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HomeMy WebLinkAboutCity of Tamarac Ordinance O-2003-0011 1 Temp. Ord. #1994 12/18/02 Page 1 CITY OF TAMARAC, FLORIDA IQ61111101/_1►[N=1►[O1 1 P41111 11I AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF TAMARAC, FLORIDA; AMENDING CHAPTER 16, ENTITLED "PENSIONS AND RETIREMENT", ARTICLE Vlll, DIVISION 4, ENTITLED "BENEFITS" TO PROVIDE ADJUSTMENTS FOR NORMAL RETIREMENT BENEFITS; PROVIDING ADJUSTMENTS FOR EARLY RETIREMENT BENEFITS; PROVIDING ADJUSTMENTS FOR PRE - RETIREMENT DEATH BENEFITS PURSUANT TO AMENDMENTS OF CHAPTER 185 OF THE FLORIDA STATUTES; PROVIDING FOR CODIFICATION; PROVIDING FOR CONFLICTS; PROVIDING FOR SEVERABILITY; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the Florida Legislature adopted amendments to Chapter 185 of the Florida Statutes regarding Police Officers' Pension Trust Funds; and WHEREAS, these amendments require municipalities to provide minimum benefits in accordance with Florida law upon receipt of premium tax revenues in addition to those received by the City in the "base" year as defined by Florida State Statute for this purpose (revenues received in 1998 for calendar year 1997); and WHEREAS, the City of Tamarac received additional premium tax revenues in 2002 requiring that those revenues be used to provide minimum benefits as defined in Chapter 185, State Statutes; and CODING: Words in c+"--^'- tthrna-ug4 are deletions form existing law; Words in underscored type are additions. Temp. Ord. #1994 12/ 18/02 Page 2 WHEREAS, the Police Officers' Pension Trust Fund approved the proposed changes on December 20, 2002 as noted on attached Exhibit 1; and WHEREAS, the City of Tamarac, Florida desires to maintain compliance with Chapter 185 of the Florida Statutes; and WHEREAS, the City Commission has received and reviewed an actuarial impact statement related to this change attached as Exhibit 2; and WHEREAS, the City of Tamarac, Florida hereby amends its Police Officers' Pension Trust Fund to provide such benefits as follows: NOW THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF TAMARAC, FLORIDA: Section 1: Section 16-718 of Chapter 16, Pensions and Retirement, Article VIII, Division 4, Benefits of the Code of Ordinances is hereby amended as follows: The early retirement benefit shall be the benefit level provided in section 16-734 et seq. reduced by one }hir}ia}" fnr o�nh of }ho nov4 fIVO voactuarially to take into _account the participant's younger ,age and the earlier commencement of retirement income payment. In no event shall the earl retirement reduction exceed three (3) percent for each year by which the participant is younger than the normal retirement age for the participant on the effective date of his/her early retirement. Section 2: Section 16-719 of Chapter 16, Pensions and Retirement, Article VIII, Division 4, Benefits of the Code of Ordinances is hereby amended as follows: CODING: Words in ss}r--rk }"ro, are deletions from existing law; Words in underscored type are additions. Temp. Ord. #1994 12/18/02 Page 3 The normal retirement age shall be the first day of the month on or after which the participant attains twenty- five 25 vesting credits and fifty-two 52 ears of age; or ten (10) vesting credits and fifty-five (55) years of age�or five (5) vesting credits and fifty-seven years of age. Section 3: Section 16-741 of Chapter 16, Pensions and Retirement, Article Vill, Division 4, Benefits of the Code of Ordinances is hereby amended as follows: (b) The amount of the survivor benefit shall be equal to fifty (45G) one hundred (100) percent of the actuarially equivalent single sum value of the participant's vested accrued benefit as of his date of death or, of the equivalent single sum value of the amount the designated beneficiary could have received had the participant retired on the day of death and elected a one hundred (100) percent joint and survivor annuity, whichever is greater. If this single sum amount is less than twenty-five hundred dollars ($2,500.00), it shall be paid in a lump sum to the spouse or designated beneficiary, as the case may be, as soon as is practicable following the participant's death. If the single sum amount exceeds twenty-five hundred dollars (2,500.00), the benefit shall be paid in the form of an immediate monthly survivor annuity unless the beneficiary and the board agree to an alternative actuarially equivalent form of benefit. Section 4: It is the intention of the City Commission and it is hereby ordained that the provisions of this Ordinance shall become and be made a part of the Code of Ordinances of the City of Tamarac, Florida, and that the Sections of this Ordinance may be renumbered, relettered and the word "Ordinance" may be changed to "Section", "Article" or such other word or phrase in order to accomplish such intention. CODING: Words in StF Gk thFe6@# are deletions from existing law; Words in underscored type are additions. Temp. Ord. #1994 12/18/02 Page 4 Section 5: All Ordinances or parts of Ordinances, and all Resolutions or parts of Resolutions in conflict herewith are hereby repealed to the extent of such conflict. Section 6: If any provision of this Ordinance or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Ordinance that can be given affect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. Section 7: This Ordinance shall take effect on adoption. PASSED, FIRST READING this 81" day of January, 2003. PASSED, SECOND READING this 22nd day of January, 2003. JOE SCHRIEBER MAYOR ATTEST: RECORD OF COMMISSION VOTE: MARION SWENSON, CMC MAYOR SCHREIBER CITY CLERK DIST 1: V/M. PORTNER DIST 2: COMM. MISHKIN DIST 3: COMM. SULTANO .� DIST 4: COMM. ROBERTS I HEREBY CERTIFY that I have approved this ORDINANCE as to form. G M TCH'ELL S. KRAFT W L/ ITY ATTORNEY CODING: Words in stri-ok thr^� ^" are deletions from existing law; Words in underscored type are additions. EXHIBIT 1 do Benefits USA, hic. CITY O F T A M A R A C POLICE Laud Boulevard, Lauderhillchill,, FL FL 33319 Suite 208 OFFICERS' PENSION TRUST rr;! FUND (954) 730-2068 (800) 452-2454 (954) 730-0738 Fax December 20, 2002 O C © _-0 C'7 Ms. Maria Swanson mm r"n O A City of Tamarac w 7525 NW 88 h Avenue o m Tamarac, FL 33321 '"" CO RE: CITY OF TAMARAC POLICE OFFICERS' PENSION TRUST FUND Dear Ms. Swanson: Please be advised that this Ordinance was approved by the Board of Trustees of the City of Tamarac Police Officers' Pension Trust Fund meeting of December 20, 2002. Enclosed please find two letters from the Actuary regarding the actuarial impact statement which must be sent to Charles Slavin and Patricia Shoemaker at the Division of Retirement in Tallahassee. If you have any questions, please do not hesitate to give me a call. Sincerely, 6 4 ..lZ 1 ` Pete Prior Fund Administrator uec 1 H U2 Q 1 : 2Up ]Kxhi_i)i-t GABRIEL, ROEDER, SMITH & COMPANY Consultants t& Actuaries November 22, 2002 301 East Las Olas Blvd. • Suite 200 • Ft. Lauderdale, FL 33301-2254 •954-527-1616 • FAX 954-525-0083 Mr. Charles Slavin, Actuary Bureau of Program Services Division of Retirement Cedars Executive Center, Bldg. C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Re: Tamarac Police Officers' Pension Trust Fund Actuarial Impact Statement Dear Mr. Slavin: Enclosed is a copy of Ordinance No, amending the above -captioned retirement plan. This letter, with enclosures, constitutes the Statement of Actuarial Impact as issued by the plan administrator. The ordinance provides for the following: 1. The early retirement reduction not to excesd 3% per year early. 