the provisions expressed in the Plan. If there is any conflict between a provision in this booklet and the Plan (Chapter 88, Title 11, Delaware Code), the Plan controls.

AS IN EFFECT DECEMBER 31, 1997

TABLE OF CONTENTS

ELIGIBILITY

You are a member of the Delaware County and Municipal Police/Firefighter Pension Plan if you are employed as a full-time police officer by a county or municipality in Delaware which has elected to join the Plan or if you are employed as a full-time uniformed firefighter with City of Wilmington after the City elected to join the Plan.

BREAK-IN SERVICE

If you leave County and Municipal Police/Firefighter service before you have acquired ten years of creditable service, your service credits will be canceled. They will be restored if:

If you cease to be an employee after you have acquired ten years of credited service, you are fully vested and will qualify for a pension at retirement age, unless you withdraw your accumulated contributions. Upon termination, a vested pension application or a withdrawal form must be filed by your agency personnel office.

If you receive a refund of your contributions and subsequently return to eligible employment, you should contact the Pension

Office for information relative to the options available to you regarding prior service credit.

MEMBERSHIP IDENTIFICATION

Your Social Security number is your Plan identification number. To assure proper identification and prompt service, always include your Social Security number in addition to your full name, mailing address, and phone number in all communications concerning your pension status.

CONTRIBUTIONS

As of January 1, 2000, you contribute 5% of your monthly "compensation" for members covered for FICA or you contribute 7% of your monthly "compensation" if you are not covered for FICA. "Compensation" shall mean all salary or wages, excluding overtime payments and special payments for extra duties, payable to a member for service. Effective January 1, 1993, the Federal and State income tax on your contributions is tax deferred pursuant to Section 414(h)(2) of the United States Internal Revenue Code.

VESTED PENSION

You are fully vested after ten years of credited service, and will qualify for a pension the first month after attaining age 62.

SERVICE PENSION

You are eligible for a service pension after you have terminated, beginning with the month when:

At the time of your application for pension, you may choose either a unified pension or an ordinary pension. A unified pension would combine your years of service as a Delaware County and Municipal Police/Firefighter with any years of equalized State service you have from the Delaware State Employees' Pension Plan, the Delaware County and Municipal Pension Plan, or the New State Police Pension Plan.

DISABILITY PENSION

Eligibility for Duty-Connected Disability

If you suffer a partial or total disability resulting from an individual and specific act, the type of which would normally occur only while employed as a police officer/firefighter, you shall be eligible for a duty-connected disability. You are eligible to receive a disability pension beginning with the month you become eligible.

Eligibility for Non-Duty-Connected Disability

If you suffer a partial or total disability and you are not eligible for a duty-connected disability pension, you shall be eligible for an ordinary disability pension if you have five years of credited service.

If you are determined to be totally disabled and recover, yet you are still partially disabled, your total disability pension will be reduced to a partial disability pension.

Your eligibility ceases at the end of the month in which you recover from your disability, unless you have reached normal retirement date or if you were on a duty-connected disability and were not offered employment by the county or municipality in a position for which you are suited by training and experience. Termination of a disability pension does not affect your right to qualify for a regular pension or another disability pension.

Proof

You are partially disabled if you have a physical or mental disability which prevents you from performing the duties of a police officer/firefighter for at least 12 months.

You are totally disabled if you have a physical or mental disability which prevents you from performing the duties of any occupation for which you are suited for by training or experience which is reasonably expected to last at least 12 months. If you apply for a disability pension, your examining physician must submit a report on a form supplied by the Office of Pensions. The Medical Committee of the Board of Pension Trustees then reviews your case and makes a recommendation to the Executive Secretary to the Board of Pension Trustees, who either grants or denies the application.

Post-Disability Earnings

Your disability pension will be reduced to the extent that earnings from any gainful occupation or business and worker's compensation benefits after you become disabled exceed the current base pay of the rank held at the time of the disability. Until you reach normal retirement age, you must report annually to the Board by April 30th the total of such earnings from the previous calendar year. A form will be supplied for this purpose by the Office of Pensions.

MANDATORY RETIREMENT

You must retire after accumulating 25 years of credited service.

