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HomeMy WebLinkAbout2002-12-17-0900AM-RegularFILED 2002 DEC 13 A c~ 02 BRAZOS CiOUNTY. Y LLERK 13 L~YL;N.IEXAS BRYAN. TEXAS NOTICE OF MEETING AND AGENDA BRAZOS COUNTY COMMISSIONERS COURT THE COMMISSIONERS COURT WILL MEET IN REGULAR SESSION ON TUESDAY, DECEMBER 17, 2002 AT 9:00 A.M. IN THE 85TH DISTRICT COURTROOM OF THE BRAZOS COUNTY COURTHOUSE, 300 EAST 26""' STREET, SUITE 224, BRYAN, TEXAS. 1. Invocation and Pledge of Allegiance - Judge Jones. 2. Presentation to Congressman Kevin Brady. 3. Recess for reception for Congressman Kevin Brady. 4. Reconvene Commissioners Court session in the Commissioners Courtroom, Suite 115 of the County Courthouse. 5. Call for citizen input and/or concerns. Consider and take action on agenda items 6 - 20: 6. Budget Amendment 02/03-10. 7. Payment of Claims. 8. Personnel Changes of Status. 9. Cancellation of the December 24, 2002 Commissioners Court meeting. 10. Request by the County Clerk to establish the pay rate for the election tabulation supervisor and two assistants and to correct the rate paid for the November 5, 2002 General Election. 11. Amendment and restatement of the original Brazos County Flexible Benefit Cafeteria Plan to be effective January 1, 2003. Commissioners Court Meeting Agenda December 17, 2002 Page Two 12. Appointing an agricultural representative to the Brazos Valley Groundwater Conservation District Board of Directors. 13. Agreement with Ben Sanford & Associates, Inc. to provide a billing audit of the inmate telecommunications services. • 14. Applications for Tax Refunds from the following: a. Larry Gilbert b. Transamerica Real Estate Tax Service (3 accounts) C. William E. Heitkamp, Chapter 13 Trustee for Thomas Allen Reed d. Elvora McCurty e. Edward B. & Joann Hastings, Jr. f. Ameriquest Mortgage Company (Larry Mack Bean) g. Option One Mortgage Company (Juanita J. Mosley) h. Briarcrest Veterinary Clinic 15. Authorizing the Brazos County Information Technology Project Manager to negotiate with The Software Group on the price for the "Multiple Charge" enhancement. 16. Authorizing the Purchasing Department to remove all office supply vendors from the exemption list. 17. Award of Bid #2003-013 - Office Supplies. • 18. Blanket Purchase Order to Bryan 800 Communications for the transfer and installation of equipment in new Sheriffs Office vehicles. 19. Blanket Purchase Orders. 20. Re-submission, for correction, of the Final Plat of Hidalgo Falls Subdivision, 48.694 acres, H. & B. Whiteside Survey. Site is located in Precinct 1. 21. Announcement of interest items and possible future agenda topics. 22. Call for citizen input and/or concerns. 23. Adjourn. The Courthouse is wheelchair accessible. Handicap parking spaces are available. Any request for sign interpretive services must be made two business days before the meeting. To make arrangements, call (979) 3614102. is COMMISSIONERS' COURT REGULAR MEETING DECEMBER 17, 2002 A regular meeting of the Commissioners' Court of Brazos County, Texas was held in the 85th District Courtroom in the Courthouse in Bryan, Brazos County, Texas, beginning at 9:00 a.m. on Tuesday, December 17, 2002, with the following members of the Court present: Alvin W. Jones, County Judge, Presiding; Tony Jones, Commissioner of Precinct 1; Wm. S. Thornton, Commissioner of Precinct 2; C. B. Jones, Commissioner of Precinct 3; Carey Cauley, Jr., Commissioner of Precinct 4; Karen McQueen, County Clerk. The attached sheet contains the names of the citizens and officials that were in attendance. The County Judge gave the invocation and led the pledge of allegiance. The County Judge presented United States Congressman Kevin Brady with a plaque and thanked him for his support to Brazos County during his six (6) years in office. Representative Brady thanked the Court and then introduced his staff. At 9:20 a.m. the County Judge then recessed the Commissioners Court meeting so that everyone could attend a VOL 3q PAGE l & ~p • Commissioners Court meeting December 17, 2002 2 reception for Congressman Brady in the commons area of the Courthouse. At 10:05 a.m. the County Judge reconvened the Commissioners Court meeting in the Commissioners Courtroom. There was no citizen input/and or concerns The Court next considered Budget Amendment #02/03-10.1 through 10.3, which would reallocate funds for the Justice of • the Peace, Precinct 4 and the Road and Bridge Department and transfer funds from Contingency to Community Support. On motion by Commissioner Cauley, seconded by Commissioner Tony Jones, the Court voted unanimously to approve the budget amendment as submitted, a copy of which is attached. The Court next considered the following Claims as submitted by the County Treasurer for payment: 20037480 through 20037715 On motion by Commissioner C. B. Jones, seconded by Commissioner Thornton, the Court voted unanimously to approve • the Claims as d i tte . subm The Court proceeded to consider the change of status of employees as submitted on the attached Personnel Action Requests. On motion by Commissioner Cauley, seconded by VOL 39 PAGE / 0 40 Commissioners Court meeting December 17, 2002 3 Commissioner Thornton, the Court voted unanimously to approve the changes as submitted. The Court next considered the cancellation of the December 24, 2002 Commissioner Court meeting. On motion by Commissioner Thornton, seconded by Commissioners Tony Jones, C. B. Jones, Cauley and the County Judge, the Court voted unanimously to approve the cancellation of the December 24, 2002 Commissioner Court meeting. The next matter before the Court was a request by the County Clerk to establish the pay rate for the election tabulation supervisor and two assistants and to correct the rate paid for the November 5, 2002 General Election. On motion by the County Judge, seconded by Commissioners Thornton and Cauley, the Court voted unanimously to remove this item from the agenda due to the County Clerk not being present at the meeting. The Court next considered an amendment and restatement of the original Brazos County Flexible Benefit Cafeteria Plan to be effective January 1, 2003. On motion by Commissioner Tony Jones, seconded by Commissioner Thornton, the Court voted unanimously to approve the amendment and restatement of the original Brazos County Flexible Benefit Cafeteria Plan. A copy is attached. VOL Jg PAGE 1&8 • Commissioners Court meeting December 17, 2002 4 The next matter for consideration was the appointment of an agricultural representative to the Brazos Valley Groundwater Conservation District Board of Directors. car, motion by Commissioner Tony Jones, seconded by Commissioner Thornton, the Court voted unanimously to appoint Roger Wayne Wilson to the Board. The Court next considered an agreement with Ben Sanford & • Associates, Inc. to provide a billing audit of the inmate telecommunications services. Cost to Brazos County will be fifty percent (50%) of all refunds or billing credits obtained by Ben E. Sanford & Associates. On motion by Commissioner Tony Jones, seconded by Commissioner Cauley, the Court voted unanimously to enter into agreement with Ben Sanford & Associates, Inc. A copy is attached. The next matter for consideration was a tax refund to the following individuals or companies: a. Larry Gilbert - payment in error year 2002. On motion by Commissioner Tony Jones, seconded by Commissioner Cauley, the Court voted unanimously to • refund $98.92 in county taxes. b. Transamerica Real Estate Tax Service, erroneous tax payment on three (3) accounts year 2000. On motion by Commissioner Tony Jones, seconded by Commissioner Cauley, the Court voted unanimously to refund $184.74, $276.91 & $287.66 in county taxes c. William E. Heitkamp Chapter 13 Trustee for Thomas Allen Reed, Overpayment year 1997. On motion by VOL 3-9 PAGE 1(09 0 Commissioners Court meeting December 17, 2002 5 Commissioner Tony Jones, seconded by Commissioner Cauley, the Court voted unanimously to refund of $28.47 in BISD taxes. d. Mary & Lola Styles Green, overpayment year 2001. On motion by Commissioner Tony Jones, seconded by Commissioner Cauley, the Court voted unanimously to refund $12.11 in county taxes. e. Edward B Jr. & Joann Hastings, clerical error for years 1998, 1999 and 2000. On motion by Commissioner Tony Jones, seconded by Commissioner Thornton, the Court voted unanimously to refund $26.17, $18.96 & $18.96 in county taxes. f. Larry Mack Bean, overpayment year 2001. On motion by Commissioner Tony Jones, seconded by Commissioner Thornton, the Court voted unanimously to refund $136.38 in county taxes. g. Juanita J. Mosley, erroneous payment of taxes years 1999, 2000 & 2001. On motion by Commissioner Tony Jones, seconded by Commissioner Thornton, the Court voted unanimously to refund $57.34, $164.87 & $171.03 in county taxes. h. Briarcrest Veterinary Clinic, double payment years 1999, 2000 & 2001. On motion by Commissioner Tony Jones, seconded by Commissioner Thornton, the Court voted unanimously to refund $ 70.54, $61.58, $63.08 in county taxes The next matter before the Court was consideration of the authorization for the Brazos County Information Technology Project Manager to negotiate with The Software Group on the price for the "Multiple Charge" enhancement. On motion by Commissioner Cauley, seconded by Commissioner Tony Jones, the Court voted unanimously to approve the authorization. VOL 29 PAGE /70 ~J Commissioners Court meeting December 17, 2002 6 The next matter for consideration was authorization for the Purchasing Department to remove all office supply vendors from the exemption list. On motion by Commissioner Thornton, seconded by Commissioner Cauley, the Court voted unanimously to remove the following companies from the exemption list starting January 1, 2003. _ 1. 2. • 4. 5. 6. The Boise-Cascade Office Depot Office Max Quill corporation Sav-On Wilton Office Supply Court next considered awarding the following bid: Bid No. 2003-013, Office Supplies Pat Howard, Purchasing Agent, recommended acceptance of the bid submitted by Sav-On Offices Supplies. On motion by Commissioner Tony Jones, seconded by Commissioner Thornton, the Court voted unanimously to accept the recommendation of the Purchasing Agent and award the contract to Sav-On Office Supplies. A copy of the bid tabulation is attached. The Court proceeded to consider the following Blanket • Purchase Orders: Bryan 800 Sheriff $5,100 On motion by Commissioner Jones, seconded by Commissioner Thornton, the Court voted unanimously to approve the purchase order as submitted. The Court proceeded to consider the following VOL 39 PAGE ► -71 0 Commissioners Court meeting December 17, 2002 Blanket Purchase Orders: Scarmardo Produce Jail $3,150 Team systems Jail $ 900 Ray Criswell Jail $1,600 Ecolab Jail $ 700 Brazos Wholesale Jail $ 600 Lilly Dairy Jail $3,800 Butterkrust Jail $1,600 Glazier Jail $1,000 Cain's Coffee Jail $ 600 Ben E. Keith Jail $1,250 Performance Jail $7,000 Sysco Food Jail $6,200 US Food Serv Jail $6,200 7 On motion by Commissioner Tony Jones, seconded by Commissioner Cauley, the Court voted unanimously o approve the purchase orders as submitted. The Court next considered approval of the re-submission for correction of the Final Plat of Hidalgo Falls Subdivision, 48.694 Acre in Precinct 1. Richard Vance, County Engineer, stated that he had reviewed the plat and all appeared to be in order. On motion by Commissioner Tony Jones, seconded by Commissioner Cauley, the Court voted unanimously to approve the re-submission for correction of the Final Plat of Hidalgo Falls Subdivision, 48.694 Acre as submitted. Under announcement of interest items and possible future agenda topics the County Judge made the following comments: a. There will be no Commissioners Court meeting next week. VOL 31 PAGE /7-1- • Commissioners' Court meeting November 26, 2002 Susan Gandy made the following comments: a. There will be a reception on the 31st after Commissioners Court honoring outgoing Commissioners and Judge b. The Treasurer has asked everyone to pay attention to the payroll memo. Timesheets are due early because of the Christmas holidays. c. Agenda items for the December 31st Commissioners Court meeting are due no later than 9:00 a.m. Friday December 27th • County Judge continued b. Thanked the Sheriff for help with the refreshments for the reception honoring Kevin Brady. c. The oath of office for elected officials will be held on January 1, 2003 beginning at 9:00 a.m. d. He wished everyone a great holiday season and a Merry Christmas. There being no further business to come before the Court, the meeting was adjourned. • VOL 39 PAGE 03 8 n U The foregoing minutes of the Commissioners Court meeting held December 17, 2002 have been examined and are approved in open i Court this the day of 2003, in Bryan, Brazos County, Texas. W'I~ '~z Randy 'ms Count Judge issioner, Precinct 1 Duane Peters Kenny Mallar Commissioner, Precinct 2 Commissioner, 4recinct 3Q Carey Cauley, Jr. Commissioner, Precinct 4 ar n McQueen County Clerk VOL 31 PAGE 17 ~ • • 0 BRAZOS CO T TY `COMMISSIONERS COURT MEETING ON 7 200L.;-AT BRAZOS CO 'CONMSSIONERS CQURT MEETING ON 1 • ~j'7 200 Z AT d - •T C~ . Ole xis Coa&ry NAME ` OR NIZATI N/DEPART NT z7- ~K f is Z 2 ~r d 1LL 1 "AA 3q r~ 9- BRAZOS COUNTY, TEXAS BUDGET AMENDMENT(S) FOR THE 2002-2003 BUDGET YEAR NO. 02/03-10.1 through 10.3 On this the 17th day of December 2002 at a regular meeting of the Commissioners' Court, the following members were present: Alvin W. Jones, County Judge, Presiding Tony Jones, Commissioner, Precinct 1; Wm. S. Thornton, Commissioner, Precinct 2; C. B. Jones, Commissioner, Precinct 3; Carey Cauley, Jr., Commissioner, Precinct 4; Karen McQueen, County Clerk. • The following proceedings were held: THAT WHEREAS, on December 17, 2002 the Court heard and approved a budget amendment for the 2002-2003 budget year for Brazos County, Texas. WHEREAS, an expenditure is necessary due to the necessity to meet unusual and unforeseen conditions which could not be reasonably included in the