HomeMy WebLinkAboutAgenda Police Pension 051012Agenda
City of Palm Beach Gardens Po /ice Officers'
Pension Fund
SPECIAL MEETING OF MAY 10, 2012
LOCATION: City Council Chambers'
10500 North Military Trail
Palm Beach Gardens, FL 33410
TIME: 9 AM
1. Call Meeting To Order
2. Roll Call:
• Lt. Jay Spencer, Chairman
• David Pierson, Secretary
• Brad Seidensticker, Trustee
• Marc Glass, Trustee
• Wayne Sidey, Trustee
3. Presentation of the September 30, 2011 Actuarial Valuation Report - GRS (Steve
Palmquist)
4. Attorney Report - Law Offices of Perry & Jensen (Bonni Jensen)
• Memo - Annual Form 1 Filing
• Memo - State & Tax Law Updates
5. Public Comments
6. Adjourn
Next Meetina Date:
Thursday August 9, 2012 @ 9AM
PLEASE NOTE:
Should any interested party seek to appeal any decision of this Board with respect to any matter considered at such
meeting or hearing, s /he will need a record of the proceedings and for such purpose may need to ensure that a verbatim
record of the proceedings is made, which record includes the testimony and evidence upon which the appeal is to be
based.
In accordance with the Americans With Disabilities Act of 1990, persons needing a special accommodation to participate
in this meeting should contact the The Pension Resource Center, LLC no later than four days prior to the meeting.
FORM 1 STATEMENT OF 2011
Please print or type your name, mailing FINANCIAL INTERESTS
address, agency name, and position below:
LAST NAME -- FIRST NAME -- MIDDLE NAME: FOR OFFICE
USE ONLY:
MAILING ADDRESS :
ID Code
CITY : ZIP : COUNTY:
ID No.
NAME OF AGENCY:
Conf. Code
NAME OF OFFICE OR POSITION HELD OR SOUGHT: P. Req. Code
You are not limited to the space on the lines on this form. Attach additional sheets, if necessary.
CHECK ONLY IF ❑ CANDIDATE OR ❑ NEW EMPLOYEE OR APPOINTEE
* * ** BOTH PARTS OF THIS SECTION MUST BE COMPLETED * * **
DISCLOSURE PERIOD:
THIS STATEMENT REFLECTS YOUR FINANCIAL INTERESTS FOR THE PRECEDING TAX YEAR, WHETHER BASED ON A CALENDAR YEAR OR ON
A FISCAL YEAR. PLEASE STATE BELOW WHETHER THIS STATEMENT IS FOR THE PRECEDING TAX YEAR ENDING EITHER (must check one):
❑ DECEMBER 31, 2011 OR ❑ SPECIFY TAX YEAR IF OTHER THAN THE CALENDAR YEAR:
MANNER OF CALCULATING REPORTABLE INTERESTS:
THE LEGISLATURE ALLOWS FILERS THE OPTION OF USING REPORTING THRESHOLDS THAT ARE ABSOLUTE DOLLAR VALUES, WHICH
REQUIRES FEWER CALCULATIONS, OR USING COMPARATIVE THRESHOLDS, WHICH ARE USUALLY BASED ON PERCENTAGE VALUES (see
instructions for further details). PLEASE STATE BELOW WHETHER THIS STATEMENT REFLECTS EITHER (must check one):
❑ COMPARATIVE PERCENTAGE THRESHOLDS OR ❑ DOLLAR VALUE THRESHOLDS
PART A -- PRIMARY SOURCES OF INCOME [Major sources of income to the reporting person - See instructions p. 4]
(If you have nothing to report, you must write "none" or "n /a ")
NAME OF SOURCE SOURCE'S DESCRIPTION OF THE SOURCE'S
OF INCOME ADDRESS PRINCIPAL BUSINESS ACTIVITY
PART B -- SECONDARY SOURCES OF INCOME
[Major customers, clients, and other sources of income to businesses owned by the reporting person - See instructions p. 4]
(If you have nothing to report , you must write "none" or "n /a ")
NAME OF NAME OF MAJOR SOURCES ADDRESS PRINCIPAL BUSINESS
BUSINESS ENTITY OF BUSINESS' INCOME OF SOURCE ACTIVITY OF SOURCE
PART C -- REAL PROPERTY [Land, buildings owned by the reporting person - See instructions p. 4]
(If you have nothing to report, you must write "none" or "n /a ")
FILING INSTRUCTIONS for
when and where to file this form
are located at the bottom of page 2.
INSTRUCTIONS on who must
file this form and how to fill it out
begin on page 3.
OTHER FORMS you may need
to file are described on page 6.
CE FORM 1 - Effective: January 1, 2012. Refer to Rule 34- 8.202(1), F.A.C. (Continued on reverse side) PAGE 1
PART D — INTANGIBLE PERSONAL PROPERTY [Stocks, bonds, certificates of deposit, etc. - See instructions p. 5]
(If you have nothing to report, you must write "none" or "n /a ")
TYPE OF INTANGIBLE
PART E — LIABILITIES [Major debts - See instructions p. 5]
(If you have nothing to report, you must write "none" or 'Wa ")
rra�•�I�.»y :�a.�rr.� :�
BUSINESS ENTITY TO WHICH THE PROPERTY RELATES
F-11 11110 : IRS"Yel as] : � : 11111 s] : t
PART F — INTERESTS IN SPECIFIED BUSINESSES [Ownership or positions in certain types of businesses - See instructions p. 5]
(If you have nothing to report, you must write "none" or'Wa ")
: 1�b91�1x. �9��rrr�' E: �i�: 1��9nI�X9��rrr� 'Efi��:1�b91�Ix.Y.9��rrr�'Ef�c3
NAME OF BUSINESS ENTITY
ADDRESS OF BUSINESS ENTITY
PRINCIPAL BUSINESS ACTIVITY
POSITION HELD WITH ENTITY
I OWN MORE THAN A 5%
INTEREST IN THE BUSINESS
NATURE OF MY
OWNERSHIP INTEREST
I IF ANY OF PARTS A THROUGH F ARE CONTINUED ON A SEPARATE SHEET, PLEASE CHECK HERE ❑ I
SIGNATURE (required
WHAT TO FILE:
After completing all parts of this form, including
sianina and dating it, send back only the first
sheet (pages 1 and 2) for filing.
