4381 Police Retirement SystemOrdinance No. 2016 -4381
An Ordinance of the City of Sanford, Florida, Amending
Chapter 66, pensions and retirement, Article 11, police
officers' retirement system of the Code of Ordinances of
the City of Sanford; amending Section 66 -31, Definitions;
amending section 66 -32, Membership; amending Section
66 -34, finances and fund management; amending Section
66 -36, Benefit amounts and eligibility; amending Section
66 -37, Optional forms of benefits; amending Section 66-44,
Prior police service; amending Section 66-46, Deferred
retirement option plan; removing Section 66-47,
Conviction and forfeiture; false, misleading or fraudulent
statements; 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 to read as follows by amending
Section 66 -31, Definitions, by amending the definitions of "Accumulated Contributions ",
"Actuarial Equivalent ", "Credited Service ", and "Spouse ", to read as follows:
Accumulated contributions means a member's own contributions, plus the amount
described in section 2 2'T(4) 66- 36(e)(3), all without interest. For those members who
purchase credited service with interest or at no cost to the system, any payment
representing the amount attributable to member contributions based on the applicable
member contribution rate, interest and any required actuarially calculated payments forthe
purchase of such credited service, shall be included in accumulated contributions.
For the purposes of this Ordinance, underlined type shall constitute additions to the original text, * * * shall constitute ellipses to the
original text and strileethrotigh shall constitute deletions to the original text.
Actuarial equivalent means a benefit or amount of equal value, based upon the RP
2000 Combined Healthy Unisex Mortality Table and an interest rate of eight (8) peFGent pe
aRnum equal to the investment return assumption set forth in the last actuarial valuation
approved by the Board. This definition may only be amended by the city pursuant to the
recommendation of the board using the assumptions adopted by the board with the advice
of the plan's actuary, such that actuarial assumptions are not subject to city discretion.
Credited service means the total number of years and fractional parts of years of
service as a police officer with member contributions when required, omitting intervening
years or fractional parts of years when such member was not employed by the city as a
police officer. A member may voluntarily leave his accumulated contributions in the fund
for a period of five (5) years after leaving the employ of the police department pending the
possibility of being reemployed as a police officer, without losing credit for the time that he
was a member of the system. If a vested member leaves the employ of the police
department, his accumulated contributions will be returned only upon his written request. If
a member who is not vested is not reemployed as a police officer with the police
department within five (5) years, his accumulated contributions, if one - thousand dollars
($1,000.00) or less, shall be returned. If a member who is not vested is not reemployed
within five (5) years, his accumulated contributions, if more than one - thousand dollars
($1,000.00), will be returned only upon the written request of the member and upon
completion of a written election to receive a cash lump sum or to rollover the lump sum
amount on forms designated by the board. Upon return of a member's accumulated
contributions, all of his rights and benefits under the system are forfeited and terminated.
Upon any reemployment, a police officer shall not receive credit for the years and fractional
parts of years of service for which he has withdrawn his accumulated contributions from the
fund, unless the police officer repays into the fund the contributions he has withdrawn, with
interest, as determined by the board, within ninety (90) days after his reemployment.
In addition, a member may receive credited service for periods which the member is
absent from employment and receiving workers' compensation benefits for injuries
sustained while acting as a police officer for the city, up to the time maximum medical
improvement is reached, as determined in accordance with the Florida Workers'
Compensation Law.
The years or fractional parts of years that a member performs "Qualified Military
Service" consisting of voluntary or involuntary "service in the uniformed services" as
defined in the Uniformed Services Employment and Reemployment Rights Act (USERRA)
(P. L.103 -353), after separation from employment as a police officer with the city to perform
training or service, shall be added to his years of credited service for all purposes, including
vesting, provided that:
(a) The member is entitled to reemployment under the provisions of USERRA.
(b) The member returns to his employment as a police officer within one (1) year
from the earlier of the date of his military discharge or release from active
service, unless otherwise required by USERRA.
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.
(c) The maximum credit for military service pursuant to this paragraph shall be
five (5) years.
(d) This paragraph is intended to satisfy the minimum requirements of USERRA.
To the extent that this paragraph does not meet the minimum standards of
USERRA, as it may be amended from time to time, the minimum standards
shall apply.
In the event a member dies on or after January 1, 2007, while performing USERRA
Qualified Military Service, the beneficiaries of the member are entitled to any benefits
(other than benefit accruals relating to the period of qualified military service) as if the
member had resumed employment and then died while employed.
Beginning January 1, 2009, to the extent required by section 414(u)(12) of the code,
an individual receiving differential wage payments (as defined under section 3401(h)(2) of
the code) from an employer shall be treated as employed by that employer, and the
differential wage payment shall be treated as compensation for purposes of applying the
limits on annual additions under section 415(c) of the code. This provision shall be applied
to all similarly situated individuals in a reasonably equivalent manner.
P.-IT•10TU
id time off shall not be r)ermitted to be
nt.
Spouse means the lawful wife GF husband of a mernbeF 9F FetiF member's or
retiree's spouse under applicable law at the time benefits become payable.
