08-09-1995 Minutes JOINT MEETING
GENERAL EMPLOYEES' /POLICE OFFICERS' /FIREFIGHTERS' PENSION BOARDS
'r..r August 9, 1995
Chairman Reed called the Police Officers /Firefighters' Pension Board to order at 11:05 a.m. in
the Commission Chamber Conference Room of City Hall, and a quorum was declared present.
PRESENT: Chairman Reed, Members Gledich, Strosnider, Williams, and Wilson. Also present
were Actuary Garrett, Attorney Delmer, Money Manager Ballew, and
Clerk/Stenographer Lewis.
ABSENT: None.
Acting Chairman Grafton called the General Employees' Pension Board back to order.
PRESENT: Acting Chairman Grafton, Members Dabbs, Oliver, and Waldrop.
REPORTS
ATTORNEY
ACTUARY AGREEMENTS /MONITOR AGREEMENTS - Attorney Dehner explained details
in the Monitor Agreement and also the Actuary Agreement that were common to both Boards.
There were things in the Police /Fire agreements that did not apply to the General Plan, and he
would discuss those during the Police /Fire meeting. He had spoken with Actuary Foster who had
*ftw• over their agreements and he did not anticipate any problem. Mr. Dehner said that Actuary Foster
had informed him that the contracts were fine. Mr. Foster was away from the office at that time
and he had asked if there would be any problem from the Board's, upon returning, about signing
the Affidavit. The contracts reflect the agreement that the Plans had been working under with
Foster & Foster, Inc. and Attorney Delmer would send those back to the Boards for signatures once
Actuary Foster had signed them.
ATTORNEY AGREEMENTS - Attorney Dehner presented two copies of an agreement with
Christiansen & Delmer, his firm, for each of the Boards. He said that the agreements reduced to
writing the on -going relationship that the Attorney /Board had held in the past.
Member Strosnider. seconded by Member Gledich, moved to accept the Agreement for the
Investment Performance Monitoring and the Advisory Services (Actuarial Services Agreement) with
Foster & Foster, Inc. and the City of Ocoee Police Officers' /Firefighters' Retirement Trust Fund
as presented. Motion carried 5 -0.
In response to Member Waldrop, Attorney Dehner explained that the Board and the consultant,
as fiduciaries, could terminate the contract which provides for a termination period upon 30 days
notice. The three year fee guarantee was only a record and representation that if the consultant is
with the Plan for three years. It was basically a contract from month to month. Member Waldrop
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The Joint Meeting of the City of Ocoee General Employees' and
Police Officers' /Firefighters' Retirement Trust Boards
* ow. August 9, 1995
stated that he had no problems with the attorney but would object to being locked in with a three
year contract. Attorney Dehner said that the consultant is locked in for that fee for that period of
time, should they remain.
Member Waldrop, seconded by Member Dabbs moved to accept the Agreement for the
Investment Performance Monitorin . and the Adviso Services Actuarial Services A ' reement with
Foster & Foster Inc. and the Ci of Ocoee General Em lo ees' Retirement Trust Fund as
presented. Motion carried 4 -0.,
Member Oliver, seconded by Member Dabbs moved to acce. t the Attorne . Contract with
Christiansen & Dehner, P.A. as presented. Motion carried 4 -0.
Chairman Reed said that the Police /Fire Board would vote on their Contract with the attorney
during their Board meeting.
AT THE REQUEST OF MONITOR GARRETT, CHAIRMAN REED RECOMMENDED
THAT REPORTS FROM SUNBANK BE GIVEN AT THIS TIME DURING THE MEETING.
MONEY MANAGER
Brian Ballew, SunBank representative, said that the figures might differ between the quarterly
report and the six month ending. He distributed The Investment Reports, and said that the financial
markets continue to respond favorably to the economic conditions that existed in the second quarter.