If you have nothing to report in a particular
section, you must write "none" or "n /a" in that
section(s).
NOTE:
MULTIPLE FILING UNNECESSARY:
Generally, a person who has filed Form 1 for a
calendar or fiscal year is not required to file a
second Form 1 for the same year. However, a
candidate who previously filed Form 1 because of
another public position must at least file a copy of
his or her original Form 1 when qualifying.
DATE SIGNED (required
FILING INSTRUCTIONS:
WHERE TO FILE:
If you were mailed the form by the Commission
on Ethics or a County Supervisor of Elections for
your annual disclosure filing, return the form to
that location.
Local officers /employees file with the Supervisor
of Electionsof the county in which they permanently
reside. (If you do not permanently reside in
Florida, file with the Supervisor of the county
where your agency has its headquarters.)
State officers or specified state employees
file with the Commission on Ethics, P.O. Drawer
15709, Tallahassee, FL 32317 -5709; physical
address: 3600 Maclay Boulevard, South, Suite
201, Tallahassee, FL 32312.
Candidates file this form together with their
qualifying papers.
To determine what category your position falls
under, see the "Who Must File" Instructions on
page 3.
Facsimiles will not be accepted.
WHEN TO FILE:
Initially, each local officer /employee, state
officer, and specified state employee must
file within 30 days of the date of his or her
appointment or of the beginning of employment.
Appointeeswho must be confirmed by the Senate
must file prior to confirmation, even if that is less
than 30 days from the date of their appointment.
Candidates for publicly - elected local office must
file at the same time they file their qualifying
papers.
Thereafter, local officers /employees, state
officers, and specified state employees are
required to file by July 1 st following each calendar
year in which they hold their positions.
Finally, at the end of office or employment,
each local officer /employee, state officer, and
specified state employee is required to file a
final disclosure form (Form 1 F) within 60 days
of leaving office or employment. However, filing
a CE Form 1F (Final Statement of Financial
Interests) does not relieve the filer of filing a
CE Form 1 if he or she was in their position on
December 31. 2011.
CE FORM 1 - Effective: January 1, 2012. Refer to Rule 34 -8.202 (1), F.A.C. PAGE 2
INSTRUCTIONS FOR COMPLETING FORM 1
WHO MUST FILE FORM 1:
All persons who fall within the categories of "state officers," "local officers /employees," "specified state employees," as well as candidates for elective local office,
are required to file Form 1. Positions within these categories are listed below. Persons
required to file full financial disclosure (Form 6) and officers of the judicial
branch do not file Form 1 (see Form 6 for a list of persons who must file that form).
STATE OFFICERS include the following positions for state officials:
county or municipal pollution control director; county or municipal environ-
1) Elected public officials not serving in a political subdivision of the
mental control director; county or municipal administrator with power to grant
state and any person appointed to fill a vacancy in such office, unless
or deny a land development permit; chief of police; fire chief; municipal clerk;
required to file full disclosure on Form 6.
appointed district school superintendent; community college president; district
2) Appointed members of each board, commission, authority, or council
medical examiner; purchasing agent (regardless of title) having the authority
having statewide jurisdiction, excluding members of solely advisory bodies;
to make any purchase exceeding $20,000 for the local governmental unit.
but including judicial nominating commission members; Directors of the
5) Officers and employees of entities serving as chief administrative officer
Florida Black Business Investment Board, Enterprise Florida, Scripps Florida
of a political subdivision.
Funding Corporation, Workforce Florida, and Space Florida; Members of the
6) Members of governing boards of charter schools operated by a city or
Council on the Social Status of Black Men and Boys; and Governors and
other public entity.
senior managers of Citizens Property Insurance Corporation and Florida
SPECIFIED STATE EMPLOYEES include the following positions
Workers' Compensation Joint Underwriting Association.
for state employees:
3) The Commissioner of Education, members of the State Board of
1) Employees in the office of the Governor or of a Cabinet member who
Education, the Board of Governors, and the local Boards of Trustees and
are exempt from the Career Service System, excluding secretarial, clerical,
Presidents of state universities.
and similar positions.
LOCAL OFFICERS /EMPLOYEES include the following positions
2) The following positions in each state department, commission,
for officers and employees of local government:
board, or council: Secretary, Assistant or Deputy Secretary, Executive
1) Persons elected to office in any political subdivision (such as munici-
Director, Assistant or Deputy Executive Director, and anyone having the
palities, counties, and special districts) and any person appointed to fill a
power normally conferred upon such persons, regardless of title.
vacancy in such office, unless required to file full disclosure on Form 6.
3) The following positions in each state department or division: Director,
2) Appointed members of the following boards, councils, commissions,
Assistant or Deputy Director, Bureau Chief, Assistant Bureau Chief, and any
authorities, or other bodies of any county, municipality, school district, inde-
person having the power normally conferred upon such persons, regardless
pendent special district, or other political subdivision: the governing body
of title.
of the subdivision; a community college or junior college district board of
4) Assistant State Attorneys, Assistant Public Defenders, Public
trustees; a board having the power to enforce local code provisions; a board
Counsel, full -time state employees serving as counsel or assistant counsel
of adjustment; a planning or zoning board having the power to recommend,
to a state agency, administrative law judges, and hearing officers.
create, or modify land planning or zoning within the political subdivision,
5) The Superintendent or Director of a state mental health institute estab-
except for citizen advisory committees, technical coordinating committees,
lished for training and research in the mental health field, or any major state
and similar groups who only have the power to make recommendations to
institution or facility established for corrections, training, treatment, or reha-
planning or zoning boards; a pension board or retirement board empowered
bilitation.
to invest pension or retirement funds or to determine entitlement to or amount
6) State agency Business Managers, Finance and Accounting Directors,
of a pension or other retirement benefit.