Section 3. Police Officers' Retirement System. Chapter 66, Article 11, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by amending
Section 66-34, Finances and Fund Management, subsection (6)(b)3., to read as follows:
3. In addition, the board may, upon recommendation by the board's
investment consultant, make investments in group trusts meeting the
requirements of Internal Revenue Service Revenue Ruling 81-100,.
a-nd Revenue Ruling 2011-1, IRS Notice 2012-6 and Revenue Ruling
2014-24 or successor rulings or guidance of similar import, and
operated or maintained exclusively for the commingling and collective
investment of monies, provided that the funds in the group trust
consist exclusively of trust assets held under plans qualified under
section 401(a) of the code, individual retirement accounts that are
exempt under section 408(e) of the code, eligible governmental plans
that meet the requirements of section 457(b) of the code, and
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.
governmental plans under 401(a)(24) of the code. For this purpose, a
trust includes a custodial account or a separate tax favored account
maintained by an insurance company that is treated as a trust under
section 401(f) or under section 457(g)(3) of the code. While any
portion of the assets of the fund are invested in such a group trust,
such group trust is itself adopted as a part of the system or plan.
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fund are transferred oursuant to subsection 3. shall be adopted
participation, adoption agreements, and /or trust agreements
with the group trust's trustee.
Section 4. Police Officers' Retirement System. Chapter 66, Article II, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by amending
Section 66 -36, Benefit Amounts and Eligibility, subsection (a), Normal Retirement,
subsection (a)(1), Normal Retirement Date, to read as follows:
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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.
Section 5. Police Officers' Retirement System. Chapter 66, Article II, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by amending
Section 66 -36, Benefit Amounts and Eligibility, subsection (d), Disability, subsection (d)(1),
Disability Benefits On -Duty, subsection (d)(3), Disability Benefits Off -Duty, and subsection
(d)(6), Disability Payments, to read as follows:
(d)(1) Disability benefits on -duty. Any member who shall become totally and
permanently disabled to the extent that he 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, 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, either vested or non - vested, are not eligible for
disability benefits, eXGept that— these terminated the pity far ry ediGal
(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 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 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.
Terminated persons, either vested or non- vested, are not eligible for
disability benefits, eXG r't th se terminator) by the pity fnr medinal
reasGR6 Fnay apply f--F, a disability WithiR 30 days 'rcer termilIation.
Notwithstanding the previous sentence, if a member is terminated by the citx
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.
(d)(6) Disability payments. The monthly benefit to which a member is entitled in
the event of the member's disability retirement shall be payable on the first
day of the first month after the board determines such entitlement. However,
the monthly retirement income shall be payable as of the date the board
determined such entitlement, and any portion due for a partial month shall be
paid together with the first payment. The last payment will be:
a. If the retiree recovers from the disability, the payment due next
preceding the date of such recovery, or
b. If the retiree dies without recovering from disability, the payment due
next preceding his death or the one hundred twentieth monthly
payment, whichever is later.
Provided, however, the disability retiree may select, at any time prior to the
date on which benefit payments begin, an optional form of benefit payment
as described in section 66 -37, subsection (1)(a) or (1)(b), which shall be the
actuarial equivalent of the normal form of benefit.
Section 6. Police Officers' Retirement System. Chapter 66, Article Il, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by amending
Section 66 -36, Benefit Amounts and Eligibility, subsection (f), Maximum Pension, by
amending subsections (f)(6), (f)(8), (f)(12), and by adding subsection (f)(13), to read as
follows:
(f)(6) Less than ten years of participation — .— The maximum retirement
benefits payable under this section to any member who has completed less
than ten years of GFedited sePWiGe with the Gity participation shall be the
amount determined under subsection (1) of this section multiplied by a
fraction, the numerator of which is the number of the member's years of
c-redit°�'�oc participation and the denominator of which is ten. The
reduction provided by this subsection cannot reduce the maximum benefit
below ten percent of the limit determined without regard to this subsection.
The reduction provided for in this subsection shall not be applicable to
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.
pre- retirement disability benefits paid pursuant to section 66- 36(d), or
pre- retirement death benefits paid pursuant to section 66- 36(c).
(f)(8) Ten thousand dollar limit; less than ten years of service. Notwithstanding
anything in this section 66- 36(f), the retirement benefit payable with respect
to a member shall be deemed not to exceed the limit set forth in this
subsection (f)(8) of section 66 -36 if the benefits payable, with respect to such
member under this system and under all other qualified defined benefit
pension plans to which the city contributes, do not exceed $10,000.00 for the
applicable limitation year and or for any prior limitation year= and the city has
not at any time maintained a qualified defined contribution plan in which the
member participated; provided, however, that if the member has completed
less than ten years of credited service with the city, the limit under this
subsection (f)(8) of section 66 -36 shall be a reduced limit equal to
$10,000.00 multiplied by a fraction, the numerator of which is the number of
the member's years of credited service and the denominator of which is ten.
(f) (12) b. No member of the system shall be allowed to receive a retirement
benefit or pension which is in part or in whole based upon any service
with respect to which the member is already receiving, or will receive
in the future, a retirement benefit or pension from a different
employer's retirement system or plan. This restriction does not apply
to social security benefits or federal benefits under Chapter 67 1223,
Title 10, U.S. Code.
