HomeMy WebLinkAboutDocumentation_Pension General_Tab 05_02/01/2010)^
VILLAGE OF TEQUESTA GENERAL EMPLOYEES PENSION TRUST FUND
ACTUARIAL VALUATION REPORT AS OF OCTOBER 1, 2009
ANNUAL EMPLOYER CONTRIBUTION IS DETERMIlVED BY THIS VALUATION FOR THE
PLAN YEAR ENDING SEPTEMBER 30, 2011
GRS
^
^
^
^
^
^
^
^
^
^
^
^
^
^
^
^ GRS
^ ~ Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1616 phone
Consultants & Actuaries Suite 505 954.525.0083 fax
^ Ft. Lauderdale, FL 33301-1827 www.gabrielroeder.com
^
^
December 4, 2009
Board of Trustees
Village of Tequesta General Employees
Pension Trust Fund
Tequesta, Florida
Dear Board Members:
We are pleased to present our October 1, 2009 Actuarial Valuation Report for the Plan. The purpose of the
Report is to set forth required contribution levels, to disclose plan assets and actuarial liabilities, to comment
on funding progress and to provide supporting information regarding the operation of the Plan. This Report
is also designed to comply with requirements of the State.
The valuation was performed on the basis of employee, retiree and fmancial information supplied by the
City. Although we did not audit this information, it was reviewed for reasonableness and comparability to
prior years.
The benefits valued are outlined at the end of the Report. Actuarial assumptions and the actuarial cost
method are also described herein. Any changes in benefits, assumptions or methods are described in the
first section.
As indicated below, the undersigned is a Member of the American Academy of Actuaries (MAAA) and
meets the Qualification Standards of the Academy of Actuaries to render the actuarial opinion herein.
We will be pleased to answer any questions pertaining to the valuation and to meet with you to review this
Report.
Respectfully submitted,
GABRIEL, ROEDER, SMITH AND COMPANY
^ J tephe Palmquist, AS AAA, FCA
Enrolled Actuary No. 08-1560
oLJ~t~id-~,C ~~c~i~-G~'°~
,
Duane Howison, FSA
Enrolled Actuary No. 08-6169
Statement by Enrolled Actuary
This actuarial valuation and/or cost determination was prepared and completed by me or under my
direct supervision, and I acknowledge responsibility for the results. To the best of my knowledge, the
results are complete and accurate. In my opinion, the techniques and assumptions used are reasonable, meet
the requirements and intent of Part VII, Chapter 112, Florida Statutes, and are based on generally accepted
actuarial principles and practices. There is no benefit or expense to be provided by the plan and/or paid
from the plan's assets for which liabilities or current costs have not been established or otherwise taken into
account in the valuation. All known events or trends which may require a material increase in plan costs or
required contribution rates have been taken into account in the valuation.
Signature
/~- ~- ~0
Date
08-1560
Enrollment Number
GRS
^
TABLE OF CONTENTS
Section Title Page
A Discussion of Valuation Results 1
B Valuation Results
1. Summary of Valuation Results 3
2. Derivation of Employer Normal Cost 4
3. Actuarial Gains and Losses 5
4. Actual Compared to Expected Decrements 6
5. Actuarial Assumptions and Cost Method 7
6. Glossary of Terms 10
C Pension Fund Information
1. Summary of Assets 13
2. Summary of Income and Disbursements 14
3. Actuarial Value of Assets 15
4. History of Investment Return Rates 16
D Financial Accounting Information
1. FASB No. 35 17
2. GASB No. 25 18
3. GASB No. 27 20
E Miscellaneous Information
1. Reconciliation of Membership Data 22
2. Statistical Data 23
3. Age and Service Distributions 24
F Summary of Plan Provisions 26
GRS
^
SECTION A
DISCUSSION OF VALUATION RESULTS
GRS
^
1
DISCUSSION OF VALUATION RESULTS
Comparison of Required Employer Contributions
The following is a schedule of required contributions developed in this year's and the previous
actuarial valuations:
For FYE For FYE Increase
09/30/11 09/30/10 (Decrease)
Required >;mployer Contribution $ 184,818 $ 146,158 $ 38,660
of Payroll 9.40 % 7.85 % 1.55
The required employer contribution was calculated under the assumption that payment would be
made in equal installments at the end of each month.
Changes in Benefits
There have been no changes in benefits since the previous valuation.
Change in Actuarial Assumptions and Methods
There have been no changes in actuarial assumptions and methods since the previous valuation.
Actuarial Experience
Overall experience since the last valuation has been unfavorable resulting in an actuarial loss of
$87,629. The loss is primarily due to lower than expected investment return. The actuarial loss has caused
the required contribution to increase by 0.56% of covered payroll. The required contribution also increased
by about 1.0% of payroll due to the increase in administrative expenses.
Funding Ratio
The funded ratio was 109.2% this year compared to 119.4% last year. The funded ratio is equal to
the actuarial value of assets divided by the actuarial accrued liability.
Variability of Future Contribution Rates
The Actuarial Cost Method used to determine the contribution rate is intended to produce
GRS
2
^ contribution rates which are generally level as a percent of payroll. Even so, when experience differs
^ from the assumptions, as it often does, the employer's contribution rate can vary significantly from year-
to-year.
^ Over time, if the year-to-year gains and losses offset each other, the contribution rate would be
^ expected to return to the current level, but this does not always happen.
