HomeMy WebLinkAboutDocumentation_Pension Public Safety_Tab 05C_11/09/2004
GABRIEL, ROEDER, SMITH & COMPANY
Consultants & Actuaries
301 East Las Olas Blvd. • Suite 200 • Ft. Lauderdale, FL 33301-2254 •954-527-1616 • FAX 954-525-0083
November 4, 2004
James Weinand, Chairman
Public Safety Officers Board of Trustees
Village of Tequesta
357 Tequesta Drive
Tequesta, FL 32960-6441
Re: Proposed Change in Pension Benefits
Dear Jim:
As requested, we have prepared a cost study for the following set of benefit changes:
1. Eligibility to retire after 25 years of service regardless of age
2. Multiplier changes to 3.0% for years sixteen through twenty-one
3. Multiplier changes to 3.0% after twenty-five years of service
4. Supplemental benefit increased to $20.00 for each year of service (maximum $600)
5. Combination of 1, 2, and 4
6. Combination of 2, 3, and 4
We welcome your questions and comments.
Sincerely yours, ,
~ -~~
1
J. Stephen Palmquist
Enclosures
SUPPLEMENTAL ACTUARIAL VALUATION REPORT
Plan
Village of Tequesta Employees Pension Trust Fund
Valuation Date
October 1, 2003
Date of Report
November 4, 2004
Report Requested by
Board of Trustees
Prepared by
J. Stephen Palmquist
Group Valued
All Members
Plan Provisions Being Considered for Change
Present Provisions
1. Tiered Multiplier
3.0% for each of the first six years
3.5% for each of the next four years
4.0% for each of the next five years
2.5% for each of the next six years
2.0% for each year after 21 years
2. $5.00 Supplemental Benefit for each year of service
3. Normal Retirement at age 52 with 25 years service
Proposed Changes
1. Eligibility to retire after 25 years of service regardless of age
2. Multiplier changes to 3.0% for years sixteen through twenty-one
3. Multiplier changes to 3.0% after twenty-five years
4. Supplemental benefit increased to $20.00 for each year of service (max. $600)
5. Combination of 1, 2, and 4
6. Combination of 2, 3, and 4
Participants Affected
All active plan members
Actuarial Assumptions and Methods
Same as October 1, 2003 Actuarial Valuation Report with no exceptions.
Some of the key assumptions/methods are:
Investment return - 8.0% per year
Salary increase - 6.0% per year
Cost Method - Aggregate
Amortization Period for Any Increase in Actuarial Accrued Liability
NA
Summary of Data Used in Report
NA
Actuarial Impact of Proposal(s)
See attached page(s).
Special Risks Involved With the Proposal That the Plan Has Not Been Exposed to
Previously
None.
Other Cost Considerations
None
Possible Conflicts With IRS Qualification Rules
None
~ ,~~.~.
J. tephe Palmquist, ASA, , FCA
Enrolled Actuary No. 02-1560
A. Valuation Date
B. ARC to Be Paid During
Fiscal Year Ending
C. Assumed Date of Employer Contrib.
D. Annual Payment to Amortize
Unfunded Actuarial Liability
E. Employer Normal Cost
F. ARC if Paid on the Valuation
Date: D+E
G. ARC Adjusted for Frequency of
Payments
H. ARC as % of Covered Payroll
I. Assumed Rate of Increase in Covered
Payroll to Contribution Year
~. Covered Payroll for Contribution Year
K. ARC for Contribution Year: H x J
- _____
L. Allowable Credit for Chapter Revenue
M. Required City Contribution: K - L
N. REC as % of Covered Payroll in
Contribution Year: M _ J
PpLICB pFFICERS A,~fNUAL REQl11R~D CONTI~I~UTtON
~-, ~;
, C'7 ~~ ~°~ ,
1 2003 October 1, 2003
October
Valuation 52 and 25 NRD
ro 25 and out October`1, 2003
Multiplier to 3.0%
for years 16-21 October 1, 2003
Multiplier to 3.0%
after 25 years Octob ersU 2003
R pp
benefit to $20 O Combinatio003
of 1, 2, and 4 O Combinabo003
of 2, 3, and 4
9/30/2005
Month/
Y 9/3012005
Monthly 913012005
Monthly 9/30/2005
Monthly 9/30/2005
Monthly 9/30/20015
Mont y 9/ n01on00 y ~
$ 0 $
53,969 0
55,116 $ 0
6,008 $ 0
3,969
0
$
58,175
$ 0
62,890
$ 0
61,361
53,969 55,116 56,008 53,969