It had been one of the best quarters in the stock market in two and one -half years but we were at
somewhat of a plateau stage. The economy was slowing down and they were getting a mixed bag
of indicators from the government. The Federal Reserve had lowered the Federal Funds rated
quarter point to hopefully stimulate the economy. They had been trying to engineer the so called
"soft landing" over the last 12 months, and for the most part it had worked. Another easing might
be seen in September. He said that they would continue to watch the data but the bond and stock
markets have had terrific runs for the first six months of '95. The Funds had benefited. The
returns in terms of real returns were fantastic, and they had made a lot of money. It had been tough
to beat the indexes. Through the first quarter of 1995, the S &P index ranked around the 9th
percentile and it had out performed 91% of domestic stock, mutual fund and portfolio managers.
Through June it had still been 83 % of domestic stock of their mutual portfolio managers. It had
been a tough bench mark to beat.
Money Manager Ballew presented a chart of the "S &P 500: Relative Performance By Sector" as
of June 30, 1995. The chart showed which sectors had out performed the market (the S &P Index)
as a whole through the six month period ending June, 1995.
Chairman Reed left at 11:32 A.M. and returns to the meeting at 11:35 A.M.
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The Joint Meeting of the City of Ocoee General Employees' and
Police Officers' /Firefighters' Retirement Trust Boards
r `" August 9, 1995
Mr. Ballew said that the markets had done remarkably well. The bond fund was lagging in the
index. The bond funds, historically and financially, will continue to have a good quarter in this six
months in terms of real returns. Mr. Ballew asked for the patience of the Boards as they continue
working to beat those indexes.
Money Manager Ballew presented the Investment Performance Report of the General Employees'
Fund, and said that the terms of the plan was 6.2% with an asset allocation of roughly 60% fixed
income, 40% equities, and a little cash. As of August 1, 1995 nearly all the individual stock had
been sold. The equity fund and the equity income funds, both did roughly 6.5% for the quarter,
and the S &P soared at 9.5%. The Bond Fund had been up 6.13% versus Lehman Brothers Bond
Index at 6.48%, and had lagged by about 40 basis points. For the six month period, the Equity
Fund had been up 16.5%, the Equity Income Fund up 18.3% with an S &P up 20%. The market
had been up 20% for the six month period ending in June. Mr. Ballew said that although they were
great returns, that we had still been beaten by the S &P 500. The Bond Fund had been up to
10.85% versus the Index of 11.8%.
The report also included a reconciliation of the account for the quarter ending in June, and a
Cumulative Investment Performance for the period ending also in June. Mr. Ballew said that he
expects the momentum holding in the first half of '96, and he also thinks that the stock prices will
go higher in '96. He explained how the weight in the High Grade Bond Fund was changing, and
that the High Rate Equity Fund were over weighted in technology relative to the S &P as of June 30.
Drug stocks, health care, and retail were doing well. Industry chart showed how the Fund matched
up versus the S &P as to the weighing and gave a complete list of assets in the Funds.
Money Manager Ballew presented the Investment Performance Report of the Police /Fire Fund, and
said that the numbers were virtually identical.
MONITOR
Monitor Garrett of Foster & Foster, said that they had matched up well with SunBank. Time had
resolved some of the earlier differences. Mr. Garrett said that the Monitor's returns were a little
higher than SunBank's, and he presented Mr. Ballew with a written report for SunBank. He said
that there was a point of deception on the chart presented in the report for periods prior to 12/94.
The Monitor's races of history had the over lapping period between ICC and when SunBank had
taken over but they were now monitoring only SunBank's performance. The Board could request
a work up of how the Fund had done over five years in the dollar weighing and total returns. He
said that the Fund had done well. The last quarter showed long term rate returns with SunBank and
ICC. The report was for a lot shorter time period. Mr. Garrett presented an analysis of the
investment performances of both of the Retirement Trust Funds for the period January 1, 1995
through June 30, 1995.
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The Joint Meeting of the City of Ocoee General Employees' and
Police Officers' /Firefighters' Retirement Trust Boards
.► August 9, 1995
PERFORMANCE REPORT - GENERAL EMPLOYEES' FUND
Monitor Garrett reported that the rate of return for the quarter was 6.3%. This rate of return
failed to outperform the composite index of market indicators (40% S &P 500 Composite Stock
Index, 55% Lehman Brothers Government/Corporate Bond Index, and 5% U.S. Treasury Bills)
which also registered a return of 7.4%. This rate of return was ranked in the 57th percentile of the
Cadence Universe of investment managers.
