HomeMy WebLinkAbout4417 Police Officers Retirement SystemOrdinance No. 4417
An Ordinance of the City of Sanford, Florida, amending Chapter 66,
pensions and retirement, Article 11 of the Code of Ordinances of the City
of Sanford relating to the Police Officers' Retirement System; amending
Section 66-32, Section 66-36, Section 66-36, Section 66-36 and Section
66-39, and adding Section 66-47 relating to supplemental benefit
component for special benefits/Chapter 185 share accounts; providing
for legislative findings and intent; providing for conflicts; providing for
a savings provision; providing for codification; providing for
severability and providing for an effective date.
Be it Enacted by the People of the City of Sanford, Florida:
Section 1. Legislative findings and intent.
(a). The City Commission of the City of Sanford hereby adopts and incorporates
into this Ordinance the City staff report and City Commission agenda memorandum
relating to this Ordinance.
(b). The City of Sanford has complied with all requirements and procedures of
Florida law in processing and advertising this Ordinance.
Section 2. Police Officers' Retirement System. Chapter 66, Article 11, Code of
Ordinances of the City of Sanford, is hereby amended by amending Section 66-32,
Membership, Subsection (1), to read as follows:
(1) Conditions of eligibility.
(a) All police officers employed by the City as of April 27,1998, and all future new police
officers, shall become members of this system as a condition of employment.
IRTMZHFIWKW�—�Uwj . . 11 &
MCIMMANWITAIMUTTYM". Zd. W.M."3ETZ
For the purposes of this Ordinance, underlined type shall constitute additions to the original text, * * * shall
constitute ellipses to the original text and strikethr-ough shall constitute deletions to the original text.
I
eligible fbF any GtheF beRefits fFern the plan. Notwithstanding the preceding sentence, this
system shall be closed to new members on October 1, 2017. Police officers hired on or
after October 1, 2017 shall become compulsory members of the Florida Retirement
System (FIRS) and shall not be eligible for membership in this system. Police officers hired
before October 1. 2017 who are members of this system on September 30, 2017 may elect
to participate in FRS or continue participating in this system. Eligibility for participation in
the FRS, as well as FRS benefits and contributions, will be determined in accordance with
Chapter 121. Florida Statutes, as that statute now exists and as it may be amended in the
M.
al -
For the purposes of this Ordinance, underlined type shall constitute additions to the original text, * * * shall
constitute ellipses to the original text and stFikethmugh shall constitute deletions to the original text.
Section 3. Police Officers' Retirement System. Chapter 66, Article 11, Code of
Ordinances of the City of Sanford, is hereby amended by amending Section 66-35,
Contributions, Subsection (1) (a), Amount, to read as follows:
(a) Amount Effective October 1, 2017, each member of the system shall be required to
make regular contributions to the fund in the amount of five and one- teRth six and one-
tenth percent of his or her gross pay. Member contributions withheld by the City on behalf
of the member shall be deposited with the Board immediately after each pay period. The
contributions made by each member to the fund shall be designated as employer
contributions pursuant to Section 414(h) of the Code. Such designation is contingent upon
the contributions being excluded from the members' gross income for Federal Income Tax
purposes. For all other purposes of the system, such contributions shall be considered to
be member contributions.
Section 4. Police Officers' Retirement System. Chapter 66, Article 11, Code of
Ordinances of the City of Sanford, is hereby amended by amending Section 66-36, Benefit
Amounts and Eligibility, subsection (a), Normal Retirement, Subsection (a)(2), Normal
Retirement Benefit, to read as follows:
(a)(2) Normal retirement benefit. A member retiring hereunder on or after his or her
normal retirement date shall receive a monthly benefit which shall commence on the first
day of the month coincident with or next following his retirement date and be continued
thereafter during member's lifetime, ceasing upon death, but with 120 monthly payments
guaranteed in any event. The monthly retirement benefit shall equal three and
For the purposes of this Ordinance, underlined type shall constitute additions to the original text, * * * shall
constitute ellipses to the original text and stFikethr-ough shall constitute deletions to the original text.
