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HomeMy WebLinkAbout02-13-2008 MinutesApproved I IN By I I IN 01011 DO 1Z IN Bill 012"117211,412011 DION I I QMI 131 10111 P1 IVA 11 6 I. Chairman Brown called the meeting of the City of Ocoee Police Officers'/Firefighters' Retirement Trust Fund to order at 11:04 a.m. in the Commission Chambers of City Hall. The roll was called and a quorum declared present. PRESENT: Chairman Brown, Secretary Strickland, Member McCosker and Member Coschignano. Also present are Attorney Delmer, Performance Monitors Shane Coldren (Trusco), Doug Lozen (Foster & Foster), Trevor Smallwood (Merrill Lynch), and -Recording Secretary Betty Decker. ABSENT: Member Gledich — Absent excused. Secretary Strickland makes a motion to apin-ove the Minutes fi-om December 13, 2008, and the special meeting- minutes from danuary 18, 2008, seconded by Member McCosker. Motion passed unanimously. 111. NEW BUSINESS Chairman Brown opened with a recap of the special meeting on January 8, 2008 stating that we have hired Bogdahn as our new Money Manager and that this is Merrill Lynch' last reporting meeting. Doug Lozen with Foster and Foster gave a presentation on the cost benefit improvements available to make to the plan. Line of Duty disability improvements — if member is granted line of duty they receive 42% from day one. Foster was tasked to increase it to 60-70% - the review of state monies increased from $87,000 to $320,000, which is a significant increase. Employee contribution would go up and there is a reserve of $63,000. Automatic cost of living investment - maxed out of state money and there would be a cost to the City of 4% of payroll — automatic cola of 2 to 3% for life of retiree, compounded annually - will receive a 2 - 3 % increase every year which helps the benefit keep up with inflation. 13th check - this analysis is for future retirees, not current retirees. Instead of 12 payments in a year this would go up to 13. This will max out state monies so there is a cost for the City. Trustees would have to determine what monies are sitting in assets and if we are to dip into it. Any City contributions would need approval from City Commission. Page 1 of 4 Approved "20 and Out" - retire after 20 yrs — This option is to increase the amount if the employee retires after 20 yrs. instead of 25, and would be at 60% instead of 75% - this would take an increase of 8% of payroll. This is not uniform across the board but a cola is. This might be monies that go into the plan but is never utilized. Attorney Delmer commented that if you have it in the plan and it's not used then we're funding for a benefit that's not being used and that money could be used for some other benefit. Benefit rate increase — Foster looked into taking the multiplier up from 3% for each year of service to 3 1/4% - 25 yr. at 75% and add 3.5 years so it goes to 81 1/4%, which would be a 2.6% of payroll increase. Chairman Brown - The HR Director contacted me and he is planning for a negotiation - we can't vote on it but only make recommendations to the HR Director for him to present to the City Commission. Doug Lozen — "and if the City approves the ordinance they are obligated to the 2.6% increase." Chairman Brown asked for questions or comments from those present in the audience: Mike Reed (Fire Dept.) — (referring to hand-out information) - under the '-proposed state contribution', is that the total money the City collected last year? Doug Lozen - one from Fire and one from Police the year before - $208,000. We have to pay for the past benefit and anything above that goes into the pot. The old cap plus the new benefit is the $354,000 figure. If we wait until next year, the 185 money could cover or offset this. Mike Reed - as of October 1, 2008, that number could change? Doug Lozen — "yes." Mike Reed — (addressing the Board) - Are you going to make a decision or have more discussion of this? Chairman Brown - That would be up to a motion by the Board but we do have some to discuss about this. Mike Reed - the percentage increase is always good! Has HR been contacted regarding negotiations of these points? Attorney Definer - no discussions of this yet. He has asked Chairman Brown for information and for guidance and direction from the Board before a vote can be taken. Chairman Brown — "It's complicated because the City is involved and we can vote all we want but"... Mike Reed — "you as a Board would vote for benefits — like the last time the vote was that Fire was against it but with the amount of Police votes, it was