HomeMy WebLinkAbout24 Domestic Relations Order Policy TAB 24
DOMESTIC RELATIONS
ORDER POLICY
February 20 , 2007
DOMESTIC RELATIONS ORDER POLICY
The Board will honor Michigan Domestic Relations Orders (DRO) that assign some or all of the
periodic monthly pension benefit payments of a retiree (participant) who is in pay status to the
participant's divorced spouse, provided that all the following conditions are met:
l. the assignment is only for part or all of the j oint lifetime of the participant and
farmer spouse, i.e., while they are both living,
2. the DRO is properly issued by a court of competent jurisdiction as part of a
divorce between the participant and a spouse (alternative payee) and is included in a judgment of
divorce or an order authorized by the divorce,
3. the DRO does not require the plan to do or incur any of the following:
a, make any payment or take any action which is inconsistent with any
federal law, rule,regulation, or applicable judicial decision;
b. provide any type or form of benefit, or any option,which is not otherwise
provided for under the provision of the Plan;
C. provide increased benefits;
d, alter or amend the established survivor benefits of either Party, as selected
and determined under the Plan by the Participant at the time of retirement;
e, incur any greater cost or liability to the Retirement System or Plan than
existed before the entry of the DRO; and/or,
f. provide benefits to the Alternate Payee which are required to be paid to
another Alternate Payee under another order previously determined to be a
DRO, a Qualified Domestic Relations Order, or an Eligible Domestic
Relations Order under 1991 PA 46, as amended, and
4. the DRO is submitted and complies with the following acceptance procedure:
a. it is submitted to the Retirement Analyst in writing. Preferably, the initial
submission will be made before the DRO is entered by the Court;
b. it is reviewed and approved as to form by the City Attorney. In the review,
the City Attorney must determine that the DRO is issued in compliance
with Michigan law, clearly and understandably expresses the intended
divisions of the periodic►ionti'rly pension b4nerllt payments between the
participant and alternative payee, '►nd meet~ the other rc:cluircnrents of this
policy. The City Attorney will 1101-ily the Retirement Analyst wilell the
DRO is approved as to form;
C. before the DRO assignment will be made effective, the Retirement Analyst
must receive the DRO that has been entered by the court, together with
sufficient evidence of the entry.
The Board has developed a model DRO for use with the Police and Fire Retirement System. The
model DRO is attached. Submitted orders which follow a model DRO exactly will likely be
approved quickly and without required modifications. The hoard realizes that the model DRO
does not cover every possible type of valid provision. However, orders which depart from the
model DRO will necessitate detailed review by the City Attorney =1 possible delay in the
approval process.
Adopted and ratified this loon day of 2007, by the following vote:
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STATE OF MICHIGAN
IN THE CIRCUIT COURT FOR THE COUNTY OF
Plaintiff, File No.
v HON.
Defendant.
(Attorney Name) (P#)
Attorney for Plaintiff
(address)
(telephone#)
a
(Attorney Name) (P#) i
Attorney for Defendant
(address)
(telephone#)
DOMESTIC RELATIONS ORDER
FOR THE CITY OF LANSING
POLICE AND FIRE RETIREMENT SYSTEM PLAN
At a session of said Court,
held in the Circuit Court for the
County of , State of Michigan
this day of _, 2006.
PRESENT:HONORABLE Circuit Judge
This Order is intended by the Plaintiff, Defendant, and the Court to serve as a
Michigan.Domestic Relations Order (DRO), by which I)efendant/Plaintiff
assigns a portion of his/her retirement benefit under the.Retirement System specified below to
Plaintiff/Dgfendam , It is furthcr intended by the Plaintiff,Defendant, and the
Court:that this DRO comply with Michigan law, including MCL 552,18, MCL 552.101, and
MCL 38,1684, and be in accordance with City of.Lansing retirement plan identified in Section 1
below. Jurisdiction for the entry of this DRO is contained and/or reserved in the Judgment of
Divorce entered on the day of ,20 , and it is intended
that this DRO be incorporated into and be a part of the Judgment of Divorce.
NOW,THEREFORE, IT IS ORDERED AND ADJUDGED as follows.:
RETIREMENT PLAN
5. The name of the Plan subject to this DRO is:
CITY OF LANSING POLICE AND FIRE RETIREMENT SYSTEM
6. This DRO shall be mailed to:
CITY OF LANSING POLICE AND FIRE RETIREMENT SYSTEM
ATTN: RETIREMENT ANALYST
124 West Michigan Avenue
8"'Floor, City Hall
Lansing, MI 48.933
PARTICIPANT
7. The Participant is the Plaintiff/Defendant,
Social Security No.: XXX-XX- ; date of birth: ; retirement
effective date: ; Option Chosen: Straight Life Option with %
Surviving Spouse Benefit;whose last known address is:
(NAME)
(address)
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ALTERNATE PAY]Ell
g, The Alternate Payee is the Defendant/Plaintiff,
Social Security No.: XXX-XX-
date of birth: ; whose last
known address is,:
(NAME)
(address)
nATC OF MARRIAGE AND DATE OF DIVORCE
9, The Participant and the Alternate Payee were married on:
and divorced on:
I+; � � CTIVEDATE Oi,TFUS ORDER.
10, This DRO shall take effect upon filing with the clerk of the Circuit Court
and the acceptance by the Plan pursuant to Section 9 and,thereafter, shall be binding upon the
Plan.
