HomeMy WebLinkAboutItem #14 Changes to the City of Ocoee Municipal General Employees' Retirement Trust Fund ,Sre ce nter of G
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AGENDA ITEM COVER SHEET
Meeting Date: 09/18/12
Item # I
Reviewed By ::
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Contact Name: Gene Williford Department Director:
Contact Number: 1032 City Manager:
Subject: Approval of changes to the City of Ocoee Municipal General Employees' Retirement Trust Fund
relating to retirement age, vesting, and various other changes affecting "future" employees.
Background Summary:
With the continuing economic uncertainty staff has initiated these recommended changes in order for the
current and long -term sustainability of the plan. With lower investment returns, reduced city revenues and an
aging workforce these revisions are necessary for the future of the plan as well as the trend for public pension
plans in general.
Issue:
Amendment to the General Employees' Pension Ordinance to include revisions necessitated by changes in
state statute and continued financial viability of the plan.
Recommendations:
Staff respectfully recommends the Commission adopt the changes as amended in the attached Ordinance for
the City of Ocoee Municipal General Employees' Retirement Trust Fund.
Attachments:
An Ordinance Amendment drafted by legal counsel for the General Employees' Pension Board, the Actuarial
Report from Foster & Foster and a comparison of changes.
Financial Impact:
To provide for the future financial stability of the plan and the City's contributions.
Type of Item:
❑ Public Hearing For Clerk's Dept Use:
❑ Ordinance First Reading ❑ Consent Agenda
❑ Ordinance Second Reading ❑ Public Hearing
❑ Resolution ❑ Regular Agenda
❑ Commission Approval
❑ Discussion & Direction
❑ 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 ( ) ❑ N/A
Comparison of Proposed Changes to the
City of Ocoee Municipal General Employees' Retirement Trust Fund
Plan for "existing" employees Plan for "future" employees
Normal Retirement Age 60 years 62 years
Retirement/Years 60 years old 62 years old
Of Service no minimum minimum of 7
years of service years of service
Vesting 5 years 7 years
Multiplier 3% 2.25%
Maximum Benefit 81% of salary 70% of salary
DROP Eligibility Age 60 Age 62
no minimum minimum of 10
years of service years of service
DROP Period 84 months 60 months
DROP Account 6.5% 3%
Interest Rate
Foster&F
Actuaries and Consultants
July 5, 2012
VIA EMAIL AND MAIL
Board of Trustees
City of Ocoee
Municipal General Employees' Retirement Trust Fund
150 N. Lakeshore Avenue
Ocoee, FL 34761
Re: City of Ocoee
Municipal General Employees' 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 proposed changes.
2, Draft of a transmittal letter to the Bureau of Local Retirement Systems.
It will be necessary for the Chairman to sign one (1) copy of each Actuarial Impact
Statement as the Plan Administrator and forward the Impact Statement, along with a
copy of the proposed Ordinance, to the Bureau prior to adoption.
If you have any questions concerning the enclosed material, please let me know.
Sincerely,
Dou �as H. Ldzen
DHL/Ike
Enclosures
13420 Parker Commons Blvd., Suite 104 • Fort Myers, Florida 33912 • 239-433-5500 • Fax 239 - 481 -0634 • www.foster- foster.com
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 the implementation of amended retirement benefits for its
General Employees. 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 and a copy of the proposed Ordinance for your review.
If you have any questions or if additional information is needed, please contact us.
Sincerely,
CITY OF OCOEE
MUNICIPAL GENERAL EMPLOYEES' RETIREMENT TRUST FUND
ACTUARIAL IMPACT STATEMENT
July 5, 2012
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
implementation of the following changes:
1. Amending the definition of Salary to comply with the regulations set forth in .
Senate Bill 1128. Effective July 1, 2011, Salary shall not include more than three
hundred (300) hours of overtime per fiscal year. Additionally, Salary will include
the lesser of the amount of unused paid time off accrued as of July 1, 2011, or
the actual amount of unused paid time off for which the retiree receives payment
at the time of retirement, based upon the Retiree's then hourly rate of pay.
2. Amending Normal Retirement Date for future hires (except a Mayor or
Commissioner) to be attainment of age 62 and the completion of 7 years of
Credited Service.
3. Reducing the benefit accrual rate for future hires to 2.25% of Average Final
Compensation for each year of Credited Service. The maximum benefit shall not
exceed 70% of Average Final Compensation.