^ The Actuarial Value of Assets exceeds the Market Value of Assets by $195,167 as of the
^ valuation date (see Section C). This difference will be gradually recognized over the next five years in
^ the absence of offsetting gains. In turn, the computed employer contribution rate will increase by
^ approximately 1.25% of covered payroll over the same period.
. Relationship to Market Value
^ If Market Value had been the basis for the valuation, the City contribution rate would have been
. 10.65%. In the absence of other gains and losses, the City contribution rate should increase to this value
over the next several years.
The remainder of this Report includes detailed actuarial valuation results, financial information,
miscellaneous information and statistics, and a summary of plan provisions.
~ GRS
^
^
SECTION B
VALUATION RESULTS
GRS
^
3
GENERAL EMPLOYEES
SUMMARY OF VALUATION RESULTS
As of October 1
2009 2008
COVERED GROUP
A. Number Included in the Valuation
1. Active Members 35 36
2. Inactive Members 3 2
B. Covered Annual Payroll $ 1,890,529 $ 1,790,280
LONG RANGE COST
C. Actuarial Present Value of Projected Benefits 3,409,718 3,058,746
D. Actuarial Value of Assets 1,465,279 1,235,850
E. Actuarial Present Value of Future Contrib.
1. Total C - D 1,944,439 1,822,896
2. Portion Assigned to Unfunded Frozen
Actuarial Accrued Liability (UFAAL) 0 0
3. Portion Assigned to Future Normal Costs 1,944,439 1,822,896
CURRENT ANNUAL COST
F. Annual Payment Needed to Amortize UFAAL 0 0
As % of B --- ---
G. Annual Employer Normal Cost 171,076 135,170
As % of B 9.05 % 7.55
H. Interest on F + G from Valuation Date to
Contribution Date(s) 6,719 5,308
As % of B 0.36 % 0.30
I. Required, Employer Contribs: F + G + H 177,795 140,478
J. ARC as % of Covered Payroll 9.40 % 7.85
K. Assumed Rate of Increase in Covered
Payroll to Contribution Year 4.00 % 4.00%
L. Covered Payroll for Contribution Year 1,966,150 1,861,891
M. ARC for Contribution Year: J x L 184,818 146,158
N. Year to which Contributions Apply
1. Plan Year Ending 9/30/11 9/30/10
2. Employer Fiscal Year Ending 9/30/11 9/30/10
3. Assumed Date(s) of Employer Contribs. Monthly Monthly
GRS
^
GENERAL EMPLOYEES
DERIVATION OF EMPLOYER NORMAL COST
As of October 1
2009 2008
A. Actuarial Present Value of Projected
Benefits for
1. Active Members
a. Service Retirement Benefits $ 2,767,833 $ 2,487,673
b. Vesting Benefits 144,055 124,789
c. Disability Benefits 348,081 328,178
d. Preretirement Death Benefits 40,372 41,455
e. Return of Member Contributions 29,446 30,308
£ Other 0 0
g. Total 3,329,787 3,012,403
2. Inactive Members
a. Service Retirees & Benefits 0 0
b. Disability Retirees 0 0
c. Terminated Vested Members 79,931 46,343
d. Total 79,931 46,343
3. Total for All Members 3,409,718 3,058,746
B. Actuarial Value of Assets 1,465,279 1,235,850
C. Actuarial Present Value of Projected
Member Contributions 811,384 796,820
D. Actuarial Present Value of Projected
Employer Normal Costs: A3 - B - C 1,133,055 1,026,076
E. Actuarial Present Value of Projected
Covered Payroll 16,227,679 15,936,404
F. Employer Normal Cost Rate: 100 x D/E 6.98 % 6.44
G. Annual Payroll of Active Members 1,890,529 1,790,280
H. Assumed Amount of Administrative
Expenses 39,117 19,876
I. Employer Normal Cost: (F x G) + H 171,076 135,170
J. Employer Normal cost as % of
Covered Payroll 9.05 % 7.55
GRS
4
^
s
^
5
ACTUARIAL GAINS AND LOSSES
When the actual plan experience differs from the actuarial assumptions, an actuarial gain or loss is
the result. The net actuarial gain (loss) since the last valuation is computed as follows:
A. Normal Cost Rate
1. Last Year 6.44%
2. This Year 6.98
3. Change (0.54)
B. Present Value of Projected Payroll $16,227,679
C. Actuarial Gain (Loss) : A3 x B (87,629)
The fund earnings and salary increase assumptions have considerable impact on the cost of the Plan
so it is important that they are in line with the actual experience. The following table shows the actual fund
earnings and salary increase rates compared to the assumed rates for the last few years:
Investment Return Salary Increases
Year Ending
9/30
Actual
Assumed
Actual
Assumed
1998 NA% 8.0% 8.9% 6.0%
1999 NA 8.0 6.0 6.0
2000 NA 8.0 11.1 6.0
2001 NA 8.0 28.8 6.0
2002 NA 8.0 12.0 6.0
2003 * 1.2 8.0 3.9 6.0
2004 1.9 8.0 5.0 6.0
2005 11.1 8.0 4.9 6.0
2006 8.4 8.0 6.7 6.0
2007 9.8 8.0 8.6 6.0
2008 (11.6) 8.0 5.8 6.0
2009 3.0 7.5 5.4 6.0
Averages 3.1 6.7
* Start Investment Return for General Only
The actual investment return rates shown above are based on the actuarial value of assets. The
actual salary increase rates shown above are the increases received by those active members who were
included in the actuarial valuation both at the beginning and the end of each period.
