BACKGROUND

The Board of Trustees conditionally approved adopting Exhibit B to the IUOE National Reciprocity Agreement (Money Follows the Man Reciprocity) at their 124th Regular Meeting. The approval was conditioned upon Staff developing appropriate administrative policies and procedures, including a revised authorization form, which would address various legal issues identified by Fund Counsel. In addition, the Trustees approved Staff's recommendation that money follows the man reciprocity be administered in accordance with relevant prior interpretative rulings issued by the General Secretary/Treasurer's office of the IUOE. This document is intended to set forth the initial policies and procedures with respect to issues identified to date. The policies and procedures will be subject to further revision, based upon actual experience. Based upon a number of such interpretations, the following policies will be initially adopted by the Central Pension Fund in administering money follows the man reciprocity.

POLICIES INVOLVING CHANGES IN LOCAL UNION MEMBERSHIP

1.   If a participant acquires a vested interest in their accrued benefit with the Central Pension Fund, subsequently transfers their Local Union membership to a non-CPF Local Union, and then requests a transfer of contributions to his current Home Local Pension Fund, the Central Pension Fund will only transfer contributions prospectively. Such contributions will not be subject to transfer under the money follows the man provisions of the National Reciprocity Agreement and the Participant will remain vested in the Central Pension Fund. The pension plan sponsored by the participant's new home Local Union would become his Home Local Pension Fund for purposes of future contributions only, while the participant remains a member of the new Local Union.

2.   If a non-vested participant changes his home Local Union membership and subsequently requests a transfer of contributions to his new Home Local Pension Fund, the Central Pension Fund will only honor that request with respect to contributions received, if the current Home Local Pension Fund was also the Participant's Home Local Pension Fund at the time the work was performed, which gave rise to the contributions seeking to be transferred. For example, assume a participant has an Initial Participation Date with the Central Pension Fund of January 1, 1990 and is subsequently reported to the Central Pension Fund for four consecutive years. Further assume that during January 1995 the participant transfers his membership from Local Union No. 406 to a Local Union which maintains an independent pension fund, such as IUOE Local No. 302. The participant then files a transfer authorization request, pursuant to the money follows the man reciprocity provisions, seeking a transfer of all contributions received by the Central Pension Fund to his current Home Local Pension Fund, IUOE Local No. 302 Pension Fund. The Central Pension Fund will only recognize that transfer authorization with respect to contributions received for hours of service on or after January 1, 1995. Contributions received by the Central Pension Fund for period endings prior to January 1, 1995 would remain with the Central Pension Fund and are not subject to transfer.

3.   If a participant incurs a permanent break-in-service under the terms of the Central Pension Fund's Plan of Benefits, after taking into consideration all related service with all related funds, his service will not be revived or restored if he has subsequent service in another fund. For example, assume a participant earns two years of credited service with the Midwest Operating Engineers Pension Fund and then earns two years of credited service with the Central Pension Fund. Further assume the participant leaves the industry and at age 65, incurs a permanent break-in-service under the provisions of the CPF Plan of Benefits. If the participant resumes covered employment in his Home Local Pension Fund, after incurring the permanent break-in-service with the Central Pension Fund, and the Home Local Pension Fund restores his service under their rules, the Central Pension Fund is not obligated to follow suit.

FORMS FOR REQUESTING TRANSFERS

Attached is a revised authorization form prepared by Fund Counsel, which must be completed by a participant before processing any reciprocity transfer requests received. Additional forms may be designed, as needed, based upon subsequent experience.

TIME LIMITS APPLICABLE TO TRANSFERS