3
fifty -hundredths percent of average final compensation, for each year of credited service
prior to October 1, 2017 and three percent of average final compensation, for each year of
credited service after October 1, 2017.
Section 5. Police Officers' Retirement System. Chapter 66, Article 11, Code of
Ordinances of the City of Sanford, is hereby amended by amending Section 66-36, Benefit
Amounts and Eligibility, subsection (d), Disability, subsection (d)(1), Disability Benefits On -
Duty, and subsection (d)(3), Disability Benefits Off -Duty, to read as follows:
(d)(1) Disability benefits on -duty. Any member who shall become totally and permanently
disabled to the extent that he or she is unable, by reason of a medically determinable
physical or mental impairment, to render useful and efficient service as a police officer,
which disability was directly caused by the performance of his duty as a police officer, shall,
upon establishing the same to the satisfaction of the board, be entitled to a monthly
pension equal to three and fifty -hundredths percent of base pay at the date of disability for
each year of credited service prior to October 1, 2017 and three percent of average final
compensation, for each year of credited service after October 1, 2017, but in any event the
minimum amount to be paid to the member shall be equal to 50 percent of the base pay of
the member at the date of disability. Notwithstanding the previous sentence, in the event a
member is determined by the board to be disabled in-line of duty and the disability resulted
from the perpetration of an intentional act of violence directed toward the police officer and
the board reasonably believes the perpetrator intended to cause great bodily harm or
permanent disfigurement of the police officer, the minimum amount paid to the member
shall be 80 percent of the average final compensation of the member. Terminated persons,
For the purposes of this Ordinance, underlined type shall constitute additions to the original text,*** shall constitute ellipses to the
original text and strikethrough shall c-onstitute deletions to the original text.
4
either vested or non -vested, are not eligible for disability benefits. Notwithstanding the
previous sentence, if a member is terminated by the City for medical reasons, the
terminated person may apply for a disability benefit if the application is filed with the Board
within thirty (30) days from the date of termination. If a timely application is received, it shall
be processed and the terminated person shall be eligible to receive a disability benefit if
the Board otherwise determines that he is totally and permanently disabled as provided for
above.
(d)(3) Disability benefits off-duty. Any member with five years or more credited service
who shall become totally and permanently disabled to the extent that he or she is unable,
by reason of a medically determinable physical or mental impairment, to render useful and
efficient service as a police officer, which disability is not directly caused by the
performance of his or her duties as a police officer shall, upon establishing the same to the
satisfaction of the Board, be entitled to a monthly pension equal to three and fifty
hundredths (3.50) percent of base pay at the date of disability for each year of credited
service prior to October 1, 2017 and three percent of average final compensation, for each
year of credited service after October 1, 2017. Terminated persons, either vested or
non -vested, are not eligible for disability benefits. Notwithstanding the previous sentence, if
a member is terminated by the City for medical reasons, the terminated person may apply
for a disability benefit if the application is filed with the Board within thirty (30) days from the
date of termination. If a timely application is received, it shall be processed and the
For the purposes of this Ordinance, underlined type shall constitute additions to the original text,*** shall constitute ellipses to the
original text and strikethrough shall constitute deletions to the original text.
5
terminated person shall be eligible to receive a disability benefit if the Board otherwise
determines that he or she is totally and permanently disabled as provided for above.
Section 6. Police Officers' Retirement System. Chapter 66, Article II, Code of
Ordinances of the City of Sanford, is hereby amended by amending Section 66-39,
Miscellaneous Provisions, to add Subsection (12) to read as follows:
In -Service Distributions.
The plan may make in-service distributions if otherwise permitted under applicable law.
