HomeMy WebLinkAboutDocumentation_Regular_Tab 05_01/13/2011 � � VILLAGE OF TEQUESTA
AGENDA ITEM TRANSMITTAI FORM
1. 1/ILLAGE COUNCIL MEETING:
Meeting Date: Meetlng Type: Regular Ordinance #: 14-10
12/9/10
Consent Agenda: No Resolution �: CG�ck herE- to er,t�r text.
Ortginatine Departmsnt: Public Safsty Penslor� Board
2. AGENDA ITEM TITLE: (V1/a�ding form the SUBJECT line of your staff report)
1. Ordinanco 1410. Firat Readin� Amending Exhibit "B" of Section 2-30 of the Code of
Ordinances Village of Tequesta Relating to tt� Public Safety Pension Trust Funds; Providing
for Increased Investmen� in Fore�n Securities — Pubiic Safety Pension Boarol
3. BUDGET / FINANCIAL IMPACT:
Account #: N!A Amount of this ibm: N/A
Current Budgeted Arr�ount Availabie: Amount Ramaininp afbsr itern:
N/A NIA
Budget Tra�sfer Required: No Appropriate Fur� Balancs: No
4. EXECUTIVE SUMMARY C3F MAJOR IS8UE3: (This is a snap shot description of tire agends item)
The Pubtic Safety Emp4oyees Pension Board is seeking Council approval to incre�e the permissible
intemational investmer�t allocation from 15% to 25°,b. The requested change will bring the Public Safety
Employees Pian's peRnitted intemational aliocation in line with the Village's General Employees Plan and
Florida state law. The purpose of the change is to give the plan truste�es and their advisors the flexitrility to
optimize retums while controtling risk and dampening volatility.
5. APPROVALS:
Dept Head: ``�' �` Finance Director: ❑ Reviewed for Financial
Sufficiency
� No Financiai Impact-,tia,; t( , �ac �
Attomey: (for legal s ienc ) !'b b ��VLSi Din r � - �� F " "� ��� k �
� �c � �tl�1_� � Yes ❑ No ❑
r Wrt�l Pr'M b r
Villa9e ManaAer: � �-
� SUBM{T fOR COUNCIL DISGUSSION: �
• APPROVE ITEM: ❑ Redistributed from 12/9/10 Council
Meeting with the addition of the IAFF and
• DENY ITEM: ❑ PBA Waivers
FoRn amended 08/26/08
AGREEMENT
The Palm Beach County Police Benevolent Association, Inc. hereby waives
bargaining overthe attached amendment to the Village of Tequesta Public Safety Officers'
Pension Trust Fund Section 5 Finance and Fund Management increasing the foreign
investment allocation to 25% which wili be presented to the Viilage of Tequesta {"Village")
as Ordinance No `°"��' . This is in no way to be c�nstrued as a blanket waiver
of any kind; the Union specifica4ly reserves the right to negotiate over any other pension
changes in accordance rivith the law and the collective ba�gaining agreement between the
Palm Beach County Police Benevolent Association, Inc. and the Village.
VILLAGE OF TEQUESTA PALM BEACH COUNTY POLICE
BENEVOLENT ASSOCIATION, INC.
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Print Name and Titl Print Name �rfd T le
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W itness W itness
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Date Date
BSJ/adt
December 2, 2010
H:\Tequesta PS 1011\Union�2010 Inc Foreign 25% - PBA.wpd
AGREEMENT
The Palm Beach County Police Benevolent Association, Inc. hereby waives
bargaining over the attached amendment to the Village of Tequesta Public Safety Officers'
Pension Trust Fund Section 5 Finance and Fund Management increasing the foreign
investment allocation to 25% which will be presented to the Village of Tequesta ( "Village ")
as Ordinance No . This is in no way to be construed as a blanket waiver
of any kind; the Union specifically reserves the right to negotiate over any other pension
changes in accordance with the law and the collective bargaining agreement between the
Palm Beach County Police Benevolent Association, Inc. and the Village.
i
VILLAGE OF TEQUESTA PALM BEACH COUNTY POLICE
BENEVOLENT ASSOCIATION, INC.
Jul � �t-Z- �•✓,T� -✓ ��J• � � � ,
Print Name and Title Print Name , nd T' le
t a
Witness W itness
Date
Date
I
BSJ /adt
December 2, 2010
H1Tequesta PS 1011 \Union \2010 Inc Foreign 25% - PBA.wpd
12/14/2a10 15:54 15619691659
IAFFL�CAL2928 rHU� �l �y
A�GREEM�NT
The Internationa( Association of Firefighters, Local 2928 hereby w�ives bargaining
over #he a#tached amendm�nt to the Villag� of Tequesfia Public Safety OfFicers' Pensian
Trust Fund Section 5 Finance and Fund Managem�nt increasing the for�fgn investment
allocativn to 25°!o whi�h will be presented to the Village af Tequesta ("Uillage") as
Ordinanc� No i�'�� . This is in no wa� to be cat�strued as a blanket waiver
Af any kind; fihe Univn specifically reserves the righk to ne�atiate over any other pension
chenges in accardanc� with the law and the callective bargaining agreement be�nreen #he
(nternational Assaciatian nf Fire�ighters, �.ocal 2928 and tihe Village.
ViLL,AGE dF T�QUESTA INTERNATIONAL ASSOClATION OF
FIF�EFIG�iTERS, LOCAL 2928
: �,�,.��- t �'' (�► �� �,,...� � . • � c- e..S � c�, e,,,�,
Print ame 7i �e LQ�C�tR.K1R- F'rint Name and 7it1e
."�� �� k ;.� — '�
W itness ��� W i Ss
`%°�/� � !'` �./� - ��'�f�
Date ! D�te 4
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BSJladt
Oeoem6�r 2, 2090
H:1Tequosta PS 16191Un14n\2010 fnC Forelgn 2S%.wpd
Lori Williams, Village Clerk Novembe� 29, 2010
Village of Tequesta
Dear Lori,
The Public Safety Empfoyees Pension Board is seeking Council approval to increase the permissible
internationa{ investment allocation from 15% to 25%. The requested change will bring the Public Safety
Employees Plan's permitted intemational allocation in line with the �Itage's General Employees Plan
and Florida state law. The purpose of the change is to give the pian trustees and their advisors the
flexibility to optimize retums while contmiling risk and dampening volatility.
I.ast Wednesday I provided you with three distribution items for the Council. The first, the periodic •
investment table was originatly concelved and published by Wllshire & Associates. It captures the
variability of asset class retums year to year and illustrates the importance of dlversification. The
second is a summary of countries that fall inside and outside of EAFE. EAFE is the internationai index
consisting of mature Asian and European economies. Ou� cument intemational manage�, American
Funds, manages an EAFE portfoilo. As such we currer�tly do not have any exposure to the economies of
many of the countries that are expected to lead the world in eccnomk growth over the next 30 years.
The third item is an analysis of the opportunity in the emerging maricets.
t want to stress the Board has not made a dectslon to increase its international ailocation at this time.
But we believe having the flexibility to do so if warra�ed is in the best interest of the plan participants
and the Viilage.
Regards,
Frank D'Ambra, lll
Chairman, Village of Tequesta Pubiic Safety Employees Pension Board
Periodic Table of Investment Returns
2009 2008 2007 2006 2005 2004 2003 2002 ' 2001 2000
sc u.s.
Barctays Capit� U.S. MSG EM MSCI EM FT5E Nare�t MSCI EM FTSE�Nareit MSCI EM flOW U � FTSE Nareit �� U8S
Aggregate 79.02 Aggre9ate ;a ?& 35.Oc � �4 Sn i 31.56 5628 C �25.9 �� 17.93 C �31 84
5.24
8C U.S Dow UBS Dow U85 �C �� 5 8C U.S- I
Berolays Capitai U.S. RMidcap MSCI E6� � MSCI EM R200G ; F Nareif
Treasury�. U.S. lIPS 40.48 TtPS Gommodity , , �� � Commodity Z� 9� 4� 25 TIPS � Aggregate �� 26.36
-2.35 1623 2'1.36 � 16.56 9.42
- T
Merrill Lynch Emg � f ,,. � � BC UB.
Mkt Sovereiqn and ML Emg Mkf NCREIF h;CRc�r I MSCI EAFE 1_�REi!= i MSCf EAFE RMidcap ML Emg Mkt T �� S ML Emg Mkt
3928 -6.46 15.84 26.86 � JE. � 2�.7 40A6 , 1Q49 � B9 13.8
Corp (
BC U.S, � BC U.S. 6C U.S.
Dow U8S MSCI EAFE '.^t. Em Mkt R200C; i MSG EAFE RM1ticaC ; MSCI @APE� NCREIF
Commod� index 32,4g -�8.55 TIPS 183�F � 14.42 ( 20.22 ' 39.17 � 99 � fe 7.25 TIPS
. !tY i � �.�r,3 � � - �0.27 13.15
HFRI FOF �
FTSE Nareit Equity R1dW �iversifieti I MSC! EAFE NCREIF RMfdcap R2000 fTSE Nared NCREIF ML Emg Mkt NCREIF
Reits 28.43 index ii.63 18.59 12.65 58.33 37A8 6.74 3.37 12.24
-20.84 �
.�I HF Rl rOF � 4iFR1 FOF�. 8C U.S.