The equity portion of the Fund underperformed the S &P 500 over the latest quarter (7.0% vs.
9.5%) and ranked in the 72nd percentile of the Cadence Universe.
PERFORMANCE REPORT - POLICE OFFICERS' /FIREFIGHTERS' FUND
Monitor Garrett reported that the rate of return for the quarter was 6.3%. This rate of return
failed to ourperform the composite index of market indicators (40 % S &P 500 Composite Stock
Index, 55 % Lehman Brothers Government/Corporate Bond Index, and 5% U.S. Treasury Bills)
which registered a return of 7.4 %. This rate of return ranked in the 57th percentile of the Cadence
Universe of investment managers.
The equity portion of the Fund underperformed the S &P 500 over the latest quarter (6.8 % vs.
9.5%). This performance ranked in the 72nd percentile of the Cadence Universe of investment
managers.
ASSET ALLOCATIONS
Actuary Garrett presented a chart for the Boards to review, and said that most of their clients had
moved to a higher equity allocation. The chart showed levels of volatility as measured in standard
returns and associated with different asset allocations. The Policy Statement must also be changed
if the Board decided to change the asset allocation. Attorney Dehner said that the ordinance for
the General Employees Fund and the Police /Fire Fund gave the same restrictions for the money
manager and the actuary. Discussion also ensued on changing the General Employees ordinance
to allow their Fund to go into international investments as they do not have the same quality
standards. Mr. Dehner asked for input from the money manger about international investment.
Money Manager Ballew said that he believed that it was an excellent idea, and explained some of
the risks in going to international. He stated that the timing would not be bad now either as the
U.S. markets are the place to be in the world for the first six months of '95. Mr. Ballew
recommended some international exposure, and said that it reduced the risk and could add to the
Fund's returns. There were a lot of opportunities abroad and we were truly coming to a global
economy. He also recommended participation in growth companies that were already abroad.
Actuary Garrett said that they saw it as another avenue in further diversification. He explained
that their top performing client is a general employee fund that had gone with 20% of the total fund
into international, typically holding less than that, and that has had an outstanding return. They
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The Joint Meeting of the City of Ocoee General Employees' and
Police Officers' /Firefighters' Retirement Trust Boards
August 9, 1995
were a little more aggressive on the other equities as far as the restricted. Mr. Garrett supported
the change and said that the ordinance would need changing to include the international piece, and
the equity allocation.
In response to Chairman Grafton, Attorney Dehner said that it had been highly recommended by
both of the investment advisors, and asked that Mr. Ballew provide the packages for further
consideration of the Boards. He said that it was important to make the distinction between the two
different potential changes being discussed, as follows:
1) Increasing the asset allocation to 50% by Board action amending the Investment Policy
Statement. The current ordinance already gave the authority to legally go as high as 50 %.
2) The changes that would be required enabling the Fund to legally go into international or
some quality below the top three rating classification would require an ordinance change
before the Board could change the Investment Policy.
Actuary Garrett asked if there was a fund already tailored for international (at SunBank), and if
they were developed in U.S. dollars, or if there was a currency risk. Mr. Ballew said there were
currency risks, and that it was currently just a common trust fund that will ultimately become a
mutual fund. There is currency exposure and it was typically a "unhedged" international fund.
They will employ some hedging, seizing a steady trend of the dollar strengthening or weakening as
it will definitely affect the returns. It more or less forecast the dollar to just kind of bounce around.
Chairman Grafton wanted the General Employees' Board to review the asset allocations and their
investment policy once again, and asked that the Board reconsider it at the September 14 meeting.
Member Oliver said that she had asked Mr. Ballew to send the information to her for distribution.
Member Dabbs stated that he and his family had foreign funds, and said that he believed that it
merits discussion.