Section 7. Police Officers' Retirement System. Chapter 66, Article II, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by amending
Section 66 -36, Benefit Amounts and Eligibility, subsection (g), Minimum Distribution of
Benefits, subsection (g)(2)b.4., to read as follows:
(g) (2) b. 4. If the member's surviving spouse is the member's sole
designated beneficiary and the surviving spouse dies after the
member but before distributions to the surviving spouse begin,
this subsection (2)b., other than subsection (2)b.1., will apply
as if the surviving spouse were the member.
For purposes of this subsection (2)b. ,
distributions are considered to begin on the member's required
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.
beginning date or, if subsection (2)b.4. applies, the date of
distributions are required to begin to the surviving spouse
under subsection (2)b.1. If annuity payments irrevocably
commence to the member before the member's required
beginning date (or to the member's surviving spouse before
the date distributions are required to begin to the surviving
spouse under subsection (2)b.1.) the date distributions are
considered to begin is the date distributions actually
commence.
Section 8. Police Officers' Retirement System. Chapter 66, Article II, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by amending
Section 66 -37, Optional Forms of Benefits, subsections (1)(d) and (2), to read as follows:
(d) For members who do not participate in the DROP pursuant to section 66-46,
the member may elect a percentage of benefit in a lump sum as follows:
1. Ten percent of the total actuarial equivalent value of the benefit paid
as a lump sum with the remaining 90 percent paid under the normal
form or as per (a), (b) or (c) above.
2. Fifteen percent of the total actuarial equivalent value of the benefit
paid as a lump sum with the remaining 85 percent paid under the
normal form or as per (a), (b) or (c) above.
3. Twenty percent of the total actuarial equivalent value of the benefit
paid as a lump sum with the remaining 80 percent paid under the
normal form or as per (a), (b) or (c) above.
4. Twenty -five percent of the total actuarial equivalent value of the
benefit paid as a lump sum with the remaining 75 percent paid under
the normal form or as per (a), (b) or (c) above.
(2) The member, upon electing any option of this section, will designate the joint
pensioner (subsection (1)(b) above) or beneficiary (or beneficiaries) to receive the benefit,
if any, payable under the system in the event of member's death, and will have the power
to change such designation from time to time. Such designation will name a joint pensioner
or one or more primary beneficiaries where applicable. A member may change his
beneficiary at any time. If a member has elected an option with a joint pensioner and the
member's retirement income benefits have commenced, the member may thereafter
change his designated beneficiary at any time, but may only change his joint pensioner
twice. Subject to the restriction in the previous sentence, a member may substitute a new
joint pensioner for a deceased joint pensioner. Effective January 1, 2005, any current
retiree, regardless of his date of retirement, may elect the options provided for in this
subsection (2). In the absence of proof of good health of the joint pensioner beinq
replaced. the actuary will assume that the ioint pensioner has deceased for purposes of
For the purposes of this Ordinance, underlined type shall constitute additions to the original text,*** shall constitute ellipses to the
original text and str;kethrough shall constitute deletions to the original text.
Section 9. Police Officers' Retirement System. Chapter 66, Article 11, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by amending
Section 66 -44, Prior Police Service, subsection (6), to read as follows:
(6) In no event, however, may credited service be purchased pursuant to this
section for prior service with any other municipal, county or state law
enforcement agency, if such prior service forms or will form the basis of a
retirement benefit or pension from a different employer's retirement system
or plan as set forth in section 66 -36, subsection (# (! 1)b 12 b.
Section 10. Police Officers' Retirement System. Chapter 66, Article II, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by amending
Section 66-46, Deferred Retirement Option Plan, to read as follows:
Sec. 66-46. Deferred retirement option plan.
(a) Definitions. As used in this section 66 -46, the following definitions apply:
(1) "DROP" means the City of Sanford Police Officers' Deferred Retirement
Option Plan.
(2) "DROP account" means the account established for each DROP participant
under subsection (c).
•rte
member's DROP account pursuant to subsection (c)(2)b.2.. for each fiscal
vear quarter. the oercentaae increase (or decrease) in the interest and
(b) Participation.
(1) Eligibility to participate. In lieu of terminating his employment as a police
officer, any member who is eligible for normal retirement under the system
may elect to defer receipt of such service retirement pension and to
participate in the DROP.
(2) Election to participate. A member's election to participate in the DROP must
be made in writing in a time and manner determined by the board and shall
be effective on the first day of the first calendar month which is at least 15
business days after it is received by the board.
(3) Period of participation. A member who elects to participate in the DROP
under subsection (b)(2), shall participate in the DROP for a period not to
For the purposes of this Ordinance, underlined type shall constitute additions to the original text, * * * shall constitute ellipses to the
original text and strrlceth eagle shall constitute deletions to the original text.
exceed 60 months beginning at the time his election to participate in the
DROP first becomes effective. An election to participate in the DROP shall
constitute an irrevocable election to resign from the service of the city not
later than the date provided for in the previous sentence. A member may
participate only once.