Personnel Officers, Grant Coordinators, and purchasing agents (regardless
3) Any other appointed member of a local government board who is
of title) with power to make a purchase exceeding $20,000.
required to file a statement of financial interests by the appointing authority or
7) The following positions in legislative branch agencies: each employ -
the enabling legislation, ordinance, or resolution creating the board.
ee (other than those employed in maintenance, clerical, secretarial, or similar
4) Persons holding any of these positions in local government: Mayor;
positions and legislative assistants exempted by the presiding officer of their
county or city manager; chief administrative employee of a county, municipal-
house); and each employee of the Commission on Ethics.
ity, or other political subdivision; county or municipal attorney; chief county or
municipal building inspector; county or municipal water resources coordinator;
INSTRUCTIONS FOR COMPLETING FORM 1:
INTRODUCTORY INFORMATION (At Top of Form):
If your name, mailing address, public agency, and position are
already printed on the form, you do not need to provide this informa-
tion unless it should be changed. To change any of this information,
write the correct information on the form, then contact your agency's
financial disclosure coordinator. Your coordinator is identified in the
financial disclosure portal on the Commission on Ethics website:
www.ethics.state.fl.us.
NAME OF AGENCY. This should be the name of the governmental unit
which you serve or served, by which you are or were employed, or for
which you are a candidate. For example, "City of Tallahassee," "Leon
County," or "Department of Transportation."
OFFICE OR POSITION HELD OR SOUGHT- Use the title of the office
or position you hold, are seeking, or held during the disclosure period (in
some cases you may not hold that position now, but you still would be
required to file to disclose your interests during the last year you held that
position). For example, "City Council Member," "County Administrator,"
"Purchasing Agent," or "Bureau Chief." If you are a candidate for office or
are a new employee or appointee, check the appropriate box.
MAILING ADDRESS: If your home address appears on the form but you
prefer another address be shown, change the address as described above
If you are an active or former officer or employee listed in Section
119.071(4)(d), F.S., whose home address is exempt from disclosure,
the Commission is required to maintain the confidentiality of your home
address if you submit a written request for confidentiaM. Persons
listed in Section 119.071(4)(d), F.S., are encouraged to provide an address
other than their home address.
DISCLOSURE PERIOD: The tax year for most individuals is the calendar
year (January 1 through December 31). If that is the case for you, then
your financial interests should be reported for the calendar year 2011; just
check the box and you do not need to add any information in this part of
the form. However, if you file your IRS tax return based on a tax year that is
not the calendar year, you should specify the dates of your tax year in this
portion of the form and check the appropriate box. This is the time frame
or "disclosure period" for your report.
MANNER OF CALCULATING REPORTABLE INTERESTS: As noted in
this portion of the form, the Legislature has given filers the option of report-
ing based on either thresholds that are comparative (usually, based on
percentage values) or thresholds that are based on absolute dollar values.
The instructions on the following pages specifically describe the different
thresholds. Simply check the box that reflects the choice you have made.
You must use the type of threshold you have chosen for each part of the
form. In other words, if you choose to report based on absolute dollar
value thresholds, you cannot use a percentage threshold on any part of
the form.
(CONTINUED on page 4) �
CE FORM 1 - Effective:January 1, 2012. Refer to Rule 34- 8.202(1), F.A.C. PAGE 3
PART A - PRIMARY SOURCES OF INCOME
[Required by Sec. 112.3145(3)(a)1 or (b)1, Fla. Stat.]
Part A is intended to require the disclosure of your principal sources of
income during the disclosure period. You do not have to disclose the amount
of income received. The sources should be listed in descending order,
with the largest source first. Please list in this part of the form the name,
address, and principal business activity of each source of your income which
(depending on whether you have chosen to report based on percentage
thresholds or on dollar value thresholds) either:
exceeded five percent (5 %) of the gross income received by you in
your own name or by any other person for your benefit or use during the
disclosure period, or
exceeded $2,500.00 (of gross income received during the disclosure
period by you in your own name or by any other person for your use or
benefit).
You need not list your public salary received from serving in the
position(s) which requires you to file this form, but this amount should be
included when calculating your gross income for the disclosure period. The
income of your spouse need not be disclosed. However, if there is joint
income to you and your spouse from property held by the entireties (such as
interest or dividends from a bank account or stocks held by the entireties),
you should include all of that income when calculating your gross income and
disclose the source of that income if it exceeded the threshold.
"Gross income" means the same as it does for income tax purposes,
including all income from whatever source derived, such as compensation for
services, gross income from business, gains from property dealings, interest,
rents, dividends, pensions, social security, distributive share of partnership
gross income, and alimony, but not child support.
Examples:
— If you were employed by a company that manufactures computers
and received more than 5% of your gross income (salary, commissions,
etc.) from the company (or, alternatively, $2,500), then you should list
the name of the company, its address, and its principal business activity
(computer manufacturing).
— If you were a partner in a law firm and your distributive share of
partnership gross income exceeded 5% of your gross income (or,
alternatively, $2,500), then you should list the name of the firm, its
address, and its principal business activity (practice of law).
— If you were the sole proprietor of a retail gift business and your gross
income from the business exceeded 5% of your total gross income (or,
alternatively, $2,500), then you should list the name of the business, its
address, and its principal business activity (retail gift sales).
— If you received income from investments in stocks and bonds, you
are required to list only each individual company from which you derived
more than 5% of your gross income (or, alternatively, $2,500), rather
than aggregating all of your investment income.
— If more than 5% of your gross income (or, alternatively, $2,500)
was gain from the sale of property (not just the selling price), then
you should list as a source of income the name of the purchaser, the
purchaser's address, and the purchaser's principal business activity. If
the purchaser's identity is unknown, such as where securities listed on
an exchange are sold through a brokerage firm, the source of income
should be listed simply as "sale of (name of company) stock," for
example.
— If more than 5% of your gross income (or, alternatively, $2,500)
was in the form of interest from one particular financial institution
(aggregating interest from all CD's, accounts, etc., at that institution),
list the name of the institution, its address, and its principal business
activity.
PART B - SECONDARY SOURCES OF INCOME
[Required by Sec. 112.3145(3)(a)2 or (b)2, Fla. Stat.]