HFRI FOF: fTSE Nareit R2000 Diversifietl R1000 M�.- Emg Mkt NCREIr ML Emg Mkt FTSE NBreit Divsrsihed Aggregate
Diversified lndez 27.99 -33J9 Indax t5.46 12b3 54.48 33 7 3.81 Vndex �� �
973 279
� Dow U8S BC U.S. HFRI FOP
.�+2000 RMidcap FTSE Nareit ML Emg Mkt R7000 DiversRied R2000 RMidcap
MSCV EAFE Commodity nggregate
. � ``.��:.` 3S.fi5 �� S.g6 15.26 12.t3 i 12.82 29,89 Index 2.49 8.25
1.15
MSCI EM Dow U85 HFRI FOF: Dow UBS HFRI FOF:
R100Q R1000 ML Em Mkt Drversifiea R1W0 � ti1SCl EM MSCI EM DiversBied
jEMERGING Commodity 9 � Commodity ;
MARKETS) 98.91 -37.6 5.77 72.52 Index 11.4 .23.93 5 -2.37 lndex
,'.47 2.47
NCREIF Nationai HFR� rQc� HFRI FOF�. Dow U85 1 HFR1 FOF I
� Diversitied FiSE Nare+t RMidcap Diversified R1pQ0 Diversifred MSCI EAFE � RMidcep R2000
Property Index - Full • I Commodity
Intlsx 37.73 5,fi Index 6.27 9 15 Index -15.68 -5.62 -3.02
Hlstory 11.45 10.18 11.43 �
BC U.S. BC U.S. BC U.S.
RMidcep ML Emg Mkt R2000 NCREIF RMiticap ' R1000 R1000
Russell1000 TiPS _q1.46 5.55 Aggrega�e 4.55 SiPS �.� -76.19 -12A5 -7.79
11.41 � i 4.33 8.46
HFRI FOF:
BC U.S. ` I � 4ow U85 BC U.S. BC LLS. Dow UBS
�MSC4 EAFE ; R20W Diversitied R2000 tJSCI EAFE
Russell 2000 Aggregate -. �� _� 57 `Commodity TIPS ��� TiPS 20 � , Cammodity � �,� 8 �
5.93 � 2.07 2,64 7.18 8.39 -19.57
NCREIF MSG EM FTSE Narert' BC U.5 8C U.S. BC U.S. BC U.5 R1000 'MSG!'EAFE MSCI EM
Russell Mklcap TIPS Aggregate Aggregate Aggregate
-16.86 -53.18 -15.69 0.41 2.43 � A.34 4.11 -21.65 : 30.61
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f � � �7u.�vever, i�i oi��� vipw�, rather tha�� be inti�;;id�ted by that rebounc�,
f��; ` is worth rr�n7��mhering that the 2009 ralfy co���menceci fr�m
� �i�_�ation levels si�7�ilar to cri�is iow�s sePn oi71y a hanciful of
George Iwanicki, �r. '`?S �1U1"II1g Ch� E�c�SC TWO Cl�'CdC1�5 and mereiy I"E�SCnI"E'l� CTI(�St
Mdnaging Director „
Heatl of the Structured Strategies Group � ' ' ' ' � ` ' � t �
Global Emerging Markets Equity
As such, we expect another year of positive returns for EM equities, albeit more in line
with long-term total returns in the low 'teens, than anything of the order of last year's
rally. From here, we expect earnings growth to be the primary driver of returns during
2010 and beyond, reflecting not only healthy ecanomic growth but also improved
corporate capital discipline (allowing profits to partitipate in economic growth).
Despite the fact that the financial crisis of 2008 was centered in the developed world
(primarily the U.S.), by the end of that year valuations in emerging markets were
forced down to levels usually associated with EM-centered crises. History has shown
us that from the lows of those previous crisis valuation episodes, EM outperformed
��foba� ��erspeetive � gtobal equity markets in most instances, not only over one year but also over three
-_ �+�; �� ,;-: ; �� �� .- ���i, � and five years; hence, history is on the side of continued EM outperformance.
. ,
�,u� c t�� �. �� �� � �,t<<�:,�� �
f ,-, ,„;� ; i, ;;.�, _,; Broadly speaking, valuations have reverted to the neighborhood of "fair value" levels
,__ �.�,,,�r,��arr.:.:���e��iv . � in emerging markets. As Exhibit 1 shows, forward eamings multiples are at the
`:'! ;r�`k°rs �`,``"' " � upper section of the range that has prevailed over the past decade. However, we're
�/l'�[h d 411.�" t� 1�p r."`� i �. �.�' . �
.[rat�gir�,, ovP� �, �I, � �i �:�, EXHIBIT 1: GEM PRICE TO FORWARD EARNINGS: 1990—DEC 2009
i;?t1 � p�? ;Pflf.�� '� ?3 Ct)Unitis' _,, � 25 � MSCI EM Fwd PE
„��= � ii�i;i� :�dv� dtCP55 C�� "r:`� ': ._ -� � --- RoIHnBAVerage
-. ., ��reldih i�r LP. N10I';1I1�5i,16L., +/-tsd
J� ieS. 20
I_,�.,� �i m�xr� osi hoK� �•n�� ;.omt�in;=
D.�I p?!',pc�CU;f• �+ith I'c�l .
15
_ �
10 _
I .
5 -I , —�--- _,__ __-__ � -, --�---
Jan-90 lan-93 lan-96 lan-99 !an•02 Jan-05 lan-OB
Source: Bloomberg. Data as of end December 31, 2009.
J.P. Mor�an
� ����� � � ��� € .,t � �`� ,, � ��s� ." � � �� � rt �,� € ".,�� q. � '� ��`s % r,� .a�
��� ,.
� a.� �°��, '` ��� �`'� �� ,� ���� � �� r���������`�`° � �k� ` �
� � �,��.u� � �w '��4 �
� � �' �- f ��`* � � �s..�� � a � s � � }�� a x
.... �, a. � .�.� ,s ���.a*"r ..�� �,e.�, ;,� ,. . . . ��� = , .,., r�;�. ��x��.� ��� �, ���:- ���� _�
EXHIBIT 2: GEM PRICE TO BOOK: 1993—DEC 2009 Exhibit 3 shows that they have come back over the last 6-7
1.6°° MSCI EM — MSCI EM P/B (RHS) �,! 4 '� months. And just as investor flows have begun to return to the
�.aoo � s.s asset dass, analyst gloom has begun to normalize as well.
'' r 3 � 0 With valuations around norrnal, we would suggest that
,.000 � 2 � 5 earnings growth could come from one of three sources:
$� _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ , z.o either from the bounce-back in the cyde, in other words
boo �,.s the laggards where earnings levels haven't rebounded to
aoo ;,. normal levels. Or strong earnings growers on a trend basis, in
zoo r o 5 other words those places where both economic growth and
7 ; corporate capital discipline aliow for Strong earnings growth.
o �-- --T_ _, — o.o
lan•93 Jan-96 lan-99 ,�,-oz lan-OS ,��-os Or the final area is those places that have reasonably good
Source: Bloomberg. Data as of December 31 zoo9. local earnings growth, but also could see some currency
still well below the long-term average, which includes the high revaluation benefits that would make those earnings look
valuation 1990s period. It is a similar story when we look at much stronger in U.S. dollar terms.
the Price/Book value (Exhibit 2) which is now just above 2x, With this in mind, looking at some of the numbers that we use
slightly above its long-term average but for good reason — as our best estimates of earnings growth, it is interesting that
profitability has improved over the past decade. some of the names that stand out are not the usual suspects.
The improvement in corporate capital discipline during the For instance, Poland and Hungary are good examples of
2002-2009 period is striking; after languishing near the Eastern European markets where earnings are not necessarily
bottom of global rankings during the 1990s, Return On Equity going to grow rapidly on a long-term trend basis, but over the
(ROE) has matched or exceeded that of global leaders (II.S., next 3-5 years there is a cyclical recovery that's still to come.
Europe) over the past several years. Analysis of corporate Also Taiwan and Korea, both technology-heavy markets, are
financial statements shows this is a reflection of improved countries where earnings growth was so suppressed they
operating leverage (i.e., rising asset turnover) amid flat-to- actually appear to still have good cyclical recovery ahead.
declining financial leverage (i.e., contained net debt/equity), Turkey and Brazil screen well as strong trend growers while
and hence provides reason to believe the impravement in the revaluation effect5 in China could be very beneficial over
profitability may be sustainable over coming years. coming years in terms of making for strong U.S. dollar or euro
The medium-term earnings outlook far EM is positive in our earnings growth. In a sense, with valuation compression having
begun to unfold and overall valuations having moved toward
view: economies recovering from recessions or slowdowns neutral, it's time to start looking for rotation toward what one
provide a positive tailwind for earnings growth generally. After might characterize as longer-term secular favorites that have
earnings expectations jumped off a cliff eighteen months ago, earnings growth.
EXHIBIT 3: LONG-TERM EARNINGS PER SHARE (EPS) ESTIMATES
30 ,
25 1
20 �
15 1 I
10 � 5 —. _----_____ _.-- - - _.. ..
la�-95 Jan•97 la�-99 lan-01 Jan-03 lan-OS lan-07 1an-09
Source: Institutional Brokers' Estimate System (IBES), 1.P. Morgan estimates. Data as of Decemher 31. 2009.
� �
... . . k u�' :26 :
. . . . . . . . �, � �..
EXHIBIT 4: NOMINAL GROWTH: DEVELOPED ECONOMIES
25 -
U.S. — Eurozone — Japan ---�--��-- U.K.
20 � ,
ro
15 i ,
>
�° 30 . - ... .. `..r. .,
.. _ �
���� .
5 �-�,. .r� .. ".-._"_...!.._.�.._...-�
. �•_. �... __ . ._.� .�_.-._�--•.___._.,._. , .
0
5 -)
10 � i �—r i i - t -. ___r�.__.r'—"-t� -- T — � -- r — r— �—��-�— ..r _--�--r__.__�_...r. _.._�_� ..