original budget adopted August 23, 2002 the following amendment(s) to the original are hereby authorized, as described on the attached page (s) . ADOPTED AND APPROVED this the 17th day of December, 2002. THE COMMISSIONERS' COURT OF BRAZOS COUNTY, TEXAS. By: Alvin W. Jones, County Judge Original: County Clerk's Office and attached to the original budget Copies: County Auditor County Treasurer Commissioners' Court Minutes wnw 0 BRAZOS COUNTY, TEXAS BUDGET AMENDMENTS No. 02103-10.1 12/17/2002 FD DIV ACCT PROJ DR/CR ACCOUNT NAME Increase Decrease 01 241011 672300 Dr. Copier 70.00 01 241011 652000 Cr. Copier Maintenance 70.00 Justice of the Peace Precinct 4 To increase the minor acauisition budget to allow the purchase of the copier that was appropriated $70 short of the bid vrice. .OEM&= I=_ 9- BRAZOS COUNTY, TEXAS BUDGET AMENDMENTS No. 02/03-10.2 12/17/2002 FD DIV ACCT PROJ DR/CR ACCOUNT NAME Increase Decrease 01 560010 725900 Dr. Professional Fees 50,000.00 01 560010 657100 Cr. Right of Way 50,000.00 Road & • • 40 r- BRAZOS COUNTY, TEXAS BUDGET AMENDMENTS No. 02/03-10.3 12/17/2002 FD DIV ACCT PROD DR/CR ACCOUNT NAME Increase Decrease 01 110020 730300 DR Boys & Girls Club $ 50,000.00 01 110015 611300 CR Contingency $ 50,000.00 To provide continued funding for the Boys and Girls Clubs of Brazos Valle that was overlooked during the budeet process. Iii -Mftm~ ZL- PERSONNEL CHANGE OF STATUS page 1 of 1 COURT DATE: December 17, 2002 DEPARTMENT: Personnel PURPOSE: AR~rove Personnel Change of Status DEPARTMENT NAME EMPLOYEE NAME ACTION REQUESTED TAX OFFICE ESPINOZA, FELICIA TRANSFER WITHIN DEPT. SHERIFF'S OFFICE ALLEN, TONI Y. RESIGNATION SHERIFF'S OFFICEIJAIL IRWIN, KATHERINE J. NEW HIRE - FULL TIME TIISON, JEFFREY NEW HIRE - FULL TIME CONSTABLE, PCT. 2 TIGERINA, ADRIAN RESIGNATION MCDERMOTT, CHRISTOPHER PROMOTION EMERT, STEVEN L. TRANSFER FROM ANOTHER DEPT. CONSTABLE, PCT. 4 YBARRA, CARLOS NEW HIRE - PART TIME CONSTABLE, PCT. 2 PETERS, E. DUANE ELECTED COMM., PCT. 2 - EFFECTIVE 1-1-2003 LAMPO, DONALD J. ELECTED CONSTABLE, PCT. 2- EFFECTIVE 1-1-2003 • Approved in Commissioners' Court: December 17, 2002 County Judge's or Commissioner's Signature: (This copy to be attached to minutes) 0 c_ - 11 BRAZOS COUNTY FLEXIBLE BENEFIT CAFETERIA PLAN INTRODUCTION The Employer has adopted this Plan with an effective date of March 1, 1987 to recognize the contribution made to the Employer by its Employees. Its purpose is to reward them by providing benefits for those Employees who shall qualify hereunder and their dependents and beneficiaries. The concept of this plan is to allow Employees to choose among different types of benefits based on their own particular goals, desires, and needs. The Plan shall be known as the Brazos County Flexible Benefit Cafeteria Plan (the "Plan"). The intention of the Employer is that the Plan qualify as a "Cafeteria Plan" within the meaning of Section 125 of the Internal Revenue Code of 1986, as amended, and that the benefits which an Employee elects to receive under the Plan be includable or excludable from the Employee's income under Section 125(a) and other applicable sections of the Internal Revenue Code of 1986, as amended. This is an amendment and restatement of the Plan originally adopted March 1, 1987. The date of the amendment and restatement of the Plan is effective January 1, 2003. • " THE BRAZOS COUNTY FLEXIBLE BENEFIT CAFETERIA PLAN ADOPTION AGREEMENT AND SUMMARY PLAN EFFECTIVE JANUARY 1, 2003 (This is an amendment and restatement of the Plan originally adopted March 1, 1987) A. Employer Information 1. Name of Employer: Brazos County 2. Address: 300 East 26th Street, #107, Bryan, TX 77803 3. Telephone: 979-361-4117 4. Employer Identification Number. 746000433 5. Nature of Business: Local County Government 6. Name of Plan: The Brazos County Flexible Benefit Cafeteria Plan 7. Plan Number. 501 8. Plan Administrator, if other than Employer. N/A B. Effective Date Effective Date of Plan: March 1, 1987 If this is an amendment to an existing plan, (1) Effective Date of the Restatement and Amendment January 1, 2003 (2) Original Effective Date of Plan: March 1, 1987 C. Plan Year The first plan year began on March 1, 1987 and ended December 31, 1987. Subsequent Plan Years are from January 1st thru December 31st. 0. Eligibility Requirements for Participation 1. Length of Service: First of month following 30 days of employment 2. All regular employees working 32+ hours per week. 3. Age: Minimum age 21 (may not exceed 21 years of age) X No minimum age E. Employer Contributions 1 31 0 1. Non-Elective Contributions: The Employer may at its sole discretion provide a non-elective contribution to provide benefits for each Participant under the Plan. This amount will be set by the Employer each Plan Year in a uniform and nondiscriminatory manner. If this non-elective contribution amount exceeds the cost of benefits elected by the Participant: (a) No excess amounts will be paid to the Participant; or (b) Excess amounts will be paid to the Participant as a taxable cash benefit option. 2. X Elective Contributions (Salary reduction): 3. Cash 4. Other Each Participant may authorize the Employer to reduce his or her compensation by the amount needed for the purchase of benefits elected, less the amount of non-elective contributions. An election for salary reduction will be made on the benefit election form. The maximum amount available to each Participant for the purchase of elected benefits through Salary reduction will be: (a) $ per Plan Year, or a prorated amount for a short Plan Year. (b) X Unlimited per Plan Year (Premium Only Accounts) (c) X_ $4,000.00 per Plan Year for the Health Reimbursement FSA; (d) __X__$5,000.00 per Plan Year for the Dependent Care Assistance Reimbursement FSA. F. Available Benefits Each of the following components should be considered a plan that comprises this Plan. Eligibility requirements may differ from those set forth in Item (D) above, and can be noted by reading the associated insurance contracts. X 1. Hospital and Surgery Insurance - The terms, conditions, and limitations for the Group Hospital and Surgery Insurance will be as set forth in the insurance policy. (See Section 4.4 of the Plan Document) X_ 2. Disability and/or Accident Income Insurance - The terms, conditions and limitations for the Disability and/or Accident Income Insurance will be as set forth in the policy. (See Section 4.7 of the Plan Document) X 3. Dental Insurance - The terms, conditions and limitations for the Dental Insurance will be as set forth in the Insurance policy. (See Section 4.5 of the Plan Document) X 4. Group Life Insurance - Limited to $50,000 face amount per participant. 5. Vision Insurance - The terms, conditions and limitations for the Vision Insurance will be set forth in the Insurance policy. (See Section 4.8 of the Plan Document) 2 1 7-.~ 6. Cancer Insurance - The terms, conditions and limitations for the Cancer Insurance will be set forth in the Insurance policy. (See Section 4.9 of the Plan Document) X 7. Health Care Reimbursement - (See Section 6.1 of the Plan Document) X 8. Dependent Care Reimbursement - (See Sections 7.1 of the Plan Document) G. Change of Benefit Elections (See Section 5.4 of the Plan Document) Any Participant desiring to make a change of election(s) must notify and make such election(s) within 60 days of an eligible event. For details outlining what events are considered examples of a change in family status and the procedures to make such election changes, see Section 5.4 of the Plan Document. H. Flexible Spending Accounts (FSAs) claims procedures - (See specific Plan provisions as referenced above in F (7) and F (8)). If FSAs for either/both Health or Dependent Care benefits are elected under this Plan, the elected amounts will be deducted from each pay check and held In a separate account. Upon submission of completed voucher with attached receipts and documentation validating that the service was provided during the Plan Year, the Participant will be reimbursed for the amount of the voucher, up to the annual election amount for FSA Benefits (subject to stated maximums above). Any monies not claimed within 90 days after the end of the Plan Year will be forfeited. If termination of employee's services occurs, the employee may elect to continue coverage that is in force at the time of termination. Election to continue must be made in writing to the Plan Administrator within 60 days. STATEMENT OF ERISA RIGHTS • You have certain rights and protections provided by the Employee Retirement Income Security Act of 1974 (ERISA). This law provides for the following: 1. You can examine all Plan Documents. These include the insurance contracts and copies of all documents filed by the Plan with the U.S. Department of Labor (DOL). The documents filed with the DOL include such items as annual reports and plan descriptions. The Plan cannot charge you to examine these documents. However, you can only examine them at the office of the Plan Administrator. 2. You can obtain copies of all Plan documents and other Plan data. This request must be written and given to the Plan Administrator. The Administrator may make a reasonable charge for the copies. 3. You will receive a summary of the Plan's annual financial report, if required of the Plan. The law requires the Plan Administrator to provide this report to each plan participant. ERISA also imposes duties upon the people who operate the employee benefit plan. These people are fiduciaries, and they must act prudently and with the sole interests of you and other Plan Participants in mind. No one, not even your employer, may fire you or discriminate against you in order to prevent you r~ U from obtaining a welfare benefit or exercising your rights under ERISA. Under ERISA, there are steps you can take to enforce the above-rights. The following are examples. If requested materials are not received within 30 days, you may bring a legal action in state or federal court. You can also seek help from the courts if a consideration of a claim has been denied or ignored. Further, if Plan fiduciaries misuse Plan assets you can file legal actions. If Plan assets are misused by fiduciaries, you may also seek assistance from the U.S. Department of Labor. If you take legal action, the court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. However, if you lose, the court may order you to pay these costs and fees (if it finds, for example, that your claim is frivolous). If you have any questions about this statement or about your rights under ERISA, you should contact the nearest office of the Pension and Welfare Benefits Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, U.S. Department of Labor, 200 Constitution Avenue, N.W. Washington, D.C. 20210. The Plan shall be construed, enforced and administered, and the validity determined in accordance with the Employee Retirement Income Security Act of 1974, (ERISA, as amended), the Internal Revenue Code of 1986 (as amended), and the laws of the State of Texas. Should any provision be determined to be void, invalid or unenforceable by any court of competent jurisdiction, the Plan will continue to operate, and for purposes of the jurisdiction of the court only, will be deemed not to include the provision determined to be void. We have consulted our attorney with reference to this Plan and Adoption Agreement. This Plan is hereby adopted this 17th day of December , 2002. Employer: Brazos County By. q4:- Title: Alvin W. Jones, County Judge WITNESS: el, 4 TABLE OF CONTENTS ARTICLE I DEFINITIONS ARTICLE II PARTICIPATION 2.1 ELIGIBILITY 2.2 EFFECTIVE DATE OF PARTICIPATION 2.3 APPLICATION TO PARTICIPATE 2.4 TERMINATION OF PARTICIPATION 2.5 CHANGE OF EMPLOYMENT STATUS 2.6 TERMINATION OF EMPLOYMENT 2.7 DEATH ARTICLE III CONTRIBUTIONS TO THE PLAN 3.1 SALARY REDIRECTION 3.2 APPLICATION OF CONTRIBUTIONS 3.3 PERIODIC CONTRIBUTIONS ARTICLE IV BENEFITS 0- 4.1 BENEFIT OPTIONS 4.2 HEALTH CARE REIMBURSEMENT PLAN BENEFIT 4.3 DEPENDENT CARE ASSISTANCE PROGRAM BENEFIT 4.4 HEALTH INSURANCE BENEFIT 4.5 DENTAL INSURANCE BENEFIT 4.6 GROUP-TERM LIFE INSURANCE BENEFIT 1 39 • 4.7 DISABILITY BENEFIT 4.8 VISION INSURANCE BENEFIT 4.9 HOSPITAL INDEMNITY POLICY 4.10 CASH BENEFIT 4.11 NONDISCRIMINATION REQUIREMENTS ARTICLE V PARTICIPANT ELECTIONS 5.1 INITIAL ELECTIONS 5.2 SUBSEQUENT ANNUAL ELECTIONS 5.3 FAILURE TO ELECT 5.4 CHANGE OF ELECTIONS ARTICLE VI HEALTH CARE REIMBURSEMENT PLAN 6.1 ESTABLISHMENT OF PLAN 6.2 DEFINITIONS 6.3 FORFEITURES 6.4 LIMITATION ON ALLOCATIONS 6.5 NONDISCRIMINATION REQUIREMENTS 6.6 COORDINATION WITH CAFETERIA PLAN 6.7 HEALTH CARE REIMBURSEMENT PLAN CLAIMS ARTICLE VII DEPENDENT CARE ASSISTANCE PROGRAM 7.1 ESTABLISHMENT OF PROGRAM 7.2 DEFINITIONS 7.3 DEPENDENT CARE ASSISTANCE ACCOUNTS 2 --11\ • ' t 7.4 INCREASES IN DEPENDENT CARE ASSISTANCE ACCOUNTS 7.5 DECREASES IN DEPENDENT CARE ASSISTANCE ACCOUNTS 7.6 ALLOWABLE DEPENDENT CARE ASSISTANCE REIMBURSEMENT 7.7 ANNUAL STATEMENT OF BENEFITS 7.8 FORFEITURES 7.9 LIMITATION ON PAYMENTS 7.10 NONDISCRIMINATION REQUIREMENTS 7.11 COORDINATION WITH CAFETERIA PLAN • 7.12 DEPENDENT CARE ASSISTANCE PROGRAM CLAIMS ARTICLE VIII ERISA PROVISIONS 8.1 CLAIM FOR BENEFITS 8.2 APPLICATION OF BENEFIT PLAN SURPLUS 8.3 NAMED FIDUCIARY 8.4 GENERAL FIDUCIARY RESPONSIBILITIES 8.5 NON-ASSIGNABILITY OF RIGHTS ARTICLE IX ADMINISTRATION 9.1 PLAN ADMINISTRATION 9.2 EXAMINATION OF RECORDS 9.3 PAYMENT OF EXPENSES 9.4 INSURANCE CONTROL CLAUSE 9.5 INDEMNIFICATION OF ADMINISTRATOR 3 0 ARTICLE X AMENDMENT OF TERMINATION OF PLAN 10.1 AMENDMENT 10.2 TERMINATION ARTICLE XI MISCELLANEOUS 11.1 PLAN INTERPRETATION 11.2 GENDER AND NUMBER 11.3 WRITTEN DOCUMENT 11.4 EXCLUSIVE BENEFIT 11.5 PARTICIPANTS RIGHTS 11.6 ACTION BY THE EMPLOYER 11.7 EMPLOYER'S PROTECTIVE CLAUSES 11.8 NO GUARANTEE OF TAX CONSEQUENCES 11.9 INDEMNIFICATION OF EMPLOYER BY PARTICIPANTS 11.10 FUNDING 11.11 GOVERNING LAW 11.12 SEVERABILITY 11.13 CAPTIONS 11.14 CONTINUATION OF COVERAGE 11.15 FMLA LEAVE 11.16 USERRA LEAVE 4 E ARTICLE I DEFINITIONS 1.1 "Administrator" means the individual(s) or corporation appointed by the Employer to carry out the administration of the Plan. In the event the Administrator has not been appointed, or resigns from prior appointment, the Employer shall be deemed to be the Administrator. 