GRS
r
^
^
^
^
^
^
^
^
^
^
i
^
^
^
^
6
Actual (A) Compared to Expected (E) Decrements
Among Active Employees
Number
Added Service & Active
During DROP Disability Terminations Members
Year Year Retirement Retirement Death Vested Other To tals End of
Ended A E A E A E A E A A A E Year
9/30/2006 13 5 0 0 0 0 0 0 0 5 5 1 32
9/30/2007 6 8 0 0 0 0 0 0 1 7 8 1 30
9/30/2008 11 5 0 0 0 0 0 0 1 4 5 1 36
9/30/2009 2 3 0 0 0 0 0 0 1 2 3 2 35
9/30/2010 0 0 0 2
4 Yr Totals * 32 21 0 0 0 0 0 0 3 18 21 5
* Totals are through current Plan Year only
GRS
ACTUARIAL ASSUMPTIONS AND COST METHOD
Valuation Methods
Actuarial Cost Method -Normal cost and the allocation of benefit values between service rendered
before and after the valuation date were determined using the Aggregate Method. The excess of the
Actuarial Present Value of Projected Benefits of the group included in the valuation, over the sum of the
Actuarial Value of Assets and the Actuarial Present Value of Future Member Contributions (if any) is
^ allocated as a level percentage of earnings of the group between the valuation date and the assumed
retirement age. This allocation is performed for the group as a whole, not as a sum of individual allocations.
The portion of this Actuarial Present Value allocated to a specific year is called the Employer Normal Cost.
^ Under this method, actuarial gains and losses, plan amendments, and changes in actuarial assumptions and
methods reduce or increase future Normal Costs.
Actuarial Value of Assets -The Actuarial Value of Assets is equal to the difference between actual and
^ expected returns recognized over five years. The Actuarial Value of Assets will be further adjusted to the
extent necessary to fall within the corridor whose lower limit is 80% of the Market Value of plan assets
^ and whose upper limit is 120% of the Market Value of plan assets. During periods when investment
performance exceeds the assumed rate, Actuarial Value of Assets will tend to be less than Market Value.
^ During periods when investment performance is less than assumed rate, Actuarial Value of Assets will
tend to be greater than Market Value.
Valuation Assumptions
^ The actuarial assumptions used in the valuation are shown in this Section.
Economic Assumptions
^ The investment return rate assumed in the valuations is 7.5% per year, compounded annually (net after
investment expenses).
The Wage Inflation Rate assumed in this valuation was 4.0% per year. The Wage Inflation Rate is
^ defined to be the portion of total pay increases for an individual that are due to macroeconomic forces
including productivity, price inflation, and labor market conditions. The wage inflation rate does not
^ include pay changes related to individual merit and seniority effects.
. The assumed real rate of return over wage inflation is defined to be the portion of total investment
return that is more than the assumed wage inflation rate. Considering other economic assumptions, the
^ 7.5% investment return rate translates to an assumed real rate of return over wage inflation of 3.5%.
Pay increase assumptions for individual active members are assumed to be 6% each year up to the
^ assumed retirement age.
Demographic Assumptions
^ The mortality table was the RP -2000 Generational Mortality Table for males and females as shown on
the next page.
~ GRS
^
^
^
8
Sample Probability of Future Life
Attained Dying Next Year Expectancy (years)
Ages (in 2008) Men Women Men Women
50 0.18 % 0.15 % 33.71 35.32
55 0.31 0.25 28.61 30.37
60 0.59 0.49 23.71 25.61
65 1.14 0.93 19.14 21.13
70 1.97 1.61 15.01 17.03
75 3.38 2.64 11.32 13.34
80 5.94 4.34 8.21 10.08
This assumption is used to measure the probabilities of each benefit payment being made after retirement.
For active members, the probabilities of dying before retirement were based upon the same mortality table
as members dying after retirement.
For disabled retirees, the regular mortality tables are set forward 5 years in ages to reflect impaired
longevity.
The rate of retirement is assumed to be 100% upon reaching normal retirement age. Probability of early
retirement is 5% for each year eligible.
Rates of separation from active membership were as shown below (rates do not apply to members
eligible to retire and do not include separation on account of death or disability). This assumption
measures the probabilities of members remaining in employment.
Rates of disability among active members were as shown below.
A e Termination
Rates
Disabili Rates
20 12.4% 0.07%
25 11.7 0.09
30 10.5 0.11
35 8.3 0.14
40 5.7 0.19
45 3.5 0.30
50 1.5 0.51
55 0.6 0.96
60 0.5 1.66
GRS
^
9
Miscellaneous and Technical Assumptions
Administrative & Investment The investment return assumption is intended to be the return net of
Expenses investment expenses. Annual administrative expenses are assumed to
be equal to the actual expenses incurred in the most recent year.
Assumed administrative expenses are added to the Normal Cost.
Benefit Service Exact fractional service is used to determine the amount of benefit
payable.
Decrement Operation Disability and mortality decrements operate during retirement
eligibility.
Decrement Timing Decrements of all types are assumed to occur at the beginning of the
year.
Eligibility Testing Eligibility for benefits is determined based upon the age nearest
birthday and service nearest whole year on the date the decrement is
assumed to occur.
