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HomeMy WebLinkAbout04. Adopt amended and restated Section 125 Cafeteria Plan and component documents and two new Health Reimbursement Arrangements Page 1 of 138 Item 4. CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER MEETING DATE: MAY 16, 2019 SUBJECT: ADOPT THE FOLLOWING, ALL EFFECTIVE JULY 1, 2019: • AMENDED AND RESTATED (A) SECTION 125 CAFETERIA PLAN, INCLUDING THE NEW PREMIUM CONVERSION ACCOUNT LANGUAGE REQUIRED FOR THE TRANSITION TO CALPERS HEALTH BENEFITS PROGRAM, AND (B) THREE ASSOCIATED COMPONENT PLANS; AND • NEW PLAN DOCUMENTS FOR TWO NEW HEALTH REIMBURSEMENT ARRANGEMENTS (HRA) SUBMITTED BY: INITIATING DEPARTMENT: TEJI O'MALLEY, HUMAN RESOURCES OPERATIONS - POD - HUMAN RESOURCES MANAGER REVIEWED BY: ANN SASAKI, DEPUTY GENERAL MANAGER Roger S. Bailey Kenton L. Alm General Manager District Counsel ISSUE Board of Directors approval is required to amend the District's Section 125 Cafeteria Plan Document as well as adopt new plan documents for two new Health Reimbursement Arrangements (HRA). BACKGROUND On March 21, 2019, the Board adopted resolutions in order for the District to participate in the CaIPERS Health Benefits Program, which is governed by the Public Employees' Hospital and Medical Care Act (PEHMCA), effective July 1, 2019. The District elected to set the employer contributions at the minimum levels required to participate in CalPERS. As such, the District will contribute directly to CalPERS $136 per month for each active employee and $1 per month for each retiree for calendar year 2019. These May 16, 2019 Regular Board Meeting Agenda Packet- Page 19 of 549 Page 2 of 138 amounts will increase every year that the District participates in CalPERS. The minimum for active employees is adjusted annually by changes in the medical care component of the Consumer Price I ndex- Urban, and the retiree contribution is adjusted each year by 5% of the active employee contribution added to the previous year's retiree contribution until they are the same for both active employees and retirees, which would happen in 20 years. The District's actual contributions will be made in accordance with the applicable provisions of the memoranda of understanding (MOUs), which exceed the aforementioned minimum amounts. I n order for the District to adhere to the employer contributions outlined in the resolutions, the premium amounts above and beyond the PEHMCA minimum must be paid through a component of the Section 125 Cafeteria Plan for active employees and through a Health Reimbursement Arrangement (HRA)for retirees. Amendment to Cafeteria Plan and Component Documents The Cafeteria Plan must be amended to include a new subsection which will allow the District to credit the Premium Conversion account of each of the District's active employees who is enrolled in a CalPERS health plan with a dollar amount up to or equal to the premium of the highest cost core plan minus the minimum amounts that are outlined in the resolutions adopted by the Board. Those amounts will then be paid to CalPERS. The Cafeteria Plan Document also has the following three associated "Component Plans": a. Premium Conversion Plan b. Health Flexible Spending Arrangement Plan C. Dependent Care Assistance Plan Neither the Cafeteria Plan Document nor the above Component Plan documents have been comprehensively reviewed or updated since 2013, and they do not at present include changes previously approved and implemented by the District. Therefore, staff used this opportunity to have the District's employee benefits counsel, Hanson Bridgett LLP, review each of these documents in their entirety and recommend changes. All prior approved changes have been incorporated, along with numerous but non-substantive changes to clean up the documents and provide clarity. The onl-y substantive change is the addition of Premium Conversion account language required b-y the transition to CaIPERS Health Benefits Program. Redlined versions were distributed with the agenda packet for the April 16, 2019 Administration Committee meeting. The new Premium Conversion account language can be found in Article 3.2.(b) of the amended and restated Cafeteria Plan Document (Attachment 1). Attachments 1 through 4 are the finalized versions of the amended and restated documents. During the discussion at the Administration Committee meeting, District Counsel Kent Alm stated that the Board could include in their motion that they are approving the documents in "substantially the form presented," which would give staff the right to remedy any inadvertent errors. Two New HRA Plans As part of the transition to CalPERS Health Benefits Program and to implement a new benefit for certain employees as explained below, two new HRA Plans are proposed for adoption. Retiree-Only HRA A new HRA plan is being implementing solely for retirees for those premium amounts above and beyond the PEHMCA minimum, since no such plan existed prior to the transition to CalPERS. It will also be utilized to continue the reimbursements for Medicare premiums as well as for retirees who choose to waive District coverage, purchase their own coverage, and get reimbursed up to the maximum paid for retirees on District coverage. See Attachment 5. May 16, 2019 Regular Board Meeting Agenda Packet- Page 20 of 549 Page 3 of 138 Tier 111 HRA As an outcome of labor negotiations in 2018, the District agreed to implement a new benefit for employees who are considered Tier I I I employees (those hired after June 30, 2009) of both the Employees'Association, Public Employees Union, Local #1 and the Management Support/Confidential Group (MS/CG). This benefit will be administered through a new HRA. Effective July 1, 2019, the District will contribute 1.5-percent of these employees' base salary to an HRA that can then be utilized by the employees for eligible medical expenses after leaving District employment. See Attachment 6. ALTERNATIVES/CONSIDERATIONS As this item has been negotiated with the District's bargaining units, not approving this action would be in violation of the MOUs already approved by the Board in 2018. FINANCIAL IMPACTS None, as adopting this amendment to the Section 125 Plan and the new plan documents are for benefits that have previously been approved by the Board. COMMITTEE RECOMMENDATION The Administration Committee reviewed this item during its April 16, 2019 meeting and recommended approval. RECOMMENDED BOARD ACTION Adopt the following: 1. Amended and restated: (a) Section 125 Cafeteria Plan, including the new Premium Conversion account language required for the CalPERS transition, and (b)three associated Component Plans, all in substantially the form presented; 2. New Health Reimbursement Arrangement (HRA) Plan document for retirees only; and 3. New HRA Plan Document for Tier I I I employees of Local #1 and MS/CG. All of the above to be effective July 1, 2019. Strategic Plan Tie-In GOAL TWO: Strive to Meet Regulatory Requirements Strategy 3- Comply with all federal, state, and local regulations related to District administration ATTACHMENTS: 1.Amended and Restated Section 125 Cafeteria Plan Document 2. Premium Conversion Plan Document 3. Health Flexible Spending Arrangement Plan Document 4. Dependent Care Assistance Plan Document 5. Retiree Health Reimbursement Arrangement Plan Document 6. Tier I I I Health Reimbursement Arrangement Plan Document May 16, 2019 Regular Board Meeting Agenda Packet- Page 21 of 549 Page 4 of 138 ATTACHMENT 1 CENTRAL CONTRA COSTA SANITARY DISTRICT SECTION 125 CAFETERIA PLAN Amended and Restated Effective July 1, 2019 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 22 of 549 Page 5 of 138 TABLE OF CONTENTS Page INTRODUCTION ...........................................................................................................................1 ARTICLE 1: DEFINITIONS ...........................................................................................................3 1.1 Account....................................................................................................................3 1.2 Administrative Committee.......................................................................................3 1.3 Board........................................................................................................................3 1.4 COBRA....................................................................................................................3 1.5 Code.........................................................................................................................3 1.6 Compensation ..........................................................................................................3 1.7 Component Plan.......................................................................................................3 1.8 Dependent................................................................................................................4 1.9 Effective Date ..........................................................................................................4 1.10 Eligible Employee....................................................................................................4 1.11 Eligible Expense ......................................................................................................4 1.12 Employee.................................................................................................................4 1.13 Employer..................................................................................................................4 1.14 Employer Credit.......................................................................................................5 1.15 FMLA ......................................................................................................................5 1.16 Open Enrollment Period ..........................................................................................5 1.17 Participant................................................................................................................5 1.18 Period of Coverage ..................................................................................................5 1.19 Plan ..........................................................................................................................5 1.20 Plan Administrator...................................................................................................5 1.21 Plan Year..................................................................................................................5 1.22 Salary Reduction......................................................................................................6 1.23 Spouse......................................................................................................................6 ARTICLE 11: ELIGIBILITY AND PLAN PARTICIPATION.......................................................7 2.1 Commencement of Participation..............................................................................7 2.2 Termination of Participation....................................................................................7 2.3 Resumption of Participation ....................................................................................7 2.4 FMLA Leaves of Absence.......................................................................................8 2.5 Non-FMLA Leaves of Absence.............................................................................10 i 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 23 of 549 Page 6 of 138 ARTICLE III: PLAN FUNDING..................................................................................................11 3.1 Establishment of Accounts ....................................................................................11 3.2 Employer Credits...................................................................................................11 3.3 Salary Reduction Credits.......................................................................................12 3.4 Designation of Salary Reduction and Employer Credits to Subaccounts..............12 3.5 Time for Making Elections....................................................................................12 3.6 Change or Revocation of Elections........................................................................13 3.7 Limit on Amount Credited to DCAP Subaccount.................................................21 3.8 Limit on Amount Credited to Health FSA Subaccount.........................................21 3.9 Limit on Amount Credited to PCP Subaccount.....................................................21 3.10 Plan Administrator's Power to Modify and Suspend Elections.............................21 ARTICLE IV: BENEFITS.............................................................................................................23 4.1 General Rule..........................................................................................................23 4.2 Health FSA.............................................................................................................23 4.3 Dependent Care Expenses......................................................................................23 4.4 Premium Expenses.................................................................................................23 4.5 Cash Benefits.........................................................................................................23 ARTICLE V: PLAN ADMINISTRATION...................................................................................24 5.1 Plan Administrator.................................................................................................24 5.2 Plan Administrator's Powers and Duties...............................................................24 5.3 General Plan Administration..................................................................................26 5.4 Reliance on Information Furnished by Others.......................................................26 5.5 Indemnification by Employer................................................................................27 5.6 Discretionary Power of Plan Administrator...........................................................27 5.7 Compensation of Plan Administrator.....................................................................27 5.8 Inability to Locate Payee .......................................................................................27 ARTICLE VI: CLAIMS PROCEDURES .....................................................................................29 6.1 Claim Procedures...................................................................................................29 6.2 Appeal Procedure...................................................................................................29 6.3 Agent for Service of Process..................................................................................30 6.4 Notices...................................................................................................................30 6.5 Evidence.................................................................................................................30 ARTICLE VII: MISCELLANEOUS.............................................................................................31 ii 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 24 of 549 Page 7 of 138 7.1 Component Plans Control......................................................................................31 7.2 Governing Law......................................................................................................31 7.3 Severability............................................................................................................31 7.4 Plan Not An Employment Contract.......................................................................31 7.5 Non-Assignability of Rights..................................................................................31 7.6 Facility of Payment................................................................................................32 7.7 Mistake...................................................................................................................32 7.8 Expenses ................................................................................................................32 7.9 Compliance With Code and Other Applicable Laws.............................................32 7.10 No Guarantee of Tax Consequences......................................................................33 7.11 Insurance Contracts................................................................................................33 ARTICLE VIII: AMENDMENT AND TERMINATION............................................................34 8.1 Amendment............................................................................................................34 8.2 Termination............................................................................................................34 ARTICLE IX: EXECUTION ........................................................................................................35 APPENDIX A 1 iii 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 25 of 549 Page 8 of 138 CENTRAL CONTRA COSTA SANITARY DISTRICT SECTION 125 CAFETERIA PLAN INTRODUCTION Effective as of July 1, 2019, the Central Contra Costa Sanitary District (the "Employer") hereby amends and restates the Central Contra Costa Sanitary District Section 125 Cafeteria Plan (the "Plan") to provide benefits for certain of its employees. This Plan incorporates the Central Contra Costa Sanitary District Premium Conversion Plan ("PCP"), the Central Contra Costa Sanitary District Health Flexible Spending Arrangement Plan ("Health FSA"), and the Central Contra Costa Sanitary District Dependent Care Assistance Plan ("DCAP") (collectively, the "Component Plans") covering Eligible Employees of the Employer, as listed in Appendix A of this Plan. The Employer originally adopted the Plan and the Component Plans effective May 1, 1989. Since then, the Employer has amended the Plan and the Component Plans on various occasions. The Employer most recently amended and restated the Plan and the Component Plans effective January 1, 2013, and has amended the Plan once since then. The Plan and the Component Plans are intended to satisfy the applicable requirements of Code sections 105, 106, 125, and 129, and any other applicable law. The Plan is specifically intended to qualify as a "cafeteria plan" under Code section 125, and is to be interpreted in a manner consistent with the requirements of section 125. The Employer established the Plan to provide Eligible Employees with a choice between cash and certain "qualified benefits" as defined in Code section 125(f) and the regulations thereunder. This Plan and all Component Plans listed in Appendix A are maintained for the exclusive benefit of the Employer's Employees. The provisions of this Plan shall apply only to certain employees of the Employer who are eligible to receive benefits under at least one of the Component Plans listed in Appendix A. The rights and benefits, if any, of former Employees will be determined in accordance with provisions of the Plan in effect on the date employment terminated. 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 26 of 549 Page 9 of 138 Appendix A, Component Plans, attached to this Plan is incorporated herein by reference and is a part hereof, and may be amended without necessity for other amendment of this Plan. 2 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 27 of 549 Page 10 of 138 ARTICLE I: DEFINITIONS When used in this Plan and in the Component Plans, the following words and phrases will, except as specifically provided in the Component Plans, have the following meanings, unless the context clearly indicates otherwise: 1.1 Account The bookkeeping account established for each Participant under Section 3.1. Each Account will be comprised of a PCP Subaccount, Health FSA Subaccount, or DCAP Subaccount (each a "Subaccount," and collectively, "Subaccounts") as described in that section. 1.2 Administrative Committee The committee appointed by the Board in accordance with Section 5.1. 1.3 Board The Employer's Board of Directors. 1.4 COBRA The Consolidated Omnibus Budget Reconciliation Act of 1985, as amended. 1.5 Code The Internal Revenue Code of 1986, as amended. 1.6 Compensation The total wages paid during a Plan Year to the Employee by the Employer, as reported in Box 1 of Form W-2,plus amounts that would be included in wages but for an election under Code sections 125(a), 132(f)(4), or 457(b). 1.7 Component Plan A separate written plan maintained by the Employer to provide health flexible spending arrangement benefits or dependent care assistance to Eligible Employees or to permit Eligible Employees to pay their share of the cost of the Employer group health insurance benefits on a pre-tax basis. Such Component Plans are listed in Appendix A and incorporated herein. Such Component Plans may be amended at any time without necessity for other amendment of this 3 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 28 of 549 Page 11 of 138 Plan. Each Component Plan is governed by the terms of its plan document, which terms shall prevail in case of any conflict between this Plan and a Component Plan. 1.8 Dependent Dependent as defined in the applicable Component Plan. 1.9 Effective Date July 1, 2019, the date this amendment and restatement of the Plan is effective. Each Component Plan is effective as of the date set forth in the Component Plan. 1.10 Eligible Employee A regular Employee who is regularly scheduled to work at least 30 hours per week. "Eligible Employee" excludes an Employee who the Employer classifies as seasonal or temporary. 1.11 Eligible Expense An Eligible Premium Expense, Eligible Medical Expense, or Eligible Dependent Care Expense, each as defined in the PCP, Health FSA, and DCAP, respectively. 1.12 Employee An individual who the Employer classifies as a common-law employee, and who the Employer reports on a Form W-2. "Employee" excludes any individual who (a)the Employer classifies as a "leased employee" (as defined in Code section 414(n)), an independent contractor or a contract worker, or(b)performs services for the Employer, but who is paid by a temporary or other employment staffing agency for the period during which the individual is paid by such agency and not by the Employer as a common-law employee, whether or not a court or administrative agency determines such individual is a common-law employee. 1.13 Employ The Central Contra Costa Sanitary District, and any organization that is a successor thereto. 4 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 29 of 549 Page 12 of 138 1.14 Employer Credit The amounts the Employer credits to Participants' Accounts under Section 3.2 to be used by Participants to pay Eligible Expenses under the Component Plans. 1.15 FMLA The Family and Medical Leave Act of 1993, as amended. 1.16 Open Enrollment Period The period during the Plan Year during which Eligible Employees may elect to participate in the Plan or make changes to their elections for the next Plan Year. The Employer will determine this period each Plan Year, which period the Administrator will make known in the Plan's open enrollment materials. 1.17 Participant An Eligible Employee who participates in the Plan in accordance with Article It. 1.18 Period of Coverage The Plan Year, with the following exceptions: (a) for a newly eligible Employee, the portion of the Plan Year beginning when he or she commences participation in accordance with Section 2.1, and (b) for a Participant who ceases participation, the portion of the Plan Year ending when his or her participation terminates in accordance with Section 2.2. 1.19 Plan The Central Contra Costa Sanitary District Section 125 Cafeteria Plan, the terms of which are set forth herein, as it may be amended from time to time. 1.20 Plan Administrator The Employer or the persons, if any, appointed by the Employer to administer the Plan in accordance with Section 5.1. 1.21 Plan Year The 12-consecutive-month period beginning each January 1 st and ending December 31 st. 5 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 30 of 549 Page 13 of 138 1.22 Salary Reduction The amount by which a Participant's Compensation is reduced pursuant to the Participant's election in accordance with Article III.This amount is credited to the Participant's Account, as provided in Article III, for the sole purpose of paying Eligible Expenses. 1.23 Spouse The individual who is legally married to the Participant under applicable state law and who is treated as a spouse under the Code. A civil union partner or domestic partner is not treated as a Spouse under the Code. The DCAP more specifically defines Spouse for purposes of that plan. 6 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 31 of 549 Page 14 of 138 ARTICLE II: ELIGIBILITY AND PLAN PARTICIPATION 2.1 Commencement of Participation Each Participant in the Plan as in effect immediately before the Effective Date who has not elected to terminate coverage under all Component Plans will remain a Participant. On and after that date, an individual will become a Participant on the first day of the month after he or she becomes an Eligible Employee or, if later, when he or she submits a timely election to participate in accordance with Article III. 2.2 Termination of Participation A Participant's participation in the Plan terminates upon the earliest of- (a) £(a) the termination of the Plan or all Component Plans; (b) the Participant's permitted election not to participate in the Plan or all Component Plans; or (c) the Participant ceases to be an Eligible Employee. Termination of participation in this Plan will automatically revoke the Participant's elections. If revocation occurs under this Section 2.2, no new election may be made by such Participant during the remainder of the Plan Year unless otherwise permitted under the Plan. 2.3 Resumption of Participation If a Participant terminates his or her employment for any reason, including (but not limited to) disability, retirement, layoff, or voluntary resignation, and then is rehired or becomes eligible once again within 30 days after termination, then the individual will be reinstated with the same elections that he or she had before termination. If a former Participant is rehired more than 30 days after termination of employment and is otherwise eligible to participate in the Plan, then the individual may make new elections as a new hire as described in Section 3.5(a). Despite the preceding, an election to participate in the PCP will be reinstated only to the extent that coverage under the applicable group health plan is reinstated. If an Employee (whether or not a Participant) ceases to be an Eligible Employee for any reason (other than for termination of employment), including(but not limited to) a reduction of hours, 7 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 32 of 549 Page 15 of 138 and then becomes an Eligible Employee again, the Employee can participate in the Plan by making a timely election to participate in accordance with Article III. 2.4 FMLA Leaves of Absence (a) Health Insurance Benefits. Despite any contrary Plan provision, if a Participant goes on a qualifying leave under the FMLA, then to the extent required by the FMLA, the Employer will continue to maintain the Participant's health insurance benefits and Health FSA benefits on the same terms and conditions as if the Participant were still an active Employee. That is, if the Participant elects to continue his or her coverage while on leave, the Employer will continue to pay its share of the contributions for those benefits under this Plan. The Employer may require Participants to continue all health insurance benefits and Health FSA benefits coverage while they are on paid leave (provided that Participants on non-FMLA paid leave are required to continue coverage). If so, the Participant's share of the contributions will be paid by the method normally used during any paid leave (e.g., on a pre- tax Salary Reduction basis). In the event of unpaid FMLA leave(or paid FMLA leave where the Employer does not require coverage to be continued), a Participant may elect to continue his or her health insurance benefits and Health FSA benefits during the leave. If the Participant elects to continue coverage while on FMLA leave, then the Participant may pay his or her share of the contributions in one of the following ways: (i) With after-tax dollars, by sending monthly payments to the Employer by the due date established by the Employer; (ii) With pre-tax dollars, by having such amounts withheld from the Participant's ongoing Compensation(if any), including unused sick days and vacation days, or pre-paying all or a portion of the contributions for the expected duration of the leave on a pre- tax Salary Reduction basis out of pre-leave Compensation. To pre-pay the contributions, the Participant must make a special election to that effect prior to the date that such Compensation would normally be made available (pre-tax dollars may not be used to fund coverage during the next Plan Year); or 8 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 33 of 549 Page 16 of 138 (iii) Under another arrangement agreed upon between the Participant and the Plan Administrator (e.g., the Plan Administrator may fund coverage during the leave and withhold "catch-up" amounts from the Participant's Compensation on a pre-tax or after-tax basis) upon the Participant's return. If the Employer requires all Participants to continue health insurance benefits and Health FSA benefits during an unpaid FMLA leave, then the Participant may elect to discontinue payment of the Participant's required contributions until the Participant returns from leave. Upon returning from leave, the Participant will be required to repay the contributions not paid by the Participant during the leave. Payment will be withheld from the Participant's Compensation either on a pre-tax or after-tax basis, as agreed to by the Plan Administrator and the Participant. If a Participant's health insurance benefits or Health FSA benefits coverage ceases while on FMLA leave(e.g., for non-payment of required contributions),then the Participant is permitted to reenter the PCP or Health FSA as applicable, upon return from such leave on the same basis as when the Participant was participating prior to the leave,or as otherwise required by the FMLA. In addition, the Plan may require Participants whose health insurance benefits or Health FSA coverage terminated during the leave to be reinstated in such coverage upon return from a period of unpaid leave, provided that Participants who return from a period of unpaid,non-FMLA leave are required to be reinstated in such coverage. Despite the preceding sentence, with regard to Health FSA benefits, a Participant whose coverage ceased will be permitted to elect whether to be reinstated in the Health FSA benefits at the same coverage level as was in effect before the FMLA leave (with increased contributions for the remaining period of coverage)or at a coverage level that is reduced pro rata for the period of FMLA leave during which the Participant did not pay contributions. If a Participant elects a coverage level that is reduced pro rata for the period of FMLA leave, then the amount withheld from a Participant's Compensation on a pay-period-by-pay-period basis for the purpose of paying for reinstated Health FSA benefits will be equal to the amount withheld on a pay-period-by-pay- period basis prior to the period of FMLA leave. (b) Non-Health Benefits. If a Participant goes on a qualifying leave under the FMLA, then entitlement to non-health benefits (such as DCAP benefits) is to be determined 9 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 34 of 549 Page 17 of 138 by the Employer's policy for providing such benefits when the Participant is on non-FMLA leave, as described in Section 2.5. If such policy permits a Participant to discontinue contributions while on leave, then the Participant will, upon returning from leave, be required to repay the contributions not paid by the Participant during the leave. Payment will be withheld from the Participant's Compensation either on a pre-tax or after-tax basis, as may be agreed upon by the Plan Administrator and the Participant or as the Plan Administrator otherwise deems appropriate. 