80 85 90 95 00 OS 10
Source: CLSA, "Strong China lending and export numbers," October la, 2009.
G lobal backd rop remai ns su pportive to emerging markets that we think has been one of the key drivers
of market performance over the past year.
After experiencing the so-called Great Recession, we remain in
recovery mode, in the developed worid particularly. Nominal GDP While the economic Cycle remains in the very early stages, a look at
in most of the developed world was forced into negative growth the global market cycle suggests that this is more advanced than
territory (Exhibit 4) — a scary situation for central banks. Even many realize (Exhibit 5). Indeed, as the chart shows, the global
with the kind of recoveries that are being projected by 1.P. Morgan, market cycle has unambiguously moved into mid-cycle, ahead of
the IMF or other forecasters, when you look at where economic the business cycle. Global cycle signais are already indicating a shift
growth is going over the next two years, the output gap in the from recovery to expansion. While we don't mean this bearishiy, it
global economy is likely to remain very disinflationary over the is worth highlighting given the important implications for how one
next two years with nominal growth already very siow. positions within the asset class, particularly from a sectoral per-
The effect of this was, first, that central banks slashed rates. This spective. The important point here is even though we're in very
was not unique to the developed world; it also happened in the early stages of the global economic recovery, the market cycle for
emerging world. Second, central banks in some of the developed EM equities looks like it's encouraging the rotation in terms of sec-
worid countries — the United States most notably, but also in the UK tor leadership away from consumer. IT and particularly materials.
and, to some degree, the EU — resorted to extraordinary measures. While rotating toward areas like financials, industrials and energy.
This is creating not only a slow growth environment in the As mentioned previously, we're not negative on the asset class
developed world, but, more important, it's creating a liquidity Plow because we're further along the market cycle. When you look at our
EXHIBIT 5: GLOBAL CYCLE INDICATORS: CHANGE IN GLOBAL EARNINGS REVISIONS AND POLICY RATES
a
, --- ACWI 6M Rev Early Cyde Mid Cyde Late Cyde Early Cycle
3 I, Consumer Industrials Telecom Consumer
� GlobalRate Change
` � IT Energy S[aple5 IT
z Materials Financials Utilltles Materials
` 1
c
��
m 0 . �..�. .:-- � :
� - --r-- .. _ ._y.._ _
d
� _1 .� . � ...
v �
� �� �
i
d •3 �
0
'� -4
N
-5 �
Jan-96 lan•97 Jan-98 Jan•99 Jan-00 Jan-01 Jan-02 Jan•03 lan-04 !an•OS lan•06 Jan-07 Jan•OS lan-09
Source: J.P. Morgan estimates. Data as of December 31, 2009.
� :
.s"`. ^-- a« h� '�`�F � �- � '�e� `g^- ` ,�.ax ' -� � _ -
� W'��'.��t'�'� ,v ��� � � f ,� � . � � * �, �`°- � �*,.�'rs�a '"� � 7 �" �� �s � �; * .
� �. � � .'�r � �,.� ��.s � �2 �3 t- a�- t .�.
I ' �— ��*ai � �s�t�.� �,`�o ��rrr,.�;. �„ �� �� ���t��,��' � �c4 z `#��
� �� .. - - . .. . . . .. . . _ _ s�, .. __ .r_ . _ .. .._� .���
EXHIBIT 6: PROSPECTIVE GEM USD RETURNS BY SOURCE
ao ,, ,
,, �
zo � � � e.iw6
�
� -zo �__ _T -�-- � '_--���.__�.---. , ��._�
c 0 � � �
a
a '
_ J ■ Valua[ion
I • FX
-60 � EPS
! � Dividends
-80 J
1987-94 1994-97 1997-02 2002-OS 2009-20I4E
Source: J.P. Morgan estimates. Data as of January 7, 2010.
Illustrates the contribution to total index retum of earnings growth (EPS), dividends and changes in local currencies and valuation multiples (forward Iooking price%arnings ratio).
best estimates of expected returns for the asset ciass, our trend performance for EMEA and Latin America, as several commodity-
measure is stili showing around 99% or higher over the coming oriented currencies appear expensive. This differentiation from
3-5 years (Exhibit 6). The bulk of those returns, as mentioned currency tends to overwhelm modest differences in potential
previously, we think will come from earnings growth. returns from dividend yield (which favors Latin America) and
valuations change (which favors EMEA).
Investment ideas — tactical and strategic As alluded to above, whenever you think about emerging markets
you have to think about the question of currency. The notable point
With this backdrop in mind, tactically (i.e.. 3-6 month horizon) from here is that, as a rule, commodity-oriented export currencies (e.g.,
a top-down perspective, we favor Turkey, RuSSia, Korea, South RUe. BRL) have generally been trading to the strong side of fair
Africa and Brazil, generally due to attractive relative valuations. value, while manufacturing-orientated currencies look cheap (e.g.,
In Brazil's case, due to a combination of reasonably attractive RMB, TWD, KRW). This spraad between valuations has persisted for
valuations and positive momentum. We are most enthusiastic abou2 some time and the question that remains is when does that begin to
Turkey, given that much of a potential secular re-rating should still roll off? One of the points we would make is as markets and/or the
be ahead. Using the same value and momentum indicators, our economy rolls from early cyde into mid cyde, the inventory kick
least preferred market is Malaysia, with India and Taiwan also thaYs been driving commodity prices upwards, as well as the poten-
appearing richly valued (aithough in the case of Taiwan on the basis tial that the U.S. dollar finds stability or even bounces as some of
of recession-level earnings). In the case of India, the combination the market commentators are beginning to look for, those tailwinds
of rich valuations, relatively high investor enthusiasm and likely to commodity prices and to commodity currencies may be diminish-
tightening from the Reserve Bank of India reinforces our caution. ing. As such, we are cognizant of some of the risks in the more
Strategically (i.e., 3-5 year horizon), we favor Emerging Asia expensive commodity-oriented currencies as a potential factor in
over Emerging Europe, Middle East and Africa (EMEA) and Latin motivating slower returns from those countries going forward.
America. Our approach to strategic valuation focuses on four Within that strategic framework, our preferred markets longer
sources of potential returns: earnings growth, dividend yield, term include Thailand (valuation), China and Korea (currency
valuation change and currency return. Using our best estimates returns) within Asia; Hungary and Poland (eventual earnings
for each, the differentiation among regional returns is most recovery from recession) and Turkey (valuation) within EMEA; and
apparent in currency. Secular currency revaluation should motivate Brazil (strong earnings growth albeit with some currency over-
outperformance for Asia, whereas reversion is likely to drag on valuation) favored over Mexico within Latin America.
_,.
— - __.
EXHIBIT 7: CUMULATIVE FLOWS INTO ALL EMERGING MARKET FUNDS (USD MM)
zoa,000 -
All EM — All EM ETf
�5����� j
1 �
10�,000 ,
50.000
0 . . . . r __ _—__.—_. , . .._--..
---�--- - r
Feb-96 Feb-98 Feb-00 Feb-02 Feb-04 Feb-06 Feb-OS
Source: Emerging Portfolio Fund Research, Inc. (EPFR). Morgan Stanley Research. Monthty data as of November 30. 2009.
MonthlV daCa is laggetl but provides the most comprehensive data set.
Potential sources of volatility performance of the following chart shows that when the U.S.
dollar is weakening, emerging markets tend to do very well and
While the outiook appears positive for the as5et class, volatility When the U.S. dollar is strengthening, emerging markets tend to
remains inherent to emerging markets investing. Relative to last reverse (Exhibit 8).
year, in an environment of more normalized returns, this becomes
increasingly more relevdnt for investors. Sentiment has admittedly Part of this is risk aversion, as we've seen over the past year and
turned quite favorable toward EM equity during the past several a half. But part of it also reflects, in our view, that despite the fact
months; inflows continue, and mos[ survey data suggest investors that we've shifted from a predominantiy fixed rate regime to a
are either equal or overweight within (still contained) equity floating rate regime, because several emerging economies stilf
allocations (Exhibit 7). Accordingly, the risk of a pullback manage the flotation of their currency (i.e., dirty floaters), there is
sometime during 2010 is materiai. an importat+on of developed world monetary policy into emerging
markets which means this negative correlation still persists and
As such, it is worth considering some of the outlier events or looks as tight as it ever has.
potential sources of volatility that might upset the apple cart as
2010 progresses. The first is the U.S. dollar. Despite the fact that Related to this currency point is another potential source of vala-
emerging markets have largely moved from a pegged exchange tility. Despite believi�g we're in a disinflationary worid, there are
rate regime to a floating exchange rate regime across most econ- some local inflation risks within emerging markets. Inflation is
omies, the negative correlation between the U.S. dollar and likely to stay within the ranges that we've seen over the past sev-
emerging market equities is still significant. The apparent "scissor" eral years, however, what's noticeable is if you look across Asia,
EXHIBIT 8: EMERGING MARKETS NEGATIVE CORRELATION WITH USD REMAINS INTACT
115 r 2,300
USD REER (LHS) ---- EMF (RNS) •- 2,100
110 -� 1,900 0
0
105 � �� 1.700 ;'
a r 1,500 P
100 _ ! ?;
� `v� � � 1,300 �
0 95 � 'r 1,100 x
�' � 900 °i
d 90 �
� i 700 '
85 500
80 � 300
75 � . . -- � 100
Jan•90 Jan-93 Jan-96 lan-99 3an-02 1an-05 Jan-08
Source: 1.P. Morgan, MSCI. Faciset. Data as of Novemher 30, 2009.
