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HomeMy WebLinkAboutItem 11 Second Reading of Ordinance Amending the City of Ocoee Municipal Police Officers’ & Firefighters’ Retirement Trust Fund Reflecting Internal Revenue Code (IRC) Changes and CBA Revisions from Previous Years ocoee florlda AGENDA ITEM COVER SHEET Meeting Date: January 7, 2020 Item # / I Reviewed By: Contact Name: Charles J. Brown Department Director: Chief C n Chairperson P&F RPB ,�r Contact Number: City Manager: Robert Fr. "47���/'� Subject: Second Reading of Ordinance Amending the City of Ocoee Municipal Police Officers' & Firefighters' Retirement Trust Fund Reflecting Internal Revenue Code (IRC) Changes and CBA Revisions for Previous Years Background Summary: The City of Ocoee Municipal Police Officers' & Firefighters' Pension Board has reviewed and approved the proposed ordinance which deals primarily with definition changes for compliance with the Internal Revenue Code and changes agreed upon in collective bargaining agreements with the City of Ocoee and the respective bargaining units from the police and fire departments. The proposed amendments are as follows: Section 1, Definitions, clarify and the definition of"credited service" Section 7 & 8, Pre-Retirement Death and Disability, amended to more clearly identify those individuals who may be eligible to apply for a disability pension in the event that they have resigned or their employment is terminated. Section 9, Vesting, clarifying the rights of vested and non-vested employees who terminate service prior to retirement. Section 15, Maximum Pension, the limitation mirrors the language in the Internal Revenue Code. Section 17, Miscellaneous Provisions, Missing Benefit Recipients. This provision is in accordance to IRS Programs Compliance Memorandum. Section 27, Deferred Retirement Option Plan, clarifying that once a member participates in the DROP program, no changes to his/her form of benefit is permitted. Section 29, Reemployment After Retirement, amended as required by IRC. Section 30, Supplemental Benefit Component for Special Benefits, amended to provide that a member who has less than seven years of Credited Service and terminates service with the City shall forfeit his individual Member Share Account. Issue: Should the Honorable Mayor and City Commissioners adopt an Ordinance amending the City of Ocoee Police Officers' & Firefighters' Retirement Trust Fund with revisions complying with the IRC and clarifying previously agreed upon revisions made through collective bargaining? Recommendations: In order to be compliant with changes to the Internal Revenue Code (IRC) and its associated regulations and to clarify all changes made through police and fire bargaining agreements, the Police Officers' & Firefighters' Retirement Board formally requests that the attached Ordinance be adopted by the City Commission. Attachments: • Sugarman & Susskind, P.A. Letter • Ordinance • Foster & Foster, Actuarial Impact Statement December 17, 2019 Financial Impact: Douglas Lozen of Foster & Foster, Statement of Impact attached. Impact statement projects city contribution less than .1% of annual payroll as financial impact. Type of Item: (please mark with an "x") Public Hearing For Clerk's Dept Use: Ordinance First Reading Consent Agenda X Ordinance Second Reading Public Hearing Resolution Regular Agenda Commission Approval Discussion& Direction X Original Document/Contract Attached for Execution by City Clerk Original Document/Contract Held by Department for Execution Reviewed by City Attorney N/A Reviewed by Finance Dept. N/A Reviewed by Pension Attorney David Robinson N/A 2 SUGARMAN & SUSSKIND PROFESSIONAL ASSOCIATION ATTORNEYS AT LAW Robert A.Sugarman* 100 Miracle Mile Howard S.Susskind Suite 300 Kenneth R.Harrison,Sr. Coral Gables, Florida 33134 D.Marcus Braswell,Jr. (305)529-2801 Pedro A.Herrera Broward 327-2878 David Robinson Toll Free 1-800-329-2122 Ivelisse Berio LeBeau Facsimile(305) 447-8115 ♦Board Certified Labor &Employment Lawyer November 27, 2019 Via Email: livia(ZI benefIts-usa.org Board of Trustees City of Ocoee Municipal General Employees' Retirement Trust Fund c/o Livia Giuliani, Plan Administrator Benefits USA, Inc. 3810 Inverrary Boulevard Suite 303 Lauderhill, FL 33319 Re: City of Ocoee Police & Firefighters'Retirement Trust Fund Proposed Ordinance Amendment Dear Trustees: As previously discussed with the Board, enclosed please find a proposed ordinance amending the City of Ocoee Municipal Police&Firefighters' Retirement Trust Fund. The purpose of the amendment is to clarify language in certain provisions of the plan, and to update the plan to reflect recent guidance of the Internal Revenue Service. Specifically, the following amendments to the pension plan are proposed: 1. Section 1,Definitions,amending the definition of Credited Service to include language referring to the terms articulated in Section 8, Vesting, referencing the language regarding the rights of employees who terminate service prior to retirement. 2. Sections 7 and 8, Pre-Retirement Death and Disability,is being amended to more clearly identify those individuals who may be eligible to apply for a disability pension in the event that they have resigned or their employment is terminated.This clarification does not change the way in which this provision has been applied or interpreted in the past. This change is being made because the current language has been challenged in litigation as being unclear and has resulted in unintended application of the language. The recommended change clarifies the language which remains consistent with the intended application and prior administration. Further, language is being included to update the Retirement Trust Fund's governing code to comply with the recent enactment of Ch. 2019-21, Laws of Florida. The new law, effective July 1, 2019, amends F.S. 112 to provide additional disability and death benefits to eligible firefighters who have been Board of Trustees City of Ocoee Police & Firefighters' Retirement Trust Fund c/o Livia Giuliani, Plan Administrator November 27, 2019 Page 12 disabled or died as a result of certain forms of cancer. Specifically,the new law creates a presumption of service-connected disability, or preretirement death, for eligible firefighters who either perish or are found to be totally and permanently disabled from useful and efficient service as a firefighter, based on at least one of 21 enumerated forms of cancer or circumstances that arise out of the treatment of such cancer. 3. Section 9, Vesting, is being amended to clarify the rights of vested and non-vested employees who terminate service prior to retirement. The amendment further articulates the process for such former employees receiving a refund of their accumulated contributions as well as articulating benefits available should such members become reemployed by the City. 4. Section 15, Maximum Pension, is being amended so that the specified limitation mirrors the current language in the Internal Revenue Code applicable to qualified plans. 5. Section 17,Miscellaneous Provisions,is being amended to add a subsection 9.,Missing Benefit Recipients. This provision is being included in accordance with a recent IRS Programs Compliance Memorandum. 