2.5 Non-FMLA Leaves of Absence If a Participant goes on an unpaid leave of absence that does not affect eligibility, then the Participant will continue to participate and the contributions due for the Participant will be paid by pre-payment before going on leave, by after-tax contributions while on leave, or with catch-up contributions(on a pre-tax or after-tax basis)after the leave ends,as may be permitted by the Plan Administrator. If a Participant goes on an unpaid leave that affects eligibility,then the applicable election change rules in Section 3.6 will apply. 10 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 35 of 549 Page 18 of 138 ARTICLE III: PLAN FUNDING 3.1 Establishment of Accounts The Employer will establish and maintain an Account for each Participant comprised of a Health FSA Subaccount, a DCAP Subaccount, and a PCP Subaccount. The Employer will credit each Subaccount with the amounts specified in Sections 3.2 and 3.3 in accordance with the Participant's designations under Section 3.4. Accounts are for bookkeeping purposes only; benefits under the Plan will be paid entirely from the general assets of the Employer. No provision of this Plan will be construed to require the Employer or Plan Administrator to maintain any fund or segregate any amount for the benefit of any Participant, and no Participant or other person will 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. The Plan does not create a trust in favor of a Participant or any person claiming on a Participant's behalf. 3.2 Employer Credits (a) The Employer will credit each Participant's Account each month with an Employer Credit equal to the amount that the Employer has agreed in the applicable Memorandum of Understanding or individual employment agreement to contribute to the Plan on the Participant's behalf for the Participant to use to pay the cost of any benefit elected by the Participant under the Plan. (b) The Employer will, each month, credit the PCP Subaccount of each Participant who is enrolled in a Public Employees' Medical and Hospital Care Act ("PEMHCA") health plan for the month with an Employer Credit for the exclusive purpose of paying the applicable health plan premium. The Employer Credit will, when added to the applicable PEMHCA minimum employer contribution paid by the Employer directly to the California Public Employees' Retirement System on the Participant's behalf for the Plan Year, equal the health insurance premium the Employer has agreed in the applicable Memorandum of Understanding or individual employment agreement to pay on the Participant's behalf. 11 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 36 of 549 Page 19 of 138 (c) The Employer will, each month, credit the Health FSA Subaccount of each Participant who is a Board member, and who elects to waive coverage under the Employer's group health plans with an Employer Credit equal to $41.66. 3.3 Salary Reduction Credits Each Participant may make a written Salary Reduction election to have his or her annual Compensation reduced,but not below zero,by an amount not to exceed the cumulative total of the maximum limitations as stated in Plan Sections 3.7 and 3.8. 3.4 Designation of Salary Reduction and Employer Credits to Subaccounts (a) Each Participant who elects Salary Reduction or who is credited with Employer Credits must designate the Salary Reduction or Employer Credits to be applied during the Plan Year to one or more of the benefits described in Article IV, and the amounts so designated will be credited to the appropriate Subaccounts within the Participant's Account. (b) No Salary Reduction or Employer Credits will be credited to a Participant's Account until the Participant has made such designation. (c) Each Subaccount will be debited during the Plan Year for any benefits paid. Amounts designated to each Subaccount may not be changed during the Plan Year, except as provided in Section 3.6. Eligible Medical Expenses (as defined in Section 1.3 of the Health FSA) will be reimbursed in accordance with Article V of the Health FSA.Eligible Dependent Care Expenses (as defined in Section 1.5 of the DCAP) will be reimbursed in accordance with Article V of the DCAP. Eligible Premium Expenses (as defined in Section 1.3 of the PCP) will be paid in accordance with Article V of the PCP. 3.5 Time for Making Elections (a) Salary Reduction and benefit election forms must be properly completed and submitted annually to the Plan Administrator during the Open Enrollment Period before the first day of each Plan Year. If an Eligible Employee initially becomes eligible to participate in the Plan mid-year,he or she must properly complete and submit a Salary Reduction and benefit 12 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 37 of 549 Page 20 of 138 election form to the Plan Administrator within 30 days after he or she first becomes eligible to participate in the Plan. (b) If an Eligible Employee fails to make a timely election,he or she will be deemed to have elected to receive cash in lieu of benefits under the Health FSA,the DCAP, or the PCP as described in Article IV. 3.6 Change or Revocation of Elections Except as provided in this section, a Participant's Salary Reduction and benefit elections for any Period of Coverage are irrevocable for the duration of the Period of Coverage. Therefore, unless an exception applies, a Participant may not change any Salary Reduction or benefit elections for the duration of the Period of Coverage. A mid-year election change will be permitted upon the occurrence of an event described in this section only if it is made on account of and corresponds with, as defined by Treasury regulations or other applicable guidance issued under Code section 125,the event. Except as provided in subsection(a)of this section, an election change must be made within 30 days of the occurrence of an event described in this section. (a) Special Enrollment Rights. A Participant may revoke his or her election for group health plan coverage under the PCP during a Period of Coverage and make a new election for the balance of the Period of Coverage that corresponds with the special enrollment rights under a group health plan that the Participant or his or her Spouse or Dependent is entitled to under Code section 9801(f). The Participant must make any new election within 30 days or 60 days, as applicable, in accordance with the notice requirement under Code section 9801(f). Such election change will apply prospectively, unless otherwise required by Code section 9801(f)to be retroactive.No election change may be made to the Health FSA or DCAP under this Section 3.6(a). A special enrollment right will arise in the following circumstances: (i) A Participant or his or her Spouse or Dependent declined to enroll in group health plan coverage because he or she had coverage, and eligibility for such coverage is subsequently lost because: (a) the coverage was provided under COBRA, and the COBRA coverage was exhausted, or (b) the coverage was non-COBRA coverage and the coverage terminated due to loss of eligibility for coverage or the employer contributions for the coverage were terminated; 13 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 38 of 549 Page 21 of 138 (ii) A new Dependent is acquired as a result of marriage,birth, adoption, or placement for adoption; (iii) The Participant or Dependent becomes eligible for a state premium assistance subsidy from a Medicaid plan or through a state children's health insurance program with respect to coverage under the group health plan; or (iv) The Participant's or Dependent's coverage under a Medicaid plan or state children's health insurance program is terminated as a result of loss of eligibility for such coverage. (b) Change in Status. A Participant may change his or her election during a Period of Coverage for the remainder of the Period of Coverage under the PCP, the Health FSA, and the DCAP, as further limited below, upon a Change in Status, but only if the election change is made on account of and corresponds with a Change in Status that affects eligibility for coverage under an Employer's plan or a Spouse's or Dependent's employer's plan. Generally, an election change corresponds with a Change in Status involving a Participant's divorce, annulment, or legal separation from a Spouse, the death of a Spouse or Dependent, or a Dependent's ceasing to satisfy the eligibility requirements for accident or health coverage only if the election is to cancel accident or health coverage for the individual involved in the event. In addition, an election change generally corresponds with a Change in Status involving a Participant, Spouse or Dependent gaining eligibility for coverage under an Employer's plan or a Spouse's or Dependent's employer's plan only if the coverage for that individual becomes effective or is increased under the Employer's plan or the Spouse's or Dependent's employer's plan. Finally, with respect to the DCAP, a Participant may change or terminate his or her election upon a Change in Status if(i) such change or termination is made on account of and corresponds with a Change in Status that affects eligibility for coverage under an employer's plan, or(ii) the election change is on account of and corresponds with a Change in Status that affects eligibility of dependent care expenses for the tax exclusion under Code section 129. A "Change in Status" means any of the events described below, as well as any other events included under subsequent changes to Code section 125 or regulations issued thereunder, which the Plan Administrator, in its sole discretion and on a uniform consistent basis, determines are permitted under IRS regulations and under this Plan: 14 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 39 of 549 Page 22 of 138 (i) Legal Marital Status. A change in a Participant's legal marital status including marriage, the Spouse's death, divorce, legal separation and annulment. (ii) Number of Dependents. An event that changes the number of a Participant's Dependents including birth, death, adoption and placement for adoption. (iii) Employment Status. Any of the following events that change the employment status of a Participant or his or her Spouse or Dependents: (a) a termination or commencement of employment; (b) a strike or lockout; (c) a commencement of or a return from an unpaid leave of absence; (c) a change in worksite; and (d) when the eligibility conditions of the Plan, a Component Plan, or other employee benefits plan of the Participant or his or her Spouse or Dependent depends on the employment status of that individual and there is a change in that individual's employment status with the consequence that the individual becomes (or ceases to be) eligible under such plan. (iv) Dependent Eli ig bility Requirements. An event that causes a Dependent to satisfy or to cease to satisfy the eligibility requirements for a particular benefit, such as attaining a specified age or any similar circumstance. (v) Change in Residence. A change in residence of a Participant or a his or her Spouse or Dependents. (vi) COBRA Eli ibg ility_. If a Participant, or a Participant's Spouse or Dependent, becomes eligible under Code section 498013, or any similar state law, for continuation coverage in a group health plan offered by the Employer, a Participant may increase his or her Salary Reduction to pay for such continuation coverage. (c) Certain Judgments, Decrees, or Orders A judgment, decree, or order resulting from a divorce, legal separation, annulment or change in legal custody(including a qualified medical child support order as defined in section 609 of the Employee Retirement Income Security Act of 1974, as amended) that requires accident or health coverage for a Participant's child (including a foster child who is the Participant's Dependent), then the Participant may either (i) change his or her election under the PCP or Health FSA to provide coverage for the child, provided the order requires the Participant to provide coverage, or(ii)change his or her election under the PCP or Health FSA 15 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 40 of 549 Page 23 of 138 to revoke coverage for the child if the order requires the Participant's Spouse, former Spouse or another individual to provide coverage under that individual's plan and that coverage is actually provided. (d) Entitlement to Medicare or Medicaid If a Participant or his or her Spouse or Dependent who is enrolled in the PCP or Health FSA becomes enrolled in Medicare Part A or Part B or Medicaid, the Participant may prospectively elect to cancel the accident or health coverage(and the PCP premium conversion benefit for that coverage) of the individual who becomes enrolled in Medicare or Medicaid or the Participant's Health FSA coverage may be canceled. Despite the preceding sentence, a cancellation of Health FSA coverage will not become effective to the extent it would reduce future contributions to the Health FSA to a point where the total contributions for the Plan Year are less than the amount already reimbursed for the Plan Year. If a Participant or a Participant's Spouse or Dependent who has been enrolled in Medicare or Medicaid loses eligibility for such coverage, the Participant may make a prospective election to commence or increase the accident or health coverage for that individual or the Participant may elect to commence or increase his or her Health FSA coverage. (e) Change in Cost This subsection (e) applies to the PCP and, as limited below, the DCAP, but not the Health FSA. For purposes of this subsection (e), "similar coverage" means coverage for the same category of benefits for the same individuals (e.g., family to family or single to single). For example, two plans that provide major medical coverage are considered to be similar coverage. For purposes of this definition, (1) a health FSA is not similar coverage with respect to an accident or health plan that is not a health FSA; (2) an HMO and a PPO are considered to be similar coverage; and (3) coverage by another employer, such as a Spouse's or Dependent's employer, may be treated as similar coverage if it otherwise meets the requirements of similar coverage. (i) Automatic Changes. If the cost of a Participant's benefits under the PCP or DCAP insignificantly increases or decreases during a Period of Coverage, Participants are required to correspondingly increase or decrease their decrease their Salary Reduction contributions. The Plan Administrator will, in its sole discretion and on a uniform and 16 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 41 of 549 Page 24 of 138 consistent basis, determine whether an increase or decrease is insignificant based on all the surrounding facts and circumstances, including but not limited to the dollar amount or percentage of the cost change. The Plan Administrator will, on a reasonable and consistent basis, automatically effectuate this increase or decrease in affected Participants' Salary Reduction elections prospectively. (ii) Significant Cost Increases. If the Plan Administrator, in its sole discretion and on a uniform and consistent basis,determines in accordance with prevailing IRS guidance that the cost of a Participant's benefits under the PCP or DCAP significantly increases during a Period of Coverage, the Participant may: (a) Revoke his or her Salary Reduction election for that coverage and elect to receive coverage prospectively under another benefit option that provides similar coverage; (b) Revoke his or her Salary Reduction election and drop coverage if there is no other benefit option that provides similar coverage; or (c) Correspondingly elect to increase his or her Salary Reduction contributions prospectively. (iii) Significant Cost Decreases. If the Plan Administrator, in its sole discretion and on a uniform and consistent basis,determines in accordance with prevailing IRS guidance that the cost of a benefit under the PCP or DCAP significantly decreases during a Period of Coverage: (a) Participants who enrolled in another benefit may revoke their election and prospectively elect the benefit that has decreased in cost; (b) Employees who are otherwise eligible to participate in the Plan under Article II may prospectively elect the benefit that has decreased in cost, subject to the terms and limitations of the benefit; or (c) Participants enrolled in the benefit may prospectively elect to correspondingly decrease in their Salary Reduction contributions. (iv) Limitation on Change in Cost Provisions for DCAP. The preceding "change-in-cost" provisions apply to the DCAP only if the cost change is imposed by a 17 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 42 of 549 Page 25 of 138 dependent care provider who is not a"relative" of the Participant. For this purpose, "relative" means an individual who is related to the Participant as described in Code sections 152(d)(2)(A)through(G), incorporating the rules of Code sections 152(f)(1) and 152(f)(4). (f) Change in Coverage This subsection (f) applies to the PCP and the DCAP, but does not apply to the Health FSA. The definition of"similar coverage" under subsection (e) of this section applies to this subsection. (i) Significant Curtailment. If coverage is "significantly curtailed" (as defined below), Participants may elect coverage under another Plan benefit option that provides similar coverage. In addition, as set forth below, if the coverage curtailment results in a "loss of coverage" (as defined below), then Participants may drop coverage if no similar coverage is offered by the Employer. The Plan Administrator will, in its sole discretion and on a uniform and consistent basis, decide, in accordance with prevailing IRS guidance,whether a curtailment is "significant," and whether a loss of coverage has occurred. (a) Significant Curtailment Without Loss of Coverage. If the Plan Administrator determines that a Participant's or his or her Spouse's or Dependent's coverage under a plan is significantly curtailed without a loss of coverage during a Period of Coverage, the Participant may revoke his or her election for the affected coverage, and may prospectively elect coverage under another Plan benefit option that provides similar coverage (such as an HMO,but not the Health FSA). Coverage is"significantly curtailed"only if there is an overall reduction in coverage provided so as to constitute reduced coverage generally. (b) Significant Curtailment With Loss of Coverage. If the Plan Administrator determines that a Participant's or his or her Spouse's or Dependent's coverage under a plan is significantly curtailed, and if such curtailment results in a loss of coverage during a Period of Coverage, the Participant may elect to either: (1) Revoke his or her election for the affected coverage and prospectively elect coverage under another Plan benefit option that provides similar coverage (such as an HMO, but not the Health FSA); or 18 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 43 of 549 Page 26 of 138 (2) Prospectively drop coverage if no other Plan benefit option provides similar coverage. (c) Loss of Coverage. For purposes of this subsection (f), "loss of coverage" means a complete loss of coverage under the Plan benefit option (including the elimination of a benefits package option or an HMO ceasing to be available in the area where the individual resides). In addition, the Plan Administrator may, in its sole discretion and on a uniform and consistent basis, treat the following as a loss of coverage: (1) A substantial decrease in the medical care providers available under the Plan benefit option (such as a major hospital ceasing to be a member of a preferred provider network or a substantial decrease in the number of physicians participating in a PPO or HMO); (2) A reduction in the benefits for a specific type of medical condition or treatment with respect to which a Participant or his or her Spouse or Dependent is currently in a course of treatment; or (3) Any other similar fundamental loss of coverage. (d) Dependent Care Coverage Changes. A Participant may make a prospective election change that is on account of and corresponds with a change by the Participant in the dependent care service provider. For example: (1) if the Participant terminates one dependent care service provider and hires a new dependent care service provider, then the Participant may change coverage to reflect the cost of the new service provider; and (2) if the Participant terminates a dependent care service provider because a relative becomes available to take care of the child at no charge,then the Participant may cancel coverage. (ii) Addition or Significant Improvement of a Plan Benefit Option. If, during a Plan Year,the Employer adds a new Plan benefit option, or significantly improves an existing Plan benefit option: (a) Participants who are enrolled in a Plan benefit option other than the newly added or significantly improved Plan benefit option may revoke their elections of the Plan benefit option in which they are enrolled and prospectively elect the newly added or significantly improved Plan benefit option, or(b) Employees who are otherwise eligible to 19 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 44 of 549 Page 27 of 138 participate in the Plan under Article II may elect the newly added or significantly improved Plan benefit option on a prospective basis, subject to the terms and conditions of the Plan benefit option. The Plan Administrator will, in its sole discretion and on a uniform and consistent basis, decide whether there has been an addition of, or significant improvement in, a Plan benefit option in accordance with prevailing IRS guidance. (iii) Change in Coverage Under an Employer Plan. A Participant may make a prospective election change that is on account of and corresponds with a change made under another employer cafeteria plan or a qualified benefits plan(including a plan of the Employer or a plan of the Spouse's or Dependent's employer),but only if: (a) The other cafeteria plan or qualified benefits plan permits its participants to make an election change that would be permitted under Treasury regulations; or (b) This Plan permits Participants to make an election for a Period of Coverage that is different from the period of coverage under the other cafeteria plan or qualified benefits plan. (iv) Loss of Other Group Health Coverage. If a Participant or his or her Spouse or Dependent loses coverage under any group health coverage sponsored by a governmental or educational institution during a Period of Coverage, the Participant may prospectively change his or her election to add group health coverage for the individual who loses coverage. (g) FMLA Leave of Absence A Participant taking leave of absence under the FMLA,may revoke an existing election of group health plan coverage under a Component Plan and may make such other election for the remaining portion of the Plan Year as may be provided for under the FMLA. 20 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 45 of 549 Page 28 of 138 (h) Other Circumstances Any other event approved by the Plan Administrator in a nondiscriminatory manner which are consistent with regulations or other guidance issued by the Secretary of the Treasury. 3.7 Limit on Amount Credited to DCAP Subaccount The amount credited to a Participant's DCAP Subaccount must not exceed the maximum limit as stated in Section 4.6 of the DCAP. 3.8 Limit on Amount Credited to Health FSA Subaccount The annual amount credited to a Participant's Health FSA Subaccount must not exceed the maximum limit stated in Section 4.6 of the Employer Health FSA. 3.9 Limit on Amount Credited to PCP Subaccount The annual amount credited to a Participant's PCP Subaccount must not exceed, the maximum limit stated in Section 5.3 of the PCP. 3.10 Plan Administrator's Power to Modify and Suspend Elections The Plan Administrator may,at any time,require any Participant or class of Participants to amend the amount of their Salary Reductions for a Period of Coverage if the Plan Administrator determines that such action is necessary or advisable in order to (a) satisfy any of the Code's nondiscrimination requirements applicable to this Plan, a Component Plan, or other cafeteria plan; (b)prevent any Employee or class of Employees from having to recognize more income for federal income tax purposes from the receipt of benefits hereunder than would otherwise be recognized; (c) maintain the qualified status of benefits received under this Plan; or (d) satisfy Code nondiscrimination requirements or other limitations applicable to the Employer's qualified plans. In the event that contributions need to be reduced for a class of Participants, the Plan Administrator will reduce the Salary Reduction amounts for each affected Participant, beginning with the Participant in the class who had elected the highest Salary Reduction amount and continuing with the Participant in the class who had elected the next-highest Salary Reduction amount, and so forth,until the defect is corrected. Despite any contrary Plan provision, the Plan Administrator will suspend, modify, or terminate any Participant's elections under the following circumstances: 21 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 46 of 549 Page 29 of 138 (a) If the amount of any reduction agreed to is greater than the Participant's monthly taxable pay from the Employer. (b) In compliance with a change or revocation of an election due to a permitted election-change event under Section 3.6. 22 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 47 of 549 Page 30 of 138 ARTICLE IV: BENEFITS 4.1 General Rule All Component Plan benefits, except Health FSA benefits,will be payable or provided under this article for a Plan Year only with respect to periods during such Plan Year in which an Eligible Employee is a Participant and has or is entitled to have amounts credited to his or her account pursuant to Sections 3.2 and 3.3,and expenses shall be reimbursed only if incurred during such periods. 4.2 Health FSA Health FSA benefits will be payable in accordance with Article V of the Health FSA. 4.3 Dependent Care Expenses Amounts credited to a Participant's DCAP Subaccount for a Plan Year will be payable in accordance with Section 5.1 of the DCAP. 4.4 Premium Expenses Amounts credited to a Participant's PCP Subaccount for a Plan Year will be payable in accordance with Section 5.2 of the PCP. 4.5 Cash Benefits (a) A Participant (except a Board member) may elect to receive in cash, included in his or her paycheck, Employer Credits (to the extent permitted in Section 3.2), or amounts that could otherwise be subject to Salary Reduction. Such benefits will be treated as cash under this Plan and reported on the Participant's Form W-2 as wages and will be subject to payroll income and employment tax withholding. (b) If a Participant elects Salary Reductions,but fails to elect any benefits provided in Sections 4.2, 4.3, or 4.4, the Participant's Salary Reduction election will be ineffective, and the Participant will receive the amounts that would have otherwise been subject to Salary Reduction in the form of taxable wages instead of having those amounts credited to his or her Subaccounts. 23 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 48 of 549 Page 31 of 138 ARTICLE V: PLAN ADMINISTRATION 5.1 Plan Administrator The Plan Administrator is the Administrative Committee,which is comprised of at least two members each of whom is appointed by, and serves at the pleasure of, the Board. The Committee will supervise the administration of the Plan and each Component Plan. The Plan Administrator's principal duty is to see that this Plan and the Component Plans are carried out in accordance with their terms for the exclusive benefit of individuals entitled to participate in the Plan without discriminating among them. 5.2 Plan Administrator's Powers and Duties The Plan Administrator will have such powers as it considers necessary or appropriate to discharge its duties under the Plan and the Component Plans. The Plan Administrator will have the complete and exclusive right and discretion to interpret the Plan and the Component Plans and to decide all matters thereunder, and all determinations of the Plan Administrator will be conclusive and binding on all persons. The Plan Administer will have all of the powers and duties necessary or appropriate to administer the Plan and the Component Plans in all their details, including without limitation the power to: (a) Construe and interpret the Plan and the Component Plans,including all possible ambiguities, inconsistencies, and omissions in the Plan, the Component Plans, and related documents,and to decide all questions of fact,questions relating to eligibility and participation, and questions of benefits under this Plan, such good faith interpretations to be final and conclusive on all persons; (b) Adopt and prescribe such procedures and regulations and forms to be used by Employees and Participants to make elections under the Plan and the Component Plans as the Committee believes in its sole discretion are necessary or appropriate for the proper and efficient administration, and consistent with the terms and purposes, of the Plan and the Component Plans; (c) Enforce the Plan and the Component Plans according to their terms and the procedures and regulations adopted by the Administrative Committee; 24 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 49 of 549 Page 32 of 138 (d) Appoint or employ other persons (who may be the Employer's employees, and who may include legal counsel and benefit consultants), and to delegate in writing to such other persons any of the Plan Administrator's specific responsibilities,including responsibility for day-to-day Plan administration, to assist it in administering the Plan and the Component Plans; (e) Prepare and distribute information explaining the Plan and the Component Plans and the benefits thereunder in such manner as the Plan Administrator determines in its sole discretion to be necessary or appropriate; (f) Request and receive from all Employees and Participants such information as the Plan Administrator determines in its sole discretion to be necessary or appropriate for the proper administration of the Plan and the Component Plans; (g) Prepare, report, file and disclose any forms, documents or other information required by law to be reported or filed with any governmental agency, or to be disclosed to Participants or other persons entitled to benefits under the Plan; (h) Review, decide, and respond to benefit claims and appeals under the Plan and the Component Plans; (i) Furnish each Employee and Participant with such reports with respect to the administration of the Plan and the Component Plans as the Plan Administrator determines from time to time in its sole discretion to be reasonable and appropriate, including but not limited to appropriate statements setting forth the amount of a Participant's Salary Reductions and the amounts available to pay benefits under the Plan and the Component Plans; 0) Receive, review, and keep on file such reports and information regarding the benefits covered by the Plan and the Component Plans as the Plan Administrator determines from time to time in its sole discretion to be necessary or appropriate; (k) Sign documents for the purposes of administering the Plan and the Component Plans, or to designate an individual or individuals to sign documents for the purposes of administering the Plan or the Component Plans; (1) Secure independent medical or other advice and require such evidence as it deems necessary to decide any claim or appeal; and 25 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 50 of 549 Page 33 of 138 (m) Maintain the books of accounts,records,and other data in the manner necessary for proper administration of this Plan and the Component Plans and to meet any applicable disclosure and reporting requirements. 5.3 General Plan Administration The Plan Administrator has delegated responsibility for the day-to-day administration of the Plan to the Employer's human resources personnel, except to the extent contractually delegated to a third-party administrator appointed by the Plan Administrator or the Employer. This includes: (a) Notifying Eligible Employees of their eligibility to participate in the Plan and in the Component Plans; (b) Furnishing Plan enrollment materials and forms and claim forms to Eligible Employees; (c) Determining Employees' eligibility to participate in the Plan and in the Component Plans; (d) Developing and recommending to the Plan Administrator procedures and regulations necessary or appropriate for the proper and efficient administration, and consistent with the terms and purposes, of the Plan and the Component Plans; (e) Receiving, deciding, and maintaining records of initial benefit claims; (f) Filing or disclosing any information required by law to be filed with any governmental agency or disclosed to employees or other persons entitled to benefits under the plan; and (g) Administering other day-to-day Plan and Component Plan operations in accordance with the plans' terms and the procedures and regulations adopted by the Plan Administrator or the Employer. 