1.2 "Affiliated Employee' means the Employer and any corporation which is a member of a controlled group of corporations (as defined in Code Section 414(b)) which includes the Employer, any trade or business (whether or not incorporated) which is under common control (as defined in Code Section 414(c)) with the Employer, any organization (whether or not • incorporated) which is a member of an affiliated service group (as defined in Code Section 414(m)) which Includes the Employer, and any other entity required to be aggregated with the Employer pursuant to Treasury regulations under Code Section 414(0). 1.3 "Benefit" means any of the optional benefit choices available to a Participant as outlined in Section 4.1. 1.4 "Cafeteria Plan Benefit Dollars" means the amount available to Participants, pursuant to Article III, to purchase Benefits. Each dollar contributed to this Plan shall be converted into one Cafeteria Plan Benefit Dollar. 1.5 'Code" means the Internal Revenue code of 1986, as amended or replaced from time to time. 1.6 "Compensation" means the total cash remuneration received by the Participant from the Employer, during a Plan Year prior to any reductions pursuant to a Salary Redirection Agreement authorized hereunder. Compensation shall include any overtime, commissions and bonuses. • 1.7 "Dependent" means any individual who qualifies as a dependent under an Insurance Contract or under Code Section 152 (as modified by Code Section 105(b)). 1.8 "Effective Date" means March 1, 1987 for the adoption of the Plan. For this restatement and amendment of the Plan it means January 1, 2003. 1.9 "Election Period" means the period immediately preceding the beginning of each Plan Year established by the Administrator for the election of Benefits and Salary Redirections, such period to be applied on a uniform and nondiscriminatory basis for all Employees and Participants. However, an Employee's initial Election Period shall be determined pursuant to Section 5.1. E 1.10 "Eligible Employee" means any Employee who has satisfied the provisions of Section 2.1. 1.11 "Employee" means any person who is employed by the Employer, but excludes any person who Is employed as an independent contractor. However, any Employee who is a "part-time" Employee shall not be eligible to participate in this Plan. A "part-time" Employee is one who works, or is expected to work on a regular basis, less than 32 hours a week and is designated as a part-time employee on the Employer's personnel records. 1.12 "Employer means Brazos County and any successor which shall maintain this Plan; and any predecessor which has maintained this Plan. 1.13 "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time. 1.14 "Highly Compensated Employee" means, for the purposes of determining discrimination, an Employee described in Code Section 414(q) and the Treasury regulations thereunder. 1.15 "Insurance Contract" means any contract issued by an Insurer underwriting a Benefit. 1.16 "Insurance Premium Payment Plan" means the plan of benefits contained in Section 4.1 of this Plan, which provides for the payment of Premium Expenses. 1.17 "Insurer" means any insurance company that underwrites a Benefit under this Plan. 1.18 "Key Employee" means an Employee defined in Code Section 416(1)(1) and the Treasury regulations thereunder. 1.19 "Participant" means any Eligible Employee who elects to become a Participant pursuant to Section 2.3 and has not for any reason become ineligible to participate further in the Plan. 1.20 "Plan" means this instrument, including all amendments thereto. 1.21 "Plan Year" means the period beginning March 1, 1987 and ending December 31, 1987 the first plan year. In subsequent plan years it shall mean January 1 st thru December 31 st. In the event a Participant commences participation during a Plan Year, then the initial period shall be that portion of the Plan Year commencing on such Participant's date of entry and ending on the last day of such Plan Year. 1.22 "Premium Expenses" or "Premiums" mean the Participant's cost for the insured Benefits described in Section 4.1. 1.23 "Premium Reimbursement Account" means the account established for a Participant pursuant to this Plan to which part of his/her Cafeteria Plan Benefit Dollars may be allocated and from which Premiums of the Participant may be paid or reimbursed. If more than one type of insured Benefit is elected, sub-accounts shall be established for each type of insured -39 • Benefit. 1.24 "Salary Redirection" means the contributions made by the Employer on behalf of Participants pursuant to Section 3.1. These contributions shall be converted to Cafeteria Plan Benefit Dollars and allocated to the funds or accounts established under the Plan pursuant to the Participants elections made under Article V. 1.25 "Salary Redirection Agreement" or "Salary Reduction Agreement" means an agreement between the Participant and the Employer under which the Participant agrees to reduce his/her Compensation or to forego all or part of the increases in such Compensation and to have such amounts contributed by the Employer to the Plan on the Participant's behalf. The Salary Redirection Agreement shall apply only to Compensation that has not been actually or constructively received by the Participant as of the date of the agreement (after taking this Plan and Code Section 125 into account) and, subsequently does not become currently available to the Participant. • 1.26 "Spouse" means the legally married husband or wife of a Participant, unless legally divorced by court decree. ARTICLE II PARTICIPATION 2.1 ELIGIBILITY Any Eligible Employee shall be eligible to participate hereunder as of the first of the month following 30 days of active full-time employment (or the Effective Date of the Plan, if later). If a former Participant Is rehired during the same period in which termination of employment occurs, and such former Participant had revoked existing Benefit elections and terminated the receipt of Benefits at the time of termination of employment, then such rehired former Participant shall be prohibited from making new Benefit elections for the remaining portion of the period. 2.2 EFFECTIVE DATE OF PARTICIPATION • An Eligible Employee shall become a Participant effective as of the date of the first month's salary redirection, the provisions of which are specifically incorporated herein by reference. 2.3 APPLICATION TO PARTICIPATE An Employee who is eligible to participate in this Plan shall, during the applicable Election Period, complete an Election of Benefits and Salary Redirection Agreement form which the Administrator shall fumish to the Employee. The Participant's election should be for the Plan Year during which he wishes to participate in this Plan. Any such Salary Redirection Agreement shall be effective for the first pay period beginning on or after the Employee's effective date of participation pursuant to Section 2.2. The election and redirection made on such form shall be irrevocable until the end of the applicable Plan Year unless the Participant 7 0 is entitled to change his/her Benefit elections pursuant to Section 5.4 hereof. 2.4 TERMINATION OF PARTICIPATION A Participant shall no longer participate in this Plan upon the occurrence of any of the . following events: (a) His/her termination of employment, subject to the provisions of Section 2.6; (b) The end of the Plan Year during which he became a limited Participant because of a change in employment status pursuant to Section 2.5; (c) His/her death, subject to the provisions of Section 2.7; or (d) The termination of this Plan, subject to the provisions of Section 10.2. 2.5 CHANGE OF EMPLOYMENT STATUS If a Participant ceases to be an Eligible Employee because of a change in employment status or classification (other than through termination of employment), the Participant shall become a limited Participant in this Plan for the remainder of the Plan Year in which such change of employment status occurs. As a limited Participant, no further Salary Redirection may be made on behalf of the Participant, and, except as otherwise provided herein, all further Benefit elections shall cease, subject to the limited Participant's right to continue coverage under any Insurance Contracts. However, any balances in the limited Participant's Health Care Reimbursement Fund or Dependent Care Assistance Account may be used during such Plan Year to reimburse the limited Participant for any allowable Medical Expenses or Employment-Related Dependent Care Expenses incurred during the Plan Year. Subject to the provisions of Section 2.6, if the limited Participant later becomes an Eligible Employee, then the limited Participant may again become a full Participant in this Plan, provided he otherwise satisfies the participation requirements set forth in this Article 11 as if he or she were a new Employee and made an election in accordance with Section 5.1. 2.6 TERMINATION OF EMPLOYMENT If a Participant terminates employment with the Employer for any reason other than death, his/her participation in the Plan shall be governed in accordance with the following: (a) With regard to Benefits which are insured, the Participant's participation in the Plan shall cease, subject to the Participant's right to continue coverage under any Insurance Contract for which premiums have already been paid. (b) With regard to the Dependent Care Assistance Program, the Participant's participation in the Plan shall cease and no further Salary Redirection contributions shall be made. However, such Participant may submit claims for employment related Dependent Care Expense reimbursements for the remainder of the Plan Year in which such termination occurs, based • on the level of his/her Dependent Care Assistance Account as of his/her date of termination. (c) With regard to the Health Care Reimbursement Plan, the Participant's participation in the Plan shall cease and no further Salary Redirection contributions shall be made. However, such -Participant may submit claims for expenses incurred during the portion of the Plan Year preceding his/her date of termination. (d) In the event a Participant terminates his/her participation in the Health Care Reimbursement Plan during the Plan Year, if Salary Redirections are made other than on a pro rata basis, upon termination the Participant shall be entitled to a reimbursement for any Salary Redirection previously paid for coverage or benefits relating to the period after the date of the Participant's separation from service regardless of the Participant's claims or reimbursements as of such date. (e) This Section shall be applied and administered consistent with such further rights a Participant and his/her Dependents may acquire pursuant to Code Section 4980B and Section 11.14 of the Plan. 2.7 DEATH If a Participant dies, his/her participation in the Plan shall cease. However, such Participant's beneficiaries, or the representative of his/her estate, may submit claims for expenses or benefits for the remainder of the Plan Year or until the Cafeteria Plan Benefit Dollars allocated to each specific benefit are exhausted. A Participant may designate a specific beneficiary for this purpose. If no such beneficiary is specified, the Administrator may designate the Participant's Spouse, one of his/her Dependents or a representative of his/her estate. ARTICLE III CONTRIBUTIONS TO THE PLAN 3.1 SALARY REDIRECTION Benefits under the Plan shall be financed by Salary Redirections sufficient to support Benefits that a Participant has elected hereunder and to pay the Participant's Premium Expenses. The salary administration program of the Employer shall be revised to allow each Participant to agree to reduce his/her pay during a Plan Year by an amount determined necessary to purchase the elected Benefit. The amount of such Salary Redirection shall be specified in the Salary Redirection Agreement (or Salary Reduction Agreement) and shall be applicable for a Plan Year. Notwithstanding the above, for new Participants, the Salary Redirection Agreement shall only be applicable from the first day of the pay period following the Employee's entry date up to and including the last day of the Plan Year. These contributions shall be converted to Cafeteria Plan Benefit Dollars and allocated to the funds or accounts established under the Plan pursuant to the Participant's elections made under Article V. Any Salary Redirection shall be determined prior to the beginning of a Plan Year (subject to 9 0 initial elections pursuant to Section 5.1) and prior to the end of the Election Period and shall be irrevocable for such Plan Year. However, a Participant may revoke a Benefit election or a Salary Redirection Agreement after the Plan Year has commenced and make a new election and/or Salary Redirection Agreement with respect to the remainder of the Plan Year, if both the revocation and the new election are on account of and consistent with a change In family status and such other permitted events as determined under Article V of the Plan and consistent with the rules and regulations of the Department of the Treasury. Salary Redirection amounts shall be contributed on a pro rata basis for each pay period during the Plan Year. All individual Salary Redirection Agreements (or Salary Reduction Agreements) are deemed to be part of this Plan and incorporated by reference hereunder. 3.2 APPLICATION OF CONTRIBUTIONS As soon as reasonably practical after each payroll period, the Employer shall apply the Salary Redirection to provide the Benefits elected by the affected Participants. Any contributions made or withheld for the Health Care Reimbursement Fund or Dependent Care Assistance Account shall be forwarded to the Administrator to be credited to such fund or account. Amounts designated for the Participant's Premium Expense Reimbursement Account shall likewise be forwarded to the Administrator to be credited to such account for the purpose of paying Premium Expenses. 