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HomeMy WebLinkAboutVI (B) Discussion/Action re: Sgt. William Walker's Retirement AGENDA 9-5-95 / "CENTER OF GOOD LIVING-PRIDE OF WEST ORANGE" Item VI B OcoeeDLL/11 v�N.izi.�,i.ii. (r4inf COMMISSIONERS ti. 4:&._ CITY OF OCOEE RUSTY JOHNSON PAUL W.FOSTER 4. C; O 150 N.LAKESHORE DRIVE SCOTT A.GLASS f►� � �C� OCOEE,FLORIDA 34761-2258 JIM GLEASON (407)656 2322 yJ� �� CITY M ANAGER Of G00V MEMORANDUM ELLIS SHAPIRO TO: The Honorable Mayor and Board of City Commissioners FROM: Ellis Shapiro, City Manager DATE: August 31, 1995 RE: RETIREMENT TRUST FUND - WILLIAM WALKER In 1994 under Ordinance No. 94-07, the City Commission passed a Retirement Incentive Window that was utilized by then Chief Boyd to have an early retirement. Since that ordinance and earlier this year, it became apparent that another individual within the Police Department - Sergeant William S. Walker, Jr. - had not reported 5 years of additional service to the City that he had performed as a police officer earlier in his career. These 5 years made him eligible for the Early Retirement Window as established in Ordinance No. 94-07, and therefore, has the right to retire under the same incentive as Chief Boyd. Attached you will find a copy of a memorandum from our City Attorney advising me of his lawful right to do so. Also included is a letter from Foster at Foster, the actuarial for the Police Officers' and Firefighters' Retirement Trust Fund that explains what the costs associated with William Walker's request for retirement would be. While the total expense is $52,000, $40,000 of that expense would be incurred by the City as a result of the 5 years that Mr. Walker proved he worked at a prior time. $12,000 would be the number of dollars that would have to be funded if Mr. Walker retired early. The additional liability will be funded within the next 8-9 years with interest at the rate of $8,100/year. It is the City's recommendation that the City Commission find that Sgt. William S. Walker, Jr. was not properly notified of his retirement eligibility under the City Police and Firefighters Pension Plan and is therefore deemed to be an "Eligible Member" who may elect to retire and receive an unreduced benefit under the Retirement Incentive Window established by Ordinance No. 94-07 nothwithstanding his failure to notify the City of his election to do so prior to September 30, 1994. Respectfully S 'misted, ES4:fdg:49 Attachments - ester Foster . Inc TEL : 1-8i�-401-0634 Aug 9+ . a5 1,4 :22 No .002 F .01 FOSTER & FOSTER, INC. TgetigatialeMd Vapitero agolta 6201 PRESIDENTIAL COURT,S.W..SUITE 203 FORT MYERS,FLORIDA 33919TELEPFACSIMILE 194114 3.55ONE 19411481-0634 19411433.3500 August 28, 1995 VIA FAx Mr. Ellis Shapiro, City Manager City of Ocoee 150 North Lakeshore Avenue Ocoee, FL 34761 Re: Police Officers' and Firefighters' Retirement Trust Fund (William Walker) Dear Ellis: In response to our telephone discussion today, we are writing to advise that the referenced employee's additional service credits and his resulting participation in the Early Retirement Incentive Program has had the effect of increasing total Plan liabilities by approximately $52,000. Of this amount, approximately $40,000 is attributable to the additional service credits and $12,000 is due to the enhanced benefits provided by the incentive. The additional annual required City contribution which is needed to fund this increased liability is $8,100, or 0.4% of the Total Annual Payroll of covered members. With interest, this addition- al liability will be funded in the next 8 to 9 years. If you have any questions concerning this matter, please let me know. Sincerely, Ward V. Foster, Jr. WVF/ksb cc: Mike Reed, Chairman Post-Ir Fax Note 7671 o.m 3 *Migee*1 Tb tAUL;A ca _iS\4t s.1 C0' crab A 4.r F" ‘k0rk W Sk . O C Rm. .+..ter•... ,_. FOLEY & LARDNER III NORTH ORANGE AVENUE. SUITE 1800 ORLANDO. FLORIDA 32901 TELEPHONE 14071 423.76,86 FACSIMILE 14071 84a-1743 TAMPA. FLORIDA MAILING ADDRESS: MILwAUKEE.WISCONSIN JACKSONVILLE. FLORIDA POST erne!: BOX Z193 MADISON WISCONSIN TALLAHASSEE. FLORIDA WASHINGTON. DC. WEST PALM BEACH. FLORIDA ORLANDO. FL. 321102-2193 ANNAPOLIS. MARYLAND CHICAGO. ILLINOIS MEMORANDUM TO: Ellis Shapiro, City Manager Peggy Psaledakis, Director of Personnel FROM: Paul E. Rosenthal, Esq. , City Attorneyla._ DATE: August 29, 1995 RE: Sgt. Walker's Early Retirement Attached is a draft memorandum regarding the above matter. Please review and provide me with your comments. The staff report to the City Commission may want to include the fiscal impact of Sgt. Walker's early retirement. PER:dh Enclosure CAWPSI s+ sln>memlIPERA i tr. sf— 1 �LAf ttt ^/. 