5.4 Reliance on Information Furnished by Others The Plan Administrator or its delegates may rely on the direction, information, or election of a Participant as being proper under the Plan and will not be responsible for any act or omission due to a Participant's direction or lack thereof. The Plan Administrator or its 26 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 51 of 549 Page 34 of 138 delegates will also be entitled,to the extent allowed by applicable law,to rely conclusively on all tables, valuations, certificates, opinions, reports and other information furnished by the Employer, actuaries, accountants, attorneys or other experts employed or engaged by the Plan Administrator or the Employer. 5.5 Indemnification by Employ To the extent permitted by applicable law, the Employer agrees to indemnify and reimburse all Board members, Administrative Committee members, and the Employer's employees who perform any plan administration functions, for all expenses, losses, and liabilities arising from any act or omission in the management of the Plan, except expenses, losses, and liabilities resulting from such persons' gross negligence or willful misconduct. The Employer may self insure or purchase insurance for all Plan fiduciaries employed by the Employer— and for all persons who are trustees, employees, officers, or agents of the Employer — to cover the potential liability of those persons with respect to their actions or omissions concerning this Plan or the Component Plans. 5.6 Discretionary Power of Plan Administrator All discretion conferred upon the Plan Administrator will be absolute. However, no discretionary power conferred on the Plan Administrator will be exercised in a manner that causes discrimination prohibited by the Code or the Treasury regulations. The Plan Administrator will exercise its discretionary power in a non-discriminatory manner with regard to all similarly situated Employees or Participants. 5.7 Compensation of Plan Administrator Unless otherwise determined by the Employer and permitted by applicable law, any Plan Administrator that is also an Employee of the Employer will serve without compensation for services rendered in such capacity,but all reasonable expenses incurred in the performance of their duties will be paid by the Employer. 5.8 Inability to Locate Pam If the Plan Administrator is unable to make payment to any Participant or other person to whom a payment is due under the Plan because it cannot ascertain the identity or 27 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 52 of 549 Page 35 of 138 whereabouts of such Participant or other person after reasonable efforts have been made to identify or locate such person, then such payment and all subsequent payments otherwise due to such Participant or other person will be forfeited following a reasonable time after the date any such payment first became due. 28 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 53 of 549 Page 36 of 138 ARTICLE VI: CLAIMS PROCEDURES 6.1 Claim Procedures The Plan Administrator or its delegate(further references to Plan Administrator in this section include its delegate) must notify each Eligible Employee of his or her entitlement to receive benefits under this Plan and shall provide each Eligible Employee with appropriate benefit application forms. Each individual claiming a benefit under the Plan or a Component Plan or his or her authorized representative ("Claimant") must complete and file such benefit application forms with the Plan Administrator to make a benefit claim. The Plan Administrator must review all benefit claims. The Plan Administrator notify the Claimant in writing of its decision on the claim within 30 days of receipt of the application. If special circumstances require any extension of time(not to exceed 15 days)for processing the claim,the Plan Administrator must notify the claimant in writing of the extension prior to the expiration of the initial 30-day period. The Plan Administrator's denial of a benefit claim must be stated in writing and mailed to the Claimant. The denial notice must state clearly in language calculated to be understood by the Claimant: (a) The specific reason or reasons for the Plan Administrator's decision; (b) References to the pertinent Plan or Component Plan provisions; (c) The additional material or information the Participant must provide to enable the Plan Administrator to reconsider the claim on appeal; and (d) The Plan's appeal procedures. 6.2 Appeal Procedure To appeal a denied claim, a Claimant must submit a written appeal of the denied claim to the Director of Administration within 180 days after receipt of the denial notice.A Claimant may also submit a written comments documents,records and other information and comments relating to the claim and, upon request, have reasonable access to copies of all documents, records,and other information relevant to the claim. The appropriate Plan fiduciary will,within 29 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 54 of 549 Page 37 of 138 30 days after receipt the request, make that information available to the Claimant at a convenient location during regular business hours. The appropriate Plan fiduciary(one that did not decide the original claim)must review and decide the Claimant's appeal in a reasonable time, but not later than 60 days after he or she receives the appeal, unless special circumstances require an extension of time for processing. If special circumstances require an extension of time, the appropriate Plan fiduciary will provide written notice of the extension to the Claimant before the end of the original 60-day period, and a decision shall be rendered as soon as possible, but not later than 120 days after receipt of the appeal. If the appropriate Plan fiduciary denies the appeal, it must notify the Claimant in writing of its decision in writing by certified mail within 60 (120 if written notice of extension has been given) days of receipt of the appeal. The notice must be written in a manner calculated to be understood by the Claimant and include: (a) the specific reason or reasons for the denial, and(b) reference to the specific Plan provisions on which the denial is based. The decision of the appropriate Plan fiduciary will be final. 6.3 Agent for Service of Process The agent for service of process for the Plan is: Secretary of the District Central Contra Costa Sanitary District 5019 Imhoff Place Martinez, CA 94553 6.4 Notices Notices and documents relating to the Plan may be delivered, or mailed by registered mail, postage prepaid, to the Administrative Committee in care of the Finance Manager, Central Contra Costa Sanitary District, 5019 Imhoff Place, Martinez, CA 94553. Any notice required under the Plan may be waived by the person entitled to notice. 6.5 Evidence Evidence required of anyone under the Plan may be by certificate, affidavit, document or other information which the person acting on it considers pertinent and reliable. The evidence may be signed, made or presented by the proper party or parties. 30 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 55 of 549 Page 38 of 138 ARTICLE VII: MISCELLANEOUS 7.1 Component Plans Control The detailed coverages provided under each Component Plan are set forth in the Component Plan; in case of any conflict between the terms of this Plan and the terms of a Component Plan, the terms of the Component Plan will control. Evidences of Coverage or summaries setting forth the details of the coverages provided under the Component Plans will be distributed to Eligible Employees enrolled under the Component Plans. 7.2 Governing Law Except to the extent preempted by federal law,this Plan and each Component Plan and all rights and duties thereunder shall be governed, construed, and administered in accordance with the laws of the State of California. 7.3 Severability If any provision of the Plan or a Component Plan is held invalid or unenforceable, its invalidity or unenforceability shall not affect any other provisions of the Plan or Component Plan, and the Plan or Component Plan will be construed and enforced as if such provision had not been included herein. 7.4 Plan Not An Employment Contract Neither this Plan nor any of the Component Plans is intended to be or will be construed as constituting a contract or other arrangement between any Employee and the Employer to the effect that such Employee will be employed for a specific period of time. 7.5 Non-Assi_ng ability of Rights Except as otherwise expressly permitted by a Component Plan, the right of any person entitled to benefits under a Component Plan will not be subject to their debts or other obligations and, except as may be required by the tax withholding provisions of the Code or any state's tax laws, may not be voluntarily or involuntarily sold, transferred, alienated, assigned, or encumbered. Any attempt to do so will not be recognized, except to the extent expressly permitted by a Component Plan or required by applicable law. 31 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 56 of 549 Page 39 of 138 7.6 Facility of Pam When any person entitled to benefits under the Plan or Component Plan is under legal disability or in the Employer's opinion is in any way incapacitated so as to be unable to manage his affairs, the Employer may cause such person's benefits to be paid to such person's legal representative for his benefit,or to be applied for the benefit of such person in any other manner that the Employer may determine. 7.7 Mistake In the event of a mistake as to the eligibility or participation of an Employee, the allocations made to the account of any Participant, or the amount of benefits paid or to be paid to a Participant or other person, the Plan Administrator will, to the extent it deems administratively possible and permitted under applicable law, allocate,withhold, or otherwise adjust amounts that in its judgement will provide the Participant or other person the credits or distributions he or she is properly entitled to under the Plan or Component Plan. made by reason thereof. The Employer will not be liable in any manner for any mistake that results from a determination of fact made in good faith. 7.8 Expenses All reasonable expenses incurred in administering the Plan and the Component Plans are currently paid by forfeitures to the extent provided in Section 5.3 of the Health FSA with respect to Health FSA benefits and Section 5.3 of the DCAP with respect to DCAP benefits, and then by the Employer. 7.9 Compliance With Code and Other Applicable Laws This Plan and the Component Plans are intended to meet all applicable requirements of the Code and of all Treasury regulations issued thereunder.This Plan and the Component Plans will be construed, operated, and administered accordingly, and in the event of any conflict between any part, clause, or provision of this Plan or the Component Plans and the Code, the provisions of the Code will be deemed controlling, and any conflicting part, clause, or provision of this Plan or the Component Plans will be deemed superseded to the extent of the conflict. In addition, the Plan and the Component Plans will comply with the requirements of all other applicable laws. 32 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 57 of 549 Page 40 of 138 7.10 No Guarantee of Tax Consequences Neither the Plan Administrator nor the Employer makes any commitment or guarantee that any amounts paid to or for the benefit of a Participant under this Plan or a Component Plan will be excludable from the Participant's gross income for federal, state, or local income tax purposes.It will be the obligation of each Participant to determine whether each payment under this Plan is excludable from the Participant's gross income for federal, state, and local income tax purposes and to notify the Plan Administrator if the Participant has any reason to believe that such payment is not so excludable. 7.11 Insurance Contracts The Employer will have the right to(a)enter into a contract with one or more insurance companies for the purposes of providing benefits under the Plan or a Component Plan, and(b) to replace any of such insurance contracts.Any dividends,retroactive rate adjustments,or other refunds of any type that may become payable under any such insurance contract will not be assets of the Plan or Component Plan, but will be the property of and be retained by the Employer, to the extent permitted under applicable law. 33 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 58 of 549 Page 41 of 138 ARTICLE VIII: AMENDMENT AND TERMINATION 8.1 Amendment The Employer may, subject to any applicable legal requirement to meet and confer with employee representatives,amend all or any part of the Plan or any Component Plan at any time or from time to time and for any reason by resolution of the Board or by an person or persons authorized by the Board to take such action. 8.2 Termination The employer may, subject to any applicable legal requirement to meet and confer with employee representatives, terminate the Plan or any Component Plan, in whole or in part, at any time and for any reason by resolution of the Board or by an person or persons authorized by the Board to take such action. No termination shall operate to reduce the amount of any benefit payment otherwise payable under the Plan or Component Plan for charges incurred prior to the effective date of such termination. 34 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 59 of 549 Page 42 of 138 ARTICLE IX: EXECUTION As evidence of its adoption of this amendment and restatement of the Plan, the Central Contra Costa Sanitary District has caused this instrument to be signed by its duly authorized officers on this day of , 2019. By: President, Board of Directors For: THE CENTRAL CONTRA COSTA SANITARY DISTRICT ATTEST: By: (Sign Name) Date Katie Young, Secretary of the District (Print Name and Title) 35 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 60 of 549 Page 43 of 138 APPENDIX A Component Plans To Central Contra Costa Sanitary District Section 125 Cafeteria Plan As of the Effective Date, the following are the Component Plans included in the Plan: 1. The Central Contra Costa Sanitary District Health Flexible Spending Arrangement Plan 2. The Central Contra Costa Sanitary District Dependent Care Assistance Plan 3. The Central Contra Costa Sanitary District Premium Conversion Plan A-1 15390111.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 61 of 549 Page 44 of 138 ATTACHMENT 2 CENTRAL CONTRA COSTA SANITARY DISTRICT PREMIUM CONVERSION PLAN (A Component Plan of the Central Contra Costa Sanitary District Section 125 Cafeteria Plan) Amended and Restated Effective July 1, 2019 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 62 of 549 Page 45 of 138 TABLE OF CONTENTS Page INTRODUCTION ...........................................................................................................................2 ARTICLE 1: DEFINITIONS ...........................................................................................................3 ARTICLE 11: SCOPE OF THE PLAN............................................................................................5 ARTICLE III: ELIGIBILITY AND PLAN PARTICIPATION......................................................6 ARTICLE IV: PLAN FUNDING....................................................................................................8 ARTICLE V: BENEFITS..............................................................................................................10 ARTICLE VI: GENERAL PROVISIONS....................................................................................12 ARTICLE VII: EXECUTION.......................................................................................................13 APPENDIXA............................................................................................................................. A-1 i 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 63 of 549 Page 46 of 138 CENTRAL CONTRA COSTA SANITARY DISTRICT PREMIUM CONVERSION PLAN INTRODUCTION Effective as of July 1, 2019, the Central Contra Costa Sanitary District (the "Employer") hereby amends and restates the Central Contra Costa Sanitary District Premium Conversion Plan (the "Premium Conversion Plan") to allow Eligible Employees of the Employer to elect to pay their share of the cost of the Employer Group Health Plans on a pre-tax basis, as provided herein and in accordance with the terms of the Central Contra Costa Sanitary District Section 125 Cafeteria Plan (the "Section 125 Plan"). The Employer originally adopted the Section 125 Plan effective May 1, 1989. The Employer most recently amended and restated the Plan effective January 1998. This Premium Conversion Plan is a Component Plan of the Section 125 Plan and, except to the extent otherwise expressly provided herein, is governed by the rules and regulations of the Section 125 Plan. The Premium Conversion Plan is intended to convert employee premiums to employer paid premiums within the meaning of Section 106(b) of the Code and to meet the requirements of any other provisions of applicable law. Appendix A, Employer Group Health Plans, attached to this Premium Conversion Plan is incorporated herein by reference and is a part hereof and may be amended without necessity for other amendment to this Premium Conversion Plan. 2 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 64 of 549 Page 47 of 138 ARTICLE I: DEFINITIONS The definitions in the Section 125 Plan apply to this Component Plan as well as the following definitions specific to the Premium Conversion Plan: 1.1 Dependent An individual who with respect to the Participant is: (a) a dependent as defined in Code section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof; (b) a child(as defined in Code section 152(f)(1))who as of the end of the calendar year has not attained age 27;and(c)a child to whom Code section 152(e)applies(regarding certain children of divorced or separated parents who receive more than half of their support for the calendar year from one or both parents and are in the custody of one or both parents for more than half of the calendar year). 1.2 Effective Date July 1, 2019, the date this amendment and restatement of the Plan is effective. 1.3 Eligible Premium Expense A premium or other amount an Eligible Employee must pay for coverage under an Employer Group Health Plan. 1.4 Employer Group Health Plan A plan that the Employer maintains for Employees and their eligible dependents, which provides health benefits through a group insurance policy or self-funded benefit plan (e.g., medical, dental and vision benefits). The Employer Group Health Plans currently maintained by the Employer are listed in Appendix A. The Employer may substitute, add, subtract, or revise the menu of such plans or the benefits, terms and conditions of any such plans at any time. Any such substitution, addition, subtraction or revision will be communicated to Participants and will automatically be incorporated by reference under the Premium Conversion Plan. The Employer may amend Appendix A without necessity for any other amendment to this Premium Conversion Plan. The operation of each Employer Group Health Plan will be governed by the terms of the Employer Group Health Plan and, in the event of a conflict between those terms and the terms of the Premium Conversion Plan or the Section 125 Plan, the terms of the Employer Group Health Plan will govern. 3 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 65 of 549 Page 48 of 138 1.5 Participant An individual who has met the eligibility requirements under Section 3.1, elected to participate in accordance with Section 3.2, and whose participation has not terminated under Section 3.3. 1.6 Section 125 Plan The Central Contra Costa Sanitary District Section 125 Cafeteria Plan, as amended. 4 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 66 of 549 Page 49 of 138 ARTICLE II: SCOPE OF THE PLAN Subject to the conditions and limitations set forth in this Premium Conversion Plan and in the Section 125 Plan, each Participant will have his or her share of Eligible Premium Expenses paid under the Premium Conversion Plan in lieu of an equal amount of Compensation. 5 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 67 of 549 Page 50 of 138 ARTICLE III: ELIGIBILITY AND PLAN PARTICIPATION 3.1 Commencement of Participation Each Participant in the Premium Conversion Plan as in effect before the Effective Date who has not elected to terminate coverage under the Premium Conversion Plan will remain a Participant. On and after that date, an individual will become a Participant in the Premium Conversion Plan on the first day of the month after her or she becomes an Eligible Employee or, if later, when he or she makes a timely election to participate in the Premium Conversion Plan in accordance with Article III of the Section 125 Plan. 3.2 Election to Participate _Subject to the conditions and limitations set forth in the Premium Conversion Plan and the Section 125 Plan,each Eligible Employee may elect to have his or her Eligible Premium Expenses paid under the Premium Conversion Plan in lieu of an equal amount of Compensation.An Eligible Employee can elect to participate in the Premium Conversion Plan by electing (a) to receive benefits under the Employer Group Health Plans described in Appendix A; and (b) to pay for his or her share of the contributions for those benefits on a pre-tax Salary Reduction basis or with Employer Credits. Unless an exception applies (as described in Section 3.6 of the Section 125 Plan), the election is irrevocable for the duration of the Period of Coverage to which it relates. Despite any contrary Premium Conversion Plan provision, benefits under the Employer Group Health Plans are subject to the terms and conditions of the Group Health Plans, and no changes can be made with respect to such plans (such as mid-year changes in election) if such changes are not permitted under the applicable Employer Group Health Plan. 3.3 Termination of Participation A Participant's participation in the Premium Conversion Plan will terminate upon the earliest of: (a) the termination of the Premium Conversion Plan or the Section 125 Plan; (b) the Participant's permitted election not to participate in the Premium Conversion Plan; or (c) the Participant ceases to be an Eligible Employee. 6 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 68 of 549 Page 51 of 138 Termination of participation in this Premium Conversion Plan will automatically revoke the Participant's elections. Benefits under any Group Health Plan will terminate as of the date(s) specified in the Group Health Plan. If revocation occurs under this Section 3.3, no new election may be made by such Participant during the remainder of the Plan Year unless otherwise permitted under the Plan. 3.4 Resumption of Participation A former Participant's participation in the Premium Conversion Plan will be reinstated in accordance with Section 2.3 of the Section 125 Plan. 3.5 Leaves of Absence See Sections 2.4 and 2.5 of the Section 125 Plan for rules regarding the effect of a leave of absence on a Participant's participation in the Premium Conversion Plan. 7 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 69 of 549 Page 52 of 138 ARTICLE IV: PLAN FUNDING 4.1 Establishment of Accounts Section 3.1 of the Section 125 Plan,which provides for the establishment of Accounts and Subaccounts, will also apply to the Premium Conversion Plan. 4.2 Employer Credits Each Eligible Employee may, in accordance with Article III of the Section 125 Plan, elect to apply any Employer Credits to his or her Account under Section 3.2 of the Section 125 Plan to pay Eligible Premium Expenses under the Premium Conversion Plan. 4.3 Salary Reduction Credits Each Eligible Employee may, in accordance with Article III of the Section 125 Plan, make a timely written Salary Reduction election to have his or her annual Compensation reduced, but not below zero, by all or a portion of the Eligible Premium Expense he or she is required to pay for coverage under the Employer Group Health Plan(s). The amount of Salary Reduction will be credited to the Participant's PCP Subaccount until it is paid out for such coverage. The amount of the Salary Reduction contribution for a Participant's portion of the Eligible Premium Expense is equal to the amount set forth by the Employer in the annual enrollment materials. In the event an Eligible Employee fails to timely elect to participate in the Premium Conversion Plan, he or she will receive his or her Compensation without any reduction for the Premium Conversion Plan, and will be required to pay any required Eligible Premium Expense through after-tax payroll withholding. 4.4 Time for Making Elections The timing of an Eligible Employee's Salary Reduction election to participate in the Premium Conversion Plan is governed by Section 3.5 of the Section 125 Plan. 4.5 Change or Revocation of Elections A Participant's Salary Reduction election for any Period of Coverage may not be changed or revoked after the first payroll period to which it applies, except under the circumstances described in Section 3.6 of the Section 125 Plan. 8 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 70 of 549 Page 53 of 138 4.6 Plan Administrator's Power to Modify or Suspend Elections Section 3.10 of the Section 125 Plan,which describes the circumstances in which the Plan Administrator has the power to modify or suspend Salary Reductions, will also apply to this Premium Conversion Plan. 9 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 71 of 549 Page 54 of 138 ARTICLE V: BENEFITS 5.1 General Rule Section 4.1 of the Section 125 Plan document will also apply to this Premium Conversion Plan. 5.2 Eligible Premium Expenses Amounts credited to a Participant's PCP Subaccount will be applied to pay the amount of any Eligible Premium Expense for Employer Group Health Plan coverage for the Participant and his or her Spouse and Dependents otherwise payable by the Participant during the Period of Coverage under the applicable Employer Group Health Plan. 5.3 Limit on the Amount Credited to the PCP Subaccount The annual amount credited to a Participant's PCP Subaccount must not exceed the total of all Eligible Premium Expenses under all Employer Group Health Plans covering the Participant and his or her Spouse and Dependents for the Period of Coverage. 5.4 Benefits Provided Under the Employer Group Health Plans Group health benefits will be provided by the Employer Group Health Plans in accordance with their governing documents, and not this Plan. The types and amounts of benefits, the requirements for participating in the Employer Group Health Plans, and the other terms and conditions of coverage and benefits of such plans are set forth in their governing documents. All claims to receive benefits under the Employer Group Health Plans will be subject to and governed by the terms and conditions of the Employer Group Health Plans and the rules, regulations, policies, and procedures adopted in accordance with those plans, as may be amended from time to time. 5.5 Group Health Benefits; COBRA Notwithstanding any provision to the contrary in this Plan, to the extent required by COBRA,a Participant and his or her Spouse and Dependents,as applicable,whose health coverage terminates under an Employer Group Health Plan because of a COBRA qualifying event(and who is a qualified beneficiary as defined under COBRA), will be given the opportunity to continue on a self-pay basis the same health coverage that he or she had under the applicable Employer Group 10 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 72 of 549 Page 55 of 138 Health Plan the day before the qualifying event for the periods prescribed by COBRA. Such continuation coverage will be subject to all conditions and limitations under COBRA. Contributions for COBRA coverage under an Employer Group Health Plan may be paid on a pre-tax basis for current Employees receiving taxable compensation(as may be permitted by the Plan Administrator on a uniform and consistent basis, but may not be prepaid from contributions in one Plan Year to provide coverage that extends into a subsequent Plan Year)where COBRA coverage arises either (a) because the Employee ceases to be eligible because of a reduction in hours; or (b) because the Employee's Dependent ceases to satisfy the eligibility requirements for coverage. For all other individuals (e.g., Employees who cease to be eligible because of retirement, termination of employment, or layoff), contributions for COBRA coverage for Employer Group Health Plan benefits will be paid on an after-tax basis (unless as may be otherwise permitted by the Plan Administrator on a uniform and consistent basis, but may not be prepaid from contributions in one Plan Year to provide coverage that extends into a subsequent Plan Year). 11 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 73 of 549 Page 56 of 138 ARTICLE VI: GENERAL PROVISIONS 6.1 Administration of the Premium Conversion Plan The Premium Conversion Plan will be administered in accordance with the provisions set forth in Article V of the Section 125 Plan. 6.2 Claims Procedures The claims and appeals procedures set forth in Article VI of the Section 125 Plan will also apply to this Premium Conversion Plan,provided that the claims for Employer Group Health Plan benefits will be administered in accordance with and claims procedures for the Employer Group Health Plans as set forth in their governing plan documents. 6.3 Miscellaneous Provisions The miscellaneous provisions described in Article VII of the Section 125 Plan will also apply to this Premium Conversion Plan. 6.4 Amendment and Termination Subject to Article VIII of the Section 125 Plan,the Employer may amend or terminate this Premium Conversion Plan in whole or in part at any time and for any reason by resolution of the Board or by any person or persons authorized by the Board to take such action. 12 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 74 of 549 Page 57 of 138 ARTICLE VII: EXECUTION As evidence of its amendment of this amendment and restatement of the Premium Conversion Plan,the Central Contra Costa Sanitary District has caused this instrument to be signed by its duly authorized officers on this day of 92019. By: President, Board of Directors (Date) For: THE CENTRAL CONTRA COSTA SANITARY DISTRICT ATTEST: By: (Sign Name) Date Katie Young, Secretary of the District (Print Name and Title) 13 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 75 of 549 Page 58 of 138 APPENDIX A Employer Group Health Plans To the Central Contra Costa Sanitary District Premium Conversion Plan As of the Effective Date, the following Employer Group Health Plans are offered under the Premium Conversion Plan: 1. Health Insurance under the Public Employees' Medical and Hospital Care Act ("CalPERS Health") A-1 15398339.