HomeMy WebLinkAboutDocumentation_Pension General_Tab 10_05/04/2009)Village of Tequesta
General Employees Pension Fund
Summary Plan Description
May 2009
Introduction
As a Member in the Village of Tequesta General Employees Pension Fund, you are
included in a program of benefits to help you meet your financial needs in retirement, or
in the event of disability or death. The purpose of this booklet is to give you a brief
description of benefits available to you under your pension plan.
Planning for retirement begins now. This booklet can be a valuable tool in preparing
for your retirement and financial future. If you need any further information on any of the
topics presented in this booklet, please contact the Pension Coordinator or the Board of
Trustees. They will answer any questions to help you better understand your benefits.
The information presented is a summary of the pension plan as provided in the
Village of Tequesta Code of Ordinances which governs your Pension Fund. The legal
citation for your Plan is Ordinance 598, Exhibit A, et seq., Village of Tequesta Code. Any
discrepancies between information in this booklet and the Plan will be governed by the
Plan. A copy of the Plan can be obtained from the Pension Coordinator, Lori McWilliams.
Her address is:
Village of Tequesta
Post Office Box 3273
Tequesta, Florida 33469-0273
Telephone (561)575-6200
FAX Number (561)575-6203
Michael Rhodes, Chairman
Carl Hansen, Secretary
Michelle Gload
Archie Mangum
Deana Mayo
Board of Trustees
Village of Tequesta
General Employees Pension Fund
TABLE OF CONTENTS
DEFINITIONS ........................................................ 1
PARTICIPATION IN THE PENSION FUND ................................. 2
ELIGIBILITY FOR NORMAL RETIREMENT ................................ 2
AMOUNT OF A NORMAL RETIREMENT PENSION .......................... 2
Sample Pension Calculation ....................................... 3
EARLY RETIREMENT PENSION ........................................ 4
FORMS OF PAYMENT OF A PENSION ................................... 4
Normal Form ................................................... 4
Optional Forms of Payment ........................................ 5
SURVIVOR BENEFITS -DEATH BEFORE RETIREMENT ..................... 6
DISABILITY RETIREMENT ............................................. 6
Duty Disability Retirement ......................................... 7
Non-Duty Disability Retirement ..................................... 7
ENDING EMPLOYMENT BEFORE RETIREMENT ........................... 7
FILING FOR RETIREMENT ............................................. 8
TRUSTEE TO TRUSTEE TRANSFER ..................................... 8
FORFEITURE OF PENSION ............................................ 8
CLAIMS REVIEW PROCEDURE ......................................... 9
COST OF THE PENSION FUND ........................................ 10
INVESTMENTS ..................................................... 10
ACTUARIAL SOUNDNESS ............................................ 11
AGENT FOR SERVICE OF LEGAL PROCESS ............................. 11
PLAN YEAR ........................................................ 11
ACTUARIAL DATA ................................................... 12
INCOME AND DISBURSEMENTS ....................................... 13
DEFINITIONS
Accumulated contributions - a Member's own contributions.
Average Final Compensation -one-twelfth of the average salary paid during the
best five years of the last ten years of employment.
Beneficiary - an individual, such as a spouse, child or dependent parent, who is
receiving a survivor benefit from the Pension Fund following the death of a Member.
Board -the Board of Trustees which administers, manages and operates the
Pension Fund.
Credited service - A Member's years and fractional parts of years of service as a
General Employee in the Village of Tequesta, which may include military time
purchased in this plan.
Member - a Village of Tequesta General Employee participating in the Pension
Fund.
Salary -Base compensation including regular earnings, vacation pay, sick pay, and
amounts paid on a pretax basis for employee benefits, excluding lump sum
payments, overtime, bonuses and longevity bonus.
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Employees Pension Fund Page 1
PARTICIPATION IN THE PENSION FUND
Each General Employee employed in the Village of Tequesta General Employees
Department is a Pension Fund Member. A General Employee is a regular
employee who works full time for the Village and who is not a police officer or a
firefighter.
ELIGIBILITY FOR NORMAL RETIREMENT
A Member who either has 30 or more years of credited service or is age 62
regardless of years of service is eligible for normal retirement. An application for
normal retirement must be filed with the Pension Coordinator and approved by the
Board of Trustees.
AMOUNT OF A NORMAL RETIREMENT PENSION
The amount of a normal retirement pension is based on a Member's credited
service, average final compensation and pension multiplier.