This part is intended to require the disclosure of major customers,
clients, and other sources of income to businesses in which you own an
interest. You will not have anything to report unless:
(a) If you are reporting based on percentage thresholds:
CF F1RNA 1 - Fff —five 1--ry 1 9(199 Refer to Rule M -A 9f19H1 F A C
(1) You owned (either directly or indirectly in the form of an
equitable or beneficial interest) during the disclosure period more
than five percent (5 %) of the total assets or capital stock of a
business entity (a corporation, partnership, limited partnership,
proprietorship, joint venture, trust, firm, etc., doing business in
Florida); and
(2) You received more than ten percent (10 %) of your gross income
during the disclosure period from that business entity; and
(3) You received more than $1,500 in gross income from that
business entity during the period.
(b) If you are reporting based on dollar value thresholds:
(1) You owned (either directly or indirectly in the form of an
equitable or beneficial interest) during the disclosure period more
than five percent (5 %) of the total assets or capital stock of a
business entity (a corporation, partnership, limited partnership,
proprietorship, joint venture, trust, firm, etc., doing business in
Florida); and
(2) You received more than $5,000 of your gross income during
the disclosure period from that business entity.
If your interests and gross income exceeded the appropriate thresholds listed
above, then for that business entity you must list every source of income to
the business entity which exceeded ten percent (10 %) of the business entity's
gross income (computed on the basis of the business entity's most recently
completed fiscal year), the source's address, and the source's principal
business activity.
Examples:
— You are the sole proprietor of a dry cleaning business, from which
you received more than 10% of your gross income (an amount that was
more than $1,500) (or, alternatively, more than $5,000, if you are using
dollar value thresholds). If only one customer, a uniform rental company,
provided more than 10% of your dry cleaning business, you must list
the name of the uniform rental company, its address, and its principal
business activity (uniform rentals).
— You are a 20% partner in a partnership that owns a shopping mall
and your partnership income exceeded the thresholds listed above. You
should list each tenant of the mall that provided more than 10% of the
partnership's gross income, the tenant's address and principal business
activity.
— You own an orange grove and sell all your oranges to one marketing
cooperative. You should list the cooperative, its address, and its principal
business activity if your income met the thresholds.
PART C - REAL PROPERTY
[Required by Sec. 112.3145(3)(a)3 or (b)3, Fla. Stat.]
In this part, please list the location or description of all real property (land
and buildings) in Florida in which you owned directly or indirectly at any time
during the previous tax year in excess of five percent (5 %) of the property's
value. This threshold is the same, whether you are using percentage
thresholds or dollar thresholds. You are not required to list your residences
and vacation homes; nor are you required to state the value of the property
on the form.
Indirect ownership includes situations where you are a beneficiary of
a trust that owns the property, as well as situations where you are more
than a 5% partner in a partnership or stockholder in a corporation that owns
the property. The value of the property may be determined by the most
recently assessed value for tax purposes, in the absence of a more current
appraisal.
The location or description of the property should be sufficient to
enable anyone who looks at the form to identify the property. Although a
legal description of the property will do, such a lengthy description is not
required. Using simpler descriptions, such as "duplex, 115 Terrace Avenue,
Tallahassee" or 40 acres located at the intersection of Hwy. 60 and 1 -95, Lake
County" is sufficient. In some cases, the property tax identification number of
the property will help in identifying it: 120 acre ranch on Hwy. 902, Hendry
County, Tax ID # 131 - 45863."
(CONTINUED on page 5) :ZF-
Examples:
— You own 1/3 of a partnership or small corporation that owns both a
vacant lot and a 12% interest in an office building. You should disclose
the lot, but are not required to disclose the office building (because your
1/3 of the 12% interest —which equals 4% —does not exceed the 5%
threshold).
— If you are a beneficiary of a trust that owns real property and your
interest depends on the duration of an individual's life, the value of your
interest should be determined by applying the appropriate actuarial table
to the value of the property itself, regardless of the actual yield of the
property.
PART D - INTANGIBLE PERSONAL PROPERTY
[Required by Sec. 112.3145(3)(a)3 or (b)3, Fla. Stat.]
Provide a general description of any intangible personal property that, at
any time during the disclosure period, was worth more than:
(1) ten percent (10 %) of your total assets (if you are using percentage
thresholds), or
(2) $10,000 (if you are using dollar value thresholds),
and state the business entity to which the property related. Intangible per-
sonal property includes such things as money, stocks, bonds, certificates of
deposit, interests in partnerships, beneficial interests in a trust, promissory
notes owed to you, accounts receivable by you, assets held in IRA's, and
bank accounts. Such things as automobiles, houses, jewelry, and paintings
are not intangible property. Intangibles relating to the same business entity
should be aggregated; for example, two certificates of deposit and a savings
account with the same bank. Where property is owned by husband and wife
as tenants by the entirety (which usually will be the case), the property should
be valued at 100 %.
Calculations: In order to decide whether the intangible property exceeds
10% of your total assets, you will need to total the value of all of your assets
(including real property, intangible property, and tangible personal property
such as automobiles, jewelry, furniture, etc.). When making this calculation,
do not subtract any liabilities (debts) that may relate to the property —add
only the fair market value of the property. Multiply the total figure by 10% to
arrive at the disclosure threshold. List only the intangibles that exceed this
threshold amount. Jointly owned property should be valued according to the
percentage of your joint ownership, with the exception of property owned by
husband and wife as tenants by the entirety, which should be valued at 100 %.
None of your calculations or the value of the property have to be disclosed on
the form. If you are using dollar value thresholds, you do not need to make
any of these calculations.
Examples for persons using comparative (percentage) thresholds
— You own 50% of the stock of a small corporation that is worth
$100,000, according to generally accepted methods of valuing small
businesses. The estimated fair market value of your home and other
property (bank accounts, automobile, furniture, etc.) is $200,000. As
your total assets are worth $250,000, you must disclose intangibles
worth over $25,000. Since the value of the stock exceeds this threshold,
you should list "stock" and the name of the corporation. If your accounts
with a particular bank exceed $25,000, you should list "bank accounts"
and bank's name.