, � �, � :.
t-��.� 1-��s'�� -� �'�'�'� �. . -�� � �_,,�'�� � �azG: "�`"����-.�� *��^�'�,,��.��i�5�� � ������.�
� � �� t � � i � �
`c a . .�'�. �� � , ... ,�. �>r _.�Yx� � �`� fi a��.�" rs�',g� t�'�` �� �:._` a � , s °s�. � � , t ��_��.. �
EXHIBIT 9: HEADLINE INFLATION: CPI INFLATION V5. TARGET BAND
16
14 _ ■ Target band/five year range CPI 2010e ♦ Nrrent inflation target
12
LO
8 7
6 �
4 7
2 7
p _ — — __ , ---- , ` ,_ _ _ ,
BR ME CN IN ID TH RU ZA TR
Source: 1.P. Morgan, Internationai Monetary Fund (�MF). Data as oi January 31. 2010.
there are a few countries where inflation is either touching the returns between here and overshoot territory could be very
top end of the band or could threaten to break out of the band strong. "Bubble" is a scary word, but the road between here and
(Exhibit 9). India is a good example. In summary, the inflation those excess valuations could mean another possible surge in
risks within the asset class look as though they're concentrated in performance.
some of the currency suppressing countries in Asia where we
could see tightening unfold over the coming year, given those
inffation pressuresthreateningto push inflation outsidethe band. �OnC�U51�i1
The last point, and a more optimistic one, addresses the concern: In conclusion, in our view the global backdrop sCill remains
Has a bubble alreadV begun unfolding in valuation terms? And supportive, not so much because growth is rebounding sharply
simply, our answer is no. The environment that we're looking at in the developed worid, but because growth is rebounding
now looks to us simiVar to the environment that we saw in the moderatefy and policy rates are likely to remain low for some
early 1990s when you had a financial and hausing sector oriented time. The important paint, though, is the global market cycie in
recession in the U.S. and the U.K. and the developed world ended emerging markets has moved into mid-cycle, even if the global
up taking policy rates down to very low levels and keeping them economic cycle hasn't. As a result, it has implications for returns
there for a long time amid a slow recovery. In that environment, and how to position in the asset Class. We continue to think from
you did get what one might think of as the original emerging mar- here it will be earnings growth that will be the primary
ket bubble, and if you think about the dynamics that unfolded differentiator of performance. However, from a strategic
then and where we are today, it looks to us like you still have the perspective, there are some potential sources of volatility that
possibility that outside of our baseline case, You could get a surge either coufd pfay upside or downside for the asset �lass around
in emerging markets beyond the surge we've aiready seen. If you our base case. However, it is worth remembering that during the
look back to the eas4y nineties environment, in that period as multi-year raUy from Z003-z008. EM equity experienced a
emerging markets economies and earnings recovered, you saw correction at least once each year, typically seeing declines of
the market first trade up to about a 15x forward multiple, but 10-2096 and lasting 4-6 weeks in each before resuming the bull
then as policy rates were kept low in the developed world, we market. Arguably the bigger surprise would be the absence of any
ended up getting a surge during 1993 where valuations actually correction given the history of EM; the timing and catalyst for
went over 20x forward earnings. Again, that's not our base case, such a bul!-market correction are, of course, difficult to call. And
but if you consider where we are today, at a touch above 13x for- returning to the strategic outlook, we believe the positive case
ward earnings, we are not yet at bubbfe valuations, and that for emerging markets continues; stru�t�ra{ growth driven by
liquidity ffow stiil could create an overshoot situation whereby urbanization, lower sovereign and corporate debt and improved
shareholder returns.
6
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�-� � � f�_ r �.r �� n �= ' ��_!i i�;i _� � �,--.
China, India, Brazil <�n�J P,uSSia. The Emergin� Market5 Equity Fund irn�ests in 5t���k5 f�or7� tr�ese and other
couritries where r apid urbar�ization and indu5trializatio�i can ct�ntrib tn stror�� return potenti��.
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Insig�� Pro�ess �k Results
�:�������+ or�� Expe�ienced team focused a Strong, consistent long-
on quality stacks term performance
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;,,� � ; . ,� ; ,, - Ra[eri *ir,t,t by ti9orningstar
�ncc ,� e���E r��= r:a. - Top quar[ile performer versus
� _ � r,at � et ho�'.• ��t ����i e peers over the pas[ three years-
.�� garhF r� ,ns�s,nr s :�
;�e „rou�cl �.i local n��. �-� � - Emphasizes quality companies,
long-term investment focus and
E:otto❑�-:.,p _t;ick srleciicr ;.� stron� risk-adjusted returns
,: i: n�anage� h135i�i�5; �n�: - May be suitable tor long-term
inaMv o�tt� Uu�e�iu�,l investors looking �o participate
�� ek ro n�o� r �i i rFr � ��, in global economic growth, as
�_.ure� tu �_ ��� ��:� well as increase return pot�ntiai
cn,;nt� �r�; r,r� i and intemational diversitiration
.._ ., FDf A,hdi?5 dC IVAV ;75 �f t�;�-U-1�'!
Morningstar overall rating 4 scars, Class A as of 6/30/10: Diversified Emerging Markets Category; 269 funds. Three year rating 4 stars: 269 funds.
Five year rating 4 stars; 205 funds. Ten year period not yeT rated.
535.000
Pund performance SZe.000
A$10,000 investment in 1PMOrgan Emerging Markets Equity Fund (A Shares) 8zi.000
at NAV, with dividends and capital gain5 reinvested, would have grown to Sia.00u
$24,523 from inteption on 11/15l93 through 6/30/10. The chart is piptted S�.000
mon[hly. There is no direct correlation between a hypothetical investment $�
dlld tllE dlltlQpdt2d peffOffT10f1Ce OP tI1Q FUfld. 11/9394 95 96 97 98 99 UO Ol 02 03 04 OS 06 07 08 09 6/10
Total returns Average annual total returns (as of 6/30/2010)
Performance at NAV (%) Latest QTR YTD i yr 3 yrs 5 yrs 30 yrs
A Shares' -9J9 •6.09 I 2t.02 -2.56 12.14 9.52
Lipper Emerging Markets Funds Intlex -8.75 -5.93 ' 23.81 -4J4 10.95 9.40
MStI Emerging Ma�kets Index -8.24 -S.OA , 23.48 -Z.22 13.07 L034
W[th sales charges (%)
A Shares with maximum 515% sales charge -ta.51 -11.04 j 14.69 -a19 10.94 8.92
The per ormance quoted is ast per/ormartce and is not a guarantee of future resu(ts. Mutual funds are subJect to certain market rlsks. fnvestment returns and principal
value a�an investment wiil �luctuate so that an investor's shares, when redeemed, may be worth more or fess than their ori cost. [urrent per/ormance may be
higher or lower than the per/ormance data shown. For performance current to the most recenf month-end, please ta111-800-480-4111.
� The quo[ed performance of the Fund indudes performance oi a predecessor fund/share class pnor to [he Fund's commencement of operations.
The Lipper Emerging Markets Funds Index reP�esen(s the rota! reNms of che funds in the indicated category, as defined by �ippec. tnc. An individua! cannot invest direc[!y in an ;ndex.
The MSQ Emerging Markers Index is a free float-adjusCed market Capitaliza[ion weighted index [ha[ is designed to nieasure rhe epuity market performance ot emerging markets. The performance
of the index does not reffect the deduction of expenses associated with a mutual (und, such as inves[ment management fees. BY contrast, the performance of the Fund reHects the deduction of the
mutual fund expenses, induding sales charges if applicable. 7otal rerom figures assume the reinvestmem ot dividends. An individual cannot invest directly in an index.
totalannual
Expense cap Expes+se Fund operating
Annual opereting expenses expiration date cap (%) expenses (%N
A Shares 02/28/2011 ?.00 1.86
'The Investmenl Advi,or, a4ministrator and Distributor have contractually agreed to waive fees and/or reimburse ezpenses to the eztent that Total Annual Operating Expenses (exduding ncquired
Fund Fees and Expenses, dividend ezpenses relating to short sales, inrerest, caxes and extraordinary expenses and expenses reiated lo the Board of Trus[ees' deferred compensauon plan) exceed the
expense cap of [he average daily net asse[s through ihe expense cap expiretion da[e. Without the Acquired Fund Pees and fxpenses, the Total Annual Operating Expenses and Net Expenses would
have been lowec In addition, [he Wnd'S service providers maY voluntarily waive or reimburse certain ot their tees, as [hey may determine, from [ime to time.
/
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JPMorgan Emerging Markets Equity Fund I
Oblective
The Fund seeks to provide high total retum from a portfolro �
of equi[Y searities from emerging marke[ issuers.
Investment style/market cap �OCdI In51$ht GlObdl Hlgh-COnViCtiOn
vaiue core Growth Resear<n analysts _ p2�SpeCtivE p ortf0{i0 Of be5t
in Asia. Europe, the Portfolio management ideas
Middle Eas[, africa and ream
� Large l.atin America
, a . Mid
� .
���' - Identify quatity - Use experience, - Concentra[e on mosi
Small Companie5 with potential judgment and research promi5ing opportunities
to beneii[ From giobal insights [o select stocks globafly and hold them
Portfolio managers/industry experience" economic growth and manage risk for the long term
Austin Forey, 22 years
Ashraf EI Ansary. 11 Years
Gregory A. Mattiko. 18 years
Rithard Titherington, 26 yearz
tontact 1PMorgan Disfribution Services, lnc. at 1-800-480-4111 for a fund prospectus. Vou can also visit us ai www.jpmorganfunds.
com. Investvrs should carefully consrder the investment objectives and risks as well as charges and expenses of ihe mutual fund be%re
investing. The prospectus contains this and other information about the mutual fund Read [he prospectus carefully be%re investinq.