In response to Actuary Garrett, Mr. Ballew said that none of funds were loaded for any of their
plans. It was just compost funds, individual spanning investment. The current recommended asset
allocation to a plan or a plan that wants to accept some international is roughly 10% of the equity
exposure. If the Board decided to move to 50% equities, SunBank would recommend 10% of that
or 5% of your total portfolio to be international. There would be no dramatic shift. Chairman
Grafton expressed concern about the Plan remaining sound. Member Dabbs emphasized that the
Board had a responsibility to do the best that it could and to look at all of the options without
"selling the farm."
Member Dabbs left the meeting at 12:09 p.m.
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The Joint Meeting of the City of Ocoee General Employees' and
Police Officers' /Firefighters' Retirement Trust Boards
August 9, 1995
Actuary Garrett said that the Board could go ahead and consider the change in the equity
allocations and discuss the international part later. Chairman Grafton said that she would really
rather wait until Tanya Miller could be present.
Chairman Reed opened the Police /Fire Board to a discussion into leaving the allocations the same
or going to 50 -50. He explained that the Plan had made an increase over a year ago, and he said
that he believed that it had been a mistake. He then asked how much of an advantage would it be
to go 50 -50 over what they now were through 1996, and Mr. Ballew said that that was kind of a
short window. Mr. Ballew emphasized that the Board should think long term, 10 - 15 years, to
extend the benefit by having more equity exposure. He said that historically, there was no guarantee
but that they believed that over the long term that the Fund would do better with stocks.
Member Gledich expressed support in increasing the equity allocation to 50 % at cost within the
discretion of the manager to go there, that they were not directing the manager to 50% but they
were giving the manager the discretion to go as high as 50% at cost. In response to Member
Gledich, Attorney Dehner said that from a fiduciary standpoint the Board should look at where the
median level of this types of fund and administrator were in terms of asset allocation. The 50%
equity allocation is about the median 50 -52 %, in that range of equity investments, and if the Fund
gets below 35 they were in the 5th percentile on the low side. If they were above 65 in equity then
they were in the 5th percentile on the high side. As fiduciaries, if they were going to be in either
labor extreme, the Board wanted to have a good reason to be there, a record such as certain equity needs.
He said that he did not think that that was the circumstances of the Board. It was more comfortable
from the legal and fiduciary standpoint in terms of defending what you were doing if you play
around the median. The statistics that he quoted were still accurate, and from a legal and fiduciary
position he would be comfortable with that.
Member Gledich seconded by Member Williams moved that the Investment Policy of the Police
and Fire Board be amended with respect to the maximum e . ui ex . osure of cost to reflect the
increase from 40% to 50% that anv increase would be within the discretion of the mana • er and that
the Board is not tellin . the mana ' er to • o to 50% they're merel tellin m the manager the have the
discretion to ao to 50% e • uity in cost and that Chan' e is effective as of Au' st 8. 1995. Motion
carried 5 -0. The Board directed Foster & Foster, Inc. to make the appropriate changes in the Policy
Statement.
Actuary Garrett pointed out that the next quarter's Police /Fire Performance Report would show
the change in the index, and that they would show 50% S &P 500, 45 % Lehman Brothers Bond, and
5% cash. That would be in effect all the way to the 12th and they could not say that they were at
40% this period. There will be only two quarters of history and the rates would be down a little
bit.
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The Joint Meeting of the City of Ocoee General Employees' and
Police Officers' /Firefighters' Retirement Trust Boards
`.,, August 9, 1995
In response to Member Waldrop, Actuary Garrett explained that if the investments were good that
it could affect the portion paid by the City.
DISCUSSION OF TRAINING PROGRAM FOR EMPLOYEES ELIGIBLE TO RETIRE
Chairman Reed said that he believed there was a need for a retirees training program for people
eligible for early or normal retirement within the next five years. Chairman Grafton said that this
had been discussed during the General Employees meeting. She explained that Stenographer Lewis'
husband had recently retired and the retiree and spouse had been required to attend a series of
meetings covering a wide range of topics. She pointed out that Ms. Lewis had stated that it would
have been very helpful had they attended the meetings 20 years earlier. The General Board had
talked about setting up a series of lectures or programs for the entire membership, after working
hours, that would be open to the employee and their spouse. Discussion ensued about speakers,
materials, expense, publicity and promotion for such a seminar. A sample program was presented
to the Boards for review. MemberStrosnider seconded b Member Gledich moved that the
Trustees from Police /Fire Board and the General Em . to ees Board work to. ether to develo. a Pre -
retirement Seminar in early 1996. Motion carried 4 - Chairman Grafton said that the General
Employees Board had reached a consensus earlier.
