§ 5.41.050. Dependent care expense reimbursement benefit.

A.

Reimbursement of Qualifying Dependent Care. Subject to the terms and limits set forth in this Section 5.41.050, Covered Employees may be reimbursed for Qualifying Dependent Care Expenses as defined in Section 5.41.050B.

B.

Qualifying Dependent Care Expenses Defined. Qualifying Dependent Care Expenses means expenses incurred by the Covered Employee for household services or for the care of a Qualifying Dependent but only if such expenses are incurred to enable the Covered Employee (and the Covered Employee's spouse, if any) to be gainfully employed or to search for gainful employment for any period for which there are one or more Qualifying Dependents with respect to the Covered Employee, and subject to the exclusions set forth in Section 5.41.050C. For these purposes:

1.

A Covered Employee's spouse is deemed gainfully employed for each month that he is a Full-Time Student or is Incapable of Self-Care.

2.

Volunteer work for a nominal salary does not constitute gainful employment.

3.

Expenses paid for a period during only part of which a Covered Employee or spouse is gainfully employed or in active search of gainful employment must be allocated on a daily basis, unless such expenses are incurred during a short, temporary absence from work (such as for vacation or minor illness) and the dependent care arrangement requires payment for care during the absence. An absence of two consecutive calendar weeks is deemed a short, temporary absence.

4.

Expenses are for the care of a Qualifying Dependent only if their primary purpose is to assure the individual's well-being and protection. Expenses incurred for the care of a Qualifying Dependent may include employment taxes on the wages of a care provider, the additional costs of room and board for a care provider over usual household expenditures, and expenses that relate to, but are not directly for, the care of a Qualifying Dependent such as application fees, agency fees and deposits if the Covered Employee is required to pay those expenses to obtain the related care. Forfeited deposits or other payments are not for the care of a Qualifying Dependent if care is not provided in connection with those amounts.

5.

Expenses are paid for household services if they are paid for the performance in and about the Covered Employee's home of ordinary and usual services necessary to the maintenance of the household, provided the expenses are attributable to the care of a Qualifying Dependent. Services of a housekeeper are household services if the services are provided, at least in part, to the Qualifying Dependent.

6.

Expenses that are incurred for services outside the Covered Employee's household may qualify as Qualifying Dependent Care Expenses only if such expenses are incurred for the care of a Qualifying Dependent described in subsection 5.41.020AA1 of this Plan or any other Qualifying Dependent who regularly spends at least 8 hours each day in the Covered Employee's household.

7.

Expenses that are incurred for services provided outside the Covered Employee's household by a Dependent Care Center may qualify as Qualifying Dependent Care Expenses only if such center complies with all applicable state and local laws and regulations applicable to such facility.

8.

The cost of transportation by a care provider of a Qualifying Dependent to or from a place where care of the Qualifying Dependent is provided may be for the care of the Qualifying Dependent.

9.

Qualifying Dependent Care Expenses are incurred on the date the dependent care is provided, not on the date charged, billed, or paid.

C.

Exclusions. Notwithstanding any other provision of this Plan to the contrary, Qualifying Dependent Care Expenses do NOT include:

1.

Any amounts paid for services outside the Covered Employee's household at a camp where the Qualifying Dependent stays overnight.

2.

Expenses incurred in connection with services rendered by: (a) a Covered Employee's child or a child of the Covered Employee's spouse who is under the age of 19 as of the end of the Plan Year, or (b) a person who qualifies as a dependent of the Covered Employee or a dependent of the Covered Employee's spouse and for whom a deduction is allowable under Code Section 151(c) to the Covered Employee or to the Covered Employee's spouse for the Plan Year.

3.

The costs of a Qualifying Dependent's food, clothing, entertainment, or education (unless for a child below kindergarten) unless those costs are incidental, minimal, and inseparable from the cost of caring for a Qualifying Dependent.

4.

The costs of transportation other than as provided in subsection 5.41.050B.8.

D.

Coverage Period Limitations. Qualifying Dependent Care Expenses reimbursed by the Plan for a Plan Year must have been incurred during the Coverage Period. Accordingly, with regard to each Plan Year, the Plan will not reimburse any expenses incurred:

1.

before the start of the Plan Year or after the end of the Plan Year,

2.

before a benefit election becomes effective in accordance with Section 5.41.030, or

3.

after coverage terminates or during a period in which coverage is suspended in accordance with Section 5.41.030.

E.

Amount Payable. Reimbursement of Qualifying Dependent Care Expenses may not exceed the Annual Contribution Credits elected for the Plan Year, or the balance credited to a Covered Employee's Dependent Care Account at the time such reimbursement is made. Any unused balance in a Covered Employee's Dependent Care Account after the claims period described in Section 5.41.060C has expired shall be forfeited.

F.

Code Limitations on Benefits. Benefits payable under the Plan to each highly compensated Employee, as defined in Code Section 414(q), are limited to the extent necessary to avoid violating the nondiscrimination requirements contained in Code Section 129.

(Ord. 2008-0014 § 20 (part), 2008.)