Section 7. Police Officers' Retirement System. Chapter 66, Article II, Code of
Ordinances of the City of Sanford, is hereby amended by adding Section 66-47,
Supplemental Benefit Component for Special Benefits; Chapter 185 Share Accounts, to
read as follows:
Sec. 66-47. Supplemental Benefit Component for Special Benefits; Chapter 186
Share Accounts.
There is hereby established an additional plan component to provide special
benefits in the form of a supplemental retirement, termination, death and disability benefit
to be in addition to the benefits provided for in the previous Sections of this Plan, such
benefit to be funded solely and entirely by Chapter 185, Florida Statutes, premium tax
monies for each plan year which are allocated to this supplemental component as provided
for in Section 185.35 Florida Statutes. Amounts allocated to this supplemental component
("Share Plan") shall be further allocated to the members and DROP participants in a
manner to be agreed upon.
For the purposes of this Ordinance, underlined type shall constitute additions to the original text, * * * shall constitute ellipses to the
original text and strikethrough shall constitute deletions to the original text.
19
Section 8. Savings. The prior actions of the City of Sanford relating to the
administration of the Police Officers' Retirement System and related matter are hereby
ratified and affirmed.
Section 9. Conflicts. All Ordinances or parts of Ordinances in conflict with this
Ordinance are hereby repealed.
Section 10. Severability. If any section, sentence, phrase, word, or portion of this
ordinance is determined to be invalid, unlawful or unconstitutional, said determination shall
not be held to invalidate or impair the validity, force or effect of any other section, sentence,
phrase, word, or portion of this Ordinance not otherwise determined to be invalid, unlawful,
or unconstitutional.
Section 11. Codification. Sections 2, 3, 4, 5, 6 and 7 of this Ordinance shall
become and be made a part of the Code of Ordinances of the City of Sanford, Florida;
provided,' however, that all other sections shall not be codified.
Section 12. Effective Date. This Ordinance shall become effective
immediately upon enactment by the City Commission.
Passed and Adopted this nth day of September, 2017.
Attest:
Cynthia Porter, City Cleric
Approved s to form and I al sufficiency:
__.
William L. Colbert, Esquire,
City Attorney
City Commission 11of the City of
Sanford, FIq---
For the purposes of this Ordinance, underlined type shall constitute additions to the original text,*** shall constitute ellipses to the
original text and strikethrough shall constitute deletions to the original text.
0
WS RM X
4�
Item No. t
CITY COMMISSION MEMORANDUM 17.265
SEPTEMBER 11, 2017 AGENDA
TO: Honorable Mayor and Members of the City Commission
PREPARED BY: Cynthia Porter, City Clerk
Cynthia M Lindsay, Directo of Finance
SUBMITTED BY: Norton N. Bonaparte, Jr., City Manag
SUBJECT: City of Sanford Police Officers' Retire nt System Proposed Ordinance
STRATEGIC PRIORITIES: f
❑ Unify Downtown & the Waterfront /
❑ Promote the City's Distinct Culture
❑ Update Regulatory Framework
❑ Redevelop and Revitalize Disadvantaged Communities
SYNOPSIS:
Ordinance No. 2017-4417, amending City Code, Sections 66-32, 66-35, 66-36, 66-39 and 66-47 of
the Police Officers' Retirement System, is being submitted for second reading and adoption.
FISCAL/STAFFING STATEMENT:
The Police Pension Board's actuary, Foster & Foster, Inc. advised there is no cost associated with
the adoption of this ordinance.
BACKGROUND:
At the May 4, 2017 Police Officers' Pension Board meeting, the board unanimously recommended
amending the following sections of the Police Officers' Retirement System in accordance with
recent changes to the City's union contracts with employees.
• Section 66-32, Conditions of eligibility, is being amended to close entrance to new members
effective October 1, 2017.
Section 66-35, Contributions, is being amended to recognize the contract negotiations and
raising the employee contribution from five and one-tenth percent to six and one-tenth
percent.
• Section 66-36, Normal retirement benefit, is being amended to recognize the contract
negotiations of changing the percent of average final compensation for retirement payment
purposes from 3.5% to 3% for service credited after October 1, 2017.