ADJOURNMENT FOR THE GENERAL EMPLOYEES' PENSION BOARD
Chairman Grafton adjourned the General Employees' Pension Board at 12:34 p.m.
Now
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THE CITY OF OCOEE POLICE OFFICERS' /FIREFIGHTERS'
RETIREMENT TRUST FUND (PENSION BOARD MEETING) - August 9, 1995
Chairman Reed reconvened the Police Officers' /Firefighters' Pension Board at 12:36 p.m. and
declared a quorum.
PRESENT: Chairman Reed, Members Gledich, Strosnider, Wilson, and Williams. Also
present were Actuary Garrett, Attorney Delmer, and Clerk/Stenographer Lewis.
ABSENT: None
APPROVAL OF MINUTES
Member Gledich seconded by Member Strosnider moved to a • .rove the Minutes of the
Ma 8 1995 Police Officers /Firefi . hters' Retirement Trust Fund meetin ' as .resented. Motion
carried 5 -0.
QUESTIONS /COMMENTS FROM AUDIENCE
Billy Walker asked for a status report on the request that he had made during the last meeting.
Attorney Dehner explained that he believed they were close to a resolution in accordance with
action by the Board, that there were some requirements about funding reports involving the City,
and it was not a final answer. He said that he could not speak for the City. Actuary Garrett
said that it may require an ordinance change that would also require an impact statement.
Attorney Dehner said that if they were successful, the Actuary will need an Election of Benefits
`'' form. Mr. Walker thanked everyone for their help.
ORDINANCE NO. 95 - _, AMENDING ORDINANCE NO. 94
Attorney Christiansen reported that the Division of Retirement had changed their position about
some of the rulings. There were some differences between the Fire and the Police. The Board
must decide whether to treat both groups the same in each area, as follows:
1) A Re- employment Change in the Number of Years To Bridge Time - If the member who
left the employ of the Police Department should not be reemployed as a Police Officer
or Firefighter within five (5) years, then the accumulated contributions will be returned
upon the member's written request. It was a decision for the Board to make but he
recommended deleting the three (3) years for both. The Board could keep the three (3)
year retirement requirement for Fire after reemployment but they must delete it from the
Police. There is a difference in the language between (Chapters) 175 for Firefighters
Statute and 185 for Police Officers, and the Division's interpretation of that language.
(Page 2 of the ordinance.)
2) Ninety (90) Day Buy Back Provision - The provision change is required for the
Firefighters but not for the Police Officers in (last sentence on page 2, first paragraph)
that a member leaves and takes the money out, and they are reemployed within 90 days
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Police Officers' /Firefighters' Retirement Trust Fund
August 9, 1995
of the reemployment, the member can buy his past service time by returning the
contributions, with interest, as provided at the actuarial assumed rate. The Board has
two choices there for interest: 1) At the actuarial assumed rate, or 2) the rate that the
investments actually earned during the period of time involved. There can be one
provision in the Plan for Police Officers and another for the Fire. Attorney Dehner said
that he was not suggesting that they change it but the mandate applies only to the
Firefighters.
Discussion ensued on whether to amend the credited service definition, to provide the buy back
for Police Officers at no cost to the Fund. Attorney Dehner said no direction was needed at
this point, that there will be another meeting before the final draft with the changes. It should
be in this calendar year. He said that they had no mandates from the State on the buy back for
Police Officers so they could allow for a greater time period, and to allow the buy back from
the time they are reemployed. In some Plans, for Firefighters even, for an employee that comes
back and lets the 90 days go by, the Board could provide a buy back for him beyond the 90
days. The Board could clearly do that at no cost to the Fund. The State mandate is only with
respect to that 90 day period.