3.3 PERIODIC CONTRIBUTIONS Notwithstanding the requirement provided above and in other Articles of this Plan that Salary Redirections be contributed to the Plan by the Employer on behalf of an Employee on a level and pro rata basis for each payroll period, the Employer and Administrator may implement a procedure in which Salary Redirections are contributed throughout the Plan Year on a periodic basis that is not pro rata for each payroll period. However, with regard to the Health Care Reimbursement Plan, the payment schedule for the required contributions may not be based on the rate or amount of reimbursements during the Plan Year. In the event Salary Redirections are not made on a pro rata basis, upon termination of participation, a Participant may be entitled to a refund of such Salary Redirections pursuant to Section 2.6. ARTICLE IV f~ BENEFITS 4.1 BENEFIT OPTIONS Each Participant may elect to have the amount of his/her Cafeteria Plan Benefit Dollars applied to any one or more of the following optional Benefits (if selected by the employer as indicated by the Adoption Agreement and Summary Plan Description of the Plan): (1) Health Care Reimbursement Plan (2) Dependent Care Assistance Program 10 • (3) Insurance Premium Payment Plan (1) Health Insurance Benefit (ii) Dental Insurance Benefit (iii) Group-Term Life Insurance Benefit (iv) Disability and/or Accident Insurance Benefit (v) Vision Insurance Benefit (vi) Cancer Insurance (4) Cash Benefit • 4.2 HEALTH CARE REIMBURSEMENT PLAN BENEFIT Each Participant may elect coverage under the Health Care Reimbursement Plan option, in which case Article VI shall apply. 4.3 DEPENDENT CARE ASSISTANCE PROGRAM BENEFIT Each Participant may elect coverage under the Dependent Care Assistance Program option, in which case Article V11 shall apply. 4.4 HEALTH INSURANCE BENEFIT (a) Each Participant may elect to be covered under a health and hospitalization Insurance Contract for the Participant, his or her Spouse, and his or her Dependents. (b) The Employer may select suitable health and hospitalization Insurance Contracts for use in providing this health insurance benefit, which policies will provide uniform benefits for all Participants electing this Benefit. • (c) The rights and conditions with respect to the benefits payable from such health and hospitalization Insurance Contract shall be determined therefrom, and such Insurance Contract shall be incorporated herein by reference. 4.5 DENTAL INSURANCE BENEFIT (a) Each Participant may elect to be covered under the Employer's dental Insurance Contract. In addition, the Participant may elect either individual or family coverage under such Insurance Contract. (b) The Employer may select suitable dental Insurance Contracts for use in providing this 0 dental insurance benefit, which policies will provide uniform benefits for all Participants electing this Benefit. (c) The rights and conditions with respect to the benefits payable from such dental Insurance Contract shall be determined therefrom, and such dental Insurance Contract shall be incorporated herein by reference. 4.6 GROUP-TERM LIFE INSURANCE BENEFIT (a) Each Participant may elect to be covered by the Employer's group-term life Insurance Contract. However, the amount of coverage hereunder on behalf of any Participant may not exceed the lesser of 3 times such Participants Compensation or $50,000. (b) The Employer may select suitable group-term life Insurance Contracts for use in providing this group-term life insurance benefit, which policies will provide benefits for all Participants electing this benefit on a uniform basis. (c) The rights and conditions with respect to the benefits payable from such group-term life Insurance Contract shall be determined therefrom, and such group-term life Insurance Contract shall be incorporated herein by reference. 4.7 DISABILITY AND/OR ACCIDENT BENEFIT (a) Each Participant may elect to be covered by the Employer's Disability and/or Accident Insurance Contracts. (b) The Employer may select suitable Disability and/or Accident Insurance Contracts for use in providing this Disability and/or Accident Benefit. The Disability and/or Accident Insurance Contracts may provide for long-term or short-term coverage. (c) The rights and conditions with respect to the Benefits payable from such Disability and/or Accident Insurance Contract shall be determined therefrom, and such Disability and/or Accident Insurance Contract shall be incorporated herein by reference. 4.8 VISION INSURANCE BENEFIT (a) Each Participant may elect to be covered under the Employer's Vision Insurance Contract. In addition, the participant may elect either individual or family coverage. (b) The rights and conditions with respect to the benefits payable from such vision Insurance Contract shall be determined therefrom, and such Vision Insurance Contract shall be incorporated herein by reference. 4.9 CANCER INSURANCE POLICY (a) Each Participant may elect to be covered under the Employer's Cancer Insurance policy. In addition, the Participant may elect either individual or family coverage. 12 (b) The rights and conditions with respect to the benefits payable from such Cancer Insurance policy shall be determined therefrom, and such cancer insurance policy shall be incorporated herein by reference. 4.10 CASH BENEFIT If a Participant fails to make any election of Benefit options or does not elect any Salary Redirections, such Participant shall be deemed to have chosen the Cash Benefit as his/her sole Benefit option. 4.11 NONDISCRIMINATION REQUIREMENTS (a) It is the intent of this Plan to provide benefits to a classification of employees which the Secretary of the Treasury finds not to be discriminatory in favor of the group in whose favor discrimination may not occur under Code Section 125. • (b) It is the intent of this Plan not to provide qualified benefits as defined under Code Section 125 to Key Employees in amounts that exceed 25% of the aggregate of such Benefits provided for all Eligible Employees under the Plan. For purposes of the preceding sentence, qualified benefits shall not include benefits which (without regard to this paragraph) are includable in gross income. (c) If the Administrator deems it necessary to avoid discrimination or possible taxation to Key Employees or a group of employees in whose favor discrimination may not occur in violation of Code Section 125, It may, but shall not be required to, reject any election or reduce contributions or non-taxable Benefits in order to assure compliance with this Section. Any act taken by the Administrator under this Section shall be carried out In a uniform and nondiscriminatory manner. If the Administrator decides to reject any election or reduce contributions or non-taxable Benefits, it shall be done in the following manner. First, the non-taxable Benefits of the affected Participant (either an employee who is highly compensated or a Key Employee, whichever is applicable) who has elected the highest amount of non-taxable benefits will be reduced until the discrimination tests set forth in this Section are satisfied or until the amount of his/her non-taxable Benefits equals the non-taxable Benefits of the affected Participant who has elected the second highest amount of non-taxable Benefits. This process shall continue until the nondiscrimination tests set forth in this Section are satisfied. With respect to any affected Participant who has had Benefits reduced pursuant to this Section, the reduction shall be made proportionately among non-insured Benefits, and once all non-insured Benefits are expended, proportionately among insured Benefits. Contributions which are not utilized to provide Benefits to any Participant by virtue of any administrative act under this paragraph shall be forfeited and deposited into the benefit plan surplus. 13 • ARTICLE V PARTICIPANT ELECTIONS 5.1 INITIAL ELECTIONS An Employee who meets the eligibility requirements of Section 2.1 on the first day of, or during, a Plan Year may elect to participate in this Plan for all or the remainder of such Plan Year, provided he elects to do so before his/her effective date of participation pursuant to Section 2.2. However, if such Employee does not complete an Election of Benefits and Salary Redirection Agreement form and deliver it to the Administrator before such date, his/her Election Period shall extend 30 calendar days after such date, or for such further period as the Administrator shall determine and apply on a uniform and nondiscriminatory basis. However, any election during the extended 30-day election period pursuant to this Section 5.1 shall not be effective until the first pay period following the later of such Participant's effective date of participation pursuant to Section 2.2 or the date of the receipt of the election form by the Administrator, and shall be limited to the Benefit expenses incurred for the balance of the Plan Year for which the election is made. 5.2 SUBSEQUENT ANNUAL ELECTIONS During the Election Period prior to each subsequent Plan Year, each Participant shall be given the opportunity to elect, on an election of benefits form to be provided by the Administrator, which Benefit options he wishes to select and purchase with his/her Cafeteria Plan Benefit Dollars. Any such election shall be effective for any Benefit expenses incurred during the Plan Year which follows the end of the Election Period. With regard to Subsequent annual elections, the following options shall apply: (a) A Participant or Employee who failed to initially elect to participate may elect different or new Benefits under the plan during the Election Period; (b) A Participant may terminate his/her participation in the Plan by notifying the Administrator in writing during the Election Period that he does not want to participate in the plan for the next Plan Year, (c) An employee who elects not to participate for the Plan Year following the Election Period will have to wait until the next Election Period before again electing to participate in the Plan. 5.3 FAILURE TO ELECT Any Participant who fails to complete a new benefit election form pursuant to Section 5.2 by the end of the applicable Election Period shall be treated in the following manner: (a) With regard to Benefits available under the Plan that are non-insured and for which no Premium Expenses apply, such Participant shall be deemed to have elected not to participate in the Plan for the upcoming Plan Year. No further Salary Redirections shall therefore be authorized or made for the subsequent Plan Year for such non-insured Benefits. 14 9 01-00 • (b) With regard to Benefits available under the Plan that are Insured and for which Premium Expenses apply, such Participant shall be deemed to have made the same Benefit elections as are then in effect for the current Plan Year. The Participant shall also be deemed to have elected Salary Redirection in an amount necessary to purchase such insured Benefit options. 5.4 CHANGE OF ELECTIONS (a) Any election made under the Plan shall be irrevocable by the Participant during the Plan Year, except as provided in (b) or (c) below. (b) A Participant may revoke an election in writing for the balance of a Plan Year and, if desired, file a new election in writing if both the revocation and the new election are (1) consistent with the terms of the Dental, Disability and/or Accident, Group Life Insurance, or Health Plan in question and (2) made on account of and consistent with a change in family • status. For this purpose, a change in family status includes the marriage or divorce of the Participant, the death of the Participant's spouse or a dependent, the birth or adoption of a child of the Participant, the termination or commencement of employment of the Participant's spouse, the switching from part-time to full-time employment status (or vice versa) by the Participant or the Participant's spouse, the taking of an unpaid leave of absence by the Participant or the Participant's spouse, a significant change in the health coverage of the Participant or the Participant's spouse attributable to the spouse's employment, and such other events that the Administrator determines will permit a change or revocation of an election (and, if applicable, the filing of a new election) during a Plan Year under regulations and rulings of the Intemal Revenue Service. (c) In the case of coverage under the Dental Plan or a Medical/Health Plan which is provided by an independent third party provider, if (1) the Participants' share of the cost of such coverage significantly increases as a result of a significant cost increase by the independent third-party provider, or (2) such coverage ceases or is significantly curtailed, the Administrator may permit all Participants electing such coverage for the Plan Year to revoke their elections for • the balance of the Plan Year, provided that similar coverage is elected under the DenfalPlan or a Medical/Health Plan for the balance of the Plan Year. (d) Any revocation and new election under this Section 5.4 shall be effective at such time as the Administrator shall prescribe, but not earlier than the first pay period beginning after the revocation and new election. 15 0 ARTICLE VI HEALTH CARE REIMBURSEMENT PLAN 6.1 ESTABLISHMENT OF PLAN This Health Care Reimbursement Plan is intended to qualify as a medical reimbursement plan under Code Section 105 and shall be interpreted in a manner consistent with such Code Section and the Treasury regulations thereunder. Participants who elect to participate in this Health Care Reimbursement Plan may submit claims for the reimbursement of Medical Expenses. All amounts reimbursed under this Health Care Reimbursement Plan shall be periodically paid from amounts allocated to the Health Care Reimbursement Fund. Periodic payments reimbursing Participants from the Health Care Reimbursement Fund shall in no event occur less frequently than monthly. 