• Section 66-36, Disability benefits on -duty and off-duty, is being amended to recognize the
contract negotiations of changing the percent of average final compensation for retirement
payment purposes from 3.5% to 3% for service credited after October 1, 2017.
• Section 66-39, In -Service Distributions, is being amended to allow for in-service
distributions.
• Section 66-47, Benefit; Chapter 185 Share Accounts is being added to abide by F.S. 185.35
establishing a share plan component to the plan. This amendment is not currently being
funded due to the union contract allowing the City to use all Chapter 175 premium tax monies
to pay down the unfunded liability that are in reserves and going forward.
The City Commission approved the first reading of Ordinance 2017-4417 on August 28, 2017.
The City Clerk published notice of the public hearing in the Sanford Herald on August 27, 2017.
LEGAL REVIEW:
The ordinance was prepared by the Police Officers' Pension Board attorney.
RECOMMENDATION:
The Police Officers' Pension Board recommends that the City Commission adopt the ordinance.
SUGGESTED MOTION:
"I move to adopt Ordinance No. 2017-4417."
Attachments: Cover letter from the Law Offices of Christiansen & Definer, P.A.
Actuarial Impact Letter from Foster & Foster Actuaries
Ordinance No. 2017-4417
Law Offices
Christiansen & Delmer, P.A.
63 Sarasota Center Blvd. Suite 107 Sarasota, Florida 34240 + 941.377.2200 * Fax 941-377-4848
May 22, 2017MAY 2 5 2017
';
Mr. Norton N. Bonaparte Jr.
City Manager
City of Sanford
Post Office Box 1788
Sanford, Florida 32772-1788
Re: City of Sanford Police Officers' Retirement System - Proposed Ordinance
Dear Mr. Bonaparte
As you know, I represent the Board of Trustees of the City of Sanford Police Officers'
Retirement System. Enclosed please find a proposed ordinance amending the City of Sanford Police
Officers' Retirement System which is recommended by the Board for adoption by the City
Commission. This ordinance provides language to close the plan to new members as of October 1,
2017, in accordance with a recently negotiated union agreement. We have also included language
to allow in-service distributions, as well as a section to add the Supplemental Benefit Component
which is now required for all police officer plans under Chapter 185, Florida Statutes. There is no
cost associated with this addition.
By copy of this letter to the Board's actuary, Foster & Foster, Inc., I am requesting that they
provide you with the necessary actuarial impact statement that must accompany this ordinance upon
consideration and adoption by the City Commission.
If you or any member of your staff have any questions with regard to this ordinance, please
feel free to give me a call. In addition, if you feel it would be appropriate for me to be present at the
meeting at which this ordinance is considered by the City Commission, please contact my office to
advise me of the date that the ordinance would be considered.
YourZvey,
Scott R. Christiansen
SRC/dm
enclosure
cc: Patrick Donlan, with enclosure
Susy Pita, with enclosure
FOSTER & FOSTER
ACTUARIES AND CONSULTANTS
July 27, 2017
VIA MAIL AND E-MAIL
Ms. Susy Pita, Plan Administrator
21629 Stirling Pass
Leesburg, FL 34748
Re: City of Sanford
Police Officer's Retirement System
Actuarial Impact Statement
Dear Susy:
Enclosed is the following material, which has been prepared in support of the proposed benefit change to
the above referenced Fund:
1. Three (3) copies of the required Actuarial Impact Statement, which outlines the costs associated with
implementing the change.
2. Draft of transmittal letters to the Bureau of Local Retirement Systems and the Bureau of Police
Officers' Retirement Trust Funds.
Signed copies of the Impact Statement and corresponding ordinance should be forwarded to the two
Bureaus.
If you have any questions concerning the enclosed material, please let us know.