Average final compensation isone-twelfth of the average salary paid during the best
five years of the last ten years of employment. Salary is base compensation
including regular earnings, vacation pay, sick pay, plus all tax deferred items of
income, excluding lump sum payments, overtime, bonuses and longevity bonus.
Credited service is generally a Member's period of employment as a General
Employee with the Village of Tequesta, measured in years and completed months
of a year.
The pension multiplier is 2%.
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Employees Pension Fund Page 2
Sample Pension Calculation
The following example illustrates how average final compensation is calculated.
This is an example for planning purposes only and does not indicate the actual
benefit for any Member.
Year Before Sample Salary
Retirement for Year
5th 2'l ,000
4th 21,000
3rd 22,000
2nd 23,000
1st 24,000
To calculate final average salary, total the last five years salary and divide by 60:
$21,000 + $21,000 + $22,000 + $23,000 + $24,000 = $1,850.00
60
The monthly normal retirement pension is calculated as follows:
2.00% (.02) of average final compensation multiplied by credited service.
The following is an illustration of a normal retirement pension calculation. This is
an example for planning purposes only and does not indicate the actual benefit for
any Member.
(1) Total credited service 30.0 yrs.
(2) Average final compensation $1,850
(3) 2.00% of line (1) .02 x 30 60%
(4) Line (3) times.li (2) 60% x 1,850. $.'1,1'10...00.,
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EARLY RETIREMENT PENSION
A General Employee who is age 50 and has 6 years of service is eligible for early
retirement. The early retirement benefits that are payable to a General Employee
are determined in the same manner as the normal retirement benefit payable at the
normal retirement date or payable immediately, but reduced by 5% for each year
that early retirement precedes normal retirement.
FORMS OF PAYMENT OF A PENSION
Normal Form
The standard form of payment for the pension described above is a benefit payable
for life with 10 years certain, in other words, you are guaranteed 120 monthly
payments.
A Member may designate a beneficiary to receive the benefit payable, if any, upon
the death of the retired Member.
When there is no beneficiary named, the benefit will be paid to the spouse,
dependent children, or dependent living parents of the General Employee, or if
there is no such survivor, then to the deceased General Employee's estate.
Pension payments will continue to the retired Member's beneficiary until a total of
120 payments have been made.
IT IS IMPORTANT TO KEEP YOUR
BENEFICIARY DESIGNATION
UP TO DATE
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Employees Pension Fund Page 4
Optional Forms of Payment
Optional forms of payment are available in lieu of the normal form described above.
The amount of pension under each optional form has the same actuarial value as
the normal form of payment (lifetime payments with 120 payments guaranteed).
• Option I -Joint and 100% Survivor -The joint and 100% survivor form of
payment pays the retired Member a reduced monthly pension for life. Upon
the retired Member's death, the beneficiary designated when the form of
payment was elected will be paid 100% of the reduced monthly pension for
life.
• Option II -Joint and 76% Survivor -The joint and 75% survivor form of
payment pays the retired Member a reduced monthly pension while the
retired Member is alive. The reduction is not as great as under Option I.
Upon the retired Member's death, the beneficiary will be paid 75% of the
reduced monthly pension for life.
• Option III -Joint and 66-2/3% Survivor -The joint and 66-2/3% survivor
form of payment pays the retired Member a reduced monthly pension while
the retired Member is alive. The reduction is not as great as under Option
II. Upon the retired Member's death the beneficiary will be paid 66-2/3% of
the reduced monthly pension for life.
• Option IV -Joint and 50% Survivor -The joint and 50% survivor form of
payment pays the retired Member a reduced monthly pension while the
retired Member is alive. The reduction is not as great as under Option III.
Upon the retired Member's death, the beneficiary will be paid 50% of the
reduced monthly pension for life.
• Option V -Life Annuity -The straight life form of payment pays the retired
Member an increased monthly pension for life. The amount of this benefit
is more than the normal form and other optional forms. No monthly pension
is ever paid a spouse, child, dependent parent or other beneficiary under this
form of payment.
• Option VI -Other - In lieu of the other optional forms, benefits may be paid
in any form approved by the Board so long as it is the actuarial equivalent of
the benefits otherwise payable.
The Pension Coordinator can give you an estimate of the amount of your pension
under any of the optional forms of payment. A request for an optional form of
Village of Tequesta General May 2009
Employees Pension Fund Page 5
payment must be submitted in writing to the Board before the effective date of
retirement. An optional form of payment cannot be changed after the first pension
check is cashed. The election of Options I, I I, III and IV shall be null and void if the
designated beneficiary dies before the member's payments commence, and the
Member will be paid in accordance with the normal form.