6.2 DEFINITIONS For the purposes of this Article and the Cafeteria Plan, the terms below have the following meaning: (a) "Health Care Reimbursement Fund" means the fund established for Participants pursuant to this Plan to which part of their Cafeteria Plan Benefit Dollars may be allocated and from which all allowable Medical Expenses may be reimbursed. (b) "Health Care Reimbursement Plan" means the plan of benefits contained in this Article, which provides for the reimbursement of eligible Medical Expenses incurred by a Participant or his/her Dependents. (c) "Highly Compensated Participant" means, for the purposes of this Article and determining discrimination under Code Section 105(h), a participant who is: (1) one of the 5 highest paid officers; (2) a shareholder who owns (or is considered to own applying the rules of Code Section 318) more than 10 percent in value of the stock of the Employer, or (3) among the highest paid 25 percent of all Employees (other than exclusions permitted byCodeSection 105(h)(3)(B) for those individuals whoare not Participants). (d) "Medical Expenses" means any expense for medical care within the meaning of the term "medical care" or "medical expense" as defined in Code Section 213 and the rulings and Treasury regulations thereunder, and not otherwise used by the Participant as a deduction in determining his/her tax liability under the Code. However, a Participant may not be reimbursed for the cost of other health coverage such as premiums paid under plans maintained by the Employer of the Participant's spouse or individual policies maintained by the Participant or his/her spouse or Dependent. 16 (e) The definitions of Article I are hereby incorporated by reference to the extent necessary to interpret and apply the provisions of this Health Care Reimbursement Plan. 6.3 FORFEITURES The amount in the Health Care Reimbursement Fund as of the end of any Plan Year (and after the processing of all claims for such Plan Year pursuant to Section 6.7 hereof) shall be forfeited and credited to the benefit plan surplus. In such event, the Participant shall have no further claim to such amount for any reason, subject to Section 8.2. 6.4 LIMITATION ON ALLOCATIONS Notwithstanding any provision contained in this Health Care Reimbursement Plan to the contrary, no more than $4,000.00 may be allocated to the Health Care Reimbursement Fund by a Participant in or on account of any Plan Year. is 6.5 NONDISCRIMINATION REQUIREMENTS (a) It is the intent of this Health Care Reimbursement Plan not to discriminate in violation of the Code and the Treasury regulations thereunder. (b) If the Administrator deems it necessary to avoid discrimination under this Health Care Reimbursement Plan, it may, but shall not be required to, reject any elections or reduce contributions or Benefits In order to assure compliance with this Section. Any act taken by the Administrator under this Section shall be carried out in a uniform and nondiscriminatory manner. If the Administrator decides to reject any elections or reduce contributions or Benefits, it shall be done in the following manner. First, the Benefits designated for the Health Care Reimbursement Fund by the member of the group in whose favor discrimination may not occur pursuant to Code Sections 105 or 125 that elected to contribute the highest amount to the fund for the Plan Year shall be reduced until the nondiscrimination tests set forth in this Section or the Code are satisfied, or until the amount designated for the fund equals the amount designated for the fund by the next member of the group in whose favor discrimination may not occur pursuant to Code Sections 105 or 125 who has elected the second highest contribution to the Health Care Reimbursement Fund for the Plan Year. This • process shall continue until the nondiscrimination tests set forth in this Section or the Code are satisfied. Contributions which are not utilized to provide Benefits to any Participant by virtue of any administrative act under this paragraph shall be forfeited and credited to the benefit plan surplus. 6.6 COORDINATION WITH CAFETERIA PLAN All Participants under the Cafeteria Plan are eligible to receive Benefits under this Health Care Reimbursement Plan. The enrollment under the Cafeteria Plan shall constitute enrollment under this Health Care Reimbursement Plan. In addition, other matters concerning contributions, elections and the like shall be governed by the general provisions of the Cafeteria Plan. 17 got, 0 6.7 HEALTH CARE REIMBURSEMENT PLAN CLAIMS (a) Ail Medical Expenses incurred by a Participant shall be reimbursed during the Plan Year subject to 2.6, even though the submission of such a claim occurs after his/her participation hereunder ceases; but provided that the Medical Expenses were incurred during the applicable Plan Year. (b) The Administrator shall direct the reimbursement to each eligible Participant for all allowable Medical Expenses, up to a maximum of the amount designated by the Participant for the Health Care Reimbursement Fund for the Plan Year. Reimbursements shall be made available to the Participant throughout the Plan Year without regard to the level of Cafeteria Plan Benefit Dollars which have been allocated to the fund at any given point in time. Furthermore, a Participant shalt be entitled to reimbursements only for amounts in excess of any payments or other reimbursements under any health care plan covering the Participant and/or his/her Spouse or Dependents. (c) Claims for the reimbursement of Medical Expenses incurred in any Plan Year shall be paid as soon after a claim has been filed as is administratively practicable; provided however, that if a Participant fails to submit a claim within the 90 day period immediately following the end of the Plan Year, those Medical Expense claims shall not be considered for reimbursement by the Administrator. (d) Reimbursement payments under this Plan shall be made directly to the Participant. However, at the discretion of the Participant and Administrator, payments may be made directly to the service provider. The application for payment or reimbursement shall be made to the Administrator on an acceptable form within a reasonable time of incurring the debt or paying for the service. The application shall include a written statement from an independent third party stating that the Medical Expense has been incurred and the amount of such expense. Furthermore, the Participant shall provide a written statement that the Medical Expense has not been reimbursed or is not reimbursable under any other health plan coverage and, if reimbursed from the Health Care Reimbursement Fund, such amount will not be claimed as a tax deduction. The Administrator shall retain a file of all such applications. ARTICLE VII DEPENDENT CARE ASSISTANCE PROGRAM 7.1 ESTABLISHMENT OF PROGRAM This Dependent Care Assistance Program is intended to qualify as a program under Code Section 129 and shall be interpreted in a manner consistent with such Code Section. Participants who elect to participate in this program may submit claims for the reimbursement of Employment-Related Dependent Care Expenses. All amounts reimbursed under this Dependent Care Assistance Program shall be paid from amounts allocated to the Participant's Dependent Care Assistance Account. 18 • 7.2 DEFINITIONS For the purposes of this Article and the Cafeteria Plan the terms below shall have the following meaning: (a) "Dependent Care Assistance Account" means the account established for a Participant pursuant to this Article to which part of his/her Cafeteria Plan Benefit Dollars may be allocated and from which Employment-Related Dependent Care Expenses of the Participant may be reimbursed. (b) "Dependent Care Assistance Program" means the program of benefits contained in this Article, which provides for the reimbursement of eligible expenses for the care of the Qualifying Dependents of Participants. (c) "Earned Income" means earned income as defined under Code Section 32(c)(2), but • excluding such amounts paid or incurred by the Employer for dependent care assistance to the Participant. (d) "Employment-Related Dependent Care Expenses" means the amounts paid for expenses of a Participant for those services which if paid by the Participant would be considered employment related expenses under Code Section 21(b)(2). Generally, they shall include expenses for household services or for the care of a Qualifying Dependent, to the extent that such expenses are incurred to enable the Participant to be gainfully employed for any period for which there are one or more Qualifying Dependents with respect to such Participant. The determination of whether an amount qualifies as an Employment-Related Dependent Care Expense shall be made subject to the following rules: (1) If such amounts are paid for expenses incurred outside the Participant's household, they shall constitute Employment-Related Dependent Care Expenses only if incurred for a Qualifying Dependent as defined in Section 7.2(f)(1) (or deemed to be, as described in Section 7.2(f)(1) pursuant to Section 7.2(f)(3)), or for a Qualifying Dependent as defined in Section 7.2(f)(2) (or deemed to be, as described in Section 7.2(f)(2) pursuant to Section 7.2(f)(3)) who regularly spends at least 8 hours per day in the Participant's household; (2) If the expense is incurred outside the Participant's home at a facility that provides care for a fee, payment, or grant for more than 6 individuals who do not regularly reside at the facility, the facility must comply with all applicable state and local laws and regulations, including licensing requirements, if any; and (3) Employment-Related Dependent Care Expenses of Participant shall not include amounts paid or incurred to a child of such Participant who is under the age of 19 or to an individual who is a dependent of such Participant or such Participant's Spouse. (e) "Highly Compensated Employee" means an Employee who is a highly compensated employee within the meaning of Code Section 414(q) and the Treasury regulations thereunder. 19 u (f) "Qualifying Dependent" means, for Dependent Care Assistance Program purposes, (1) a Dependent of a Participant who is under the age of 13, with respect to whom the Participant is entitled to an exemption under Code Section 129(c); (2) a Dependent or the Spouse of a Participant who is physically or mentally incapable of caring for himself or herself; or (3) a child that is deemed to be a Qualifying Dependent described in paragraph (1) or (2) above, whichever is appropriate, pursuant to Code Section 21(ex5). (g) The definitions of Article I are hereby incorporated by reference to the extent necessary to Interpret and apply the provisions of this Dependent Care Assistance Program. 7.3 DEPENDENT CARE ASSISTANCE ACCOUNTS The Administrator shall establish a Dependent Care Assistance Account for each Participant who elects to apply Cafeteria Plan Benefit Dollars to Dependent Care Assistance Program benefits. 7.4 INCREASES IN DEPENDENT CARE ASSISTANCE ACCOUNTS A Participant's Dependent Care Assistance Account shall be increased each pay period by the portion of Cafeteria Plan Benefit Dollars that he/she has elected to apply toward his/her Dependent Care Assistance Account pursuant to elections made under Article V hereof. 7.5 DECREASES IN DEPENDENT CARE ASSISTANCE ACCOUNTS A Participant's Dependent Care Assistance Account shall be reduced by the amount of any Employment-Related Dependent Care Expense reimbursements paid or incurred on behalf of a Participant pursuant to Section 7.12 hereof. 7.6 ALLOWABLE DEPENDENT CARE ASSISTANCE REIMBURSEMENT Subject to limitations contained in Section 7.9 of this Program, and to the extent of the amount contained in the Participant's Dependent Care Assistance Account, a Participant who incurs Employment-Related Dependent Care Expenses shall be entitled to receive from the Employer full reimbursement for the entire amount of such expenses incurred during the Plan Year or portion thereof during which he/she is a Participant. 7.7 ANNUAL STATEMENT OF BENEFITS On or before January 31st of each calendar year, the Employer shall furnish to each Employee who was a Participant and received benefits under Section 7.6 during the prior 20 • calendar year, a statement of all such benefits paid to or on behalf of such Participant during the prior calendar year. 7.8 FORFEITURES The Amount in a Participant's Dependent Care Assistance Account as of the end of any Plan Year (and after the processing of all claims for such Plan Year pursuant to Section 7.12 hereof) shall be forfeited and credited to the benefit plan surplus. In such event, the Participant shall have no further claim to such amount for any reason. 7.9 LIMITATION ON PAYMENTS Notwithstanding any provision contained in this Article to the contrary, amounts paid from a Participant's Dependent Care Assistance Account in or on account of any taxable year of the Participant shall not exceed the lesser of the Earned Income limitation described in Code • Section 129(b) or $5,000 ($2,500 if a separate tax return is filed by a Participant who is married as determined under the rules of paragraphs (3) and (4) of Code Section 21(e)). 