SURVIVOR BENEFITS

If you die in active service, your eligible survivor will be paid a survivor's pension beginning the month following your death. The amount of the pension is one-half of your final average compensation.

If you die while receiving a service or disability pension, the pension payable to your eligible survivor or survivors, beginning the month following your death, will be equal to one-half of such pension.

If you die and you have a vested right to a pension, your eligible survivor will be due a survivor pension equal to one-half of the service pension you would have been entitled to receive. The survivor's pension will begin with the month you would have been eligible to receive such pension.

Priority

The following lists the priority of survivors unless you change the priority by filing a form with the Board of Pension Trustees:

If the primary survivor ceases to be eligible for a survivor's pension, that pension becomes payable to the next eligible survivor.

DEATH BENEFITS

Contributions

If you die leaving no eligible survivors, your beneficiary will be paid a lump sum equal to the excess, if any, of your accumulated contributions with interest less all pension payments made, including survivor's benefits. You may designate a beneficiary by completing a P-7 Actuarial form. This form should be updated to reflect any changes in your marital status or dependent children. If there is no designated beneficiary, the sum will be paid to your estate.

REFUND OF CONTRIBUTIONS

Upon application, your accumulated contributions with interest will be paid to you when you leave Delaware County and Municipal Police/Firefighter employment. Withdrawal of your contributions will terminate your membership in the Plan and will void any rights you have to future benefits in the Plan. This refund will not be made to you until at least 90 days following the receipt of your last check.

The State is required by federal law to withhold 20% of the taxable portion of your refund that is eligible for rollover distribution, unless you choose to have that portion of the refund subject to withholding made payable directly to your IRA or to another employer plan that accepts rollovers.

In addition, any refund from the Plan prior to you obtaining age 59 1/2 years will be subject by the Internal Revenue Service to a 10% penalty for early withdrawal.

WORK RESTRICTIONS

You cannot receive a pension from the Plan during any month you are an employee of a county or municipality who has joined a State administered pension plan.

GENERAL

Creditable service is used to determine both your eligibility for retirement benefits and the amount of these benefits.

Creditable service represents periods of:

EARNED SERVICE

You earn one month of creditable service for each month during a year in which you are an employee who works in a position, which is full-time.

No more than one year of service is creditable for all employment in one year.

EQUALIZED STATE SERVICE

If you have years of service as an employee in another Delaware-administered pension plan that provides for equalized service, you may convert that service to credited service in the Delaware County and Municipal Police/Firefighter Plan based on the factors as outlined in the Plan. You may not use service for which you are accruing or collecting benefits; also, it shall not include service for which you have received a refund of contributions unless such refund has been repaid with interest at a rate determined by the Board of Pension Trustees.

4. BENEFIT COMPUTATION

Your pension amount is primarily based on your years of credited service (to the nearest 1/12 of a year) and your Final Average Compensation. Your Final Average Compensation is 1/36 of the compensation paid to you during any period of 36 consecutive months during which your compensation was the highest.

AMOUNT OF ORDINARY SERVICE PENSION

Your monthly benefit is computed by multiplying 1/40 of your Final Average Compensation times your years of credited service (to the nearest 1/12 of a year), subject to the maximum limitation of 25 years of service.

AMOUNT OF UNIFIED SERVICE PENSION

The amount of the unified service pension shall be the sum of:

AMOUNT OF DUTY-CONNECTED DISABILITY PENSION

AMOUNT OF NON DUTY-CONNECTED DISABILITY PENSION

MAXIMUM BENEFITS

Members who are eligible accrue benefits under the Federal Social Security Act and shall be subject to maximum benefit limitations as outlined in the Plan.

TAX TREATMENT OF BENEFITS

To determine the proportionate part of the total amount received each year which is non-taxable, an exclusion ratio will be determined by using tables provided by the Internal Revenue Service. This ratio is determined by dividing your employee contributions which were subject to tax by the expected total amount of your pension benefits to be received over your estimated lifetime. The ratio will be calculated by the Pension Office when you begin to receive your pension benefit.

EXAMPLE #1 - ORDINARY SERVICE PENSION

Employee retiring with 25 years of service and a Final Average Compensation (F.A.C.) of $3,000 per month.