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 76 of 549 Page 59 of 138 ATTACHMENT 3 CENTRAL CONTRA COSTA SANITARY DISTRICT HEALTH FLEXIBLE SPENDING ARRANGEMENT PLAN (A Component Plan of the Central Contra Costa Sanitary District Section 125 Cafeteria Plan) Amended and Restated Effective July 1, 2019 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 77 of 549 Page 60 of 138 TABLE OF CONTENTS Page INTRODUCTION...........................................................................................................................1 ARTICLE I: DEFINITIONS ...........................................................................................................2 1.1 Dependent................................................................................................................2 1.2 Effective Date..........................................................................................................2 1.3 Eligible Medical Expense........................................................................................2 1.4 Grace Period.............................................................................................................3 1.5 Health FSA...............................................................................................................3 1.6 Health FSA Subaccount...........................................................................................3 1.7 HIPAA.....................................................................................................................3 1.8 Participant................................................................................................................3 1.9 Run-Out Period........................................................................................................3 1.10 Section 125 Plan ......................................................................................................3 ARTICLE II: SCOPE OF THE PLAN............................................................................................4 ARTICLE III: ELIGIBILITY AND PLAN PARTICIPATION......................................................5 3.1 Eligibility to Participate...........................................................................................5 3.2 Election to Participate..............................................................................................5 3.3 Termination of Participation....................................................................................5 3.4 Resumption of Participation ....................................................................................6 3.5 Leaves of Absence...................................................................................................6 ARTICLE IV: PLAN FUNDING....................................................................................................7 4.1 Establishment of Accounts ......................................................................................7 4.2 Employer Credits.....................................................................................................7 4.3 Salary Reduction Credits.........................................................................................8 4.4 Time for Making Salary Reduction Elections .........................................................8 4.5 Change or Revocation of Elections..........................................................................8 4.6 Limit on Amount Credited to Health FSA...............................................................8 4.7 Plan Administrator's Power to Modify Elections....................................................8 ARTICLE V: BENEFITS................................................................................................................9 5.1 Health Care Reimbursement....................................................................................9 5.2 Maximum Reimbursement Available; Uniform Coverage......................................9 5.3 Forfeitures................................................................................................................9 i 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 78 of 549 Page 61 of 138 5.4 Grace Period...........................................................................................................10 5.5 Receiving Health Care Reimbursement.................................................................1 l ARTICLE VI: POST-PARTICIPATION REIMBURSEMENTS; COBRA.................................12 6.1 General Rule ..........................................................................................................12 6.2 COBRA Continuation Coverage............................................................................12 ARTICLE VII: CLAIMS PROCEDURES....................................................................................14 7.1 General Reimbursement Procedures......................................................................14 7.2 Substantiation of Expenses....................................................................................14 7.3 Claims and Appeals Procedures.............................................................................15 ARTICLE VIII: GENERAL PROVISIONS .................................................................................16 8.1 Administration of the Health FSA.........................................................................16 8.2 Miscellaneous Provisions.......................................................................................16 8.3 Amendment and Termination of the Health FSA..................................................16 8.4 Coordination of Benefits Under the Health FSA...................................................16 8.5 HIPAA Compliance...............................................................................................16 ARTICLE IX: EXECUTION ........................................................................................................17 APPENDIXA ........................................................................................................................A-1 APPENDIXB .........................................................................................................................B-1 ii 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 79 of 549 Page 62 of 138 CENTRAL CONTRA COSTA SANITARY DISTRICT HEALTH FLEXIBLE SPENDING ARRANGEMENT PLAN INTRODUCTION The Central Contra Costa Sanitary District (the "Employer") hereby amends and restates the Central Contra Costa Sanitary District Health Flexible Spending Arrangement Plan (the "Health FSA") effective July 1, 2019. The Health FSA is intended to qualify as a self-insured medical reimbursement plan under section 105(b) of the Internal Revenue Code of 1986, as amended (the "Code"), and is to be interpreted in a manner consistent with the requirements of section 105(b). The purpose of the Health FSA is to allow Eligible Employees of the Employer to elect to receive health care reimbursement benefits for medical care as defined in section 213(d) of the Code which are excludable from gross income under section 105(b)of the Code as provided herein and in accordance with the terms of the Central Contra Costa Sanitary District Section 125 Cafeteria Plan(the"Section 125 Plan").The Employer originally adopted the Health FSA effective May 1, 1989. Since then, the Employer has amended the Health FSA on various occasions. The Employer most recently amended and restated the Health FSA effective January 1, 2013. This Health FSA is a Component Plan of the Section 125 Plan and, except to the extent otherwise expressly provided herein, is governed by the rules and regulations of the Section 125 Plan. 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 80 of 549 Page 63 of 138 ARTICLE I: DEFINITIONS The definitions in the Section 125 Plan apply to this Component Plan as well as the following definitions specific to the Health FSA: 1.1 Dependent An individual who with respect to the Participant is (a) a dependent as defined in Code section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof; (b) a child(as defined in Code section 152(f)(1))who as of the end of the calendar year has not attained age 27;and(c)a child to whom Code section 152(e)applies(regarding certain children of divorced or separated parents who receive more than half of their support for the calendar year from one or both parents and are in the custody of one or both parents for more than half of the calendar year). 1.2 Effective Date July 1, 2019, the date this amendment and restatement of the Plan is effective. 1.3 Eligible Medical Expense An expense incurred during the Period of Coverage or related Grace Period for which the election is in force by a Participant or his or her Spouse or Dependent for"medical care"as defined in Code section 213(d)(including,for example,amounts paid for hospital,doctor,and dental bills), but only to the extent the Participant or other person incurring the expense certifies that he or she has not been reimbursed (and that he or she will not seek reimbursement) for the expense under any other plan covering health benefits. For this purpose, a medical care expense is incurred at the time the medical care or service giving rise to the expense, not when the Participant is formally billed, charged, or pays for the medical care. "Eligible Medical Expense" excludes: (a) premium payments for other health coverage, including but not limited to health insurance premiums for any other plan(whether or not sponsored by the Employer); (b) any expense incurred for drugs or medications obtained without a prescription, other than insulin; (c) any expense incurred for cosmetic surgery or other similar procedures, unless the surgery or procedure is necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or disfiguring disease; (d)long-term care services; and (e) any other expense excluded under Appendix A or otherwise under the terms of the Plan. 2 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 81 of 549 Page 64 of 138 1.4 Grace Period The period that begins immediately following the close of a Plan Year under the Health FSA and that ends on the day that is two months plus 15 days following the close of that Plan Year. 1.5 Health FSA The Central Contra Costa Sanitary District Health Flexible Spending Arrangement Plan. 1.6 Health FSA Subaccount The bookkeeping entry to record amounts withheld from a Participant's Compensation and that are available for a future reimbursement of a Participant's Eligible Medical Expenses. No money will actually be allocated to or held under any individual Participant's Health FSA Subaccount. A Health FSA Subaccount will be maintained by the Plan Administrator for accounting purposes, and will not be representative of any identifiable trust assets.No interest will be credited to or paid on amounts credited to the Participant's Health FSA Subaccount. 1.7 HIPAA The Health Insurance Portability and Accountability Act of 1996, as amended. 1.8 Participant An individual who has met the eligibility requirements under Section 3.1, elected to participate in accordance with Section 3.2, and whose participation has not terminated under Section 3.3. 1.9 Run-Out Period The period during which expenses incurred during a Plan Year or the related Grace Period must be submitted to be eligible for reimbursement. The Run Out Period for a Plan Year ends 90 days after the last day of that Plan Year. 1.10 Section 125 Plan The Central Contra Costa Sanitary District Section 125 Cafeteria Plan, as amended. 3 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 82 of 549 Page 65 of 138 ARTICLE II: SCOPE OF THE PLAN Subject to the conditions and limitations set forth in this Health FSA and in the Section 125 Plan, each Participant may elect to receive payment under the Health FSA for his or her Eligible Medical Expenses in lieu of an equal amount of cash. 4 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 83 of 549 Page 66 of 138 ARTICLE III: ELIGIBILITY AND PLAN PARTICIPATION 3.1 Eligibility to Participate Each Employee is eligible to participate in the Health FSA on the first day of the month after he or she becomes an Eligible Employee. The Employee's commencement of participation in the Health FSA is conditioned on the Employee timely electing to participate in the Health FSA in accordance with Section 3.2. 3.2 Election to Participate An Eligible Employee can elect to participate in the Health FSA by electing in accordance with Article III of the Section 125 Plan (a) to receive benefits in the form of reimbursements for Eligible Medical Expenses from the Health FSA; (b)to pay his or her contribution for such Health FSA benefits on pre-tax Salary Reduction basis or with Employer Credits; and(c) designating the amount of Salary Reduction and Employer Credits to be allocated to the Health FSA Subaccount for the Period of Coverage,as provided in Section 3.4 of the Section 125 Plan.Unless an exception applies (as described in Section 3.6 of the Section 125 Plan), any such election is irrevocable for the duration of the Period of Coverage to which it relates. 3.3 Termination of Participation A Participant's participation in the Health FSA will terminate upon the earliest of. (a) the termination of the Health FSA or the Section 125 Plan; (b) the Participant's permitted election not to participate in the Health FSA; (c) the Participant ceases to be an Eligible Employee; or (d) the last day of the Plan Year,unless the Participant elects to continue to participate in the next Plan Year. Termination of participation will automatically revoke the Participant's elections. If revocation occurs under this Section 3.3, no new election may be made by such Participant during the remainder of the Plan Year unless otherwise permitted under the Health FSA. A Participant and his or her Spouse and covered Dependents may be entitled to COBRA coverage in accordance with Article VI if coverage under this Health FSA is lost because of a COBRA qualifying event. 5 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 84 of 549 Page 67 of 138 3.4 Resumption of Participation Former Participants in the Health FSA will be reinstated in accordance with Section 2.3 of the Section 125 Plan. 3.5 Leaves of Absence See Sections 2.4 and 2.5 of the Section 125 Plan for rules regarding the effect of a leave of absence on a Participant's participation in the Health FSA. 6 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 85 of 549 Page 68 of 138 ARTICLE IV: PLAN FUNDING 4.1 Establishment of Accounts Section 3.1 of the Section 125 Plan which provides for the establishment of Accounts and Subaccounts will, as modified by this section, also apply to the Health FSA. The Plan Administrator will establish and maintain a Health FSA Subaccount with respect to each Participant for each Plan Year or other Period of Coverage for which the Participant elects to participate in the Health FSA, but it will not create a separate fund or otherwise segregate assets for this purpose. The Subaccount so established will merely be a recordkeeping account with the purpose of keeping track of contributions and determining forfeitures under Section 5.3. (a) Crediting of Subaccounts. A Participant's Health FSA Subaccount for a Plan Year or other Period of Coverage will be credited periodically during such period with an amount equal to the Participant's Salary Reductions and Employer Credits elected to be allocated to the Subaccount. (b) Debiting of Subaccounts. A Participant's Health FSA Subaccount for a Plan Year or other Period of Coverage will be debited for any reimbursement of Eligible Medical Expenses incurred during such Period of Coverage (or for reimbursement of Eligible Medical Expenses incurred during any Grace Period to which he or she is entitled as provided in Section 5.4). (c) Available Amount Not Based on Credited Amount. As described in Section 5.2, the amount available for reimbursement of Eligible Medical Expenses is the Participant's annual benefit amount, reduced by prior reimbursements for Eligible Medical Expenses incurred during the Plan Year or other Period of Coverage; it is not based on the amount credited to the Health FSA Subaccount at a particular point in time. Thus, a Participant's Health FSA Subaccount may have a negative balance during a Plan Year or other Period of Coverage,but the aggregate amount of reimbursement will in no event exceed the maximum dollar amount elected by the Participant under this Plan. 4.2 Employer Credits Each Eligible Employee may, in accordance with Article III of the Section 125 Plan, elect to apply Employer Credits to his or her Account under Section 3.2 of the Section 125 Plan to the Health FSA to reimburse Eligible Medical Expenses the extent permitted under that section. 7 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 86 of 549 Page 69 of 138 4.3 Salary Reduction Credits In accordance with Section 3.4 of the Section 125 Plan, each Participant will designate the amount of Salary Reduction contributions to be available during the Period of Coverage for Eligible Medical Expense reimbursements under the Health FSA. Contributions will be withheld from each Participant's Compensation, and an equivalent amount will be credited to the Participant's Health FSA Subaccount (although no actual assets will be set aside in that account or any other account).A Participant's contributions for each Plan Year will equal the annual benefit amount elected by the Participant on his or her election form for the Plan Year and may not exceed the maximum annual dollar limit for the Health FSA in effect under Section 4.6 for the Plan Year. 4.4 Time for Making Salary Reduction Elections The timing of Salary Reduction elections under the Health FSA must be consistent with the timing for making such elections described in Section 3.5 of the Section 125 Plan. 4.5 Change or Revocation of Elections A Participant's Salary Reduction election for any Period of Coverage may not be changed or revoked after the first payroll period to which it applies, except under the circumstances described in Section 3.6 of the Section 125 Plan. 4.6 Limit on Amount Credited to Health FSA Effective for the Plan Year beginning January 1,2019,the annual Salary Reduction amount credited to a Participant's Health FSA Subaccount must not exceed $2,700. In subsequent years, the limitation set forth in this Section 4.6 will be adjusted for cost of living increases as set forth in section 125(1)(2) of the Code. 4.7 Plan Administrator's Power to Modify Elections Section 3.10 of the Section 125 Plan which provides the Plan Administrator with the power to modify Salary Reduction elections shall also apply to this Health FSA. 8 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 87 of 549 Page 70 of 138 ARTICLE V: BENEFITS 5.1 Health Care Reimbursement A Participant may receive reimbursement under the Health FSA for Eligible Medical Expenses incurred during the Period of Coverage to which the Participant's participation election applies. In addition, certain individuals may receive a reimbursement for Eligible Medical Expenses incurred during the Grace Period immediately following the close of a Plan Year in accordance with Section 5.4.Eligible Medical Expenses will be reimbursed only if incurred during the Period of Coverage or, if applicable, during the Grace Period immediately following the end of a Plan Year. Eligible Medical Expenses will not be reimbursed for any Plan Year or related Grace Period,unless the Participant applies for such reimbursement before the end of the Run-Out Period. 5.2 Maximum Reimbursement Available; Uniform Coverage The maximum dollar amount elected by the Participant for reimbursement of Eligible Medical Expenses incurred during a Period of Coverage, reduced by prior reimbursements during the Period of Coverage (Grace Period reimbursements for a prior Plan Year are not counted), will be available at all times during the Period of Coverage, regardless of the actual amounts credited to the Participant's Health FSA Subaccount pursuant to Section 4.1. Despite the preceding, no reimbursement will be available for Eligible Medical Expenses incurred after coverage under this Health FSA has terminated, unless the Participant has elected COBRA. 5.3 Forfeitures Except as otherwise provided below(regarding certain individuals who may be reimbursed from prior Plan Year Health FSA amounts for expenses incurred during a Grace Period), if any balance remains in the Participant's Health FSA Subaccount for a Period of Coverage after all reimbursements have been made for the Period of Coverage, then such balance will not be carried over to reimburse the Participant for Eligible Medical Expenses incurred during a subsequent Plan Year. The Participant will forfeit all rights with respect to such balance. All forfeitures under this Plan will be used as follows: (a) first,to offset any losses experienced by the Employer during the Plan Year as a result of making reimbursements (i.e.,providing Health FSA benefits)with respect to all Participants in excess of the contributions paid by such Participants through Salary 9 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 88 of 549 Page 71 of 138 Reductions; (b) second, to reduce the cost of administering the Health FSA during the Plan Year or the subsequent Plan Year (all such administrative costs will be documented by the Plan Administrator); and (c) third, to provide increased benefits or compensation to Participants in subsequent years in any weighted or uniform fashion the Plan Administrator deems appropriate, consistent with applicable regulations. In addition, any Health FSA Subaccount benefit payments that are unclaimed (e.g., uncashed benefit checks) by the close of the Plan Year following the Period of Coverage in which the Eligible Medical Expense was incurred will be forfeited and applied as described above. 5.4 Grace Period The Health FSA has a Grace Period that follows the end of the Plan Year during which amounts that the Participant has allocated to his or her Health FSA Subaccount that are unused at the end of the Plan Year may be used to reimburse Eligible Medical Expenses incurred during the Grace Period. To take advantage of the Grace Period, a Participant must be (a) a Participant on the last day of the Plan Year to which the Grace Period relates, or (b) a qualified beneficiary (as defined under COBRA) who is receiving COBRA coverage under the Health FSA on the last day of the Plan Year to which the Grace Period relates. Eligible Medical Expenses incurred during a Grace Period and approved for reimbursement will be paid first from available amounts that were remaining at the end of the Plan Year to which the Grace Period relates, and then from any amounts that are available to reimburse expenses incurred during the current Plan Year. Claims will be paid in the order in which they are received. Previous claims will not be reprocessed or recharacterized so as to change the order in which they were received. Expenses incurred during a Grace Period must be submitted before the end of the Run-Out Period. Any unused amounts from a Plan Year to which the Grace Period relates that are not used to reimburse Eligible Medical Expenses incurred either during the Plan Year or during the related Grace Period will be forfeited if not submitted for reimbursement before the end of the Run-Out Period. A Participant may not use Health FSA amounts to reimburse Eligible Dependent Care Expenses, as defined in the Central Contra Costa Sanitary District Dependent Care Assistance Plan. 10 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 89 of 549 Page 72 of 138 5.5 Receiving Health Care Reimbursement Payment will be made to the Participant in cash as a reimbursement for Eligible Medical Expenses incurred by the Participant (or his or her Spouse or Dependents) while he or she is a Participant during the Plan Year for which the Participant's election is effective, but only if the substantiation requirements of Section 7.2 are satisfied. However, if the Plan Administrator so permits, the Participant may choose to make payment for an Eligible Medical Expense with an electronic payment card arrangement. 11 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 90 of 549 Page 73 of 138 ARTICLE VI: POST-PARTICIPATION REIMBURSEMENTS; COBRA 6.1 General Rule When a Participant ceases to be a Participant under Section 3.3, the Participant's Salary Reductions and election to participate will terminate. The Participant will not be able to receive reimbursements for Eligible Medical Expenses incurred after the end of the day on which the Participant's employment terminates or the Participant otherwise ceases to be eligible. However, such Participant (or the Participant's estate) may claim reimbursement for any Eligible Medical Expenses incurred during the Period of Coverage prior to the date that the Participant ceases to be eligible,provided that the Participant(or the Participant's estate) files a claim within 90 days after the date that the Participant ceases to be a Participant. 6.2 COBRA Continuation Coverage Notwithstanding any provision to the contrary in this Health FSA, to the extent required by COBRA, a Participant and his or her Spouse and Dependents, as applicable, whose coverage terminates under the Health FSA because of a COBRA qualifying event (and who is a qualified beneficiary as defined under COBRA)will be given the opportunity to continue on a self-pay basis the same coverage that he or she had under the Health FSA the day before the qualifying event for the periods prescribed by COBRA. Specifically, such individuals will be eligible for COBRA continuation coverage only if, under Section 4.1, they have a positive Health FSA Subaccount balance at the time of a COBRA qualifying event(taking into account all claims submitted before the date of the qualifying event). Such individuals will be notified if they are eligible for COBRA continuation coverage. If COBRA is elected, it will be available only for the remainder of the Plan Year in which the qualifying event occurs. COBRA coverage for the Health FSA will cease at the end of the Plan Year and cannot be continued for the next Plan Year. Notwithstanding the preceding sentence, a qualified beneficiary who has coverage on the last day of the Plan Year may be entitled to reimbursement of Eligible Medical Expenses incurred during the Grace Period following that Plan 12 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 91 of 549 Page 74 of 138 Year in accordance with Section 5.4. COBRA continuation coverage will be subject to all conditions and limitations under COBRA. Contributions for coverage for Health FSA benefits may be paid on a pre-tax basis for current Employees receiving taxable compensation(as may be permitted by the Plan Administrator on a uniform and consistent basis, but may not be prepaid from contributions in one Plan Year to provide coverage that extends into a subsequent Plan Year)where COBRA coverage arises either (a) because the Employee ceases to be eligible because of a reduction of hours, or(b)because the Employee's Dependent ceases to satisfy the eligibility requirements for coverage. For all other individuals (e.g., Employees who cease to be eligible because of retirement, termination of employment, or layoff), contributions for COBRA coverage for Health FSA benefits must be paid on an after-tax basis (unless permitted otherwise by the Plan Administrator on a uniform and consistent basis, but may not be prepaid from contributions in one Plan Year to provide coverage that extends into a subsequent Plan Year). If COBRA is not elected, the qualified beneficiary's coverage under the Health FSA will end on the date the qualified beneficiary would otherwise lose coverage. 13 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 92 of 549 Page 75 of 138 ARTICLE VII: CLAIMS PROCEDURES 7.1 General Reimbursement Procedures A Participant must apply for reimbursement by submitting a request in writing to the Plan Administrator in such form as the Plan Administrator may prescribe, no later than the end of the Run-Out Period following the close of the Plan Year in which the Eligible Medical Expense was incurred (except that for a Participant who ceases to be eligible to participate, this must be done no later than 90 days after the date that eligibility ceases, as described in Section 6.1) and must provide the substantiation required Section 7.2 or as otherwise requested by the Plan Administrator or its designee. 7.2 Substantiation of Expenses The reimbursement request described in Section 7.1 must include: (a) the person(s) on whose behalf Eligible Medical Expenses have been incurred; (b) the nature and date of the expenses so incurred; (c) the amount of the requested reimbursement; (d) a statement that such expenses have not otherwise been reimbursed and that the Participant will not seek reimbursement through any other source; and (e) other such details about the expenses that may be requested by the Plan Administrator in the reimbursement request form or otherwise (e.g., a statement from a medical practitioner that the expense is to treat a specific medical condition,documentation that a medicine or drug was prescribed, or a more detailed certification from the Participant). The reimbursement request must be accompanied by bills, invoices, or other statements from an independent third party showing that the Eligible Medical Expenses have been incurred and showing the amounts of such expenses, along with any additional documentation the Plan Administrator may request. If the Health FSA is accessible by an electronic payment card (e.g., debit card, credit card, or similar arrangement), the Participant will be required to comply with mandatory substantiation procedures and other mandatory terms and conditions that will govern the Participant's use of the electronic payment card in accordance with Code section 125 and applicable IRS guidance. 14 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 93 of 549 Page 76 of 138 7.3 Claims and Appeals Procedures See Article VI of the Section 125 Plan for procedures for processing claims and appeals of denied claims. 15 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 94 of 549 Page 77 of 138 ARTICLE VIII: GENERAL PROVISIONS 8.1 Administration of the Health FSA The Health FSA will be administered in accordance with provisions set forth in Article V of the Section 125 Plan. 8.2 Miscellaneous Provisions The miscellaneous provisions described in Article VII of the Section 125 Plan will also apply to this Health FSA. 8.3 Amendment and Termination of the Health FSA Subject to Article VIII of the Section 125 Plan,the Employer may amend or terminate this Health FSA in whole or in part at any time and for any reason by resolution of the Board or by any person or persons authorized by the Board to take such action. 