Forfeitures For vested separations from service, it is assumed that 0% of members
separating will withdraw their contributions and forfeit an employer
financed benefit. It was further assumed that the liability at
termination is the vested deferred benefit (if any).
Incidence of Contributions Employer contributions are assumed to be made at the end of each
month throughout the year.
Marriage Assumption 100% of males and 100% of females are assumed to be married for
purposes of death-in-service benefits. Male spouses are assumed to be
three years older than female spouses for active member valuation
purposes.
Normal Form of Benefit
Pay Increase Timing
Service Credit Accruals
GRS
A ten year certain and life annuity is the normal form of benefit.
Beginning of fiscal year.
It is assumed that members accrue one year of service credit per year.
. 10
^ GLOSSARY
Actuarial Accrued Liability The difference between the Actuarial Present Value of Future Benefits,
^ (AAL) and the Actuarial Present Value of Future Normal Costs.
^ Actuarial Assumptions Assumptions about future plan experience that affect costs or liabilities,
such as: mortality, withdrawal, disablement, and retirement; future
^ increases in salary; future rates of investment earnings; future investment
and administrative expenses; characteristics of members not specified in the
^ data, such as marital status; characteristics of future members; future
elections made by members; and other items.
Actuarial Cost Method A procedure for allocating the Actuarial Present Value of Future Benefits
^ between the Actuarial Present Value of Future Normal Costs and the
Actuarial Accrued Liability.
Actuarial Equivalent Of equal Actuarial Present Value, determined as of a given date and based
on a given set of Actuarial Assumptions.
Actuarial Present Value The amount of funds required to provide a payment or series of payments
. (APT7 in the future. It is determined by discounting the future payments with an
assumed interest rate and with the assumed probability each payment will
^ be made.
Actuarial Present Value of The Actuarial Present Value of amounts which are expected to be paid at
Future Benefits (APVFB) various future times to active members, retired members, beneficiaries
. receiving benefits, and inactive, nonretired members entitled to either a
refund or a future retirement benefit. Expressed another way, it is the value
^ that would have to be invested on the valuation date so that the amount
invested plus investment earnings would provide sufficient assets to pay all
projected benefits and expenses when due.
. Actuarial Valuation The determination, as of a valuation date, of the Normal Cost, Actuarial
Accrued Liability, Actuarial Value of Assets, and related Actuarial Present
Values for a plan. An Actuarial Valuation for a governmental retirement
system typically also includes calculations of items needed for compliance
with GASB No. 25, such as the Funded Ratio and the Annual Required
^ Contribution (ARC).
^ Actuarial Value of Assets The value of the assets as of a given date, used by the actuary for
valuation purposes. This may be the market or fair value of plan assets or
^ a smoothed value in order to reduce the year-to-year volatility of
calculated results, such as the funded ratio and the actuarially required
. contribution (ARC).
^ Annual Required The employer's periodic required contributions, expressed as a dollar
Contribution (ARC) amount or a percentage of covered plan compensation, determined under
GASB No. 25. The ARC consists of the Employer Normal Cost and
Amortization Payment.
~ GRS
^
^ 11
Closed Amortization Period A specific number of years that is reduced by one each year, and declines to
zero with the passage of time. For example if the amortization period is
^ initially set at 30 years, it is 29 years at the end of one year, 28 years at the
end of two years, etc.
Employer Normal Cost The portion of the Normal Cost to be paid by the employer. This is equal
S to the Normal Cost less expected member contributions.
Equivalent Single For plans that do not establish separate amortization bases (separate
Amortization Period components of the UAAL), this is the same as the Amortization Period.
For plans that do establish separate amortization bases, this is the period
over which the UAAL would be amortized if all amortization bases were
combined upon the current UAAL payment.
^ Experience Gain/Loss A measure of the difference between actual experience and that expected
based upon a set of Actuarial Assumptions, during the period between two
^ actuarial valuations. To the extent that actual experience differs from that
assumed, Unfunded Actuarial Accrued Liabilities emerge which may be
larger or smaller than projected. Gains are due to favorable experience, e.g.,
the assets earn more than projected, salaries do not increase as fast as
assumed, members retire later than assumed, etc. Favorable experience
^ means actual results produce actuarial liabilities not as large as projected by
the actuarial assumptions. On the other hand, losses are the result of
unfavorable experience, i.e., actual results that produce Unfunded Actuarial
Accrued Liabilities which are larger than projected.
Funded Ratio The ratio of the Actuarial Value of Assets to the Actuarial Accrued
Liability.
GASB Governmental Accounting Standards Board.
. GASB No. 25 and These are the governmental accounting standards that set the accounting
GASB No. 27 rules for public retirement systems and the employers that sponsor or
^ contribute to them. Statement No. 27 sets the accounting rules for the
employers that sponsor or contribute to public retirement systems, while
. Statement No. 25 sets the rules for the systems themselves.
^ Normal Cost The annual cost assigned, under the Actuarial Cost Method, to the current
^ plan year.
Open Amortization Period An open amortization period is one which is used to determine the
Amortization Payment but which does not change over time. In other
^ words, if the initial period is set as 30 years, the same 30-year period is
used in determining the Amortization Period each year. In theory, if an
Open Amortization Period is used to amortize the Unfunded Actuarial
Accrued Liability, the UAAL will never completely disappear, but will
become smaller each year, either as a dollar amount or in relation to
covered payroll.