Employee will receive a pension benefit of $1,875 per month. Upon the death of the employee, his or her primary survivor will receive a pension benefit of $938 per month (1/2 of the pension the employee is eligible to receive at the time of his or her death).

EXAMPLE #2 - UNIFIED SERVICE PENSION (WITH SERVICE FROM STATE EMPLOYEES' PENSION PLAN)

Employee retiring with 25 years of equalized state service (15 years of State Police service and 12 years of service in the State Employees' Pension Plan), with a Final Average Compensation (F.A.C.) of $3,000 per month in the County and Municipal Police/Firefighter Pension Plan and a F.A.C. of $2,000 in the State Employees' Pension Plan.

COUNTY AND MUNICIPAL POLICE/FIREFIGHTER PENSION PLAN

Employee will receive a pension benefit of $1,125 per month from the County and Municipal Police/Firefighter Pension Plan.

STATE EMPLOYEES' PENSION PLAN

Employee will receive from the State Employees' Pension Plan a pension benefit of $400 per month.

Employee will receive a total pension benefit of $1,525 ($400 + $1,125) per month.

(WITH SERVICE FROM THE NEW STATE POLICE PENSION PLAN)

Employee retiring at age 60 with 25 years of equalized service (5 years of State Police service and 20 years of service in the County & Municipal Police/Firefighter Pension Plan), with a Final Average Compensation (F.A.C.) of $2,000 per month in the New State Police Pension Plan and a F.A.C. of $3,000 in the County & Municipal Police Pension Plan.

COUNTY AND MUNICIPAL POLICE/FIREFIGHTER PENSION PLAN

Employee will receive a pension benefit of $1,500 per month from the County and Municipal Police/Firefighter Pension Plan.

NEW STATE POLICE PENSION PLAN

Employee will receive, from the New State Police Pension Plan, a pension benefit of $250 per month.

Employee will receive a total pension benefit of $1,750 ($1,500 + $250).

EXAMPLE #4 - UNIFIED SERVICE PENSION (WITH SERVICE FROM THE COUNTY AND MUNICIPAL PENSION PLAN)

Employee retiring at age 60 with 25 years of equalized state service (15 years of County and Municipal Police/Firefighter Service and 12 years of service in the County & Municipal Pension Plan), with a Final Average Compensation (F.A.C.) of $3,000 per month in the County and Municipal Police/Firefighter Pension Plan and a F.A.C. of $2,000 in the County and Municipal Pension Plan.

COUNTY AND MUNICIPAL POLICE/FIREFIGHTER PENSION PLAN

Employee will receive a pension benefit of $1,125 per month from the County and Municipal Police/Firefighter Pension Plan.

COUNTY AND MUNICIPAL PENSION PLAN

Employee will receive from the County and Municipal Pension Plan a pension benefit of $400 per month until age 62 at which time the benefit will be reduced to $325.

Employee will receive a total pension benefit of $1,525 ($1,125 + $400) until age 62 at which time the benefit will be reduced to $1,450 ($1,125 + $325).

EXAMPLE #5 - VESTED SERVICE PENSION

Employee leaves County and Municipal Police/Firefighter employment with 10 years of service and a Final Average Compensation (F.A.C.) of $3,000 per month.

Employee will receive a pension benefit when he or she reaches age 62 of $750 per month.

For employees eligible under the Federal Social Security Act, there is a maximum pension beginning at age 62 or, if later, at retirement. The benefit shall in no case exceed 75 percent of final average compensation minus the age 62 Social Security benefit. The result to be multiplied by the ratio of years of service divided by 25.

EXAMPLE #1

Employee leaves employment with 20 years of service and Final Average Compensation (F.A.C.) of $3,000 per month.

6. APPLYING FOR A PENSION

SERVICE, DISABILITY, OR VESTED APPLICATION

At least three months before you plan to retire, you should contact your personnel representative to begin the application process. The following documents, as applicable, must accompany the application for benefits.

SURVIVOR'S APPLICATION

All of the above documents must be submitted (as applicable) plus the following:

Nothing in this booklet is meant to extend or change in any way the provisions expressed in the Plan. If there is any conflict between a provision in this booklet and the Plan (Chapter 88, Title 11, Delaware Code), the Plan controls.