HomeMy WebLinkAboutItem #05 Change to General Employees Retirement Trust Fund
AGENDA ITEM COVER SHEET
Meeting Date: 11/21/06
Item #
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Reviewed By: ~~
Department Director: _ /- ~~
City Manager: _ _ ___
Contact Name:
Contact Number:
James Carnicella
1032
Background Summary:
The Pension Board for the City of Ocoee Municipal General Employees' Retirement Trust Fund is governed
by ordinance.
Issue:
Amendment to the General Employees' Pension Ordinance to change the multiplier from 2.5% to 3%. This
issue was approved by the General Employees' Pension Board and the Employee Committee. Furthermore,
the issue was discussed at the budget workshops and staffwas directed to return with a recommendation.
Recommendations
Staff recommends the Commission adopt the Pension Board changes as amended in the attached ordinance
for the City of Ocoee General Employees' Retirement Trust Fund first reading.
Attachm~nts:
Attached is the Ordinance pertaining to the recommended change.
Financial Impact:
The Actuarial Impact Statement prepared for the Pension Board by Foster & Foster, the General Employees'
Pension Actuary, is attached. Though there is no financial impact for FY 07, the City's contribution to fund
this change will be approximately 15% of payroll in FY 09. The City's contribution rate for FY 07 is 11.0%
Type of Item:
[8J Public Hearing
D Ordinance First Reading
D Ordinance First Reading
D Resolution
D Commission Approval
D Discussion & Direction
For Clerk's Deot Use:
D Consent Agenda
D Public Hearing
D Regular Agenda
o Original Document/Contract Attached for Execution by City Clerk
o Original Document/Contract Held by Department for Execution
Reviewed by City Attorney
Reviewed by Finance Dept.
Reviewed by ( )
D N/A
D N/A
D N/A
ORDINANCE NO. 20-
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 96-19; AS SUBSEQUENTLY AMENDED;
AMENDING SECTION 6, BENEFIT AMOUNTS AND
ELIGIBILITY; 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. 96-19, adopting the amended and restated City of
Ocoee Municipal General Employees' Retirement Trust Fund, is hereby amended by
amending Section 6, Benefit Amounts and Eligibility, subsection 2, Normal Retirement Benefit,
to read as follows:
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2. Normal Retirement Benefit.
A Member 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 ollc-l1a:lfpclccllt (2.5%) three percent (3%) of Average
Final Compensation, for each year of Credited Service.
SECTION 3. Repeal of Ordinances. All ordinances or parts of ordinances in conflict
herewith are hereby repealed.
SECTION 4. Effective Date. This ordinance shall take effect on October 1. 2006.
PASSED AND ADOPTED this _ day of
, 2006.
By:
S. Scott Vandergrift, Mayor
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ATTEST:
APPROVED:
CITY OF OCOEE, FLORIDA
Beth Eikenberry, City Clerk
(SEAL)
ADVERTISED ,2006
READ FIRST TIME , 2006
READ SECOND TIME AND ADOPTED
, 2006
FOR USE AND RELIANCE ONLY BY
THE CITY OF OCOEE, FLORIDA
APPROVED AS TO FORM AND LEGALITY
THIS _ day of ,2006
CHRISTIANSEN & DEHNER, P.A.
Special Counsel
By:
noclocoeelgeuIOS.19-06.ord
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APPROVED BY THE OCOEE CITY
COMMISSION AT A MEETING HELD
ON ,2006 UNDER AGENDA
ITEM NO.
CITY OF OCOEE
MUNICIPAL GENERAL EMPLOYEES'
RETIREMENT TRUST FUND
ACTUARIAL IMPACT STATEMENT - TWO
BENEFIT RATE INCREASE
August 28, 2006
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 change:
1) Increase the benefit accrual rate for all years of Credited Service for Members
terminating employment on or after the effective date from 2.50% to 3.00%. The
rate increase does not apply to Members who elect to retire under the proposed
Early Retirement Incentive program.
The cost impact, determined as of October 1, 2005, as applicable to the plan/fiscal year
ending September 30,2007, is as follows: .
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Current Proposed
Total Required Contribution $1,089,641 $1,396,831
% of Total Annual Payroll 17.5% 22.4%
Expected Member Cant. 461,671 461,671
Balance From City 627,970 935,160
% of Total Annual Payroll 10.1% 15.0%
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The changes presented herein are in compliance with Part VII, Chapter 112, Florida
Statutes and Section , Article X of he State Constitution.
STATEMENT OF PLAN ADMINISTRATOR
The prepared information presented herein reflects the estimated cost of the
proposed improvement.