(4) Termination of participation.
a. A member's participation in the DROP shall cease at the earlier of:
1. The end of his permissible period of participation in the DROP
as determined under subsection (b)(3); or
2. Termination of his employment as a police officer.
b. Upon the member's termination of participation in the DROP,
pursuant to subsection 1. above, all amounts provided for in
subsection (c)(2), including monthly benefits and investment earnings
and losses, shall cease to be transferred from the system to his
DROP account. Any amounts remaining in his DROP account shall be
paid to him in accordance with the provisions of subsection (d) when
he terminates his employment as a police officer.
C. A member who terminates his participation in the DROP under this
subsection (b)(4) shall not be permitted to again become a participant
in the DROP.
(5) Effect of DROP participation on the system.
a. A member's credited service and his accrued benefit under the
system shall be determined on the date his election to participate in
the DROP first becomes effective. For purposes of determining the
accrued benefit, the member's base pay for the purposes of
calculating his average final compensation shall include an amount
equal to any lump sum payments which would have been paid to the
member and included as base pay as defined herein, had the
member retired under normal retirement and not elected DROP
participation. Member contributions attributable to any lump sums
used in the benefit calculation and not actually received by the
member shall be deducted from the first payments to the member's
DROP account. The member shall not accrue any additional credited
service or any additional benefits under the system (except for any
supplemental benefit payable to DROP participants or any additional
benefits provided under any cost -of- living adjustment for retirees in
the system) while he is a participant in the DROP. After a member
commences participation, he shall not be permitted to again
contribute to the system nor shall he be eligible for disability or
pre- retirement death benefits, except as provided for in section 66-45,
reemployment after retirement.
For the purposes of this Ordinance, underlined type shall constitute additions to the original text,*** shall constitute ellipses to the
original text and str-ilethrough shall constitute deletions to the original text.
IIIIIJ
b. No amounts shall be paid to a member from the system while the
member is a participant in the DROP. Unless otherwise specified in
the system, if a member's participation in the DROP is terminated
other than by terminating his employment as a police officer, no
amounts shall be paid to him from the system until he terminates his
employment as a police officer. Unless otherwise specified in the
system, amounts transferred from the system to the member's DROP
account shall be paid directly to the member only on the termination
of his employment as a police officer.
(c) Funding.
(1) Establishment of DROP account. A DROP account shall be established for
each member participating in the DROP. A member's DROP account shall
consist of amounts transferred to the DROP under subsection (c)(2), and
earnings on those amounts.
(2) Transfers from retirement system.
a. As of the first day of each month of a member's period of participation
in the DROP, the monthly retirement benefit he would have received
under the system had he terminated his employment as a police
officer and elected to receive monthly benefit payments thereunder
shall be transferred to his DROP account, except as otherwise
provided for in subsection (b)(4)b. A member's period of participation
in the DROP shall be determined in accordance with the provisions of
subsections (b)(3) and (b)(4), but in no event shall it continue past the
date he terminates his employment as a police officer.
b. Except as otherwise provided in subsection (b)(4)b., a member's
DROP account under this subsection (c)(2) shall be debited or
credited after eaGh fiGGaI year quafter-with earnings, to be credited or
such date, determined as
The average daily balance in a member's DROP account shall be
credited or debited at a rate equal to the net investment return
realized by the system for that quarter. "Net investment return" for the
purpose of this paragraph is the total return of the assets in which the
member's DROP account is invested by the board net of brokerage
commissions, transaction costs and management fees.
un)oses of calculatina earninas on a member's DROP account
auarter by the investment consultant pursuant to contracts with fund
consultant shall report these auarterlv contractual fees to the board.
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.
11
for each manager and the net investment return for the total plan
assets.
C. A member's DROP account shall only be credited or debited with
earnings and monthly benefits while the member is a participant in the
DROP. A member's final DROP account value for distribution to the
member upon termination of participation in the DROP shall be the
value of the account at the end of the quarter immediately preceding
termination of participation date plus any monthly periodic additions
made to the DROP account subsequent to the end of the previous
quarter and prior to distribution. If a member fails to terminate
employment after participating in the DROP for the permissible period
of DROP participation, then beginning with the member's 1 st month of
employment following the last month of the permissible period of
DROP participation, the member's DROP account will no longer be
credited or debited with earnings, nor will monthly benefits be
transferred to the DROP account. All such non-transferred amounts
shall be forfeited and continue to be forfeited while the member is
employed by the police department. A member employed by the
police department after the permissible period of DROP participation
will still not be eligible for pre-retirement death or disability benefits,
and he will accrue additional credited service only as provided for in
section 2-275 66-45.
(d) Distribution of DROP accounts on termination of employment.
(1) Eligibility for benefits. A member shall receive the balance in his DROP
account in accordance with the provisions of this subsection (d) upon his
termination of employment as a police officer. Except as provided in
subsection (d)(5), no amounts shall be paid to a member from the DROP
prior to his termination of employment as a police officer.
