HomeMy WebLinkAboutDocumentation_Regular_Tab 06_03/14/2019 �, DA�Is �
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' AsHTON, �A.
Keith W. Davis, Esq.
Flondn Bni Board Certified Attorney
City,Coimty and Local Government Law
Email:keithQdavisashtonlaw.com
January 25, 2019
MEMORANDUM
To: Mayor Brennan; Vice Mayor Paterno; Council Members Arena, Brandon and
Johnson
Cc: Acting Manager Weinand, Clerk McWilliams; Building Official Rodriguez
Fr: Attorney Davis
Re: Defined Benefit Plan for Police Officers.
The following describes in detail the above referenced agenda item:
The proposed ordinance adopts revisions to the police pension plan in accordance with
recent negotiations regarding the defined benefits plan and receipt of "Chapter 185"
funds from the state.
701 Northpoint Parkzvay, Suite 205, West Palm Beach, FL 33407 � p 561-586-7116 � f 561-586-9611
www.davisashtonlaw.com
♦LEADING EXPERTS IN LOCAL GOVERNMENT LAW AND ETHICS♦
EXHIBIT "B"
VILLAGE OF TEQUESTA
PUBLIC SAFETY OFFICERS' PENSION TRUST FUND
TABLE OF CONTENTS
Section 1. Creation of Pension Trust Fund. ....................................................-1-
Section2. Definitions. ................................................................................................-1-
Section3. Membership. .............................................................................................-5-
Section 4. Board of Trustees. ....................................................................................-6-
Section 5. Finance And Fund Management. .............................................................-9-
Section 6. Contributions...........................................................................................-14-
Section 7. Benefit Amounts and Eligibility. ..............................................................-16-
Section 8. Pre-retirement Death. .............................................................................-19-
Section9. Disability. ................................................................................................-20-
Section 10. Monthly Supplemental Benefits. .............................................................-24-
Section11. Vesting....................................................................................................-24-
Section 12. Optional Forms of Benefits. ....................................................................-25-
Section 13. Beneficiaries. ..........................................................................................-28-
Section 14. Deferred Retirement Option Plan. ..........................................................-28-
Section 15. Claims Procedures Before the Board Decision. .....................................-30-
Section 16. Reports to Division of Retirement. ..........................................................-33-
Section 17. Roster of Retirees...................................................................................-34-
Section 18. Board Attorney and Professionals. ..............................................-34-
Section 19. Maximum Pension. ......................................................................-34-
00121944.RTF;1
Section 20. Commencement of Benefits.........................................................-35-
Section 21. Distribution of Benefits. ................................................................-36-
Section 22. Miscellaneous Provision. .............................................................-37-
Section 23. Repeal or Termination of System. ...............................................-39-
Section 24. Exemption from Execution, Non-assignability..............................-41-
Section 25. Pension Validity. ..........................................................................-42-
Section 26. Forfeiture of Pension....................................................................-42-
Section 27. Military Service Prior to Employment. ..........................................-44-
Section 28. Defined Contribution Component.................................................-44-
00121944.RTF;1
EXHIBIT "B"
VILLAGE OF TEQUESTA
PUBLIC SAFETY OFFICERS' PENSION TRUST FUND
Section 1. Creation of Pension Trust Fund.
The Village of Tequesta hereby creates and continues the Village of Tequesta
Public Safety Officers' Pension Trust Fund for the purpose of providing retirement,
death and disability benefits to Police Officers and Firefighters who are Members of this
Fund, certain former Village Police Officers and Firefighters and survivor benefits to
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'�^�{' ^'�^. Effective March 14. 2019. all assets of the Village of Tequesta Police
Officer Defined Contribution Pension Plan belonain4 to the transferred Members will
become assets of this S sv tem.
This System is intended to be a tax qualified plan under Code Section 401(a) and meet
the requirements of a governmental plan as defined by Code Section 414(d).
Section 2. Definitions.
1. Statement of Definitions. As used herein, unless otherwise defined or
required by the context, the following words and phrases shall have the meaning
indicated:
Accumulated Contributions means a Member's own contributions without
interest.
Actuarial Equivalent means a benefit or amount of equal value, based upon the
RP-2000 198 ortality table, and a 7.25% afl-��rate of interest. For
Plan Years beginning after December 31, 2002 for purposes of Code Section 415(b),
the mortality table is the table used under Code Section 417(e) as prescribed by the
Secretary of the Treasury in Rev. Rul. 2001-62.
Average Final Compensation shall mean one-twelfth (1/12) of the average salary
of the five (5) highest years of the last ten (10) years of credited service prior to
retirement, termination, or death or the career average as a full time Firefighter or Police
00121944.RTF;1
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Officer, whichever is greater. A year shall be twelve (12) consecutive months.
Beneficiary means the person or persons entitled to receive benefits hereunder
at the death of a Member who has or have been designated in writing by the Member
and filed with the Board. If no designation is in effect, or if no person so designated is
living, at the time of death of the Member, the beneficiary shall be the estate of the
Member.
Board or Board of Trustees mean the Public Safety Board of Trustees, which
shall administer and manage the System herein provided and serve as Trustees of the
Fund for the benefit of Village Police Officers and Firefighters and their beneficiaries.
Chapter means Chapter 175 and 185 of the Florida Statutes as amended from
time to time.
Code means the Internal Revenue Code of 1986, as amended from time to time.
Credited Service means the total number of years and fractional parts of years of
service as a Police Officer, or Firefighter who makes member contributions to the Plan,
omitting intervening years or fractional parts of years when such Police Officer or
Firefighter may not have been employed by the Village of Tequesta. A plan member
may voluntarily leave his/her contribution in the Fund for a period of five (5) years after
leaving the employ of the Village of Tequesta pending the possibility of being rehired in
a full time position by the Village of Tequesta without losing credit for the time of active
participation as a plan member. Should the employee not be re-employed with the
Village of Tequesta in a full time capacity within five (5) years, his/her contributions shall
be returned to him/her without interest. Should a Police Officer or Firefighter be
subsequently re-employed as such, he or she may re-purchase his or her years of credit
or fractional parts of years of credit by reimbursing such returned contribution to the
Fund, with interest.
The years or fractional parts of years that a Firefighter, or Police Officer serves in
the military service of the Armed Forces of the United States or the United States
Merchant Marine, voluntarily, upon being granted leave by the Village of Tequesta and
separation from employment as a Village of Tequesta plan member, shall be added to
his/her years of credited service for all purposes including vesting, provided that:
A. The Firefighter or Police Officer must return to his/her full time
employment with the Fire Department or Police Department within one (1)
year from the date of his/her military discharge in compliance with Code
Section 414(u), effective December 12, 1994. Effective January 1, 2007,
members who die or become disabled while serving on active duty military
service which intervenes the member's employment shall be entitled to the
rights of this section even though such member was not re-employed by
00121944.RTF;1
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the Village. Members who die or become disabled while on active duty
military service shall be treated as though re-employed the day before the
Member became disabled or died, was credited with the service they
would have been entitled to under this section, and then either died a
non-duty death while employed or became disabled from a non-duty
disability.
B. The maximum credit for military service shall be five (5) years.
Effective Date means the date on which this Ordinance becomes effective.
Fire Department means the Tequesta Fire Department.
Firefighter means an actively employed full-time person employed by the Fire
Department, including his/her initial p�obationary employment period, who is certified or
required to be certified as a Firefighter as a condition of employment in accordance with
the provisions of 633.35 Florida Statutes, including paramedic, and whose duty is to
extinguish fires, to protect life and to protect property. The term Firefighter includes all
certified, supervisory, and command personnel whose duties include, in whole or in
part, the supervision, training, guidance, and management responsibilities of full-time
firefighters, part-time firefighters, or auxiliary firefighters but does not include part-time
firefighters or auxiliary firefighters.
Fund or Pension Fund means the Trust Fund established herein as part of the
System.
Member means an actively employed Police Officer or Firefighter that fulfills the
applicable prescribed membership requirements
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Plan Year means the 12 month period beginning October 1 of each year and
ending the following September 30.
Police Department means the Tequesta Police Department.
Police Officer means any person who is elected, appointed, or employed full time
by the Village �e#o��ebfN'����, who is certified or required to be certified as a
law enforcement officer in compliance with Florida Statute 943.1395, who is vested with
authority to bear arms and make arrests, and whose primary responsibility is the
prevention and detection of crime or the enforcement of the penal, criminal, traffic or
highway laws of the state. This definition includes all certified supervisory and
command personnel whose duties include, in whole or in part, the supervision, training,
guidance, and management responsibilities of full-time law enforcement officers,
part-time law enforcement officers or auxiliary law enforcement officers as the same are
00121944.RTF;1
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defined in F.S. 943.10(6) and (8) respectively. Police Officer also shall include a public
safety officer who is responsible for performing both police and fire services. �e�ise
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Public Safety Board means the Public Safety Board of Trustees provided
hereunder to administer and manage Funds for the benefit of Public Safety Officers.
Public Safety Officers means Firefighters and/or Police Officers as defined in this
document.
Salary or Compensation means for Firefighters and Police Officers hired before
October 1, 2010, the total cash remuneration paid to a police officer or firefighter for
services rendered including Base Pay, Bonuses, Career Service Annual Award, Holiday
Pay, Incentives, Overtime (subject to the limitations in subsections 2 (a) and (b) below),
Sick Leave and Vacation Leave Payout on Termination (subject to the limitations in
subsections 2(a) and (b) below), Sick-Leave and Vacation Leave Buy Back (subject to
the limitations in subsections 2(a) and (b) below�, and Straight Time, and effective for
payments made after 12/31/08, as provided for by Internal Revenue Code §414(u)(7),
this definition of salary shall include any differential wage payment from the employer to
a member as a result of the member's absence from employment while serving in
qualified military service. This definition excludes pay received as a Car Allowance,
Clothing Allowance and Shoe/Boot Allowance. The amount of compensation taken
into account under the System may not exceed $200,000. This amount is subject to
adjustment as provided for in Code Section 401(a)(17), Code Section 415(d) and
Section 19 of this Plan.
For firefighters hired on or after October 1, 2010, the definition of salary shall mean the
fixed monthly remuneration paid to a firefighter for services rendered (including regular
earnings, vacation pay, and sick pay) but shall exclude lump sum payments, overtime,
bonuses, incentives, and longevity.
(a) For firefighters, effective October 1, 2013� overtime included in Salary is
limited to 300 hours per firefighter per year. Prior to October 1, 2013, all
overtime for firefighters hired before October 1, 2010 is included in the
definition of Salary. No hours of both unused accumulated sick leave
and unused accumulated vacation leave earned after June 29, 2015 will
be considered Salary, however, firefighters hired before October 1, 2010
may include all hours of unused sick leave and unused vacation leave
earned as of June 29, 2015 provided that amount of hours is cashed in at
retirement.
(b) For police officers, effective October 1, 2014� overtime included in Salary
is limited to 300 hours per police officer per year. Prior to October 1,
00121944.RTF;1
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2014, for police officers hired before October 1, 2010, all overtime is
included in the definition of Salary. No hours of both unused
accumulated sick leave and unused accumulated vacation leave earned
after October 1, 2014, will be considered Salary, however, Police Officer
Members hired before October 1, 2010, may include all hours of unused
sick leave and unused vacation leave earned as of September 30, 2014
provided that amount of hours is cashed in at retirement.
S�ouse means the lawful wife or husband of a plan member at the time of
pre-retirement, death or retirement.
Statement of Investment Policv means the written investment policy adopted by
the Board pursuant to this Ordinance and F.S. 112.661, et seq., which shall apply to
funds under the control of each board.
System means the Village of Tequesta Public Safety Officers' Pension Trust
Fund as contained herein and all amendments thereto.
Vested deferred retirement means a Member hired before August 13, 2015 who
leaves the employ of the Village with 6 or more years of credited service and who is not
eligible for any other retirement benefit. Effective on and after August 13, 2015, the
term means a Firefighter Member hired on or after August 13, 2015 who leaves the
employ of the Village with 10 or more years of credited service and who is not eligible
for any other retirement benefit. This benefit is payable at early or normal retirement.
Villaqe means the Village of Tequesta, Florida.
2. Masculine Gender. The masculine gender, where used herein, unless the
context specifically requires otherwise, shall include both the feminine and masculine
genders.
Section 3. Membership.
1. Condition of EliQibilitv
All full time Police Officers �;Te�-�e#o���'� ��` and Firefighters as of
the effective date of this Plan, and all future new full time Police Officers and
Firefighters shall become Members of this System as a condition of employment,
except that participation in this system is optional for the Police Chief and the
Fire Chief.
2. Membership
Each full time Police Officer �",;Ted--�e#c���c� • ', �^� or Firefighter shall
00121944.RTF;1
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complete a form prescribed by the Board which may include the following
information:
A. Acceptance of the terms and conditions of the Retirement System, and,
B. Designation of a beneficiary or beneficiaries, and,
C. A certified statement as to prior medical and/or psychological history.
3. Change in Desiqnation of Beneficiary
A. A member may f�om time to time change his/her designated beneficiary by
written notice to the Board upon forms provided by the Board. Upon
such change, the rights of all previously designated beneficiaries to
receive any benefits under the System shall cease.
B. Any retired member may change the designated joint pensioner or
beneficiary up to twice in accordance with Florida Statutes §175.333 and
§185.341 without the approval of the board of trustees or the current joint
pensioner or beneficiary. The retired member is not required to provide
proof of the good health of the joint pensioner or beneficiary being
removed, and the joint annuitant or beneficiary being removed need not
be living. Any retired member who desires to change his or her joint
pensioner or beneficiary shall file with the board of trustees a notarized
notice of such change. Upon receipt of a completed change of joint
pensioner form or such other notice, the board of trustees shall adjust the
retired member's monthly benefit as provided for in Section 12 by the
application of actuarial tables and calculations developed to ensure that
the benefit paid is the actuarial equivalent of the present value of the
member's current benefit and there is no impact to the Plan. The joint
pensioner or beneficiary being removed will be assumed deceased by the
actuary in determining the actuarially equivalent amount of the revised
monthly payment. No retired member's current benefit shall be increased
as a result of the change of joint pensioner or beneficiary. Any costs
associated with these benefit calculations shall be borne by the retired
member.
Section 4. Board of Trustees.
1. The sole and exclusive administration of and responsibility for the proper
operation of the retirement system and for making effective the provisions of this
ordinance is hereby vested in a Board of Trustees.
A. The Public Safety Board shall consist of five (5) Trustees, two (2) of
whom, unless otherwise prohibited by law, shall be legal residents of the
00121944.RTF;1
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Village, who shall be appointed by the Tequesta Village Council, and one
(1) of whom shall be a full-time Police Officer member of the System and
one (1) of whom shall be a full-time Firefighter member of the System.