Sincerely,
at.
ristine M. O"
'Nea01,F gSAEA, M A A A
Enclosures
Cc (via email): Scott Christiansen, Board Attorney
Cynthia Lindsay, Director of Finance
13420 Parker Commons Blvd., Suite 104 Fort Myers, FL 33912 - (239) 433-5500 - Fax (239) 481-0634 - www.foster-foster.com
Ms. Sarah Carr
Police Officers' and Firefighters' Retirement Trust Funds
Department of Management Services, Division of Retirement
Post Office Box 3010
Tallahassee, FL 32315-3010
Re: Actuarial Impact Statement
Dear Ms. Carr:
The City of Sanford is considering the implementation of amended retirement benefits for its Police
Officers. The changes are described in the enclosed material.
Pursuant to the provisions of Chapter 175, we are enclosing the required Actuarial Impact Statement and a
copy of the proposed Ordinance for your review.
If you have any questions or if additional information is needed, please contact us.
Sincerely,
Mr. Keith Brinkman
Bureau of Local Retirement Systems
Division of Retirement
Post Office Box 9000
Tallahassee, FL 32315-9000
Re: Actuarial Impact Statement
Dear Mr. Brinkman:
The City of Sanford is considering the implementation of amended retirement benefits for its Police
Officers. The changes are described in the enclosed material.
Pursuant to Section 22d-1.04 of the Agency Rules, we are enclosing the required Actuarial Impact
Statement (AIS) and a copy of the proposed Ordinance for your review.
If you have any questions or if additional information is needed, please contact us.
Sincerely,
CITY OF SANFORD
POLICE OFFICERS' RETIREMENT SYSTEM
ACTUARIAL IMPACT STATEMENT
July 27, 2017
Attached hereto is a comparison of the impact on the Total Required Contribution (per Chapter 112, Florida
Statutes), and the Required City Contributions, resulting from the implementation of the following changes:
o The retirement system shall be closed to new Members on October 1, 2017. Police
Officers hired on or after October 1, 2017 shall become compulsory members of the
Florida Retirement System (FRS).
o Police Officers hired before October 1, 2017 who are Members of this system on
September 30, 2017 may elect to participate in FRS or continue participating in this
system.
■ For the purpose of this impact statement, we assumed all Members will stay in this
system. The actual experience will be recognized once the elections are known.
o Effective October 1, 2017 the Member Contribution rate increases from 5.1% to 6.1% of
gross pay.
o The benefit multiplier is 3.0% for each year of Credited Service on and after October 1,
2017 (the rate for prior service remains at 3.5%).
o The plan is allowing in-service distributions if otherwise permitted under applicable law.
o A share plan is established.
In addition to the changes above, mutual consent was reached regarding the use of State Monies. It is our
understanding that the agreement entails the use of the entire $1,623,180.64 Excess State Monies Reserve
to be used to offset the Unfunded Actuarial Accrued Liability (UAAL). The City will continue to be able
to use the $176,349 to offset their annual contribution and the excess will be used to pay down the UAAL.
Since the use of the Excess Reserve was part of a benefit changes, we amortized the resulting base over 30
years.
The Plan closure also required us to lower the payroll growth assumption from 1.93% to 0% as the
anticipated payroll is expected to decrease overtime.
CITY OF SANFORD
POLICE OFFICERS' RETIREMENT SYSTEM
ACTUARIAL IMPACT STATEMENT
July 27, 2017
(Page 2)
The cost impact, determined as of October 1, 2016, as applicable to the plan/fiscal year ended September
30, 2018, is as follows:
Proposed Current
Total Required Contribution
% of Total Annual Payroll
25.9%
30.1%
Less Member Contributions
% of Total Annual Payroll
6.1%
5.1%
Equals Required City & State
% of Total Annual Payroll
19.8%
25.0%
State Contribution*
176,349
176,349
% of Total Annual Payroll
3.1%
3.1%
Balance from City
% of Total Annual Payroll
16.7%
21.9%
* The City may use the State Monies up to $176,349 per year, if received, to offset their required
contribution. Amounts received in excess of this amount are used to pay down the UAAL.