Opinions, estimates, forecasts, and statements of financial market trends that are based on turrent market conditions constitute our judgment and are subject [o change without
notice. We believe the information provided here is reliable. These views and stracegies described may not be suitable for all investors. References to specific se�urities, asset
dasses and financial marke[s are for illustrative purposes only and are not intended to be, and should not be interpreted as, remmmendations. Past performance is no guarantee
of future results. Please note that investments in foreig� markets are subject to special currency, political, and economic risks.
R�SKS ASSOCIATED WITH INVESTING IN TNE FllND:
International investing involves a greater degree of risk and increased vo{ati4ity. Changes in currencY exchange rates and differences in accounting and
taxation policies outside the U.S. can raise or lower returns. Also, some overseas markets may not be as politically and economically stable as th2 United
States and other nations. investments in emerging markets could lead to more volatility. As mentioned above, the normai risks of investing in foreign countries
are heightened when investing in emerging markets.ln addition, the small size of securit+es markets and the low tradi�g volume may lead to a lack of liquidity,
which leads to increased volatility. Also, emerging markeis may not provide adequate legal protection for private or foreign investment or private property.
Diversification does not guarantee investment returns and does not e�iminate the risk of loss.
Total return assumes reinvestmen[ of dividends and capital gains distributions and retlects the deduction of any sales charges, where appticable. Performance may reflect the
waiver of a portion of [he Fund's advisory or administrative fees for certain periods since the incep[ion da[e. If fees had not been waived. performance would have been less
favorable.
�There can be no assurance that the professionals currently employed by 1PMAM will continue to be employed by 1PMAM or that the past performance or success ot any such
professional serves as an indicator of suth proPessional's future perfo+ or success.
The ranking information is provided by Lipper Analytical Services. The 1PMorgan Emerging Markets Equity Fund — A shares a[ NAV was ranking against the following number of
funds in the Lipper Emerging Markets Funds Categary for the period ended 6/31/2010. For the 1 year period 235 ou[ ot 386 funds. For ihe 3 year period 59 out of 259 fu�ds. For
the 5 Year penod 40 out of 190 funds. Ten year period not yet rated. Past performance is no guarantee of future results. Rankings are calcUlated based upon the total returns of
multiple share classes within their respective lipper category. Differen[ share dasses maY have different rankings.
Morningstar calculates a Momingsta� Rating metric each month by subtraccing the retum on a 90-day U.S. Treasury Bill from the fund's load-adjusted retum for the same period,
and then adjusting this excess return for risk. The top l0�'0 of funds in each broad asset dass receive 5 stars, the neM 22.59b receive 4 s[ars, the next 354b receive 3 stars, the next
22.S�io receive 2 stars and the bottom 10% receive 1 star. The Overall Morningstar Rating for a tu�d is derived trom a weighted average of the performance tigures associated with
its three-, five- and ten-year (if applicable) Morningstar Rating metrics. Past pertormance is no guarantee of future results. Different shares Classes may have different ratings.
J.P. Morgan Funds are distributed by 1PMorgan Distribution Services. inc., which is an affiliate of JPMorgan Chase & Co. Affiliates of JPMOrgan Chase & Co. receive fees for
providing various services to the Funds. Products and services may be provided by 1PMorgan Distritrulion Serviws, Inc., member F1NRA/SIPC.
This piece was written as of Ql 2010.
1.P. Morgan Asset Management is the marketing name for the asset management businesses of 1PMOrgan Chase & Co. 7hose busfnesses indude, but are not limited to, 1.P. Morgan
Investment Management In�., Searity Capital Research & Management Incorporated and J.P. Morgan Alternative Asset Management, In�.
O 1PMorgan Chase & Co., August 2010
II-EME-KNOW
NOT fDIC INSURED I NO BANK GUARANTEE � MAY LOSE VALUE J P. Morgan
ORDINANCE 1410
AN ORDINANCE OF THE VILLAGE COUNCIL OF THE VILLAGE OF
TEQUESTA PALM BEACH COUNTY FLORIDA AMENDING EXH161T
"B" OF SECT{ON 2-30 QF THE CODE OF ORDINANCES VILLAGE OF
TEQUESTA FLORlDA RELATING TO THE EMPLOYEES PENSION
TRUST FUNDS; PROVIDfNG FOR iNCREASED INVESTMENTS IN
FOREIGN SECURITIES; PROVIDING FOR SEVERABiLiTY;
PROVIDlNG F4R REPEAL OF ORDINANCES iN CONFUCT;
PROVIDING FOR CODIFICATION; PROVIDING FOR AN EFFECTIVE
DATE.
BE IT ORDAINED BY THE VILLAGE COUNCIL OF THE VILLAGE OF
TEQUESTA, PALM BEACH COUNTY, FLORIDA AS FOLLOWS:
Section 1. Those portions of Exhibit "B" to Section 2-30, Code of Ordi�ances,
Village of Tequesta, Palm Beach County, Florida, as deleted and shown by strike-outs
and additions shown by underlining on Exhibit °B" attached hereto and made a part
hereof, are passed and adopted as amendments to such Exhibit and section.
Section 2. Severability. If any provision of this Ordinance or the application II
thereof is held invalid, such invalidity shall not affect the other provisions or applications
of this Ordinance wh�ch can be given effect without the invalid provisions or '
applications, and to this end, the provisions of the Ordinance are hereby deciared
severable.
Section 3. Repeal of Ordinances in Conflict. All other Ordinanoes of the
Village of Tequesta, Florida, or parts thereof which confliot with this or any part of this
Ordinance are hereby repeaied.
Section 4. Codification. This Ordinance shatt be codified and make a part of
the official Code of Ordinances of the Village of Tequesta.
Section 5. Effective Date. This Ordinance shall take effect upon passage.
Page 1 of 1
EXHIBIT "B '
VILLAGE OF TEQUESTA
PUBLIC SAFETY OFFICERS' PENSION TRUST FUND
TABLE OF CONTENTS i
Section 1 ......................................................................... Crea#ion of Pension Trust Fund. -1-
Section .......................................................................................................... Definitions. -1-
Section ....................................................................................................... Membership. -4-
Section .............................................................................................. Board of Trustees. -5-
Section 5 . ..................................................................... Finance And Fund Management. -7-
,
Section ......................................................................................................Contributions. -12-
Section 7 ........................................................................... Benefd Amounts and Eligibility. -14-
Section 8 ......................................................................................... Pre-retirement Death. -15-
Section9 ............................................................................................................ Disability. -16-
Section 10 ........................................................................Morrthly Supplementai Benefits. -19-
Section ............................................................................................................. Vesting. -19-
Section 12 .............................................................................. Optional Forms of Benefits. -19-
Section13 .................................................................................................... Beneficiaries. -21-
Section 14 ..................................................................... Deferred Ftetirement Option Plan. -22-
Section 15 ................................................ Claims Procedures Before tt� Board Decision. -24-
Section 16 . .................................................................. Reports to Division of Retirement. -26-
Section17 ............................................................................................ Roster of Retirees. -27-.
Section 18 ....................................................................Board Attomey and Professionals. -27-
Section ........................................................................................... Maximum Pension. -27-
Section 20 .............................................................................Commenoement of Benefits. -28-
�ection 21 ..................................................................................... Distribution of Benefits. -28-
Section 22 .......................................................................
........... Miscellaneous Provision. -29- �
Section 23 .....................................................................Repeal or Termination of System. -31-
Section 24 .................................................. Exemption from Execution, Non-assignability. -34-
Section 25 ............................................................................................... Pension Validity. -34-
Section 26 ........................................................................................ Forfeiture of Pension. -35-
Section 27 ............................................................... Military Seniice Prior to Employment. -37-
I
EXNIBtT "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
Pubiic Safety Officers' Pension Trust Fund for the purpose of providing retirement,
death and disabiiity benefits to Police Officers and Firefighters who are Members of this
Fund, certain former Village Police Officers and Fireflghters and survivor benefits to
beneficiaries.
Section 2. Definitions.
1. Statement of De�nitions. As used herein, unless othervvise defined or
required by the context, #he following words and phrases shail have the meaning
indicated:
Accumulated Gontributions means a Member's own contributions without
interest.
Actuarial Equivalent means a benefit or amount of equaf value, based upon the
mortality tables utilized by the Board's actuary or actuaries, and an 8°k rate of interest.
AveragQ Final Comnensation shall mean one-twelfth (1/12) of the average salary
of the five (5) best 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 o� Police Officer,
whichever is greater. A year shall be twelve (12) consecutive months.
Beneficiarv 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 fi{ed with the Board. If no designation is in effect, or if no person so designated is
iiving, at the time of death of the Member, the beneficlary shall be the estate of the
Member.
Board or Board of Trustees mean the Pubiic 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.
-1-
Cha�ters means Chapters 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 totai number of years and fractionat 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 membef I I
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
Viilage of Tequesta in a full time capacity within five (5) years, his/her contributions shall
be retumed to him/her without interest. Should a Police Officer or Firefighter be
subsequently re-employsd as such, he or she may re-purchase his or her years of credit
or fractional parts of years of credit by reimbursing such retumed contribution to the
Fund, with interest.
The years or fractional parts of years that a Firefighter, or Police Officer serves in �
the mititary 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 Vittage of Tequesta plan member, shall be added to
hisJher years of credited service for all purposes including vesting, provided that:
A. The Firefighter or Police Officer must retum to his/her futl time
employment with the Fire Department or Police Department within one (1)
year from the date of his/her military discharge. 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
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 betc�mes effective.
Fire Deoartment means the Tequesta Fire Department.
-2-
Firefi�hter means an actively employed full-time person employed by the Fire
Department, including hisJher initial probationary 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 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.
Police Deuartment means the Tequesta Police Department.