The fifth (5th) Trustee shall be selected by a majority vote of the other four
(4) Trustees. Each person seeking to fill a designated employee
representative Board member seat shall be separately elected by their
full-time co-workers who are members of the System in the applicable
employee representative group, e.g. Police Officer or Firefighter in which
they are employed and shall be elected by a majority of the full-time
employees who are Members of the System within the applicable
employee representative group. Upon receipt of the fifth (5th) person's
name the Tequesta Village Council shall, as a ministerial duty, appoint
such person to the Public Safety Board as its fifth (5th) Trustee. The fifth
(5th) Trustee shall have the same rights as each of the other Trustees
appointed or elected as herein provided and shall serve a two (2) year
term unless the office is sooner vacated and may succeed himself or
herself in office. Each resident Trustee shall serve as Trustee for a
period of two (2) years unless sooner replaced by the Tequesta Village
Council at whose pleasure the Trustee shall serve, and may succeed
himself or herself as a Trustee. Each Police Officer or Firefighter Trustee
shall serve as Trustee for a period of finro (2) years, unless he/she sooner
leaves the employment of the employee representative group he/she was
elected to represent or otherwise vacates his/her office as Trustee,
whereupon a successor shall be chosen in the manner as the departing
Trustee. Each employee representative Trustee may succeed himself or
herself in office.
B. Wheneve� the active police officer or firefighter membership falls below
10, an active police officer or firefighter trustee member seat may be held
by either a retired police officer or retired firefighter. as ap�licable or an
active police officer member of the plan who is elected by the active and
retired members of the plan. If there are no active or retired police officers
remaining in the plan or capable of serving, the remaining board members
may elect an individual to serve in the active police officer member seat.
Upon receipt of such person's name, the legislative body of the
municipality shall, as a ministerial duty, appoint such person to the board
of trustees.
C. The Public Safety Board shall meet at least quarterly each year. Such
Boards shall be a legal entity with, in addition to other powers and
responsibilities contained herein, the power to bring and defend lawsuits
of every kind, nature, and description.
2. The Board shall, by majority vote, elect a chairman and secretary. The
secretary of the Board shall keep, or cause to be kept, a complete minute book of the
00121944.RTF;1
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actions, proceedings, or hearings of the Board and shall preside over Board meetings in
the absence of the Chairman. The Trustees shall not receive any compensation as
such, but may receive expenses and per diem as provided by law.
3. Each Trustee shall be entitled to one vote. Three (3) affirmative votes shall
be necessary for any decision by the Trustees at any meeting of the Board. A Trustee
shall have the right to abstain from voting as the result of a conflict of interest provided
that Trustee states in writing the nature of the conflict complies with the provisions of
Section 112.3143, Florida Statutes.
4. The Board of Trustees shall engage such actuarial, accounting, legal, and
other services as shall be required to transact the business of the Retirement System to
administer and manage their funds and to meet the requirements of applicable law.
The compensation of all persons engaged by the Board of Trustees and all other
expenses of the Board necessary for the operation of the Retirement System shall be
paid from the Fund they administer and manage at such rates and in such amounts as
the Board of Trustees shall approve.
5. The duties and responsibilities of the Board of Trustees shall include, but
not necessarily be limited to, the following:
A. To construe the provisions of the System and determine all questions
arising thereunder.
B. To determine all questions relating to eligibility and participation.
C. To determine and certify the amount of all retirement allowances or other
benefits hereunder.
D. To establish uniform rules and procedures to be followed for
administrative purposes, benefit applications and all matters required to
administer the System.
E. To distribute to Members, at regular intervals, information concerning the
System.
F. To receive and process all applications for participation and benefits.
G. To authorize all payments whatsoever from the Fund and to notify the
disbursing agent, in writing, of approved pension payments and other
expenditures arising through operation of the System and the Fund.
H. To have performed actuarial studies in accordance with Florida Statute
112.63 providing a copy of the same to the Division of Retirement, and
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with at least biennial valuations, and make recommendations regarding
and all changes in the provisions of the System.
I. Ensure compliance with Article X, Section 14, of the Florida Constitution,
requiring that any increase in benefits be funded on an actuarially sound
basis.
J. Ensure the completion of an actuarial impact statement prior to the
adoption of a change in the plan's retirement benefits, a copy of which
must be provided to the Division of Retirement.
K. To comply with the Chapters.
L. To ensure the funds and assets for the benefit of the employee groups
they serve are segregated and separated from the funds and assets under
the control of the Board.
M. To perform such other duties as are specified in this Ordinance and
generally do all acts which the Trustees may deem necessary or desirable
for the protection of the Trust Fund.
N. To adopt and be guided by Statements of Investment Policy applicable to
all funds unde�the control the Public Safety Board of Trustees as required
from time to time by F.S. 112.661, et seq., and/or its successor statutes.
O. To sue or be sued.
P. To settle, compromise or submit to arbitration (at the sole discretion of the
Trustees) any claims, debts or damages due or owing to or from the Fund.
Section 5. Finance and Fund Management.
Establishment and Operation of Fund
1. As part of the System, there is hereby established a Fund, into which shall
be deposited all of the contributions and assets whatsoever attributable to the System,
for the benefit of Public Safety Officers to be administered and managed by the Public
Safety Board.
2. The actual custody and supervision of the Fund (and assets thereofl shall
be vested in the Board of Trustees. Payment of benefits and disbursements from the
Fund shall be made by the Village as the Board's agent, but only upon written
authorization from the Board. Such written authorization shall require the signature of
two of the Trustees or other Board authorized fiduciary.
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3. All funds and securities of the Fund may be deposited by the Board of
Trustees with the Treasurer of the Village, acting in a ministerial capacity only, who shall
be liable in the same manner and to the same extent that as he is liable for the
safekeeping of funds for the Village. Howeve�, any funds and securities so deposited
with the Treasurer of the Village shall be kept in separate funds by the Treasurer or
clearly identified as such funds and securities of the Public Safety Officer Trust Fund.
In lieu thereof, the Board of Trustees shall deposit the funds and securities of the Fund .
in a qualified public depository or depositories as defined in Section 280.02, Florida
Statutes, which depository or depositories with regard to such funds and securities shall
conform to and be bound by all of the provisions of Chapter 280, Florida Statutes.
4. In order to fulfill its investment responsibilities as set forth herein, the
Boards may retain the services of a custodian bank or banks, an investment advisor or
advisors registered under Investment Advisors Act of 1940 or otherwise exempt from
such required registration, an insurance company, or a combination of these, for the
purposes of investment decisions and management. Such investment manager or
managers shall have discretion, subject to any guidelines as prescribed by the Board, in
the investment of all fund assets.
5. All funds and securities of the System shall be accounted for separately
based upon the two (2) applicable employee classes within the Fund namely, the Police
Officers and Firefighters in the Public Safety Officers Trust Fund. Accurate records
shall be maintained at all times reflecting the financial composition of the Fund and of
the accounts in place to segregate the assets of the employee classes covered by the
System, including accurate current accounts and entries as regards the following:
A. Current amounts of Accumulated Contributions of Members on both an
individual and aggregate account basis, and
B. Receipts and disbursements, and
C. Benefit payments, and
D. Current amounts clearly reflecting all moneys, funds and assets
whatsoever attributable to contributions and deposits from the Village,
County or State, and
E. All interest, dividends and gains (or losses) whatsoever, and
F. Such other entries as may be properly required so as to reflect a clear and
complete financial report of the Fund.
G. Such other entries as required by the Chapters.
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6. An independent audit shall be performed annually by a certified public
accountant for the most recent fiscal year of the Village showing a detailed listing of
assets and a statement of all income and disbursements during the year for each Fund.
Such income and disbursements must be reconciled with the assets at the beginning
and end of the year. Such report shall reflect complete evaluations of assets on both a
cost and market basis, as well as other items normally included in a certified audit.
7. The Board of Trustees shall have the following investment powers and
authority:
A. The Board of Trustees shall be vested with full legal title to the Fund,
subject, however, and in any event to the authority and power of the
Tequesta Village Council to amend or terminate this Trust, provided that
no amendment or Fund termination shall ever result in the use of any
assets of the Fund except for the payment of regular expenses and
benefits under this System. All contributions from time to time paid into
the Fund, and the income thereof, without distinction befinreen principal
and income, shall be held in the Fund and administered by the Board or its
Agents.
B. All moneys paid into or to be held shall be invested and reinvested by the
Board and the investment of all or any part of such funds shall be limited
to:
(1) Annuity and life insurance contracts of life insurance companies in
amounts sufficient to provide, in whole or in part, the benefits to which all
of the participants in the Fund shall be entitled under the provisions of the
Plan and pay the initial and subsequent premium thereon.
(2) Time or savings accounts of a national bank, a state bank insured
by the Bank Insurance Fund, or a savings and loan association insured by
the Savings Association Insurance Fund which is administered by the
Federal Deposit Insurance Corporation or a state or federal chartered
credit union whose share accounts are insured by the National Credit
Union Share Insurance Fund.
(3) Obligations of the United States or obligations guaranteed as to
principal and interest by the government of the United States.
(4) Bonds, stocks, commingled or other pooled funds, which may
include mutual funds or exchange-traded funds or trusts, except as
provided in paragraph M below, or evidences of indebtedness issued or
guaranteed by a corporation organized under the laws of the United
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States, any state or organized territory of the United States, or the District
of Columbia, provided that the corporation is traded on a nationally
recognized Exchange and in the case of bonds only holds a rating in one
of the four highest classifications by a major rating service, and if such
investments are held in a pooled fund then the rating of each issue in the
pooled fund shall hold a rating within the top four (4) rating classifications
of a major rating service, except that 5% of the total market value of the
portfolio may be invested in securities that are below these rating
guidelines and all securities must maintain at least a "B" rating at the time
of purchase by a nationally recognized rating organization.
(5) Real estate.
(6) Up to 25% of Plan assets may be invested in foreign securities.
Additionally, the value of bonds denominated in US dollars that are issued
by a foreign bank or corporation (Yankee Bonds) shall not exceed 5% of
the total fund.
(7) All monies paid into or held in the Pension Fund shall be invested
and reinvested by the Board of Trustees and the investment of all or any
part of such funds shall be invested in accordance with an established
investment policy adopted by the Board of Trustees.
C. The Board of Trustees shall not invest more than five percent (5%) of its
assets in the common stock or capital stock of any one issuing company,
nor shall the aggregate investment in any one issuing company exceed
five percent (5%) of the outstanding capital stock of that company; nor
shall the aggregate of its investments in common stock, capital stock and
convertible bonds at market exceed seventy percent (70%) of the assets
of the Fund. Additionally, the value of bonds issued by any single
corporation shall not exceed 5% of the total fund.
D. The Board of Trustees may retain in cash and keep unproductive of
income such amount of the Fund as it may deem advisable, having regard
for the cash requirements of the System.
E. No person or entity shall be liable for the making, retention or sale of any
investment or reinvestment made as herein provided, nor for any loss or
diminishment of the Fund, except that due to his/her or its own negligence,
willful misconduct or lack of good faith.
F. The Board may cause any investment in securities held to be registered in
or transferred into their name as Trustee or into the name of such
nominee as they may direct, or they may retain them unregistered and in
form permitting transferability, but the books and records shall at all times
00121944.RTF;1
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show that all investments are part of the Trust Fund.
G. The Board is empowered, to vote upon any stocks, bonds or securities of
any corporation, association, or trust and to give general or specific
proxies or powers of attorney with or without power of substitution; to
participate in mergers, reorganizations, recapitalization, consolidations
and similar transactions with respect to such securities; to deposit such
stock or other securities in any voting trust or any protective or like
committee with the Trustees or with depositories designated thereby; to
amortize or fail to amortize any part of all of the premium or discount
resulting from the acquisition or disposition of assets; and generally to
exercise any of the powers of an owner with respect to stocks, bonds, or
other investments comprising the Fund which it may deem to be the best
interest of the Fund to exercise. This responsibility may be delegated to
an Agent for the Board.
H. The Board shall not be required to make any inventory or appraisal or
report to any court, nor secure any order of court for the exercise of any
power contained herein.
I. Where any action which the Board is required to take on any duty or
function which it is required to perform either under the terms herein or
under the general law applicable to it as Trustee under this Ordinance,
can reasonably be taken or performed only after receipt by it from a
Member, the Village, the Department or any other entity, of specific
information, certification, direction or instructions, the Board shall be free
of liability in failing to take such action or perform such duty or function
until such information, certification, direction or instruction has been
received by it.
J. Any overpayments or underpayments from a Fund to a Member or
beneficiary caused by errors of computation shall be adjusted with interest
at a rate per annum approved by the Board. Overpayment shall be
charged against member's payments next succeeding the correction.
Underpayments shall be made up from the Trust Fund.
K. The Board shall sustain no liability whatsoever for the sufficiency of a
Fund to meet the payments and benefits herein provided.
L. Any of the foregoing powers and functions reposed in the Board may be
performed or carried out by the Board through duly authorized Agents,
provided that the Board at all times maintains continuous supervision over
the acts of any such Agent; provided further, that legal title to the Fund
shall always remain in the Board of Trustees.
00121944.RTF;1
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M. A Board shall not invest more than ten percent (10%) at cost of its assets
in real property or real estate and there shall be no real estate investment
in a closed-ended limited partnership or a closed-ended trust. In
addition, any investments in real estate in open ended limited partnerships
or open ended trusts a�e limited to those open ended core real estate
products which meet the criteria for the NCREIF ODCE.
N. The Village shall maintain Fiduciary Liability insurance to cover the
members of the Board of Trustees.
O. With respect to any investment, the Trustees may consent or object to any
action or non-action of any corporation or of the directors, officers or
stockholders of any corporation.
P. Nofinrithstanding anything else in this subsection and as provided in
Florida Statutes §215.473, the board of trustees must identify and publicly
report any direct or indirect holdings it may have in any scrutinized
company, as defined in that section. Beginning January 1, 2010, the
Board must proceed to sell, redeem, divest, or withdraw all publicly traded
securities it may have directly in that company. The divesture of any
such security must be completed by September 10, 2010. The board
and its named officers or investment advisors may not be deemed to have
breached their fiduciary duty in any action taken to dispose of any such
security, and the board shall have satisfactorily discharged the fiduciary
duties of loyalty, prudence, and sole and exclusive benefit to the
participants of the pension fund and their beneficiaries if the actions it
takes are consistent with the duties imposed by Florida Statutes §215.473,
as provided for in Florida Statutes 185.06(7) / 175.071(8) and the manner
of the disposition, if any, is reasonable as to the means chosen. For
purposes of determining which companies are scrutinized companies, the
Board may utilize the list of scrutinized companies as developed by the
Florida State Board of Administration. No person may bring any civil,
criminal, or administrative action against the board of trustees or any
employee, officer, director, or advisor of such pension fund based upon
the divesture of any security pursuant to this subsection.
Section 6. Contributions.
1. Member Contributions
A. Amount.
Firefighters Members:
00121944.RTF;1
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Effective with the payroll period that includes October 1, 2016, the
Firefighter Members shall be required to make regular contributions to the
Fund in the amount of five and one-half(5.5) percent.