SURVIVOR BENEFITS -DEATH BEFORE RETIREMENT
A beneficiary of a vested Member who dies while employed with the Village of
Tequesta as a General Employee will be paid a survivor benefit of the vested
pension benefit starting when the Member would have reached normal retirement
age.
DISABILITY RETIREMENT
A pension may be payable to a Member who becomes disabled while employed frr
with the Village as a General Employee. Eligibility and the amount of the pension
are dependent on whether or not the disability occurred in the line of duty.
The disability must arise from a mental or physical illness, disease or injury which
totally and permanently prevents the Member from performing useful and efficient
service as a General Employee in the Village of Tequesta. No General Employee
shall be permitted to retire under a disability retirement until examined by a duly
qualified physician or surgeon to be selected by the Board of Trustees and the
physician orsurgeon-finds the Member to be disabled from performing the functions
of a General Employee. The final determination of disability is made by the Board.
If disability results from excessive and habitual use of drugs, intoxicants or
narcotics, willful and illegal participation in fights, riots or civil insurrection, while
committing a crime, injury or disease sustained while serving in the armed forces,
as a result of willful, wanton or gross neglect of the member, then no disability
pension can be awarded.
A Member who is retired for disability may be required to undergo periodic medical
examination under the direction of the Board of Trustees to determine if the retired
Member is capable of performing the duties of a General Employee in the Village.
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Employees Pension Fund Page 6
Duty Disability Retirement
If the Board finds the disability to have arisen out of and in the course of the
Member's performance of duty as a Village of Tequesta General Employee, the
amount of pension is equal to the greater of: 42% of the Member's average monthly
compensation or the accrued pension benefit.
Non-Duty Disability Retirement
If the disability is not the result of performing duty as a Village of Tequesta General
Employee, the amount of pension is calculated the same as a normal retirement
pension based on average final compensation and credited service at the time of
disability. The minimum pension is 25% of average final compensation.
To be eligible for anon-duty disability retirement, an Employee must have six years
of credited service as a General Employee with the Village of Tequesta,
ENDING EMPLOYMENT BEFORE RETIREMENT
Any Member who terminates employment with the Village either voluntarily or by
discharge, is entitled to a refund of contributions plus three percent (3%) interest,
regardless of the Members' credited service.
A Member may voluntarily leave their contributions in the pension fund pending re-
employment by the Village for a period up to five years.
If a Member with less than 6 years of credited service who is not age 62, quits or is
fired from employment as a Village of Tequesta General Employee, future rights to
a pension are forfeited.
If a Member has at least 6 years of credited service when employment as a general
employee terminates, the right to a deferred normal retirement is retained, so long
as accumulated contributions are left on deposit in the Pension Fund.
The amount of deferred normal retirement pension is calculated using average final
compensation and credited service at the time of termination of employment as a
general employee. The amount of pension may be subject to early retirement
reduction of 5% per year if applicable. Retirement and payment of a pension is
available upon application on or after age 50.
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Employees Pension Fund Page 7
FILING FOR RETIREMENT
In order to ensure that you receive your pension on time, you should file your
application with the Pension Coordinator at least 30 days before retirement. All
forms can be obtained from the Pension Coordinator at the address on the
Introduction page. Penalties will be imposed for making a false or misleading
statement to obtain a pension benefit. It can take up to 60 days after your date of
retirement to receive your first pension check.
TRUSTEE TO TRUSTEE TRANSFER
To minimize the tax consequences of rolling assets over to an IRA or another
qualified plan, direct trustee-to-trustee transfers are available. Please see the
Coordinator for the appropriate forms.
FORFEITURE OF PENSION
Any Member who is convicted of any of the below offenses committed prior to
retirement shall forfeit all rights and benefits under this Fund, except for a refund of
accumulated contributions. The specified offenses are:
(1) Committing, aiding or abetting of an embezzlement of public funds;
(2) Committing, aiding or abetting of any theft by a public officer or employee
from employer;
(3) Bribery in connection with the employment of a public officer or employee;
(4) Any felony specified in Chapter 838, Florida Statutes;
(5) The committing of impeachable offense
(6) The committing of any felony by a public officer or employee who, willfully
and with intent to defraud the public or the public agency for which the public
officer or employee acts or in which he or she is employed of the right to
receive the faithful performance of his or her duty as a public officer or
employee, realizes or obtains, or attempts to realize or obtain, a profit, gain,
or advantage for himself or herself or for some other person through the use
or attempted use of the power, rights, privileges, duties, or position of his or
her public office or employment position.