(2) Form of distribution.
a. Unless the member elects otherwise, distribution of his DROP
account shall be made in a lump sum, subject to the direct rollover
provisions set forth in subsection (d)(6). Elections under this
paragraph shall be in writing and shall be made in such time or
manner as the board shall determine.
b. If a member dies before his benefit is paid, his DROP account shall
be paid to his beneficiary in such optional form as his beneficiary may
select. If no beneficiary designation is made, the DROP account shall
be distributed to the member's estate.
(3) Date of payment of distribution. Except as otherwise provided in this
subsection (d), distribution of a member's DROP account shall be made as
soon as administratively practicable following the member's termination of
employment. Distribution of the amount in a member's DROP account will
not be made unless the member completes a written request for distribution
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.
12
and a written election, on forms designated by the board, to either receive a
cash lump sum or a rollover of the lump sum amount.
(4) Proof of death and right of beneficiary or other person. The board may
require and rely upon such proof of death and such evidence of the right of
any beneficiary or other person to receive the value of a deceased member's
DROP account as the board may deem proper and its determination of the
right of that beneficiary or other person to receive payment shall be
conclusive.
(5) Distribution limitation. Notwithstanding any other provision of this subsection
(d), all distributions from the DROP shall conform to the "Minimum
distribution of benefits" provisions as provided for herein.
(6) Direct rollover-of certain distributions. This subsection applies to distributions
made on or after January 1, 2002. Notwithstanding any provision of the
DROP to the contrary, a distributee may elect to have any portion of an
eligible rollover distribution paid in a direct rollover as otherwise provided
under the system in section 2 271 66-41.
(e) Administration of DROP.
(1) Board administers the DROP. The general administration of the DROP, the
responsibility for carrying out the provisions of the DROP and the
responsibility of overseeing the investment of the DROP's assets shall be
placed in the board. The members of the board may appoint from their
number such subcommittees with such powers as they shall determine; may
adopt such administrative procedures and regulations as they deem
desirable for the conduct of their affairs; may authorize one or more of their
number or any agent to execute or deliver any instrument or make any
payment on their behalf; may retain counsel, employ agents and provide for
such clerical, accounting, actuarial and consulting services as they may
require in carrying out the provisions of the DROP; and may allocate among
themselves or delegate to other persons all or such portion of their duties
under the DROP, other than those granted to them as trustee under any trust
agreement adopted for use in implementing the DROP, as they, in their sole
discretion, shall decide. A trustee shall not vote on any question relating
exclusively to himself.
(2) Individual accounts, records and reports. The board shall maintain records
showing the operation and condition of the DROP, including records showing
the individual balances in each member's DROP account, and the board
shall keep in convenient form such data as may be necessary for the
valuation of the assets and liabilities of the DROP. The board shall prepare
and distribute to members participating in the DROP and other individuals or
file with the appropriate governmental agencies, as the case may be, all
necessary descriptions, reports, information returns, and data required to be
distributed or filed for the DROP pursuant to the Code and any other
applicable laws.
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.
13
(3) Establishment of rules. Subject to the limitations of the DROP, the board
from time to time shall establish rules for the administration of the DROP and
the transaction of its business. The board shall have discretionary authority
to construe and interpret the DROP (including but not limited to
determination of an individual's eligibility for DROP participation, the right and
amount of any benefit payable under the DROP and the date on which any
individual ceases to be a participant in the DROP). The determination of the
board as to the interpretation of the DROP or its determination of any
disputed questions shall be conclusive and final to the extent permitted by
applicable law.
(4) Limitation of liability.
a. The trustees shall not incur any liability individually or on behalf of any
other individuals for any act or failure to act, made in good faith in
relation to the DROP or the funds of the DROP.
b. Neither the board nor any trustee of the board shall be responsible for
any reports furnished by any expert retained or employed by the
board, but they shall be entitled to rely thereon as well as on
certificates furnished by an accountant or an actuary, and on all
opinions of counsel. The board shall be fully protected with respect to
any action taken or suffered by it in good faith in reliance upon such
expert, accountant, actuary or counsel, and all actions taken or
suffered in such reliance shall be conclusive upon any person with
any interest in the DROP.
(f) General provisions.
The DROP is not a separate retirement plan. Instead, it is a program
[ �Z�• ��[+ Ii17: bi: ��• 7�iLat�tY�t%[ ���Iiil�' 3�i7[ I�IiLaii# �I�iTaiil "Y_liill�LaT�1-�"iiY11
member is entitled to a lump sum distribution of his or her DROP account
No employer discretion. The DROP benefit is determined pursuant to a
specific formula which does not involve employer discretion.
For the purposes of this Ordinance, underlined type shall constitute additions to the original text,*** shall constitute ellipses to the
original text and strikethratrgh shall constitute deletions to the original text.
14
(4-5) Amendment of DROP. The DROP may be amended by an ordinance of the
city at any time and from time to time, and retroactively if deemed necessary
or appropriate, to amend in whole or in part any or all of the provisions of the
DROP. However, except as otherwise provided by law, no amendment shall
make it possible for any part of the DROP's funds to be used for, or diverted
to, purposes other than for the exclusive benefit of persons entitled to
benefits under the DROP. No amendment shall be made which has the
effect of decreasing the balance of the DROP account of any member.