4. Amending Early Retirement Date for future hires (except a Mayor or
Commissioner) to be attainment of age 50 and the completion of 7 years of
Credited Service.
5. Increasing the vesting provision for future hires (except a Mayor or
Commissioner) to completion of 7 years of Credited Service, regardless of age.
6. Amending the DROP eligibility participation date for future hires to require a
minimum of 10 years of Credited Service and having attained Normal Retirement
eligibility.
7. Reducing the maximum DROP participation period for future hires which cannot
exceed 60 months beginning on the date which the Member first becomes
eligible for Normal Retirement.
8. Reducing the fixed interest DROP crediting rate for future hires to be 3.0% per
annum, compounded monthly. Additionally, future hires shall not be allowed to
elect the DROP crediting option which is equal to actual net rate of investment
return realized by the System.
The following assumptions are utilized for purposes of this Impact Statement:
Current Credited Service Change to Final Salary Increase Assumption
10 or more years No Change
1 to 10 years Reduced by 50%
Less than 1 year Reduced by 100% (No Increase Assumed)
It is important to point out that these assumptions are estimates, and are subject to further
modification based on future experience. Subsequent changes will be reflected in future
actuarial valuations.
CITY OF OCOEE
MUNICIPAL GENERAL EMPLOYEES' RETIREMENT TRUST FUND
ACTUARIAL IMPACT STATEMENT
July 5, 2012
(Page 2)
The cost impact, determined as of October 1, 2011, as applicable to the fiscal year ending
September 30, 2013, is as follows:
Current Proposed
Total Required Contribution
% of Total Annual Payroll 30.27% 29.89%
Member Contributions (Est.)
% of Total Annual Payroll 7.36% 7.36%
Balance from City
% of Total Annual Payroll 22.91% 22.53%
Please note that adopting the proposed changes stated in Items 2 - on the previous
page will have no immediate impact on the City's funding requirements since they are
only applicable to future new hires. Please also note that the effective date of these
changes has not been established, but if adopted, these changes shall be applicable to
future new hires on and after the established effective date.
The changes presented herein are in compliance with Part VII, Chapter 112, Florida
Statutes and Section 14, Article X of the State Constitution.
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Enrollee Actuary • 11 -7778
STATEMENT OF PLAN ADMINISTRATOR
The prepared information presented herein reflects the estimated cost of the proposed
changes.
Chairman, Board of Trustees
Comparative Summary of Principal Valuation Results
New Benefits Old Benefits
10/1/2011 10/1/2011
A Participant Data
Number Included
Actives 178 178
Service Retirees 59 59
Beneficiaries 5 5
Terminated Vested 38 38
Disability Retirees 0 0
DROP Retirees 5 5
Total 285 285
Total Annual Payroll $8,018,775 $8,018,775
Payroll Under Assumed Ret. Age 8,018,775 8,018,775
Annual Rate of Payments to:
Service Retirees 828,124 828,124
Beneficiaries 33,446 33,446
Terminated Vested 318,794 318,794
Disability Retirees 0 0
DROP Retirees 124,445 124,445
B. Assets
Actuarial Value 19,755,687 19,755,687
Market Value 18,919,352 18,919,352
C. Liabilities
Present Value of Benefits
Active Members
Retirement Benefits 24,035,581 24,292,826
Disability Benefits 0 0
Death Benefits 394,468 397,715
Vested Benefits 1,676,516 1,684,936
Refund of Contributions 345,000 345,000
Service Retirees 7,841,700 7,841,700
Beneficiaries 224,914 224,914
Terminated Vested 1,565,236 1,565,236
Disability Retirees 0 0
DROP Retirees 1,313,389 1,313,389
Total 37,396,804 37,665,716
New Benefits Old Benefits
10/1/2011 10/1/2011
C. Liabilities - (Continued)
Present Value of Future Salaries 64,150,576 64,150,576
Present Value of Future Member Cont. 4,722,932 4,722,932
Normal Cost (Entry Age Normal)
Service Retirement 1,310,756 1,332,690
Disability Benefits 0 0
Death Benefits 18,105 18,376
Vested Benefits 60,315 60,845
Refunds 21,311 21,311
Total Normal Cost '1,410,487 1,433,222
Present Value of Future Normal Costs 9,413,625 9,574,942