2. The pre -retirement death benefit is the accrued benefit, payable at normal retirement date. 3. The Normal Retirement Date is age 57 with 5 years of service, age 55 with 10 years of service, or age 52 with 25 years of service. Details relating; to the impact on the cost of the Plan are attached. Prior to the October 1, 2000 valuation, the entry age actuarial cost method was used. The method included a past service liability, amortized into the future. The ongoing source of funding for that liability was premium tax moony from the State. For the October 1, 2000 valuation, the cost method was changed to accelerate funding, due to the Stab* position at that time indicating that the premium tax money would no longer be available after the last active plan member retired. However, earlier this year, the State has resumed it's previous position. — that plans would continue receiving premium tax money as long as there are any remaining members, active or retired, and as long as the plans are not fully funded. hi light of the above, we have resumed use of the entry age actuarial cost method as of October 1, 2000, using those results from the valuation, report of that date as our valuation results for purposes of this study. The cost d.etennination was prepared and completed by me or under my direct supervision, and 1 acknowledge responsibility for the results. To the best of my knowledge, the results are complete and u. accurate, and in my opinion, the techniques and assumptions used are reasonable and meet the requirements and intuit of Pail VII, Chapter 112, I' lorida Statues. There is no benefit or expense to be Dec 18 02 01:21p p.4 November 22, 2002 Mr. Charles Slavin Page 2 provided by the plan wid/or paid from the plan's assets for which liabilities or cuirent cost have not been established or otherwise taken into account in the cost determination. All known events or trends, which may require a material increase in plan costs or required contribution rates have been taken into account in the cost. determination. Theora P. Braccialarghe, FSA, MAAA, FCA Date Enrolled Actuary #t02-•2826 OL For the Pension Boardas Date Plan Administrator GABRIEL ROEDER, SMITH & COMPANY ,flee 18 02 01:21p p.5 GABRIEL ROEDER, SMITH & COMPANY Consultants & Ac#uarias 301 East Las Olas Blvd, • Suite 200 a Ft. Lauderdale, FL 33301-2254 a 954-527-1616 • FAX 954-525-0083 November 22, 2002 Ms. Patricia Shoemaker Bureau of Municipal Police Officers & Firefighters Retirement Fund P.O. Box 3010 Tallahassee, Florida 32315-3010 Re: Tamarac Police Officers' Pension Trust Fund Actuarial Impact Statement Dear Ms. Shoemaker_ Enclosed is a copy of Ordinance No. amending the above -captioned retirement plan- This letter, with enclosures, constitutes the Statement of Actuarial Impact as issued by the plan administrator. The ordinance provides for the following: 1. The early retimment reduction not to exceed 3% per year early. 2. The pre -retirement death benefit is the accrued benefit, payable at normal retirement date. 3. The Normal Retirement Date is age 57 with 5 yews of service, age 55 with 10 years of service, or age .52 with 25 years of service. Details relating to the impact on the cost of the Platt are attached. Prior to the October 1, 2000 valuation, the entry age actuarial cost method was used. The method included a past service liability, amortized into the future- The ongoing source of funding for that liability was premium tax money from the State. For the October 1, 2000 valuation, the cost method was changed to accelerate funding, due to the State position at that time indicating that the premium tax money would no longer be available after the last active plan member retired. However, earlier this year, the State has resumed it's previous position -- that plans would continue receiving premium tax money as long as there are any retraining members, active or retired, and as long as the plans are not fully funded. In light of the above, we have resurned use of the entry age actuarial cost method as of October 1, 2000, using those results from the valuation report of that date as our valuation results for purposes of this study. The cost determination was prepared and completed by me or under my direct supervision, and I acknowledge responsibility for the results. To the best of my knowledge, the results are complete and accurate, and in my opinion, the techniques and assumptions used are reasonable and meet the requirements and intent of Part