Attorney Dehner suggested that the Plan go with 12 months at no cost to the Fund. He said
that the State mandates they can do the 90 days with interest for the Fire, but Police it does not
apply to. Also, the 12 month is no cost to the Fund and is credited for all purposes including
' vesting. Actuary Garrett said that since it is prior service, as their job titles are, it is not like
military buy back time which should never count toward vesting. If anyone is going to buy it
back, it will be the retirement benefit that they get at normal retirement. But fire service to the
Fire Department, to the same City, would be credited toward vesting if the member is paying
for it.
Attorney Dehner said that in the event that the Division should change their position again on
the requirement for contributions with interest, posing no cost to the Fund (or we find that it's
not really being vigorously enforced) that it would enable us to apply no cost to the Fund even
for that 90 days for Firefighters with interest and strike out at the actuarily assumed rate. The
Board could then consider adopting as part of the Rules and Procedures a rule that refers to this
buy back section and provide, to the extent provided by law, interest shall be the higher of the
1) assumed rate, 2) the investment return rate or 3) the actuarily calculated amount. The Board
would be in a position between the language and the ordinance, should the Division change their
position that only states with interest, of placing together with our Rules, stating how interest
is going to be determined by the Board to be the higher of those three.
3) Chapter 175 and Chapter 185 - Attorney Dehner said that the Division's interpretation
on the military situation had changed, and it has mandated a difference between Police
and Fire based on the language of Chapters 175 and 185. The change refers only to the
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Police Officers' /Firefighters' Retirement Trust Fund
August 9, 1995
Police. He said that if someone is employed, leaves employment, goes into the military
training, comes back, and they want that military time as accredited service in the Plan
that the Board could decide that a Firefighter returning from military service has to put
the contributions back in that they would have made had they been working here, rather
than just getting it given to them, and in order to get that time as credited service in the
Plan.
Chapter 185 did not mention contributions for the Police Officers' and the Division has
taken a change in that position. Attorney Dehner said that if a Police Officer goes into
the military and comes back, the Plan will credit the time upon the return in accordance
with what they are permitted and required to do under State and Federal law.
Attorney Dehner said that the Uniform Services Provision must be spelled out to make clear
that Firefighters must make contribution and to include that in the ordinance. It is different for
the Police Officers and he recommended the required or permitted language in the ordinance
and then address in the Rules the reference to the military situation with Police Officers. It was
similar to the interest of the Firefighters putting in to the Rules a provision stating "to the extent
permitted by law, that these shall be the regulations with respect to police buying back their
military time." Should the Department back off, a basis would be in place in a situation to
charge the Police Officer the same as a Firefighter, which would be contributions that he would
have made had he been working here during that period of service rather than being in the
`' military. In response to Chairman Reed, Attorney Dehner said that was only the
contributions, without the interest. He said that under the new legislation, we were no longer
allowed to compute interest but we were allowed to put a cap on it. The cap is two times the
period of actual service up to a maximum of five (5) years. (If you have an employee who is
gone two years, three times two would be six years, or he would be at the five year cap so that
person must put his money in within five years.) The cap is needed to protect the Fund.
Claims Procedure - Attorney Dehner explained difficulties with the Claims Procedure, and he
said that they were finding that it was taking longer to get IME's setup and medical reports out
of the medical providers, and that it had become necessary to make changes with the Rules. 1'Ir.
Dehner said that the changes were happening with such increasing frequency that he
recommended placing specific rules into the Operating Rules and Procedures rather than in the
ordinance. He said that if the Board was in agreement with that, then he would add a paragraph
in reference to that in the Claims Section of the ordinance.
Attorney Dehner stated that an amendment adding Section 112.181 to the Statutes had narrowly
passed both Houses this session. He recommended placing the language into the ordinance so
that all Plan members were aware of it. It was an additional condition on which a disability
claim can be based and a member can claim the benefit of an in- line -of -duty rebuttable
presumption. The amendment applies to the Plan. He said that up until this time, we have had
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Police Officers' /Firefighters' Retirement Trust Fund
August 9, 1995
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a rebuttable presumption of in- line -of -duty disability if the claim were based on heart disease,
hypertension, and tuberculosis. The current presumption condition is that if there was a physical
exam which included a cardiogram upon employment, that those requirements were met, and
if somebody filed a claim with the Plan then they could enter the benefit of presumption.