58,175
62,890
61,361
56,225
°
13.24 /o 57,420
13.52 58,349
% 13.74 56,225
% 13.24
60,607
% 14.27
65,519
15.42
63,926
% 15.05
0
4.00 /0
441,787
58,493 ;;~~ ~
- _!-_
25,134
33,359 4.00
~ 441,787
,/~ 1f15g,730
26,371
33,359 % 4.00
441,787
60,702
27,343
33,359 % 4.00
441,787
58,493
25,134
33,359
4.00
441,787
63,043
29,684
33,359
% 4.00
441,787
68,124
34,765
33,359
% 4.00
441,787
66,489
33,130
33,359
7.55 %
7.55 °
/0 7.55 ° 7.55
/o % 7.55 % 7.55 % 7.55
FIREFIGHTERS ANNUAL REQUIRED CONTRIBUTION
A. Valuation Date October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003
Valuation 52 and 25 NRD Multiplier to 3.0% Multiplier to 3.0% Raise suppl. Combination Combination
to 25 and out for years 16-21 after 25 years benefit to $20 of 1, 2, and 4 of 2, 3, and 4
B. ARC to Be Paid During
Fiscal Year Ending 9/30/2005 9/30/2005 9/30/2005 9/30/2005 9/3012005 9/30/2005 9/30/2005
C. Assumed Date of Employer Contrib. Monthly Monthly Monthly Monthly Monthly Monthly Monthly
D. Annual Payment to Amortize
Unfunded Actuarial Liability $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
E. Employer Normal Cost 134,132 144,104 142,823 136,511 148,953 169,355 160,023
F. ARC if Paid on the Valuation
Date: D+E 134,132 144,104 142,823 136,511 148,953 169,355 160,023
G. ARC Adjusted for Frequency of
Payments 139,739 150,128 148,793 142,217 155,179 176,434 166,712
H. ARC as % of Covered Payroll 15.27 % 16.41 % 16.26 % 15.55 % 16.96 % 19.29 % 18.22
I. Assumed Rate of Increase in Covered
Payroll to Contribution Year 4.00 % 4.00 % 4.00 % 4.00 % 4.00 % 4.00 % 4.00
J. Covered Payroll for Contribution Year 951,467 951,467 951,467 951,467 951,467 951,467 951,467
K. ARC for Contribution Year: H x J 145,289 156,136 154,709 147,953 161,369 183,538 173,357
L. Allowable Credit for Chapter Revenue 50,733 61,580 60,153 53,397 66,813 69,132 69,132
M. Required City Contribution: K - L 94,556 94,556 94,556 94,556 94,556 114,406 104,225
N. REC as % of Covered Payroll in
Contribution Year: M _ J 9.94 % 9.94 % 9.94 % 9.94 % 9.94 % 12.02 % 10.95
POLICE OFFICERS ACTUARIAL VALUE OF BENEFITS ANQ AS5ET5
A. Valuation Date October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003
Valuation 52 and 25 NRD Multiplier to 3.0% Multiplier to 3.0% Raise suppl. Combination Combination
to 25 and out for years 16-21 after 25 years benefit to $20 of 1, 2, and 4 of 2, 3, and 4
i $ 1,011,830 $ 1,051,552 $ 1,094,448 $ 1,089,064
3 90,484 96,936 106,151 97,867
3 121,689 128,056 125,296 130,094
3 35,991 37,904 36,726 38,216
3 7,683 7,683 7,683 7,683
a 1,267,677 1,322,131 1,370,304 1,362,924
a 1,267,677 1,322,131 1,370,304 1,362,924
I 187,013 194,097 208,067 201,349
NA NA NA NA
? 357,160 358,282 358,282 358,282
i 5,396,996 5,396,996 5,334,454 5,396,996
269,850 269,850 266,723 269,850
FIREF{GHTERS ACTUAR{AL VALUE OF `BENEFITS AND ASSETS
A. Valuation Date October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003
Valuation 52 and 25 NRD Multiplier to 3.0% Multiplier to 3.0 % Raise suppl. Combination Combination
to 25 and out for years 16-21 after 25 years benefit to $20 of 1, 2, and 4 of 2,3, and 4
B. Actuarial Present Value of All Projected
Benefits for
1. Active Members
a. Service Retirement Benefits $ 2,796,246 $ 2,843,921 $ 2,885,695 $ 2,822,180 $ 2,925,652 $ 3,072,461 $ 3,041,036
b. Vesting Benefits 233,233 270,156 236,188 233,365 249,745 292,764 252,844
c. Disability Benefits 277,931 257,361 282,828 278,300 293,929 276,840 299,341
d. Preretirement Death Benefits 89,613 83,332 90,307 89,681 94,949 88,965 95,740
e. Return of Member Contributions 7,811 7,811 7,811 7,811 7,811 7,811 7,811
f. Total 3,404,834 3,462,581 3,502,829 3,431,337 3,572,086 3,738,841 3,696,772
2. Inactive Members
a. Service Retirees & Beneficiaries - - - - - - -
b. Disability Retirees - - - - - - -