Unfunded Actuarial Accrued The difference between the Actuarial Accrued Liability and Actuarial
^ Liability Value of Assets.
~ GRS
^
^
12
Valuation Date The date as of which the Actuarial Present Value of Future Benefits are
determined. The benefits expected to be paid in the future are discounted to
this date.
GRS
i
^
^
GRS
SECTION C
PENSION FUND INFORMATION
13
SUMMARY OF ASSETS
9/30/09 9/30/08
Cash and Securities -Market Value
Cash $ 11,489 $ 0
Money Market Funds 60,229 23,760
Treasury and Agency Bonds & Notes 224,350 270,132
Corporate and Foreign Bonds 142,291 79,920
Cormnon Stocks (Domestic) 661,084 680,631
Pooled Equity Funds --- ---
Pooled Bond Funds 67,223 ---
International Equity 93,496 ---
Total 1,260,162 1,054,443
Receivables
Accrued Interest 5,268 5,074
Employer Contribution 7,298 ---
Employee Contribution 4,528 ---
Contributions Receivable --- 10,136
Total Receivables 17,094 15,210
Payables
6,531 7,456
Accounts Payable 618 ---
Due to Broker 7,149 7,456
Total Payables
Net Assets -Market Value 1,270,107 1,062,197
GRS
^
14
PENSION FUND INCOME AND DISBURSEMENTS
Year Ending Year Ending
9/30/09 9/30/08
Market Value at Beginning of Period $ 1,062,197 $ 1,026,897
Income
Member Contributions 87,722 81,057
State Contributions --- ---
Employer Contributions 141,407 130,665
Other Contributions --- ---
Investment Income
Interest and Dividends 31,370 30,866
Realized Gain (Loss) (32,303) (17,661)
Unrealized Gain (Loss) 36,267 (126,823)
Total 35,334 (113,618)
Other Income 5 ---
Total Income 264,468 98,104
Disbursements
Monthly Benefit Payments --- ---
Lump Sum Distributions --- ---
Refunds of Contributions 610 28,178
Investment Related Expense 16,712 14,750
Other Administrative Expense 39,117 19,876
Insurance Premiums --- ---
Other Expense 119 ---
Total Disbursements 56,558 62,804
Net Increase During Period 207,910 35,300
Market Value at End of Period 1,270,107 1,062,197
GRS
Tequesta General Employees' Trust Fund
Development of Actuarial Value of Assets
Year Ending September 30
2008 2009 2010 2011 2012
A. Beginning of Year Assets
1. Mazket Value $ 1,026,897 $ 1,062,197 $ $ $
2. Actuarial Value 1,026,897 1,235,850
B. Net of Contributions
Less Disbursements 163,669 189,288
C. Actual Net Investment
Earnings (128,368) 18,622
D. Expected Investment
Earnings 88,698 99,787
E. Excess of Actual Over
Expected Investment
Eaznings: C - D (217,066) (81,165)
F. Recognition of Excess
Earnings Over 5 Yeazs
1. From This Yeaz (43,413) (16,233) 0 0 0
2. From One Year Ago 0 (43,413) (16,233) 0 0
3. From Two Years Ago 0 0 (43,413) (16,233) 0
4. From Three Years Ago 0 0 0 (43,413) (16,233)
5. From Four Years Ago 0 0 0 0 (43,413)
6. Total (43,413) (59,646) (59,646) (59,646) (59,646)
G. End of Year Assets
1. Mazket Value 1,062,197 1,270,107
2. Actuarial Value:
A2 + B + D + F6 1,235,850 1,465,279
3. Final Actuarial Value
Within 80% to 120%
Of Market Value 1,235,850 1,465,279
^
16
History of Investment Return Rates
Plan Year Ending
September 30 of Market
Actuarial
2003 1.2% 1.2%
2004 1.9% 1.9%
2005 11.1 % 11.1
2006 8.4% 8.4%
2007 9.8% 9.8%
2008 (11.6)% 4.1
2009 1.6% 3.0%
Average returns:
Last five years: 3.5% 7.2%
Last ten years: NA NA
The above rates are based on the retirement systems financial information reported to the actuary. They may
differ from figures that the investment consultant reports, in part because of differences in the handling of
administrative and investment expenses, and in part because of differences in the handling of cash flows.