— When you retired, your professional firm bought out your partner-
ship interest by giving you a promissory note, the present value of
which is $100,000. You also have a certificate of deposit from a bank
worth $75,000 and an investment portfolio worth $300,000, consisting
of $100,000 of IBM bonds and a variety of other investments worth
between $5,000 and $50,000 each. The fair market value of your
remaining assets (condominium, automobile, and other personal prop-
erty) is $225,000. Since your total assets are worth $700,000, you must
list each intangible worth more than $70,000. Therefore, you would list
"promissory note" and the name of your former partnership, "certificate
of deposit" and the name of the bank, "bonds" and "IBM," but none of
the rest of your investments.
PART E - LIABILITIES
[Required by Sec. 112.3145(3)(a)4 or (b)4, Fla. Stat.]
In this part of the form, list the name and address of each private or
governmental creditor to whom you were indebted for a liability in any amount
that, at any time during the disclosure period, exceeded:
(1) your net worth (if you are using percentage thresholds), or
(2) $10,000 (if you are using dollar value thresholds).
You are not required to list the amount of any indebtedness or your net
worth. You do not have to disclose any of the following: credit card and retail
installment accounts, taxes owed (unless reduced to a judgment), indebted-
ness on a life insurance policy owed to the company of issuance, contingent
liabilities, and accrued income taxes on net unrealized appreciation (an
accounting concept). A "contingent liability" is one that will become an actual
liability only when one or more future events occur or fail to occur, such as
where you are liable only as a guarantor, surety, or endorser on a promissory
note. If you are a "co- maker" and have signed as being jointly liable or jointly
and severally liable, then this is not a contingent liability; if you are using the
$10,000 threshold and the total amount of the debt (not just the percentage
of your liability) exceeds $10,000, such debts should be reported.
Calculations for persons using comparative (percentage) thresholds: In
order to decide whether the debt exceeds your net worth, you will need to
total all of your liabilities (including promissory notes, mortgages, credit card
debts, lines of credit, judgments against you, etc.). Subtract this amount from
the value of all your assets as calculated above for Part D. This is your "net
worth." You must list on the form each creditor to whom your debt exceeded
this amount unless it is one of the types of indebtedness listed in the para-
graph above (credit card and retail installment accounts, etc.). Joint liabilities
with others for which you are "jointly and severally liable," meaning that you
may be liable for either your part or the whole of the obligation, should be
included in your calculations based upon your percentage of liability, with
the following exception: joint and several liability with your spouse for a debt
which relates to property owned by both of you as "tenants by the entirety"
(usually the case) should be included in your calculations by valuing the asset
at 100% of its value and the liability at 100% of the amount owed.
Examples for persons using comparative (percentage) thresholds
— You owe $15,000 to a bank for student loans, $5,000 for credit
card debts, and $60,000 (with your spouse) to a savings and loan for a
home mortgage. Your home (owned by you and your spouse) is worth
$80,000 and your other property is worth $20,000. Since your net worth
is $20,000 ($100,000 minus $80,000), you must report only the name
and address of the savings and loan.
— You and your 50% business partner have a $100,000 business loan
from a bank, for which you both are jointly and severally liable. The
value of the business, taking into account the loan as a liability of the
business, is $50,000. Your other assets are worth $25,000, and you
owe $5,000 on a credit card. Your total assets will be $50,000 (half of
a business worth $50,000 plus $25,000 of other assets). Your liabilities,
for purposes of calculating your net worth, will be only $5,000, because
the full amount of the business loan already was included in valuing the
business. Therefore, your net worth is $45,000. Since your 50% share
of the $100,000 business loan exceeds this net worth figure, you must
list the bank.
PART F - INTERESTS IN SPECIFIED
BUSINESSES
[Required by Sec. 112.3145(5), Fla. Stat.]
The types of businesses covered in this disclosure are only: state and
federally chartered banks; state and federal savings and loan associations;
cemetery companies; insurance companies (including insurance agencies);
mortgage companies; credit unions; small loan companies; alcoholic bever-
age licensees; pari - mutuel wagering companies, utility companies, entities
controlled by the Public Service Commission; and entities granted a franchise
to operate by either a city or a county government.
(CONTINUED on page 6) �
CE FORM 1 - Effective:January 1, 2012. Refer to Rule 34- 8.202(1), F.A.C. PAGE 5
You are required to disclose in this part of the form the fact that you
owned during the disclosure period an interest in, or held any of certain posi-
tions with, particular types of businesses listed above. You are required to
make this disclosure if you own or owned (either directly or indirectly in the
form of an equitable or beneficial interest) at any time during the disclosure
period more than five percent (5 %) of the total assets or capital stock of one
of the types of business entities granted a privilege to operate in Florida that
are listed above. You also must complete this part of the form for each of
these types of businesses for which you are, or were at any time during the
disclosure period, an officer, director, partner, proprietor, or agent (other than
a resident agent solely for service of process).
If you have or held such a position or ownership interest in one of these
types of businesses, list (vertically for each business): the name of the busi-
ness, its address and principal business activity, and the position held with
the business (if any). Also, if you own(ed) more than a 5% interest in the
business, as described above, you must indicate that fact and describe the
nature of your interest.
(End of Instructions.)
PENALTIES
A failure to make any required disclosure constitutes grounds for and may be punished by one or more of the following: dis-
qualification from being on the ballot, impeachment, removal or suspension from office or employment, demotion, reduction in
salary, reprimand, or a civil penalty not exceeding $10,000. [Sec. 112.317, Florida Statutes]
Also, if the annual form is not filed by September 1st, a fine of $25 for each day late will be imposed, up to a maximum
penalty of $1,500. [Section 112.3145, F.S. ].
OTHER FORMS YOU MAY NEED TO FILE
IN ORDER TO COMPLY WITH THE ETHICS LAWS
In addition to filing Form 1, you may be required to file one or more of the special purpose forms listed below, depending on your particular position,
business activities, or interests. As it is your duty to obtain and file any of the special purpose forms which may be applicable to you, you should carefully
read the brief description of each form to determine whether it applies.
Form 1 F — Final Statement of Financial
Interests: Required of local officers, state officers, and speci-
fied state employees within 60 days after leaving office or employment.
This form is used to report financial interests between January 1st of the
last year of office or employment and the last day of office or employ-
ment. [Sec. 112.3145(2)(b), Fla. Stat.]