Actuarial Accrued Liability
Service Retirement 15,510,921 15,613,030
Disability Benefits 0 0
Death Benefits 247,785 248,956
Vested Benefits 1 ,051 ,379 1 ,055,694
Refunds 227,855 227,855
Inactives 10,945,239 10,945,239
Total Actuarial Accrued Liability 27,983,179 28,090,774
Unfunded Actuarial Accrued Liability 8,227,492 8,335,087
D. Actuarial Present Value of Accrued Benefits
Vested Accrued Benefits
Inactives 10,945,239 10,945,239
Actives 5,466,511 5,466,511
Member Contributions 3,717,316 3,717,316
Total 20,129, 066 20,129,066
Non - vested Accrued Benefits 462,469 462,469
Total Present Value Accrued 20,591,535 20,591,535
Benefits
Increase (Decrease) in Present Value of
Accrued Benefits Attributable to:
Plan Amendments 0
Assumption Changes 0
New Accrued Benefits 0
Benefits Paid (net of DROP lump sums) 0
Interest 0
Other 0
Total: 0
New Benefits Old Benefits
Valuation Date 10/1/2011 10/1/2011
Applicable to Fiscal Year Ending 9/30/2013 9/30/2013
E. Pension Cost
Normal Cost (with interest)
% of Total Annual Payroll* 18.29 18.59
Expected Adminstrative Expense
% of Total Annual Payroll* 0.65 0.65
Payment Required to Amortize
Unfunded Actuarial Accrued
Liability over 30 years
(as of 10/1/11)
% of Total Annual Payroll* 10.95 11.03
Total Required Contribution
% of Total Annual Payroll* 29.89 30.27
Expected Member Contributions
% of Total Annual Payroll* 7.36 7.36
Expected City Contrib.
% of Total Annual Payroll* 22.53 22.91
* Contributions developed as of 10/1/11 are expressed as a percentage
of total annual payroll at 10/1/11 of $8,018,775.
ACTUARIAL ASSUMPTIONS AND FUNDING METHODS
Assumptions
Mortality Rate RP2000 Combined Healthy
Mortality Table (sex distinct).
Interest Rate 8% per year compounded annually,
net of investment related expenses.
Retirement Age Age 60. Also, any Member who has
reached Normal Retirement is
assumed to continue employment for
one additional year.
Early Retirement Commencing with the earliest Early
Retirement Age (50), Members are
assumed to retire with an immediate
subsidized benefit at the rate of 2% per
year.
Disability Rate See table below (1202).
Termination Rate See table below (T -3).
Salary Increases 6.0% per year until the assumed
retirement age; see table below.
Projected salary at retirement is
increased 20% to account for
non - regular compensation.
Payroll Increases 3.3% per year.
Administrative Expenses $50,468 annually.
Terminating % Becoming Disabled Current Salary as %
Age During the Year During the Year of Salary at age 60
20 50.0% 0.051% 9.7%
30 34.9 0.058 17.4
40 3.8 0.121 31.2
50 1.5 0.429 55.8
Funding Methods
Entry Age Normal Actuarial Cost Method.
SUMMARY OF PLAN PROVISIONS
(Through Ordinance No. 2009 -020)
Eligibility Full -time employees who are classified
as General Employees participate as a
condition of employment.
Credited Service Total years and fractional parts of years
of service with the City as a General
Employee.
Salary W -2 Compensation, plus tax - deferred,
tax - exempt, and tax - sheltered items of
income.
Average Final Compensation Average Salary for the 5 best years of
the 10 years immediately preceding
retirement or
termination.
Member Contributions 7.4% of Salary. The Mayor and
Commissioners are non- contributory
participants.
City Contributions Remaining amount required in order to
pay current costs and amortize
unfunded past service cost, if any, over
30 years.
Normal Retirement
Date Attainment of Age 60.
Benefit 3.0% of Average Final Compensation
times Credited Service. The maximum
benefit is 81% of Average Final
Compensation.
Form of Benefit Ten Year Certain and Life Annuity
(options available).
Early Retirement
Eligibility Age 50 and 5 Years of Credited Service.
Benefit Accrued benefit, actuarially reduced.
Vesting
Schedule 100% after 5 years of Credited Service.
Benefit Amount Member will receive the vested portion
of his (her) accrued benefit payable at
the otherwise Early or Normal Retire-
ment Date.
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 City Commission appointees,
b. Two Members of the Plan elected by
the Membership, and
c. Fifth Member elected by other 4 and
appointed by City Commission.
