Using distribution payments as contributions.

[Lori H]

A state govt entity makes periodic contributions to its plan (no-coda). Distributions are paid in house and the plan reimburses the corporation. The corp then reduces its contribution by that amount, so for example if they were due to make a $20,000 contribution, but paid $5000 in distributions, they only would deposit $15,000. Is this allowed? They are pooled accounts.