Effective with the payroll period including October 1, 2017, the Firefighter
Members shall be required to make regular contributions to the Fund in
the amount of six (6) percent.
For the period befinreen October 9, 2008 and the payroll period that
includes October 1, 2016, the Firefighter Member contributions were five
(5) percent. During the period between June 8, 2005 and October 9,
2008, the Firefighter Member contribution was six and one tenth (6.1)
percent and the funding for the difference between the previously required
contribution of 6.1% and the now required 5% shall be made up from the
monies received from the State pursuant to Chapter 175, F.S. Should
the Chapter 175 money ever become insufficient to make up the
difference, the contribution rate for Firefighter Members shall automatically
revert to 6.1%.
If, after October 1, 2016, the Village determines to opt out of participation
in the distribution of the Chapter 175 money or acts to cause the State of
Florida to stop issuing the Chapter 175 money to the Fund, then the
employee contribution rate will immediately decrease to five (5) percent.
Police Officer Members:
Police OfFcer Members of the Retirement System hired before Februar�
2013 shall be required to make regular contributions to the Fund in the
amount of five percent (5%) of his/her salary.
Effective with the qayroll qeriod that includes February 1. 2013. the Police
Officer Members hired on or after February 1. 2013 shall be required to
make reqular contributions to the Fund in the amount of six percent (6%)
of his/her salarv.
Member contributions withheld by the Village on behalf of the Member
shall be deposited with the Board of Trustees immediately after the
withholding of such contributions. The contributions made by each
Member to the Fund shall be designed as employer contributions pursuant
to Section 414(h) of the Code. Such designation is contingent upon the
contributions being excluded from the Members' gross income for Federal
Income Tax purposes. For all other purposes of the Plan, such
contributions shall be considered to be Member contributions.
B. Method. Such contributions shall be made by payroll deduction.
00121944.RTF;1
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C. Any excess annual additions shall be placed in an unallocated suspense
account.
2. State Contributions
Any monies received or receivable by reason of laws of the State of Florida,
for the express purpose of funding and paying for retirement benefits for Police Officers
or Firefighters shall be deposited with the applicable segregated account in the Trust
Fund comprising part of this System immediately and under no circumstances more
than five (5) days after receipt by the Village.
3. Village Contributions
So long as this System is in effect, the Village shall make contributions at least
quarterly to the Trust Fund in an amount equal to the normal cost and the amount
required to fund any actuarial deficiency shown by an actuarial valuation as provided in
Part VII of Chapter 112, Florida Statutes.
Effective for the Chapter 175 Funds received beginning in calendar year 2015, by
mutual consent, all of the Chapter 175 money will be used to reduce the Village's
required contributions to the Fund. Additionally, all of the accumulated reserved
Chapter 175 money as of August 13, 2015 shall be used to offset the Village's
contribution. The Village may determine to use this offset in either the 2014-2015 or
2015-2016 fiscal years.
Effective for the Chapter 185 Funds received be innina in calendar�ear 2013. bv
mutual consent, all of the Chapter 185 mone�will be used to reduce the Village's
re4uired contributions to the Fund. One-half of the accumulated unused 185 monev as
of September 30. 2014 shall be allocated to the Police Officer Members who are in the
Plan on January 1. 2019.
4. Other
Private donations, gifts and contributions may be deposited to the Fund, but such
deposits must be kept separately and kept on a segregated bookkeeping basis. Funds
arising from these sources shall be reserved exclusively for additional benefits for
Members, and shall be reserved to be spent for the additional benefits as determined by
the Board of Trustees when specifically provided for by this plan document, and may
not be used to reduce what would have otherwise been required by Village
contributions.
00121944.RTF;1
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Section 7. Benefit Amounts and Eligibility.
1. Normal Retirement Date
A. Firefiqhter Members hired before August 13, 2015 and Police Officer
Members reQardless of date of hire:
A Member's normal retirement date shall be the first day of the month
coincident with, or the next following the earlier of:
(1) attainment of age fifty-five (55) and the completion of six (6) years
of credited service, or
(2) attainment of age fifty-finro (52) and the completion of finrenty-five
(25) years of credited service.
A Member may retire on his/her normal retirement date or on the first day
of any month thereafter, and each Member shall become 100% vested in
his/her accrued benefit on the Member's normal retirement date. Normal
retirement under the Plan is retirement from employment with the Village
of Tequesta as a Police Officer or Firefighter on or after the normal
retirement date.
B. Firefiahter Members hired on and after August 13, 2015:
A Member's normal retirement date shall be the first day of the month
coincident with, or the next following the earlier of:
(1) attainment of age fifty-five (55) and the completion of ten (10) years
of credited service, or
(2) attainment of age fifty-finro (52) and the completion of twenty-five
(25) years of credited service.
A Member may retire on his/her normal retirement date or on the first day
of any month thereafter, and each Member shall become 100% vested in
his/her accrued benefit on the Member's normal retirement date. Normal
retirement under the Plan is retirement from employment with the Village
of Tequesta as a Firefighter on or after the normal retirement date.
2. Normal Retirement Benefit
Firefi4hter Members hired before October 1, 2010 and Police Officer
Members hired before February 1. 2013:
00121944.RTF;1
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A Firefighter Member who was hired before October 1, 2010 and Police Officer
Members hired before February 1. 2013, and who are +s retiring hereunder on or after
his/her normal retirement date shall receive a monthly benefit which shall commence on
his/her Retirement Date and be continued thereafter during the Member's lifetime,
ceasing upon death, but with one hundred twenty (120) monthly payments guaranteed
in any event. The retirement benefit multiplier for credited service up to August 13,
2015 shall equal:
3.0% for the first 6 years of service
3.5% for the next 4 years of service
4.0% for the next 5 years of service
3.0% for the ne�6 years of service
2.0% for the next 4 years of service
3.0% for all years after 25 years
Notwithstanding the above schedule, Firefighters hired before October 1, 2010
with credited service after August 13, 2015, shall have a 3% retirement benefit multiplier
for all future years of service beginning the first day of the first month beginning on or
after August 13, 2015.
Firefighter Members hired on and after October 1. 2010 but before Au usg t 13.
2015:
A Firefighter who was hired on and after October 1, 2010 but before August 13,
2015 and who is retiring hereunder on or after his/her normal retirement date shall
receive a monthly benefit which shall commence on his/her Retirement Date and be
continued thereafter during the Member's lifetime, ceasing upon death, but with one
hundred twenty (120) monthly payments guaranteed in any event. The retirement
benefit multiplier for service rendered up to August 13, 2015 shall equal:2.75%.
7 !10% f�r�F�c fr��G: ve�r� �f�eniinc
0
, Firefighters hired on and after October 1,
2010 but before August 13, 2015 with credited service after August 13, 2015, shall have
a 3% retirement benefit multiplier for all future years of service beginning the first day of
the first month on or after August 13, 2015.
Firefighter Member hired on and after August 13, 2015:
A Firefighter who was hired on and after August 13, 2015 and who is retiring
hereunder on or after his/her normal retirement date shall receive a monthly benefit
which shall commence on his/her Retirement Date and be continued thereafter during
the Member's lifetime, ceasing upon death, but with one hundred twenty (120) monthly
payments guaranteed in any event. The �j� retirement benefit multialier shall
00121944.RTF;1
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equa4:
2.75% for all years of service.
0
'� f�0% fn� �II vc.��c� �#er 1�l �m.+r�
Police Officer Member hired on and after February 1 2013:
A Police Officer who was hired on and after February 1 2013 and who is retirin4
hereunder on or after his/her normal retirement date shall receive a monthly benefit
which shall commence on his/her Retirement Date and be continued thereafter durina
the Member's lifetime ceasinc,�upon death but with one hundred finrenty (120 monthlv
pavments auaranteed in anY event. The retirement benefit multiplier shall eaual 2 75%
for all years of service
3. Early Retirement Date
A Police Officer Member regardless of date of hire and a Firefighter Member
hired before August 13, 2015 may retire on his/her early retirement date which shall be
the first day of any month coincident with or next following the later of the attainment of
age fifty (50) and the completion of six (6) years of credited service. Early retirement
under the Plan is retirement from employment with the Village of Tequesta on or after
the early retirement date and prior to the normal retirement date.
A Firefighter Member hired on or after August 13, 2015 may retire on his/her
early retirement date which shall be the first day of any month coincident with or next
following the later of the attainment of age fifty (50) and the completion of ten (10) years
of credited service. Early retirement under the Plan is retirement from employment
with the Village of Tequesta on or after the early retirement date and prior to the normal
retirement date.
4. Early Retirement Benefit
A Member retiring hereunder on his/her early retirement date may receive either
a deferred or an immediate monthly retirement benefit payable for life, but with one
hundred finrenty (120) monthly payments guaranteed in any event, as follows:
A. deferred monthly retirement benefit which shall commence on what would
have been his/her normal retirement date had he/she remained a Police
Officer or Firefighter and shall be continued on the first day of each month
thereafter. The amount of each such deferred monthly retirement benefit
shall be determined in the same manner as for retirement as his/her
normal retirement date except that credited service and average final
compensation shall be determined as of his/her early retirement date; or
B. immediate monthly retirement benefit which shall commence on his/her
00121944.RTF;1
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early retirement date and shall be continued on the first day of each month
thereafter. The benefit payable shall be as determined in paragraph A
above, which is actuarially reduced from the amount to which he/she
would have been entitled had he/she retired on his/her normal retirement
date and with the same number of years of credited service as at the time
his/her benefit commence and based on his/her average final
compensation at that date. In no event shall the early retirement
reduction exceed three percent (3%) for each year by which the
commencement of benefits precedes the Member's normal retirement
date.
Section 8. Pre-retirement Death.
If a plan member dies prior to retirement from the Village of Tequesta his/her
beneficiary shall receive a benefit as follows:
A. Line-of-Duty-Death-Benefit is a pension to the spouse (or children) for life
in the amount of 50% of Average Final Compensation.
B. Non-Line-of-Duty-Death-Benefit - the spouse of a Firefiqhter Member
hired before August 13, 2015 with 6 years of credited service or the
spouse of a Police Officer Member regardless of date of hire with 6 vears
of credited service will receive the actuarial equivalent of the accrued
normal retirement benefit. If the Firefighter Member was hired on or after
August 13, 2015, then in order for the spouse to receive the actuarial
equivalent of the accrued normal retirement benefit the Firefighter Member
will need to have ten (10) years of credited service.
C. In lieu of the benefits provided in A or B above, the beneficiary of a police
o�cer reQardless of date of hire or firefighter hired before August 13,
2015, with 6 or more years of service who dies prior to retirement, may
receive the benefits otherwise payable to the police officer/firefighter at
what would have been his/her early or normal retirement date.
D. In lieu of the benefits provided in A or B above, the beneficiary of a
firefighter hired after August 13, 2015, with 10 or more years of service
who dies prior to retirement, may receive the benefits otherwise payable to
the firefighter at what would have been his/her early or normal retirement
date.
Section 9. Disability.
1. Disability Benefits On-Duty
00121944.RTF;1
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Each full time employee who is a participant in the Pension Fund System and
who becomes totally and permanently disabled while an active employee of the Village
of Tequesta to the extent that he/she is unable, by reason of a medically determinable
physical or mental impairment, to render useful and efficient service as a Police Officer
or Firefighter, as was provided by the employee in their classification (Police Officer or
Firefighter) prior to the alleged impairment, which disability was directly caused by the
performance of his/her duty as a Police Officer or Firefighter shall upon establishing the
same to the satisfaction of the Board, be entitled to:
A. If the injury or disease is service connected, the employee shall be entitled
to the greater of(1) or (2):
(1) a monthly pension equal to 42% of his/her average monthly
compensation as of his/her disability retirement date, or
(2) the accrued Normal Retirement Benefit.
Any condition or impairment of health of Police Officer or Firefighter
caused by tuberculosis, hypertension, hepatitis, meningococcal meningitis
or heart disease shall be presumed to have been suffered in the line of
duty unless the contrary is shown by competent evidence, provided that
such Police Officer or Firefighter shall have successfully passed a physical
examination upon entering into such service, including cardiogram, which
examination failed to reveal any evidence of such condition; and provided
further, that such presumption shall not apply to benefits payable or
granted in a policy of life insurance or disability insurance. In order to be
entitled to the presumption in the case of hepatitis, meningococcal
meningitis, or tuberculosis the member must meet the requirements of
Section 112.181, Florida Statutes by verifying by written affidavit that, to
the best of his or her knowledge and belief:
(1) In the case of a medical condition caused by or derived from
hepatitis, he or she has not:
(a) Been exposed, through transfer of bodily fluids, to any
person known to have sickness or medical conditions
derived from hepatitis, outside the scope of his or her
employment;
(b) Had a transfusion of blood or blood components,
other than a transfusion arising out of an accident or
injury happening in connection with his or her present
employment, or received any blood products for the
treatment of a coagulation disorder since last
undergoing medical tests for hepatitis, which tests
failed to indicate the presence of hepatitis;
0012194d.RTF;1
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(c) Engaged in unsafe sexual practices or other high-risk behavior, as
identified by the Centers for Disease Control and
Prevention or the Surgeon General of the United
States, or had sexual relations with a person known to
him or her to have engaged in such unsafe sexual
practices or other high-risk behavior; or
(d) Used intravenous drugs not prescribed by a
physician.
(2) In the case of ineningococcal meningitis, in the 10 days
immediately preceding diagnosis he or she was not
exposed, outside the scope of his or her employment, to any
person known to have meningococcal meningitis or known to
be an asymptomatic carrier of the disease.
(3) In the case of tuberculosis, in the period of time since the
worker's last negative tuberculosis skin test, he or she has
not been exposed, outside the scope of his or her
employment, to any person known by him or her to have
tuberculosis.
(4) Whenever any standard, medically recognized vaccine or
other form of immunization or prophylaxis exists for the
prevention of a communicable disease for which a
presumption is granted under this section, if inedically
indicated in the given circumstances pursuant to
immunization policies established by the Advisory
Committee on Immunization Practices of the United States
Public Health Service, a Member may be required by his or
her employer to undergo the immunization or prophylaxis
unless the worker's physician determines in writing that the
immunization or other prophylaxis would pose a significant
risk to the worker's health. Absent such written declaration,
failure or refusal by a Member to undergo such immunization
or prophylaxis disqualifies the Member from the benefits of
the presumption.