GRS
^
GRS
SECTION D
FINANCIAL ACCOUNTING INFORMATION
17
FASB N0.35 INFORMATION
10/1/09 10/1/08
A. Actuarial Present Value of Accumulated Plan
Benefits
1. Vested Benefits
a. Members Currently Receiving Payments $ 0 $ 0
b. Terminated Vested Members 79,931 46,343
c. Other Members 134,806 91,670
d. Total 214,737 138,013
2. Non-Vested Benefits 1,000,068 849,731
3. Total Actuarial Present Value of Accumulated
P1anBenefit:ld+2 1,214,805 987,744
4. Accumulated Contributions of Active Members 343,663 251,752
$. Changes in the Actuarial Present Value of
Accumulated Plan Benefits
1. Total Value at Beginning of Period 987,744 689,287
2. Increase (Decrease) During the Period Attributed to:
a. Plan Amendment NA NA
b. Change in Actuarial Assumption NA 76,471
c. Latest Member Data, Benefits Accumulated
and Decrease in the Discount Period. 226,451 250,164
d. Benefits Paid 610 (28,178)
e. Net Increase 227,061 298,457
3. Total Value at End of Period 1,214,805 987,744
C. Market Value of Assets 1,270,107 1,062,197
GRS
~I J
SCHEDULE OF FUNDING PROGRESS
(GASB Statement No. 25)
Actuarial
Accrued
Actuarial Value Liability (AAL) Unfunded AAL UAAL As % of
Actuarial of Assets -Entry Age (UAAL) Funded Ratio Covered Payroll Covered Payroll
Valuation Date (a) (b) (b - a) (a/b) (c -a /c
10/1/98 $ 934,659 $ 532,439 $ (402,220) 175.5% $ 967,853 (41.6)%
10/1/00 1,683,867 834,839 (849,028) 201.7 1,203,923 (70.5)
10/1/02* 248,725 222,882 (25,843) 111.6 866,467 (3.0)
10/1/03 333,944 265,486 (68,458) 125.8 1,056,797 (6.5)
10/1/OS 602,280 429,242 (173,038) 140.3 1,098,039 (15.8)
10/1/07 1,026,897 764,571 (262,326) 134.3 1,500,201 (17.5)
10/1/08 1,235,850 1,034,855 (200,995) 119.4 1,790,280 (11.2)
10/1/09 1,465,279 1,341,518 (123,761) 109.2 1,890,529 (6.5)
* Start General Plan only.
i
^
^
^
^
^
^
i
^
^
^
^
19
SCHEDULE OF EMPLOYER CONTRIBUTIONS
(GASB Statement No. 25)
Fiscal Year Ended
Se tember 30 Annual Required
Contribution Actual
Contributions Percentage
Contributed
1997 $ 11,399 $ 11,400 100.0%
1998 13,440 13,440 100.0
1999 17,456 17,456 100.0
2000 17,456 26,053 149.2
2001 12,887 36,983 287.0
2002 41,607 48,124 115.7
2003 64,723 69,869 108.0
2004 92,218 92,218 100.0
2005 95,949 95,949 100.0
2006 88,512 91,230 103.1
2007 92,042 122,449 133.0
2008 88,790 130,665 147.2
2009 92,364 141,407 153.1
GRS
^
20
ANNUAL PENSION COST AND NET PENSION OBLIGATION
(GASB STATEMENT N0.27)
GENERAL EMPLOYEES
Employer FYE September 30 2010 2009
A. Annual Required Contribution (ARC) $ 146,158 $ 92,364
B. Interest on Net Pension Obligation (NPO) (11,871) (8,479)
C. Adjustment to ARC (17,879) (12,294)
D. Annual Pension Cost (APC) (A+B-C) 152,166 96,179
E. Contributions made ** 141,407
F. NPO at beginning of year (158,284) (113,056)
G. Increase (decrease) in NPO (D-E) ** (45,228)
H. NPO at end of year (F+G) ** (158,284)
THREE YEAR TREND INFORMATION
2008
$ 88,790
(5,924)
(8,799)
91,665
130,665
(74,056)
(39,000)
(113,056)
Fiscal Annual Pension Actual Percentage of Net Pension
Year Ending Cost (APC) Contribution APC Contributed Obligation
9/30/2007 $ 92,789 $ 122,449 132.0 % $ (74,056)
9/30/2008 91,665 130,665 142.5 (113,056)
9/30/2009 96,179 141,407 147.0 (158,284)
GRS
^
21
REQUIRED SUPPLEMENTARY INFORMATION
GASB Statement No. 25 and No. 27
The information presented in the required supplementary schedules was determined as part of the actuarial
valuations at the dates indicated. Additional information as of the latest actuarial valuation:
Valuation date October 1, 2009
Contribution Rates
Employer (and State) 9.40%
Plan members 5%
Actuarial Cost Method Aggregate
Amortization Method NA
Remaining amortization period NA
Asset Valuation Method Five year smoothed
Actuarial Assumptions
Investment rate of return 7.5%
Projected salary increases 6.0%
Includes inflation and other general increases at 4.0%
Cost of Living adjustments Not Applicable
GRS
^
SECTION E
MISCELLANEOUS INFORMATION
GRS
~I
RECONCILIATION OF MEMBERSIiIP DATA
A. Active Members 10/1/08 to 10/1/07 to
10/1/09 10/1/08
1. Number Included in Last Valuation 36 30
2. New Members Included in Current Valuation 2 11
3. Non-Vested Employment Terminations (2) (4)
4. Vested Employment Terminations (1) (1)
5. Service Retirements 0 0
6. Disability Retirements 0 0
7. Deaths 0 0
8. Other 0 0
9. Number Included in This Valuation 35 36
B. Terminated Vested Members
1. Number Included in Last Valuation 2 1
2. Additions from Active Members 1 1
3. Lump Sum Payments 0 0
4. Payments Commenced 0 0
5. Deaths 0 0
6. Other 0 0
7. Number Included in This Valuation 3 2
C. Service Retirees, Disability Retirees and Beneficiaries
1. Number Included in Last Valuation 0 0
2. Additions from Active Members 0 0
3. Additions from Terminated Vested Members 0 0
4. Deaths Resulting in No Further Payments 0 p
5. Deaths Resulting in New Survivor Benefits 0 0
6. End of Certain Period - No Further Payments 0 0
7. Other 0 0
8. Number Included in This Valuation 0 0
N
N
r
^
23
STATISTICAL DATA
GENERAL EMPLOYEES
10/1/OS 10/1/07 10/1/08 10/1/09
Active Members
Number 24 30 36 35
Total Annual Payroll $ 1,098,039 $ 1,500,201 $ 1,790,280 $ 1,890,529
Average Annual Salary 45,752 50,007 49,730 54,015
Other Averages
Current Age 43.1 44.3 42.9 44.0
Age at Employment 40.6 41.1 39.9 40.1
Past Service 2.5 3.2 3.0 3.9
Service Retirees and Beneficiaries
Number 0 0 0 0
Total Annual Benefit $ --- $ --- $ --- $ ---
Average Monthly Benefit --- --- --- ---
Disability Retirees
Number 0 0 0 0
Total Annual Benefit $ --- $ --- $ --- $ ---
Average Monthly Benefit --- --- ---
Terminated Members With Vested Benefits
Number 0 0 2 3
Total Annual Benefit $ --- $ --- $ 9,144 $ 13,164
Average Monthly Benefit --- --- 381 366
GRS
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
~n
Tequesta General 10/1/09 Val
Age ------------------ Years of Service to Valuation Date --------- ---------- -------- -Totals--------
Group 0-4 5-9 10-14 15-19 20-24 25-29 30 & Up No. Salary Average
0- 4 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
5- 9 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
10-14 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
15-19 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
20-24 2. 0. 0. 0. 0. 0. 0. 2. 70261. 35131.