(2 6) Facility of payment. If a member or other person entitled to a benefit under
the DROP is unable to care for his affairs because of illness or accident or is
a minor, the board shall direct that any benefit due him shall be made only to
a duly appointed legal representative. Any payment so made shall be a
complete discharge of the liabilities of the DROP for that benefit.
(3 7) Information. Each member, beneficiary or other person entitled to a benefit,
before any benefit shall be payable to him or on his account under the
DROP, shall file with the board the information that it shall require to
establish his rights and benefits under the DROP.
(4 8) Prevention of escheat. If the board cannot ascertain the whereabouts of any
person to whom a payment is due under the DROP, the board may, no
earlier than three years from the date such payment is due, mail a notice of
such due and owing payment to the last known address of such person, as
shown on the records of the board or the city. If such person has not made
written claim therefor within three months of the date of the mailing, the
board may, if it so elects and upon receiving advice from counsel to the
DROP, direct that such payment and all remaining payments otherwise due
such person be canceled on the records of the DROP. Upon such
cancellation, the DROP shall have no further liability therefor except that, in
the event such person or his beneficiary later notifies the board of his
whereabouts and requests the payment or payments due to him under the
DROP, the amount so applied shall be paid to him in accordance with the
provisions of the DROP.
(5 9) Written elections, notification.
a. Any elections, notifications or designations made by a member
pursuant to the provisions of the DROP shall be made in writing and
filed with the board in a time and manner determined by the board
under rules uniformly applicable to all employees similarly situated.
The board reserves the right to change from time to time the manner
for making notifications, elections or designations by members under
the DROP if it determines after due deliberation that such action is
justified in that it improves the administration of the DROP. In the
event of a conflict between the provisions for making an election,
notification or designation set forth in the DROP and such new
administrative procedures, those new administrative procedures shall
prevail.
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.
15
b. Each member or retiree who has a DROP account shall be
responsible for furnishing the board with his current address and any
subsequent changes in his address. Any notice required to be given
to a member or retiree hereunder shall be deemed given if directed to
him at the last such address given to the board and mailed by
registered or certified United States mail. If any check mailed by
registered or certified United States mail to such address is returned,
mailing of checks will be suspended until such time as the member or
retiree notifies the board of his address.
(6 10) Benefits not guaranteed. All benefits payable to a member from the DROP
shall be paid only from the assets of the member's DROP account and
neither the city nor the board shall have any duty or liability to furnish the
DROP with any funds, securities or other assets except to the extent required
by any applicable law.
(7 11) Construction.
a. The DROP shall be construed, regulated and administered under the
laws of Florida, except where other applicable law controls.
b. The titles and headings of the subsections in this section 66-46 are
for convenience only. In the case of ambiguity or inconsistency, the
text rather than the titles or headings shall control.
(9 12) Forfeiture of retirement benefits. Nothing in this section shall be construed to
remove DROP participants from the application of any forfeiture provisions
applicable to the system. DROP participants shall be subject to forfeiture of
all retirement benefits, including DROP benefits.
(9 13) Effect of DROP participation on employment. Participation in the DROP is
not a guarantee of employment and DROP participants shall be subject to
the same employment standards and policies that are applicable to
employees who are not DROP participants.
Section 11. Police Officers' Retirement System. Chapter 66, Article 11, Code of
Ordinances of the City of Sanford, is hereby amended to read as follows by removing the
current Section 66-47, Conviction and Forfeiture; False, Misleading or Fraudulent
Statements, to read as follows:
FA .29.. =I . . .. . � I 9 �-� f.� MR7
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.
16
Section 12 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 13 Conflicts. All Ordinances or parts of Ordinances in conflict with this
Ordinance are hereby repealed.
Section 14 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 15. Codification. Sections 2 -11 of this Ordinance shall become and be
made a part of the Code of Ordinances of the City of Sanford, Florida.
Section 16. Effective Date. This Ordinance shall become effective immediately
upon enactment by the City Commission.
Passed and Adopted this 27th day of June, A.D. 2016.
Attest: City Commi ion f the City of
Sanford, FlopfAa _
Cynthia Porter, City Clerk Jeff Triplett,
Approved as to form and legal sufficiency:
William L. Colbert, City Attorney
For the purposes of this Ordinance, underlined type shall constitute additions to the original text,*** shall constitute ellipses to the
original text and strtkethrough shall constitute deletions to the original text.
17
WS RM X
877 — Item No. 7 - Jb
CITY COMMISSION MEMORANDUM 1 6.216
.JUNE 27, 2016 AGENDA
To: Honorable Mayor and Members of the City Commission
PREPARED BY: Cynthia Porter, City Clerk
Cynthia Lindsay, Director o mane
SUBMITTED BY: Norton N. Bonaparte, Jr., City Manag r
SUBJECT: City of Sanford Police Officers' Retire ent System Proposed Ordinance
STRATEGIC PRIORITIES: /
❑ Unify Downtown & the Waterfront
❑ Promote the City's Distinct Culture
❑ Update Regulatory Framework
❑ Redevelop and Revitalize Disadvantaged Communities
SYNOPSIS:
Ordinance No. 4381, amending City Code, Sections 66 -31, 66 -32, 66 -34, 66 -36, 66 -37, 66 -44, 66-
46, 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 February 4, 2016 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 Internal Revenue Code (IRC) relating to tax qualified pension
plans such as this plan and for language clarity.