8.4 Coordination of Benefits Under the Health FSA The Health FSA is intended to pay benefits solely for otherwise unreimbursed medical expenses. Accordingly, it will not be considered a group health plan for coordination of benefits purposes, and its benefits will not be taken into account when determining benefits payable under any other plan. 8.5 HIPAA Compliance The Health FSA will comply with the applicable requirements of HIPAA in accordance with the rules set out in Appendix B. 16 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 95 of 549 Page 78 of 138 ARTICLE IX: EXECUTION As evidence of its amendment and restatement of this Health FSA,the Central Contra Costa Sanitary District has caused this instrument to be signed by its duly authorized officers on this day of , 2019. By: President, Board of Directors For: THE CENTRAL CONTRA COSTA SANITARY DISTRICT ATTEST: By: (Sign Name) Date Katie Young, Secretary of the District (Print Name and Title) 17 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 96 of 549 Page 79 of 138 APPENDIX A MEDICAL EXPENSES NOT REIMBURSABLE FROM THE HEALTH FSA The Central Contra Costa Sanitary District Health Flexible Spending Arrangement Plan ("Health FSA") document contains the general rules governing what expenses are reimbursable. This Appendix A, as referenced in the Health FSA document, specifies certain expenses that are excluded under this Health FSA with respect to reimbursement from the Health FSA — that is, expenses that are not reimbursable, even if they meet the definition of"medical care"under Code section 213(d) and may otherwise be reimbursable under the regulations governing health FSAs. Exclusions: The following expenses are not reimbursable from the Health FSA,even if they meet the definition of"medical care" under Code Section 213(d) and may otherwise be reimbursable under legal requirements applicable to health FSAs: • Premiums for other health coverage, • Costs for sending a problem child to a including but not limited to premiums for special school for benefits that the child any other plan (whether or not sponsored may receive from the course of study and by the Employer) disciplinary methods • Long-term care services • Social activities, such as dance lessons • Cosmetic surgery or other similar (even if recommended by a physician for procedures, unless the surgery or general health improvement) procedure is necessary to ameliorate a • Bottled water deformity arising from, or directly related • Cosmetics,toiletries,toothpaste, etc. to, a congenital abnormality, a personal injury resulting from an accident or • Uniforms or special clothing, such as trauma, or a disfiguring disease. "Cosmetic maternity clothing surgery"means any procedure that is • Automobile insurance premiums directed at improving the patient's appearance and does not meaningfully • Transportation expenses of any kind, promote the proper function of the body or including transportation expenses to prevent or treat illness or disease. receive medical care • The salary expense of a nurse to care for a • Marijuana and other controlled substances healthy newborn at home that are in violation of federal laws, even if • Funeral and burial expenses prescribed by a physician • Any item that does not constitute "medical • Household and domestic help (even if care" as defined under Code section 213(d) recommended by a qualified physician due to an Employee's or Dependent's inability • Any item that is not reimbursable due to to perform physical housework) any other applicable law or regulations • Custodial care • Medicines or drugs (other than insulin) that have not been prescribed A-1 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 97 of 549 Page 80 of 138 APPENDIX B HIPAA COMPLIANCE B.1 Provision of Protected Health Information to Employer Members of the Employer's workforce have access to the individually identifiable health information of Plan participants for administrative functions of the Health FSA. When this health information is provided from the Health FSA to the Employer, it is Protected Health Information (PHI). The Health Insurance Portability and Accountability Act of 1996 (HIPAA) and its implementing regulations restrict the Employer's ability to use and disclose PHI. The following HIPAA definition of PHI applies for purposes of this Appendix B: Protected Health Information. Protected health information means information that is created or received by the Health FSA and relates to the past, present, or future physical or mental health or condition of a participant;the provision of health care to a participant;or the past,present,or future payment for the provision of health care to a participant; and that identifies the participant or for which there is a reasonable basis to believe the information can be used to identify the participant. Protected health information includes information of persons living or deceased. The Employer will have access to PHI from the Health FSA only as permitted under this Appendix B or as otherwise required or permitted by HIPAA. HIPAA and its implementing regulations were modified by the Health Information Technology for Economic and Clinical Health Act(HITECH Act), the statutory provisions of which are incorporated herein by reference. B.2 Permitted Disclosure of Enrollment/Disenrollment Information The Health FSA may disclose to the Employer information on whether the individual is participating in the Health FSA. B.3 Permitted Uses and Disclosure of Summary Health Information The Health FSA may disclose Summary Health Information to the Employer, provided that the Employer requests the Summary Health Information for the purpose of modifying, amending, or terminating the Health FSA. "Summary Health Information"means information(a)that summarizes the claims history, claims expenses, or type of claims experienced by individuals for whom a plan sponsor had provided health benefits under a health plan; and (b) from which the information described at 42 CFR Section 164.514(b)(2)(i)has been deleted, except that the geographic information described in 42 CFR Section 164.514(b)(2)(i)(B) need only be aggregated to the level of a five-digit ZIP code. B.4 Permitted and Required Uses and Disclosure of PHI for Plan Administration Purposes Unless otherwise permitted by law, and subject to the conditions of disclosure described in Section 13.5 and obtaining written certification pursuant to Section 13.7, the Health FSA may disclose PHI to the Employer, provided that the Employer uses or discloses such PHI only for plan B-1 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 98 of 549 Page 81 of 138 administration purposes. "Plan administration purposes" means administration functions performed by the Employer on behalf of the Health FSA, such as quality assurance, claims processing, auditing, and monitoring. Plan administration functions do not include functions performed by the Employer in connection with any other benefit or benefit plan of the Employer, and they do not include any employment-related functions. Notwithstanding the provisions of this Health FSA to the contrary, in no event will the Employer be permitted to use or disclose PHI in a manner that is inconsistent with 45 CFR Section 164.504(f). B.5 Conditions of Disclosure for Plan Administration Purposes The Employer agrees that with respect to any PHI (other than enrollment/disenrollment information and Summary Health Information, which are not subject to these restrictions) disclosed to it by the Health FSA, the Employer will: • not use or further disclose the PHI other than as permitted or required by the Health FSA or as required by law; • ensure that any agent, including a subcontractor,to whom it provides PHI received from the Health FSA agrees to the same restrictions and conditions that apply to the Employer with respect to PHI; • not use or disclose the PHI for employment-related actions and decisions or in connection with any other benefit or employee benefit plan of the Employer; • report to the Health FSA any use or disclosure of the information that is inconsistent with the uses or disclosures provided for of which it becomes aware; • make available PHI to comply with HIPAA's right to access in accordance with 45 CFR Section 164.524; • make available PHI for amendment and incorporate any amendments to PHI in accordance with 45 CFR Section 164.526; • make available the information required to provide an accounting of disclosures in accordance with 45 CFR Section 164.528; • make its internal practices, books, and records relating to the use and disclosure of PHI received from the Health FSA available to the Secretary of Health and Human Services for purposes of determining compliance by the Plan with HIPAA's privacy requirements; • if feasible, return or destroy all PHI received from the Health FSA that the Employer still maintains in any form and retain no copies of such information when no longer needed for the purpose for which disclosure was made, except that, if B-2 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 99 of 549 Page 82 of 138 such return or destruction is not feasible, limit further uses and disclosures to those purposes that make the return or destruction of the information infeasible; and • ensure that the adequate separation between the Health FSA and the Employer(i.e., the "firewall")required in 45 CFR Section 504(f)(2)(iii) is satisfied. The Employer further agrees that if it creates, receives, maintains, or transmits any electronic PHI (other than enrollment/disenrollment information and Summary Health Information,which are not subject to these restrictions) on behalf of the Health FSA, it will implement administrative, physical, and technical safeguards that reasonably and appropriately protect the confidentiality, integrity, and availability of the electronic PHI, and it will ensure that any agents (including subcontractors) to whom it provides such electronic PHI agree to implement reasonable and appropriate security measures to protect the information. The Employer will report to the Health FSA any security incident of which it becomes aware. B.6 Adequate Separation Between Plan and Employer The Employer will allow the following persons access to PHI: the Human Resources Director, the Plan Administrator, and any other Employee who needs access to PHI in order to perform plan administration functions that the Employer performs for the Health FSA (such as quality assurance, claims processing, auditing, and monitoring).No other persons will have access to PHI. These specified employees (or classes of employees) will only have access to and use PHI to the extent necessary to perform the plan administration functions that the Employer performs for the Health FSA.In the event that any of these specified employees does not comply with the provisions of this section, that employee will be subject to disciplinary action by the Employer for non- compliance pursuant to the Employer's employee discipline and termination procedures. The Employer will ensure that the provisions of this Section 13.6 are supported by reasonable and appropriate security measures to the extent that the designees have access to electronic PHI. B.7 Certification of Plan Sponsor The Health FSA will disclose PHI to the Employer only upon the receipt of a certification by the Employer that the Plan incorporates the provisions of 45 CFR Section 164.504(f)(2)(ii), and that the Employer agrees to the conditions of disclosure set forth in Section 13.5. Execution of the Health FSA by the Employer will serve as the required certification. B.8 Privacy Official The Employer will designate a Privacy Official, who will be responsible for the Health FSA's compliance with HIPAA. The Privacy Official may contract with or otherwise utilize the services of attorneys, accountants, brokers, consultants, or other third party experts as the Privacy Official deems necessary or advisable. In addition and notwithstanding any provision of this Health FSA to the contrary, the Privacy Official will have the authority to and be responsible for: • accepting and verifying the accuracy and completeness of any certification provided by the Employer under this Appendix; B-3 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 100 of 549 Page 83 of 138 • transmitting the certification to any third parties as may be necessary to permit them to disclose PHI to the Employer; • establishing and implementing policies and procedures with respect to PHI that are designed to ensure compliance by the Health FSA with the requirements of HIPAA; • establishing and overseeing proper training of personnel who will have access to PHI; and • any other duty or responsibility that the Privacy Official,in his or her sole capacity, deems necessary or appropriate to comply with the provisions of HIPAA and the purposes of this Appendix B. B.9 Interpretation and Limited Applicability This Appendix serves the sole purpose of complying with the requirements of HIPAA and will be interpreted and construed in a manner to effectuate this purpose. Neither this Appendix nor the duties, powers, responsibilities, and obligations listed herein will be taken into account in determining the amount or nature of the benefits provided to any person covered under the Health FSA,nor will they inure to the benefit of any third parties. To the extent that any of the provisions of this Appendix B are no longer required by HIPAA or do not apply to the Health FSA because the Health FSA is otherwise excepted from HIPAA,they will be deemed deleted and will have no force or effect. B.10 Service Performed for the Employer Notwithstanding any other provisions of this Health FSA to the contrary, all services performed by a business associate for the Health FSA in accordance with the applicable service agreement will be deemed to be performed on behalf of the Health FSA and subject to the administrative simplification provisions of HIPAA contained in 45 CFR Parts 160 through 164, except services that relate to eligibility and enrollment in the Health FSA. If a business associate of the Health FSA performs any services that relate to eligibility and enrollment in the Health FSA, these services will be deemed to be performed on behalf of the Employer in its capacity as the Health FSA sponsor and not on behalf of the Health FSA. B-4 15399198.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 101 of 549 Page 84 of 138 ATTACHMENT 4 CENTRAL CONTRA COSTA SANITARY DISTRICT DEPENDENT CARE ASSISTANCE PLAN (A Component Plan of the Central Contra Costa Sanitary District Section 125 Cafeteria Plan) Amended and Restated Effective July 1, 2019. 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 102 of 549 Page 85 of 138 TABLE OF CONTENTS Page ARTICLE 1: DEFINITIONS ...........................................................................................................2 1.1 DCAP.......................................................................................................................2 1.2 DCAP Subaccount...................................................................................................2 1.3 Dependent................................................................................................................2 1.4 Earned Income.........................................................................................................2 1.5 Eligible Dependent Care Expense ...........................................................................2 1.6 Grace Period.............................................................................................................3 1.7 Participant................................................................................................................3 1.8 Qualifying Dependent Care Services.......................................................................3 1.9 Qualifying Individual...............................................................................................3 1.10 Run-Out Period........................................................................................................4 1.11 Section 125 Plan ......................................................................................................4 1.12 Spouse......................................................................................................................4 1.13 Student.....................................................................................................................4 ARTICLE 11: SCOPE OF THE PLAN............................................................................................5 ARTICLE III: ELIGIBILITY AND PLAN PARTICIPATION......................................................6 3.1 Eligibility.................................................................................................................6 3.2 Election for Participation.........................................................................................6 3.3 Termination of Participation....................................................................................6 3.4 Reinstatement of Former Participant.......................................................................7 ARTICLE IV: PLAN FUNDING....................................................................................................8 4.1 Establishment of Accounts ......................................................................................8 4.2 Employer Credits.....................................................................................................8 4.3 Salary Reduction Credits .........................................................................................8 4.4 Time for Making Salary Reduction Elections .........................................................9 4.5 Change or Revocation of Elections..........................................................................9 4.6 Limit on Amount Credited to the DCAP.................................................................9 4.7 Plan Administrator's Power to Modify Elections..................................................10 ARTICLE V: BENEFITS..............................................................................................................11 5.1 Dependent Care Reimbursement...........................................................................11 5.2 Maximum Amount Available................................................................................11 i 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 103 of 549 Page 86 of 138 5.3 Forfeitures..............................................................................................................11 5.4 Grace Period...........................................................................................................12 5.5 Receiving Health Care Reimbursement.................................................................13 5.6 Post-Participation Reimbursements.......................................................................13 ARTICLE VI: CLAIMS PROCEDURES .....................................................................................14 6.1 General Reimbursement Procedures......................................................................14 6.2 Substantiation of Expenses....................................................................................14 6.3 Claims and Appeals Procedures.............................................................................15 ARTICLE VII: GENERAL PROVISIONS...................................................................................16 7.1 Administration of the Dependent Care Assistance Plan........................................16 7.2 Miscellaneous Provisions.......................................................................................16 7.3 Amendment and Termination of the Dependent Care Assistance Plan.................16 ARTICLE VIII: EXECUTION......................................................................................................17 ii 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 104 of 549 Page 87 of 138 CENTRAL CONTRA COSTA SANITARY DISTRICT DEPENDENT CARE ASSISTANCE PLAN INTRODUCTION Effective as of July 1, 2019, the Central Contra Costa Sanitary District (the "Employer") hereby amends and restates the Central Contra Costa Sanitary District Dependent Care Assistance Plan (the "DCAP") to allow Eligible Employees of the Employer to elect to receive dependent care assistance benefits which are excludible from gross income under section 129(a) of the Internal Revenue Code of 1986, as amended (the "Code"), as provided herein and in accordance with the terms of the Central Contra Costa Sanitary District Section 125 Cafeteria Plan (the "Section 125 Plan"). The Employer originally adopted the DCAP effective May 1, 1989. Since then, the Employer has amended the DCAP on various occasions. The Employer most recently amended and restated the DCAP effective January 1, 2013. This DCAP is a Component Plan of the Section 125 Plan and,except to the extent otherwise expressly provided herein, is governed by the rules and regulations of the Section 125 Plan. The DCAP is intended to qualify as a dependent care assistance program within the meaning of section 129 of the Code, and will be interpreted in a manner consistent with the requirements of section 129. 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 105 of 549 Page 88 of 138 ARTICLE I: DEFINITIONS The definitions in the Section 125 Plan apply to this Component Plan as well as the following definitions specific to the DCAP: 1.1 DCAP The Central Contra Costa Sanitary District Dependent Care Assistance Plan. 1.2 DCAP Subaccount The bookkeeping entry to record amounts withheld from a Participant's Compensation and that are available for a future reimbursement of a Participant's Eligible Dependent Care Expenses. No money will actually be allocated to or held under any individual Participant's DCAP Subaccount. A DCAP Subaccount will be maintained by the Plan Administrator for accounting purposes, and will not be representative of any identifiable trust assets.No interest will be credited to or paid on amounts credited to the Participant's DCAP Subaccount. 1.3 Dependent A Qualifying Individual. 1.4 Earned Income Will have the meaning given such term in Code section 129(e)(2). 1.5 Eligible Dependent Care Expense An expense that is an employment-related expense under Code section 21(b)(2) that is incurred for the care of a Qualifying Individual and that is necessary for gainful employment of the Participant and Spouse, if any, and expenses for incidental household services, if paid for by the Participant to obtain Qualifying Dependent Care Services. An Eligible Dependent Care Expense excludes a payment to (a) an individual with respect to whom a personal exemption is allowable under Code section 151(c) to a Participant or his or her Spouse; (b) a Participant's Spouse; (c) a Participant's child (as defined in Code section 152(f)(1) who is under age 19 at the end of the Plan Year in which the expense was incurred); or (d) a parent of a Participant's under- age-13 qualifying child. Eligible Dependent Care Expenses are eligible for reimbursement under this DCAP. 2 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 106 of 549 Page 89 of 138 1.6 Grace Period The period that begins immediately following the close of a Plan Year under the DCAP and that ends on the day that is two months plus 15 days following the close of that Plan Year. 1.7 Participant An individual who has met the eligibility requirements under Section 3.1, elected to participate in accordance with Section 3.2, and whose participation has not terminated under Section 3.3. 1.8 Qualifying Dependent Care Services Services that are both (1) related to the care of a Qualifying Individual that enables the Participant and Spouse to remain gainfully employed, and(2)performed: (a) in the Participant's home, or (b) outside the Participant's home for (i) the care of a Participant's qualifying child who is under age 13, or (ii) the care of any other Qualifying Individual who regularly spends at least eight hours per day in the Participant's home. If the services are provided by a dependent care center(i.e.,a facility that provides care for more than six individuals not residing at the facility and that receives a fee, payment, or grant for such services),then the center must comply with all applicable state and local laws and regulations. 1.9 Qualifying Individual An individual who with respect to the Participant is (a) a tax dependent as defined in Code Section 152 who is under the age of 13 and who is the Participant's qualifying child as defined in Code section 152(a)(1); (b) a tax dependent as defined in Code Section 152, but determined without regard to subsections (b)(1), (b)(2), and (d)(1)(13) thereof, who is physically or mentally incapable of self-care and who has the same principal place of abode as the Participant for more than half of the year; or(c)a Spouse who is physically or mentally incapable of self-care, and who has the same principal place of abode as the Participant for more than half of the year. Notwithstanding the foregoing, in the case of divorced or separated parents, a Qualifying Individual who is a child will, as provided in Code section 21(e)(5), be treated as a Qualifying 3 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 107 of 549 Page 90 of 138 Individual of the custodial parent (within the meaning of Code section 152(e)) and will not be treated as a Qualifying Individual with respect to the noncustodial parent. 1.10 Run-Out Period The period during which expenses incurred during a Plan Year or the related Grace Period must be submitted to be eligible for reimbursement. The Run Out Period for a Plan Year ends 90 days after the last day of that Plan Year. 1.11 Section 125 Plan The Central Contra Costa Sanitary District Section 125 Cafeteria Plan, as amended. 1.12 Spouse The individual who is legally married to the Participant under applicable state law and who is treated as a spouse under the Code, excluding any individual who (a) is legally separated from the Participant under a divorce or separate maintenance decree; or (b) although married to the Participant,files a separate federal income tax return,maintains a principal residence separate from the Participant during the last six months of the taxable year, and does not furnish more than half of the cost of maintaining the principal place of abode of the Participant. 1.13 Student An individual who, during each of five or more calendar months during the Plan Year, is a full-time student at any educational organization that normally maintains a regular faculty and curriculum and normally has an enrolled student body in attendance at the location where its educational activities are regularly carried on. 4 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 108 of 549 Page 91 of 138 ARTICLE II: SCOPE OF THE PLAN Subject to the conditions and limitations set forth in this DCAP and in the Section 125 Plan, each Participant may elect to receive reimbursement under the DCAP for his or her Eligible Dependent Care Expenses in lieu of an equal amount of cash. 5 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 109 of 549 Page 92 of 138 ARTICLE III: ELIGIBILITY AND PLAN PARTICIPATION 3.1 Eligibility Each Employee is eligible to participate in the DCAP on the first day of the month after he or she becomes an Eligible Employee. The Employee's commencement of participation in the DCAP is conditioned on the Employee timely electing to participate in the DCAP in accordance with Section 3.2. 3.2 Election for Participation An Eligible Employee can elect to participate in the DCAP by electing in accordance with Article III of the Section 125 Plan(a)to receive benefits in the form of reimbursements for Eligible Dependent Care Expenses from the DCAP; (b) to pay his or her contribution for such DCAP benefits on a pre-tax Salary Reduction basis or with Employer Credits; and (c) designating the amount of Salary Reduction and Employer Credits to be allocated to the DCAP Subaccount for the Period of Coverage, as provided in Section 3.4 of the Section 125 Plan. Unless an exception applies (as described in Section 3.6 of the Section 125 Plan), any such election is irrevocable for the duration of the Period of Coverage to which it relates. 3.3 Termination of Participation A Participant's participation in the DCAP will terminate upon the earliest of: (a) the termination of the DCAP or the Section 125 Plan; (b) the Participant's permitted election not to participate in the DCAP; (c) the Participant ceases to be an Eligible Employee; or (d) the last day of the Plan Year,unless the Participant elects to continue to participate in the next Plan Year. Termination of participation will automatically revoke the Participant's elections. If revocation occurs under this Section 3.3, no new election may be made by such Participant during the remainder of the Plan Year unless otherwise permitted under the DCAP. 6 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 110 of 549 Page 93 of 138 3.4 Reinstatement of Former Participant Former Participants of the DCAP will be reinstated consistent with the provisions of Section 2.3 of the Section 125 Plan. 3.5 Leaves of Absence See Sections 2.4 and 2.5 of the Section 125 Plan for rules regarding the effect of a leave of absence on a Participant's participation in the DCAP. 7 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 111 of 549 Page 94 of 138 ARTICLE IV: PLAN FUNDING 4.1 Establishment of Accounts Section 3.1 of the Section 125 Plan which provides for the establishment of Accounts and Subaccounts will, as modified by this section, also apply to the DCAP. The Plan Administrator will establish and maintain a DCAP Subaccount with respect to each Participant who has elected to participate in the DCAP, but it will not create a separate fund or otherwise segregate assets for this purpose. The Subaccount so established will merely be a recordkeeping account with the purpose of keeping track of contributions and determining forfeitures under Section 5.3. (a) Crediting of accounts. A Participant's DCAP Subaccount for a Period of Coverage will be credited periodically during such Period of Coverage with an amount equal to the Participant's Salary Reductions elected to be allocated to the Subaccount. (b) Debiting of accounts.A Participant's DCAP Subaccount will be debited during each Period of Coverage for any reimbursement of Eligible Dependent Care Expenses incurred during the Period of Coverage (or for reimbursement of Eligible Dependent Care Expenses incurred during any Grace Period to which he or she is entitled as provided in Section 5.4). (c) Available Amount is Based on Credited Amount. As described in Section 5.2, the amount available for reimbursement of Eligible Dependent Care Expenses may not exceed the year-to-date amount credited to the Participant's DCAP Subaccount,less any prior reimbursements (i.e., it is based on the amount credited to the DCAP Subaccount at a particular point in time). Thus, a Participant's DCAP Subaccount may not have a negative balance during a Period of Coverage. 4.2 Employer Credits Each Eligible Employee may, in accordance with Article III of the Section 125 Plan, elect to apply Employer Credits to his or her Account under Section 3.2 of the Section 125 Plan to the DCAP to reimburse Eligible Dependent Care Expenses the extent permitted under that section. 4.3 Salary Reduction Credits In accordance with Section 3.4 of the Section 125 Plan, each Participant will designate the amount of Salary Reduction contributions to be available during the Period of Coverage for 8 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 112 of 549 Page 95 of 138 Eligible Dependent Care Expense reimbursements under the DCAP. Contributions will be withheld from each Participant's Compensation, and an equivalent amount will be credited to the Participant's DCAP Subaccount(although no actual assets will be set aside in that account or any other account). A Participant's contributions for each Plan Year will equal the annual benefit amount elected by the Participant on his or her election form for the Plan Year and may not exceed the maximum annual benefit limits for the DCAP set forth in Section 4.6 for the applicable Plan Year. 4.4 Time for Making Salary Reduction Elections The timing of Salary Reduction elections under the DCAP must be consistent with the timing for making such elections described in Section 3.5 of the Section 125 Plan. 4.5 Change or Revocation of Elections A Participant's Salary Reduction election for any Period of Coverage may not be changed or revoked after the first payroll period to which it applies, except under the circumstances described in Section 3.6 of the Section 125 Plan. 4.6 Limit on Amount Credited to the DCAP The maximum annual benefit amount that a Participant may elect to receive under this DCAP in the form of reimbursements for Eligible Dependent Care Expenses incurred in any Period of Coverage is $5,000 or, if lower, the maximum amount that the Participant has reason to believe will be excludable from his or her income at the time the election is made as a result of the applicable statutory limit for the Participant. The applicable statutory limit for a Participant is the smallest of the following amounts: (a) the Participant's Earned Income for the calendar year; (b) the Earned Income of the Participant's Spouse for the calendar year (for this purpose, a Spouse who is not employed during a month in which the Participant incurs an Eligible Dependent Care Expense and is either (i) physically or mentally incapable of self-care, or (ii) a Student will be deemed to have Earned Income in the amount specified in Code section 21(d)(2)); or (c) either$5,000 or$2,500 for the calendar year, as applicable below: 9 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 113 of 549 Page 96 of 138 (i) The amount is $5,000 for the calendar year if one of the following applies: (a) the Participant is married and files a joint federal income tax return; (b) the Participant is married, files a separate federal income tax return, and meets the following conditions: (1) the Participant maintains as his or her home a household that constitutes (for more than half of the taxable year) the principal abode of a Qualifying Individual (i.e., the Dependent for whom the Participant is eligible to receive reimbursements under the DCAP); (2) the Participant furnishes over half of the cost of maintaining such household during the taxable year; and(3) during the last six months of the taxable year, the Participant's Spouse is not a member of such household (i.e., the Spouse maintained a separate residence); or (c) the Participant is single or is the head of the household for federal income tax purposes. (ii) The amounts is$2,500 for the calendar year if the Participant is married and resides with the Spouse,but files a separate federal income tax return. 4.7 Plan Administrator's Power to Modify Elections Section 3.10 of the Section 125 Plan which provides the Plan Administrator with the power to modify Salary Reduction elections shall also apply to this DCAP. 10 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 114 of 549 Page 97 of 138 ARTICLE V: BENEFITS 5.1 Dependent Care Reimbursement A Participant may receive reimbursement under the DCAP for Eligible Dependent Care Expenses incurred during the Period of Coverage to which the Participant's participation election applies. In addition,certain individuals may receive a reimbursement for Eligible Dependent Care expenses incurred during the Grace Period immediately following the close of a Plan Year in accordance with Section 5.4. Eligible Dependent Care Expenses will be reimbursed only if incurred during the Period of Coverage or, if applicable, during the Grace Period immediately following the end of a Plan Year. Eligible Dependent Care Expenses will not be reimbursed for any Plan Year or related Grace Period, unless the Participant applies for such reimbursement before the end of the Run-Out Period. 