25-29 1. 0. 0. 0. 0. 0. 0. 1. 31303. 31303.
30-34 5. 1. 0. 0. 0. 0. 0. 6. 268901. 44817.
35-39 5. 0. 0. 0. 0. 0. 0. 5. 210882. 42176.
40-44 1. 1. 0. 0. 0. 0. 0. 2. 135133. 67567.
45-49 5. 0. 0. 0. 0. 0. 0. 5. 211925. 42385.
50-54 5. 3. 0. 0. 0. 0. 0. B. 381688. 47711.
55-59 2. 2. 0. 0. 0. 0. 0. 4. 268538. 67135.
60 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
61 0. 1. 0. 0. 0. 0. 0. 1. 102876. 102876.
62 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
63 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
64 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
65 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
66 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
67 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
68 1. 0. 0. 0. 0. 0. 0. 1. 102011. 102011.
69 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
70 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
71 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
72 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
73 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
74 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
75 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
76 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
77 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
78 0. 0. 0. 0. 0. 0. 0. 0. 0. 0.
79 0.
------ 0.
------ 0.
------ -- 0.
---- ---- 0.
-- 0.
---- 0. 0. 0. 0.
Totals
27.
8.
0.
0.
0. --
0. ------
0. --------
35. -------------
1783518.
50958.
N
~n
---Termi nated Vested--- -------Disabled-------- -----Age & Service----- ---------Other---------
Total Total Total Total
Age Number Benefits Nvmber Benefita Number Benefits Number Benefits
Under 20 0 0. 0 0. 0 0. 0 0.
20 - 24 0 0. 0 0. 0 0. 0 0.
25 - 29 0 0. 0 0. 0 0. 0 0.
30 - 34 0 0. 0 0. 0 0. 0 0.
35 - 39 0 0. 0 0. 0 0. 0 0.
40 - 44 0 0. 0 0. 0 0. 0 0.
45 - 49 0 0. 0 0. 0 0. 0 0.
50 - 54 2 9144. 0 0. 0 0. 0 0.
55 - 59 1 4020. 0 0. 0 0. 0 0.
60 - 64 0 0. 0 0. 0 0. 0 0.
65 - 69 0 0. 0 0. 0 0. 0 0.
70 - 74 0 0. 0 0. 0 0. 0 0.
75 - 79 0 0. 0 0. 0 0. 0 0.
80 - 84 0 0. 0 0. 0 0. 0 0.
85 - 89 0 0. 0 0. 0 0. 0 0.
90 - 94 0 0. 0 0. 0 0. 0 0.
95 - 99 0 0. 0 0. 0 0. 0 0.
100 & Over 0 0. 0 0. 0 0. 0 0.
Total 3 13164. 0 0. 0 0. 0 0.
Ave. Age 54 0 0 0
Liability 79931. 0. 0. 0.
Tequesta General - inactive participants at 10/1/09
S C H H D U L H O F N O N- ACT I V H P ART I C I PANT S D A T A
_________TOtal_________
Total
Number Benefits
0 0.
0 0.
0 0.
0 0.
0 0.
0 0.
0 0,
2 9144.
1 4020.
0 0.
0 0.
0 0.
0 0.
0 0.
0 0.
0 0.
0 0.
0 0.
3 13164.
54
79931.
N
^
SECTION F
SUMMARY OF PLAN PROVISIONS
GRS
^
26
SUMMARY OF PLAN PROVISIONS
A. Ordinances
Plan established under the Code of Ordinances for the Village of Tequesta, Florida, Chapter Z, Article
III, Division 1, Section 2-61 (a), and was most recently amended under Ordinance No. 10-08 passed
and adopted on April 10, 2008. The Plan is also governed by certain provisions of Part VII, Chapter
112, Florida Statutes and the Internal Revenue Code.
B. Effective Date
December 11, 2003
C. Plan Year
October 1 through September 30
D. Type of Plan
Qualified, governmental defined benefit retirement plan; for GASB purposes it is a single employer
plan.