Form 1X — Amended Statement of Financial
Interests: To be used by local officers, state officers, and speci-
fied state employees to correct mistakes on previously filed Form 1's.
[Sec. 112.3145(9), Fla. Stat.]
Form 2 — Quarterly Client Disclosure: Required
of local officers, state officers, and specified state employees to
disclose the names of clients represented for compensation by them-
selves or a partner or associate before agencies at the same level of
government as they serve. The form should be filed by the end of the
calendar quarter (March 31, June 30, Sept. 30, Dec. 31) following the
calendar quarter in which a reportable representation was made. [Sec.
112.3145(4), Fla. Stat.]
Form 3A — Statement of Interest in Competitive
Bid for Public Business: Required of public officers and
public employees prior to or at the time of submission of a bid for public
business which otherwise would violate Sec. 112.313(3) or 112.313(7),
Fla. Stat. [Sec . 112.313(12)(b), Fla. Stat.]
Form 4A — Disclosure of Business Transaction,
Relationship, or Interest: Required of public officers and
employees to disclose certain business transactions, relationships, or
interests which otherwise would violate Sec. 112.313(3) or 112.313(7),
Fla. Stat. [Sec. 112.313(12) and (12)(e), Fla. Stat.]
Form 8A — Memorandum of Voting Conflict for
State Officers: Required to be filed by a state officer within 15
days after having voted on a measure which inured to his or her special
private gain (or loss) or to the special gain (or loss) of a relative, busi-
ness associate, or one by whom he or she is retained or employed. Each
appointed state officer who seeks to influence the decision on such a
measure prior to the meeting must file the form before undertaking that
action. [Sec. 112.3143, Fla. Stat.]
Form 8B — Memorandum of Voting Conflict for
County, Municipal, and Other local Public
Officers: Required to be filed (within 15 days of abstention) by
each local officer who must abstain from voting on a measure which
would inure to his or her special private gain (or loss) or the special gain
(or loss) of a relative, business associate, or one by whom he or she is
retained or employed. Each appointed local official who seeks to influ-
ence the decision on such a measure prior to the meeting must file the
form before undertaking that action. [Sec. 112.3143, Fla. Stat.]
Form 9 — Quarterly Gift Disclosure: Required of
local officers, state officers, specified state employees, and state
procurement employees to report gifts over $100 in value. The form
should be filed by the end of the calendar quarter (March 31, June 30,
September 30, or December 31) following the calendar quarter in which
the gift was received. [Sec. 112.3148, Fla. Stat.]
Form 10 — Annual Disclosure of Gifts from
Governmental Entities and Direct Support
Organizations and Honorarium Event Related
Expenses: Required of local officers, state officers, specified
state employees, and state procurement employees to report gifts
over $100 in value received from certain agencies and direct support
organizations; also to be utilized by these persons to report honorarium
event - related expenses paid by certain persons and entities.The form
should be filed by July 1 following the calendar year in which the gift or
honorarium event - related expense was received. [Sec. 112.3148 and
112.3149, Fla. Stat.]
AVAILABILITY OF FORMS; FOR MORE INFORMATION
Copies of these forms are available from the Supervisor of Elections
in your county; from the Commission on Ethics, Post Office Drawer
15709, Tallahassee, Florida 32317 -5709; telephone (850) 488 -7864;
and at the Commission's web site: www.ethics.state.fl.us.
Questions about any of these forms or the ethics laws may be
addressed to the Commission on Ethics, Post Office Drawer 15709,
Tallahassee, Florida 32317 -5709; telephone (850) 488 -7864.
CE FORM 1 - Effective:January 1, 2012. Refer to Rule 34- 8.202(1), F.A.C. PAGE 6
THE LAW OFFICES OF
PERRY &JENSEN, LLC
ANN H. PERRY BONNI SPATARA JENSEN
aperry @perryjensenlaw.com MEMORANDUM bsjensen @perryjensenlaw.com
TO: Board of Trustees
PALM BEACH GARDENS POLICE OFFICERS' PENSION FUND
c
FROM: Bonni S. Jensen"'
Fund Legal Counsel,
DATE: May, 2012
RE: ANNUAL FORM 1 FILING
Attached is Commission on Ethics (CE) Form 1 "Statement of Financial Interests"
which must be filed by Trustees with the Supervisor of Elections for the county in which you
reside, prior to July 1, 2012. The instructions for filing and completing the form are also
attached. Please note that it is recommended that current or former law enforcement
officers and firefighters do not use their home addresses on the form; if you do not have
a post office box, you may use your work address.
You may also complete the form online using your keyboard to fill in the information,
tabbing from one section to the next. However, you must print the completed form, sign
and date it, then send it to the Supervisor of Elections for the county in which you
reside. There is no current system available to file online.
It is important that you timely file this form because the penalty for failure to timely
file is $25.00 per day, to a maximum of $1,500.00. 1 suggest that you file this form by
certified mail, return receipt requested, and keep a photo copy of the form for your files.
Several Trustees have had to show proof of filing in the past, so it is my practice to always
get a receipt for such documents.
As a reminder, the Florida Commission on Ethics last year issued an Ethics Opinion
regarding the proper reporting for intangible property under Part D of Form 1. The Opinion
letter addressed the reporting for six different types of intangible personal property as
follows:
Assets held in an Individual Retirement Account ( "IRA ") - The IRA account
itself is not considered intangible property. However each individual
investment in the IRA which exceeds the reporting threshold' should be
'The individual Form 1 filer chooses the reporting threshold: either "dollar value" or "percentage
threshold." For intangible personal property the dollar value threshold is $10,000 and the percentage
threshold is 10 %.
400 EXECUTIVE CENTER DRIVE, SUITE 207•:• WEST PALM BEACH, FLORIDA 33401 -2922
PH: 561.686.6550 e Fx: 561.686.2802
Board of Trustees
Annual Form 1 Filing
May, 2012
Page 2 of 2
reported. Mutual funds are considered one investment.
2. Assets held in a 401(k) - The 401(k) account itself is not considered
intangible property. However each individual investment in the 401(k) which
exceeds the reporting threshold should be reported. Mutual funds are
considered one investment.