(7) 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
Village of Tequesta General May 2009
Employees Pension Fund Page 8
attempted use of power, rights, privileges, duties, or position of his or her
public office or employment position.
Any Memberwho has received benefits from the Plan in excess of his accumulated
contributions shall be required to repay the Fund. The Board may implement legal
action necessary to recover such funds.
Additionally, a Member who makes a false or misleading statement to obtain
retirement benefits shall commit a misdemeanor of the first degree and if convicted,
the Member shall forfeit his/her benefit.
CLAIMS REVIEW PROCEDURE
All claims for benefits should begin with the Pension Coordinator. It is the
responsibility of the Pension Coordinator to help you (or your beneficiary) in
completing the required forms. If you are unable to visit the Pension Coordinator,
you may write or telephone for assistance. The Pension Coordinator will explain
how to proceed with a claim for benefits.
All claims for benefits are placed on the agenda, usually of a regularly scheduled
meeting of the Board of Trustees. No benefits can be paid without Board approval.
The Board announces all meetings in advance and Members have the right to
attend all Board Meetings. However, a Member is not required to attend the Board
meeting where the Member's claim is being heard.
Any member, former member, or beneficiary who has been denied a benefit by a
decision of the Board shall be entitled to request in writing that the Board give
further consideration to the claim. The Board shall review the case and issue an
order within 60 days after receipt of the written request.
Within 90 days after receipt of the order of the Board, the Member may request in
writing, a hearing. The Board shall then conduct a hearing within the next 90 days.
The claimant maybe represented at the hearing by an attorney or other representa-
tive of his/her choosing. During the hearing the claimant sh'atf have the opportunity
to submit written and oral evidence and arguments in support of his/her claim. The
claimant shall also have the opportunity to review the Board's file at or prior to the
hearing. Either the claimant of the Board may request that a court reporter record
the proceedings. In this event a complete written transcript of the proceedings shall
be furnished to both parties at the expense of the party requesting the attendance
of the court reporter.
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A final written decision shall be made by the Board within 30 days of such hearing.
The written decision shall include the reasons for such decision, and such decision
shall be final.
COST OF THE PENSION FUND
Members are required to contribute 5.00% of covered salary. Contributions are
deducted from each paycheck and credited to the Member's Pension Fund account.
The Village of Tequesta also contributes to the Pension Fund. The amount of
Village contribution is mathematically determined in accordance with State statutes
to finance Pension Fund benefits as they are earned.
ADMINISTRATION OF THE PENSION FUND
The Pension Fund is administered by a Board of Trustees which is responsible for
overseeing the investment of Pension Fund assets and application of the provisions
of the Village Code. The Board has authority over distribution of all pensions and
makes final decisions on claims and appeals. Five trustees comprise the Board:
two legal residents of the Village appointed by the Village Commission, two full-time
General Employees elected by Pension Fund Members and a trustee chosen by the
majority of the other four trustees. However, if either of the two (2) general
employee positions remains vacant for three months or more, then the position can
be filled by a legal resident of the Village, elected by the General Employee
Members of the System in accordance with the election rules established by the
Board, for one term. At the end of the term the position will be posted again to be
filled by a full time general employee.
Pension Fund assets are maintained and invested entirely separate from Village
assets and cannot be used for any purpose other than those specified in the Village
Code.
INVESTMENTS
The assets of the Plan are presently invested by Dana Investment Advisors under
investment guidelines adopted by the Board of Trustees in consultation with their
investment advisors.
Village of Tequesta General May 2009
Employees Pension Fund Page 10
ACTUARIAL SOUNDNESS
The actuary for the Plan has determined that the Plan is actuarially sound and can
adequately fund the benefits based upon projected contributions to the Plan and
investment earnings.
AGENT FOR SERVICE OF LEGAL PROCESS
Board of Trustees
Hanson, Perry & Jensen, P.A.
400 Executive Center Drive, Suite 207
West Palm Beach, Florida 33401-2922
PLAN YEAR
The plan year is the twelve month period beginning each October 1. Records are
kept on a fiscal year basis.
Village of Tequesta General May 2009
Employees Pension Fund Page 11
ACTUARIAL DATA
Village of Tequesta General May 2009
Employees Pension Fund Page 12
INCOME AND DISBURSEMENTS
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Employees Pension Fund Page 73