Section 66 -31, Definitions, is being amended to amend the definition of accumulated
contributions to correct a section reference number, the definition of actuarial equivalent to
incorporate the mortality table currently being used by the plan's actuary, credited service to
clarify IRC regulations on leave conversions, and spouse to clarify the definition in
accordance with a recent US Supreme Court ruling.
• Section 66 -32, Membership, has been amended to limit those individuals eligible to opt -out
of the system, to comply with recent IRC Treasury Regulation requirements.
• Section 66 -34, Finances and Fund Management, is being amended to further incorporate
recent IRC requirements with regard to investments in commingled funds.
• Section 66 -36, Benefit amounts and eligibility, subsection (a), Normal Retirement, is being
amended to change the Normal Retirement Date to include IRC required language regarding
Normal Retirement Age and Normal Retirement Date.
Section 66 -36, subsection (d), Disability, is being amended to more clearly identify those
individuals who may be eligible to apply for a disability pension who have been terminated
by the City due to medical reasons. This section is also amended to provide that if a disabled
member is reemployed as a police officer either with the City or another municipal, county,
State or federal law enforcement department, he shall be deemed to have recovered from his
disability.
• Section 66 -36, subsection (f), Maximum Pension, has had several subsections amended to
comply with IRC changes.
• Section 66 -36, subsections (g), Minimum Distribution of Benefits, is being amended for a
reference clarification in subsection (g)(2)b.4.
• Section 66 -37, Optional Form of Benefits, has been amended to:
o Amend the optional form of benefit known as a partial lump sum option (PLOP), to
clarify that the percentage chosen is calculated as a percent of the total actuarial
equivalent value of the member's benefit.
o Amend subsection (2) to clarify that if proof of good health of a joint pensioner who
is being replaced is not provided, the actuary will assume that the joint pensioner is
deceased for purposes of calculating the revised benefit amount.
• Section 66 -44, Prior Police Service, subsection (6), is being amended to correct a reference.
• Section 66 -46, Deferred Retirement Option Plan, is being amended in accordance with recent
direction from the IRS in connection with the issuance of several recent Favorable
Determination Letters to: i) clarify investment returns on DROP accounts, ii) clarify when
interest and earnings are calculated and paid, and iii) add several sections clarifying the
DROP provisions as required by the IRS.
• The current Section 66 -47, Conviction and forfeiture; false, misleading or fraudulent
statements, is being removed in its entirety as this language is already in the Code of
Ordinances in Section 66- 36(i).
The City Commission approved the first reading of Ordinance No. 2016 -43 81 on June 13, 2016.
The City Clerk published notice of the public hearing in the Sanford Herald on June 12, 2016.
LEGAL REVIEW:
The ordinance has been prepared by the Police Officers' Pension Board attorney.
RECOMMENDATION:
The Police Officers' Pension Board recommends the City Commission adopt the ordinance.
SUGGESTED MOTION:
"I move to adopt Ordinance No. 2016 - 4381."
Attachments:
Cover letter from the Law Offices of Christiansen & Dehner, P.A.
Actuarial Impact Letter from Foster & Foster Actuaries
Ordinance No. 2016 -4381
Law Offices
Christiansen & Delmer, P.A.
63 Sarasota Center Blvd. Suite 107 Sarasota, Florida 34240 • 941.377.2200 • Fax 941.377.4848
March 23, 2016
Mr. Norton N. Bonaparte Jr.
City Manager
City of Sanford
Post Office Box 1788
Sanford, Florida 32772 -1788
" C
AR 2016
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. With changes to the Internal Revenue Code (IRC) and its associated Regulations,
guidance from the Internal Revenue Service (IRS), and changes for language clarity, the following
amendments to the pension plan are proposed:
1. Section 66 -31, Definitions, is being amended for IRC changes and requirements, to
amend the definitions of:
a. Accumulated Contributions - to correct a section reference number
b. Actuarial Equivalent - to amend the definition to incorporate the Mortality
Table currently being used by the plan's actuary
C. Credited Service - to clarify IRC regulations on leave conversions
d. Spouse - To clarify the definition in accordance with a recent US Supreme
Court ruling
2. Section 66 -32, Membership, has been amended to limit those individuals eligible to
opt -out of the system, to comply with recent IRC Treasury Regulation requirements.
3. Section 66 -34, Finances and Fund Management, is being amended to further
incorporate recent IRC requirements with regard to investments in commingled
funds.
Mr. Norton N. Bonaparte, Jr.
March 23, 2016
Page 2
4. Section 66 -36, Benefit amounts and eligibility, subsection (a), Normal Retirement,
is being amended to change the Normal Retirement Date to include IRC required
language regarding Normal Retirement Age and Normal Retirement Date.