E. Eligibility Requirements
All full-time general employees who are not classified as police officers or firefighters are eligible for
membership on the date of employment.
F. Credited Service
Service is measured as the total number of years and completed months of a year as a general
employee with the Village of Tequesta. No service is credited for any periods of employment for
which the member received a refund of their contributions.
G. Compensation
Base compensation including regular earnings, vacation pay, sick pay, plus all tax-deferred items of
income, but excluding any lump sum payments, overtime, bonuses and longevity bonus.
H. Average Final Compensation (AFC)
The average of Compensation over the highest 5 years during the last 10 years of Credited Service;
does not include lump sum payments of unused leave.
I. Normal Retirement
Eligibility: A member may retire on the first day of the month coincident with or next following
the earlier of
(1) age 62, or
GRS
27
(2) 30 years of Credited Service regardless of age.
Benefit: 2.0% of AFC multiplied by Credited Service with a maximum benefit equal to 100%
of AFC.
Normal Form
of Benefit: 10 Years Certain and Life thereafter; other options are also available.
COLA: None
J. Early Retirement
Eligibility: A member may elect to retire earlier than the Normal Retirement Eligibility upon
attainment of age 50 and 6 years of Credited Service.
Benefit: The Normal Retirement Benefit is reduced by 5.0% for each year by which the Early
Retirement date precedes the Normal Retirement date.
Normal Form
of Benefit: 10 Years Certain and Life thereafter; other options are also available.
COLA: None
K. Delayed Retirement
Same as Normal Retirement taking into account compensation earned and service credited until the
date of actual retirement.
L. Service Connected Disability
Eligibility: Any member who becomes totally and permanently disabled and unable to render
useful and efficient service to the Village as a result from an act occurring in the
performance of service for the Village is immediately eligible for a disability benefit.
Benefit: The accrued Normal Retirement Benefit taking into account compensation earned and
service credited as of the date of disability with a minimum benefit equal to 42% of
AFC.
Normal Form
of Benefit: 10 Years Certain and Life thereafter.
COLA: None
M. Non-Service Connected Disability
Eligibility: Any member who has 6 years of Credited Service and becomes totally and
permanently disabled and unable to render useful and efficient service to the Village
is immediately eligible for a disability benefit.
Benefit: The accrued Normal Retirement Benefit taking into account compensation earned and
service credited as of the date of disability with a minimum benefit equal to 25% of
AFC.
GRS
~-
^ 28
^ Normal Form
of Benefit: 10 Years Certain and Life thereafter.
• COLA: None
N. Death in the Line of Duty
Eligibility: Members are eligible for survivor benefits after the completion of 6 or more years of
Credited Service.
Benefit: The beneficiary will receive the member's accrued Normal Retirement Benefit
taking into account compensation earned and service credited as of the date of death.
The benefit is payable at the member's Normal Retirement date.
Normal Form
^ of Benefit: 10 Years Certain
. COLA: None
^ The beneficiary of a plan member with less than 6 years of Credited Service at the time of death
will receive a refund of the member's accumulated contributions with interest.
^ O. Other Pre-Retirement Death
Eligibility: Members are eligible for survivor benefits after the completion of 6 or more years of
Credited Service.
Benefit: The beneficiary will receive the member's accrued Normal Retirement Benefit
taking into account compensation earned and service credited as of the date of death.
The benefit is payable at the member's Normal Retirement date.
Normal Form
^ of Benefit: 10 Years Certain
. COLA: None
^ The beneficiary of a plan member with less than 6 years of Credited Service at the time of death
will receive a refund of the member's accumulated contributions with interest.
^ P. Post Retirement Death
Benefit determined by the form of benefit elected upon retirement.
^ Q. Optional Forms
^ In lieu of electing the Normal Form of benefit, the optional forms of benefits available to all retirees
are the Life Annuity option or the 50%, 66 2/3%, 75% and 100% Joint and Survivor options.
R. Vested Termination
Eligibility: A member has earned anon-forfeitable right to Plan benefits after the completion of 6
^ years of Credited Service.
Benefit: The benefit is the member's accrued Normal Retirement Benefit as of the date of
^ GRS
w
^
29
termination. Benefit begins on the member's Normal Retirement date. Alternatively,
members can elect a reduced Early Retirement benefit any time after age 50.
Normal Form
of Benefit: 10 Years Certain and Life thereafter; other options are also available.
COLA: None
Members terminating employment with less than 6 years of Credited Service wilt receive a refund of
their own accumulated contributions with interest.
S. Refunds
Eligibility: All members temunating employment with less than 6 years of Credited Service are
eligible. Optionally, vested members (those with 6 or more years of Credited Service)
may elect a refund in lieu of the vested benefits otherwise due.
Benefit: Refund of the member's contributions with interest. Interest is currently credited at a
rate of 3%.
T. Member Contributions
5% of Compensation
U. Employer Contributions
Any additional amount determined by the actuary needed to fund the plan properly according to State
laws.
V. Cost of Living Increases
Not Applicable
W.13`h Check
Not Applicable
X. Deferred Retirement Option Plan
Not Applicable
Y. Other Ancillary Benefits
There are no ancillary retirement type benefits not required by statutes but which might be deemed a
Village of Tequesta General Employees' Pension Trust Fund liability if continued beyond the
availability of funding by the current funding source.
Z. Changes from Previous Valuation
There have been no changes since the last valuation.
GRS