6. Section 27, Deferred Retirement Option Plan, is being amended to clarify that once a member commences participation in the DROP no changes to his or her form of benefit are permitted. Further, the language is being amended to clarify that, in accordance with Ordinance 2018-046, the DROP accounts of members whose participation in the DROP commenced on or after September 18, 2012 will be credited on a monthly basis which is the same manner as currently employed for DROP participants who entered DROP prior to that date. 7. Section 29, Reemployment After Retirement, is being amended to make several changes as required by the Internal Revenue Code to satisfy the qualification requirements applicable to the reemployment of a disability retiree. 8. Section 30, Supplemental Benefit Component for Special Benefits; Chapter 175 and 185 Share Accounts, is being amended to provide that a member who has less than seven years of Credited Service and terminates service with the City shall forfeit his individual Member Share Account. Please do not hesitate to reach out to us should you require any additional information. E. ROB • DER/jd Enclosure ORDINANCE NO. 2020 - AN ORDINANCE OF THE CITY OF OCOEE, FLORIDA, RELATING TO THE CITY OF OCOEE MUNICIPAL POLICE OFFICERS' AND FIREFIGHTERS' RETIREMENT TRUST FUND; AMENDING ORDINANCE NUMBER 2010-019, AS SUBSEQUENTLY AMENDED; AMENDING SECTION 1, DEFINITIONS, BY AMENDING THE DEFINITION OF "CREDITED SERVICE"; AMENDING SECTION 7, PRE-RETIREMENT DEATH; AMENDING SECTION 8, DISABILITY; AMENDING SECTION 9, VESTING; AMENDING SECTION 15, MAXIMUM PENSION; AMENDING SECTION 17, MISCELLANEOUS PROVISIONS; AMENDING SECTION 27, DEFERRED RETIREMENT OPTION PLAN; AMENDING SECTION 28, REEMPLOYMENT AFTER RETIREMENT; AMENDING SECTION 30, SUPPLEMENTAL BENEFIT COMPONENT FOR SPECIAL BENEFITS, CHAPTERS 175 AND 185 SHARE ACCOUNTS; PROVIDING FOR SEVERABILITY OF PROVISIONS; REPEALING ALL ORDINANCES IN CONFLICT HEREWITH AND PROVIDING AN EFFECTIVE DATE. SECTION 1. Authority. The City Commission of the City of Ocoee has the authority to adopt this ordinance pursuant to Article VIII of the Constitution of the State of Florida and Chapter 166, Florida Statutes. SECTION 2. That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 1, Definitions, by amending the definition of"Credited Service" to read as follows: SECTION 1. — DEFINITIONS. Credited Service means the total number of years and fractional parts of years of service as a Police Officer or Firefighter 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 or Firefighter. The rights to credited service under the System of any Member who leaves the employ of the Police or Fire Department for any cause other than death or retirement prior to satisfying the requirements for Early or Normal Retirement, shall be determined in accordance with Section 9 hereof. A Member may—voluntarily leave his or her Accumulated 1 •. • - ■_ _ reemployed as a Police Officer or Firefighter, without losing credit for the time that he or she was a Member of the System. If a vested Member leaves the employ of the Police or Fire Department, his or her Accumulated Contributions will be returned upon his or her written request. If a Member --• •- ' a • • - - • - _ - ... . . the lump sum amount designated by the Board. Upon return of a Member's Accumulated Contributions, all of his or her rights and benefits under the System are forfeited and terminated. Upon any reemployment, a Police Officer or a Firefighter 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 or interest, as determined by the Board, within ninety (90) days after his reemployment. SECTION 3. That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 8, Disability, subsection 1, Disability Benefits In-Line of Duty, subparagraph A.(1), (2) and (3) and B.(1) and (2); subsection 3, Disability Benefits Not-In-Line of Duty, subparagraph A.(1) and (2) and B.(1) and (2); and adding subsection 8., Eligibility for Disability Benefits, to read as follows: SECTION 8. - DISABILITY. 1. Disability Benefits In-Line of Duty. A. Firefighter Members. (1) Any Member hired prior to October 1, 2015 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 Firefighter, which disability was directly caused by the performance of his or her duty as a Firefighter, shall, upon establishing the same to the satisfaction of the Board, be entitled to a monthly pension equal to three and one-half percent (3.5%) of his or her Average Final Compensation 2 multiplied by the total years of Credited Service, up to a maximum benefit not to exceed ninety-one percent (91%) of Average Final Compensation of the Member hired on or after October 1, 2012, but in any event the minimum amount paid to the Member shall be forty- two percent (42%) of the Average Final Compensation of the Member. - •• _ -_ _ _ , - .- - -_ _ non vested, are not eligible for disability benefits. • - • - _ . _ , , _ . terminated by the City for medical r ason., hc days from the date of termination. If a timely application-is rcceivcd, it shall be-proec&scd and-thc terminated person shall be eligible to receive a above- Eligibility requirements for disability benefits are set forth in subsection 8., below. (2) Any Member hired on or after October 1, 2015 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 Firefighter, which disability was directly caused by the performance of his or her duty as a Firefighter, shall, upon establishing the same to the satisfaction of the Board, be entitled to a monthly pension equal to three and one quarter percent (3.25%) of his or her Average Final Compensation multiplied by the total years of Credited Service, up to a maximum benefit not to exceed eighty- one and one quarter percent (81.25%) of Average Final Compensation of the Member, but in any event the minimum amount paid to the Member shall be forty- two percent (42%) of the Average Final Compensation of the Member. - •- • _ -_ _- _ , - -- - -_ _ non vested, are not eligible for disability benefits. terminated by the City for medical reasons, the 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 3 above. Eligibility requirements for disability benefits are set forth in subsection 8., below. (3) Firefighter Cancer Presumption. As provided and subject to the limitations in section 112.1816, Florida Statues, effective July 1, 2019, a firefighter (as defined in section 112.1816(1), Florida Statutes) Member shall be considered to be totally and permanently disabled in the line of duty if he or she meets the Plan's definition of Totally and Permanently Disabled due to a diagnosis of cancer (as defined in section 112.1816(1), Florida Statutes) or circumstances that arise out of the treatment of such cancer (as defined in section 112.1816(1), Florida Statutes). B. Police Officer Members. (1) Any Member hired prior to May 16, 2017 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 or her 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 one-half percent (3.5%) of his or her Average Final Compensation multiplied by the total years of Credited Service, up to a maximum benefit not to exceed ninety-one percent (91%) of Average Final Compensation of the Member hired on or after October 1, 2012, but in any event the minimum amount paid to the Member shall be fifty-five percent (55%) of the