1 rt MEMORANDUM TO: Ellis Shapiro, City Manager FROM: Paul E. Rosenthal, Esq. , City Attorney DATE: August 29, 1995 RE: Retirement Reaueet of Sgt. William e. walker, Jr. This Memorandum is in response to your request that we review the retirement request of Sgt. William S. Walker, Jr. (copy attached) and advise you whether he is eligible to retire under the Retirement Incentive Window enacted under Ordinance No. 94-07 for police officers and firefighters. For the reasons set forth below, it is our opinion that Sgt. Walker is now entitled to take an early retirement with the benefit of the Retirement Incentive Window, though the City may have arguments which could be used to deny such a request. FACTS: The City Commission adopted ordinance No. 94-07 on April 19, 1994 (the "Ordinance") . The Ordinance permitted police officers who had reached age 46 and had 23 or more years of Credited Service under the City Police and Firefighters Pension Plan ("the Plan") to take an unreduced benefit under an early retirement window ("the Window") . In order to qualify for the Window, a potentially eligible officer had to notify the City of his intent to take early retirement prior to September 30, 1994. According to FDLE records, Sgt. Walker was employed by the City from October 196B to August 1973. He then had a break in service and was subsequently re-employed by the City. The City records have not included Sgt. Walker's initial service with the city. This initial service should have been calculated in determining Sgt. Walker's length of service. Due to a break in Sgt. Walker's service with the Ocoee Police Department and incomplete City records, the City did not know of Sgt. Walker's potential eligibility for the Window and, therefore, did not provide personal notice to Sgt. Walker. He has now become aware of his potential eligibility and provided notice of his intent to retire and asked for benefits to which he would have been entitled under the Window. Apparently, Sgt. Walker does not intend to presently retire if the benefits of the Window are not provided. In the past, the City has provided to each of its employees, including Sgt. Walker, records of the employee's prior service. Sgt. Walker had not previously advised the city of the error in its records of his service. As a result, the City had inaccurate information regarding his length of service at the time of adoption of the Ordinance. DISCUSSION: The City had a legal obligation to notify sqt. Walker of his eligibility for the Window. Under Section 3(5) (S) of the Plan, the Board of Trustees has a duty "to distribute to participants, at regular intervals, information concerning the (Plan) ." The Plan is treated as a contract between the City and the Plan Participants. Therefore, Sgt. Walker could argue that a failure to provide information concerning the Plan would constitute a breach of the City's contractual obligation under the Plan. It is clear that the City did not give Sgt. Walker personal notice of his eligibility for the window since the City had inaccurate information regarding his length of service. It also appears that Sgt. Walker was not aware of his eligibility since, at the time, he did not know that his initial service should be counted towards his length of service under the Plan. While the City may argue that it satisfied its obligation to notify Sgt. Walker of his eligibility for the Window because of a presumption that individuals have knowledge of the law, our research did not produce any cases in which an employee attempted to use his lack of knowledge of the law to make a claim for benefits against his employer. It would appear that Sgt. Walker could rebut any such contention by pointing to the express language of the• Plan and state that it clearly indicates that individualized notice is intended. Further, he may analogize to a traditional trust and argue that the Trustees of the Plan owe him, as a beneficiary, the fiduciary duty of keeping accurate track of his length of service and notifying him of the benefits to which he is entitled under the Plan. The City could also argue that Sgt. Walker should be estopped from claiming benefits under the Window because he did not notify the City of its error. As a consequence, the City could not plan for the additional expense associated with his early retirement under the Window. Our review of the applicable case law indicates that it would be difficult for the City to successfully argue that Sgt. Walker is estopped from claiming benefits under the Window. -2- Ani it n A rA1 vv *AVIS, .e •....n• „� ,.s_.. - - - - - In addition, Scott Christensen, attorney to the Trustees, has indicated that he believes that possible arguments may exist under the due process and equal protection clauses of the Constitution which would support Sgt. Walker's claim for benefits under the Window. CONCLUSION: Based on the circumstances set forth above, it is our opinion that Sgt. William S. Walker, Jr. is entitled to early retirement with the benefits of the Window notwithstanding his failure to elect to receive such benefits and retire on or before September 30, 1994. This opinion is limited to circumstances in which the City records inaccurately reflect the length of service of an employee and therefore failed to notify the employee of his eligibility to take an early retirement with the benefits provided by the Window. RECOMMENDATION: It is recommended that this matter be placed on'an agenda for consideration by the City Commission. It is further recommended that the City Commission find that Sgt. William S. Walker, Jr. was not properly notified of his retirement eligibility under the City Police and Firefighters Pension Plan and is therefore deemed to be an "Eligible Member" who may elect to retire and receive an unreduced benefit under the Retirement Incentive Window established by Ordinance No. 94-07 notwithstanding his failure to notify the City of his election to do so prior to September 30, 1994. cc: Ms. Peggy Psaledakis Scott Christensen, Esq. -3- snn:snn lit Y?ATmz rT 11 TaTA3 AL IT ALA .