5. Section 66 -36, subsection (d), Disability, is being amended to more clearly identify
those individuals who may be eligible to apply for a disability pension who have been
terminated by the City due to medical reasons. This section is also amended to
provide that if a disabled member is reemployed as a police officer either with the
City or another municipal, county, State or federal law enforcement department, he
shall be deemed to have recovered from his disability.
6. Section 66 -36, subsection (f), Maximum Pension, has had several subsections
amended to comply with IRC changes.
7. Section 66 -36, subsection (g), Minimum Distribution of Benefits, is being amended
for a reference clarification in subsection (g)(2)b.4.
8. Section 66 -37, Optional Forms of Benefits, has been amended to:
a. Amend the optional fonn of benefit known as a partial lump sum option
(PLOP), to clarify that the percentage chosen is calculated as a percent of the
total actuarial equivalent value of the member's benefit.
b. Amend subsection (2) to clarify that if proof of good health of a joint
pensioner who is being replaced is not provided, the actuary will assume that
the joint pensioner is deceased for purposes of calculating the revised benefit
amount.
9. Section 66 -44, Prior Police Service, subsection (6), is being amended to correct a
reference.
10. Section 66 -46, Deferred Retirement Option Plan, is being amended in accordance
with recent direction from the IRS in connection with the issuance of several recent
Favorable Determination Letters to: i) clarify investment returns on DROP accounts,
ii) clarify when interest and earnings are calculated and paid, and iii) add several
sections clarifying the DROP provisions as required by the IRS.
11. The current Section 66 -47, Conviction and forfeiture; false, misleading or fraudulent
statements, is being removed in its entirety as this language is already in the Code of
Ordinances in Section 66- 36(i).
Mr. Norton N. Bonaparte, Jr.
March 23, 2016
Page 3
By copy of this letter to the Board's actuary, Foster & Foster, Inc., I am requesting that they
provide you with a letter indicating the cost, if any, associated with the adoption of this ordinance.
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.
Yours ve ruly,
GGG✓
Scott R. Christiansen
SRC /dm
enclosure
cc: Patrick Donlan, with enclosure
FOSTER & FOSTER
S S S
April 6, 2016 a.
Mr. Norton N. Bonaparte Jr.
City Manager
Mana •
g
City of Sanford
Post Office Box 1788
Sanford, Florida 32772 -1788
Re: City of Sanford Police Officers' Retirement System
Dear Mr. Bonaparte Jr.,:
APR 1 1 2016
In response to Scott Christiansen's request dated March 23, 2016, we have reviewed the proposed
Ordinance (identified on page 17 as dm/san/pol/03- 23- 16.ord), including, but not limited to the following
proposed changes:
1) Section 66 -31, Definitions, is being amended for IRC changes and requirements.
2) Section 66 -36, Benefit amounts and eligibility, subsection (a), Normal Retirement, is being
amended to change the Normal Retirement Date to include IRC required language regarding
Normal Retirement Age and Normal Retirement date.
3) Section 66 -36, subsection (d), Disability, is being amended to more clearly identify those
individuals who may be eligible to apply for a disability pension who have been terminated by the
City due to medical reasons. This section is also amended to provide that if a disabled member is
reemployed as a police officer either with the City of another municipal, county, or State law
enforcement department, he shall be deemed to have recovered from his disability.
4) Section 66 -37, Optional Forms of Benefits, has been amended to:
a. Amend the optional form of benefit known as a partial lump sum option (PLOP), to
clarify that the percentage chosen is calculated as a percent of the total actuarial
equivalent value of the member's benefit.
b. Amend subsection (2) to clarify that if proof of good health of a joint pensioner who is
being replaced is not provided, the actuary will assume that the joint pensioner is
deceased for purposes of calculating the revised benefit amount.
5) Section 66 -46, Deferred Retirement Option Plan, is being amended in accordance with recent
direction from the IRS in connection with the issuance of several recent Favorable Determination
Letters to: i) clarify investment returns on DROP accounts, ii) clarify when interest and earnings
are calculated and paid, and iii) add several sections clarifying the DROP provisions as required
by the IRS.
13420 Parker Commons Blvd., Suite 104 Fort Myers, Fl. 33912 • (239) 433 -5500 - Fax (239) 481 -0634 • www.foster- fosfer.com
Mr. Norton N. Bonaparte Jr.
April 6, 2016
Page 2
We have determined that the adoption of these changes will have no impact on the assumptions used in
determining the funding requirements to the program. Because the changes do not result in a change in
the valuation results, it is our opinion that a formal Actuarial Impact Statement is not required in support
of its adoption. However, since the Division of Retirement must be aware of the current provisions of all
public pension programs, it is recommended that you send a copy of this letter and a copy of the fully
executed Ordinance to each of the following offices:
Mr. Keith Brinkman
Bureau of Local Retirement Systems
Division of Retirement
P. O. Box 9000
Tallahassee, FL 32315 -9000
If you have any questions, please let me know.
Sincerely,
Patrick T. Donlan, ASA, EA, MAAA
cc: Scott Christiansen, Board Attorney
Ms. Sarah Carr
Municipal Police and Fire
Pension Trust Funds
Division of Retirement
P.O. Box 3010
Tallahassee, FL 32315 -3010