Deferred Retirement Option Plan
Eligibility Within 12 months following satisfaction
of Normal Retirement requirements (age
60).
Deferred Retirement Option Plan (continued)
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.
Form of Distribution Cash lump sum (options available).
ORDINANCE NO.
AN ORDINANCE OF THE CITY OF OCOEE, FLORIDA,
RELATING TO THE CITY OF OCOEE MUNICIPAL
GENERAL EMPLOYEES' RETIREMENT TRUST FUND,
ADOPTED AND RESTATED IN FULL BY ORDINANCE
NUMBER 2009 -020; AS SUBSEQUENTLY AMENDED;
AMENDING SECTION 1, DEFINITIONS AMENDING THE
DEFINITION OF "SALARY "; AMENDING SECTION 6,
BENEFIT AMOUNTS AND ELIGIBILITY; AMENDING
SECTION 8, VESTING; AMENDING SECTION 25,
DEFERRED RETIREMENT OPTION PLAN; 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 Ordinance No. 2009 -020, adopting the amended and restated City
of Ocoee Municipal General Employees' Retirement Trust Fund, as subsequently amended,
is hereby amended by amending Section 1, Definitions, definition of "Salary ", to read as
follows:
Salary means the total compensation (and travel stipend for the Mayor and Commissioners)
reported on the Member's W -2 form plus all tax deferred, tax sheltered or tax exempt items of
income derived from elective employee payroll deductions or salary reductions. For service earned
on or after July 1, 2011, Salary shall not include more than three hundred (300) hours of overtime
per fiscal year. Provided however, in any event, payments for overtime in excess of three hundred
(300) hours per year accrued as of July 1, 2011 and attributable to service earned prior to the July
1, 2011, may still be included in Salary for pension purposes even if the payment is not actually
made until on or after July 1, 2011. In any event, with respect to unused paid time off accrued prior
to July 1, 2011, Salary will include the lesser of the amount of paid time off accrued on July 1, 2011
or the actual amount of paid time off for which the Retiree receives credit or payment at the time of
retirement, based upon the Retiree's then hourly rate of pay, regardless of whether the amount of
paid time off was, at some time prior to retirement, reduced below the amount on July 1, 2011.
Compensation in excess of limitations set forth in Section 401 (a)(17) of the Code as of the first day
of the Plan Year shall be disregarded for any purpose, including employee contributions or any
benefit calculations. The annual compensation of each member taken into account in detennining
benefits or employee contributions for any Plan Year beginning on or after January 1, 2002, may not
exceed $200,000, as adjusted for cost -of- living increases in accordance with Code Section
401(a)(17)(B). Compensation means compensation during the fiscal year. The cost -of- living
adjustment in effect for a calendar year applies to annual compensation for the determination period
that begins with or within such calendar year. if the determination period consists of fewer than 12
months, the annual compensation limit is an amount equal to the otherwise applicable annual
compensation limit multiplied by a fraction, the numerator of which is the number of months in the
short determination period, and the denominator of which is 12. If the compensation for any prior
determination period is taken into account in determining a Member's contributions or benefits for
the current Plan Year, the compensation for such prior determination period is subject to the
applicable annual compensation limit in effect for that prior period. The limitation on compensation
for an "eligible employee" shall not be less than the amount which was allowed to be taken into
account hereunder as in effect on July 1, 1993. "Eligible employee" is an individual who was a
Member before the first Plan Year beginning after December 31, 1995.
* * * **
Page 1
SECTION 3: That Ordinance No. 2009 -020, adopting the amended and restated City
of Ocoee Municipal General Employees' Retirement Trust Fund, as subsequently amended,
is hereby amended by amending Section 6, Benefit Amounts and Eligibility, subsections 1., 2.
and 3., to read as follows:
1. Normal Retirement Date.
A Members (except a Mayor or Commissioner Member) who became a Member
prior to (effective date) shall have a normal retirement date of uuiu,al dates shall be the
first day of the month coincident with, or next following the attainment of age sixty (60) regardless
of the years of Credited Service. A Member (except a Mayor or Commissioner Member) who
became a Member on or after (effective date) shall have a nonnal retirement date of the first day of
the month coincident with, or next following the attainment of age sixty -two (62) and the completion
of seven (7) years of Credited Service. A Mayor or Commissioner Member's normal retirement date
shall be the first day of the month coincident with, or next following the attainment of age sixty (60)
and the completion of nine (9) years of Credited Service. A Member may retire on his or her normal
retirement date or on the first day of any month thereafter, and each Member shall become 100%
vested in his or her accrued benefit on the Member's normal retirement date. Nonnal retirement
under the System is Retirement from employment with the City on or after the normal retirement
date.