Police Officer means any person who is elected, appointed, or employed full time
by the Village, 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 aRns 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 of�icers
or auxiliary law enforcement officers as the same are defined in F.S. 943.10(6) and (8)
respectively. Police OfFicer also shall include a public safety officer who is respor�sible
for performing both police and fire services.
Public Safetv Board means the Public Safety Board of Trustees provided
hereunder to administer and manage Funds for the benefit of Public Safety Officers.
Public Safetv Officers means Firefighters and/or Police Officers.
Salarv means the total cash remuneration paid to a police officer or firefighter for
senrices rendered including Base Pay, Bonuses, Career Senrice Annual Award, Holiday
Pay, Incentives, Overtime, Sick Leave Payout on Termination, Sick-Leave Buy Back,
and Straight Time, and effective for payments made after 12/31/08, as provided for by
Intemal 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.
-3- ',
�I
Soouse means the lawful wife or husband of a pian 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 Viliage of Tequesta Public Safety Officers' Pension Trust
Fund as contained herein and all amendments thereto.
Vested deferred retirement means a Member who leaves the employ of the
Vilfage with 6 or more years of credited service and who is not eligible for any
retirement benefit. This benefit is payable at early or normal retirement.
Vitla e means the Village of Tequesta, Florida.
2. Masculine Gender. The masculine gender, where used herein, unless the
context specifica{ly requires otherwise, shall inctude both the feminine and masculine
genders.
Sectio� 3. Membership.
1. Condition of Eli�ibilitv
All fuli time Police Officers and Firefighters as of the effecctive date, and alt 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. Membershio
Each full time Police Officer or Firefighter shall 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. Chan�e in Desis�nation of Beneficiarv
-4-
A. A member may from time to time change hisJher designated beneficiary by
written notice to the Board upon forms provided by the Board. Upon such
change, the rights of a!I previously designated beneficiaries to receive any
benefits under the System shall cease.
B. Any retired member who desires to change his or her joint annuitant or
beneficiary shall file with the board of trustees a notarized notice of such
change. Upon receipt of a completed change of joint annuitant form or
such other notice, the board of trustees shall adjust the 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 member's current benefit and there is no impact to the Plan. Any I
costs associated with these benefit calculations shall be bome by the
member.
Section 4. Board of Trustees.
1. The sole and exclusive administratron 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.
The Public Safety Board shall consist of five (5) Trustees, two (2) of whom, i
unless otherwise prohibited by law, shail be legal residents of the Vitiage, who shall be
appointed by the Tequesta Village Council, and one (1) of wf�m shal{ be a fult-time
Police Officer member of the System and one (1) of whom shaN be a fuil-time Firefighter
member of the System. The fifth (5th) Tn.�stee shall be seleCted by a majority vote of
the other four (4) Trustees. Each person seeking to fill a des+gnated emptoyee '
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 Viltage Council shall, as a ministerial duty, appoint such person to the
Public Safety Board as its fifth (5th) Trustee. The fifth (5th) Trustee shail have the same
rights as each of the other Trustees appointed or elected as herein provided and shall
serve a two (2} year term uniess the office is sooner vacated and may succeed himself
or herself in office. Each resident Trustee shali serve as Trustee for a period of two (2)
years unless sooner rep{aced by the Tequesta Viliage Council at whose pleasure the
Trustee shaN serve, and may succeed himseff or herself as a Tn�stee. Each Police
Officer or Firefighter Trustee shall serve as Trustee for a period of two (2) years, unless
he/she sooner leaves the employment of the employee representative group helshe
-5-
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. 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, tt� 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
actions, proceedings, or hearings of the Board and shali preside over Board meetings in
the absence of the Chairman. The Trustees shall not receive any oompensation as
such, but may receive expenses and per diem as provided by Iaw.
3. Each Trustee shall be entitled to one vote. Three (3) affiRnative votes shall
be necessary for any decision by the Trustees at any meeting of the Board. A Tn�stee
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 shali engage such actuariai, acxounting, 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 applicabie 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 shali be paid from
the Fund they administer ar�d manage at such rates and in such amounts as the Board
of Trustees shalt approve.
�
5. The duties and responsibiltties of the Board of Trustees shall inciude, 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.
-6-
E. To distribute to Members, at regular interoals, infomnation
concerning the System.
F. To receive and process alf apptications for participation and
benefits.
G. To authorize ali payments whatsoever from the Fund and to notiiy
the disbursing agent, in writing, of approved pension payments and
other expenditures arising through operation of the System and the
Fund.
H. To have pertormed actuarial studies in accordance with Florida
Statute 112.63 providing a copy of the same to the Division of
Retirement, and with at least biennial valuations, and make
recommendations regarding and all changes in the provisions of
the System.
I. Ensure compliance with Article X, Sectjon 14, of the Florida
Constitution, requiring that any increase in benefits be funded on an
actuariaNy sound basis.
J. Ensure the completion of an actuarial impact statement prior to the
adoptio� of a change in the plan's retirement bene�its, a copy of '
which must be provided to the Division of Retirement.
K. To comply with the Chapters. I
L. To ensure the funds and assets for the benefit of the emptoyee I
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 ail funds under the control the Pubi�c Safety Board of
Trustees as required from time to time by F.S. 112.661, et seq.,
andlor its successor statutes.
O. To sue or be sued.
-7-
P. To settle, compromise or submit to arbitratbn (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 Manegement.
Establishment and Operation of Fund
1. As part of the System, there is hereby established a Fund, into wh+ch shalt
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 shaN 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.
i
3. All funds and securities of the Fund may be deposited by the Board of
Trustees with the Treasurer of the Vi{{age, acting in a ministeriai 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. However, any funds and securities so deposited
with the Treasurer of the Village shaU be kept in separate funds by the Treasurer or
clearty identified as such funds and securities of the Public Safety Officer Trust Fund. In
Ifeu thereof, the Board of Trustees shali 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, Fbrida 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. Atl funds and s�ecurities 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 reftecting the financial composition of the Fund and of
-8-
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 i
Viliage, County or State, and
E. AH 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. ��
I
6. An independent audit shall be performed annuaily 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 begln�ing
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 Boarcl 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 shali ever
resutt 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 inc�ome
thereof, without distinction between principal and income, shall be
held in the Fund and administered by the Board or its Agents.
-9-
B. All moneys paid into or to be held shall be invested and reinvested
by the Board and the investment of ali or any part of such funds
shali 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 aU 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 accou�ts 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 principai and interest by the govemment of the
United States.
(4) Bonds, stocks, commingled funds administered by
National or State Banks or evidences of indebtedness issued or
guaranteed by a corporation organized under the laws of the United �
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 c{assifications by a major
rating service, and if such investments are made in a pooled fund
administered by a state or national bank, then the rating of each
issue in the pooled fund shall hold a �ating within the top four (4)
rating classifications of a major rating service.
(5) Real estate.
(6) Up to ��°6 of Plan assets may be
invested in foreign securitfes.
� (7) Aii monies paid into or held in the Pension Fund shall
be invested and reinvested by the Board of Trustees a�d the
investment of all or any part of such funds shall be invested in
-10-
accordance with an established investment policy adopted by the
Board of Trustees.
C. The Board of Trustees sha0 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 aompany 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 cost exceed sixty percent (60%) of the assets of the 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 negiigence, 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 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 attomey 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.
-11-
H. The Board shall not be required to make any inventory or appraisai
or report to any court, nor secure any order of court for the exercise
of any power contained herein. '
!. Where any action which the Board is required to take on any duty
or funati�on which it is requ+red to perform either under the terms
herein or under the general taw 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. I
K. The Board shall sustain no fiabiiity whatsoever for the sufficiency of I
a Fund to meet the payments and benefits herein provided.
L. Any of the foregoing powers and fun�tions reposed in the Board
may be performed or carried out by the Board through duly
authorized Agents, provided that the Board at af{ 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.
M. The Board shall not invest more than ten percent (10°/a) at cost of
its assets in real property or real estate and there shall be no
investrnent in a iimited partnership or trust.
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. Notwithstanding anything eise in this subsection and as provided in
Fbrida Statutes §215.473, the board of trustees must identify and
-12-
pubticty 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 seli, redeem, divest, or
withdraw ali pubiicly traded securities it may have directly in that
company. The divesture of any such security must be oompleted
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 boarci 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. '
Sectlon 6. Co�tributions. ��
1. Member Contributions
A. Amount. Effective the first full payrol! period after the effective date �'
of this Ordinance, Police Officer Members of the Retirement
System shall be required to make regular contributions to the Fund
in the amount of five percent (5%) of his/her salary effective the first
full payroll period after the effective date of this Ordinance,
Firefighter Members of the Retirement System shall be required to
make regular contribution to the Fund in the amount of five percent
(5�0) of hisJher salary. The funding for the difference between the
previously required contribution of 6.1 % and the now required 5%
shail 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 %. 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
-13-
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 Federai Income Tax purposes. For all
other purposes of the Plan, such contributions shall be considered
to be Member contributions.
B. Method. Such contributions shatl be made by payroll deduction.
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. i
3. Vil{aae Contributions
So tong 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 ac#uarial deficiency shown by an actuarial valuation as provided in
Part VII of Chapter 112, Fbrida Statutes.
4. ther
Private donations, gif#s and contribut+ons 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 may be used only for additionat benefits for �i
Members, as determined by the Board of Trustees, and may not be used to reduce
what would have otherwise been required by Village contributions.
Section 7. Beneflt Amounts and Eligibility.
1. Normal Retirement Date
A Member's normai retirement date shall be the first day of the month
coincident with, or the next foilowing the earlier of:
A. attainment of age fifty-five (55) and the compietion of six (6) years
of credited service, or
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B. . attainment of age fifty-two (52) and the completion of twenty-five
(25) years of credited service.