Average Final Compensation of the Member. Terminated persons, either vested or non vested, are not eligible for disability benefits. terminated by the City for medical r asonc, the days from the date of termination. If a timely terminated person shall be eligible to receive a 4 he is totally and permanently disabled as provided for above. Eligibility requirements for disability benefits are set forth in subsection 8., below. (2) Any Member hired on or after May 16, 2017 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 or her 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 one quarter percent (3.25%) of his or her Average Final Compensation multiplied by the total years of Credited Service, up to a maximum benefit not to exceed eighty- one and one quarter percent(81.25%) of Average Final Compensation of the Member, but in any event the minimum amount paid to the Member shall be fifty-five percent (55%) of the Average Final Compensation of the Member. Terminated persons, eithcr vested or non vested, are not eligible for disability benefits. • . _ _ • terminated by the City for medical rconc, the days from the date of termination. If a timely terminated person shall be eligible to receive a above. Eligibility requirements for disability benefits are set forth in subsection 8., below. 3. Disability Benefits Not-In-Line of Duty. A. Firefighter Members. (1) Any Member hired prior to October 1, 2015 with ten (10) 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 Firefighter, which disability is not 5 directly caused by the performance of his or her duties as a Police Officer or Firefighter shall, upon establishing the same to the satisfaction of the Board, be entitled to a monthly pension equal to three and one-half percent (3.5%) of his or her Average Final Compensation multiplied by the total years of Credited Service, up to a maximum benefit not to exceed ninety- one percent (91%) of Average Final Compensation of the Member hired on or after October 1, 2012. Terminated persons, either vested or non vested, arc previous sentence, if a Member is terminated-by-the City for medical reasons, the terminated person may 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 disabled as provided for above. Eligibility requirements for disability benefits are set forth in subsection 8., below. (2) Any Member hired on or after October 1, 2015 with ten (10) 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 Firefighter, which disability is not directly caused by the performance of his or her duties as a Police Officer or Firefighter shall, upon establishing the same to the satisfaction of the Board, be entitled to a monthly pension equal to three and one quarter percent (3.25%) of his or her Average Final Compensation multiplied by the total years of Credited Service, up to a maximum benefit not to exceed eighty- one and one quarter percent(81.25%) of Average Final Compensation of the Member. 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 Board within thirty (30) days from the date of 6 — — - ' ' • - disabled as provided for above. Eligibility requirements for disability benefits are set forth in subsection 8., below. B. Police Officer Members. (1) Any Member hired prior to May 16, 2017 with ten (10) 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 one-half percent (3.5%) of his or her Average Final Compensation multiplied by the total years of Credited Service, up to a maximum benefit not to exceed ninety-one percent (91%) of Average Final Compensation of the Member hired on or after October 1, 2012. Terminated persons, cithcr vcstcd or non vested, are not eligible for sentence, if a Member is terminated by the City for Board within thirty (30) days from the date of be processed and the terminated person shall be cligible to receivc a disability bcncfit if the Board _ _ _ _ •cc e _ _ _ —. Eligibility requirements for disability benefits are set forth in subsection 8., below. (2) Any Member hired on or after May 16, 2017 with ten (10) 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 7 monthly pension equal to three and one quarter percent (3.25%) of his or her Average Final Compensation multiplied by the total years of Credited Service, up to a maximum benefit not to exceed eighty- one and one quarter percent(81.25%) of Average Final Compensation of the Member. Terminated persons, disability benefits. Notwithstanding the previous sentence, if a Member is terminated by the City for Board within thirty (30) days from the date of eligible to receive a disability benefit if the Board - e _ - _ e _ _ _ _ _ _ _. Eligibility requirements for disability benefits are set forth in subsection 8., below. 8. Eligibility for Disability Benefits_ Subject to 8.(4) below, only active Members of the System on the date the Board determines entitlement to a disability benefit are eligible for disability benefits. (1) Terminated persons, either vested or non-vested, are not eligible for disability benefits. (2) If a Member voluntarily terminates his employment, either before or after filing an application for disability benefits, he is not eligible for disability benefits. (3) If a Member is terminated by the City for any reason other than for medical reasons, either before or after he files an application for disability benefits, he is not eligible for disability benefits. (4) The only exception to (1) above is: a. If the Member is terminated by the City for medical reasons and he has already applied for disability benefits before the medical termination, or; 8 b. If the Member is terminated by the City for medical reasons and he applies within 30 days after the medical termination date. If either (4)a., or (4)b. above applies, the Member's application will be processed and fully considered by the Board. SECTION 4. That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 7, Pre-retirement Death, and adding subsection 4., Firefighter Cancer Presumption, to read as follows SECTION 7. - PRE-RETIREMENT DEATH. 4. Firefighter Cancer Presumption. As provided and subject to the limitations in section 112.1816, Florida Statutes, effective July 1, 2019, a firefighter (as defined in section 112.1816(1), Florida Statutes) Member shall be considered to have died in the line of duty if he or she dies as a result of cancer (as defined in section 112.1816(1), Florida Statutes) or circumstances that arise out of the treatment of such cancer (as defined in section 112.1816(1), Florida Statutes). SECTION 5. That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 9, Vesting, to read as follows: SECTION 9. -VESTING. _ .. _ •. . _ other—benefits under this System, the Member shall be entitled—to—the following 1. For Firefighter Members hired prior to October 1, 2015. A. If the Member has less than five (5) y ars Crcditcd Service upon termination, the Member shall be entitled to a refund of his or her Accumulated Contributions or the Member may leave it deposited with the Fund. . _ upon termination, the Member shall be entitled to a monthly 9 retirement benefit, determined in the same manner as for normal or early retirement and based upon the Member's Credited Service, Average Final Compensation and the benefit accrual rate as of the date of termination, payable to early retirement date, determined