Mr. Dehner reported on the method that the presumption worked and the causation of an in-
line -of -duty or not in- line -of -duty. If it was not in- line -of -duty, you must work 10 years to your
entitlement for that, and if it is in- line -of -duty, then you had day one coverage. The causation
is significant from an entitlement standpoint. The next issue was significant from a level of
benefits standpoint. If it were based on heart disease and the employee proves that he is not
only permanently disabled, but also the effect of that presumption kicking in is that the burden
of proof on the issue shifts, the claimant must prove to the Board that it happened in- line -of-
duty. The Board has to prove that it was not in- line -of -duty, if the Board is not going to grant
him an in- line -of -duty benefit. The burden falls on the Board to prove some course of evidence
that his heart disease, his disability, was not incurred as the result of performance of duty. The
second thing that occurs is that there is a higher standard of proof when that burden shifts to the
Board with presumption. It must be proved by more than just by the greater weight of evidence,
but rather by claiming convincing evidence which lies between the criminal standard of beyond
a reasonable doubt and the civil standard of evaluating the evidence.
The new presumption bill has expanded on the conditions of the many infectious diseases that
are covered now by a presumption, and includes among others, hepatitis A, hepatitis B, hepatitis
I, hepatitis non -B, one type of menegitis, hepatitis C, tuberculosis. It is effective and applies
only as to those conditions that are diagnosed after January 1, 1996.
As there are additional conditions beyond the current, Plan members should be given Notice of
the Bill. He recommended distribution to the members as soon as possible so that they can read
and know the requirements. In order for a member to claim the benefit of this presumption he
must have had a base line of negative established somewhere prior to that date.
The City may test but is not required to test for these things. Attorney Dehner said that he
wanted the Plan members to know to the extent there are some diseases covered that they aren't
being tested for, that if they want to claim the potential of presumption sometime, that the
burden is on them, that the expense is on them to get tested for those diseases so they have a
negative base line.
There is one additional requirement under this presumption that the Plan did not have under the
other presumption. A member will be required to file a written notification with the City if they
have incurred a situation where they have reason to believe they may have come into contact
with somebody that may have passed one of the infectious diseases on to them. Chief
Strosnider said that they were already required to do that. Attorney Dehner said that he
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Police Officers' /Firefighters' Retirement Trust Fund
August 9, 1995
wanted to be sure that the members know two requirements that are placed on them and he
wanted it in the ordinance for that reason. Also, when a claim is filed, that it is an important
part of the judication procedure and it is an issue of the Board. Issues needed to determine
entitlement: 1) a filed written notification of an exposure, and 2) a negative baseline.
Attorney Dehner distributed a copy of the Statute for the Board to review. In summary, he said
that after January 1, 1996, if they are diagnosed with one of these conditions and an employee
files a disability based on it, and claim this benefit, that they must have the base line established,
and the employee has filed the written report. The Summary Plan Description must be
amended, once the ordinance has passed, to include a notice that a new employee will be
informed of Section 112.181 of the Florida Statutes. Current Plan members will also have the
opportunity to see the change.
Chairman Reed said that he will do a cover letter for this to distribute copies to the members.
OTHER BUSINESS
ELECTIONS
Chairman Reed read the Notice of the election and gave the dates for voting. Member
Strosnider's term was expiring. Nomination must be received no later than September 5, 1995
and ballots will be counted and certified at the September 26, 1995 Special Police
Officers' /Firefighters Pension Board meeting.
AGREEMENT FOR LEGAL SERVICES
The Agreement For Legal Services with Christiansen and Dehner had been explained during the
Joint Board Meeting. Member Strosnider seconded b Member Williams moved to acce et
the A . reement For Le al Services with Christiansen and Dehner P.A. and the Ci of Ocoee
Police Officers' /Firefighters' Pension Board as presented. Motion carried 5 -0.