2. Disability Benefits Off-Duty
Every Police Officer or Firefighter who is a participant in the Pension Fund
System who shall have become totally and permanently disabled to the extent that
he/she is unable, by reason of a medically determinable physical or mental impairment,
to render useful and efficient service as a Police Officer or Firefighter which disability is
not directly caused by the performance of his/her duties as a Police Officer or Firefighter
00121944.RTF;1
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shall be entitled the greater of A. or B.:
A. A monthly pension equal to 25% of his/her average monthly compensation
as of his/her disability retirement date, or
B. The accrued Normal Retirement Benefit.
3. Conditions Disqualifyinq Disability Benefits
Each Police Officer or Firefighter who is claiming disability benefits shall
establish, to the satisfaction of the Board, that such disability was not occasioned
primarily by:
A. Excessive or habitual use of any drugs, intoxicants or alcohol.
B. Injury or disease sustained while willfully and illegally participating in
fights, �iots or civil insurrections.
C. Injury or disease sustained while committing a crime.
D. Injury or disease sustained while senring in any branch of the Armed
Forces. This exclusion does not affect members who have become
disabled as a result of intervening military service under the federal
Heroes Earnings Assistance and Relief Tax Act of 2008 (H.R. 6081; P.L.
110-245).
E. Injury or disease sustained after his/her employment shall have terminated
as a Police Officer with the Tequesta Police Department or a Firefighter
with the Tequesta Fire Department.
F. Injury or disease sustained by a Police Officer, while working for anyone
other than the Tequesta Police Department and arising out of such
employment.
G. Injury or disease sustained by the member before employment with the
Village begins. This subparagraph applies only in the event of a duty
injury or disease.
4. Physical Examination Requirement
An employee shall not become eligible for disability benefits until and unless
he/she undergoes a physical examination by a qualified physician or physicians and/or
surgeons, who shall be selected by the Board for that purpose.
Any person receiving disability benefit under provisions of this Ordinance may be
00121944.RTF;1
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periodically re-examined by a qualified physician or physicians and/or surgeon or
surgeons who shall be selected by the Board, to determine if such disability has ceased
to exist. If the Board finds that the retiree is no longer permanently and totally disabled
to the extent that he/she is unable to render useful and efficient service as a Police
Officer or a Firefighter, the Board shall recommend to the Village that the retiree be
returned to their previous performance of duty as a Police Officer or Firefighter, and the
retiree so returned shall enjoy the same rights that Member had at the time he/she was
placed upon pension. In the event the retiree is so ordered to return shall refuse to
comply with the order within thirty (30) days from the issuance thereof, Member shall
forfeit the right to his/her pension.
The cost of the physical examination and/or re-examination of the employee or
retiree claiming and/or receiving disability benefits shall be borne by the Board. All
other reasonable costs as determined by the Board incident to the physical
examination, such as, but not limited to, transportation, meals and hotel
accommodations, shall be borne by the Board.
If the retiree recovers from disability and reenters his/her former service with the
Village of Tequesta held prior to disability retirement, his/her service will be deemed to
have been continuous, but the period beginning with the first month for which he/she
received a disability retirement income payment and ending with the date he/she
reentered the service of the Village will not be considered as credited service for the
purposes of the Plan.
The Board shall have the power and authority to make the final decision
regarding all disability claims.
5. Disability Payments
The monthly benefit to which a Member is entitled in the event of the
Member's disability retirement shall be payable on the first day of the first month after
the Board of Trustees determines such entitlement. However, the monthly retirement
income shall be payable as of the date the Board determined such entitlement, and any
portion due for a partial month shall be paid together with the first payment. The last
payment will be:
A. If the plan member recovers from the disability or attains his/her normal
retirement date, the payment due next preceding the date of such
recovery, or
B. If the plan member dies without recovering from the disability prior to
his/her normal retirement date while still disabled, the payment due next
preceding his/her death or the 120th monthly payment, whichever is later.
00121944.RTF;1
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Section 10. Monthly Supplemental Benefits.
1. Effective upon passage of this Ordinance, any retiree or beneficiary
receiving pension benefits is entitled to a monthly supplemental pension
benefit of$20 per year of service, up to a maximum benefit of$600.00.
2. This benefit shall be payable monthly as a part of the regular monthly
pension benefit. The benefit shall be payable to the reti�ee and any
beneficiary. The benefit shall cease upon the death of the member or
beneficiary, if applicable.
Section 11. Vesting.
If a Member terminates his/her employment with the Village of Tequesta, 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. Firefic�hter Members hired before August 13, 2015 and Police Officer
Members regardless of date of hire:
A. If the Member has less than six (6) years of credited service upon
termination, the Member shall be entitled to a refund of his/her
accumulated contribution or the Member may leave it deposited
with the Fund for u� to five �) vears.
B. If the Member has six (6) or more years of credited service upon
termination, the Member shall be entitled to a monthly retirement
benefit that is the actuarial equivalent of the amount of such
retirement income otherwise payable to him commencing at the
Member's otherwise normal or early retirement date, provided he
does not elect to withdraw his/her accumulated contributions and
provided the Member survives to his/her normal or early retirement
date.
2. Firefighter Members hired on or after August 13, 2015:
A. If the Member has less than ten (10) years of credited service upon
termination, the Member shall be entitled to a refund of his/her
accumulated contribution or the Member may leave it deposited
with the Fund for up to five (5) years.
B. If the Member has ten (10) or more years of credited service upon
termination, the Member shall be entitled to a monthly retirement
00121944.RTF;1
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benefit that is the actuarial equivalent of the amount of such
retirement income otherwise payable to him commencing at the
Member's otherwise normal or early retirement date, provided he
does not elect to withdraw his/her accumulated contributions and
provided the Member survives to his/her normal or early retirement
date.
Section 12. Optional Forms of Benefits.
1. In lieu of the amount and form of retirement income payable in the event
of normal, early, or disability retirement as specified herein, a plan member, upon
written request to the Board of Trustees, and subject to the approval of the Board of
Trustees, may elect to receive a retirement income or benefit of equivalent actuarial
valuation payable in accordance with one of the following options:
A. A retirement income of a larger monthly amount, payable to the Member
for his/her lifetime only.
B. A retirement income of a modified monthly amount, payable to the
Member during the joint lifetime of the Member and a dependent joint
pensioner designated by the Member and following the death of either of
them, 100%, 76%, 66-2/3%, or 50% of such monthly amounts payable to
the survivor for the lifetime of the survivor.
2. The Member, upon electing any option of this section, will designate the
joint pensioner or beneficiary (or beneficiaries) to receive the benefit, if any, payable
under the Plan in the event of the Member's death, and will have the power to change
such designation from time to time, subject to the provisions below.
A. Dependent Joint Pensioner Benefit - If a Member has elected an option
with a dependent joint pensioner and the Member's retirement income
benefits have commenced, the then retired member may thereafter
change his/her designated joint pensioner up to twice in accordance with
Florida Statutes §175.333 and §185.341 without the approval of the board
of trustees or the current joint pensioner. The retired member is not
requi�ed to provide proof of the good health of the joint pensioner being
removed, and the joint pensioner being removed need not be living.
Upon receipt of a completed change of dependent joint pensioner form or
such other notice, the Board of Trustees shall adjust the retired member's
monthly benefit by the application of actuarial tables and calculations
developed to ensure that the benefit paid is the actuarial equivalent of the
present value of the retired member's current benefit and there is no
impact to the Plan. The joint pensioner being removed will be assumed
deceased by the actuary in determining the actuarially equivalent amount
00121944.RTF;1
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of the revised monthly payment. No retired member's current benefit shall
be increased as a result of the change of the joint pensioner. The retired
member shall also be responsible for the cost of the recalculation of the
benefit by the actuary.
B. Beneficiary - If a Member has elected an option with a beneficiary and the
Member's retirement income benefits have commenced, the retired
member may thereafter change his/her designated beneficiary up to twice
in accordance with Florida Statutes §175.333 and §185.341 without the
approval of the board of trustees or the current beneficiary. The retired
member is not required to p�ovide proof of the good health of the
beneficiary being removed, and the beneficiary being removed need not
be living. Upon receipt of a completed change of beneficiary form or such
other notice, the Board of Trustees shall adjust the Retired Member's
monthly benefit by the application of actuarial tables and calculations
developed to ensure that the benefit paid is the actuarial equivalent of the
present value of the retired member's current benefit and there is no
impact to the Plan. The beneficiary being removed will be assumed
deceased by the actuary in determining the actuarially equivalent amount
of the revised monthly payment. No retired member's current benefit shall
be increased as a result of the change of beneficiary. The retired member
shall also be responsible for the cost of the recalculation of the benefit by
the actuary
3. Thereafter the joint pensioner or beneficiary may be changed, but only if
the Board of Trustees consents to the change and if the joint pensioner or beneficiary,
last previously designated by the retired member is alive when he/she files with the
Board of Trustees the request for such change. The consent of joint pensioner or
beneficiary to any such change shall not be required.
The Board of Trustees may request such evidence of the good health of joint
pensioner that is being removed as it may require and the amount of the retirement
income payable to the Police Officer or Firefighter upon designation of a new joint
pensioner shall be actuarially redetermined taking into account the age and sex of the
former joint pensioner, the new joint pensioner, and the Police Officer or Firefighter.
Each such designation will be made in writing on a form prepared by the Board of
Trustees and on completion will be filed with the Board of Trustees.
In the event that no designated beneficiary survives the Member, such benefits
as are payable in the event of the death of the Member subsequent to his/her retirement
shall be paid as provided in Section 12.
4. Retirement income payments shall be made under the option elected in
accordance with the provisions of this section and shall be subject to the following
00121944.RTF;1
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limitations:
A. If a Member dies prior to his/her normal retirement date or early retirement
date, whichever occurs, no retirement benefit will be payable under the
option to any person, but the benefits, if any, will be determined under
Section 8.
B. If the designated beneficiary (or beneficiaries) or joint pensioner dies
before the Member's retirement under the Plan, the option elected will be
canceled automatically and a retirement income of the normal form and
amount will be payable to the Member upon his/her retirement as if the
election had not been made, unless a new election is made in accordance
with the provisions of this section or a new beneficiary is designated by
the Member prior to his/her retirement and within ninety (90) days after the
death of the beneficiary.
C. If both the retired Member and the beneficiary (or beneficiaries)
designated by the Member die before the full payment has been
effected under any option providing for payments for a period certain and
life thereafter, made pursuant to the provisions of subsection 1, the Board
of Trustees may in its discretion, direct that the computed value of the
remaining payments be paid in a lump sum and in accordance with
Section 12.
D. If a Member continues beyond his/her normal retirement date pursuant to
the provisions of Section 7, subsection 1, and dies prior to his/her actual
retirement and while an option made pursuant to the provisions of this
section is in effect, monthly retirement income payments will be made, or
a retirement benefit will be paid, under the option to a beneficiary (or
beneficiaries) designated by the Member in the amount or amounts
computed as if the Member had retired under the option on the date on
which his/her death occurred.
5. The Member may not change his/her retirement option after the date of
cashing or depositing his/her first retirement check.
Section 13. Beneficiaries.
1. Each Member may, on a form provided for that purpose, signed and filed
with the Board of Trustees, designate a beneficiary (or beneficiaries) to receive the
benefit, if any, which may be payable in the event of his/her death; and each
designation may be revoked by such Member by signing and filing with the Board of
Trustees a new designation-of-beneficiary form.
00121944.RTF;1
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2. If a deceased Member fails to name a beneficiary in the manner
prescribed in subsection 1, or if the beneficiary (or beneficiaries) named by a deceased
Member predeceases the Member, the death benefit, if any, which may be payable
under the Plan with respect to such deceased Member may be paid, in the discretion of
the Board of Trustees, either to:
A. The wife or dependent children of the Member;
B. The dependent living parents of the Member; or
C. Estate of the Member.
Section 14. Deferred Retirement Option Plan.
1. Eligibilitv to Participate in the Drop
A. Any Member �bef who is eligible to receive a normal retirement
pension may participate in the DROP. Members shall elect to participate
by applying to the Board of Trustees on a form provided for that purpose.
B. Election to participate shall be forfeited if not exercised within the first
twenty-seven (27) years of combined credited service. However,
participation in the first years of enactment will be extended to those
Members �s with finrenty-eight (28) years of service in 2003.
C. A Police Officer Member �eF shall not participate in the DROP
beyond the time of attaining 30 years of service and the total years of
participation in the DROP shall not exceed five (5) years. For example:
(1) Police Officer Members with finrenty-five (25) years of credited
service at time of entry shall only participate for five (5) years.
(2) Police Officer Members with twenty-six (26) years of credited
service at time of entry shall only participate for four (4) years.
(3) Police Officer Members with twenty-seven (27) years of credited
service at time of entry shall only participate for three (3) years.
D. A Firefi.�hter Member's total vears of �articiaation in the DROP shall not
exceed five_15� �ears. Firefiahter Members are eli4ible to elect DROP
particiaation upon reachinc,�el�i ibilitv for normal retirement ua to finro�/ears
after normal retirement eli ibilitk DROP aarticiaation shall end at the first
to occur of:
00121944.RTF;1
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�1) Termination of em�lovment: or
2� Sixtv months of participation in the DROP.
E9. Upon a Member's member's election to participate in the DROP, he or she
shall cease to be a Membe� � and is precluded from accruing any
additional benefit under the Pension Fund. For all Fund purposes, the
Member �eF becomes a retirant. The amount of credited service
and final average salary freeze as of the date of entry into the DROP.
2. Amounts Payable upon Election to Participate in DROP
A. Monthly retirement benefits that would have been payable had the
Member��terminated employment with the department and elected
to receive monthly pension payments will be paid into the DROP and
credited to the retirant. Payments into the DROP will be made monthly
over the period the retirant participates in the DROP, up to a maximum of
sixty (60) months.
B. Payments to the DROP earn interest using the rate of investment return
earned on Pension Fund assets during the finrelve (12) month period
ending September 30th. The rate determined shall be the rate reported
to the Division of Retirement pursuant to Part VII of Chapter 112, Florida
Statutes and shall be no less than zero (0) percent and no more than
seven and one-half (7.5) percent. However, if a police officer or
firefighter does not terminate employment at the end of participation in the
DROP, interest credits shall cease on the current balance and on all future
DROP deposits.
1� Interest shall be credited or debited to the member's average dailv
DROP balance on a quarterly basis at the net rate determined bv
the investment consultant quarterly and reported annuall t�
state. The creditina rate is determined usin4 the Modified Dietz
method.
2� The rate is net of the investment manaQer fees are aaid. The
amount of the investment fees are reported monthlX bv the
custodian and are reaorted annuall�y the auditor. Investment
management fees are e4 nerall qy aid quarterly in arrears and are
accounted for on a cash. not accrual basis.
�3 Statements are effective December 31 St. March 31 St. June 30th. and
September 30tn
00121944.RTF;1
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C. No payments will be made from DROP until the Member �ea�e�
terminates employment with the department.
D. Upon termination of employment, Members �a#aci�� in the DROP will
receive the balance of the DROP account in accordance with the following
rules:
(1) Members may elect to begin to receive payment upon termination
of employment or defer payment of DROP until the latest day as
provided under sub-subparagraph c.