5.2 Maximum Amount Available The maximum dollar amount elected by the Participant for reimbursement of Eligible Dependent Care Expenses incurred during a Period of Coverage,reduced by prior reimbursements during the Period of Coverage (Grace Period reimbursements for a prior Plan Year are not counted), will only be available during the Period of Coverage to the extent of the actual amounts credited to the Participant's DCAP Subaccount pursuant to Section 4.1.No reimbursement will be made to the extent that such reimbursement would exceed the balance in the Participant's DCAP Subaccount (that is, the year-to-date amount that has been withheld from the Participant's Compensation for reimbursement for Eligible Dependent Care Expenses for the Period of Coverage, less any prior reimbursements). 5.3 Forfeitures Except as otherwise provided below(regarding certain individuals who may be reimbursed from prior Plan Year DCAP amounts for expenses incurred during a Grace Period), if any balance remains in the Participant's DCAP Subaccount for a Period of Coverage after all reimbursements have been made for the Period of Coverage,then such balance will not be carried over to reimburse the Participant for Eligible Dependent Care Expenses incurred during a subsequent Plan Year. The Participant will forfeit all rights with respect to such balance. All forfeitures under this DCAP will be used as follows: (a)first,to offset any losses experienced by the Employer during the Plan Year 11 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 115 of 549 Page 98 of 138 as a result of making reimbursements (i.e., providing DCAP benefits) with respect to all Participants in excess of the contributions paid by such Participants through Salary Reductions; (b) second, to reduce the cost of administering the DCAP during the Plan Year or the subsequent Plan Year (all such administrative costs will be documented by the Plan Administrator); and (c) third, to provide increased benefits or compensation to Participants in subsequent years in any weighted or uniform fashion the Plan Administrator deems appropriate, consistent with applicable regulations. In addition, any DCAP Subaccount benefit payments that are unclaimed (e.g., uncashed benefit checks)by the close of the Plan Year following the Period of Coverage in which the Eligible Dependent Care Expense was incurred will be forfeited and applied as described above. 5.4 Grace Period The DCAP has a Grace Period that follows the end of the Plan Year during which amounts that the Participant has allocated to his or her DCAP Subaccount that are unused at the end of the Plan Year may be used to reimburse Eligible Dependent Care Expenses incurred during the Grace Period. To take advantage of the Grace Period, a Participant must be a Participant on the last day of the Plan Year to which the Grace Period relates. Eligible Dependent Care Expenses incurred during a Grace Period and approved for reimbursement will be paid first from available amounts that were remaining at the end of the Plan Year to which the Grace Period relates, and then from any amounts that are available to reimburse expenses incurred during the current Plan Year. Claims will be paid in the order in which they are received. Previous claims will not be reprocessed or recharacterized so as to change the order in which they were received. Expenses incurred during a Grace Period must be submitted before the end of the Run-Out Period. Any unused amounts from a Plan Year to which the Grace Period relates that are not used to reimburse Eligible Dependent Care Expenses incurred either during the Plan Year or during the related Grace Period will be forfeited if not submitted for reimbursement before the end of the Run-Out Period. A Participant may not use DCAP amounts to reimburse Eligible Medical Expenses, as defined in the Central Contra Costa Sanitary District Health Flexible Spending Arrangement Plan. 12 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 116 of 549 Page 99 of 138 5.5 Receiving Health Care Reimbursement Payment will be made to the Participant in cash as a reimbursement for Eligible Dependent Care Expenses incurred by the Participant (or his or her Spouse or Dependents) while he or she is a Participant during the Plan Year for which the Participant's election is effective, but only if the substantiation requirements of Section 6.2 are satisfied. However, if the Plan Administrator so permits, the Participant may choose to make payment for an Eligible Dependent Care Expense with an electronic payment card arrangement. 5.6 Post-Participation Reimbursements When a Participant ceases to be a Participant under Section 3.3, the Participant's Salary Reductions and election to participate will terminate. The Participant will not be able to receive reimbursements for Eligible Dependent Care Expenses incurred after the end of the day on which the Participant's employment terminates or the Participant otherwise ceases to be eligible. However, such Participant (or the Participant's estate) may claim reimbursement for any Eligible Dependent Care Expenses incurred during the Period of Coverage prior to the date that the Participant ceases to be eligible, provided that the Participant (or the Participant's estate) files a claim within 90 days after the date that the Participant ceases to be a Participant. 13 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 117 of 549 Page 100 of 138 ARTICLE VI: CLAIMS PROCEDURES 6.1 General Reimbursement Procedures A Participant must apply for reimbursement by submitting a request in writing to the Plan Administrator in such form as the Plan Administrator may prescribe, no later than the end of the Run-Out Period following the close of the Plan Year in which the Eligible Dependent Care Expense was incurred (except that for a Participant who ceases to be eligible to participate, this must be done no later than 90 days after the date that eligibility ceases, as described in Section 5.6) and must provide the substantiation required Section 6.2 or as otherwise requested by the Plan Administrator or its designee. 6.2 Substantiation of Expenses The reimbursement request described in Section 6.1 must include: (a) the person(s) on whose behalf Eligible Dependent Care Expenses have been incurred; (b) the nature and date of the expenses so incurred; (c) the amount of the requested reimbursement; (d) the name of the person, organization or entity to whom the expense was or is to be paid; (e) a statement that such expenses have not otherwise been reimbursed and that the Participant will not seek reimbursement through any other source; (f) the Participant's certification that he or she has no reason to believe that the reimbursement requested, added to his or her other reimbursements to date for Eligible Dependent Care Expenses incurred during the same calendar year, will exceed the applicable statutory limit for the Participant as described in Section 4.6; and (g) other such details about the expenses that may be requested by the Plan Administrator in the reimbursement request form or otherwise (e.g., a more detailed certification from the Participant). The application will be accompanied by bills, invoices, or other statements from an independent third parry showing that the Eligible Dependent Care Expenses have been incurred 14 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 118 of 549 Page 101 of 138 and showing the amounts of such expenses, along with any additional documentation that the Plan Administrator may request. If the DCAP is accessible by an electronic payment card (e.g., debit card, credit card, or similar arrangement), the Participant will be required to comply with mandatory substantiation procedures and other mandatory terms and conditions that will govern the Participant's use of the electronic payment card in accordance with Code section 125 and applicable IRS guidance. 6.3 Claims and Appeals Procedures See Article VI of the Section 125 Plan for procedures for processing claims and appeals of denied claims. 15 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 119 of 549 Page 102 of 138 ARTICLE VII: GENERAL PROVISIONS 7.1 Administration of the Dependent Care Assistance Plan The DCAP will be administered in accordance with provisions set forth in Article V of the Section 125 Plan. 7.2 Miscellaneous Provisions The miscellaneous provisions described in Article VII of the Section 125 Plan will also apply to this DCAP. 7.3 Amendment and Termination of the Dependent Care Assistance Plan Subject to Article VIII of the Section 125 Plan,the Employer may amend or terminate this DCAP in whole or in part at any time and for any reason by resolution of the Board or by any person or persons authorized by the Board to take such action. 16 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 120 of 549 Page 103 of 138 ARTICLE VIII: EXECUTION As evidence of its amendment and restatement of this DCAP, the Central Contra Costa Sanitary District has caused this instrument to be signed by its duly authorized officers on this day of , 2019. By: President, Board of Directors For: THE CENTRAL CONTRA COSTA SANITARY DISTRICT ATTEST: By: (Sign Name) Date Katie Young, Secretary of the District (Print Name and Title) 17 15402209.1 May 16, 2019 Regular Board Meeting Agenda Packet- Page 121 of 549 Page 104 of 138 ATTACHMENT 5 CENTRAL CONTRA COSTA SANITARY DISTRICT RETIREE HEALTH REIMBURSEMENT ARRANGEMENT Effective July 1, 2019 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 122 of 549 Page 105 of 138 TABLE OF CONTENTS PAGE ARTICLE I ESTABLISHMENT AND PURPOSE OF THE PLAN .................................................. 1 ARTICLE II DEFINITIONS............................................................................................................ 1 ARTICLE III ELIGIBILITY, PARTICIPATION, AND COVERAGE .................................................3 ARTICLE IV VESTING AND BENEFITS ......................................................................................4 ARTICLE V BENEFIT FUNDING..................................................................................................4 ARTICLE VI ADMINISTRATION OF THE PLAN ..........................................................................5 ARTICLE VII AMENDMENT AND TERMINATION OF THE PLAN ..............................................6 ARTICLE VIII GENERAL PROVISIONS.......................................................................................7 i 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 123 of 549 Page 106 of 138 CENTRAL CONTRA COSTA SANITARY DISTRICT RETIREE HEALTH REIMBURSEMENT ARRANGEMENT Effective July 1, 2019 ARTICLE I ESTABLISHMENT AND PURPOSE OF THE PLAN The Central Contra Costa Sanitary District (the Employer) provides post-retirement health benefits to its Eligible Retirees. The Employer hereby establishes this Central Contra Costa Sanitary District Retiree Health Reimbursement Arrangement (the Plan), effective July 1, 2019 (the Effective Date) to enable Eligible Retirees and eligible Beneficiaries to pay for the health care benefits described herein. The Plan is intended to qualify as a health reimbursement arrangement within the meaning of Internal Revenue Service Notice 2002-45, and it is intended that the benefits under the Plan be tax-free to the maximum extent permitted under the Internal Revenue Code and the regulations issued thereunder. The Plan will be administered and interpreted to accomplish that objective. Capitalized terms used in this Plan that are not otherwise defined have the meanings set forth in Article II. ARTICLE II DEFINITIONS 2.1 "Beneficiary" means an Eligible Retiree's or Employee's surviving family member who qualifies as an "annuitant" under California Government Code section 22760(c) or (h). 2.2 "Board of Directors" means the governing body of the Employer. 2.3 "CaIPERS" means the California Public Employees' Retirement System which administers CaIPERS Health. 2.4 "CaIPERS Health" means the health care program made available by the Employer to Eligible Retirees under the Public Employees' Medical and Hospital Care Act (PEMHCA), codified under sections 22750 - 22948 of the California Government Code, which program provides health insurance under various coverage options from which covered individuals may select. 2.5 "CCCERA" means the Contra Costa County Employees' Retirement Association in which the Employer is a participating agency. 2.6 "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended. 2.7 "Code" means the Internal Revenue Code of 1986 and the Treasury Regulations and guidance issued thereunder, as amended. 2.8 "Effective Date" means July 1, 2019. 1 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 124 of 549 Page 107 of 138 2.9 "Eligible Retiree" means an Employee who has met the eligibility requirements in Article III and Appendix A. An individual's status as an Eligible Retiree will be determined solely by the Employer. 2.10 "Employee" means a person whom the Employer classifies as a common-law employee and who is on the Employer's W-2 payroll, but does not include the following: (a) any leased employee (including but not limited to those individuals defined as leased employees in Code Section 414(n) or an individual classified by the Employer as a contract worker, independent contractor, temporary employee, or casual employee for the period during which such individual is so classified, whether or not any such individual is on the Employer's W-2 payroll or is determined by the IRS or others to be a common-law employee of the Employer; and (b) any individual who performs services for the Employer but who is paid by a temporary or other employment or staffing agency for the period during which such individual is paid by such agency, whether or not such individual is determined by the IRS or others to be a common-law employee of the Employer. 2.11 "Employer" means the Central Contra Costa Sanitary District. 2.12 "HIPAA" means the Health Insurance Portability and Accountability Act of 1996, as amended. 2.13 "MEC" means the minimum employer contribution required to be made by the Employer directly to CaIPERS for an Eligible Retiree's coverage under CaIPERS Health using the "unequal method" described in California Government Code Section 22892(c). Under that method, the minimum employer contribution for each Eligible Retiree will be $1 per month for 2019, and increased annually to 5% of the minimum employer contribution for active employees ($136 per month in 2019, and adjusted annually in accordance with California Government Code Section 22892) multiplied by the number of the Employer's years of participation in CaIPERS Health until the minimum employer contribution for retirees and active employees is equal (i.e., after 20 years of participation). The MEC is a separate benefit from the reimbursement benefits available under this Plan. The Employer pays the MEC directly to CalPERS on behalf of Eligible Retirees. 2.14 "Plan" means this Central Contra Costa Sanitary District Retiree Health Reimbursement Arrangement, as set forth herein and amended from time to time. 2.15 "Plan Administrator" means the Employer unless the Employer designates another person or organization to hold the position of Plan Administrator. The Employer may alternatively designate another person or organization to perform certain duties assigned to the Plan Administrator under this Plan. 2.16 "Plan Year" means the calendar year (i.e., the 12-month period commencing January 1 and ending on December 31). 2.17 "Trust" means the legal entity that the Employer may establish and/or adopt to hold any assets it has irrevocably set aside to pay benefits under the Plan. 2 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 125 of 549 Page 108 of 138 ARTICLE III ELIGIBILITY, PARTICIPATION, AND COVERAGE 3.1 Eligibility. Only Eligible Retirees are eligible to participate in the Plan. An individual will become an Eligible Retiree under the Plan only upon meeting all of the following requirements. a) The individual satisfies any applicable minimum age and service requirements set out under Appendix A at retirement under CCCERA in accordance with Section 3.1(b). b) The individual retired under CCCERA directly from the Employer within 120 days after his or her employment with the Employer terminated. If the Employee retires under CCCERA from any other governmental agency (or retires under any other governmental retirement plan and not under CCCERA), he or she will not meet this requirement. C) Upon retiring, the individual must be eligible for coverage under CalPERS Health as a retiree and must be entitled to the MEC. 3.2 No Benefits Unless Eligible. An Employee will not have any interest under the Plan unless he or she meets all of the requirements under Section 3.1. Any person who does not meet these requirements will not be entitled to any benefits under the Plan. 3.3 Commencement of Participation. Each Eligible Retiree on the Effective Date will participate in the Plan beginning on that date. Each person who becomes an Eligible Retiree after the Effective Date will begin participation in the Plan when he or she becomes an Eligible Retiree. 3.4 Period of Coverage. Participation in the Plan is tied to the Eligible Retiree's enrollment in CalPERS Health as a retiree. Coverage under this Plan for an Eligible Retiree will begin on the first day of the calendar month that coverage under CalPERS Health as a retiree begins. 3.5 Termination of Participation. An Eligible Retiree's participation in the Plan terminates upon the earlier of: a) the date he or she ceases to be an Eligible Retiree; b) the date that the Eligible Retiree is reemployed by the Employer, except as provided in Section 3.6; or C) the Eligible Retiree's death, except benefits may continue to the Eligible Retiree's Beneficiary in accordance with Appendix A, Section A.4. 3.6 Reemployed Retirees. If the Employer reemploys an Eligible Retiree, any benefits provided under the Plan to that Eligible Retiree will cease effective on the reemployment date and his or her Plan participation will cease. The Eligible Retiree will be entitled to benefits under the Plan upon subsequent termination of employment only if he or she is then eligible under this Article I II. If, however, after the reemployment date, the reemployed Eligible Retiree is entitled to continued receipt of retirement benefits under CCCERA as a retiree of the Employer and continues to be eligible for both the MEC and retiree coverage under CalPERS Health, any benefits provided under the Plan to that Eligible Retiree will continue uninterrupted. 3 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 126 of 549 Page 109 of 138 ARTICLE IV VESTING AND BENEFITS 4.1 Amount of Benefits. Each Eligible Retiree will be entitled to receive Employer-funded health care reimbursements as specified in Appendix A and paid in accordance with Section 4.2. The maximum benefit on behalf of an Eligible Retiree for any calendar month will be the amount established and set forth in Appendix A. In no event, however, will the benefit paid in any calendar month on behalf of any Eligible Retiree be greater than the Eligible Retiree's actual out-of-pocket premium cost for CaIPERS Health coverage for that calendar month. An Eligible Retiree may at any time decline benefits under the Plan by notifying the Employer. 4.2 Reimbursements Under the Plan. Benefits under the Plan will be provided in the form of monthly reimbursements of the health care coverage premium costs incurred by the Eligible Retiree (or Beneficiary) for the coverage under the CaIPERS Health option that the Eligible Retiree has elected for the applicable Plan Year, up to the maximum amount specified in Appendix A. In addition, the Plan will reimburse the Medicare Part A and Part B premium costs incurred by a Tier I or Tier II Eligible Retiree or his or her eligible dependents as set forth in Appendix A. Finally, in lieu of the Any such premium costs may not be paid or reimbursed from any other source and must be substantiated in accordance with Section 4.3. Under no circumstances will unused amounts for one calendar month be applied to costs in any subsequent calendar month and no unused amounts may roll over to any subsequent Plan Year. The Eligible Retiree will be solely responsible for paying the coverage cost of any amounts that are not reimbursed under this Plan or otherwise paid by the Employer. 4.3 Substantiation of Expenses. Reimbursements of health care premium expenses under the Plan for an Eligible Retiree's (or a Beneficiary's) individual coverage under CaIPERS Health or Medicare must be properly documented and substantiated at the time and in the manner determined by the Plan Administrator. The Plan Administrator has authority to establish rules and procedures to be followed by individuals in filing applications for benefits, for furnishing and verifying proofs necessary to establish their rights to benefits under the Plan, or for any other reason it deems necessary for the efficient administration of the Plan. Upon satisfactory documentation and substantiation, the Plan Administrator will direct payment to the Eligible Retiree (or Beneficiary) as soon as administratively feasible. ARTICLE V BENEFIT FUNDING 5.1 Employer Contributions. All benefits under the Plan will be paid by Employer contributions and earnings thereon. Employee contributions are not permitted. In addition, the Employer may set aside contributions and related earnings to pre-fund benefits under the Plan. In determining the amount of any such contributions, the Employer may engage an actuary to conduct actuarial experience studies and periodic actuarial valuations of the Plan benefits and to recommend to the Employer the amount of contributions that are needed in order to fund the Plan's benefits. 5.2 Trust. The Employer may establish or adopt a Trust to receive and invest assets set aside by the Employer to pay benefits under the Plan. The Trust may specifically provide, among other things, for the investment and reinvestment of the Trust assets and the income thereof, the management of the Trust assets, the responsibilities and immunities of the trustee, removal of the trustee and appointment of a successor, accounting by the trustee and the disbursement of the Trust assets. The trustee will, in accordance with the terms of the Trust, 4 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 127 of 549 Page 110 of 138 accept and receive all contributions paid to it from time to time, and shall hold, invest, reinvest and manage such moneys and any increment, increase, earnings and income thereof for the exclusive benefit of Eligible Retirees and Beneficiaries and for the payment of reasonable expenses of administering the Plan. ARTICLE VI ADMINISTRATION OF THE PLAN 6.1 Plan Administrator. The administration of this Plan will be under the supervision of the Plan Administrator. It is the principal duty of the Plan Administrator to see that this Plan is carried out, in accordance with its terms, for the exclusive benefit of persons entitled to participate in this Plan. 6.2 Powers of the Plan Administrator. The Plan Administrator will have such duties and powers as it considers necessary or appropriate to discharge its duties. It will have the exclusive right to interpret the Plan and to decide all matters thereunder, and all determinations of the Plan Administrator with respect to any matter hereunder will be conclusive and binding on all persons. Without limiting the generality of the foregoing, the Plan Administrator will have the following discretionary authority: a) to construe and interpret the Plan, including all possible ambiguities, inconsistencies, and omissions in the Plan and related documents, and to decide all questions of fact, questions relating to eligibility and participation, and questions of benefits under the Plan; b) to prescribe procedures to be followed and the forms to be used by Eligible Retirees and Beneficiaries to claim reimbursements under the Plan; C) to prepare and distribute information explaining the Plan and the benefits under the Plan in such manner as the Plan Administrator determines to be appropriate; d) to request and receive from all Eligible Retirees and Beneficiaries such information as the Plan Administrator will from time to time determine to be necessary for the proper administration of the Plan; e) to furnish each Eligible Retiree and Beneficiary with such reports with respect to the administration of the Plan as the Plan Administrator determines to be reasonable and appropriate; f) to receive, review, and keep on file such reports and information regarding the benefits covered by the Plan as the Plan Administrator determines from time to time to be necessary and proper; g) to appoint and employ such individuals or entities to assist in the administration of the Plan as it determines to be necessary or advisable, including legal counsel and benefit consultants; h) to sign documents for the purposes of administering the Plan, or to designate an individual or individuals to sign documents for the purposes of administering the Plan; 5 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 128 of 549 Page 111 of 138 i) to secure or require such evidence as it deems necessary to decide any claim for benefits under the Plan; and j) to maintain the books of accounts, records, and other data in the manner necessary for proper administration of the Plan and to meet any applicable disclosure and reporting requirements. 6.3 Fiduciary Duties. Each Plan fiduciary shall discharge its duties solely in the interest of Eligible Retirees and Beneficiaries and for the exclusive purpose of providing benefits under the Plan, or defraying reasonable expenses of administering the Plan. Each Plan fiduciary, in carrying out such duties and responsibilities, shall act with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use. A fiduciary may serve in more than one fiduciary capacity and may employ one or more persons to render advice with regard to its fiduciary responsibilities. If the fiduciary is serving as such without compensation, all expenses reasonably incurred by such fiduciary will be paid by the Employer. The Employer may, however, elect to have those expenses paid from Trust assets. 6.4 Provision for Third-Party Plan Service Providers. The Plan Administrator, subject to approval of the Employer, may employ the services of such persons as it may deem necessary or desirable in connection with the operation of the Plan. Unless otherwise provided in the service agreement, obligations under the Plan shall remain the obligation of the Employer or Plan Administrator, as applicable. 6.5 Inability to Locate Payee. If the Plan Administrator is unable to make payment to any person to whom a payment is due under the Plan because it cannot ascertain the identity or whereabouts of such person after reasonable efforts have been made to identify or locate such person, then such payment and all subsequent payments otherwise due to such person will be forfeited following a reasonable time after the date any such payment first became due. 6.6 COBRA and HIPAA Compliance. The Plan will comply with the applicable requirements of COBRA, and with the applicable requirements of HIPAA in accordance with the rules set out in Appendix B. ARTICLE VII AMENDMENT AND TERMINATION OF THE PLAN 7.1 No Vested Rights. The Employer may at any time amend or terminate the Plan as provided in Sections 7.2 and 7.3. Nothing in the Plan is intended to or will be construed to entitle any Eligible Retiree or other person to vested or non-terminable benefits. 7.2 Amendment of the Plan. The Employer may amend all or any part of this Plan at any time for any reason by resolution of the Board of Directors or by any person or persons authorized by the Board of Directors to take such action. Any such amendment will supersede and override any claim to "vested rights" that any person may otherwise have with respect to benefits under the Plan. 7.3 Termination of the Plan. a) The Employer has established the Plan with the expectation that it will be continued, but continuance is not a contractual or other obligation of the 6 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 129 of 549 Page 112 of 138 Employer and no employee of the Employer or other person will have any vested right to continuance of the Plan or to continuance of any Employer contributions to the Plan. The Employer reserves the right at any time to terminate the Plan without prejudice and for any reason, and such termination will supersede and override any claim to "vested rights" that any person may otherwise have with respect to benefits under the Plan. Such decision to terminate the Plan will be made in writing and must be approved by the Board of Directors. b) If the Plan is terminated, the Employer shall direct the trustee to compute the value of the Plan assets under the Trust as of the date of termination. Those assets will continue to be held in the Trust, and will be distributed to pay any remaining benefits owed under the Plan until those benefits are satisfied. C) The "partial termination" rules of the Code that apply to qualified retirement plans will not apply under this Plan, and no action will be taken with respect to this Plan in connection with any event or events that would be a partial termination for a qualified plan. 7.4 Compliance with Labor Laws. Notwithstanding Sections 7.1 through 7.3, all amendments to the Plan or any person's benefits under the Plan will conform with any applicable requirements of the Meyers-Milias-Brown Act, including but not limited to any meet- and-confer requirements. 7.5 Determination of Effective Date of Amendment or Termination. Any such amendment, discontinuance or termination will be effective as of the date the Employer determines. 7.6 Assets After Termination. Any assets remaining in the Trust after all benefits owed under the Plan and all Plan expenses have been paid will revert to the Employer unless otherwise determined by the Employer. 7.7 Limitation of Obligations. The Employer must provide all benefits accrued by Eligible Retirees or Beneficiaries under the Plan through its termination. Once those benefits are satisfied, the Employer will not have any remaining obligations to provide any benefit under the Plan. No one will accrue benefits under the Plan after its termination. ARTICLE VIII GENERAL PROVISIONS 8.1 Governing Law. The provisions of the Plan will be construed, administered and enforced according to applicable federal law and, to the extent not preempted, the laws of the State of California. 8.2 Requirement for Proper Forms. All communications in connection with the Plan made by an Eligible Retiree or Beneficiary will become effective only when duly executed on any forms as may be required and furnished by, and filed with, the Employer or Plan Administrator, as applicable. 8.3 No Guarantee of Tax Consequences. This Plan is intended to permit an Eligible Retiree or Beneficiary to obtain reimbursement benefits under this Plan on a nontaxable basis. Neither the Employer nor any Plan Administrator, however, makes any warranty or other 7 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 130 of 549 Page 113 of 138 representation as to whether any benefits under the Plan will be treated as excludable from gross income for federal, state, or local income tax purposes. If for any reason it is determined that any amount paid for the benefit of an Eligible Retiree or Beneficiary is includable in gross income for federal, state or local income tax purposes, then under no circumstances will the recipient have any recourse against the Employer or Plan Administrator with respect to any increased taxes or other losses or damages suffered by the Eligible Retiree or Beneficiary as a result thereof. To the extent required by the Code, the Employer will follow the tax withholding and reporting requirements applicable to benefits paid under this Plan to or for a non-dependent domestic partner. 