2. Normal Retirement Benefit.
A Member who became a Member prior to (effective date) retiring hereunder on or
after his or her nonnal retirement date shall receive a monthly benefit which shall commence on the
first day of the month next following his or her Retirement and be continued thereafter during
Member's lifetime, ceasing upon death, but with one hundred twenty (120) monthly payments
guaranteed in any event. The monthly retirement benefit shall equal three percent (3 %) of Average
Final Compensation, for each year of Credited Service, up to a maximum benefit not to exceed
eighty -one percent (81 %) of Average Final Compensation of the Member. A Member who became
a Member on or after (effective date) retiring hereunder on or after his or her normal retirement date
shall receive a monthly benefit which shall commence on the first day of the month next following
his or her Retirement and be continued thereafter during Member's lifetime, ceasing upon death, but
with one hundred twenty (120) monthly payments guaranteed in any event. The monthly retirement
benefit shall equal two and twenty -five hundredths percent (2.25 %) of Average Final Compensation,
for each year of Credited Service, up to a maximum benefit not to exceed seventy percent (70 %) of
Average Final Compensation of the Member.
3. Early Retirement Date.
A Member (except a Mayor or Commissioner Member) who became a Member prior
to (effective date) may retire on his or her early retirement date which shall be the first day of any
month coincident with or next following the attainment of age fifty (50) and the completion of five
(5) years of Credited Service. A Member (except a Mayor or Commissioner Member) who became
a Member on or after (effective date) may retire on his or her early retirement date which shall be
the first day of any month coincident with or next following the attainment of age fifty (50) and the
completion of seven (7) years of Credited Service. A Mayor or Commissioner Member may retire
on his or her early retirement date which shall be the first day of any month coincident with or next
following the attainment of age fifty (50) and the completion of nine (9) years of Credited Service.
Early retirement under the System is Retirement from employment with the City on or after the early
retirement date and prior to the normal retirement date.
* * * **
Page 2
SECTION 4: That Ordinance No. 2009 -020, adopting the amended and restated City
of Ocoee Municipal General Employees' Retirement Trust Fund, as subsequently amended,
is hereby amended by amending Section 8, Vesting, to read as follows:
SECTION 8. VESTING.
If a Member terminates his or her employment with the City, either voluntarily or by
discharge, and is not eligible for any other benefits under this System, the Member shall be entitled
to the following:
1. If the Member who became a Member prior to (effective date) has less than five (5)
years Credited 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. If the Member
who became a Member on or after (effective date) has less than seven (7) years Credited 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.
2. If the Member (except a Mayor or Commissioner Member) who became a Member
prior to (effective date) has five (5) or more years of Credited Service or if the Member who became
a Member on or after (effective date) has seven (7) or more years of Credited Service or if a Mayor
or Commissioner Member has nine (9) or more years of Credited Service upon tennination, the
Member shall be entitled to a monthly retirement benefit, determined in the same manner as for
nonnal 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 him or her
commencing at the Member's otherwise nonnal or early retirement date, provided he or she does not
elect to withdraw his or her Accumulated Contributions and provided the Member survives to his
or her normal or early retirement date. If the Member does not withdraw his or her Accumulated
Contributions and does not survive to 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.
SECTION 5: That Ordinance No. 2009 -020, adopting the amended and restated City
of Ocoee Municipal General Employees' Retirement Trust Fund, as subsequently amended,
is hereby amended by amending Section 25, Deferred Retirement Option Plan, subsections 2.
and 3., to read as follows:
2. Participation.
A. Eligibility to Participate.
In lieu of terminating his or her employment as a General Employee, any
Member who became a Member prior to (effective date) and who is eligible
for normal retirement under the System may elect to defer receipt of such
service retirement pension and to participate in the DROP. Any Member who
became a Member on or after (effective date) must have a minimum of ten
(10) years Credited Service and be eligible for nonnal retirement.
B. Election to Participate.
A Member's election to participate in the DROP must be made in writing in
a time and manner determined by the Board and shall be effective on the first
day of the first calendar month which is at least fifteen (15) business days
after it is received by the Board.
