To Freeze, or Not To Freeze Governmental MP Plan

[buckyks]

I have a governmental employer that cannot meet minimum funding standards for their MP plan in the foreseeable future. The question is, can they freeze their plan until such time as they are financially stable, and then unfreeze the plan with the intent of remaining solvent to the point that they will not have a problem meeting minimum funding, or would they be better off by simply adopting a PS plan, and merging the two.

If they freeze the current plan, does anyone know of any authority rregarding unfreezing the plan in the future?

[Everett Moreland]

To answer a question you did not ask, courts in some states have ruled that government employees have a vested contract right to continue the present terms of their employer's retirement plan for the rest of their future service. If the employer is in one of those states, this issue needs to be addressed before the plan is amended to cease contributions.

[buckyks]

Thanks for the thought, however, this is a county healthcare facility, and not a part of the State benefits program. They operate independently of the county. Rather, they receive county funding from the tax roles, and operate under a county appointed Board.