8.4 Compliance With Code and Other Applicable Laws. It is intended that this Plan meet all applicable requirements of the Code and all regulations and guidance issued thereunder. This Plan will be construed, operated and administered accordingly, and in the event of any conflict between any part, clause, or provision of this Plan and the Code, the provisions of the Code will be deemed controlling, and any conflicting part, clause, or provision of this Plan will be deemed superseded to the extent of the conflict. In addition, the Plan will comply with the requirements of all other applicable laws. 8.5 Headings. The headings of the various articles and sections are inserted for convenience of reference and are not to be regarded as part of the Plan or as indicating or controlling the meaning or construction of any provision. 8.6 Severability. Should any part of this Plan subsequently be invalidated by a court of competent jurisdiction, the remainder of the Plan will be given effect to the maximum extent possible. 8.7 Administration Expenses. The Employer will pay the reasonable expenses of administering the Plan, including but not limited to the reasonable compensation of any counsel, accountants, and other agents hired by the Employer, Plan Administrator, or Board of Directors, as well as any other expenses incurred in administering the Plan. The Employer may, however, elect to have those expenses paid from Trust assets. 8.8 Effect of Mistake. In the event of a mistake as to the eligibility or participation of an individual, or the allocations made with respect to any Eligible Retiree, or the amount of distributions made or to be made to an Eligible Retiree or other person, the Employer or Plan Administrator will, to the extent it deems possible, cause to be allocated or cause to be withheld or accelerated, or otherwise make adjustment of, such amounts as will in its judgment accord to such Eligible Retiree or other person that to which he or she is properly entitled under the Plan. 8.9 No Contract of Employment. The Plan does not provide any person with any right to be retained in the Employer's employment or service. An Eligible Retiree's sole rights under the Plan are limited to those described in this document. 8.10 Plan Provisions Controlling. The Plan encompasses the benefits provided by the Employer to Eligible Retirees. In the event that the terms or provisions of any summary or description of this Plan are interpreted as being in conflict with the provisions of this Plan as set forth in this document, the provisions of this Plan will be controlling. 8.11 Non-Assignability of Rights. The right of any Eligible Retiree or Beneficiary to receive any reimbursement under this Plan will not be alienable by the Eligible Retiree or Beneficiary by assignment or any other method and will not be subject to claims by his or her creditors by any 8 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 131 of 549 Page 114 of 138 process whatsoever. Any attempt to cause such right to be so subjected will not be recognized, except to the extent required by law. 8.12 Provisions Applicable During Periods of Military Service. Notwithstanding any Plan provision to the contrary, contributions, benefits, and service credit with respect to qualified military service will be provided as required by any law concerning veterans' rights. To record the adoption of the Plan, the Employer's authorized representative hereby executes this document on this day of 2018. Central Contra Costa Sanitary District By: Title: 9 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 132 of 549 Page 115 of 138 APPENDIX A: RETIREE BENEFITS Each Eligible Retiree is eligible to receive Employer-funded health care reimbursements as specified in this Appendix A and paid in accordance with Section 4.2. The MEC is a separate benefit from the reimbursement benefits available under this Plan. The Employer pays the MEC directly to CalPERS on behalf of Eligible Retirees. A.1 Tier I: Employees hired before May 1, 1985 Each Employee hired by the Employer before May 1, 1985 will become an Eligible Retiree only if(a) the sum of his or her age plus years of Employer service is equal to at least 65, and (b) he or she has reached age 50 and completed at least ten years of continuous Employer service. Each Eligible Retiree described in the preceding sentence will be eligible to receive a monthly premium reimbursement benefit under the Plan of up to: a) 100% of the monthly premium for the highest-cost Core Plan (Kaiser Permanente Plan or Health Net SmartCare Plan for Eligible Retirees and eligible dependents who younger than age 65; Kaiser Permanente Senior Advantage Plan or United Healthcare Group Medicare Advantage PPO Plan for Eligible Retirees and eligible dependents who are age 65 or older) with the highest such premium for the Eligible Retiree and his or her eligible dependents, minus b) the MEC. A.2 Tier II: Employees hired on or after May 1, 1985 and on or before June 30, 2009 Each Employee hired by the Employer on or after May 1, 1985, and on or before June 30, 2009, will become an Eligible Retiree only if(a) the sum of his or her age plus years of Employer service is equal to at least 65, and (b) he or she has reached age 50 (age 55 for Management and MS/CG Employees hired after April 18, 2003) and completed at least ten years of continuous Employer service. Each Eligible Retiree described in the preceding sentence will be eligible to receive a monthly premium reimbursement under the Plan of up to: a) 100% of the monthly premium for the Core Plan with the highest such premium for the Eligible Retiree or his or her eligible dependents who are younger than age 65, plus b) 50% of the monthly premium for the Core Plan with the highest such premium, for the Eligible Retiree or his or her eligible dependents who are age 65 or older, minus C) the MEC. A.3 Tier III: Employees hired after June 30, 2009 Each Employee hired by the Employer after June 30, 2009, will become an Eligible Retiree only if(a) the sum of his or her age plus years of Employer service is equal to at least 70, and (b) he or she has reached age 55 and has completed at least ten years of continuous Employer A-1 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 133 of 549 Page 116 of 138 service. Each Eligible Retiree described in the preceding sentence will be eligible to receive a monthly premium reimbursement benefit under the Plan of up to: a) 50% of the monthly premium for the Core Plan with the highest such premium for the Eligible Retiree and his or her spouse or domestic partner, minus b) the MEC. A.4 Beneficiaries If an Eligible Retiree dies, or if an Employee who is eligible to retire dies prior to retirement, benefits will be provided under the Plan to the Eligible Retiree's or Employee's Beneficiary, if any, but only if the individual is (a) eligible for coverage under CaIPERS Health, and (b) entitled to the MEC from the Employer. Benefits will be provided under the Plan to such Beneficiary only during such periods that he or she meets these two requirements. The Beneficiary will not be entitled to any benefits under the Plan for any period he or she does not meet these two requirements. In the case of an Employee who is eligible to retire, but dies prior to retirement, the Employee's date of death will be deemed his or her date of retirement for the sole purpose of determining his or her Beneficiary's reimbursement benefit amount, if any, under this Section A.4. The Beneficiary will be eligible for the same reimbursement benefit that applied to the Eligible Retiree or would have applied to the Employee had the Employee retired on his or her date of death. A.5 Medicare Premium Reimbursement The Plan will reimburse the costs incurred by a Tier I or Tier II Eligible Retiree or his or eligible dependents for Medicare Part A or Part B premiums upon satisfactory documentation and substantiation of the expenses under Section 4.3; provided, however, that the Plan will not reimburse any portion of such premium attributable to penalties or increased costs due to the individual's failure to timely enroll in Medicare. The Plan will not reimburse any Medicare premium expenses incurred by Tier III Eligible Employees or their eligible dependents. A.6 Reimbursement of Non-CaIPERS Health Insurance Premiums Notwithstanding any contrary Plan provision, if an Eligible Retiree does not enroll in CaIPERS Health (or if an Employee who upon termination of employment with the Employer satisfies the eligibility requirements for Tier I, Tier II, or Tier III and fails to satisfy the eligibility requirements for CaIPERS Health) and instead enrolls in non-CaIPERS Health insurance coverage, the Plan will, in lieu of reimbursement of the cost of CalPERS Health premiums described above, reimburse the costs incurred by the individual for the non-CaIPERS Health premiums for the individual and his or her spouse or eligible dependents (as applicable based on the tier for which the individual is eligible) up to the applicable percentage (based on the tier for which the individual is eligible) of the monthly premium for the Core Plan with the highest such premium upon satisfactory documentation and substantiation of the expenses under Section 4.3. A-2 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 134 of 549 Page 117 of 138 APPENDIX B: HIPAA COMPLIANCE 13.1 Provision of Protected Health Information to Employer Members of the Employer's workforce have access to the individually identifiable health information of Plan participants for administrative functions of the Plan. When this health information is provided from the Plan to the Employer, it is Protected Health Information (PHI). The Health Insurance Portability and Accountability Act of 1996 (HIPAA) and its implementing regulations restrict the Employer's ability to use and disclose PHI. The following HIPAA definition of PHI applies for purposes of this Appendix A: Protected Health Information. Protected health information means information that is created or received by the Plan and relates to the past, present, or future physical or mental health or condition of a participant; the provision of health care to a participant; or the past, present, or future payment for the provision of health care to a participant; and that identifies the participant or for which there is a reasonable basis to believe the information can be used to identify the participant. Protected health information includes information of persons living or deceased. The Employer will have access to PHI from the Plan only as permitted under this Appendix A or as otherwise required or permitted by HIPAA. HIPAA and its implementing regulations were modified by the Health Information Technology for Economic and Clinical Health Act (HITECH Act), the statutory provisions of which are incorporated herein by reference. 13.2 Permitted Disclosure of Enrollment/Disenrollment Information The Plan may disclose to the Employer information on whether the individual is participating in the Plan. 13.3 Permitted Uses and Disclosure of Summary Health Information The Plan may disclose Summary Health Information to the Employer, provided that the Employer requests the Summary Health Information for the purpose of modifying, amending, or terminating the Plan. "Summary Health Information" means information (a) that summarizes the claims history, claims expenses, or type of claims experienced by individuals for whom a plan sponsor had provided health benefits under a health plan; and (b)from which the information described at 42 CFR Section 164.514(b)(2)(i) has been deleted, except that the geographic information described in 42 CFR Section 164.514(b)(2)(i)(B) need only be aggregated to the level of a five-digit ZIP code. 13.4 Permitted and Required Uses and Disclosure of PHI for Plan Administration Purposes Unless otherwise permitted by law, and subject to the conditions of disclosure described in Section B.5 and obtaining written certification pursuant to Section 13.7, the Plan may disclose PHI to the Employer, provided that the Employer uses or discloses such PHI only for Plan administration purposes. "Plan administration purposes" means administration functions performed by the Employer on behalf of the Plan, such as quality assurance, claims processing, B-1 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 135 of 549 Page 118 of 138 auditing, and monitoring. Plan administration functions do not include functions performed by the Employer in connection with any other benefit or benefit plan of the Employer, and they do not include any employment-related functions. Notwithstanding the provisions of this Plan to the contrary, in no event will the Employer be permitted to use or disclose PHI in a manner that is inconsistent with 45 CFR Section 164.504(f). B.5 Conditions of Disclosure for Plan Administration Purposes The Employer agrees that with respect to any PHI (other than enrollment/disenrollment information and Summary Health Information, which are not subject to these restrictions) disclosed to it by the Plan, the Employer will: not use or further disclose the PHI other than as permitted or required by the Plan or as required by law; • ensure that any agent, including a subcontractor, to whom it provides PHI received from the Plan agrees to the same restrictions and conditions that apply to the Employer with respect to PHI; not use or disclose the PHI for employment-related actions and decisions or in connection with any other benefit or employee benefit plan of the Employer; • report to the Plan any use or disclosure of the information that is inconsistent with the uses or disclosures provided for of which it becomes aware; make available PHI to comply with HIPAA's right to access in accordance with 45 CFR Section 164.524; • make available PHI for amendment and incorporate any amendments to PHI in accordance with 45 CFR Section 164.526; • make available the information required to provide an accounting of disclosures in accordance with 45 CFR Section 164.528; • make its internal practices, books, and records relating to the use and disclosure of PHI received from the Plan available to the Secretary of Health and Human Services for purposes of determining compliance by the Plan with HIPAA's privacy requirements; • if feasible, return or destroy all PHI received from the Plan that the Employer still maintains in any form and retain no copies of such information when no longer needed for the purpose for which disclosure was made, except that, if such return or destruction is not feasible, limit further uses and disclosures to those purposes that make the return or destruction of the information infeasible; and • ensure that the adequate separation between the Plan and the Employer (i.e., the "firewall"), required in 45 CFR Section 504(f)(2)(iii) is satisfied. B-2 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 136 of 549 Page 119 of 138 The Employer further agrees that if it creates, receives, maintains, or transmits any electronic PHI (other than enrollment/disenrollment information and Summary Health Information, which are not subject to these restrictions) on behalf of the Plan, it will implement administrative, physical, and technical safeguards that reasonably and appropriately protect the confidentiality, integrity, and availability of the electronic PHI, and it will ensure that any agents (including subcontractors) to whom it provides such electronic PHI agree to implement reasonable and appropriate security measures to protect the information. The Employer will report to the Plan any security incident of which it becomes aware. B.6 Adequate Separation Between Plan and Employer The Employer will allow the following persons access to PHI: the Human Resources Director, the Plan Administrator, and any other Employee who needs access to PHI in order to perform Plan administration functions that the Employer performs for the Plan (such as quality assurance, claims processing, auditing, and monitoring). No other persons will have access to PHI. These specified employees (or classes of employees) will only have access to and use PHI to the extent necessary to perform the plan administration functions that the Employer performs for the Plan. In the event that any of these specified employees does not comply with the provisions of this Section, that employee will be subject to disciplinary action by the Employer for non-compliance pursuant to the Employer's employee discipline and termination procedures. The Employer will ensure that the provisions of this Section B.6 are supported by reasonable and appropriate security measures to the extent that the designees have access to electronic PHI. B.7 Certification of Plan Sponsor The Plan will disclose PHI to the Employer only upon the receipt of a certification by the Employer that the Plan incorporates the provisions of 45 CFR Section 164.504(f)(2)(ii), and that the Employer agrees to the conditions of disclosure set forth in Section B.S. Execution of the Plan by the Employer will serve as the required certification. B.8 Privacy Official The Employer will designate a Privacy Official, who will be responsible for the Plan's compliance with HIPAA. The Privacy Official may contract with or otherwise utilize the services of attorneys, accountants, brokers, consultants, or other third party experts as the Privacy Official deems necessary or advisable. In addition and notwithstanding any provision of this Plan to the contrary, the Privacy Official will have the authority to and be responsible for: • accepting and verifying the accuracy and completeness of any certification provided by the Employer under this Appendix; • transmitting the certification to any third parties as may be necessary to permit them to disclose PHI to the Employer; • establishing and implementing policies and procedures with respect to PHI that are designed to ensure compliance by the Plan with the requirements of HIPAA; B-3 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 137 of 549 Page 120 of 138 • establishing and overseeing proper training of personnel who will have access to PHI; and • any other duty or responsibility that the Privacy Official, in his or her sole capacity, deems necessary or appropriate to comply with the provisions of HIPAA and the purposes of this Appendix B. 13.9 Interpretation and Limited Applicability This Appendix serves the sole purpose of complying with the requirements of HIPAA and will be interpreted and construed in a manner to effectuate this purpose. Neither this Appendix nor the duties, powers, responsibilities, and obligations listed herein will be taken into account in determining the amount or nature of the benefits provided to any person covered under the Plan, nor will they inure to the benefit of any third parties. To the extent that any of the provisions of this Appendix A are no longer required by HIPAA or do not apply to the Plan because the Plan is otherwise excepted from HIPAA, they will be deemed deleted and will have no force or effect. 13.10 Service Performed for the Employer Notwithstanding any other provisions of this Plan to the contrary, all services performed by a business associate for the Plan in accordance with the applicable service agreement will be deemed to be performed on behalf of the Plan and subject to the administrative simplification provisions of HIPAA contained in 45 CFR Parts 160 through 164, except services that relate to eligibility and enrollment in the Plan. If a business associate of the Plan performs any services that relate to eligibility and enrollment in the Plan, these services will be deemed to be performed on behalf of the Employer in its capacity as Plan Sponsor and not on behalf of the Plan. B-4 15000696.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 138 of 549 Page 121 of 138 ATTACHMENT 6 CENTRAL CONTRA COSTA SANITARY DISTRICT HEALTH REIMBURSEMENT ARRANGEMENT FOR TIER III EMPLOYEES REPRESENTED BY THE MANAGEMENT SUPPORT/CONFIDENTIAL GROUP AND THE PUBLIC EMPLOYEES UNION, LOCAL 1 Effective July 1, 2019 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 139 of 549 Page 122 of 138 TABLE OF CONTENTS PAGE ARTICLE I ESTABLISHMENT AND PURPOSE OF THE PLAN ..................................................1 ARTICLE II DEFINITIONS............................................................................................................1 ARTICLE III ELIGIBILITY AND PARTICIPATION ........................................................................3 ARTICLE IV CONTRIBUTIONS AND FUNDING..........................................................................4 ARTICLE V VESTING AND BENEFITS .......................................................................................4 ARTICLE VI APPEALS PROCEDURE.........................................................................................7 ARTICLE VII PLAN ADMINISTRATION .......................................................................................8 ARTICLE VIII AMENDMENT AND TERMINATION OF THE PLAN .............................................9 ARTICLE IX GENERAL PROVISIONS.......................................................................................10 APPENDIX A: HIPAA COMPLIANCE......................................................................................A-1 i 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 140 of 549 Page 123 of 138 CENTRAL CONTRA COSTA SANITARY DISTRICT HEALTH REIMBURSEMENT ARRANGEMENT FOR TIER III EMPLOYEES REPRESENTED BY THE MANAGEMENT SUPPORT/CONFIDENTIAL GROUP AND THE PUBLIC EMPLOYEES UNION, LOCAL 1 Effective July 1, 2019 ARTICLE I ESTABLISHMENT AND PURPOSE OF THE PLAN The Central Contra Costa Sanitary District (the Employer) hereby establishes this Central Contra Costa Sanitary District Health Reimbursement Arrangement for Tier II I Employees Represented by the Management Support/Confidential Group and the Public Employees Union, Local 1 (the Plan), effective July 1, 2019 (the Effective Date) to enable Eligible Employees to, upon termination of employment with the Employer, obtain reimbursement of post-employment Medical Care Expenses. The Plan is intended to qualify as a health reimbursement arrangement within the meaning of Internal Revenue Service Notice 2002-45, and it is intended that the benefits under the Plan be tax-free to the maximum extent permitted under the Internal Revenue Code and the regulations issued thereunder. The Plan will be administered and interpreted to accomplish that objective. Capitalized terms used in this Plan that are not otherwise defined have the meanings set forth in Article II. ARTICLE II DEFINITIONS 2.1 "Board of Directors" means the governing body of the Employer. 2.2 "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended. 2.3 "Code" means the Internal Revenue Code of 1986 and the Treasury Regulations and guidance issued thereunder, as amended. 2.4 "Dependent" means (a) a dependent as defined in Code Section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof, and (b) any child (as defined in Code Section 152(f)) of the Participant who as of the end of the taxable year has not attained age 27. 2.5 "Effective Date" means July 1, 2019. 2.6 "Eligible Employee" is defined in Section 3.1 2.7 "Employee" means a person whom the Employer classifies as a common-law employee and who is on the Employer's W-2 payroll, but does not include the following: (a) any 1 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 141 of 549 Page 124 of 138 leased employee (including but not limited to those individuals defined as leased employees in Code Section 414(n)) or an individual classified by the Employer as a contract worker, independent contractor, temporary employee, or casual employee for the period during which such individual is so classified, whether or not any such individual is on the Employer's W-2 payroll or is determined by the IRS or others to be a common-law employee of the Employer; and (b) any individual who performs services for the Employer but who is paid by a temporary or other employment or staffing agency for the period during which such individual is paid by such agency, whether or not such individual is determined by the IRS or others to be a common-law employee of the Employer. 2.8 "Employer" means the Central Contra Costa Sanitary District. 2.9 "Employer Contributions" means the amounts the Employer contributes to Participants' HRA Accounts in accordance with Section 4.1. 2.10 "FMLA" means the Family Medical Leave Act of 1993, as amended. 2.11 "HIPAA" means the Health Insurance Portability and Accountability Act of 1996, as amended. 2.12 "HRA Account" means an account described in Section 5.7. 2.13 "PEU Local 1" means the Central Contra Costa Sanitary District Employees' Association, Public Employees Union, Local 1, the formally recognized exclusive employee representative for all regular and permanent-intermittent General Employees. 2.14 "Medical Care Expenses" are defined in Section 5.5(b). 2.15 "MS/CG" means the Management Support/Confidential Group, the formally recognized exclusive employee representative for all regular Employees, other than General Employees, Management Employees, and Executive Management Employees, who are currently designated by resolution of the Board of Directors. 2.16 "Participant" means an Eligible Employee who has satisfied the requirements to participate in the Plan in Section 3.2 and whose participation in the Plan has not terminated under Section 3.5. 2.17 Period of Coverage" is defined in Section 5.3. 2.18 "Plan" means this Central Contra Costa Sanitary District Health Reimbursement Arrangement for Tier III Employees Represented by the Management Support/Confidential Group and the Public Employees Union, Local 1, as set forth herein and amended from time to time. 2.19 "Plan Administrator" means the Employer unless the Employer designates another person or organization to hold the position of Plan Administrator. The Employer may alternatively designate another person or organization to perform certain duties assigned to the Plan Administrator under this Plan. 2.20 "Plan Year" means the calendar year (i.e., the 12-month period commencing January 1 and ending on December 31). 2 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 142 of 549 Page 125 of 138 2.21 "Trust" means the legal entity that the Employer establishes or adopts to hold any assets it has irrevocably set aside to pay benefits under the Plan in accordance with Section 4.3. 2.22 "USERRA" means the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended. ARTICLE III ELIGIBILITY AND PARTICIPATION 3.1 Eligible Employee. "Eligible Employee" means each regular or probationary full-time Employee who is: a) represented by the PEU Local 1 or the MS/CG or successor associations; and b) hired by the Employer after June 30, 2009. 3.2 Commencement of Participation. Each Eligible Employee on the Effective Date will participate in the Plan on that date. Each other Employee will become a Participant, eligible to have Employer Contributions made to an HRA Account under Section 4.1, when he or she becomes an Eligible Employee. 3.3 No Benefits Unless Eligible. An Employee will not have any interest under the Plan unless and until he or she satisfies all of the requirements under Section 3.1. Any person who does not satisfy these requirements will not be entitled to any benefits under the Plan. 3.4 Termination of Participation. A Participant's participation in the Plan terminates upon the earliest of: a) the Participant's ceasing to be an Eligible Employee or exhaustion of his or her HRA Account, whichever occurs later; b) the Participant's death without a surviving spouse or Dependent; or C) the Plan's termination date. 3.5 Reemployment. If the Employer reemploys a Participant, the Participant's coverage and any reimbursements provided under the Plan to that Participant will cease upon reemployment. The Participant will not be entitled to coverage or any reimbursements under the Plan until his or her subsequent termination of employment. If the Participant is reemployed as an Eligible Employee, he or she will resume participation in the Plan upon reemployment solely for purposes of eligibility to have Employer Contributions made to an HRA Account under Section 4.1 until his or her subsequent termination of employment. If a Participant is reemployed in an ineligible classification (e.g., part-time, temporary, or a classification represented by different bargaining unit) he or she will again have to satisfy the requirements in Section 3.1 before he or she can resume participation in the Plan for purposes of eligibility to have Employer Contributions made to an HRA Account under Section 4.1. 3 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 143 of 549 Page 126 of 138 ARTICLE IV CONTRIBUTIONS AND FUNDING 4.1 Employer Contributions. Each month, the Employer will contribute an Employer Contribution to the HRA Account of each Participant who is an Eligible Employee during the month equal to 1.5% of the Participant's base salary for the month. 4.2 Employee Contributions. Employee contributions are not permitted under the Plan. 4.3 Trust. The Employer will establish or adopt a tax-exempt irrevocable Trust to hold Plan assets. The Trust will specifically provide, among other things, for the investment and reinvestment of the Trust assets and the income thereof, the management of the Trust assets, the responsibilities and immunities of the trustee, removal of the trustee and appointment of a successor, accounting by the trustee and the disbursement of the Trust assets. The trustee will, in accordance with the terms of the Trust, accept and receive all contributions paid to it by the Employer, and shall hold, invest, reinvest and manage such moneys and any increment, increase, earnings and income thereof for the exclusive benefit of Participants and their spouses and Dependents and for the payment of reasonable expenses of administering the Plan. 4.4 Participant-Directed Investments. Each Participant may, at the time and manner prescribed by the Plan Administrator, direct the trustee to invest the Participant's HRA Account in specific assets, investment funds or other investments permitted under the Trust. If a Participant fails to designate the permitted assets, investment fund or other investments in which his or her HRA Account is invested, his or her HRA Account will be invested in the investment fund designated by the Plan Administrator. Upon the Participant's death, the Participant's surviving spouse will have the same right to direct the investment of, and receive benefits from, the Participant's HRA Account. If the Participant does not have a surviving spouse or upon the surviving spouse's death, the Participant's Dependents will have the same right to direct the investment of, and receive benefits from, in shares designated by the Participant in writing at the time and manner prescribed by the Plan Administrator, of the Participant's HRA Account. If the Participant properly designates those shares, and the number of the Participant's Dependents subsequently changes, the Participant must make a new designation in the same manner. If the Participant fails to properly designate those shares, either initially or subsequently upon a change in the number of his or her Dependents, the Participant's Dependents will have the same right to direct the investment of, and receive benefits from, equal shares of the Participant's HRA Account. To the maximum extent permitted by law, no Plan fiduciary, including the Employer, the trustee, or the Plan Administrator, will be liable for any losses which are the direct and necessary result of investment instructions by a Participant or his or her spouse or Dependents. Any fees or expenses incurred in connection with a Participant's investment direction and any fees or expenses associated with a particular investment option, including but not limited to brokerage, investment advisor and management fees, will be charged to the Participant's HRA Account. ARTICLE V VESTING AND BENEFITS 5.1 Vesting. A Participant's HRA Account is immediately 100% non-forfeitable to the extent of contributions made to such HRA Account. 4 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 144 of 549 Page 127 of 138 5.2 Benefit Eligibility. A Participant will not become eligible to receive reimbursements under the Plan until he or she terminates employment with the Employer. Upon termination of employment, a Participant will be eligible to receive reimbursements under the Plan during a Period of Coverage. 5.3 Period of Coverage. Each Participant's Period of Coverage for reimbursements begins when he or she terminates District employment and ends if and when he or she is reemployed by the Employer. Therefore, Medical Care Expenses incurred by a Participant before such termination or during any reemployment will not be eligible for reimbursement under the Plan. 5.4 Benefits. The Plan will reimburse each eligible Participant's Medical Care Expenses up to the unused amount in the Participant's HRA Account as set forth and adjusted under Section 5.6. 