(2) Payments shall be made in either:
a. Lump sum - the entire account balance will be paid to the
retirant upon approval of the Board of Trustees.
b. Installments - the account balance will be paid out to the
retirant in three equal payments paid over 3 years the first
payment to be made upon approval of the Board of
Trustees.
c. Annuity - the account balance will be used to purchase an
annuity to be paid monthly, the first payment to be made
upon approval by the Board of Trustees. The annuity must
be purchased from an insurer licensed to sell such annuities
in Florida.
(3) Any form of payment selected by a police officer must comply with
the minimum distribution requirements of the IRC 401(A)(9) e.g.,
payments must commence by age 70'h.
(4) The beneficiary of the DROP Member par�isi�a�� who dies before
payments from DROP begin shall have the same right as the
participant in accordance with Ordinance. �
Section 15. Claims Procedures Before the Board Decision.
1. If any Member of the System has been:
A. Placed on pension under the terms and provisions of this ordinance for
disability, or
B. Placed on pension because the Member has served the required number
of years to entitle him to a pension, or
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C. Refused benefits under this Plan, and is dissatisfied with the amount of
pension the Member is receiving, or believes that he should be entitled to
benefits under the Plan, the Member may, in writing, request the Board to
review his/her case. The Board shall review the case and enter such
order thereon as it deems right and proper within sixty (60) days from
receipt of such written request and the receipt by the Board of a written
medical release authorization and a list of names and addresses of all
treating health care providers for such review of disability claims; provided,
that the Board may extend the time for entering such order by an
additional forty-five (45) days if it determines such time is necessary for
discovery in full and adequate review.
2. In the event that the order from the Board denies the claim for a change in
such benefits or denies the claim for benefits, the order of the Board shall
be put in writing. Such written order shall include:
A. The specific reasons for the denial, including specific references to
pertinent p�ovisions of the retirement system on which such denial is
based;
B. A desc�iption of any additional material or information that the Board feels
is necessary for the Member to perfect his/her claim, together with an
explanation of why such material or information is necessary; and
C. An explanation of the review procedure next open to the Member.
Such review procedure shall provide that:
(1) Prior to such review, the Member or his/her duly authorized
representative may review any pertinent documents including Plan
provisions, minutes of the meeting of the Board in which denial fo
the claim was originally recommended, and any other documents
material to the case;
(2) After such review, the Member and/or his/her duly authorized
representative shall submit their case in writing to the Board and
request a hearing. Such submission shall be filed with the Board
no later than ninety (90) days after the receipt of the order of the
Board. Upon receipt of the written submission by the Member, the
Board shall schedule an opportunity for a full and fair hearing of the
issue within the next ninety (90) days, and such scheduled hearing
shall be communicated in writing to the Member. The Member
and/or his/her duly authorized representative may then appear at
such scheduled hearing to present their case. The Board shall
00121944.RTF;1
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consider the facts presented at the scheduled hearing and shall,
within thirty (30) days after such hearing, make a final ruling in
writing on the request of the Member. The written decision shall
include the reasons for such decision and, such decision shall be
final.
(a) The Chairman shall preside over the hearing and shall rule
on all evidentiary and other legal questions that arise during
the hearing.
(b) Either party, the claimant or the Board, may file pleadings
within the time limits set herein. Procedural motions are to
be determined by the Chairman of the Board at any time.
All parties are to furnish copies of all pleadings to the
opposing parties and exchange lists with names and
addresses of witnesses expected to be called to testify at the
hearing, as well as the list of exhibits that are intended to be
introduced, at least forty-five (45) days prior to the hearing.
Testimony of witnesses shall be under oath or affirmation.
Depositions or affidavits shall not be admissible unless upon
stipulation by all parties. The Chairman, any Member of the
Board, the attorney for the Board, the claimant and the
claimanYs attorney, upon recognition by the Chairman, may
direct questions to any witness during the proceedings.
Each party shall have the right to present evidence relevant
to the issues, to cross-examine witnesses, to impeach
witnesses and to respond to the evidence presented against
the party. Each party shall have the right to present any
opening and closing arguments. Any party may secure the
services of a court reporter to record the proceedings with
the cost to be borne by the party requesting the court
reporter or requesting the transcription of the proceedings.
(c) In all cases, unless otherwise provided in this section, the
burden of proof shall be on the claimant who seeks to draw
his/her entitlement to a pension, disability pension, or
increased pension benefits.
3. In all proceedings under subsections 1 or 2 hereof, the Board shall have
the power to subpoena and require the attendance of witnesses and the
production of documents for discovery prior to and at the proceedings
provided for in each paragraph. A reasonable fee may be charged for
the issuance of any subpoenas not to exceed the fees set forth in Florida
Statutes.
00121944.RTF;1
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Section 16. Reports to Division of Retirement.
Each year no later than March 15th, the Chairman of the Board shall file two (2)
separate reports with the Division of Retirement containing the following relative to the
Police Officers and Firefighters of the Plan. The Police Officer report shall be separate
from the Firefighter report.
1. Whether in fact the Village is in compliance with the provisions of
Chapters 175 and 185, Florida Statutes.
2. A certified statement of accounting for the most recent fiscal year of the
Village (or an independent audit by a certified public accountant if required by the
Division of Retirement) showing a detailed listing of assets and methods used to value
them and a statement of all income and disbursements during the year by the Public
Safety Board. Such income and disbursements shall be reconciled with the assets at
the beginning and end of the year.
3. A statistical exhibit showing the number of Police Officers on the force of
the Village, the number included in the Pension Plan, the number of Police Officers
ineligible, classified according to the reasons for their being ineligible, and the number
of disabled and retired Police Officers and their beneficiaries receiving pension
payments and the amounts of annual retirement income or pension payments being
received by them.
4. A statistical exhibit showing the number of Firefighters on the force of the
Village, the number included in the Pension Plan, the number of Firefighters ineligible,
classified according to the reasons for their being ineligible, and the number of disabled
and retired Firefighters and their beneficiaries receiving pension payments and the
amounts of annual retirement income or pension payments being received by them.
5. A statement of the amount the Village has contributed to the Public Safety
Pension Fund for the preceding plan year and the amount the Village will contribute to
the Public Safety Pension Fund for the current plan year.
6. If any benefits are insured with a commercial insurance company, the
report shall include a statement of the relationship of the insured benefits to the benefits
provided by this Ordinance. This report shall also contain information about the
insurer, basis of premium rates, mortality table, interest rates and method used in
valuating retirement benefits.
7. An actuarial valuation of the retirement Plan for Public Safety Officers
must be made at least once every three (3) years commencing from the last actuarial
report of the Plan. Such valuation shall be prepared by an enrolled actuary who is
00121944.RTF;1
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enrolled under Subtitle C of the Title 3 Employee Retirement Income Security Act of
1974 and who is a Member of the Society of Actuaries or the American Academy of
Actuaries.
Section 17. Roster of Retirees.
The Secretary of the Boards shall keep a record of all persons enjoying a
pension under the provisions of this Ordinance in which it shall be noted the time when
the pension is allowed and when the same shall cease to be paid. Additionally, the
Secretary shall keep a record of all Police Officers and Firefighters employed by the
Village who are Members of the plan their board administers in such a manner as to
show the name, address, date of employment and date such employment is terminated.
Section 18. Board Attorney and Professionals.
The Board may employ independent legal counsel at the Pension Fund's
expense for the purposes contained herein, together with such other professional,
technical, or other advisors as the Board deems necessary.
Section 19. Maximum Pension.
1. 415(b) Internal Revenue Code Limits
A. Basic Limitations. Notwithstanding anything to the contrary in this Plan,
the provisions of Section 415 and its regulations are hereby
incorporated by reference into this plan. Subject to the
adjustments in Code Section 415, the maximum amount of the
actual annual retirement income paid in any year with respect to a
Participant under this Plan attributable to employer provided
benefits shall not exceed the dollar amount allowable for any
calendar year pursuant to §415(b) of the Code, as adjusted in such
calendar year for increases in the cost of living in accordance with
Regulations issued by the Secretary of the Treasury under §415(d)
of the Code. For purposes of applying the basic limitation,
benefits payable in any form other than a straight life annuity with
no ancillary benefits shall be adjusted, as provided by Treasury
Regulations, so that such benefits are the Actuarial Equivalent of a
straight life annuity. For purposes of this subsection Article, the
following benefits shall not be taken into account:
(1) Any ancillary benefit which is not directly related to retirement
income benefits;
(2) Any other benefit not required under §415(b)(2) of the Code
0012194d.RTF;1
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and Treasury Regulations thereunder to be taken into
account for purposes of the limitation of §415(b)(1) of the
Code.
B. This section shall be effective for distributions after December 31.
2001.
C�. For purposes of applying the limitations of Code Section 415(b),
compensation includes those items as set forth in Reg. 1.415-2(d).
This definition specifically includes the crediting of compensation
while absent from service for military duty; such crediting shall to
exceed the compensation that would have been credited under the
System if System services had continued.
2. Additional Limitation on Pension Benefits. Nofinrithstanding anything
herein to the contrary:
A. The normal retirement benefit or pension to a retiree who becomes a
member of the Plan and who has not previously participated in such Plan,
on or after January 1, 1980, shall not exceed 100 percent of his/her
average final compensation. However, nothing contained in this section
shall apply to supplemental retirement benefits or to pension increases
attributable to cost-of-living increases or adjustments. In all events,
distributions shall be limited by the applicable provisions of Code section
415(b) limits.
B. No member of the Plan who is not now a member of such Plan shall be
allowed to receive a retirement benefit or pension which is in part or in
whole based upon any service with respect to which the member is
already receiving, or will receive in the future, a retirement benefit or
pension from another retirement system or plan. This restriction does not
apply to social security benefits or federal benefits under Chapter 67, Title
10, U.S. Code.
3. 401(a)(17) Limitation on Compensation
For any person who first becomes a member in any plan year beginning
on or after January 1, 1996, compensation for any plan year shall not include any
amounts in excess of the Internal Revenue Code s. 401(a)(17) limitation (as amended
by the Omnibus Budget Reconciliation Act of 1993), which limitation shall be adjusted
as required by federal law for qualified government plans and shall be further adjusted
for changes in the cost of living in the manner provided by Internal Revenue Code s.
415(d). For any person who first became a member prior to the first plan year beginning
on or after January 1, 1996, the limitation on compensation shall be not less than the
00121944.RTF;1
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maximum compensation amount that was allowed to be taken into account under the
plan as in effect on July 1, 1993, which limitation shall be adjusted for changes in the
cost of living since 1989 in the manner provided by Internal Revenue Code s. 415(d).
Section 20. Commencement of Benefits.
1. Unless the Member otherwise elects, with such election being in writing
and to the Trustees and specifying the form of retirement income and date on which the
retirement income is to commence, the payment benefits under the Plan to the Member
shall commence not later than the 60th day after the close of the Plan Year in which the
latest following events occur:
A. The attainment by the Member of age 65;
B. The 10th anniversary of the date on which the Member commenced
participation in the Plan; or
C. The termination of the Member's service with the Village of Tequesta
2. If the payment of a Member's retirement income cannot begin on the
date required under subsection 1 of the Section because the Trustees either cannot
ascertain the amount of the Member's retirement income or cannot locate the Member
after making reasonable efforts to do so, the payment of the Member's benefit shall
begin not later than sixty (60) days after the date on which the amount can be
ascertained or the Member is located, whichever is applicable. Any such payment
shall be made retroactive to a date which is not earlier than the date on which the
payment of the Member's benefit was scheduled to begin but which is not later than the
date specified under subsection 1 of this Section.
Section 21. Distribution of Benefits.
1. Nofinrithstanding any other provision of this Plan to the contrary, a form of
retirement income payable from this Plan after the effective date of this o�dinance, shall
be made in accordance with the requirements of Code Section 401(a)(9), including the
minimum distribution incidental benefit requirements of section 1.401(a)(9)-2 Code
Section 401(a)(9)(G) to satisfy the following conditions:
A.� If the retirement income is payable before the Member's death, the
distribution shall commence to them not later than the calendar year
defined above; and
1�� shall be paid over the life of the Member or over the lifetimes of the
Member and spouse or dependent, or,
00121944.RTF;1
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2�� shall be paid over the period extending not beyond the life
expectancy of the Member and spouse or dependent.
Where a form of retirement income payment has commenced in
accordance with the preceding paragraphs and the Member dies before
his/her entire interest in the Plan has been distributed, the remaining
portion of such interest in the Plan shall be distributed no less rapidly than
under the form of distribution in effect at the time of the Member's death.
B� If the Member's death occurs before the distribution of his/her interest in
the Plan has commenced, the Member's entire interest in the Plan shall be
distributed within five (5) years of the Member's death, unless it is to be
distributed in accordance with the following rules:
1��4. The Member's remaining interest in the Plan is payable to
his/her spouse or dependent;
2�� The remaining interest is to be distributed over the life of the
spouse or dependent or over a period not extending beyond
the life expectancy of the spouse or dependent; and
�3 �. Such distribution begins within one year of the Member's
death unless the Member's spouse, issue or dependent shall
receive the remaining interest in which case the distribution
need not begin before the date on which the Member would
have attained age 70'h and if the spouse, issue or
dependent dies before the distribution to the spouse, issue
or dependent begins, this Section shall be applied as if the
spouse, issue or dependent were the Plan Member.
2. Should the Member be subject to an involuntarY mandatory distribution of
a nonforfeitable account balance that is under $5.001 but is more than $1.000. then the
assets shall be rolled over to an individual retirement plan of a desiqnated trustee or
issuer. If the present value of a vested benefit exceeds $5.000. then the benefit mav
onlv be paid out with the Member's consent.
Section 22. Miscellaneous Provision.
1. Interest of Members in Pension Fund. At no time prior to the
satisfaction of all liabilities under the Plan with respect to Members and their spouses or
beneficiaries, shall any part of the corpus or income of the Pension Fund be used for or
diverted to any purpose other than for their exclusive benefit.
2. No amendment or ordinance shall be adopted by the Village Council
of the Village of Tequesta which shall have the effect of reducing the then vested
00121944.RTF;1
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accrued benefits to Members or Members beneficiaries.
3. Rollover Distributions
A. This subsection applies to distributions made on or after January 1, 1993.
Nofinrithstanding any provision of the Plan to the contrary that would
otherwise limit a distributee's election under this subsection, a distributee
may elect, at the time and in the manner prescribed by the Board of
Trustees, to have any portion of an eligible rollover distribution paid
directly to an eligible retirement plan specified by the distributee in a direct
rollover.
B. Definitions.
(1) "Eligible rollover distribution� is any distribution of all or any portion
of the balance to the credit of the distributee or former s�ouse
under an income deduction order under Florida law, except that an
eligible rollover does not include any distribution that is one of a
series of substantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of the
distributee or the joint lives (or joint life exqectancies) of the
distributee and the distributee's designated beneficiary, or for a
specified period of 10 years or more; and any distribution to the
extent such distribution is required under section 401(a)(9) of the
Cod ;
�ess-+�ss�e.