Page 3
C. Period of participation.
A Member who became a Member prior to (effective date) who elects to
participate in the DROP under subsection 2.B., shall participate in the DROP
for a period not to exceed eighty -four (84) months beginning on the date
which the Member first becomes eligible for normal retirement. A Member
who became a Member on and after (effective date) who elects to participate
in the DROP under section 2.B., shall participate in the DROP for a period
not to exceed sixty (60) months beginning on the date which the Member first
becomes eligible for normal retirement. An election to participate in the
DROP shall constitute an irrevocable election to resign from the service of
the City at the time of election into the DROP. A Member may participate
only once.
3. Funding.
A. Establishment of DROP Account.
A DROP Account shall be established for each Member participating in the
DROP. A Member's whose DROP participation began prior to (effective
date) shall have a DROP Account consisting_DROP Act vu�� shall �uttsist of
amounts transferred to the DROP under subsection 3.B., and earnings or
interest on those amounts.
A Member whose DROP participation began on or after (effective date) shall
have a DROP Account consisting of amounts transferred to the DROP under
subsection 3.C. and interest on those amounts.
B. Transfers From Retirement System.
(1) As of the first day of each month of a Member's period of
participation in the DROP, the monthly retirement benefit he or she
would have received under the System had he or she terminated his
or her employment as a General Employee and elected to receive
monthly benefit payments thereunder shall be transferred to his or her
DROP Account, except as otherwise provided for in subsection
2.D.(2). A Member's period of participation in the DROP shall be
determined in accordance with the provisions of subsections 2.C. and
2.D., but in no event shall it continue past the date he or she
terminates his or her employment as a General Employee.
(2) Except as otherwise provided in subsection 2.D.(2), a Member's
DROP Account under this subsection 3.B. shall be debited or credited
after each fiscal year quarter with either:
(a) Interest at an effective rate of six and one -half percent (6.5 %)
per annum compounded monthly on the prior month's ending
balance; or
(b) Earnings, determined as follows:
The average daily balance in a Member's DROP Account
shall be credited or debited at a rate equal to the actual net
rate of investment return realized by the System for that
quarter. "Net investment return" for the purpose of this
paragraph is the total return of the assets in which the
Page 4
Member's DROP Account is invested by the Board net of
brokerage commissions, transaction costs and management
fees.
Upon electing participation in the DROP, the Member shall elect to
receive either interest or earnings on his or her account to be
determined as provided above. The Member may, in writing, elect to
change his or her election only once during his or her DROP
participation. An election to change must be made prior to the end of
a quarter and shall be effective beginning the following quarter.
(3) A Member's DROP Account shall only be credited or debited with
earnings or interest and monthly benefits while the Member is a
participant in the DROP. A Member's final DROP account value for
distribution to the Member upon termination of participation in the
DROP shall be the value of the account at the end of the quarter
immediately preceding termination of participation plus any monthly
periodic additions made to the DROP account subsequent to the end
of the previous quarter and prior to distribution. If a Member fails to
terminate employment after participating in the DROP the
permissible period of DROP participation, then beginning with the
Member's 1st month of employment following the last month of the
permissible period of DROP participation, the Member's DROP
Account will no longer be credited or debited with earnings or
interest, nor will monthly benefits be transferred to the DROP
account. All such non - transferred amounts shall be forfeited and
continue to be forfeited while the Member is employed by the City,
and not cost -of- living adjustments shall be applied to the Member's
credit during such period of continued employment. A Member
employed by the City after the permissible period of DROP
participation will still not be eligible for pre- retirement death or
disability benefits, nor will he or she accrue additional Credited
Service, except as provided for Section 24, Reemployment After
Retirement.
C. Transfers From Retirement System.
(1) As of the first day of each month of a Member's period of
participation in the DROP, the monthly retirement benefit he or she
would have received under the System had he or she terminated his
or her employment as a General Employee and elected to receive
monthly benefit payments thereunder shall be transferred to his or her
DROP Account, except as otherwise provided for in subsection
2.D.(2). A Member's period of participation in the DROP shall be
determined in accordance with the provisions of subsections 2.C. and
2.D., but in no event shall it continue past the date he or she
terminates his or her employment as a General Employee.
(2) Except as otherwise provided in subsection 2.D.(2), a Member's
DROP Account under this subsection 3.C. shall be credited with
interest at an effective rate of three percent (3 %) per annum
compounded monthly on the prior month's ending balance.