5.5 Eligible Medical Care Expenses. Under the HRA Account, a Participant may receive reimbursement for Medical Care Expenses incurred during a Period of Coverage. a) Incurred. A Medical Care Expense is incurred at the time the medical care or service giving rise to the expense is furnished, and not when the individual incurring the expense is formally billed for, is charged for, or pays for the medical care. Medical Care Expenses incurred before a Participant first becomes covered by the Plan are not eligible. b) Medical Care Expenses Generally. "Medical Care Expenses" means expenses incurred by a Participant or his or her spouse or Dependents for medical care, as defined in Code section 213(d) (including, for example, amounts for certain hospital, doctor, and dental bills), but will exclude expenses that are described in Section 5.5(c). Reimbursements due for Medical Care Expenses incurred by the Participant or the Participant's spouse or Dependents will be charged against the Participant's HRA Account. C) Medical Care Expenses Exclusions. "Medical Care Expenses" exclude (1) unprescribed medicines or drugs (other than insulin), without regard to whether such medicine or drug could be obtained without a prescription, (2) qualified long-term care services, (3) cosmetic surgery or other similar procedures, unless the surgery or procedure is necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease (for this purpose, "cosmetic surgery" means any procedure that is directed at improving the patient's appearance and does not meaningfully promote the proper function of the body or prevent or treat illness or disease), and (4) any other expense that does not constitute "medical care" as defined under Code section 213(d) or is otherwise excluded under the terms of the Plan. "Qualified long-term care services" means necessary diagnostic, preventative, therapeutic, curing, treating, mitigating and rehabilitative services, and "maintenance or personal care services," which are: (1) required by a "chronically ill" individual; and (2) provided pursuant to a plan of care prescribed by a licensed health care practitioner. An individual is "chronically ill" if, within the previous 12 months, a licensed health care practitioner has certified that the individual either: (1) is unable to perform at least two daily living activities (eating, toileting, transferring, bathing, dressing, and continence) without substantial assistance from another individual for at least 5 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 145 of 549 Page 128 of 138 90 days; or (2) requires substantial supervision to protect the individual from threats to health and safety due to severe cognitive impairment. "Maintenance or personal care services" means services the primary purpose of which are to provide a chronically ill individual with needed assistance with his or her disabilities (including protection from threats to health and safety due to severe cognitive impairment). d) Cannot Be Reimbursed or Reimbursable From Another Source. Medical Care Expenses may be reimbursed from the Participant's HRA Account only to the extent that the Participant or other individual incurring the expense is not reimbursed for the expense (nor is the expense reimbursable) through any other health plan, other insurance, or any other accident or health plan. If only a portion of a Medical Care Expense has been reimbursed elsewhere, the HRA Account may reimburse the remaining portion of such expense if it otherwise meets the requirements of this Article V. 5.6 Maximum Benefits. No reimbursement will be made to the extent that such reimbursement would exceed the Participant's HRA Account balance. 5.7 Establishment of Account. The Plan Administrator will establish and maintain an HRA Account for each Participant. The "HRA Account" so established will be a separate recordkeeping account which will be credited with any Employer Contributions and any attributable investment income and gains, and debited with any allocable expenses, investment losses and reimbursements. 5.8 Carryover and Forfeitures. If any balance remains in the Participant's HRA Account at the end of a Plan Year after all reimbursements have been made for the Plan Year, the unused balance will be carried over to reimburse the Participant for Medical Care Expenses incurred during a subsequent Plan Year. However, any balance that remains in an individual's HRA Account after he or she has ceased to be a Participant under Section 3.4 (e.g., because the individual has died without any surviving spouse or Dependents) and after all reimbursements have been made for any Medical Care expenses incurred before then will be forfeited. In addition, any benefit payments that are unclaimed (e.g., uncashed benefit checks) by the close of the Plan Year following the Plan Year in which the Medical Care Expense was incurred will be forfeited. 5.9 Reimbursement Procedure a) Timing. Within 30 days after receipt by the Plan Administrator of a reimbursement claim from a Participant, the Employer will reimburse the Participant for the Participant's Medical Care Expenses (if the Plan Administrator approves the claim), or the Plan Administrator will notify the Participant that his or her claim has been denied (see Article VII regarding procedures for claim denials and appeals procedures). The 30-day time period may be extended for an additional 15 days for matters beyond the control of the Plan Administrator, including in cases where a reimbursement claim is incomplete. The Plan Administrator will provide written notice of any extension, including the reasons for the extension, and will allow the Participant 45 days in which to complete an incomplete reimbursement claim. 6 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 146 of 549 Page 129 of 138 b) Claims Substantiation. A Participant who seeks benefits may apply for reimbursement by submitting an application in writing to the Plan Administrator in such form as the Plan Administrator may prescribe, within two years of the date the Medical Care Expense was incurred, setting forth: (i) the individual on whose behalf Medical Care Expenses have been incurred; (ii) the nature and date of the Medical Care Expenses so incurred; (iii) the amount of the requested reimbursement; and (iv) a statement that such Medical Care Expenses have not otherwise been reimbursed and are not reimbursable through any other source. The application shall be accompanied by bills, invoices, or other statements from an independent third party (e.g., a hospital, physician, or pharmacy) showing that the Medical Care Expenses have been incurred and the amounts of such Medical Care Expenses, together with any additional documentation that the Plan Administrator may request. C) Claims Denied. For reimbursement claims that are wholly or partially denied, see the appeals procedure in Article VI. 5.10 Reimbursements After Termination of Participation. When a Participant ceases to be a Participant under Section 3.4, the Participant will not be eligible to receive reimbursements for Medical Care Expenses incurred after his or her participation terminates. However, such Participant (or the Participant's estate) may claim reimbursement for any Medical Care Expenses incurred during the Period of Coverage prior to termination of participation, provided that the Participant (or the Participant's estate) files a claim within two years of the date the Medical Care Expense was incurred. ARTICLE VI APPEALS PROCEDURE 6.1 Notice of Denied Claims. If a claim for reimbursement under this Plan is wholly or partially denied, the Plan Administrator or its designee will issue a notice of claim denial to the claimant setting forth: a) the reason(s) for the denial and the Plan provisions on which the denial is based; b) a description of any additional information necessary for the claimant to perfect his or her claim, why the information is necessary, and the time limit for submitting the information; and C) a description of the claimant's right to request the documentation relevant to his or her claim. 6.2 Appeals of Denied Claims. If a claim for benefits is denied under Section 6.1, the claimant or his or her duly authorized representative may, at the claimant's sole expense, 7 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 147 of 549 Page 130 of 138 appeal the denial by submitting written notice of such appeal to the Plan Administrator within 180 days of the receipt of written notice of the denial. The Plan Administrator will notify the claimant of the decision on the appeal within 60 days of receipt of the appeal. The notice of decision on the appeal must be made in writing. If the decision on the appeal is not furnished within the time specified above, the appeal of the claim will be deemed denied. If the claimant's appeal is denied (or deemed denied), the Plan Administrator's decision will be final and binding on all persons. ARTICLE VII PLAN ADMINISTRATION 7.1 Plan Administrator. The administration of this Plan will be under the supervision of the Plan Administrator. It is the principal duty of the Plan Administrator to see that this Plan is carried out, in accordance with its terms, for the exclusive benefit of persons entitled to participate in this Plan. 7.2 Powers of the Plan Administrator. The Plan Administrator will have such duties and powers as it considers necessary or appropriate to discharge its duties. It will have the exclusive right to interpret the Plan and to decide all matters thereunder, and all determinations of the Plan Administrator with respect to any matter hereunder will be conclusive and binding on all persons. Without limiting the generality of the foregoing, the Plan Administrator will have the following discretionary authority: a) to construe and interpret the Plan, including all possible ambiguities, inconsistencies, and omissions in the Plan and related documents, and to decide all questions of fact, questions relating to eligibility and participation, and questions of benefits under the Plan; b) to prescribe procedures to be followed and the forms to be used by Participants and their spouses and Dependents to claim reimbursements under the Plan; C) to prepare and distribute information explaining the Plan and the benefits under it in such manner as the Plan Administrator determines to be appropriate; d) to request and receive from all Participants and their spouses and Dependents such information as the Plan Administrator will from time to time determine to be necessary for the proper administration of the Plan; e) to furnish each Participant and his or her spouse and Dependents with such reports with respect to the administration of this Plan as the Plan Administrator determines to be reasonable and appropriate; f) to receive, review, and keep on file such reports and information regarding the benefits covered by the Plan as the Plan Administrator determines from time to time to be necessary and proper; g) to appoint and employ such individuals or entities to assist in the administration of the Plan as it determines to be necessary or advisable, including legal counsel and benefit consultants; 8 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 148 of 549 Page 131 of 138 h) to sign documents for the purposes of administering the Plan, or to designate an individual or individuals to sign documents for the purposes of administering the Plan; i) to secure or require such evidence as it deems necessary to decide any claim for benefits under the Plan; and j) to maintain the books of accounts, records, and other data in the manner necessary for proper administration of the Plan and to meet any applicable disclosure and reporting requirements. 7.3 Fiduciary Duties. Each Plan fiduciary shall discharge its duties solely in the interest of Participants and their spouses and Dependents and for the exclusive purpose of providing benefits under the Plan, or defraying reasonable expenses of administering the Plan. Each Plan fiduciary, in carrying out such duties and responsibilities, shall act with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use. A fiduciary may serve in more than one fiduciary capacity and may employ one or more persons to render advice with regard to its fiduciary responsibilities. If the fiduciary is serving as such without compensation, all expenses reasonably incurred by such fiduciary will be paid by the Employer. The Employer may, however, elect to have those expenses paid from Trust assets. 7.4 Provision for Third-Party Plan Service Providers. The Plan Administrator, subject to approval of the Employer, may employ the services of such persons as it may deem necessary or desirable in connection with the operation of the Plan. Unless otherwise provided in the service agreement, obligations under this Plan shall remain the obligation of the Employer or Plan Administrator, as applicable. 7.5 Inability to Locate Payee. If the Plan Administrator is unable to make payment to any person to whom a payment is due under the Plan because it cannot ascertain the identity or whereabouts of such person after reasonable efforts have been made to identify or locate such person, then such payment and all subsequent payments otherwise due to such person will be forfeited by the close of the Plan Year following the Plan Year in which the Medical Care Expense was incurred . 7.6 COBRA and HIPAA Compliance. The Plan will comply with the applicable requirements of COBRA, and with the applicable requirements of HIPAA in accordance with the rules set out in Appendix A. ARTICLE VIII AMENDMENT AND TERMINATION OF THE PLAN 8.1 Compliance with Labor Laws. All amendments to or any person's benefits under the Plan or termination of the Plan will conform with any applicable requirements of the Meyers- Milias-Brown Act, including but not limited to any meet-and-confer requirements. 8.2 No Vested Rights. The Employer may at any time amend or terminate the Plan as provided in Sections 8.3 and 8.4. Nothing in the Plan is intended to or will be construed to give any Participant or other person to a vested right to continuance of the Plan or to continue receiving Employer Contributions. 9 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 149 of 549 Page 132 of 138 8.3 Amendment of the Plan. The Employer may amend all or any part of this Plan at any time for any reason by resolution of the Board of Directors or by any person or persons authorized by the Board of Directors to take such action. Any such amendment will supersede and override any claim to "vested rights" that any person may otherwise have with respect to benefits under the Plan. 8.4 Termination of the Plan. a) The Employer has established the Plan with the expectation that it will be continued, but continuance is not a contractual or other obligation of the Employer and no employee of the Employer or other person will have any vested right to continuance of the Plan or to continuance of any Employer contributions to the Plan. The Employer reserves the right at any time to terminate the Plan without prejudice and for any reason, and such termination will supersede and override any claim to "vested rights" that any person may otherwise have with respect to benefits under the Plan. Such decision to terminate the Plan will be made in writing and must be approved by the Board of Directors. b) If the Plan is terminated, the Employer shall direct the trustee to compute the value of the Plan assets under the Trust as of the date of termination. Those assets will continue to be held in the Trust, and will be distributed to pay any remaining benefits owed under the Plan until those benefits are satisfied. C) The "partial termination" rules of the Code that apply to qualified retirement plans will not apply under this Plan, and no action will be taken with respect to this Plan in connection with any event or events that would be a partial termination for a qualified plan. 8.5 Determination of Effective Date of Amendment or Termination. Any such amendment, discontinuance or termination will be effective as of the date the Employer determines. 8.6 Assets After Termination. Any assets remaining in the Trust after all benefits owed under the Plan and all Plan expenses have been paid will revert to the Employer unless otherwise determined by the Employer. 8.7 Limitation of Obligations. The Employer must continue to provide reimbursements for eligible expenses incurred by Participants or their spouses and Dependents under the Plan until the Participant's account balance has been exhausted, but all contributions to the Plan will cease upon Plan termination. No one will accrue any additional contributions under the Plan after its termination. ARTICLE IX GENERAL PROVISIONS 9.1 Governing Law. The provisions of the Plan will be construed, administered and enforced according to applicable federal law and, to the extent not preempted, the laws of the State of California. 9.2 Requirement for Proper Forms. All communications in connection with the Plan made by a Participant or his or her spouse or Dependent will become effective only when duly 10 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 150 of 549 Page 133 of 138 executed on any forms as may be required and furnished by, and filed with, the Employer or Plan Administrator, as applicable. 9.3 No Guarantee of Tax Consequences. This Plan is intended to permit Participants or their spouses or Dependents to obtain reimbursement benefits under this Plan on a nontaxable basis, and the Plan will be interpreted and administered consistent with that intent. Neither the Employer nor any Plan Administrator, however, makes any warranty or other representation as to whether any benefits under the Plan will be treated as excludable from gross income for federal, state, or local income tax purposes. If for any reason it is determined that any amount paid for the benefit of a Participant or his or her spouse or Dependent is includable in gross income for federal, state or local income tax purposes, then under no circumstances will the recipient have any recourse against the Employer or Plan Administrator with respect to any increased taxes or other losses or damages suffered by the recipient as a result thereof. To the extent required by the Code, the Employer will follow the tax withholding and reporting requirements applicable to benefits paid under this Plan to or for a non-dependent domestic partner. 9.4 Compliance With Code and Other Applicable Laws. It is intended that the Plan meet all applicable requirements of the Code and all regulations and guidance issued thereunder. The Plan will be construed, operated and administered accordingly, and in the event of any conflict between any part, clause, or provision of the Plan and the Code, the provisions of the Code will be deemed controlling, and any conflicting part, clause, or provision of the Plan will be deemed superseded to the extent of the conflict. In addition, the Plan will comply with the requirements of all other applicable laws. 9.5 Headings. The headings of the various articles and sections are inserted for convenience of reference and are not to be regarded as part of the Plan or as indicating or controlling the meaning or construction of any provision. 9.6 Severability. Should any part of the Plan subsequently be invalidated by a court of competent jurisdiction, the remainder of the Plan will be given effect to the maximum extent possible. 9.7 Administration Expenses. The Employer will pay the reasonable expenses of administering the Plan, including but not limited to the reasonable compensation of any counsel, accountants, and other agents hired by the Employer, Plan Administrator, or Board of Directors, as well as any other expenses incurred in administering the Plan. The Employer may, however, elect to have those expenses paid from Trust assets. 9.8 Effect of Mistake. In the event of a mistake as to the eligibility or participation of an individual, or the allocations made with respect to any Participant, or the amount of distributions made or to be made to a Participant or other person, the Employer or Plan Administrator will, to the extent it deems possible, cause to be allocated or cause to be withheld or accelerated, or otherwise make adjustment of, such amounts as will in its judgment accord to such Participant or other person that to which he or she is properly entitled under the Plan. 9.9 No Contract of Employment. The Plan does not provide any person with any right to be retained in the Employer's employment or service. A Participant's sole rights under the Plan are limited to those described in this document. 11 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 151 of 549 Page 134 of 138 9.10 Plan Provisions Controlling. The Plan encompasses the benefits provided by the Employer to Participants. In the event that the terms or provisions of any summary or description of the Plan are interpreted as being in conflict with the provisions of the Plan as set forth in this document, the provisions of the Plan will be controlling. 9.11 Non-Assignability of Rights. The right of any Participant or spouse or Dependent to receive any reimbursement under this Plan will not be alienable by the Participant or spouse or Dependent by assignment or any other method and will not be subject to claims by his or her creditors by any process whatsoever. Any attempt to cause such right to be so subjected will not be recognized, except to the extent required by law. 9.12 Compliance with Other Federal Laws. Notwithstanding any Plan provision to the contrary, contributions, benefits, and service credit with respect to qualified military service and FMLA leaves of absence will be provided as required by USERRA or the FMLA, as applicable. To record the adoption of the Plan, the Employer's authorized representative hereby executes this document on this day of 2019. Central Contra Costa Sanitary District By: Title: 12 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 152 of 549 Page 135 of 138 APPENDIX A: HIPAA COMPLIANCE A.1 Provision of Protected Health Information to Employer Members of the Employer's workforce have access to the individually identifiable health information of Plan participants for administrative functions of the Plan. When this health information is provided from the Plan to the Employer, it is Protected Health Information (PHI). The Health Insurance Portability and Accountability Act of 1996 (HIPAA) and its implementing regulations restrict the Employer's ability to use and disclose PHI. The following HIPAA definition of PHI applies for purposes of this Appendix A: Protected Health Information. Protected health information means information that is created or received by the Plan and relates to the past, present, or future physical or mental health or condition of a participant; the provision of health care to a participant; or the past, present, or future payment for the provision of health care to a participant; and that identifies the participant or for which there is a reasonable basis to believe the information can be used to identify the participant. Protected health information includes information of persons living or deceased. The Employer will have access to PHI from the Plan only as permitted under this Appendix A or as otherwise required or permitted by HIPAA. HIPAA and its implementing regulations were modified by the Health Information Technology for Economic and Clinical Health Act (HITECH Act), the statutory provisions of which are incorporated herein by reference. A.2 Permitted Disclosure of Enrollment/Disenrollment Information The Plan may disclose to the Employer information on whether the individual is participating in the Plan. A.3 Permitted Uses and Disclosure of Summary Health Information The Plan may disclose Summary Health Information to the Employer, provided that the Employer requests the Summary Health Information for the purpose of modifying, amending, or terminating the Plan. "Summary Health Information" means information (a) that summarizes the claims history, claims expenses, or type of claims experienced by individuals for whom a plan sponsor had provided health benefits under a health plan; and (b)from which the information described at 42 CFR Section 164.514(b)(2)(i) has been deleted, except that the geographic information described in 42 CFR Section 164.514(b)(2)(i)(B) need only be aggregated to the level of a five-digit ZIP code. A.4 Permitted and Required Uses and Disclosure of PHI for Plan Administration Purposes Unless otherwise permitted by law, and subject to the conditions of disclosure described in Section A.5 and obtaining written certification pursuant to Section A.7, the Plan may disclose PHI to the Employer, provided that the Employer uses or discloses such PHI only for Plan administration purposes. "Plan administration purposes" means administration functions performed by the Employer on behalf of the Plan, such as quality assurance, claims processing, auditing, and monitoring. Plan administration functions do not include functions performed by A-1 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 153 of 549 Page 136 of 138 the Employer in connection with any other benefit or benefit plan of the Employer, and they do not include any employment-related functions. Notwithstanding the provisions of this Plan to the contrary, in no event will the Employer be permitted to use or disclose PHI in a manner that is inconsistent with 45 CFR Section 164.504(f). A.5 Conditions of Disclosure for Plan Administration Purposes The Employer agrees that with respect to any PHI (other than enrollment/disenrollment information and Summary Health Information, which are not subject to these restrictions) disclosed to it by the Plan, the Employer will: • not use or further disclose the PHI other than as permitted or required by the Plan or as required by law; • ensure that any agent, including a subcontractor, to whom it provides PHI received from the Plan agrees to the same restrictions and conditions that apply to the Employer with respect to PHI; • not use or disclose the PHI for employment-related actions and decisions or in connection with any other benefit or employee benefit plan of the Employer; • report to the Plan any use or disclosure of the information that is inconsistent with the uses or disclosures provided for of which it becomes aware; • make available PHI to comply with HIPAA's right to access in accordance with 45 CFR Section 164.524; • make available PHI for amendment and incorporate any amendments to PHI in accordance with 45 CFR Section 164.526; • make available the information required to provide an accounting of disclosures in accordance with 45 CFR Section 164.528; • make its internal practices, books, and records relating to the use and disclosure of PHI received from the Plan available to the Secretary of Health and Human Services for purposes of determining compliance by the Plan with HIPAA's privacy requirements; • if feasible, return or destroy all PHI received from the Plan that the Employer still maintains in any form and retain no copies of such information when no longer needed for the purpose for which disclosure was made, except that, if such return or destruction is not feasible, limit further uses and disclosures to those purposes that make the return or destruction of the information infeasible; and • ensure that the adequate separation between the Plan and the Employer (i.e., the "firewall"), required in 45 CFR Section 504(f)(2)(iii) is satisfied. The Employer further agrees that if it creates, receives, maintains, or transmits any electronic PHI (other than enrollment/disenrollment information and Summary Health Information, which A-2 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 154 of 549 Page 137 of 138 are not subject to these restrictions) on behalf of the Plan, it will implement administrative, physical, and technical safeguards that reasonably and appropriately protect the confidentiality, integrity, and availability of the electronic PHI, and it will ensure that any agents (including subcontractors) to whom it provides such electronic PHI agree to implement reasonable and appropriate security measures to protect the information. The Employer will report to the Plan any security incident of which it becomes aware. A.6 Adequate Separation Between Plan and Employer The Employer will allow the following persons access to PHI: the Human Resources Manager, the Plan Administrator, and any other Employee who needs access to PHI in order to perform Plan administration functions that the Employer performs for the Plan (such as quality assurance, claims processing, auditing, and monitoring). No other persons will have access to PHI. These specified employees (or classes of employees) will only have access to and use PHI to the extent necessary to perform the plan administration functions that the Employer performs for the Plan. In the event that any of these specified employees does not comply with the provisions of this section, that employee will be subject to disciplinary action by the Employer for non-compliance pursuant to the Employer's employee discipline and termination procedures. The Employer will ensure that the provisions of this Section A.6 are supported by reasonable and appropriate security measures to the extent that the designees have access to electronic PHI. A.7 Certification of Plan Sponsor The Plan will disclose PHI to the Employer only upon the receipt of a certification by the Employer that the Plan incorporates the provisions of 45 CFR Section 164.504(f)(2)(ii), and that the Employer agrees to the conditions of disclosure set forth in Section B.S. Execution of the Plan by the Employer will serve as the required certification. A.8 Privacy Official The Employer will designate a Privacy Official, who will be responsible for the Plan's compliance with HIPAA. The Privacy Official may contract with or otherwise utilize the services of attorneys, accountants, brokers, consultants, or other third party experts as the Privacy Official deems necessary or advisable. In addition and notwithstanding any provision of this Plan to the contrary, the Privacy Official will have the authority to and be responsible for: • accepting and verifying the accuracy and completeness of any certification provided by the Employer under this Appendix; • transmitting the certification to any third parties as may be necessary to permit them to disclose PHI to the Employer; • establishing and implementing policies and procedures with respect to PHI that are designed to ensure compliance by the Plan with the requirements of HIPAA; • establishing and overseeing proper training of personnel who will have access to PHI; and A-3 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 155 of 549 Page 138 of 138 • any other duty or responsibility that the Privacy Official, in his or her sole capacity, deems necessary or appropriate to comply with the provisions of HIPAA and the purposes of this Appendix A. A.9 Interpretation and Limited Applicability This Appendix serves the sole purpose of complying with the requirements of HIPAA and will be interpreted and construed in a manner to effectuate this purpose. Neither this Appendix nor the duties, powers, responsibilities, and obligations listed herein will be taken into account in determining the amount or nature of the benefits provided to any person covered under the Plan, nor will they inure to the benefit of any third parties. To the extent that any of the provisions of this Appendix A are no longer required by HIPAA or do not apply to the Plan because the Plan is otherwise excepted from HIPAA, they will be deemed deleted and will have no force or effect. A.10 Service Performed for the Employer Notwithstanding any other provisions of this Plan to the contrary, all services performed by a business associate for the Plan in accordance with the applicable service agreement will be deemed to be performed on behalf of the Plan and subject to the administrative simplification provisions of HIPAA contained in 45 CFR Parts 160 through 164, except services that relate to eligibility and enrollment in the Plan. If a business associate of the Plan performs any services that relate to eligibility and enrollment in the Plan, these services will be deemed to be performed on behalf of the Employer in its capacity as Plan Sponsor and not on behalf of the Plan. A-4 15103925.3 May 16, 2019 Regular Board Meeting Agenda Packet- Page 156 of 549