DROP COST Clause Samples

DROP COST. The City and those applicable collective bargaining associations which agree to adopt the DROP Program intend for the DROP Program to be essentially cost neutral (i.e., ± .2% of covered payroll). The parties recognize the complexity in estimating the actuarial cost impact of the DROP on the Police and Fire Retirement System. Accordingly, after a 10 year period from the establishment of the DROP, the Retirement Board will direct that the Retirement System’s Actuary to conduct an evaluation as to the cost impact of the DROP on the Retirement System. In the event that the actuary determines that the DROP has had a positive cost to the Retirement System (i.e., > .2% of covered payroll), the DROP shall be amended in such manner, as recommended by the Actuary and approved by the parties, to result in an essentially cost neutral program. In the event that the City determines that the DROP has had a positive cost to the City, the DROP shall be amended and approved by the parties. Dearborn Heights Police and Fire Act 345 Retirement System members currently covered by their respective bargaining agreement upon ratification of this language, (January 11, 2007) shall not be adversely impacted by any future amendments and will be governed under the current terms and conditions of this section. Further, subsequent amendments to the DROP will not impact DROP Participants. The City of Dearborn Heights disclaims any and all responsibility for any tax implications that may affect a DROP Participant. The City recommends that each Employee consult with a professional tax advisor, certified professional accountant, or other such individual capable of providing tax advice.