based upon his or her actual year of Credited Service, provided he or she does not early retirement date. If the Member does not withdraw his or her otherwise normal or early retirement date, his or her designated Beneficiary shall be entitled to a benefit as provided herein for a deceased Member, vested or eligible for retirement under Pre Retirement Death. . _ _ A B. If the Member has seven (7) or more y ars of Crcditcd Service retirement benefit, determined in the same manner as for normal or early retirement and based upon the Member's Credited Service, Average Final Compensation and the him or her commencing at Member's otherwise normal or early retirement date, determined based upon his or her actual year of Credited Service, provided he or she does not provided Member survives to his or her otherwise normal or early rctircmcnt date. If the Member does not withdraw his or her Accumulated Contributions and does not survive to his or designated Beneficiary shall be entitled to a benefit as provided herein for a deceased Member, vested or eligible for retirement under Pre Retirement Death. 3. For Police Officer Members hired prior to May 16, 2017. A. If the Member has less than five (5) y ars Crcditcd Service upon termination, the Member shall be entitled to a refund of leave it deposited with the Fund. 10 upon termination, the Member shall be entitled to a monthly retirement benefit, determined in the same manner as for - • _ .. _ . e. - • -_ 1 I _. _ Credited Service, Average Final Compensation and the benefit accrual rate as of the date of termination, payable to arly rctircmcnt date, determined based upon his or her actual year of Credited Service, provided he or she does not provided Member survives to his or her otherwise normal or her otherwise normal or early retirement date, his or her designated Beneficiary shall be entitled to a benefit as retirement under Pre Retirement Death. /1. For Police Officers Members hired on or after May 16, 2017. A. If the Member has Tess than seven (7) y ars Credited Service his or her Accumulated Contributions or the Member may leave it deposited with the Fund. B. If the Member has seven (7)or more years of Credited Service retirement benefit, determined in the same manner as for normal or early retirement and based upon the Member's Credited Service, Average Final Compensation and the him or her commencing at Member's otherwise normal or early retirement date, determined based upon his or her actual year of Credited Service, provided he or she does not early rctircmcnt date. If the Member does not withdraw his or her otherwise normal or early retirement date, his or her designated Beneficiary shall be entitled to a benefit as retirement under Pre Retirement Death. If the employment of a Member with the Police or Fire department terminates for any reason other than death or retirement, and the Member has not reached the age and service requirements for early or normal retirement, he or she shall be entitled to the following; 11 1. If the Member is a : Firefighter hired prior to October 1, 2015, who has fewer than five (5) years of Credited Service upon termination; Firefighter hired on or after October 1, 2015, who has fewer than seven (7) years of Credited Service upon termination; Police Officer hired prior to May 16, 2017, who has fewer than five (5) years upon termination; Police Officer hired on or after May 16, 2017, who has fewer than (7) years upon termination, the Member may make a written request for a refund of his or her Accumulated Contributions, or, pendinq the possibility of being re-employed as a Police Officer or Firefighter, the Member may leave his or her Accumulated contributions in the System for a period of up to five (5) years following the termination. The Member's Credited Service in the System shall be deemed nullified effective the date upon which the Member receives a refund of his or her Accumulated Contributions, or the date upon which the five- year period expires, whichever is earlier. The Member's Accumulated Contributions shall be refunded upon written request, or upon the expiration of the five-year period, whichever is earlier, provided that if the total of the Accumulated Contributions is greater than $1000, said contributions shall be refunded only upon the written request of the Member, and upon the completion of a written election to receive a cash lump sum or to rollover the lump sum amount on forms designated by the Board. 2. If Paragraph 1 does not apply to the Member, the Member shall be entitled to a monthly retirement benefit, determined in the same manner as for early or normal retirement and based upon the Member's Credited Service, Average Final Compensation and the benefit accrual rate as of the date of termination, payable to him or her commencing at the Member's otherwise early or normal retirement date, determined upon his or her actual years of Credited Service, provided he or she does not elect to withdraw his or her Accumulated Contributions and provided the Member survives to his or her otherwise early or normal retirement date. If the Member does not withdraw his or her Accumulated Contributions and does not survive to his or her otherwise early or normal retirement date, his or her Designated Beneficiary shall be entitled to a benefit as provided herein for a deceased Member, vested or eliqible for retirement under Pre-Retirement Death. 3. Upon Re-employment, a Member who has received a refund of his or Accumulated Contributions may restore his or her 12 Credited Service in the System for the years to which the refund relates, if he or she repays to the System, within 90 days of the effective date of such re-employment, the full amount of the refunded Accumulated Contributions that he or she received, plus interest as determined by the Board. The benefits relating to the Credit Service thus restored shall be determined in accordance with the Average Final Compensation and the benefit accrual rate as of the date of termination. SECTION 6. That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 15, Maximum Pension, subsection 8, Ten Thousand Dollar($10,000) Limit; Less Than Ten Years of Service, to read as follows: SECTION 15. — MAXIMUM PENSION. 8. Ten Thousand Dollar ($10,000) Limit; Less Than Ten Years of Service. Notwithstanding anything in this Section 15, the retirement benefit payable with respect to a Member shall be deemed not to exceed the limit set forth in this subsection 8. of Section 15 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 ten thousand dollars ($10,000) 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 (10) years of Credited Service with the City, the limit under this subsection 8. of Section 15 shall be a reduced limit equal to ten thousand dollars ($10,000) 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 (10). * * * SECTION 7. That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 17, Miscellaneous Provisions, adding subsection 10, Missing Benefit Recipients, to read as follows: SECTION 17. — MISCELLANEOUS PROVISIONS. 