Affirmation of Authorization to Pick-up the Employee’s Contribution to
§ 414(h) of the Internal Revenue Code


WHEREAS, ALBEMARLE COUNTY provides its employees with tax deferral pursuant to §414(h) of the Internal Revenue Code with respect to their member contributions to the Virginia Retirement System (referred to as VRS) by picking up member contributions to VRS; and


WHEREAS, VRS keeps track of such picked up member contributions, and treats such contributions as employee contributions for all purposes of VRS; and


WHEREAS, the Internal Revenue Service in Notice 2006-43 has provided transition relief for existing pick up arrangements provided that an authorized person takes formal action to evidence the establishment of the pick-up arrangement no later than January 1, 2009; and  


WHEREAS, in order to avail itself of the protection given under Notice 2006-43, ALBEMARLE COUNTY desires to affirm its intention to establish and maintain a pickup arrangement through formal action by its governing body.


NOW, THEREFORE, IT IS HEREBY RESOLVED that the existing member contribution pick-up arrangement is hereby affirmed as it relates to salary reduction elections in effect prior to the date of this Resolution; and it is further

RESOLVED that effective the first pay day on or after August 6, 2008, ALBEMARLE COUNTY shall pick up member contributions of its employees to VRS, and such contributions shall be treated as employer contributions in determining tax treatment under the Internal Revenue Code of the United States; and it is further

RESOLVED that such contributions, although designated as member contributions, are to be made by the ALBEMARLE COUNTY in lieu of member contributions; and it is further

RESOLVED that pick up member contributions shall be paid from the same source of funds as used in paying the wages to affected employees; and it is further

RESOLVED that member contributions made by the ALBEMARLE COUNTY under the pick up arrangement shall be treated for all purposes other than income taxation, including but not limited to VRS benefits, in the same manner and to the same extent as member contributions made prior to the pick up arrangement; and it is further

RESOLVED that nothing herein shall be construed so as to permit or extend an option to VRS members to receive the pick up contributions made by the ALBEMARLE COUNTY directly instead of having them paid to VRS; and it is further

RESOLVED that notwithstanding any contractual or other provisions, the contributions of each member of VRS who is an employee of the ALBEMARLE COUNTY shall be picked up either through a reduction in the current salary of such employee or as an offset against future salary increases of such employee or as a combination of both at the option of the employer by the ALBEMARLE COUNTY on behalf of such employee pursuant to the foregoing resolutions.

Adopted in CHARLOTTESVILLE, Virginia this ______ day of _________________, 2008.


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