(3) A Member's DROP Account shall only be credited with interest and
monthly benefits while the Member is a participant in the DROP. A
Member's final DROP account value for distribution to the Member
upon termination of participation in the DROP shall be the value of
Page 5
the account at the end of the quarter immediately preceding
termination ofparticipation plus any monthly periodic additions made
to the DROP account subsequent to the end of the previous quarter
and prior to distribution. If a Member fails to terminate employment
after participating in the DROP the permissible period of DROP
participation, then beginning with the Member's 1st month of
employment following the last month of the permissible period of
DROP participation, the Member's DROP Account will no longer be
credited with interest, nor will monthly benefits be transferred to the
DROP account. All such non - transferred amounts shall be forfeited
and continue to be forfeited while the Member is employed by the
City, and no cost -of- living adjustments shall be applied to the
Member's credit during such period of continued employment. A
Member employed by the City after the permissible period of DROP
participation will still not be eligible for pre - retirement death or
disability benefits, nor will he or she accrue additional Credited
Service, except as provided for Section 24, Reemployment After
Retirement.
* * * **
SECTION 6. Repeal of Ordinances. All ordinances or parts of ordinances in conflict
herewith are hereby repealed.
SECTION 7. Effective Date. This ordinance shall be effective on the date of adoption;
however, Section 2 of this ordinance shall be retroactively effective on July 1, 2011.
PASSED AND ADOPTED this day of , 2012.
APPROVED:
ATTEST: CITY OF OCOEE, FLORIDA
By:
Beth Eikenberry, City Clerk S. Scott Vandergrift, Mayor
(SEAL)
ADVERTISED , 2012
READ FIRST TIME , 2012
READ SECOND TIME AND ADOPTED
, 2012
FOR USE AND RELIANCE ONLY BY
THE CITY OF OCOEE, FLORIDA
APPROVED AS TO FORM AND LEGALITY
THIS day of , 2012
Page 6
CHRISTIANSEN & DEHNER, P.A.
Special Counsel
By:
APPROVED BY THE OCOEE CITY
COMMISSION AT A MEETING HELD ON
, 2012 UNDER AGENDA
ITEM NO.
ksh \ococc \gcn \06- 28- 12.ord
Page 7
c_o_..py of Advertisement that ran in the print medial
Date Published and Media Name
E2 Orlando Sentinel r A S 0
Advertisement or Article
- --- vTV'!,r 'rt:' E - FOWL H%a R'.w;
A t o.,r Hex,.ng !.c nu.. ti.r 0cr e Cyr Cot
rnisr.r.n :n!; t
h, c
Der" • seen
ue crew!,, in the
Commission Cron.bers cf
150 North Lakeshore Drive, ..
, -;rr.da, to consider the followi.
AN ORDINANCE OF THE CITY OF OCOEF 4091
DA, RELATING TO THE CITY OF OCOEE M1N'CI
PAL GENERAL EMPLOYEES' RETIREMENT TROSI
FUND. ADOPTED AND RESTATED IN FULL OY
ORDINANCE NUMBER 2009 -020; AS 5UO0L-
DEFINITIONS AMENDING AMENDING DEFINITIONh01/
'SALARY "; AMENDING SECTION 6 BENIHI
AMOUNTS AND ELIGIBILITY; AMENDING '
TION 9 VESTING' AMENDING SECTION 20 0E.
FERRO RETIREMENT OPTION PLAN; PR01•0.10
FOR SE'IERABILITY OF PROVISIONS' REPS'0ii.,;
Alt r :OINANCES IN CONFLICT HEI;EWI'4 Part
9004' ( NG AN EFFECTIVE DATE.
I f n , : rson decides to appeal any ,1 r:
ode by the above City Co r1
Sit'r th respect t0 any matter
,, o; such hearing, they will r
recc of the proceedings, and
such purpose they may need to en -Ora
thot a verbatim record of the proceed
:nys is made, which record include,
the testimony and evidence upon
whi h the appeal is 10 be based
^'1 ,i..: ested parties are invited TO
d be heard with respect ,o
!
In accordance with the A _r
cans with Disabilities Act, pe.
needing a special accommodatic,, n
an interpreter t0 participate in this
proceeding should contact the City
Clerk's office at 407- 905 -3105 at least 46
hours prior to the date of hearing.
Bet`: _h -reel rr
OL:.1 ..r( 0'3'30/2012