The changes presented herein are in compliance with Part VII, Chapter 112, Florida Statutes and Section
14, Article X of the State Constitution. The undersigned is familiar with the immediate and long-term
aspects of pension valuations, and meets the Qualification Standards of the American Academy of
Actuaries necessary to render the actuarial opinions contained herein. All of the sections of this report and
the October 1, 2016 valuation report are considered an integral part of the actuarial opinions.
(L�, V4,na
Christine M. O'Neal FSA, EA, MAAA
Enrolled Actuary #17-7916
STATEMENT OF PLAN ADMINISTRATOR
The prepared information presented herein reflects the estimated cost of the proposed improvement.
Chairman, Board of Trustees
COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS
New Assump Old Assump
10/1/2016 10/1/2016
A. Participant Data
Actives
124
124
Service Retirees
50
50
DROP Retirees
4
4
Beneficiaries
5
5
Disability Retirees
9
9
Terminated Vested
18
18
Total
210
210
Total Annual Payroll
$5,671,117
$5,671,117
Payroll Under Assumed Ret. Age
5,671,117
5,671,117
Annual Rate of Payments to:
Service Retirees
1,827,167
1,827,167
DROP Retirees
241,778
241,778
Beneficiaries
79,160
79,160
Disability Retirees
245,448
245,448
Terminated Vested
65,097
65,097
B. Assets
Actuarial Value (AVA)' 42,688,860 42,688,860
Market Value (MVA)' 42,432,734 42,432,734
C. Liabilities
Present Value of Benefits
Actives
Retirement Benefits
18,434,675
19,477,264
Disability Benefits
2,855,914
2,920,603
Death Benefits
385,619
403,332
Vested Benefits
1,385,733
1,451,891
Refund of Contributions
395,278
376,659
Service Retirees
19,266,774
19,266,774
DROP Retirees'
3,129,170
3,129,170
Beneficiaries
823,420
823,420
Disability Retirees
2,622,365
2,622,365
Terminated Vested
498,843
498,843
Excess State Monies Reserve
0
1.623,181
Total
49,797,791
52,593,502
New Assump
Old Assump
C. Liabilities - (Continued)
10/1/2016
10/1/2016
Present Value of Future Salaries
43,658,747
43,658,747
Present Value of Future
Member Contributions
2,226,596
2,226,596
Normal Cost (Retirement)
677,804
733,882
Normal Cost (Disability)
218,859
222,539
Normal Cost (Death)
21,678
22,748
Normal Cost (Vesting)
93,042
98,197
Normal Cost (Refunds)
64,125
61,451
Total Normal Cost
1,075,508
1,138,817
Present Value of Future
Normal Costs
7,700,416
8,264,311
Accrued Liability (Retirement)
13,424,025
13,971,978
Accrued Liability (Disability)
1,294,369
1,325,215
Accrued Liability (Death)
231,141
238,773
Accrued Liability (Vesting)
739,063
764,010
Accrued Liability (Refunds)
68,205
65,462
Accrued Liability (Inactives)
26,340,572
26,340,572
Excess State Monies Reserve
0
1,623,181
Total Actuarial Accrued Liability (AL)
42,097,375
44,329,191
Unfunded Actuarial Accrued
Liability (URAL)
(591,485)
1,640,331
Funded Ratio (AVA / AL)
101.4%
96.3%
D. Actuarial Present Value of New Assume Old Assump
Accrued Benefits 10/1/2016 10/1/2016
Vested Accrued Benefits
Inactives '
Actives
Member Contributions
Total
Non -vested Accrued Benefits
Total Present Value
Accrued Benefits (PVAB)
Funded Ratio (MVA / PVAB)
Increase (Decrease) in Present Value of
Accrued Benefits Attributable to:
Plan Amendments
Assumption Changes
New Accrued Benefits
Benefits Paid
Interest
Other
Total
26,340,572
8,053,422
2,951,830
37,345,824
846,149
38,191,973
111.1%
0
0
0
0
0
0
0
26,340,572
8,053,422
2,951,830
37,345,824
846,149
38,191,973
111.1%
New Assump Old Assump
Valuation Date 10/1/2016 10/1/2016
Applicable to Fiscal Year Ending 9/30/2018 9/30/2018
E. Pension Cost
Normal Cost (with interest)
% of Total Annual Payroll' 19.7 20.9
Administrative Expenses (with interest)
% of Total Annual Payroll' 1.3 1.3
Payment Required to Amortize
Unfunded Actuarial Accrued
Liability over 20 years
(as of 10/1/2016, with interest)
% of Total Annual Payroll 2 4.9 7.9
Total Required Contribution
% of Total Annual Payroll 2 25.9 30.1
Expected Member Contributions
% of Total Annual Payroll Z 6.1 5.1
Expected City and State Contribution
% of Total Annual Payroll' 19.8 25.0
' The asset values and liabilities for DROP Members include accumulated DROP
Balances as of 9/30/2016.