7.10 NONDISCRIMINATION REQUIREMENTS (a) It is the intent of this Dependent Care Assistance Program that contributions or benefits not discriminate in favor of Highly Compensated Employees or their Dependents, as prohibited by Code Section 129(d). (b) It is the intent of this Dependent Care Assistance Program that not more than 25 percent of the amounts paid by the Employer for dependent care assistance during the Plan Year will be provided for the class of individuals who are shareholders or owners (or their Spouses or Dependents), each of whom (on any day of the Plan Year) owns more than 5 percent of the stock or of the capital or profits interest in the Employer. (c) If the Administrator deems it necessary to avoid discrimination or possible taxation to Highly Compensated Employees defined under Section 7.2(e) or to principal shareholders or owners as set forth in this Section, it may, but shall not be required to, reject any election or reduce contributions or non-taxable benefits in order to assure compliance with this Section. • Any act taken by the Administrator under this Section shall be carried out In a uniform and nondiscriminatory manner. If the Administrator decides to reject any elections or reduce contributions or Benefits, it shall be done in the following manner. First, the Benefits designated for the Dependent Care Assistance Account by the Highly Compensated Employee that elected to contribute the highest amount to such account for the Plan Year shall be reduced until the nondiscrimination tests set forth in this Section are satisfied, or until the amount designated for the account equals the amount designated for the account of the Highly Compensated Employee who has elected the second highest contribution to the Dependent Care Assistance Account for the Plan Year. This process shall continue until the nondiscrimination tests set forth in this Section are satisfied. Contributions which are not utilized to provide Benefits to any Participant by virtue of any administrative act under this paragraph shall be forfeited. 21 z, ao7 c3l ~J 7.11 COORDINATION WITH CAFETERIA PLAN All Participants under the Cafeteria Plan are eligible to receive benefits under this Dependent Care Assistance Program. The enrollment and termination of participation under the Cafeteria Plan shall constitute enrollment and termination of participation under this Dependent Care Assistance Program. In addition, other matters concerning contributions, elections and the like shall be governed by the general provisions of the Cafeteria Plan. 7.12 DEPENDENT CARE ASSISTANCE PROGRAM CLAIMS The Administrator shall direct the payment of all such Dependent Care Assistance claims to the Participant upon the presentation to the Administrator of documentation of such expenses in a form satisfactory to the Administrator. However, at the discretion of the Administrator and the Participant, payments may be made directly to the service provider. In its discretion in administering the Plan, the Administrator may utilize forms and require documentation of costs as may be necessary to verify the claims submitted. At a minimum, the form shall include a statement from an independent third party as proof that the expense has been incurred and the amount of such expense. In addition, the Administrator may require that each Participant who desires to receive reimbursement under this Program for Employment-Related Dependent Care Expenses submit a statement which may contain some or all of the following information: (a) The Dependent or Dependents for whom the services were performed; (b) The nature of the services performed for the Participant, the cost of which he/she wishes reimbursement; (c) The relationship, if any, of the person performing the services to the Participant; (d) If the services are being performed by a child of the Participant, the age of the child; (e) A statement as to where the services were performed; (f) If any of the services were performed outside the home, a statement as to whether the Dependent for whom such services were performed spends at least 8 hours a day in the Participant's household; (g) If the services were being performed in a day care center; a statement (1) that the day care center complies with all applicable laws and regulations du state of residence, (2) that the day care center provides care for more than 6 individual (other tsn individuals residing at the center), and (3) of the amount of fee paid to the provider. 22 • (h) If the Participant is married, a statement containing the following: (1) the Spouse's salary or wages if he or she is employed, or (2) if the Participant's Spouse is not employed, that (i) he or she is incapacitated, or (ii) he or she is a full-time student attending an educational institution and the months during the year which he or she attended such institution. Q) If a Participant fails to submit a claim within the 90 day period immediately following the end of the Plan Year, those claims shall not be considered for reimbursement by the Administrator. • ARTICLE VIII ERISA PROVISIONS 8.1 CLAIM FOR BENEFITS (a) Any claim for Benefits underwritten by an Insurance Contract shall be made to the Insurer. If the Insurer denies any claim, the Participant or beneficiary shall follow the Insurers claims review procedure. Any other claim for Benefits shall be made to the Administrator. If the Administrator denies a claim, the Administrator may provide notice to the Participant or beneficiary, in writing, within 90 days after the claim is filed unless special circumstances require an extension of time for processing the claim. If the Administrator does not notify the Participant of the denial of the claim within the 90 day period specked above, then the claim shall be deemed denied. The notice of a denial of a claim shall be written in a manner calculated to be understood by the claimant and shall set forth: (1) specific references to the pertinent Plan provisions on which the denial i s based; 40 (2) a description of any additional material or information necessary for the claimant to perfect the claim and an explanation as to why such information i s necessary; and (3) an explanation of the Plan's claim procedure. (b) Within 60 days after receipt of the above material, the claimant shall have a reasonable opportunity to appeal the claim denial to the Administrator for a full and fair review. The claimant or his/her duly authorized representative may: (1) request a review upon written notice to the Administrator; 23 a.a 0 (2) review pertinent documents; and (3) submit issues and comments in writing. (c) A decision on the review by the Administrator will be made not later than 60 days after receipt of a request for review, unless special circumstances require an extension of time for processing (such as the need to hold a hearing), in which event a decision should be rendered as soon as possible, but in no event later than 120 days after such receipt. The decision of the Administrator shall be written and shall include specific reasons for the decision, written in a manner calculated to be understood by the claimant, with specific references to the pertinent Plan provisions on which the decision is based. (d) Any balance remaining in the Participants' Health Care Reimbursement Fund or Dependent Care Assistance Account as of the end of each Plan Year shall be forfeited and deposited in the benefit plan surplus of the Employer pursuant to Section 6.3 or Section 7.8, whichever is applicable, unless the Participant had made a claim for such Plan Year, in writing, which has been denied or is pending; in which event the amount of the claim shall be held in his/her account until the claim appeal procedures set forth above have been satisfied or the claim is paid. If any such claim is denied on appeal, the amount held beyond the end of the Plan Year shall be forfeited and credited to the benefit plan surplus. 8.2 APPLICATION OF BENEFIT PLAN SURPLUS Any forfeited amounts credited to the' benefit plan surplus by virtue of the failure of a Participant to incur a qualified expense or seek reimbursement in a timely manner may, but need not be, separately accounted for after the close of the Plan Year (or after such further time specified herein for the filing of claim) in which such forfeitures arose. In no event shall such amounts be carried over to reimburse a Participant for expenses incurred during a subsequent Plan Year for the same or any other Benefit available under the Plan; nor shall amounts forfeited by a particular Participant be made available to such Participant in any other form or manner, except as permitted by Treasury regulations. Amounts In the benefit plan surplus shall be returned to the employer as soon as administratively feasible. 8.3 NAMED FIDUCIARY The Administrator shall be the named fiduciary pursuant to ERISA Section 402 and shall be responsible for the management and control of the operation and administration of the Plan. 8.4 GENERAL FIDUCIARY RESPONSIBILITIES The Administrator and any other fiduciary under ERISA shall discharge their duties with respect to this Plan solely in the interest of the Participants and their beneficiaries and: (a) for the exclusive purpose of providing Benefits to Participants and their beneficiaries and defraying reasonable expenses of administering the Plan; 24 • (b) with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims; and (c) in accordance with the documents and instruments governing the Plan insofar as such documents and instruments are consistent with ERISA. 8.5 NON-ASSIGNABILITY OF RIGHTS The right of any Participant to receive any reimbursement under the Plan shall not be alienable by the Participant by assignment or any other method, and shall not be subject to the rights of creditors, and any attempt to cause such right to be so subjected shall not be recognized, except to such extent as may be required by law. ARTICLE IX • ADMINISTRATION 9.1 PLAN ADMINISTRATION The operation of the Plan shall be under the supervision of the Administrator. It shall be a principal duty of the Administrator to see that the Plan is carried out in accordance with its terms, and for the exclusive benefit of Employees entitled to participate in the Plan. The Administrator shall have full discretionary power to administer the Plan in all of its details, subject, however, to the pertinent provisions of the Code. The Administrator's powers shall include, but shall not be limited to the following authority, in addition to all other powers provided by this Plan: (a) To make and enforce such rules and regulations as the Administrator deems necessary or proper for the efficient administration of the Plan; (b) To interpret the Plan, the Administrators interpretations thereof in good faith to be final and conclusive on all persons claiming benefits under the Plan; (c) To decide all questions concerning the Plan and the eligibility of any person to participate • in the Plan and to receive benefits provided under the Plan; (d) To reject elections or to limit contributions or Benefits for certain highly compensated participants if it deems such to be desirable in order to avoid discrimination under the Plan in violation of applicable provisions of the Code; (e) To provide Employees with a reasonable notification of their benefits available under the Plan; (f) To approve reimbursement requests and to authorize the payment of benefits; and (g) To appoint such agents, counsel, accountants, consultants, and actuaries as may be 25 Cqu is required to assist in administering the Plan. Any procedure, discretionary act, interpretation or construction taken by the Administrator shall be done in a nondiscriminatory manner based upon uniform principles consistently applied and shall be consistent with the intent that the Plan shall continue to comply with the terms of Code Section 125 and the Treasury regulations thereunder. 9.2 EXAMINATION OF RECORDS The Administrator shall make available to each Participant, Eligible Employee and any other Employee of the Employer such records as pertain to their interest under the Plan for examination at reasonable times during normal business hours. 9.3 PAYMENT OF EXPENSES Any reasonable administrative expenses shall be paid by the Employer unless the Employer determines that administrative costs shall be bome by the Participants under the Plan or by any Trust Fund which may be established hereunder. The Administrator may impose reasonable conditions for payments, provided that such conditions shall not discriminate in favor of Highly Compensated Employees. 9.4 INSURANCE CONTROL CLAUSE In the event of a conflict between the terms of this Plan and the terms of an Insurance Contract of a particular Insurer whose product is then being used in conjunction with this Plan, the terms of the Insurance Contract shall control as to those Participants receiving coverage under such Insurance Contract. For this purpose, the Insurance Contract shall control in defining the persons eligible for insurance, the dates of their eligibility, the conditions which must be satisfied to become insured, if any, the benefits Participants are entitled to and the circumstances under which insurance terminates. 9.5 INDEMNIFICATION OF ADMINISTRATOR The Employer agrees to indemnify and to defend to the fullest extent permitted by law any Employee serving as the Administrator or as a member of a committee designated as Administrator (including any Employee or former Employee who previously served as Administrator or as a member of such committee) against all liabilities, damages, costs and expenses (including attorney's fees and amounts paid in settlement of any claims approved by the Employer) occasioned by any act or omission to act in connection with the Plan, if such act or omission is in good faith. 26 • ARTICLE X AMENDMENT OR TERMINATION OF PLAN 10.1 AMENDMENT The Employer, at any time or from time to time, may amend any or all of the provisions of the Plan without the consent of any Employee or Participant. No amendment shall have the effect of modifying any benefit election of any Participant In effect at the time of such amendment, unless such amendment is made to comply with Federal, state or local laws, statutes or regulations. 