3. Funds invested in the FRS Investment Plan - The FRS Investment Plan itself
is not considered intangible property. However each individual investment
in the FRS Investment Plan which exceeds the reporting threshold should be
reported. Mutual funds are considered one investment.
The opinion indicates that a Form 1 filer does not need to report as intangible
property the "investment" in the FRS Defined Benefit program. This same
logic would apply to local pension plans. The defined benefit program
"investment" does not need to be reported as intangible property, but a
defined contribution plan's investments would need to be reported.
4. Assets held in the Florida Pre -Paid College Plan - Both the Florida Pre -Paid
College Plan and the Florida College Investment Plan need to be reported
as intangible property if the values of the accounts exceed the individual
reporting threshold. For the Florida Pre -Paid College Plan, the threshold is
determined by looking to the balance in the account. For the Florida College
Investment Plan, only individual investments in excess of the threshold limits
need to be reported.
5. Assets held in a 457 Plan /Deferred Compensation Plan ( "457) - The 457
account itself is not considered intangible property. However each individual
investment in the 457 which exceeds the reporting threshold should be
reported. Mutual funds are considered one investment.
6. Assets in the Florida Deferred Retirement Option Program ( "DROP ") - The
DROP account itself is considered intangible property. This same analysis
would apply to a local DROP.
If you have any questions or if I may be of any assistance to you at all, please do
not hesitate to contact me or one of my assistants.
BSJ /Ig
E -Copy: Administrator
THE LAW OFFICES OF
PERRY &JENSEN, LLC
ANN H. PERRY
aperry@perryjensenlaw.com
MEMORANDUM
To: Board of Trustees
Palm Beach Gardens Police Officers' Pension Fund
From: Bonni S. Jensen
Subject: State and Tax Law Updates
Date: May, 2012
BONN] SPATARA JENSEN
bsjensen @perryjensenlaw.com
Both the IRS and the State legislature have taken actions which could impact your
pension plan. The IRS has issued a private letter ruling on Retire /Rehire policies and is
addressing the Normal Retirement Age issue again. And the State legislature, in addition
to the change in the public records law, passed a bill to automatically cancel the
designation of the spouse as a beneficiary upon divorce or annulment of the marriage.
INTERNAL REVENUE CODE ISSUES
In a Private Letter Ruling ( "PLR ") published November 25, 2011, the IRS determined
that if an employee "retires" in order to qualify for a benefit, with the explicit understanding
with the employer that the employee is not separating from service, then the employee is
not legitimately retired. The IRS ruled this in a case involving certain early retirement
subsidies that were being eliminated and so many employees "retired" to take advantage
of the benefits. The employer allowed the employees to do so and then rehired them into
their same position the next day. According to the PLR, such retirements violate Internal
Revenue Code §401(a) and could result in disqualification or penalties to a plan.
PLAN OF ACTION: Ensure that retirements are in compliance with this PLR or
implement changes to the Pension Plans in accordance with
the in- service distribution regulations discussed below.
The Retire /Rehire issue is related to the IRS's ongoing review of Normal Retirement
Age in the governmental sector, which the IRS is still actively considering. Notice 2012 -29
was released in April of 2012 inviting public comment on:
(A) The IRS clarification that governmental plans which do not offer in- service
400 EXECUTIVE CENTER DRIVE, SUITE 207•: WEST PALM BEACH, FLORIDA 33401 -2922
PH: 561.686.6550 •: Fx: 561.686.2802
r- „4Qa'�p 13
Board of Trustees
Palm Beach Gardens Police Officers' Pension Fund
State and Tax Law Updates
May, 2012
Page 2 of 4
distributions do not need to have a definition of normal retirement age and
do not need to have a definition referencing specifically age; and
(B) Allows the age 50 safe harbor for in- service distributions to public safety
officers who participate in larger plans whose members are not all public
safety officers and who do not all have a normal retirement age of 50.
Importantly, the effective date for the application of this regulation has been
extended until the later of January 1, 2015 or the close of the first regular legislative
session of the body with the authority to amend the plan.
PLAN OF ACTION:
• Continue to monitor effective date for governmental plans
• Discussion with Board regarding comments on the Regulation
STATE LAW
At the end of April, the Governor signed HB 401 into law. The law effective July 1,
2012 provides that dissolution or annulment of marriage voids the election of a former
spouse as a designated beneficiary. Though this is not specifically a pension issue, it does
impact the operations of the Pension Fund and needs to be addressed as a part of the
Board processes. Additionally, the City should be made aware of the change.
The bill amends the Florida Statutes by creating a new §732.703. This section voids
the designation of the spouse as the death beneficiary/joint annuitant ( "beneficiary") as of
the date of divorce. This law applies to:
1. Employee benefit plans (except the Florida Retirement System);
2. Life insurance policies or annuities within an employee;
3. IRAs;
4. Payable on death accounts;
5. Security accounts registered in a transfer on death form; or
6. Life insurance policies or annuities held outside an employee benefit plan.
And does not apply:
1. To the extent federal law provides otherwise;
2. If the designation of beneficiary is signed after the dissolution or annulment
and expressly provides that benefit will be paid to the former spouse;
3. To a will or trust;
Board of Trustees
Palm Beach Gardens Police Officers' Pension Fund
State and Tax Law Updates
May, 2012
Page 3 of 4
4. If the order of dissolution or annulment requires the former spouse to remain
the beneficiary;
5. If under the order of dissolution or annulment the decedent could not have
unilaterally terminated the ownership of the asset;
6. If the designation of the spouse as beneficiary is irrevocable;
7. If the instrument directing the disposition of the assets is governed by the
laws of another state;
8. To an asset in two or more names where the death of one co -owner vests
ownership in the survivor;
9. If the decedent remarries the former spouse; or
10. To state administered retirement plans.
The law also provides for some limitation on liability for improper payments under
the law, unless the employee benefit plan pays in violation of an order directed to the
employee benefit plan and served as required by law.
1. The employee benefit plan is not liable for making a payment in violation of
the new statute (FS 732.703) if the beneficiary designation does not explicitly
specify the relationship.
