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4417 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.