13 10. Missing Benefit Recipients, The System shall follow the procedures outlined in the IRS Employee Plans Compliance Resolution System (EPCRS) Program and other applicable IRS guidance to locate any missing individuals to whom a full unreduced benefit payment is due and if, at the conclusion of such efforts, the individual cannot be located, the existing procedure of cancelling payments otherwise due (provided that, if the individual is later located, the benefits due shall be paid) will apply. SECTION 8. That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 27, Deferred Retirement Option Plan, subsection 2, Participation, subparagraph E.(1) and deleting subsection 6.H. and renumbering subsections H. through L., to read as follows: SECTION 27. - DEFERRED RETIREMENT OPTION PLAN. * * * 2. Participation. * * * E. Effect of DROP Participation on the System. (1) 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 Salary 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 Salary 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 14 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 29. After a Member commences participation in the DROP, no changes to such Member's form of benefit election shall be permitted. 6. General Provisions. * * * H. 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 (3) years from the date such payment is known adiress of such person, as shown on the records of the Board or the City. If such person has not made written • . - advice from counsel to the DROP, direct that such payment canceled on the records of the DROP. Upon such except that, in the event such person or his Beneficiary later payment or payments due to him under the DROP, the provisions of the DROP. 4H. Written Elections, Notification. (1) 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 the time and manner for making notifications, elections or designations by Members under the DROP if it 15 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. (2) 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. JI. 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. KJ. Construction. (1) The DROP shall be construed, regulated and administered under the laws of Florida, except where other applicable law controls. (2) The titles and headings of the subsections in this Section 27 are for convenience only. In the case of ambiguity or inconsistency, the text rather than the titles or headings shall control. 1 K. Forfeiture of Retirement Benefits. Nothing in this Section shall be construed to remove DROP participants from the scope of Section 22 above or Section 112.3173, Florida Statutes. DROP participants who commit a specified offense or whose employment is terminated as described in Section 22 while employed, will be subject to 16 forfeiture of all retirement benefits, including DROP benefits, pursuant to the above provisions of law. ML. 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 9. That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 29, Reemployment After Retirement, subsection (1), adding a subsection (5), After Disability Retirement, renumbering and amending the subsequent subsections (6) and (7) to read as follows: SECTION 29. REEMPLOYMENT AFTER RETIREMENT 1. Any Retiree who is retired under this System, - ' - •• -- _ _ - _ - _ _ _ -_ : , may be reemployed by any public or private employer, except the City, and may receive compensation from that employment without limiting or restricting in any way the retirement benefits payable under this System. Notwithstanding the previous sentence, reemployment by the City shall be subject to the limitations set forth in this Section. * * * 5. After Disability Retirement, A. Subject to paragraph B. below, any Retiree who is retired under Section 8., Disability ("disability retiree"), may, subject to subsection 5., Physical Examination Requirement, of that section, be reemployed by any public or private employer, and may receive compensation from that employment without limiting or restricting in any way, the retirement benefits payable under this system. B. Any disability Retiree who subsequently becomes an employee of the City in any capacity, except as a Police Officer or Firefighter, shall discontinue receipt of disability benefits from the system for the period of any such employment. 17 C. If a disability Retiree is reemployed as a Police Officer or Firefighter for the City, his disability benefit shall cease and Section 8, subsection 5. shall apply. 6 6. Reemployment of Terminated Vested Persons. Reemployed terminated vested persons shall not be subject to the provisions of this Section until such time as they begin to actually receive benefits. Upon receipt of benefits, terminated vested persons shall be treated as normal or early Retirees for purposes of applying the provisions of this Section and their status as an early or normal Retiree shall be determined by the date they elect to begin to receive their benefit. 6 7. DROP Participants. Members or r Retirees who arc or were in the Deferred Retirement Option Plan shall, following termination of employment after DROP participation, have the options provided for in this section for reemployment. SECTION 10 That the City of Ocoee Municipal Police Officers' and Firefighters' Retirement Trust Fund adopted by Ordinance No. 2010-019, as subsequently amended, is hereby further amended by amending Section 30, Supplemental Benefit Component for Special Benefits; Chapters 175 and 185 Share Accounts, subsection 4., Forfeitures and subsection 10., Maximum Additions, to read as follows: SECTION 30. - SUPPLEMENTAL BENEFIT COMPONENT FOR SPECIAL BENEFITS; CHAPTERS 175 AND 185 SHARE ACCOUNTS. * * * 4. Forfeitures. Any Member who has less than fiveseven (57) years of Credited Service and who is not otherwise eligible for payment of benefits after termination of employment with the City as provided for in subsection 5. shall forfeit his individual Member Share Account. Forfeited amounts shall be included and used as part of the Chapter 185 tax revenues for future allocations to individual Member Share Accounts on each valuation date in accordance with the formula set forth in subsection 3.A. * * * 10. Maximum Additions. Notwithstanding any other provision of this Section, annual additions under this Section shall not exceed the limitations of Internal Revenue Code Section 415(c) of the Code pursuant to the provisions of Section 15, subsection 11. 18 * * * SECTION 11. Repeal of Ordinances. All ordinances or parts of ordinances in conflict herewith are hereby repealed. SECTION 12. Severability. In the event any section, subsection, paragraph, sentence, clause, phrase or word of this ordinance shall be held invalid by a court of competent jurisdiction, then such invalidity shall not affect the remaining portions hereof. SECTION 13. Effective Date. This ordinance shall take effect upon second reading and adoption. PASSED AND ADOPTED this day of , 2020. APPROVED: ATTEST: CITY OF OCOEE, FLORIDA By: By: City Clerk Mayor (SEAL) ADVERTISED , 2019 READ FIRST TIME , 2019 READ SECOND TIME AND ADOPTED , 2020 FOR USE AND RELIANCE ONLY BY THE CITY OF OCOEE, FLORIDA APPROVED AS TO FORM AND LEGALITY THIS day of , 2020. SHUFFIELD, LOWMAN &WILSON, P.A. By: City Attorney APPROVED BY THE OCOEE CITY COMMISSION AT A MEETING HELD ON , 2020 UNDER AGENDA ITEM NO. . 