10.2 TERMINATION The Employer is establishing this Plan with the intent that it will be maintained for an indefinite period of time. Notwithstanding the foregoing, the Employer reserves the right to terminate the Plan, in whole or in part, at any time. In the event the Plan is terminated, no further • contributions shall be made. Benefits under any Insurance Contract shall be paid in accordance with the terms of the Contract. No further additions shall be made to the Health Care Reimbursement Fund or Dependent Care Assistance Account, but all payments from such fund shall continue to be made according to the elections in effect until the end of the Plan Year in which the Plan termination occurs (and for a reasonable period of time thereafter, if required for the filing of claims), or until the balances of all accounts have been reduced to zero, whichever occurs first. Any amounts remaining in any such fund or account as of the end of the Plan Year in which Plan termination occurs shall be forfeited and deposited in the benefit plan surplus after the expiration of the filing period. ARTICLE XI MISCELLANEOUS 11.1 PLAN INTERPRETATION All provisions of this Plan shall be interpreted and applied in a uniform, nondiscriminatory manner. This Plan shall be read in its entirety and not severed except as provided in Section • 11.12. 11.2 GENDER AND NUMBER Whenever any words are used herein the masculine, feminine or neuter gender, they shall be construed as though they were also used in another gender in all cases where they would so apply, and whenever any words are used herein the singular or plural form, they shall be construed as though they were also used in the other form in all cases where they would so apply. 27 9 11.3 WRITTEN DOCUMENT This Plan, in conjunction with any separate written document which may be required by law, is intended to satisfy the written Plan requirement of Code Section 125 and any Regulations thereunder relating to cafeteria plans. 11.4 EXCLUSIVE BENEFIT This Plan shall be maintained for the exclusive benefit of the Employees who participate in the Plan. 11.5 PARTICIPANT'S RIGHTS This Plan shall not be deemed to constitute an employment contract between the Employer and any Participant or to be a consideration or an inducement for the employment of any Participant or Employee. Nothing contained in this Plan shall be deemed to give any Participant or Employee the right to be retained in the service of the Employer or to interfere with the right of the Employer to discharge any Participant or Employee at any time regardless of the effect which such discharge shall have upon him as a Participant of this Plan. 11.6 ACTION BY THE EMPLOYER Whenever the Employer under the terms of the Plan is permitted or required to do or perform any act or matter or thing, it shall be done and performed by a person duly authorized by its legally constituted authority. 11.7 EMPLOYER'S PROTECTIVE CLAUSES (a) Upon the failure of either the Participant or the Employer to obtain the insurance contemplated by this Plan (whether as a result of negligence, gross neglect or otherwise), the Participant's Benefits shall be limited to the insurance premium, if any, that remained unpaid for the period in question and the actual insurance proceeds, if any, received by the Employer or the Participant as a result of the Participant's claim. (b) The Employer's liability to the Participant shall only extend to and shall be limited to any payment actually received by the Employer from the Insurer. In the event that the full insurance Benefit contemplated is not promptly received by the Employer within a reasonable time after submission of a claim, then the Employer shall notify the Participant of such facts and the Employer shall no longer have any legal obligation whatsoever (except to execute any document called for by a settlement reached by the Participant). The Participant shall be free to settle, compromise or refuse to pursue the claim as the Participant, in his/her sole discretion, shall see fit. (c) The Employer shall not be responsible for the validity of any Insurance Contract issued hereunder or for the failure on the part of the Insurer to make payments provided for under any Insurance Contract, or for the action of any person which may delay or render null and 28 woo • void or unenforceable, in whole or in part, an Insurance Contract. With regard to this paragraph, the following shall apply: (1) Once insurance is applied for or obtained, the Employer shall not be liable for any loss which may result from the failure to pay Premiums to the extent Premium notices are not received by the Employer. (2) To the extent Premium notices are received by the Employer, the Employers liability for the payment of such Premiums shall be limited to the amount of such Premiums and shall not include liability for any other loss which may result from failure to pay such Premiums. (3) The Employer shall not be liable for the payment of any insurance Premium or any loss which may result from the failure to pay an insurance Premium if the Benefits available under this Plan are insufficient to provide for the amount of such Premium cost at the time it • is due. In such circumstances the Participant shall be responsible for and see to the payment of such Premiums. The Employer shall undertake to notify a Participant if available Benefits under this Plan are insufficient to provide for an insurance Premium but shall not be liable for any failure to make such notification. 11.8 NO GUARANTEE OF TAX CONSEQUENCES Neither the Administrator nor the Employer makes any commitment or guarantee that any amounts paid to or for the benefit of a Participant under the Plan will be excludable from the Participant's gross income for federal or state income tax purposes, or that any other federal or state tax treatment will apply to or be available to any Participant. It shall be the obligation of each Participant to determine whether each payment under the Plan is excludable from the Participant's gross income for federal and state income tax purposes, and to notify the Employer if the Participant has reason to believe that any such payment is not so excludable. Notwithstanding the foregoing, the rights of Participants under this Plan shall be legally enforceable. • 11.9 INDEMNIFICATION OF EMPLOYER BY PARTICIPANTS If any Participant receives one or more payments or reimbursements under the Plan that are not for a permitted Benefit, such Participant shall indemnify and reimburse the Employer for any liability it may incur for failure to withhold federal or state income tax or Social Security tax from such payments or reimbursements. However, such indemnification and reimbursement shall not exceed the amount of additional federal and state income tax (plus any penalties) that the Participant would have owed if the payments or reimbursements had been made to the Participant as regular cash compensation, plus the Participant's share of any Social Security tax that would have been paid on such compensation, less any such additional income and Social Security tax actually paid by the Participant. 29 its. i ~ ~~~+i= rt..'a,~fF.TTC 11.10 FUNDING Unless otherwise required by law, contributions to the Plan may, but need not be, placed in trust or dedicated to a specific Benefit, and can be considered general assets of the Employer. Furthermore, and unless otherwise required by law, nothing herein shall be construed to require the Employer or the Administrator to maintain any fund or segregate any amount for the benefit of any Participant, and no Participant or other person shall have any claim against, right to, or security or other interest in, any fund, account or asset of the Employer from which any payment under the Plan may be made. 11.11 GOVERNING LAW This Plan is governed by the Code and the Treasury regulations issued thereunder (as they might be amended from time to time). In no event shall the Employer guarantee the favorable tax treatment sought by this Plan. To the extent not preempted by Federal law, the provisions of this Plan shall be construed, enforced and administered according to the laws of the State of Texas. 11.12 SEVERABILITY If any provision of the Plan is held invalid or unenforceable, its invalidity or unenforceability shall not affect any other provisions of the Plan, and the Plan shall be construed and enforced as if such provision had not been included herein. 11.13 CAPTIONS The captions contained herein are inserted only as a matter of convenience and for reference, and in no way define, limit, enlarge or describe the scope or intent of the Plan, nor in any way shall affect the Plan or the construction of any provision thereof. 11.14 CONTINUATION OF COVERAGE Notwithstanding anything in the Plan to the contrary, in the event any benefit under this Plan subject to the continuation coverage requirement of CodeSection 4980B becomes unavailable, each Participant will be entitled to continuation coverage as prescribed in Code Section 4980B. 11.15 FMLA LEAVE If the Participant makes contributions to this plan, and the Participant takes an unpaid FMLA leave, the Participant may revoke an existing election of coverage for the remaining portion of the applicable Coverage Period. Upon return from FMLA Leave, the Participant may elect to have such coverage reinstated. If the Participant elects to continue such coverage during the FMLA leave, the Participant may elect to pay the amount required during the FLMA leave either (1) in one lump sum pre-tax payment in advance of the commencement of the FMLA leave, or (ii) during the term of the FMLA leave on the same schedule as payments would be made if the Participant were not on leave. The Participant will make payments from his personal assets through a means other than payroll deduction and an amount equal to such payments will be credited to his Salary Reduction Election(s) in accordance with the terms of this Plan and all associated provisions of the Plan. 11.16 USERRA LEAVE In the event a Participant takes an unpaid USERRA leave of absence, each elected health care benefit shall continue for the lesser of the period of the 30 s~ leave or eighteen months (18), provided that applicable contributions, if any are required, for such benefits are timely paid by the Participant. The Participant may elect to pay the contributions on an after-tax basis as due, or on a pre-tax basis prior to commencing the leave. Upon return from an unpaid USERRA leave before the end of the Plan Year in which the leave commenced active participation in the Plan shall be reinstated and Salary Reduction contributions, if any, and benefits shall resume in accordance with the Participant's elections immediately prior to the leave. Upon return from an unpaid USERRA leave after the end of the Plan Year the Participant shall be treated as a newly Eligible Employee and Section 2.1 shall apply. If a Participant does not return to active employment at the conclusion of an unpaid USERRA leave, the Participant shall no longer be considered an Eligible Employee. NOTE: Section 11.15 and 11.16 are required by the Family Medical Leave Act of 1993 and the Uniformed Services employment and Reemployment Rights Act of 1994. Both these laws is require employers to continue certain health care coverages for period of unpaid leaves of absence. An employer must allow an employee to make contributions, If any are required, either on a pre-tax basis in one lump sum before the leave commences or on a month to month after-tax basis. IN WITNESS WHEREOF, this Plan document is hereby executed this day of 2002. Brazos County Signature: 31 is Ben Sanford & Associates, Inc. Telecommunications Consulting December 10, 2002 Wayne Dickey, Jail Administrator Brazos County Sheriff's Office 300 E. 26" St., Suite 105 Bryan, Texas 77803 Dear Wayne: Thank you for the opportunity to submit our proposal to provide a telecommunications billing audit for Brazos County. The proposed review covers all billing and commissions for the inmate telephone service provided by Evercom Systems, Inc. Ben Sanford & Associates, Inc. is an established telecommunications consulting firm that brings over twenty years of experience to the audit process. We maintain an extensive library of current and vintage tariffs as well as computer-assisted database access and analysis programs. If you wish to go ahead with the audit, please complete and sign the enclosed Agreement, type the enclosed letter of agency on county letterhead, and send them to me with the available telephone billing reports plus any contracts with Evercom. We will order any needed additional records or information from Evercom directly. I am looking forward to working with you and Brazos County on another successful project. Sincerely, Ben Sanford 1150 N. LOOP 1604 W., SUITE 108-615 • SAN ANTONIO, TEXAS 78248-4504 (210) 366-0405 • FAX (210) 492-3228 • TABLE OF CONTENTS I. II. M. IV. V. VII. Project Objectives 1 Procedure and Scope of Work 1 Personnel 2 Society of Telecommunications Consultants........ 3 References 4 Agreement 7 BRAZOS COUNTY R*AATE AUDIT PROPOSAL 121001doe • - • I. PROJECT OBJECTIVES 1. Confirm that Brazos County is receiving proper compensation for irunate telecom- munications services. 2. Confirm that Brazos County has not been underpaid in the past for such services. Ensure that Brazos County is not paying for extraneous or non-existent items. 4. Note billing/compensation convections needed. 