A Member may retire on hislher nonnal retirement date or on the first day
of any month thereafter, and each Member shall become 100°lo vested in his/her
accrued benefit on the Member's normal retirement date. Normal retirement under the
Plan is retirement from empioyment with the Village of Tequesta as a Police Officer or
Firefighter on or after the normal retirement date.
2. Normal Retirement Benefit
A Member retiring hereunder on or after his/her normal retirement date
shail receive a monthly benefit which shail 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 monthly
retirement benefit sha11 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 next 6 years of service I
2.0% for the next 4 years of service
3.0% for atl years after 25 years I
3. Earlv Retirement Date
�
A Member may retire on hisJher early retirement date which shall be the
first day of any month coincident with or next following the later of the attainment of age i
fifty (50) and the completion of six (6) years of credited service. Early retirement under
the Plan is retirement from employment with the Vitiage of Tequesta on or after the ea�iy
retirement date and prior to the normal retirement date.
4. Earlv Retirement Benefit
A Member retiring hereunder on hislher early retirement date may receive
either a deferred or an immediate monthly retirement benefit payable for life, but with
one hundred twenty (120) monthly payments guaranteed in any event, as foilows:
A. deferred monthiy retirement benefit which shall commence on what
would have been hisJher 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
de�erred monthly retirement benefit shali be determined in the
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same manner as for retirement as his✓her normal retirement date
except that credited senrice and average final compensation shall
be detennined as of hisJher early retirement date; or
B. immediate monthly retirement benefit which shall commence on
his/her early retirement date and shall be continued on the first day
of each month thereafter. The benefft payable shaii be as
determined in paragraph A above, which is actuarially reduced from
the amount to which he/she would have been entitled had helshe
retired on hisJher normal retirement date and with the same number
of years of credited service as at the time his✓her benefit commence
and based on hisJher 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-retireme�t Death.
If a plan member dies prior to retirement from the Village of Tequesta
hisJher beneficiary shall receive a benefit as foNows:
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. i
B. Non-Line-of-Duty-Death-Benefit the spouse of a member with 6 I
years of credited service will receive the actuariaf equivalent of the
accrued normal retirement benefit.
C. In lieu of the benefits provided in A or B above, the beneficiary of a
police officer or firefighter, with 6 or more years of service who dies
prior to retirement, may receive the benefits otherwise payable to
the police officer at what would have been his✓her early or noRnai
retirement date.
Section 9. Disability.
1. Disabilitv Benefits On-Dutv
Each fuil time empbyee who is a participant in the Pension Fund System and
who becomes totally and permanentfy disabled while an active employee of the Viilage
of Tequesta to the extent that he/she is unable, by reason of a medically determinable
physical or mentai impairment, to render usefu{ and efficient service as a Pol'�ce Officer
-16-
or Firefighter, as was provided by the employee in their classification (Police Officer or
Firefighter) prior to the atleged impairment, which disability was directly caused by the
perfonnance of his/her duty as a Police Officer or Firefighter shaU upon establishing the
same to the satisfaction of the Board, be entitled to:
A. If the injury or disease is service connected, the employee shali be
entitled to the greater of (1) or (2):
(1) a monthly pension equal to 42% of hisJher 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 i
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 shail not apply to benefits payable or
granted in a policy of life insurance or disabiiity insurance. ln order to be
entitled to the presumption in the case of hepatitis, meningococ�al
meningitls, or tuberculosis the member must meet the requirements of
Section 112.181, Florida Statutes.
2. Disability Benefits Off-Dutv
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 I
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 hisJher duties as a Police Officer or Firefighter
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 Disaualifvins� Disabititv Benefits
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Each Poiice 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 itlegally participating
in fights, riots or civil insurrections.
C. Injury o� disease sustained while committing a crime.
D. Injury or disease sustained while serving 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 Herces 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 i
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 Poiice Department and arising out i,
of such employment.
G. Injury or disease sustained by the member before empfoyment with
the Village begins. This subparagraph applies on{y in the event of
a duty +njury or disease. ;
4. Phvsical E�camination Reauirement
- 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 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 tonger 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 retumed to their previous performance of duty as a Police Officer or Firefighter, and
the retiree so returned shaN enjoy the same rights that Member had at the time helshe
was placed upon pension. In the event the retiree is so ordered to retum shall refuse to
-1$-
comply with the order within thirty (30) days from the issuance thereof, Member shall
forteit the right to hisJher pension.
The cost of the physical examination and/or re-examination of the
employee or retiree claiming andlor receiving disability benefits shall be bome 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 bome by the Board.
If the retiree recovers from disability and reenters hisJher former service
with the Village of Tequesta held prior to disability retirement, hisJher service will be
deemed to have been continuous, but the period t�eginning 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 wili not be considered as credited sen�ice for
the purposes of the Plan.
The Board shall have the power and authority to make the final decision
regarding ati disability claims.
5. Disabititv Pavments
The monthty benefit to which a Member is entitied 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 partia! month shaN 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 prec�ding 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 hisJher death or the 120th monthly payment,
whichever is later.
Section 10. Monthly Supplementel 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.
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2. This benefit shall be payabie monthly as a part of the regular monthly
pension benefit. The benefit shati be payable to the retiree and any
beneficiary. The benefit shall cease upon the death of the member or
beneficiary, if applicable.
�
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Section 11. Vesting.
If a Member terminates hisJher empbyment 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. If the Member has less than six (6) years of credited service upon '
termination, the Member shall be entitled to a refund of hislher accumulated contribution
or the Member may leave it deposited with the Fund.
2. If the Member has six (6) or more years of credited service upon ',
termination, the Member shall be entitled to a monthiy 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 acxumulated contributions and provided the Member
survives to his/her normal or early retirement date.
Section i 2. O tionat Forms of Benefits. ��
P
1. {n lieu of the amount and form of retirement income payable in the event
of normal, earfy, or disabiliiy retirement as specified herein, a plan member, upon
written request to the Board of Trustees, and subject to the approvai of the Board of I
Trustees, may elect to receive a retirement income or benefit of equivalent actuarial
valuation payable in aa:ordance with one of the folbwing options:
A. A retirement income of a larger month{y amount, payabfe to the
Membe� for hislher 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 folbwing the death
of either of them, 100%, 76%, 66-2/3%, or 50% of such monthly
amounts payable to the sunrivor for the lifetime of the survivor.
C. Such other amount and form of retirement payments or benefits as,
in the opinion of the Board of Trustees, will best meet the
circumstances of the retiring Member.
2. The Member, upon electing any optbn 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 wili have the power to change
such designation from time to time, but any such change shafi be deemed a new
-21-
election and will be subject to approvai by the Board of Trustees. Such designation will
name a joint pensioner or one or more primary beneficiaries where applicable. If a
Member has elected an option with joint pensioner or beneficiary and the Member's
retirement income benefits have commenced, the Member may thereafter change
hisJher designated joint pensioner or beneficiary, but only if the Board of Trustees
consents to change and if the joint pensioner or beneficiary, but only if the Board of
Trustees consents to change and if the joint pensioner last previously designated by the
Member is alive when he/she files w�th the Board of Trustees the request for such
change.
3. The consent of joint pensioner or beneficiary to any such change shall not
be required.
4. 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 payabie 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 fited with the Board of Trustees.
tn 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 Se�tion 12.
5. Retirement income payments shall be made under the option eiected in
accordance with the provisions of this section and shall be subject to the fotiowing �
limitations:
A. If a Member dies prior to his/her normal retirement date or early
retirement date, whichever occurs, no retirement benefit wiN 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 automaticalty and a retirement income of
the normal form and amount will be payable to the Member upon
hisJher retirement as if the election had not been made, untess a
new election is made in accordance with the provisions of this
section or a new beneficiary is designated by the Member prior to
hisJher retirement and within ninety (90) days after the death of the
beneficiary.
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C. If both the retired Member and the beneficiary (or beneficiaries)
designated by the Member die before the fuli 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 hisJher 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.
6. The Member may not change his/her retirement option after the date of
cashing or depositing his✓her first retirement check.
Section 13. BeneNciaries.
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 hisfier 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.
2. If a deceased Member fails to name a bene�ciary 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. Oeferred Retirement Optlon Plan.
-23- .
1. Elis�ibility to Particioate in the Droo
A. Any member who is eligible to receive a normai retirement pension
may participate in the DROP. Members shaii elect to participate by
applying to the Board of Trustees on a form provided for that
pu��•
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 'I
extended to those members with twenty-eight (28) years of service
in 2003.
C. A member shall not participate in the DROP beyond the time of
attaining 30 years of service and the total yesrs of participation in '
the DROP shall not exceed five (5) years. For example: j
I
(1) Members with twenty-five (25) years of credited senrice at
time of entry shaU only participate for five (5) years.
(2) Members with twenty-six (26) years of credited service at
time of entry sha{I only participate for #our (4) years.
(3) Members with twenty-seven (27) years of credited service at ',
time of entry shall only participate for three (3) years.
D. Upon a member's election to participate in the DROP, he or she
shall cease to be a member and is precluded from accruing any
additional benefit under the Pension Fund. For all Fund purposes,
the member becomes a retirant. The amount of credited service
and final average salary freeze as of the date of entry into the
DROP.
2. Amounts Pavable uuon Election to Particioate in DROP
A. Monthly retirement benefits that would have been payable had the
member terminated employment with the department and elected
to receive monthiy 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.
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B. Payments to the DROP earn interest using the rate of investment
return earned on Pension Fund assets during the twelve (12) month
period ending September 30th. The rate determined shall be the
rate reported to the Division of Retirement pursuant to Part Vil of
Chapter 112, Florida Statutes. However, if a police officer or
firefighter does not terminate employment at the end of participation
in the DROP, interest credits shaN cease on the current baiance
and on all future DROP deposits.