2 Contributions developed as of 10/1/2016 are expressed as a percentage of total
annual payroll at 10/1/2016 of $5,671,117.
Mortality Rate
ACTUARIAL ASSUMPTIONS & METHODS
Healthy Lives:
Female: RP2000 Generational, 100% Annuitant White
Collar, Scale BB
Male: RP2000 Generational, 10% Annuitant White
Collar / 90% Annuitant Blue Collar, Scale BB
Disabled Lives:
Female: 60% RP2000 Disabled Female set forward two
years / 40% Annuitant White Collar with no setback, no
projection scale
Male: 60% RP2000 Disabled Male setback four years /
40% Annuitant White Collar with no setback, no
projection scale
The assumed rates of mortality were mandated by Chapter
2015-157, Laws of Florida. This law mandates the use of
the assumptions used in either of the two most recent
valuations of the Florida Retirement System (FRS). The
above rates are those outlined in the July 1, 2015 FRS
actuarial valuation report for special risk employees. We
feel this assumption sufficiently accommodates future
mortality improvements.
Interest Rate 7.75% per year, compounded annually, net of investment
related expenses. This is supported by the target asset
class allocation of the trust and the expected long-term
return by asset class.
Retirement Age Earlier of. 1.) age 56 and 11 years of service or 2.) the
completion of 26 years of Service, regardless of age. In
addition, members who are eligible to retire on the
valuation date are assumed to retire one year later. This is
based on the results of an actuarial experience study
issued March 15, 2013.
Early Retirement Commencing with the earliest Early Retirement
Age (45), members are assumed to retire with an
immediate subsidized benefit at the rate of 2.5% per year.
This is based on the results of an actuarial experience
study issued March 15, 2013.
Disability Rate See table below (5 times 1202). 75% of disabilities
assumed to be service -incurred. This is based on the
results of an actuarial experience study issued March 15,
2013.
Termination Rate See table below (80% 1304). This is based on the results
of an actuarial experience study issued March 15, 2013.
Salary Increases
PavrollIncreases
Administrative Expenses
Funding Method
Actuarial Asset Method
5.0% per year until the assumed retirement age; see table
below. This is based on the results of an actuarial
experience study issued March 15, 2013.
0% (prior assumption 1.93% per year).
$70,378 per year. This assumption is equal to the
amount paid out of the trust in the prior year.
Entry Age Normal Actuarial Cost Method.
Each year, the prior Actuarial Value of Assets is brought
forward utilizing the historical geometric four-year
average Market Value return (net of fees). It is possible
that over time this technique will produce an insignificant
bias above or below Market Value of Assets.
Current Salary
% Becoming Disabled as % of Salary
During the Year at age 50
0.26% 23.1%
0.29 37.7
0.61 61.4
2.15% 100.0
% Terminating
Age
During the Year
20
9.9%
30
8.4
40
4.6
5.0% per year until the assumed retirement age; see table
below. This is based on the results of an actuarial
experience study issued March 15, 2013.