Chairman, Board of Trustees
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Comparative Summary of Principal Valuation Results I
Before After I
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10/1/05 10/1/05
A. Participant Data I
Actives 157 157 I
Service Retirees 29' 29 I
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Beneficiaries 4 4 !
Terminated Vested 27 27 I
Disability Retirees 0 0 I
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Total 217 217 L
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Total Annual Payroll $5,885,653 $5,885,653 t-
Payroll Under Assumed Ret. Age 5,885,653 5,885,653 !
Annual Rate of Payments to: i
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Service Retirees 452,547 452,547 I
Beneficiaries 18,790 18,790
Terminated Vested 256,658 256,658
Disability Retirees 0 0
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B. Assets I
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Actuarial Value 11,741,104 11,741,104 I
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Market Value 12,032,055 12,032,055
C. Liabilities I
Present Value of Benefits r
Active Members
Retirement Benefits 13,956,437 16,423,078 !
Disability Benefits 0 0 I
Death Benefits 300,525 355,595
Vested Benefits 711,431 890,954
Refund of Contributions 417,465 384,171
Service Retirees 4,307,252 4,307,252
Beneficiaries 142,954 142,954
Terminated Vested 1,007,976 1,007,976
Disability Retirees 0 0
Excess State Monies Reserve 0 0
--------- -------------
Total 20,844,040 23,511,980
Before After
10/1/05 10/1/05
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C. Liabilities - (Continued) i
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Liabilities Due and Unpaid $0 $0 f
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Present Value Fut Salaries (AA) 46,361,400 46,361,400 I
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Present Value Fut Salaries (EA) 48,206,200 48,206,200 !
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Present Value of Future I
Member Contributions 3,430,744 3,430,744 !
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Present Value of Future I
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Normal Costs (Entry Age) 5,350,751 6,435,024
Actuarial Accrued Liability 15,493,289 17,076,956
Unfunded Actuarial Accrued 3,752,185 5,335,852 I
Liability (UAAL) I
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D. Actuarial Present Value of Accrued Benefits f
Vested Accrued Benefits i
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Inactives 5,458,182 5,458,182 ,
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Actives 2,438,680 3,140,261 I
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Member Contributions 2,191,683 2,191,683 I
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Total 10,088,545 10,790,126
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Non-vested Accrued Benefits 113,749 259,373 I
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Total Present Value Accrued 10,202,294 11,049,499 I
Benefits
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Increase (Decrease) in Present Value of [-
Accrued Benefits Attributable to:
Plan Amendments $847,205
Assumption Changes 0
New Accrued Benefits 0
Benefits Paid 0
Interest 0
Other 0
-----------
$847,205
Before After
10/1/05 10/1/05
E. Pension Cost
Normal Cost (with interest) $855,142 $1,077,327
% of Total Annual Payroll* 13.7 17.3
Payment Required to Amortize
Unfunded Actuarial Accrued
Liability over 30 years
(as of 10/1/05) 234,499 319,504 i
% of Total Annual Payroll* 3.8 5.1 r
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Total Required Contribution 1,089,641 1,396,831 f
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% of Total Annual Payroll* 17.5 22.4 I
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Expected Member Contributions 461,671 461,671
% of Total Annual Payroll* 7.4 7.4
Expected City Contribution 627,970 935,160
% of Total Annual Payroll* 10.1 15.0
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* Contributions developed as of 10/1/2005 are expressed as a percentage of projected
payroll at 10/1/2006 of: $6,238,792
OlP J?- 3
Copy of Public Hearing Advertisement
Date Published
ovlcn~ do ~t\\\l \1{ I
C(aS5;{~1ed~ D~ i 5l!ndCAj, NoVQ,.\t1~cr 12-, 'WO~
Advertisement
CITY Of DCDEE .
PUBUC HEARING
A Public H.aring before the
Dc... City C...mlni.. will be
held TuesdaY, November 21,
2006, at 7:15 p.m. or os soon
me~fi~f1~~r:\~r.~ro~ ~fig~:
bers of City Hall at 150
North Lakeshore Drive,
Ocoee, Florida, to consider
the following:
If a person decides to ap-
peal 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 verba-
1~~s ri~c~~d~~ ~~ld:r~~~g~d
includes the testimony and
evidence upon which the ap-
peal is to be based.
Ali interested parties are in-
vited to attend and be heard
with respect to the above.
I n accordance with the A-
mericans with Disabilities
Act. persons needing a spe-
~ial accommodation or an
mterpreter to participate in
1~~1 '1h~cI:l~~n~I~~~~ldofW~~
at 407-905-3105 at least two
days prior to the date of
hearing.
Beth Eikenberry
City Cierk
CORl13662 11/12/06