ASSET ALLOCATION CHANGES - THIS ITEM HAD BEEN DISCUSSED DURING THE
JOINT BOARD MEETING
DISCUSSION OF BENEFIT IMPROVEMENTS
Chairman Reed distributed an August 9, 1995 memorandum regarding a special actuarial study
for the Board to review the impact to required contributions of various benefit improvements.
Actuary Garrett explained that the Board had requested a study if improvements considered are
an increase in the benefit rate from 2.5% to 2.75 % per year of credit service and providing
current and future retirees with an $100 per month benefit supplement.
In response to Chairman Reed, Attorney Garrett said that the General Employees Board had
met with the City Manager regarding benefit improvements and that the initial component from
the General Employees was to increase the accrual rate from 2% to 2.5%. That didn't find
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Police Officers' /Firefighters' Retirement Trust Fund
August 9, 1995
favor, and they went back with a request to a 2.2% increase which is currently with the City,
although the City Manager is recommending against that at this time.
Chairman Reed said that he wanted to let the City know in early 1996 that the Board is very
committed to increasing the benefit rate. Attorney Dehner said that they could start the
process, and let the City know the Board's recommendation in terms of the improvements. They
could indicate that while these are the costs figures based on the 1994 valuation, that we
anticipate that more favorable figures are anticipated for 1995. We may have that before the
process is over. Actuary Garrett said that this was a possibility. Also, if the Board asked the
City as far as the funding floor in the ordinance of 17.5% which they were currently funding,
that if they were comfortable with funding 17.5 % history, that Foster and Foster could work a
10/95 valuation with the actuarial assumption which meant, as a whole, that funding would be
17.5% forever. Attorney Dehner suggested that the Board take their recommendation to the
membership for confirmation before presenting it to the City. Member Gledich said that the
members really want this.
Discussion ensued regarding a regular meeting and reconvening to a meeting with the
membership. Chairman Reed said that he would have to get with General to see if they would
be in agreement to changing their November meeting date.
Attorney Dehner asked if the Board would decide later about the early retirement issue and
`�..• when the $100 supplement begins or based upon the discussion if that would begin at the
otherwise normal retirement age. Chairman Reed suggest that the Board discuss this a little
bit further. Actuary Garrett said that he supported going with those numbers for the average
date of the normal retirement date for early retirees. They were eligible for it but it was not
payable until the normal retirement date. He said it was not going to make a huge difference
on that amount of liability. He would not make a change to have that payable to early retirees
at early retirement. Attorney Dehner said that he understood that Actuary Garrett was saying
that the Board wanted to make it payable at early retirement, that it was going to increase those
numbers (or what the new numbers are going to be in the new valuation). He was not sure it
was worth while to have Actuary Garrett doing a computation increase as the numbers due to
the proposal may change. These were based under the '94 valuation. He suggested asking
Actuary Garrett, based on the '95 valuation, to do numbers, applying the $100 in at normal
retirement, early retirees, and then applying it in at the early retirement date. He said then you
can see the difference in the numbers on the new valuation.
Chairman Reed said that there had been a big turn over in the Police Department, and asked
if the Board was required to get written notification from a terminated employee, who was
vested, on what they wish to do with their contributions. Attorney Delmer said that the money
is left in until the Board receives a written request. A non - vested member who terminates must
do the same thing. There is no benefit in leaving the money as interest is not paid on the
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Police Officers' /Firefighters' Retirement Trust Fund
August 9, 1995
contributions if it goes past the 5 years of re- employment.
Member Wilson left at 1:52 p.m. and returned at 1:54 p.m.
AUTHORIZATION FOR PAYMENT OF BILLS
Member Gledich, seconded b Member Williams moved to ratify oa ment of the outstandin•
bills. Motion carried 5 -0.
ADJOURNMENT
Member Gledich seconded b Member Williams moved to ad'ourn the meetin • at 2:20 • .m.
Motion carried 5 -0. — _ --
Respectfully submitted,
Judie Lewis, Clerk/Stenographer
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