19 rFOSTER & FOSTER ACTUARIES AND CONSULTANTS December 17,2019 VIA EMAIL Board of Trustees City of Ocoee Police Officers' and Firefighters' Retirement Trust Fund 646 Ocoee Commerce Pkwy Ocoee,FL 34761 Re: City of Ocoee Police Officers' and Firefighters' Retirement Trust Fund Dear Board: Enclosed is the following material,which has been prepared in support of the proposed benefit changes to the 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 Firefighters Retirement Trust Funds. It will be necessary for the Board Chairman to forward signed copies of the Actuarial Impact Statement to the two Bureaus prior to adoption. If you have any questions concerning the enclosed material,please let us know. Sincerely, Dougl. en,EA,MAAA Enclosures City of Ocoee Municipal Police Officers & Firefighters' Retirement Trust Fund ocoee florida Mr. Steve Bardin 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 Mr. Bardin: The City of Ocoee is considering amending the retirement benefits for its Firefighters and Police Officers. The amendments are described in the enclosed material. Pursuant to the provisions of Chapters 175 and 185, 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. Sii ��� harles J. Bro n City of Ocoee Municipal Police Officers& Fire Fighters' Retirement Trust Fund C/o Benefits USA Inc.3810 Inverrary Blvd. Suite 303 Lauderhill, FL 33319 Phone:954-730-2068 Toll Free:800-452-2454 Fax:954-730-0738 City of Ocoee Municipal Police Officers & Firefighters' Retirement Trust Fund ocoee florida Mr. Keith Brinkman Division of Retirement Bureau of Local Retirement Systems P. O. Box 9000 Tallahassee, FL 32315-9000 Re: Actuarial Impact Statement Dear Mr. Brinkman: The City of Ocoee is considering amending the retirement benefits for its Firefighters and Police Officers. The amendments 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 the proposed ordinance for your review. If you have any questions or if additional information is needed,please contact us. Sin :rely, .04 f r."' :r wn Chairman City of Ocoee Municipal Police Officers &Fire Fighters' Retirement Trust Fund C/o Benefits USA Inc.3810 Inverrary Blvd. Suite 303 Lauderhill, FL 33319 Phone:954-730-2068 Toll Free:800-452-2454 Fax:954-730-0738 CITY OF OCOEE POLICE OFFICERS'AND FIREFIGHTERS' RETIREMENT TRUST FUND ACTUARIAL IMPACT STATEMENT December 17,2019 (Page 1) 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 benefit changes: Chapter 2019-21,Laws of Florida was signed into effect granting certain disability and death benefits to firefighters participating in an employer-sponsored retirement plan. Effective July 1,2019,"the retirement plan must consider the firefighter totally and permanently disabled in the line-of-duty if he or she meets the retirement plan's definition of totally and permanently disabled due to the diagnosis of cancer or circumstances that arise out of the treatment of cancer." For this purpose,"cancer"is as defined in Section 112.1816(1),Florida Statutes. Similarly,a death is assumed to be in line-of-duty if the defined cancer is the cause. To value for this change,we are increasing the in line-of-duty assumption from 75%of deaths and disablements to 90%of deaths and disablements for Firefighters. Please note since the Plan does not provide for enhanced in line-of-duty death benefits there is no cost associated with the death benefit. Please note that the benefit changes provided in this ordinance only relate to the death and disability benefits for the Pension Fund and do not provide for other additional benefits that are provided for in Florida Statutes Section 112.1816. The cost impact,determined as of October 1,2018(as applicable for the fiscal year ending September 30,2020), is as follows: Proposed Current Minimum Required Contribution %of Projected Annual Payroll 41.62% 41.57% Member Contributions(Est.) %of Projected Annual Payroll 8.00% 8.00% City And State Required Contribution %of Projected Annual Payroll 33.62% 33.57% State Contribution(Est.) ' $474,624 $474,624 %of Projected Annual Payroll 5.70% 5.70% Balance From City %of Projected Annual Payroll 27.92% 27.87% 'Please see the following page for description of State Monies that are available for City funding. CITY OF OCOEE POLICE OFFICERS' AND FIREFIGHTERS' RETIREMENT TRUST FUND ACTUARIAL IMPACT STATEMENT December 17,2019 (Page 2) 'Under Chapter 2015-39,Laws of Florida,the State Monies are allocated as follows(as outlined in our February 17,2017 analysis): a. Police Officers Under the"Default"provision of Chapter 2015-39,Laws of Florida,the first$223,377.02 received annually will offset the City's contribution requirement. Future State Monies received for the Police Officers' portion of the Plan in excess of$223,377.02 will be split 50/50,with 50%allocated to the newly established Share Plan,and 50%allocated as a credit to the City's annual contribution requirements. b. Firefighters Per Mutual Consent between the City and Firefighter Members,the first$171,631.09 received annually will offset the City's contribution requirement. Since the Mutual Consent Agreement did not specify the baseline for determination of excess monies,the$171,631.09 is the difference between the prior"frozen"State Contribution of$421,323.57 and the Police portion of State Monies determined under the"Default"method from our February 17,2017 analysis($249,692.48). Future State Monies received for the Firefighters' portion of the Plan in excess of$171,631.09 will be allocated as a credit against the UAAL. If no UAAL exists,then Firefighter State Monies in excess of$171,631.09 will offset the City's annual funding obligation. Additionally,the proposed ordinance amends the Plan in the sections outlined below,and we have determined that adoption of the below amendments will have no impact on the assumptions used in determining the funding requirements to the program. 1. Section 1,Definitions,amending the definition of Credited Service to include language referring to the terms articulated in Section 8,Vesting,referencing the language regarding the rights of employees who terminate service prior to retirement. CITY OF OCOEE POLICE OFFICERS' AND FIREFIGHTERS' RETIREMENT TRUST FUND ACTUARIAL IMPACT STATEMENT December 17,2019 (Page 3) 2. Section 9,Vesting,is being amended to clarify the rights of vested and non-vested employees who terminate service prior to retirement.The amendment further articulates the process for such former employees receiving a refund of their accumulated contributions as well as articulating benefits available should such members become reemployed by the City. 3. Section 15,Maximum Pension,is being amended so that the specified limitation mirrors the current language in the Internal Revenue Code applicable to qualified plans. 4. Section 17,Miscellaneous Provisions,is being amended to add a subsection 9.,Missing Benefit Recipients.This provision is being included in accordance with a recent IRS Programs Compliance Memorandum. 5. Section 27,Deferred Retirement Option Plan,is being amended to clarify that once a member commences participation in the DROP no changes to his or her form of benefit are permitted. 6. Section 29,Reemployment After Retirement,is being amended to make several changes as required by the Internal Revenue Code to satisfy the qualification requirements applicable to the reemployment of a disability retiree. 