(2) "Eligible retirement plan" is an individual retirement account
described in section 408(a) of the Code, an individual retirement
annuity described in section 408(b) of the Code, a pualified trust. an
annuitv plan desc�ibed in section 403(a) of the Code. effective
January 1. 2002. an eliQible deferred compensation �lan described
in §457(b) which is maintained bx an eliaible emqlo�er described in
§457(e)(1)(A) of the Code or an annuitv contract described in
4�b1 of the Code.
,
Ged�that accepts the distributee's eligible rollover distribution.
�u�� � }h���c �f �I clini{�le r�ll�ver rli�4riF���4i�n �� 4F�o
c��nii�iinn cnn��ce 7V1 �^'��Fe�IT�'� + nl�n i� �n inrlivirl���l
� Q1T
rcfirnmsnF �nnn��n� n� in�li�iirl���I refiremenF �nn��iF�i
(3) "Distributee" includes an employee or former employee. In
addition, the employee's or former employee's surviving spouse
and the employee's or former employee's spouse who is entitled to
00121944.RTF;1
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payment for alimony and child support under a domestic relations
order determined to be qualified by this Fund are distributees with
regard to the interest of the spouse or former spouse.
(4) "Direct rollover" is a payment by the Plan to the eligible retirement
plan specified by the distributee.
Section 23. Repeal or Termination of System.
1. This Ordinance establishing the System and Fund, and subsequent
Ordinances pertaining to said System and Fund, may be modified, terminated, or
amended, in whole or in part; provided that if this or any subsequent Ordinance shall be
amended or repealed in its application to any person benefitting hereunder, the amount
of benefits which are the time of any such alteration, amendment, or repeal shall have
accrued to the Member or beneficiary shall not be affected thereby.
2. If this Ordinance shall be repealed, or if contributions to the System
are discontinued, the Board shall continue to administer the System in accordance with
the provisions of this Ordinance, for the sole benefit of the then Members, any
beneficiaries then receiving retirement allowances, and any future persons entitled to
receive benefits under one of the options provided for in this Ordinance who are
designated by any of said Members. In the event of repeal, Plan termination, or if
contributions to the System are completely discontinued, there shall be full vesting
(100%) of benefits accrued to date of repeal. The actuarial single-sum value may not
be less than the employee's accumulated contributions to the plan, with interest if
provided by the plan, less the value of any plan benefits previously paid to the
employee.
3. Upon termination of the plan by the Village for any reason, or because of a
transfer, merger, or consolidation of governmental units, services, or functions as
provided in chapter 121, or upon written notice to the board of trustees by the Village
that contributions under the plan are being permanently discontinued, the rights of all
employees to benefits accrued to the date of such termination or discontinuance and
the amounts credited to the employees' accounts are nonforfeitable. The fund shall be
distributed in accordance with the following procedures:
A. The board of trustees shall determine the date of distribution and the asset
value required to fund all the nonforfeitable benefits, after taking into
account the expenses of such distribution. The board shall inform the
Village if additional assets are required, in which event the Village shall
continue to financially support the plan until all nonforfeitable benefits have
been funded.
00121944.RTF;1
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B. The board of trustees shall determine the method of distribution of the
asset value, whether distribution shall be by payment in cash, by the
maintenance of another or substituted trust fund, by the purchase of
insured annuities, or otherwise, for each police officer and firefighter
entitled to benefits under the plan, as specified in subsection C.
C. The board of trustees shall distribute the asset value as of the date of
termination in the manner set forth in this subsection, on the basis that the
amount required to provide any given retirement income is the actuarially
computed single-sum value of such retirement income, except that if the
method of distribution determined under subsection B involves the
purchase of an insured annuity, the amount required to provide the given
retirement income is the single premium payable for such annuity. The
actuarial single-sum value may not be less than the employee's
accumulated contributions to the plan, with interest if provided by the plan,
less the value of any plan benefits previously paid to the employee.
D. If there is asset value remaining after the full distribution specified in
subsection C, and after payment of any expenses incurred with such
distribution, such excess shall be returned to the Village, less return to the
state of the state's contributions, provided that, if the excess is less than
the total contributions made by the Village and the state to date of
termination of the plan, such excess shall be divided proportionately to the
total contributions made by the Village and the state.
E. The board of trustees shall distribute, in accordance with the manner of
distribution determined under subsection B, the amounts determined
under subsection C.
4. The allocation of the Fund provided for in this subsection may, as decided
by the Board be carried out through the purchase of insurance company contracts to
provide the benefits determined in accordance with this subsection. The Fund may be
distributed in one sum to the persons entitled to said benefits or the distribution may be
carried out in such other equitable manner as the Board may direct. The Trust may be
continued in existence for purposes of subsequent distributions.
5. After all the vested and accrued benefits provided hereunder have been
paid and after all other liabilities have been satisfied, then and only then shall any
remaining fund revert to the General Fund of the Village.
Section 24. Exemption from Execution, Non-assignability.
The pensions, annuities, or any other benefits accrued or accruing to any person
under the provisions of this Ordinance and the accumulated contributions and the cash
securities in the Fund created under this Ordinance are hereby exempted from any
00121944.RTF;1
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state, county or municipal tax of the state and shall not be subject to execution,
attachment, garnishment or any legal process whatsoever and shall be unassignable.
However, pursuant to an income deduction order, the trustees may direct that
retirement benefits be paid for alimony or child support in accordance with rules and
regulations adopted by the Board of Trustees.
Upon written request by the retiree, the Board of Trustees may authorize the
Plan administrator to withhold from the monthly retirement payment funds necessary to:
1. pay for benefits being received through the Village;
2. pay the certified bargaining agent; or
3. to pay for premiums for accident health and long-term care insurance for
the retiree, the retiree's spouse and dependents. A retirement plan does
not incur liability for participation in this permissive program if its actions
are taken in good faith pursuant to Florida Statutes §§175.061(7) and
185.05(6).
Section 25. Pension Validity.
The Board of Trustees shall have the power to examine into the facts upon which
any pension shall heretofore have been granted and under any prior or existing law, or
shall hereafter be granted or obtained erroneously, fraudulently or illegally for any
reasons. Said Board is empowered to purge the pension rolls of any person heretofore
granted a pension under prior or existing law or heretofore granted under this Ordinance
if the same is found to be erroneous, fraudulent or illegal for any reason, and to
reclassify any person who has heretofore under any prior or existing law been or who
shall hereafter under this Ordinance be erroneously, improperly or illegally classified.
Section 26. Forfeiture of Pension.
Any Member convicted of the following offenses committed prior to retirement, or
whose employment is terminated by reason of his/her admitted commission, aid or
abatement of the following specified offenses, shall forfeit all rights and benefits under
this Pension Fund, except for the return of this accumulated contributions as of the date
of termination.
1. Specified offenses are as follows:
A. The committing, aiding or abetting of an embezzlement of public funds;
B. The committing, aiding or abetting of any theft by a public officer or
employee from employer;
00121944.RTF;1
-43-
C. Bribery in connection with the employment of a public officer or employee;
D. Any felony specified in Chapter 838, Florida Statutes;
E. The committing of an impeachable offense.
F. The committing of any felony by a public officer or employee who willfully
and with intent to defraud the public or public agency, for which he acts or
in which he is employed, of the right to receive the faithful performance of
his/her duty as a public officer or employee, realizes or obtains or attempts
to obtain a profit, gain, or advantage for himself or for some other person
through use or attempted use of the power, rights, privileges, duties or
position of his/her public office or employment position.
G. The committing on or after October 1, 2008, of any felony defined in
§800.04, Florida Statutes, against a victim younger than 16 years of age,
or any felony defined in Chapter 794, Florida Statutes against a victim
younger than 18 years of age, by a public officer or employee through the
use or attempted use of power, rights, privileges, duties, or position of his
or her public office or employment position.
2. Definitions
A. Conviction shall be defined as:
An adjudication of guilt by a court of competent jurisdiction; a plea of guilty
o� nolo contendere; a jury verdict of guilty when adjudication of guilt is
withheld and the accused is placed on probation; or a conviction by the
Senate of an impeachable offense.
B. Court shall be defined as:
Any state or federal cou�t of competent jurisdiction which is exercising
jurisdiction to consider a proceeding involving the alleged commission of a
specified offense. Prior forfeiture, the Board of Trustees shall hold a
hearing on which notice shall be given to the Member whose benefits are
being considered for forfeiture. Said Member shall be afforded the right
to have an attorney present. No formal rules of evidence shall apply, but
the Member shall be afforded a full opportunity to present his/her case
against forfeiture.
Any Member who has received benefits from the System in excess of
his/her accumulated contributions after Member's rights were forfeited
shall be required to pay back to the Fund the amount of the benefits
received in excess of his/her accumulated contributions. The Board of
00121944.RTF;1
-44-
Trustees may implement all legal action necessary to recover such funds.
3. False, misleading, or fraudulent statements made to obtain public
retirement benefits is prohibited; penalty
A. It is unlawful for a person to willfully and knowingly make, or cause to be
made, or to assist, conspire with, or urge another to make, or cause to be
made, any false, fraudulent, or misleading oral or written statement or
withhold or conceal material information to obtain any benefit available
under a retirement plan receiving funding under Florida Statutes, Chapters
175 and 185.
B. A person who violates subsection (A) commits a misdemeanor of the first
degree, punishable as provided in s. 775.082 or s. 775.083, Florida
Statutes.
In addition to any applicable criminal penalty, upon conviction for violation
described in subsection (A), a participant or beneficiary of a pension plan
receiving funding under Florida Statutes, Chapters 175 and 185 may, in
the discretion of the Board of Trustees, be required to forfeit the right to
receive any or all benefits to which the person would otherwise be entitled
under this Ordinance. For purposes of this paragraph, "conviction"
means a determination of guilt that is the result of a pleas or trial,
regardless of whether adjudication is withheld.
Section 27. Military Service Prior to Employment.
In accordance with Code Section 414(n). the �years or fractional parts of
years that a Member serves or has served in the military service of the Armed Forces of
the United States or United States Merchant Marine, voluntarily or involuntarily, prior to
first and initial employment with the Police Department or Fire Department shall be
added to his/her years of credited service provided that:
1. The Police Officer or Firefighter contributes to the Fund the sum that
he/she would have contributed had he/she been a member of the Plan for the years or
fractional parts of years for which he/she is requesting credit plus amounts actuarially
determined such that the crediting of service does not result in any cost to the Fund plus
payment of costs for all professional services rendered to the Board in connection with
the purchase years of credited service.
2. The request shall be made only once and made by the Member on or
before the later of finrelve (12) months from the effective date of this Ordinance or six (6)
months from the date of his/her employment with the Police Department or Fire
Department, whichever is later.
3. Payment by the Member of the required amount shall be made within
six (6) months of his/her request for credit and shall be made in one lump sum payment
upon receipt of which credited service shall be given. Credited service purchased
00121944.RTF;1
-45-
pursuant to this section shall be counted for all purposes except toward vesting of
benefits.
4. The maximum credit under this section shall be five (5) years.
Section 28. Defined Contribution Com�onent
Pursuant to the requirements of Florida Statutes 175.351(6) and 185.35 6(�. a
defined contribution olan component is established in addition to the defined benefit
component of this local law Plan. This defined contribution component is not currentiv
funded for the firefighters and is not funded for Police Officers after the initial distribution
provided for below. If the plan is funded. the Board of Trustees has the authorit�t to
adoat rules re ac,�rdin t� he o�eration of the defined contribution com�onent of the local
law plan.
One-half of the accumulated unused 185 monev as of Se�tember 30. 2014
($166.657.50) is divided pro rata among the aolice officer Members as of Januar�
2019 based on months of service into share accounts as set forth below from the
Memorandum of Understanding between the Villac�e of Teauesta and the Palm Beach
Coun Police Benevolent Association dated January �. 2019. These share account
balances will be credited with earnings and losses based on the earninqs of the Fund as
a whole with the first allocation of earnin4s and losses as of March 31. 2019. The
balances are �avable to the named police officer Members upon the Member's eligibilitv
for and receipt of a pension from this Plan.
Name Eligibility Date Shared Amounts
1. Smolen, Keith 2/6/01 $27,479.40
2. Fabiano, Joseph 4/4/05 $21,245.65
3. Lally, Maximilian 10/29/07 $17,301.85
4. Korkowski, Raymond 11/19/07 $17,174.63
5. Ramirez, Ariel 12/22/08 $15,520.77
6. Blanc, Kurt 5/22/11 $11,831.41
7. Johnson, Aaron 6/20/11 $11,322.53
8. Yildiz, Emir 12/31/12 $8,778.14
9. Muniz, Matthew 3/3/14 $7,633.17
10. Waychowsky, Daniel 6/4/14 $7,251.51
11. Franklin, Jonathan 7/30/14 $6,997.07
00121944.RTF;1
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12. Jarrell, Thomas 11/1/16 $3,562.15
13. Scaduto, Christopher 11/1/16 $3,562.15
14. Loney, Michael 3/20/17 $2,926.05
15. Baldwin, Timothy 9/14/17 $2,289.95
16. Donadio, Tana 3/4/18 $1,526.63
17. Robinson, Calvin 12/17/18 $254.44
Total: $166,657.50
es�
January 24,2019
W:\Wdocs\LLP\150098\G M\00121944.RTF
00121944.RTF;1
ORDINANCE NO. 2-19
AN ORDINANCE OF THE VILLAGE COUNCIL OF THE VILLAGE OF
TEQUESTA, FLORIDA, AMENDING THE VILLAGE CODE OF
ORDINANCES AT CHAPTER 2. ADMINISTRATION. BY AMENDING
SECTION 2-61. PENSION TRUST FUNDS, EXHIBIT B, THE PUBLIC
SAFETY OFFICERS'PENSION TRUST FUND,ADOPTING REVISIONS TO
INCORPORATE PROVISIONS OF THE RECENTLY NEGOTIATED AND
APPROVED POLICE OFFICERS AND FIREFIGHTERS COLLECTIVE
BARGAINING AGREEMENTS; PROVIDING THAT EACH AND EVERY
OTHER SECTION AND SUBSECTION OF CHAPTER 2. SHALL REMAIN
IN FULL FORCE AND EFFECT AS PREVIOUSLY ENACTED; PROVIDING
A CONFLICTS CLAUSE, A SEVERABILITY CLAUSE AND AUTHORITY
TO CODIFY; PROVIDING AN EFFECTIVE DATE; AND FOR OTHER
PURPOSES.
WHEREAS, the state of Florida Municipal Police O�cers and Firefighters
Retirement Trust Funds Office has approved the Public Safety Officers Pension Trust Fund
to again receive"Chapter 185" money in conjunction with participation in a defined benefits
plan with the restoration of all benefits for police officers who are in the Village's current
defined contribution plan and who were hired after February 1, 2013; and
WHEREAS, as a result of negotiations between the Village and the police union,the
Village Council of the Village of Tequesta desires to amend the Public Safety Officers'
Pension Trust Fund by incorporating provisions of the recently negotiated and approved
police officers collective bargaining agreement, including participation in the defined benefit
plan and use of"Chapter 185" money; and
WHEREAS, the Village Council has determined that adopting the revisions to the
Public Safety Officers Pension Trust Fund as set forth herein is in the best interest of the
police officer employees and the citizens of the Village.