PARTIAL ASSIGNMENT OF ItCTIR-1 MENT BEMI', ITS
11. The purpose of this DRO is solely to divide between the Plaintiff and
Defendant the periodic monthly pension benefit, and identified increases thereto, that would
otherwise be due and payable to the Participant during the joint lifetime of the Plaintiff and
Defendant pursuant to the Retirement System Plan. The Participant assigns to the Alternate
Payee a portion of his/her benefits from the Retirement System Plan and the Retirement System
will pay benefits directly to the Alternate Payee and Participant according to the following terms
and conditions:
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a. It is the Participant and Alternate Payee's (collectively, the "Parties")
intention and the order of this Court that effective upon approval of this
DRO by the Plan, the Alternate Payee shall receive directly during the
joint lifetime of the Parties a monthly benefit i?rom the Retirement System
of % of the amount of'tile Participant's monthly retirement benefit
allowance together with a pro rata share of any guaranteed automatic
annual benefit increases; and that the monthly benefit the Participant
would otherwise receive, but for this Order, shall be reduced by the sum
paid directly to the Alternate Payee. Benefit distributions to the Alternate
Payee under this DRO.shall cease upon the death of the Participant or the
Alternate Payee, whichever shall first occur.
b; Nothing in Section 7a. of this DRO is intended, nor shall it alter or have
any effect upon:
(i) the right of the Alternate Payee.to receive the"surviving spouse"
benefits under the "%® survivor option of the Plan,provided
that said option was elected or established by the Participant at:the
time of retirement, and at the time of retirement the Alternative
Payee was the Participant's named spouse; or
(ii) the right of the Participant to receive 100% of the Participant's
benefit if he/she survives the Alternate Payee.
c. Direct payments from the Plan to the Alternate Payee under Section 7a.
shall commence as soon as possible following approval of this DRO under
Section 9 and continue thereafter so long as Section 7a, remains in effect.
d. If the Retirement System pays any post-retirement cost of living benefit
increase(i.e.,non-guaranteed annual increases,,supplemental
payments/13th checks, one-time increases) oat.the benefits being paid from
the Retirement System during the Parties?joint life, tho Alternate Payee
shall receive directly % of each suer increase that is paid on and
after the date of this DRO.
e, Effective as of the first payment made by the Retirement System directly
to the Alternate Payee under Section 7a., the Alternate Payee shall include
in his/her gross income, in the tax year of receipt, all retirement benefit
distributions that he/she receives pursuant to the Participant's assignment
of benefits under this DRO; and, accordingly, the Participant shall not
include such benefit distributions in his/her gross income. The Alternate
Payee shall be treated as the sale distributes; under IRC Sections 72 and
402 of any payment Or distribution that is rnade to hiij�/leer under the
Participant's riasignmenl of benefits tinder this DRO- 'I'he Participant shall
be responsible for all income taxes accruing, on the rctiren'ient beueiit
distributions he/she receives cirectly from the Plan.
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12. No provision of this DRO is intended, nor shall be construed, to require
the Plan to do or incur any of the following;
a. make any payment or take any action which is inconsistent with any
federal law, rule, regulation, or applicable judicial decision;
b. provide any type or form of benefit, or any option, which is not otherwise
provided for under the provision of the Plan;
C. provide increased benefits;
d. alter or amend the established survivor benefits of either Party, as selected
and determined under the Plan by the Participant at the time of retirement;
e. incur any greater cost or liability to the Retirement System or Plan than
existed before the entry of this.DRO; and/or,
f, provide benefits to the Alternate Payee which are required to be paid to
another Alternate Payee under another order previously determined to be a
DRO, a Qualified Domestic Relations Order, or an Eligible Domestic
Relations Order under 1991 PA 46, as amended.
13. In the event the Plan or the designated Plan representative determines this
order is not a Domestic Relations Order satisfactory to the Plan,the Participant and the Alternate
Payee hereby agree, and shall submit to this Court, a request to modify this order to make it a
Domestic Relations Order satisfactory and acceptable to the Plan and the designated Plan
representative in such a manner that it will reflect the Parties' intent as herein expressed and
thereafter enter an order modifying this order to comply with the Plan and related legislation.
Said modified order will be entered nurse pro tunc if appropriate to comply with laws and
regulations.
14. In the event that the Participant, Alternate Payee, or any other person
claiming a right under this DRO, makes a claim that the Plan or the designated Plan
representative deems to be inconsistent with this DRO, the Plan may cease malting further
payments to any person whose rights under the Plan, in the sole judgment of the designated Plan
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representative, may be affected by such claim, until the claim is resolved or until further order o1'
a court of competcnt jurisdiction. The Plan may also take such further action as may be deemed
appropriate under the circumstances and as may be permitted by law with respect to such claim,
15. The Participant and the Alternate Payee agree to share equally and pay in
advance any and all additional administrative and/or actuarial costs or fees incurred or required
by the Retirement System to effectuate this DRO and each Party shall, upon request,perform any
act and complete any form reasonably necessary to carry into effect the terms of this.DRO.
16. In the event that the Retirement System makes any payment in fulfillment
of this DRO to the Participant or the Alternate Payee; respectively, and it is subsequently
determined that the payment should have been made to the other Party,the Parties agree that the
Retirement System may adjust future payments between the Parties to correct the payments.
17. This DRO is issued pursuant to the laws of the State of Michigan relating
to the division of marital property and alimony, specifically including MCL 552.18, MCL
552.101, and.MCL 38.1684,which relate to the inclusion of retirement benefits in the marital
estate and the determination of spousal rights with respect to such retirement benefits and
Judgment of Divorce.
Hon.
Circuit Judge
COUNTERSIGNED:
Deputy Court Clerk
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Approved as to form and content:
PLAINTIFF ATTORNEY FOR PLAINTIFF
Dated• Dated:
DEFENDANT ATTORNEY FOR DEFENDANT
Dated:. Dated:
Prepared by:
(Attorney name) (P#)
(Firm name)
(address)
(telephone)
$;lgll.,uy Counsel UMOM'M:DIU)M licy w loner wpd 9