TAX SHELTERED ANNUITY PROGRAM

1. Each employee eligible for membership in State Teachers' Retirement System or Public Employees Retirement System of the Redwoods Community College District shall be given the opportunity of entering into an amendment to such employee's contract of employment for the purpose of effecting a reduction in the salary paid to such employee.

2. For each employee who voluntarily elects to accept such reduction in the salary paid, Redwoods Community College District will, as directed by such employee, purchase with an amount equal to such reduction in salary, a non-transferable annuity contract issued by a mutual fund company or a life insurance company in which the employee's rights are nonforfeitable except for failure to pay future premiums.

3. Any employment arrangement between the Board of Trustees and an employee may be modified to substitute the payment of annuity premiums by the Board of Trustees in lieu of a like portion of the compensation payable directly to the employee, and to provide that the Board of Trustees expend such amount as requested in writing by said employee for the purchase of a monthly annuity for such employee through any of the approved companies after execution by the company of an indemnity
agreement.

4. All rights in such annuity contract vest in the employee immediately upon purchase; and like amounts will be similarly expended in each year of the continued employment of each such employee, so long as such agreement remains effective, and unless contrary action is ordered by this Board of Trustees; and

5. For each employee who voluntarily elects to accept such reduction in the salary paid, the Redwoods Community College District will pay to the State Teachers' Retirement System of California or Public Employees' Retirement System the amount necessary for the retirement contributions within the meaning of the provisions of Section 13814.1 of the California Education Code, prior to reorganization of the Education Code.

6. The Board hereby authorizes the Superintendent of the Redwoods Community College District to act in its behalf in respect to the purchase and administration of these Annuity Contracts.

Internal Revenue Code Section 403(b), Public Law 87-37D and California Revenue and Taxation Code Section 17152.

Education Code 22810-22812



Adopted by Board of Trustees: August 15, 1977
Revised: August 2, 1982; August 5, 1985