1
NOW, THEREFORE, BE IT ORDAINED BY THE VILLAGE COUNCIL OF THE
VILLAGE OF TEQUESTA, PALM BEACH COUNTY, FLORIDA, AS FOLLOWS:
Section 1: Chapter 2 of the Code of Ordinances of the Village of Tequesta is hereby
amended as Section 2-61 Pension Trust Funds, Exhibit B the Public Safety Officers'
Pension Trust Fund, to adopt provisions of the recently negotiated and approved Police
Officers and Firefighters collective bargaining agreements; providing that Exhibit B,
attached hereto shall hereafter read as attached.
Section 2: Each and every other section and subsection of chapter 2.
Administration. of the code of ordinances of the Village of Tequesta shall remain in full
force and effect as previously enacted
Section 3: All Ordinances or parts of Ordinances in conflict herewith be and the
same are hereby repealed.
Section 4: Should any Section or provision of this Ordinance or any portion thereof,
any paragraph, sentence, or word be declared by a court of competent jurisdiction to be
invalid, such decision shall not affect the validity of the remainder of this Ordinance.
Section 5: Specific authority is hereby granted to codify this Ordinance.
Section 6: This Ordinance shall take effect retroactively to June 1, 2018.
2
G R S Retirement P 954.527.1616 F:954.525.0083 www.grsconsulting.com
Consulting
February 22, 2019
Mr. Scott Baur
The Resource Centers, LLC
4360 Northlake Blvd., Suite 206
Palm Beach Gardens, FL 33410
Re: Village of Tequesta Public Safety Officers Pension Trust Fund
Actuarial Impact Statement
Dear Scott:
As requested,we have prepared the enclosed Actuarial Impact Statement to illustrate the first year impact of
the proposed ordinances which would amend the Village of Tequesta Public Safety Officers Pension Trust
Fund as follows:
■ The Pension Plan would be re-opened for police officers. Police officers who participate in the 401(a)
Plan would enter the Pension Plan if elected and receive credit for both future service and service
earned prior to entering the Pension Plan. The benefit multiplier would be equal to 2.75%for each
year of service, and the member contribution rate for these members would be 6%of pensionable
earnings. The remaining benefits for these police officers are the same as the current Pension Plan
provisions for police officers.
■ The 401(a)Plan balances for these police officers would be transferred to the Pension Plan. This
transfer amount would be equal to the Village contributions to the 401(a) Plan for these members
plus the contributions these members would have paid to the Pension Plan, including interest. We
have estimated the transfer amount to be approximately$269,284.
■ The State Contribution Reserve for police officers of$333,315 would be divided equally to a Share
Plan for police officers and to the Village to offset future required contributions.
■ The benefit multiplier for firefighters who are hired on or after August 14, 2015 is increased to
2.75%for each year of service.
■ It is our understanding that the Ordinance language was approved by the Division of Retirement as
compliant with the provisions of Chapter 185, allowing the Village to once again participate in the
premium tax distributions going forward. The full amount of annual Chapter 185 revenue($88,336
was allocated for FYE 2018)would be used as an offset to the Village required contribution.
■ The Plan would also receive the annual Chapter 185 revenue that was allocated, but not received,for
FYE 2014—2017. The unreceived Chapter 185 revenue for these years totaled$471,094,and this
amount would be increased by the Chapter 185 revenue allocated for FYE 2018 and 2019. The full
,
� � - � � :�-
�
Mr. Scott Baur
February 22, 2019
Page 2
amount of previously unreceived Chapter 185 revenue would be used as an offset to the Village
required contributions. We have assumed that the previously unreceived Chapter 185 revenue would
be applied as an offset each year starting in FYE 2020 to reduce the required Village contribution to
$0 until the balance is fully used.
The Statement must be filed with the Division of Retirement before the final public hearing on the ordinance.
Please have a member of the Board of Trustees sign the Statement. Then send the Statement along with a
copy of the proposed ordinance to Tallahassee.
Additional Disclosures
Please refer to the last two pages of this report for a discussion of risks associated with measuring the
accrued liability and actuarially determined contribution.
This report was prepared at the request of the Board and is intended for use by the Plan and those
designated or approved by the Board. This report may be provided to parties other than the Board only in
its entirety and only with the permission of the Board. GRS is not responsible for unauthorized use of this
report.
The purpose of this report is to describe the financial effect of the proposed plan changes. No statement in
this report is intended to be interpreted as a recommendation in favor of the changes, or in opposition to
them. The potential effects on other benefit plans were not considered in this study. This report should
not be relied on for any purpose other than the purpose described above.
The calculations in this report are based upon information furnished by the Village and the Plan
Administrator for the October 1, 2018 Actuarial Valuation concerning Plan benefits,financial transactions,
plan provisions and active members,terminated members, retirees and beneficiaries. We reviewed this
information for internal and year-to-year consistency, but did not audit the data. We are not responsible
for the accuracy or completeness of the information provided by the Village and the Plan Administrator.
The calculations are based upon assumptions regarding future events,which may or may not materialize.
They are also based on the assumptions, methods, and plan provisions outlined in this report. Future
actuarial measurements may differ significantly from the current measurements presented in this report
due to such factors as the following: plan experience differing from that anticipated by the economic or
demographic assumptions; changes in economic or demographic assumptions; increases or decreases
expected as part of the natural operation of the methodology used for these measurements(such as the
end of an amortization period or additional cost or contribution requirements based on the plan's funded
status); and changes in plan provisions or applicable law. If you have reason to believe that the
assumptions that were used are unreasonable,that the plan provisions are incorrectly described,that
important plan provisions relevant to this proposal are not described,or that conditions have changed since
the calculations were made, you should contact the author of the report prior to relying on information in
the report.
G RS
Mr. Scott Baur
February 22,2019
Page 3
Jeffrey Amrose and Trisha Amrose are members of the American Academy of Actuaries and meet the
Qualification Standards of the American Academy of Actuaries to render the actuarial opinions contained
herein. The undersigned actuaries are independent of the plan sponsor.
This report has been prepared by actuaries who have substantial experience valuing public employee
retirement systems.To the best of our knowledge the information contained in this report is accurate and
fairly presents the actuarial position of the Plan as of the valuation date. All calculations have been made in
conformity with generally accepted actuarial principles and practices,and with the Actuarial Standards of
Practice issued by the Actuarial Standards Board and with applicable statutes.
We welcome your questions and comments.
Respectfully submitted,
L„6�
J ffr mrose, MAAA Trisha Amrose, MAAA
nr d Actuary No. 17-6599 Enrolled Actuary No. 17-8010
Enclosures
cc: Ms. Kerry Dutton
Ms. Bonni Jensen
GRS
VILLAGE OF TEQUESTA PUBLIC SAFETY OFFICERS PENSION TRUST FUND
Impact Statement—February 22,2019
Description of Amendments
The proposed ordinances would amend the Plan as follows:
■ The Pension Plan would be re-opened for police o�cers.Police o�cers who participate in the 401(a)
Plan would enter the Pension Plan if elected and receive credit for both future service and service
earned prior to entering the Pension Plan. The benefit muttiplier would be equal to 2.75�for each
year of service,and the member contribution rate for these members would be 6%of pensionable
earnings. The remaining benefits for these police officers are the same as the current Pension Plan
provisions for police officers.
■ The 401(a)Plan balances for these police officers would be transferred to the Pension Plan. This
transfer amount would be equal to the Village contributions to the 401(a) Plan for these members
plus the contributions these members would have paid to the Pension Plan,including interest. We
have estimated the transfer amount to be approximately$269,284.
■ The State Contribution Reserve for police officers of$333,315 would be divided equally to a Share
Plan for police officers and to the Village to offset future required contributions.
■ The benefit multiplier for firefighters who are hired on or after August 14,2015 is increased to
2.75%for each year of service.
■ It is our understanding that the Ordinance language was approved by the Division of Retirement as
compliant with the provisions of Chapter 185,allowing the Village to once again participate in the
premium tax distributions going forward. The full amount of annual Chapter 185 revenue($88,336
was allocated for FYE 2018)would be used as an offset to the Village required contribution.
■ The Plan would also receive the annual Chapter 185 revenue that was allocated,but not received,for
FYE 2014—2017. The unreceived Chapter 185 revenue for these years totaled$471,094,and this
amount would be increased by the Chapter 185 revenue allocated for FYE 2018 and 2019. The full
amount of previously unreceived Chapter 185 revenue would be used as an offset to the Village
required contributions. We have assumed that the previously unreceived Chapter 185 revenue would
be applied as an offset each year starting in FYE 2020 to reduce the required Village contribution to
$0 until the balance is fully used.
Funding Implications of Amendment
An actuarial cost estimate is attached.
Certification of Administrator
I believe the amendment to be in compliance with Part VII, Chapter 112, Florida Statutes and Section 14,
Article X of the Constitution of the State of Florida.
For the Board of Trustees
as Plan Administrator
4
SUPPLEMENTAL ACTUARIAL VALUATION REPORT
Plan
Village of Tequesta Public Safety Officers Pension Trust Fund
Valuation Date
October 1,2018
Date of Report
February 22,2019
Report Requested by
Board of Trustees
Prepared by
Jeffrey Amrose
Group Valued
All active and inactive members.
Benefits Being Considered for Change
The proposed ordinances would amend the Plan as follows:
■ The Pension Plan would be re-opened for police officers. Police ofFicers who participate in the 401(a)
Plan would enter the Pension Plan if elected and receive credit for both future service and service
earned prior to entering the Pension Plan. The benefit multiplier would be equal to 2.75%for each
year of service,and the member contribution rate for these memben would be 6%of pensionable
earnings. The remaining benefits for these police o�cers are the same as the current Pension Plan
provisions for police officers.
■ The 401(a)Plan balances for these police officers would be transferred to the Pension Plan. This
transfer amount would be equal to the Village contributions to the 401(a)Plan for these members
plus the contributions these members would have paid to the Pension Plan,including interest. We
have estimated the transfer amount to be approximately$269,284.
• The State Contribution Reserve for police o�cers of$333,315 would be divided equally to a Share
Plan for police officers and to the Village to offset future required contributions.
■ The benefit multiplier for firefighters who are hired on or after August 14,2015 is increased to
2.7596 for each year of service.
■ It is our understanding that the Ordinance language was approved by the Division of Retirement as
compliant with the provisions of Chapter 185, allowing the Village to once again participate in the
premium tax distributions going forward. The full amount of annual Chapter 185 revenue($88,336
was allocated for FYE 2018)would be used as an offset to the Village required contribution.
5
• The Plan would also receive the annual Chapter 185 revenue that was allocated,but not received,for
FYE 2014—2017. The unreceived Chapter 185 revenue for these years totaled$471,094,and this
amount would be increased by the Chapter 185 revenue allocated for FYE 2018 and 2019. The full
amount of previously unreceived Chapter 185 revenue would be used as an offset to the Village
required contributions. We have assumed that the previously unreceived Chapter 185 revenue would
be applied as an offset each year starting in FYE 2020 to reduce the required Viltage contribution to
$0 until the balance is fully used.
Particlpants Affeded
Police O�cers hired after February 1, 2013 and Firefighters hired on or after August 14,2015
would be affected. However,only participants as of October 1,2018 were considered for
this study.
Aduarial Assumptions and Methods
Same Actuarial Assumptions and Methods used in the October 1, 2018 Actuarial Valuation.
Some of the key assumptions/methods are:
Investment Return: 7.25%
Salary Increases: 6.00°�peryear
Cost Method: Entry Age Normal
Amortization Period for Any Change in Actuarial Accrued Liability
20 years
Summary of Data Used in Report
Same as the participant data used for the October 1, 2018 Actuarial Valuation, including the
11 police o�cers who would join the Plan as a result of the ordinances.
Aduarial Impact of Proposal(s)
See attached page(s)
Special Risks Involved with the Proposal That the Plan Has Not Been Exposed to Previously
Please refer to the last two pages of this report for a discussion of risks associated with measuring
the accrued liability and actuarially determined contribution.
Other Cost Considerations
This impad statement shows the first year impact of the proposed ordinances.This impact
statement does not reflect the Village's savings in the 401(a) Plan for police officers who would join
the Pension Plan. We have assumed that the Plan will receive the Chapter 185 revenue and 401(a)
Plan transfer amounts as detailed above.
6
SUMMARY OF VALUATION RESUlTS
As of October 1
2018 2018
After 8efore
COVERED GROUP
Amendment Amendment Difference
A. Number Included in the Valuation
1. Active Members 32 21 11
2. Inactive Members 11 11 0
B. Covered Annual Payroll(Reported Payroll with Salary Scale) $ 2,427,663 $ 1,763,351 $ 664,312
LON6 RANGE COST
C. Actuarial Present Value of Projected Benefits 20,489,125 17,944,686 2,544,439
D. Actuarial Present Value of Projected Normal Costs 5,570,651 3,fi54,011 1,916,640
E. Actuarial Accrued Liability(AAL): C-D 14,918,474 14,290,675 627,�99
F. Actuarial Value of l�ssets 14,650,892 14,381,608 269,284
G. Unfunded Actuarial Accrued Liability(UAAL): E-F 267,582 (90,933) 358,515
CURRENT ANNUAL COST
H. Annual Payment Needed to Amortize UAAL 143,785 142,445 1,340
As%of B 5.92 % 8.08 % (2.16) %
I. Annual Employer Normal Cost 515,402 396,043 119,359
As%of B 21.23 % 22.46 % (1.23) %
1. Adjustment for Frequency of Payment 25,056 20,467 4,589
As%of B 1.03 % 1.16 % (0.13) %
K. Required Employer Contrib: H+I+1 684,243 558,955 125,288
As%of B 28.19 % 31.70 % (3.51) %
L. Expected Covered Payroll for Contribution Year 2,524,770 1,818,656 706,114
M.Required Employer Contrib for Contribution Year 711,582 576,612 134,970
As%of L 28.18 % 31.71 % (3.52) %
N. Estimated State Premium Tax Refund 244,854 156,518 88,336
As°�of L 9.70 % 8.61 % 1.09 %
O. Use of Chapter 185 Reserve(Police Only)* 157,081 0 157,081
As%of L 6.22 % 0.00 % 6.22 %
P. Balance Required from Employer: M-N-O 309,647 420,094 (110,447)
As%of L 12.26 % 23.10 % (30.84) %
Q. Year to which Contributions Apply
1. Plan YearEnding 9/30/2020 9/30/2020
2. Employer Fiscal Year Ending 9/30/2020 9/30/2020
3. Assumed Date(s)of Employer Contribs. Monthly Monthly
'Current Village estimate of use of Chapter 185 Reserve.