VII, Chapter 112, Florida Statues. There is no benefit or expense to be Dec 18 02 01:21p p.6 November 22, 2002 Ms. Patricia Shoemaker Page 2 provided by the plan and/or paid from the plan's assets for which liabilities or current cost have not been established or otherwise taken into account in the cost determination. All known events or trends, which may require a .material. increase in plan costs or required contribution rates have been taken into account in the cost determination. Theora P. Braceialarghe, FSA, MAAA, FCA Date Enrolled Actuary #02-.2826 For the Pension Boar as Date Plan Administrator GABRIEL ROEDER. SMITH ak COMPANY POLICE OFFICERS COMPARATIVE SUMMARY OF VALUATIONRESULTS AS OF OCTOBER 1 2000 Impact Valuation Covered,'Grou A. Number of Participants Actives 7 7 Retirees, Disabilities, Beneficiaries and Vested Terminations 40 40 Total Annual Covered Payroll $559,935 $565,697 Payroll Under Normal Retirement A e $377,147 $465,239 Lon 'Ran a Cost B. Actuarial Present Value of Projected Benefits 10,797,491 10,941,026 C. Actuarial Present Value of Future Normal Costs 345,572 590,986 D. Actuarial Accrued Liability (AAL): B - C 10,451,919 10,350,040 E. Valuation Assets 10,239,493 10,239,493 F. Unfunded Actuarial Liability (UAAL): D - E 212,426 110,547 Ca rrent Cast G. Payment Required to Amortize UAAL (2,336) (10,537) As % of Payroll (0.62)% (2.26)% H. Employer Normal Cost (for current year, exclusive of funding toward UAAL) 97,367 111,017 As % of Payroll 25.82% 23.86% I. Fiscal Year to which Contributions Apply NA NA J. Total Required City and State Contributions if paid monthly during the fiscal year in (1) above 98,883 104,553 As % of Payroll 26.22% 22.47% K. Estimate of Available State Premium Tax Refund 185,657 185,657 As %of Payroll 49.23% 39.91% L. Balance Required from CityBSO 0 0 As % of Payroll 0.00% 0.00% F POLICE OFFICI DERIVATION OF NOW A.Entry Age Normal Costs for Benefits I. Service Retirement Benefits 2. Vesting Benefits 3. Disability Benefits 4. Preretirement Death Benefits 5. Return of Contributions 6. Total B.Normal Cost for Administrative Expense C.Expected Member Contributicns D.Employer Normal Costs for Pian Year Beginning October 1: (A) + (B) - (C) PRES] A. Present Value of Future Saiaries B. Present Value of Projected Benefits 1. Active Members a. Service Retirement Benefits b. Vesting Benefits c. Disability Benefits d. Preretirement Death B:anefirs e. Return of Contributions f. Total 2, Inactive Members a. Service Retirees b. Disability Retirees c. Benefi-,ianes d. Terminated Vested e. Total 3. Grand Total 2000 $69,687 $80,256 7,248 9,363 11,545 15,924 1,675 2,672 80 75 90,235 108,290 25,990 1 25,990 18,858 23,263 97,367 1 111,017 Impact 2000 $1,476,100 $2,616,200 3,259,825 3,240,305 65,045 127,087 90,475 163,965 27,727 55,250 0 0 3,443,072 3,586,607 4,474,707 4,474,707 2,220,682 2,220,682 301,085 301,085 357,945 357,945 7,354,419 7,354,419 10,797,491 10,941,026 .V LIQU%CiATION OF THE UNFUNDED ACTUARIAL ACCRUED LIABILITY The Unfunded Actuarial Accrued Liability (UAAL) is being amortized as a level dollar amount over the number of years remaining in the amortization period. Details relating to the UAAL are as follows: 3 Original Current Amortization Years Date Period Amount Remaining Amount Payment 10/1/89 20 Years $844,493 9 $ 277,148 $ 40,748 10/1/93 20 Years 93,385 13 43,848 5,078 10/1/94 20 Yews (249,676) 14 (124,870) (13,853) 10/1/96 30 Years 1,657,389 26 1,154,170 96,934 10/1/97 15 Years, (170,976) 12 (96,068) (11,678) 10/1/98 Gain 15 Years (829,479) 13 (521,408) (60,385) 10/1/99 Gain I 15 Years (100,661) 14 (80,973) (8,983) 10/1/99 Assumption Change 30 Years 26,980 29 23,516 1,911 10/1/00 Gain ' 15 Years 564,816 15 (564,816) (60,309) 10/1/00 Amendment 30 Years 101,879 30 101,879 8,201 212,426 2 336 Schedule IIlustratin the Ex ected Amortization of the'i1AA Year Projected UAAL 2000 $212,426 2001 231,408 2002 1 251,860 2003 273,898 2004 297,644 2009 447,001 2014 834,487 2619 626,300 2024 236,335 2029 8,201 2030 _ 0