c. Terminated Vested Members - - - - - - -
d. Total - - - - - - -
3. Total for All Members 3,404,834 3,462,581 3,502,829 3,431,337 3,572,086 3,738,841 3,696,772
C. Actuarial Accrued (Past Service)
Liability per GASB No. 25 1,433,188 1,462,836 1,475,813 1,441,376 1,506,186 1,581,519 1,555,988
D. Actuarial Value of Accumulated Plan
Benefits per FASB No. 35 NA NA NA NA NA NA NA
E. Plan Assets
1. Actuarial Value 1,607,866 1,607,866 1,607,866 1,607,866 1,607,866 1,607,866 1,607,866
F. Actuarial Present Value of Projected
Covered Payroll 10,304,009 10,007,915 10,304,009 10,304,009 10,304,009 10,007,915 10,304,009
G. Actuarial Present Value of Projected
Member Contributions 515,200 500,396 515,200 515,200 515,200 500,396 515,200
1'OLICEO~FICERSDERIVATION OF NORMAL COST
A. Valuation Date October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003
Valuation 52 and 25 NRD Multiplier fo 3.0% Multiplier to 3.0% Raise suppl. Combination Combination
ro 25 and out for years 16-21 after 25 years benefit to $20 of 1, 2, and 4 of 2, 3, and 4
B. Actuarial Present Value of Projected
Benefits $ 1,260,921 $ 1,272,784 $ 1,294,569 $ 1,267,677 $ 1,322,131 $ 1,370,304 $ 1,362,924
C. Actuarial Value of Assets 350,404 358,282 358,282 357,160 358,282 358,282 358,282
D. Unfunded Actuarial Accrued Liability 0 0 0 0 0 0 0
E. Actuarial Present Value of Projected
Member Contributions 269,850 266,723 269,850 269,850 269,850 266,723 269,850
F. Actuarial Present Value of Projected
Employer Normal Costs: B-C-D-E 640,667 647,779 666,437 640,667 693,999 745,299 734,792
G. Actuarial Present Value of Projected
Covered Payroll 5,396,996 5,334,454 5,396,996 5,396,996 5,396,996 5,334,454 5,396,996
H. Employer Normal Cost Rate: F/G 11.87 % 12.14 % 12.35 % 11.87 % 12.86 % 13.97 % 13.61
I. Covered Annual Payroll 424,795 424,795 424,795 424,795 424,795 424,795 424,795
J. Employer Normal Cost: H x I 50,423 51,570 52,462 50,423 54,629 59,344 57,815
K. Assumed Amount of Administrative
Expenses 3,546 3,546 3,546 3,546 3,546 3,546 3,546
L. Total Employer Normal Cost: J+K 53,969 55,116 56,008 53,969 58,175 62,890 61,361
M. Employer Normal Cost as % of
Covered Payroll 12.70 % 12.97 % 13.18 % 12.70 % 13.69 % 14.80 % 14.44
FiREFIGNTERS tVORMAI. COST DERIVATION
A. Valuation Date October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003 October 1, 2003
Valuation 52 and 25 NRD Multiplier to 3.0% Multiplier to 3.0% Raise suppl. Combination Combination
to 25 and out for years 16-21 after 25 years benefit to $20 of 1, 2, and 4 of 2, 3, and 4
B. Actuarial Present Value of Projected
Benefits $ 3,404,834 $ 3,462,581 $ 3,502,829 $ 3,431,337 $ 3,572,086 $ 3,738,841 $ 3,696,772
C. Actuarial Value of Assets 1,607,866 1,607,866 1,607,866 1,607,866 1,607,866 1,607,866 1,607,866
D. Unfunded Actuarial Accrued Liability 0 0 0 0 0 0 0
E. Actuarial Present Value of Projected
Member Contributions 515,200 500,396 515,200 515,200 515,200 500,396 515,200
F. Actuarial Present Value of Projected
Employer Normal Costs: B-C-D-E 1,281,768 1,354,319 1,379,763 1,308,271 1,449,020 1,630,579 1,573,706
G. Actuarial Present Value of Projected
Covered Payroll 10,304,009 10,007,915 10,304,009 10,304,009 10,304,009 10,007,915 10,304,009
H. Employer Normal Cost Rate: F/G 12.44 % 13.53 % 13.39 % 12.70 % 14.06 % 16.29 % 15.27
I. Covered Annual Payroll 914,872 914,872 914,872 914,872 914,872 914,872 914,872
J. Employer Normal Cost: H x I 113,810 123,782 122,501 116,189 128,631 149,033 139,701
K. Assumed Amount of Administrative
Expenses 20,322 20,322 20,322 20,322 20,322 20,322 20,322
L. Total Employer Normal Cost: J+K 134,132 144,104 142,823 136,511 148,953 169,355 160,023
M. Employer Normal Cost as % of
Covered Payroll 14.66 % 15.75 % 15.61 % 14.92 % 16.28 % 18.51 % 17.49