7
POLICE OFFlCERS
SUMMARY OF VALUATION RESULTS
As of October 1
2o]B 2018
After Before
COVEREDGROUP Amendmeni Amendment Difference
A. Number Included in the Valuation
1. Active Members 16 5 11
2. Inactive Members 4 4 0
B. Covered Annuat Payroll(Reported Payroll with Salary Scale) $ 1,045,075 $ 380,764 $ 664,311
LONG RANGE COST
C. Actuarial Present Value of Projected Benefits 5,672,675 3,225,063 2,447,612
D. Actuarial Present Value of Projected Normal Costs 2,583,446 748,694 1,834,752
E. Actuarial Accrued Liability(AAL): C-D 3,089,229 2,476,369 612,860
F. Actuarial Value of Assets 4,073,489 3,804,205 269,284
G. Unfunded Actuarial Accrued Liability(UAAL): E-F (984,260) (1,327,836) 343,576
CURRENT ANNUAL COST
H. Annual Payment Needed to Amortize UAAL 0 0 0
As%of B 0.00 % 0.00 % 0.00 %
I. Ann�al Employer Normal Cost 227,303 113,745 113,558
fls%of B 21.75 % 29.87 % (8.12) %
J. Adjustment for Frequency of Payment 8,640 4,323 4,317
As%of B 0.83 % 1.14 % (0.31) 96
K. Required Employer Contrib: H+I+1 235,943 118,068 117,875
As%of B 22.58 % 31.01 % (8.43) %
L. Expected Covered Payroll for Contribution Year 1,086,878 380,764 706,114
M.Required Employer Contrib for Contribution
Year: %from Kx L 245,417 118,068 127,349
As%of L 22.58 % 31.01 % (8.43) %
N. Estimated State Premium Tax Refund 88,336 0 88,336
/�s%ofL 8.13 % 0.00 % 8.13 %
O. Use of Chapter 185 Reserve' 157,081 N/A N/A
As%of L 14.45 % N/A N/A
0. Balance Required from Employer: M-N 0 118,068 (118,068)
As%of L 0.00 % 31.01 % (31.01) %
P. Year to which Contributions Apply
1. Plan YearEnding 4/30/2020 9/30/2020
2. Employer Fiscal Year Ending 9/30/2020 9/30/2020
3. Assumed Date(s)of Employer Contribs. Monthly Monthly
*CuRent vllage estimate of use of Chapter 185 Reserve.
8
FIREFIGHTERS
SUMMARY OF VALUATION RESULTS
As of October 1
2018 2018
After 8efore
COVERED GROUP Amendment Amendment Difference
A. Number Included in the Valuation
1. Active Members 16 16 0
2. Inactive Members 7 7 p
B. Covered Annua)Payroll(Reported Payrol)with Salary Scale) $ 1,382,588 $ 1,382,588 $ 0
LONG RANGE COST
C. Actuarial Present Value of Projected Benefits 14,816,450 14,719,623 96,827
D. Actuarial Present Value of Projected Normal Costs 2,987,205 2,905,317 81,888
E. Actuarial Accrued Liability(AAL): C-D 11,829,245 11,814,306 14,939
F. Actuarial Value of Assets 10,577,403 10,577,403 0
G. Unfunded Actuarial Accrued Liability(UAAL): E-F 1,251,842 1,236,903 14,939
CURRENT ANNUAL COST
H. Annual Payment Needed to Amortize UAAL 143,785 142,445 1,340
AS%of B 10.40 % 10.30 % 0.10 %
I. Annual Employer Normal Cost 288,099 282,298 5,801
As%of B 20.84 % 20.42 % 0.42 %
1. Adjustment for Frequency of Payment 16,416 16,144 272
As%of B 1.19 % 1.17 % 0.02 %
K. Required Employer Contrib: H+I+J 448,300 440,887 7,413
As%of B 32.42 % 31.89 % 0.53 %
l. Expected Covered Payroll for Contribution Year 1,437,892 1,437,892 0
M. Required Employer Contrib for Contribution
Year: %from K x L 466,165 458,544 7,621
As%of L 32.42 % 31.89 % 0.53 %
N. Allowable Credit for State Revenue in Contribution Year 156,518 156,518 0
As%of L 10.89 % 10.89 % 0.00 %
0.Use of Chapter 175 Reserve 0 0 0
As%of L 0.00 % 0.00 % 0.00 %
P. Balance Required from Employer: M-N-O 309,647 302,026 7,621
As%of L 21.53 % 21.00 °.6 0.53 %
Q. Year to which Contributions Apply
1. Plan Year Ending 9/30/2020 9/30/2020
2. Employer Fiscal Year Ending 9/30/2020 9/30/2020
3. Assumed Date�s)of Employer Contribs. Monthly Monthly
9
ACTUARIAL VALUE OF BENEFITS AND ASSETS
POLICE AND FlRE COMBINED
A. Valuation Date October 1,2018 October 1,2018
Ajter Amendment Before Amendmeni Difference
B. Actuarial Present Value of All Projected
Benefits for
1. Active Members
a.Service Retirement Benefits $ 12,778,488 $ 10,687,876 $ 2,090,612
b.Vesting Benefits 798,135 600,231 197,904
c. Disability Benefits 779,466 579,602 199,864
d. Preretirement Death Benefits 185,829 133,477 52,352
e.Return of Member Contributions 12,899 9,192 3,707
f.Total 14,554,817 12,01�,378 2,544,439
2. Inactive Members
a.Service Retirees&Beneficiaries 5,209,544 5,209,544 -
b. Disability Retirees - - -
c.Terminated Vested Members 724,764 724,764 -
d.Total 5,934,308 5,934,308 -
3. Total for All Members 20,489,125 17,944,686 2,544,439
C. Actuarial Accrued(Past Service)
Liability under Entry Age Normal 14,918,474 14,290,675 627,799
D. Actuarial Value of Accumulated Plan
Benefits per FASB No.35 12,233,630 11,840,822 392,808
E. Plan Assets
1. Market Value 15,014,27Z 14,744,988 269,284
2. Actuarial Value 14,650,892 14,381,6U8 269,284
F. Unfunded Actuarial Accrued Liability:C-E2 267,582 (90,933) 358,515
G. Actuarial Present Value of Projected
Covered Payroll 23,914,798 15,696,376 8,218,422
H. Actuarial Present Value of Projected
Member Contributions 1,403,526 910,420 493,106
10
ACTUARIAL VALUE OF BENEFITS AND ASSETS
POLICE
A. Valuation Date October 1,2018 October 1,2018
After Amendment Before Amendment Difference
B. Actuarial Present Value of All Projected
Benefits for
1. Active Members
a.Service Retirement Benefits $ 4,041,926 $ 2,036,475 $ 2,005,451
b.Vesting Benefits 331,872 139,493 192,379
c.Disability Benefits 310,027 115,531 194,496
d. Preretirement Death Benefits 80,147 28,568 51,579
e. Retum of Member Contributions 3,707 - 3,707
f.Total 4,767,679 2,320,067 2,447,612
2. Inactive Members
a.Service Retirees&Beneficiaries 361,354 361,354 -
b. Disability Retirees - - -
c.Terminated Vested Members 543,642 543,642 -
d.Total 904,996 904,996 -
3. Total forAll Members 5,672,675 3,225,063 2,447,612
C. Actuarial Accrued(Past Service)
Liability under Entry Age Normal 3,089,229 2,476,369 612,860
D. Actuarial Value of Accumulated Plan
Benefits per FA56 No.35 2,443,055 2,050,259 392,796
E. Plan Assets
1. Market Value 4,182,432 3,913,148 269,284
2. Actuarial Value 4,073,489 3,804,205 269,284
F. Unfunded Actuarial Accrued Liability:C-E2 (984,260) (1,327,836) 343,576
G. Actuarial Present Value of Projected
Covered Payroll 11,354,649 3,136,227 8,218,422
H. Actuarial Present Value of Projected
Member Contributions 649,917 156,811 493,106
11
ACTUARIAL VALUE OF BENEFITS AND ASSETS
FlRE
A. Valuation Date October 1,2018 October 1,2018
AfterAmendment BeforeAmendment Difference
B. Actuarial Present Value of All Projected
Benefits for
1. Active Members
a.Service Retirement Benefits $ 8,736,562 $ 8,651,401 $ 85,161
b.Vesting Benefits 466,263 460,738 5,525
c. Disability Benefits 469,439 464,071 5,368
d.Preretirement Death Benefits 105,682 104,909 773
e.Return of Member Contributions 9,192 9,192 -
f.Total 9,787,138 9,690,311 %,827
2. Inactive Members
a.Service Retirees&Beneficiaries 4,848,190 4,848,190 -
b. Disability Retirees - - -
c.Terminated Vested Members 181,122 181,122 -
d.Total 5,029,312 5,029,312 -
3. Total for All Members 14,816,450 14,719,623 96,827
C. Actuarial Accrued(Past Service)
Liability under Entry Age Normal 11,829,245 11,814,306 14,939
D. Actuarial Value of Accumulated Plan
Benefits per FASB No.35 9,790,575 9,790,563 12
E. Plan assets
1. Market Value 10,831,840 30,831,840 -
2. Actuarial Value 10,577,403 10,577,403 -
F. Unfunded Actuarial Accrued Liability:C-E2 1,251,842 1,236,903 14,939
G. Actuarial Present Value of Projected
Covered Payroll 12,560,149 12,560,149 -
H. Actuarial Present Value of Projected
Member Contributions 753,609 753,609 -
12
ENTRY AGE CALCULATION OF EMPLOYER NORMAL COST TOTAL
A.Valuation Date October 1,2018 October 1,2018
After Amendment Before Amendment Difference
B. Normal Cost for
1. Service Retirement Benefits $ 475,841 $ 346,545 $ 129,296
2. Vesting Benefits 51,730 41,158 10,572
3. Disability Benefits 49,038 34,479 14,559
4. Preretirement Death Benefits 11,916 8,283 3,633
5. Return of Member Contributions 5,013 3,855 1,158
6. Total for Future Benefits 593,538 434,320 159,218
7. Assumed Amount for Administrative
Expenses 63,716 63,716 -
8. Total Normal Cost 657,254 498,036 159,218
C. Expected Member Contribution 141,852 101,993 39,859
D.Employer Normal Cost: B8-C 515,402 396,043 119,359
E. Employer Normal Cost as�of
Covered Payroll 21.23 % 22.46 % (1.23) %
13
ENTRY AGE CALCULATION OF EMPLOYER NORMAL COST POLICE
A.Valuation Date October 1,2018 October 1,2018
AfterAmendment BeforeAmendment Difference
B. Normal Cost for
1. Service Retirement Benefits $ 206,539 $ 82,365 $ 124,174
2. Vesting Benefits 17,614 7,363 10,251
3. Disability Benefits 22,796 8,550 14,246
4. Preretirement Death Benefits 5,659 2,071 3,588
5. Return of Member Contributions 1,734 576 1,158
6. Total for Future Benefits 254,342 100,925 153,417
7. Assumed Amount for Administrative
Expenses 31,858 31,858 -
8. Total Normal Cost 286,200 132,783 153,417
C. Expected Member Contribution 58,897 19,038 39,859
D.Employer Normal Cost: 68-C 227,303 113,745 113,558
E. Employer Normal Cost as%of
Covered Payroll 21.75 % 29.87 % (8.12) %
14
ENTRY AGE CALCULATION OF EMPLOYER NORMAL COST FIRE
A.Valuation Date October 1,2018 October 1,2015
AfterAmendment BeforeAmendment Difference
B. Normal Cost for
1. Service Retirement Benefits $ 269,302 264,180 $ 5,122
2. Vesting Benefits 34,116 33,795 321
3. Disability Benefits 26,242 25,929 313
4. Preretirement Death Benefits 6,257 6,212 45
5. Return of Member Contributions 3,279 3,279 -
6. Total for Future Benefits 339,196 333,395 5,801
7. Assumed Amount for Administrative
Expenses 31,858 31,858 -
8. Total Normal Cost 371,054 365,253 5,801
C. Expected Member Contribution 82,955 82,955 0
D.Employer Normal Cost: BS-C 288,099 282,298 5,801
E. Employer Normal Cost as%of
Covered Payroll 20.84 % 20.42 % 0.42 %
15
Risks Associated with Measuring the Accrued Liability and Actuarially Determined Contribution
The determination of the accrued liability and the actuarialty determined contribution requires the use of
assumptions regarding future economic and demographic experience. Risk measures are intended to aid in
the understanding of the effects of future experience differing from the assumptions used in the course of
the actuarial valuation. Risk measures may also help with illustrating the potential volatility in the accrued
liability and the actuarially determined contribution that result from the differences between actual
experience and the actuarial assumptions.
Future actuarial measurements may differ significantly from the current measurements presented in this
report due to such factors as the following: Plan experience differing from that anticipated by the economic
or demographic assumptions;changes in economic or demographic assumptions due to changing
conditions; increases or decreases expected as part of the natural operation of the methodology used for
these measurements(such as the end of an amortization period,or additional cost or contribution
requirements based on the Plan's funded status);and changes in Plan provisions or applicable law. The
scope of an actuarial valuation does not include an analysis of the potential range of such future
measurements.
Examples of risk that may reasonably be anticipated to significantly affect the Plan's future financial
condition include:
1. Investment risk—actual investment returns may differ from the either assumed or forecasted
returns;
2. Contribution risk—actual contributions may differ from expected future contributions. For
example,actual contributions may not be made in accordance with the Plan's funding policy or
material changes may occur in the anticipated number of covered employees,covered payroll,or
other relevant contribution base;
3. Salary and Payroll risk—actual salaries and total payroll may differ from expected, resulting in
actual future accrued liability and contributions differing from expected;
4. Longevity risk—members may live longer or shorter than expected and receive pensions for a
period of time other than assumed;
S. Other demographic risks—members may terminate,retire or become disabled at times or with
bene�ts other than assumed resulting in actual future accrued liability and contributions differing
from expected.
The effects of certain trends in experience can generally be anticipated. For example if the investment
return is less(or more)than the assumed rate,the cost of the Plan can be expected to increase(or
decrease). Likewise if longevity is improving(or worsening), increases(or decreases) in cost can be
anticipated.
The computed contribution amounts may be considered as a minimum contribution that complies with the
pension Board's funding policy and the State statutes. The timely receipt of the actuarially determined
contributions is critical to support the financial health of the Plan. Users of this report should be aware that
contributions made at the actuarially determined rate do not necessarily guarantee benefit security.
16
Risk Assessment
Risk assessment was outside the scope of this report. Risk assessment may include scenario tests,
sensitivity tests,stochastic modeling,stress tests,and a comparison of the present value of accrued
benefits at low-risk discount rates with the actuarial accrued liability.We are prepared to perform such
assessment to aid the Board in the decision making process.
17