7. Section 30,Supplemental Benefit Component for Special Benefits; Chapter 175 and 185 Share Accounts,is being amended to provide that a member who has less than seven years of Credited Service and terminates service with the City shall forfeit his individual Member Share Account. CITY OF OCOEE POLICE OFFICERS' AND FIREFIGHTERS' RETIREMENT TRUST FUND ACTUARIAL IMPACT STATEMENT December 17,2019 (Page 4) The changes presented herein are in compliance with Part VII,Chapter 112,Florida Statutes and Section 14, Article X of the State Constitution. Additionally,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 opinions contained herein.The October 1,2018 actuarial valuation report is an integral part of this statement of actuarial opinion. / 4lk- Ailb. ,�� bouglas .Loz- EA, •AA Enrollee •ctuar #17-7778 STA I'EMENT OF PLAN ADMINISTRATOR The prepared information presentee •- •, reflects the estimated cost of the proposed improvement. lop iff* _ MAIL61°V Chairman, :.and of Tr . ees COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS New Benefits Old Benefits 10/1/2018 10/1/2018 A.Participant Data Actives 131 131 Service Retirees 48 48 DROP Retirees 11 11 Beneficiaries 3 3 Disability Retirees 7 7 Terminated Vested 26 26 Total 226 226 Total Annual Payroll $8,323,562 $8,323,562 Payroll Under Assumed Ret.Age 8,323,562 8,323,562 Annual Rate of Payments to: Service Retirees 1,913,916 1,913,916 DROP Retirees 693,057 693,057 Beneficiaries 63,142 63,142 Disability Retirees 181,068 181,068 Terminated Vested 204,413 204,413 B.Assets Actuarial Value(AVA)1 54,236,928 54,236,928 Market Value(MVA)1 55,131,279 55,131,279 C.Liabilities Present Value of Benefits Actives Retirement Benefits 35,640,450 35,640,450 Disability Benefits 1,970,716 1,952,447 Death Benefits 237,314 237,314 Vested Benefits 649,344 649,344 Refund of Contributions 108,268 108,268 Service Retirees 20,987,921 20,987,921 DROP Retirees 1 10,639,831 10,639,831 Beneficiaries 617,268 617,268 Disability Retirees 1,953,434 1,953,434 Terminated Vested 1,242,404 1,242,404 Share Plan Balances 1 318,787 318,787 Total 74,365,737 74,347,468 New Benefits Old Benefits C.Liabilities-(Continued) 10/1/2018 10/1/2018 Present Value of Future Salaries 71,598,983 71,598,983 Present Value of Future Member Contributions 5,727,919 5,727,919 Normal Cost(Retirement) 1,457,321 1,457,321 Normal Cost(Disability) 147,898 143,182 Normal Cost(Death) 13,300 13,300 Normal Cost(Vesting) 70,589 70,589 Normal Cost(Refunds) 23,829 23,829 Total Normal Cost 1,712,937 1,708,221 Present Value of Future Normal Costs 13,958,869 13,928,049 Accrued Liability(Retirement) 23,427,288 23,427,288 Accrued Liability(Disability) 835,666 848,217 Accrued Liability(Death) 133,268 133,268 Accrued Liability(Vesting) 236,772 236,772 Accrued Liability(Refunds) 14,229 14,229 Accrued Liability(Inactives) 35,440,858 35,440,858 Share Plan Balances 1 318,787 318,787 Total Actuarial Accrued Liability(EAN AL) 60,406,868 60,419,419 Unfunded Actuarial Accrued Liability(UAAL) 6,169,940 6,182,491 Funded Ratio (AVA/EAN AL) 89.8% 89.8% D.Actuarial Present Value of New Benefits Old Benefits Accrued Benefits 10/1/2018 10/1/2018 Vested Accrued Benefits Inactives+Share Plan Balances 1 35,759,645 35,759,645 Actives 9,690,101 9,660,456 Member Contributions 4,948,823 4,948,823 Total 50,398,569 50,368,924 Non-vested Accrued Benefits 2,796,573 2,800,335 Total Present Value Accrued Benefits(PVAB) 53,195,142 53,169,259 Funded Ratio (MVA/PVAB) 103.6% 103.7% Increase(Decrease)in Present Value of Accrued Benefits Attributable to: Plan Amendments 25,883 Assumption Changes 0 New Accrued Benefits 0 Benefits Paid 0 Interest 0 Other 0 Total 25,883 New Benefits Old Benefits Valuation Date 10/1/2018 10/1/2018 Applicable to Fiscal Year Ending 9/30/2020 9/30/2020 E.Pension Cost Normal Cost(with interest) %of Total Annual Payroll 2 21.39 21.33 Administrative Expenses(with interest) %of Total Annual Payroll 2 1.65 1.65 Payment Required to Amortize Unfunded Actuarial Accrued Liability over 30 years (as of 10/1/2018,with interest) %of Total Annual Payroll 2 18.58 18.59 Minimum Required Contribution %of Total Annual Payroll 2 41.62 41.57 Expected Member Contributions %of Total Annual Payroll 2 8.00 8.00 Expected City and State Contribution %of Total Annual Payroll 2 33.62 33.57 1 The asset values and liabilities include accumulated DROP and Share Plan Balances as of 9/30/2018 and 9/30/2017. 2 Contributions developed as of 10/1/2018 are expressed as a percentage of total annual payroll at 10/1/2018 of$8,323,562. • ACTUARIAL ASSUMPTIONS AND METHODS Mortality Rate Healthy Active Lives: Female: RP2000 Generational, 100%Combined Healthy White Collar,Scale BB Male: RP2000 Generational, 10% Combined Healthy White Collar/90% Combined Healthy Blue Collar, Scale BB Healthy Inactive 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 above assumption rates 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 Milliman's July 1,2018 .FRS valuation report for special risk employees. We feel this assumption sufficiently accommodates future mortality improvements. Interest Rate 7.85% (prior year 7.90%)per year compounded annually,net of investment related expenses. This is supported by the target asset allocation of the trust and the expected long-term return by asset class. Salary Increases According to the below table,based on the October 30, 2015 Experience Study. Credited Service Assumed Salary Increase Less than 1 Year 13.0% 1-9 Years 5.0% 10 or more Years 4:5% Payroll Growth 2.64%for purposes of amortizing the Unfunded Actuarial Accrued Liability. This assumption cannot exceed the ten-year average payroll growth,in compliance with Part VII of Chapter 112,Florida Statutes. Administrative Expenses $132,147 annually,based on actual expenses incurred in the prior fiscal year. Normal Retirement Based on results of an Experience Study dated October 30,2015,the below table reflects the assumed rates of retirement once a member attains Normal Retirement eligibility with at least 25 years of Credited Service: 25 or more Years of Credited Service Age 45 25.0% 46 25.0% 47 25.0% 48 66.7% 49 66.7% 50+ 100.0% 1 Additionally, 100% assumed retirement upon the completion of at least 27 years of Credited Service, regardless of age. Also as part of the October 30,2015 Experience Study,the below table provides rates of retirement for members attaining Normal Retirement eligibility with less than 25 years of Credited Service: Less than 25 Years of Credited Service Age 55 80.0% 56 25.0% 57 25.0% 58+ 100.0% Early Retirement Members eligible for Early Retirement between the ages 45-54 are assumed to retire with an immediate subsidized benefit at the rate of 4%per year(except for a 25% assumption at age 50). These rates were adopted as the result of the October 30,2015 Experience Study. Termination Rate According to the below table,based on the October 30, 2015 Experience Study. Credited Service Assumed Termination Rate Less than 10 Years 5.0% 10-14 Years 2.0% 15 or more Years 0.0% Disability Rate See table below(1205). It is assumed that 75%of disablements and active Member deaths are service related. These rates are consistent with other Florida municipal special risk retirement programs. %Becoming Disabled Age During the Year 20 0.14% • 30 0.18% 40 0.30% 50 1.00% Actuarial Asset Method Each year,the prior Actuarial Value of Assets is