C. No payments will be made from DROP until the member terminates
employment with the department.
D. Upon termination of employment, participants 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 shaii be made in either:
a. Lump sum - the entire account balance will be paid to
the retirant upon approvai of the Board of Trustees.
b. Installments - the account balance wiil be paid out to
the retirant in three equaf 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
compy with the minimum distribution requirements of the
IRC 401(A)(9) e.g., payments must commence by age 70�/�.
(4) The beneficiary of the DROP participant who dies before
payments from DROP begin shall have the same right as the
participant in accordance with Ordinance.
-25-
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
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
heatth 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 shaN include:
A. The specific reasons for the denial, including specific references to
pertinent provisions of the retiremer►t system on which such denial
is based;
B. A description of any additional material or information that the
Board feels is necessary for the Member to perfect hislher claim,
together with an expianatton of why such material or information is
necessary; and
C. An explanation of the review procedure next open to the Member.
Such review procedure shail provide that:
-26-
(1) Prior to such review, the Member or hisJher duly authorized
represerrtative 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 hisJher duly
authorized representative shall submit their case in writing to
the Board and request a hearing, Such submission shatt be
filed with the Board no Iater ,than ninety (90) days after the
receipt of the order of the Board. Upon receipt of the writfen
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 consider the facts presented at the scheduled
hearing and shali, within thi►ty (30) days after such hearing,
make a finat ruling in writing on the request of the Member.
The written decision shali include the reasons for such
decision and, such decision shatt be final.
(a) The Chairman shal{ preside over the hearing and
shall rute 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 pardes 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 shali be under oath
or affirmation. Depositions or affidavits shall not be
admissibie unless upon stipulation by all parties. The
Chairman, any Member of the Board, the attomey for
the Board, the ciaimant and the claimant's attomey,
upon recognition by the Chairman, may direct
-27-
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 t�anscription of the proceedings.
(c) In all cases, unless otherwise provided in this se�tion,
the burden of proof shall be on the claimant who
seeks to draw hisJher 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.
Section 16. Reports to Division of Retiroment.
Each year no later than March 15th, the Chairman of the Board shall file two (2)
separate repo�ts 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 incfuded in the Pension Plan, the number of Police Officers
-2$-
ineligibie, 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 ineiigible,
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
repo�t of the Plan. Such valuation shall be prepared by an enrolled actuary who is
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 Retlrees.
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 I
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.
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The Board may empioy 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. Meximum Penston.
1. Basic Limitation.
Subject to the adjustments herein set forth, the maximum amount of
annual retirement income payable with respect to a Member under this Plan shall not
exceed the limits contained in §415 of the Code.
2. Additional Limitation on Pension Benefits. Notwithstanding anything
herein to the contrary:
A. The normai retirement benefit or pension to a retiree who becomes
a member of the Plan and who has not previousiy 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 shail apply to supplementai retirement
benefits or to pension increases attributable to cost-of-living
increases or adjustments.
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 securily benefits or
federal benefits under Chapter 67, Title 10, U.S. Code.
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
shatl commence not later than the 60th day after the close of the Plan Year in which the
latest fotlowing events occur:
A. The attainment by the Member of age 65;
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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 Viliage 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 Mem�r'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 beneflt was scheduled to begin but which is not later than the date
specified under subsection 1 of this Section.
Section 21. Distribution of Benefits.
Notwithstanding any other provision of this Plan to the contrary, a form of
retirement income payable from this Plan after the effective date of this ordinance, shail
satisfy the following conditions:
1. {f the retirement income is payable before the Member's death, the
d'+stribution shall commence to them not later than the calendar year defined above; and
A. shall be paid over the life of the Member or over the lifetimes of the
Member and spouse, issue or dependent, or,
B. shall be paid over the period extending not beyond the life
expectancy of the Member and spouse, issue or dependent.
Where a form of retirement income payment has commenced in accorda�ce 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 rapidiy than under the form of distribution in effect at the time of the
Member's death.
2. If the Member's death occurs before the distribution of hisJher 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:
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A. The Member's remaining interest in the Plan is payable to his✓her
spouse, issue or dependent;
B. The remaining interest is to be distributed over the life of the
spouse, issue or dependent or over a period not extending beyond
the life expectancy of the spouse, issue or dependent; and
C. 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�/�
and ff 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.
Sectlon 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 accrued
benefits to Members or Members beneficiaries.
3. Rollover Distributions
A. This subsection applies to distributions made on or after January 1,
1993. Notwithstanding 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 rolbver.
B. Definitions.
(1) "Eligible rollover distribution" is any distribution of all or any
portion of the balance to the credit of the distributee� except
that an eligible rollover does not include any distribution that
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is one of a series of substantially equal periodic payments
(not less frequently than annuaily) made for the life (or life
expectancy) of the distributee or distributee's designated
beneficiary, or for a specified period of 10 years or more; any
distribution to the extent such distribution is required under
. section 401(a)(9) of the Code; and the portion of any
distribution that is not includible in gross income.
(2) "Eligible retirement plan" is an individual retirement account
described in section 408(a) of the Code, an individual
retirement annuity described in sectiion 408(b) of the Code,
� an annuity plan described in section 403(a) of the Code, or a
qualified trust described in section 401(a) of the Code, that
accepts the distributee's eligible rollover distribution.
However, in the case of al eligible rollover distribution to the
sunriving spouse, an eligible retirement plan is an individual
retirement account or individual retirement annuity.
(3) "Distributee" incl�rdes 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 payment for alimony and child support
under a domestic retations order determined to be qualffied
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 enti�ed to receive benefits
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�i
under one of the options provided for in this Ordinance who are designated by any of
said Members. In the event of repeal, or if contributions to the System are discontinued,
there shall be full vesting (100%) of benefits accrued to date of repeal. The actuarial
singie-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 previousty
paid to the employee.
3. Upon teRnination of the plan by the Village for any reason, or because of a
transfer, merger, or consolidation of govemmental 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.
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 poiice officer
and firefighter entitled to benefits under the plan, as spec'rfied 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
empbyee.
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D. If there is asset value remaining after the full distribution specffied
in subsection C, and after payment of any expenses incurred with
such distribution, such excess shall be returned to the Village, less
retum 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 dist�ibution 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. Exemptton 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
state, county or municipal tax of the state and shall not be subject to execution,
attachment, gamishment 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 acxordance 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 Viliage;
2. pay the certified bargaining agent; or
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3. to pay for premiums for accident health and long-term care insurance for
the retiree, the retiree's spouse and dependants. A retirement plan dces
not incur liabifity for participation in this permissive program if its actions
are taken in good faith pursuant to Fior�da Statutes §§175.061(7) and
185.05(6).
Section 25. Pension Vatidity.
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 illegaAy 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
reciassify any person who has heretofore under any prior or existing law been or who
shall hereafter under this Ordinance be erroneously, improperly or illegally classi�ed.
Sectfon 26. Forteiture of Penaion.
Any Member convicted of the foitowing offenses committed prior to retirement, or
whose employment is terminated by reason of hisJher admitted commission, aid or
abatement of the following specified offenses, shall forFeit ali rights and benefits under ,
this Pension Fund, except for the retum 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;
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 ofi an impeachable offense.
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F. The committing of any felony by a public officer or employee who
witlfu{ly 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 a�y felony defined in Chapter 794, Florida Statutes against
a victim younger than 18 years of age, by a pubiic officer or
empbyee through the use or attempted use of power, rights,
privileges, duties, or position of his or her pubiic office or .
empbyment position.
2. Definitions
A. Conviction shall be defined as: '
An adjudication of guilt by a court of competent jurisdiction; a
plea of gui{ty or nolo contendere; a jury verdict of guitty when
adjudication of guilt is withheld and the accused is placed on
probation; or a conviction by the Senate of an impeachable offense.
B. Gourt shaU be defined as:
Any state or federal court of competent jurisdiction which is
exercising jurisdiction to consider a proceeding involving the
alleged commission of a specified offense. Prior forfeiture, the
Boarcl of Trustees shall hold a hearing on which notice shali be
given to the Member whose benefits are being considered for
forfeiture. Said Member shall be afforded the right to have an
attomey 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 hislher accumuiated contributions after Member's rights were forfeited
shall be required to pay back to the Fund the amount of the benef'its
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received in excess of hisJher accumulated contributions. The Board of
Trustees may implement �il iegal 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 wiltfully 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 materiai 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 pian 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 benef'�ts to which the
person would otherwise be entitled under this Ordinance. For
purposes of this paragrapfi, "conviction" means a determination of
guilt that is the result of a pleas or triat, regardless of whether
adjudication is withheld.
Section 27. Military Service Prior to Employment.
The years or fractional parts of years that a Member serves o� 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 employmerit 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 ail professionai services rendered to the Boarcl in connection with
the purchase years of credited senrice.
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2. The request shall be made only once and made by the Member on or
before the later of twelve (12) months from the effective date of this Ordinance or six (6)
months from the date of hisJher empioyment with the Police Department or Fire
Department, whichever is tater.
3. Payment by the Member of th� required amount shal{ be made within six
(6) months of his/her request for credit and shaii be made in one fump sum payment
upon receipt of which credited service shal{ be given. Credited service purchased
pursuant to this section shall be counted for all purposes except toward vesting of
benefits.
4. The ma�cimum credit under this section shall be five (5) yrears. '
Bs,�
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H:\Tequesta PS 1011�PIan Docs & RulesVlmend1201012010 Restettem�►t (amend for 2b96 foreign).wpd
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