0% (prior assumption 1.93% per year).
$70,378 per year. This assumption is equal to the
amount paid out of the trust in the prior year.
Entry Age Normal Actuarial Cost Method.
Each year, the prior Actuarial Value of Assets is brought
forward utilizing the historical geometric four-year
average Market Value return (net of fees). It is possible
that over time this technique will produce an insignificant
bias above or below Market Value of Assets.
Current Salary
% Becoming Disabled as % of Salary
During the Year at age 50
0.26% 23.1%
0.29 37.7
0.61 61.4
2.15% 100.0
SUMMARY OF PLAN PROVISIONS
(Through Ordinance 4332)
Effective Date of New Plan
Latest Amendment
Credited Service
Earnings
Average Final Compensation
Normal Retirement
Date
Benefit Amount
Form of Benefit
Early Retirement
Date
Benefit
Disability Benefit
Eligibility
Benefit Amount
On -Duty Benefit Minlnitlllls
Regular
Malicious or Intentional
Act
Duration
November 23, 1985
July 22, 2013
Total years and fractional parts of years of service as a
full-time Police Officer excluding service for which
Member Contributions have been refunded.
Base pay, including Education Incentive Payments.
Average of Earnings paid during the best 5 during the 10
years preceding termination.
Earlier of 1) Age 55 with 10 years of Credited Service or
2) the completion of 25 years of Credited Service,
regardless of age.
3.5% of Average Final Compensation
times
Years of Credited Service
10 Year Certain and Life thereafter (options available).
Age 45 and 10 years of Credited Service.
Accrued benefit, reduced 3.0% for each year that early
retirement precedes normal retirement.
Total and permanent as determined by the Board of
Trustees. 5 years of service required for Off -Duty
benefits.
Accrued benefit.
50% of base pay at disability
80% of Average Final Compensation
Benefit commences upon Board approval and is paid for
life (with 120 payments guaranteed), or until recovery, as
determined by the Board. Optional forms
of payment available.
Death Benefit
Pre -Retirement
Not Vested Refund of Member Contributions. (Includes amount
contributed by the City for the Member).
Vested
Non -Service
Incurred Accrued benefit paid to Beneficiary for 10 Years
beginning on the date the Member would have reached
Normal Retirement (or a reduced amount payable
immediately).
Service Incurred Greater of accrued benefit or 40% of Average Final
Compensation paid to Beneficiary for 10 years
immediately.
Post -Retirement According to option selected, if any.
Vesting (Termination)
Less than 10 years Refund of Member Contributions. (Includes
of Credited Service amounts contributed by the City for the Member).
10 years or more Accrued benefit payable at the Member's
election, on his otherwise Early or Normal Retirement
Date
or
Refund of Member Contributions. (Includes amount
contributed by the City for the Member).
Contributions
Employee 5.1% of gross pay plus 5.0% of Earnings (paid by the
City).
Premium Tax 0.85% tax on casualty insurance premiums.
City Remaining amount necessary for payment of Normal
(current year's) Cost and amortization of the accrued past
service liability, but not less than 10% of members'
earnings (including 5% contribution for members).
Board of Trustees
Deferred Retirement Option Plan
a. Two legal residents appointed by
the City Commission,
b. 2 Police Officers (selected by
majority of Department Members),
C. Fifth Member elected by the other
four Board Members and approved by the
Commission.
Eligibility Satisfaction of Normal Retirement requirements (earlier of
(1) Age 55 with 10 years of Credited Service, or (2) 25
years of Credited Service).
Participation Not to exceed 60 months.
Rate of Return Actual net rate of investment return (total return net of
brokerage commissions, management fees and transaction
costs) credited each fiscal quarter.
Form of Distribution Cash lump sum (options available) at termination of
employment.