brought forward utilizing the historical geometric 4-year average Market Value returns,net of fees. It is possible that over time this technique will produce an insignificant bias above or below Market Value. Funding Method Entry Age Normal Actuarial Cost method. SUMMARY OF CURRENT PLAN (Through Ordinance No. 2017-032) Eligibility Full-time employees who are classified as Police Officers or Firefighters participate as a condition of employment. Credited Service Total years and fractional parts of years of employment with the City as a Police Officer or Firefighter. Salary Total compensation reportable on form W-2,plus tax deferred,tax sheltered, and tax-exempt items of income. Effective October 1, 2012, Salary shall not include overtime pay in excess of 300 hours per calendar year. Additionally, any unused paid time off at the time of termination of employment is not pensionable. Average Final Compensation Average Salary for the 5 best years of the 10 years immediately preceding retirement or termination. Member Contributions 8.0%of Salary. City and State Contributions Remaining amount required in order to pay current costs and amortize unfunded past service cost,if any,as provided in Part VII,Chapter 112,F.S. Normal Retirement Date Earlier of Age 55 and 10 years of Credited Service,or 25 years of Credited Service, regardless of age. Benefit 3.5%of Average Final Compensation for each year of Credited Service. For firefighters hired after September 30,2015 and Police Officers hired after May 16,2017,the benefit accrual rate is 3.25%for each year of Credited Service. Form of Benefit Ten Year Certain and Life Annuity (options available). Maximum Benefit For Members hired before October 1,2012, 100%of Average Final Compensation. For Members hired after September 30,2012,91% of Average Final Compensation. For members hired under the 3.25%benefit accrual rate,the maximum benefit is 81.25%of Average Final Compensation. Early Retirement Eligibility Age 45 and 5 Years of Credited Service. Benefit Accrued benefit,reduced 3%per year to age 50 and actuarially reduced from age 50 to age 45. Vesting Schedule 100%after 5 years of Credited Service. For firefighters hired after September 30,2015 and Police Officers hired after May 16,2017, 100% vesting occurs after the completion of 7 years of Credited Service. Benefit Amount Member will receive the vested portion of his (her) accrued benefit payable at the otherwise Early or Normal Retirement Date. Disability Eligibility Service Incurred Covered from Date of Employment. Non-Service Incurred 10 years of Credited Service. Exclusions Disability resulting from use of drugs,illegal participation in riots,service in military,etc. Benefit Benefit accrued to date of disability but not less than 42% of Average Final Compensation (Service Incurred). Additionally,the benefit cannot exceed a percentage of Average Final Compensation as outlined above under Maximum Benefit. Duration Payable for life(with 120 payments guaranteed) or until recovery(as determined by the Board). Optional forms of payment are available. Death Benefits Pre-Retirement Vested Monthly accrued benefit payable to designated beneficiary for 10 years. Non-Vested Refund of accumulated contributions without interest. Post-Retirement Benefits payable to beneficiary in accordance with option selected at retirement. Board of Trustees a.Two Commission appointees, b. One Member from each Department elected by the Membership, and c.Fifth Member elected by other 4 and appointed by Commission. Deferred Retirement Option Plan Eligibility Within 12 months following satisfaction of Normal Retirement requirements. Participation Not more than 60 months. Rate of Return At election of Member(may change once during DROP period)either: 1)actual net rate of investment return(total return net of brokerage commissions,transaction costs,and management fees), or 2) 6.5%.Earnings are credited each fiscal quarter(2%for Members entering the DROP after September 30,2012). Form of Distribution Cash lump sum(options available)payable at termination of employment. BAC-DROP Eligibility After first eligibility for Normal Retirement. Participation Retroactively applied to date chosen by Member,but not prior to the date of first eligibility for Normal Retirement. Rate of Return Fixed 2.0%effective annual rate. Form of Distribution Cash lump sum(options available)payable at termination of employment. Supplement Benefit(Police only) Initial Crediting Pursuant to a Mutual Consent Agreement between the City and PBA,$193,673.55 from the Excess State Monies Reserve is allocated to eligible Police Officers. Annual Crediting 50%of annual Chapter 185 Premium tax revenues received by the City in excess of $223,377.02 shall be allocated based on a method to be determined. Investment earnings Eligible Share Accounts shall be credited or debited annually,based on the Plan's net-of-fees investment performance for the immediately preceding Plan Year. Expenses Allocated annually in proportion to individual Share Account Balances as a percentage of total plan assets. Vesting 100%upon completion of five years of Credited Service,unless eligible for payment of benefits upon termination of employment. Eligibility for Distribution As soon as administratively practicable following the valuation date after termination of employment. COPY OF ADVERTISEMENT Date Published and Media Name L2B The West Orange Times Thursday.December 26.2019 Advertisement or Article FIRST INSERTION CITY OF OCOEE PUBLIC HEARING A Public Hearing before the Ocoee City Commission will be held Tuesday,Janu- S ary 7,2020 at 6:15 p.m.or as soon thereafter as may be heard,in the Commission Chambers of City Hall at 150 North Lakeshore Drive,Ocoee,Florida,to consider the following: AN ORDINANCE OF THE CITY OF OCOEE,FLORIDA,RELATING TO THE CITY OF OCOEE MUNICIPAL POLICE OFFICERS'AND FIRE- FIGHTERS'RETIREMENT TRUST FUND;AMENDING ORDINANCE NUMBER 2010-019, AS SUBSEQUENTLY AMENDED; AMENDING SECTION 1, DEFINITIONS, BY AMENDING THE DEFINITION OF "CREDITED SERVICE";AMENDING SECTION 7,PRE RETIREMENT DEATH; AMENDING SECTION 8, DISABILITY; AMENDING SEC- TION 9,VESTING; AMENDING SECTION 15,MAXIMUM PENSION; AMENDING SECTION 17,MISCELLANEOUS PROVISIONS;AMEND- ING SECTION 27,DEFERRED RETIREMENT OPTION PLAN;AMEND- ING SECTION 28,REEMPLOYMENT AFTER RETIREMENT;AMEND- ING SECTION 30, SUPPLEMENTAL BENEFIT COMPONENT FOR SPECIAL BENEFITS,CHAPTERS 175 AND 185 SHARE ACCOUNTS; PROVIDING FOR SEVERABILITY OF PROVISIONS; REPEALING ALL ORDINANCES IN CONFLICT HEREWITH AND PROVIDING AN EFFECTIVE DATE. If a person decides to appeal any decision made by the above City Commission with respect to any matter considered at such hearing,they will need a record of the proceedings,and for such purpose they may need to ensure that a verbatim record of the proceedings is made,which record includes the testimony and ev- idence upon which the appeal is to be based. All interested parties are invited to attend and be heard with respect to the above. In accordance with the Americans with Disabilities Act,persons needing a special accommodation or an interpreter to participate in this proceeding should contact the City Clerk's office at 407-905-3105 at least two days prior to the date of hearing. December 26,2019 19-06122W