passed." Chairman Brown — "a vote would be accumulative, not split." Secretary Strickland — "the board has to vote it in and has the final decision." Chief Firstner (Fire Dept.) — "have you considered any other benefit enhancements other than these?" Ken Strickland — "we need to look at some other issues that could save the plan money and if these changes are going to be in our best interest." Doug Lozen — Page 2 of 4 Approved "There would be a slight savings to the plan. Administratively, you might want to change it to 10 years vested; that's more beneficial to move it back to 10 for payroll savings." Another option is if we are unhappy with a benefit can we use that for the current ones and change that benefit just for the future retirees? Chairman Brown — yes, I was looking into that also and realized the current retirees would have to keep their current benefit. Steve Goclon from the PD asked - over what period of time does it take for that 3% cola to equal the 3.5% multiplier at 25 years? Doug Lozen — the 3% cola is more like a 3% multiplier benefit rate with a 2% cola is about the same as a 3 1/2multiplier without. The 3 1/2 multiplier, if you start out high, it stays there instead of building up to it. The 3% benefit rate with a 2% cola raises and where they cross is at the expected time of death. The board discusses the options and the favorable plan is upgrading the disability option. 13th Check option and the 20 and Out option seems too expensive at this time. Further discussion continues. The board will look at vesting after 10 years; increase disability to 60%; discussion regarding the COLA will take place later; change in increasing multiplier is worth investigating at a later date. Chairman Brown recommends that we present these items to the members and add the proposed disability benefit — get best average of best three - if they vote for it we will get a study done by Foster and Foster. Deputy Chief Goclon said in the past the members weren't always given the whole synopsis to be able to do an educated vote. This needs explained before a vote is taken. Board agrees. They will propose the changes and ask for a vote. Secretary Strickland motioned to authorize payment of bills, seconded by Member Coschignano. Motion passed. LIAtt-I D I W At W ACTUARY REPORT - Doug Lozen gives the quarterly Actuary Report. Copies of a proposal for a rate increase for Foster & Foster was distributed to the Board. The fees that are in place now shows the last increase was Oct. 2004 - Foster is asking for a raise and the new fee is locked in for three years. They are asking this off all clients. Chairman Brown - motions or comments? Motion is made by Member Coschiznano to accept Fosters new contract, seconded by Secretary Strickland. Motion vassed unanimously. Page 3 of 4 Approved Secretary Strickland also makes a motion to aDPr0i7e Foster's current invoice, seconded by Member Coschiznano,- motion massed unanimously and Foster agrees to credit a charze of $30 for copy of the liability aVvement certificate, which was auestioned by Chairman Brown. Doug Lozen will have the evaluation and experience study for the May meeting. PERFORMANCE MONITOR — Shane Caldron from Trustco was introduced and passed out information through the fourth quarter of 2007 for review. MONEY MANAGER — Trevor from Merrill Lynch gave the 2007, 4th quarter report, minus the information from Evergreen, as it was not submitted in time. Chairman Brown mentioned the changed from Merrill Lynch to Bogdahn. VI. ATTORNEY COMMENTS Attrny. Delmer began with an update on the Merrill Lynch situation and keep us posted to the outcome of the investigation. The Statute will be changing for Trustees' term to go from two years to a four year term. Update on use of Social Security numbers. We drafted a change in the requirement in reference to heart disease, hyper -tension and heart problems in the line duty. We can do a separate ordinance for benefit changes. Secretary Strickland made a motion to amend the lanzuajze in the ordinance, seconded by Chairman Brown. Motion Dassed unanimously. VII. SET NEXT MEETING Chairman Brown sets the next regular Board Meeting for Wednesday, May 14, 2008, at 1:00 p.m. in the Commission Chambers in City Hall. VIII. ADJOURNMENT Motion to adjourn was made by Chairman Brown seconded by Secretary Strickland. Meeting adjourned at 1:41 p.m. Res ectfully submitted, igetty Dee, r, Pension Boar q Recording Secretary ai airman Ch rl e Brown, Contact the City Clerk's Office to listen to electronic copies of these minutes. Page 4 of 4