5. Investigate regulatory issues, if any. 6. Provide a full reporting to Brazos County. H. PROCEDURE AND SCOPE OF WORK Ben Sanford & Associates, Inc. (BSA) will perform a review and contract analysis of current and prior commissions for inmate telecommunication services received by Brazos County. BSA will review Brazos County-provided vendor contracts and billing reports as well as other pertinent records obtained directly from the vendor, thus lowering client time required. We will examine all billing records for obvious errors and possible areas for likely mistakes. Certain larger records will have key information condensed and entered into databases for further analysis, as needed. Discussions concerning preliminary findings will then be held with appropriate Brazos County personnel. Depending on issues involved and information obtained, other Brazos County personnel, Evercom customers, and outside experts may be contacted in order to discuss questionable areas. BSA will identify any underpayments and file a comprehensive claim with Evercom and/or their partners who provide these services. The vendors will be required to correct any current errors as well as refund past underpayments. Resistance on their part to some items is possible, and they may attempt to limit the amount of refunds. On behalf of Brazos County, we will negotiate all disputed items with them and pursue our claims with utility management and, with your concurrence, regulatory authorities. All adjustments and corrections agreed to will be submitted by Evercom for our approval, and credit amounts tracked for accurate posting to the proper account. Checks can usually be issued, if preferred. Vendor payments would go directly to Brazos County, not through us. 2 c: ~3 it s d-~ J OL " • 1QI. PERSONNEL All of our personnel have decades of experience. The exact personnel handling each task will be determined once the initial review of records takes place. The particular mix of services billed will determine specific assignments. The experience and background information of key personnel are as follows: Mr. Ben Sanford, President, holds a BBA degree awarded by the University of Texas at Arlington. His experience in communications began with the United States Air Force as a Communications Analyst. Mr. Sanford expanded upon that background by serving as a Business Office Manager with Southwestern Bell Telephone Company and a Communications Consultant with U.S. Telephone of the Southwest. He has been an independent Consultant since January, 1981, and has over twenty- seven years of experience in the telecommunications industry. Mr. Sanford's clients have included such diverse groups as hospitals, schools, manufacturing companies, and city/county governments. He has no ties to any companies representing communications products or services. He is past president of the Southwest Teleconsultants Association, and was the 1992-93 President of the Society of Telecommunications Consultants. He has conducted numerous telecommunications • seminars and delivered speeches before industry and governmental groups. Mr. Chris Beck, Senior Consultant, has a BA degree from the University of Wisconsin-Madison. He was employed by Southwestern Bell and AT&T Information Systems as a Communications Consultant, specializing in the financial and professional service industries. He was associated with an interconnect company as a Technical Marketing Specialist, which involved analysis of the vast array of competitive systems and vendors available in the marketplace. Since becoming an independent consultant in 1986, Mr. Beck's clients have included such entities as City government, education, manufacturing, service, legal, and medical care. He has been with BSA for over ten years and in the telecommunications industry for more than twenty years. His office is in Arlington, Texas. Ms. Paula Cantrell, Independent Consultant, has twenty years experience in telecommunications as a production manager, project manager and as a consultant. She has provided consulting services for UMASS in Worcester and Mt. Sinai in New York as well as various financial institutions and petroleum services companies in across the United States. As a corporate consultant for Banc One, she was responsible for the expense management and allocation of a $12 million annual telecommunication budget in addition to providing network and technology equipment project • management and consulting services. Her office is in San Antonio, Texas. BSA also performs a full range of telecommunications consulting services. Our specialty is design and acquisition of PBX systems, particularly those in a dispersed environment. We feel that an understanding of how telecommunication services actually function is important towards understanding what should be billed, and an important part of vendor negotiations. G~ 2 r ci "~'~F~-+.c_+r~.:.•'.Ts:r;% '"'~.~.:fca.~7vL^r,fa., ter; 0 IV. SOCIETY OF TELECOMMUNICATIONS CONSULTANTS The Society of Telecommunications Consultants was founded in 1976 as the fast non-profit international organization of telecommunications management consultants. STC is actively promoting higher ethical standards of the telecommunications consulting industry and enhancing the capabilities of its members to thereby benefit clients. Mr. Sanford is an active Consultant Member of the Society of Telecommunications Consultants and has served as its Treasurer, Director of Membership, Conference Chairman, Executive Vice President, and was the President in 1992-93. He actively supports the Society's Code of Professional Ethics: STC Code of Ethics 1. Members shall maintain the highest standards of honesty and fair dealing toward their clients past and present, other members, and the general public. 2. Members shall treat all information relating to the affairs of clients, obtained in the course of a consulting assignment, as confidential. 3. Members shall not knowingly place themselves in a position in which their interests are, or may be, in conflict with those of any client. 4. Members are required to terminate any business or organization relationships which would require them to act in manner inconsistent with the principles laid down in this Code. 5. Members shall inform their interests of which Brazos Co aware. 6. In performing service for a other valuable consideration Brazos County. its of any business connections, affiliations, or would have a reasonable expectation to be made ent, no member shall accept any fee, commission or connection with those services from anyone other than 7. Prior to the commencement c f services, members shall make Brazos County fully aware of the fee structure and 411 associated costs. 8. Prior to the commencement o services, members shall take all reasonable steps to ensure that the Client has a c ear understanding of the scope and objectives of the work to be performed. 4 -1 a, r~ U V. REFERENCES BSA's extensive audit experience encompasses numerous companies, including those listed below. We are quite accustomed to large, dispersed clients with m~rty special services. An understanding of not only telephone services, but also data and private line~dl is essential to a project of this scope. Three similar projects completed are: Continental Airlines John Gana Telecommunications Manager, Technology Section 1600 Smith Street, Suite 4700 HQSTK Houston, TX 77002 713-324-5538 U City of Houston Buddy Ruby (recently retired) Network and Communications Management P.O. Box 1562 Houston, Texas 77251 713-837-9804 Northeast Independent School District 3736 Perrin Central San Antonio, Texas 78217 Virginia Flores 210-637-4973 Michelle Ferrara 210-804-7112 CONTINENTAL AIRLINES BSA provided an audit of all Continental telecommunications billing in the United States. This involved over 500 bills per month and covered services in 43 states. Working only from number lists, BSA obtained the needed bill copies and records from every major telephone company in the U.S. Copies of contracts and other documentation were gathered from Continental and their various vendors across the country. Mr. Sanford personally reviewed every customer service record received and noted questionable areas. Premises visits were made by Mr. Sanford at several major hub locations to identify services in place and meet with local Continental and EDS personnel (PBX and communications maintenance was outserviced to EDS) to gather information needed. Calls were placed to hundreds of numbers that could not be located. This process not only yielded numerous billing errors, it identified hundreds of abandoned lines that were then disconnected. +a~q ;4+ /4dr Major claims were filed with Pac Bell, New Jersey Bell, and Southwestern Bell. Despite telco resistance, BSA successfully negotiated large settlements totaling hundreds of thousands of dollars. Continental received status reports and memos throughout the project to keep them informed and identify issues. Airline personnel time was kept to a minimum. CITY OF HOUSTON The City of Houston retained Ben Sanford & Associates in February 1989 to review and audit the monthly recurring charges from Southwestern Bell Telephone Company and AT&T. In order to properly perform this task, Ben Sanford worked very closely with Network & Communications Management personnel to obtain copies of billing records, both current and historical, and assemble and review all existing city information available. A complete tariff analysis was then undertaken. BSA then performed an extensive physical verification of all city telecommunications network services and rental equipment. Mr. Sanford visited virtually every city location personally. Network services were noted at all demarcation points, city and telephone company physical locations were spotted on maps, inside and outside cable plant connecting various buildings was noted, and interviews were conducted with numerous city personnel from almost all departments regarding the billed services and their functions. Site and building plans were also collected and utilized. In order to adequately evaluate the myriad of billed items, Mr. Sanford had to fully comprehend the city's past and present communications network structure, both voice and data. In order to accomplish this, he worked very closely and effectively with numerous city personnel. After reconciliation of the billing, a lengthy and complicated claim was filed. Protracted negotiations with Southwestern Bell and AT&T then ensued. During this process, Mr. Sanford continued to work closely with numerous city management and staff. The knowledge obtained in regards to City of Houston operations and his years of experience working with other governmental communications operations proved invaluable in these negotiations. The result was a refund of over $268,000 from the telephone company and AT&T as well as correction ofthe billing involved. The City was pleased with the entire project and then retained BSA to perform another audit in 1999, which also yielded over $200,000 in refunds. aa. • • • NORTHEAST INDEPENDENT SCHOOL DISTRICT BSA completed an audit of all telecommuni ations billing for the NorthEast ISD in San Antonio, which is one of the largest school districts in the state, and one of Southwestern Bell's largest Plexar customers. An extensive tariff analysis took place and any areas were investigated. A comprehensive claim was filed with Southwestern Bell. Most item; were initially rejected, and SW Bell generally denied committing any errors. After extensive negotiations, refunds approaching $200,000 were obtained. NEISD then retained us for a review of cellular billing, which also yielded additional refunds. All of this was accomplished without extensive NEISD personnel time. alienating the telephone company, and without 6 1~1 AUDIT AGREEMENT Ben Sanford & Associates, Inc. (hereinafter referred to as BSA) agrees to acquire and audit all records issued by appropriate telephone utilities and vendors. The Client (identified below) agrees to authorize BSA or its representatives as Agents in dealing with the billing entities by written Letter of Agency, and agrees to support BSA or its representatives in their negotiations with billing entities. Client: Brazos County Address: 300 E. 26" Street City & State: Brvan, Texas 77803 Telephone: All Inmate Telecommunications Billing If any overcharges are discovered by BSA, the resulting refunds or credits, if any, will be divided in the following manner: Client agrees to pay fifty percent (50%) of all refunds or billing credits obtained by BSA as a result of this process or any part thereof, plus any applicable taxes. Payment is due within thirty (30) days from receipt of such refunds or credits. If, despite good faith efforts on the part of Client and Consultant, no refunds are obtained, there is no fee. Offered by: Ben Sanford Ben Sanford & Associates, Inc. Company President 40111- Title Date Accepted by: Name Brazos County Company County Judge 12/17/2002 Title Date 31 .~~+~`~+~r ~ •~`t ~~'J ter? ....~.n ~r _`~-c,~ ..L C. TONY JONES ° Precinct 1 361-4106 Brazos County Commissioners Court VIM. S. THORNTON ALVIN W. JONES Precinct 2 County Judge Precinct (979) 3614102 361-4115 December 17, 2002 • Evercom Systems, Inc. Verizon All other Telephone Service & Supply Companies To Whom It May Concern: RANDY SIMS Precinct 3 361-4105 CAREY CAULEY, JR. Precinct 4 361-4111 Brazos County has retained Ben Sanford and Associates, Inc. as our authorized agent to interface with your company regarding all aspects of our communication systems and services. The agency authorization shall continue in effect until you are notified of its cancellation in writing. This authorization shall in no way preclude Brazos County, or any other authorized agents, from dealing directly with you. Upon their request, please send any correspondence to: BEN SANFORD & ASSOCIATES, INC. 1150 N. Loop 1604 West, Suite 108-615 San Antonio, Texas 78248 Sincerely, • Alvin W. Jones County Judge Copy: Ben Sanford & Associates, Inc. Brazos County Courthouse 300 Eas 2 tf~ f. - ude 114 B'ryan''~ekgas 7T803~5327 • Fax: (979) 823-6993 0 EON Wiltons Officeworks Save-On Quick Delive Cat orles % Discount % Discount % Discount General Office Supplies 36% 46% 45% Paper 36% 36% 50% Business Machines Electronic Products 10% 16% 25% Cameras and Film net 10.50% 25% Money Handling Supplies 30% 20% 25% Furniture (Not covered on bid) 25%. 38.50% 50% Delivery Date 1 day 1 day 2-3 days Workers' Compensation Yes Yes Yes Comprehensive General Liability Yes Yes Yes Automobile Liability Insurance Yes Yes Yes Can provide catalogue/no cost? Yes Yes Yes Primary Vendor: Sav-On Office % Discount is from United Stationers Office Products Cataloa Prices i .j t~ i •-r u~ "Quick Delivery Office Supply had the highest percentage off In most categories, but the bid specifications specifically stated and underlined that the catalogue must be presented with the bid, and Quick Delivery did not supply a catalogue.