2. If the designation of beneficiary clearly identifies the beneficiary as the
former spouse, then the employee benefit fund has no liability for paying the
former spouse if the death certificate identifies the participant as married to
that spouse at the time of his or her death. Alternatively, if the designation
of beneficiary clearly identifies the beneficiary as the former spouse, then the
employee benefit fund has no liability for paying the secondary beneficiary
if the death certificate identifies the participant as not married or is married
to another person at the time of his or her death.
3. If the death certificate is silent as to the decedent's marital status at the time
of death, then the employee benefit fund is not liable for making the payment
to the spouse as the primary beneficiary if the primary beneficiary/spouse
completes an affidavit swearing or affirming that the parties were legally
married to each other on the date of death. Alternatively, if the death
certificate is silent as to the decedent's marital status at the time of death,
then the employee benefit fund is not liable for making the payment to the
secondary beneficiary if the secondary beneficiary completes an affidavit
swearing or affirming that the primary beneficiary and the decedent were not
legally married to each other on the date of death. See attached draft
Affidavits. The verbiage of the affidavits is set forth in the new law.
Board of Trustees
Palm Beach Gardens Police Officers' Pension Fund
State and Tax Law Updates
May, 2012
Page 4 of 4
The limitations on liability apply even though the employee benefit fund may have
known that the person to whom the asset is transferred is different from the person who
owns the asset per the designation of beneficiary or the person who would own it if the
designation were void by operation of the new law.
The new law does not affect the ownership of interests in assets between the former
spouse and any other person who may own it by operation of the new law, including the
rights of any purchaser, creditor, insurance company, financial institutions, trustee,
administrator or other third party.
This law applies to all deaths occurring on or after July 1, 2012 regardless of when
the designation was made.
PLAN OF ACTION:
• Renew efforts to make sure that all beneficiary designations are up to date.
• Implement use of affidavits for payment of all death benefits effective July 1,
2012.
• Develop procedures for gathering records to determine participant's marital
status on date of death.
• Ensure that the City and all service providers are aware of the new law.
• Follow up on regulation interpreting the statute, if any.
Please add these items to your next meeting agenda for discussion.
H:WII Miscellaneous\ALL BOARDS\2012 \MEMO state law and IRS (All Funds).wpd
PENSION FUND
AFFIDAVIT
STATE OF
COUNTY OF
Before me, the undersigned authority, personally appeared (type or print affiant's
name) ( "Affiant "), who swore or affirmed that:
1. (Type or print name of decedent) ( "Decedent ") died on (type or print the date
of the Decedent's death)
2. Affiant is a "primary beneficiary" as that term is defined in Section 732.703,
Florida Statutes. Affiant and Decedent were married on (type or print the
date of marriage), and were legally married to one another on the date of the
Decedent's death.
(Affiant)
Sworn to or affirmed before me by the affiant who is personally known to me or who
has produced as identification this day of
12012.
Signature of Officer
Signature, Notary Public
In accordance with the provisions of Florida Statutes,
§117.04(4)(1), Notary name must printed, typed or
stamped below Notary's signature; seal must be stamped
next to signature or below printed name:
Printed, typed or stamped name of Notary
BSJ /lg
H:WII Miscellaneous \FORMS\Affidavits.wpd
PENSION FUND
AFFIDAVIT
STATE OF
COUNTY OF
Before me, the undersigned authority, personally appeared (type or print affiant's
name) ( "Affiant "), who swore or affirmed that:
1. (Type or print name of decedent) ( "Decedent ") died on (type or print the date
of the Decedent's death)
2. Affiant is a "secondary beneficiary" as that term is defined in Section
732.703, Florida Statutes. On the date of the Decedent's death, the
Decedent was not legally married to the spouse designated as the "primary
beneficiary" as that term is defined in Section 732.703, Florida Statutes.
Sworn to or affirmed before me by the affiant who is personally known to me or who
has produced
, 2012.
BSJ /lg
HAA11 Miscellaneous \FORMS1Afridavits.wpd
as identification this day of
Signature of Officer
Signature, Notary Public
In accordance with the provisions of Florida Statutes,
§117.04(4)(1), Notary name must printed, typed or
stamped below Notary's signature; seal must be stamped
next to signature or below printed name:
Printed, typed or stamped name of Notary
G'C Gabriel Roeder Smith & Company
0 Consultants & Actuaries
CITY OF PALM BEACH GARDENS POLICE OFFICERS' PENSION FUND
ACTUARIAL VALUATION REPORT AS OF OCTOBER 1, 2011
ANNUAL EMPLOYER CONTRIBUTION FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 2013
GRS
RS Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1616 phone
Consultants & Actuaries Suite 505 954.525.0083 fax
Ft. Lauderdale, FL 33301 -1804 www.gabrielroeder.com
May 8, 2012
Board of Trustees
City of Palm Beach Gardens
Police Officers Pension Fund
Palm Beach Gardens, Florida
Dear Board Members:
The results of the October 1, 2011 Annual Actuarial Valuation of the City of Palm Beach Gardens Police
Officers' Pension Fund are presented in this report.
This report was prepared at the request of the Board and is intended for use by the Retirement System
and those designated or approved by the Board. This report may be provided to parties other than the
System only in its entirety and only with the permission of the Board.
The purpose of the valuation is to measure the System's funding progress, to determine the employer
contribution rate for the fiscal year ending September 30, 2013, and to determine the actuarial
information for Governmental Accounting Standards Board (GASB) Statement No. 25 and No. 27.
This report should not be relied on for any purpose other than the purpose described above.
The findings in this report are based on data or other information through September 30, 2011. Future
actuarial measurements may differ significantly from the current measurements presented in this report
due to such factors as the following: plan experience differing from that anticipated by the economic or
demographic assumptions; changes in economic or demographic assumptions; increases or decreases
expected as part of the natural operation of the methodology used for these measurements (such as the
end of an amortization period or additional cost or contribution requirements based on the plan's funded
status); and changes in plan provisions or applicable law.
The valuation was based upon information furnished by the Plan Administrator concerning Retirement
Plan benefits, financial transactions, plan provisions and active members, terminated members, retirees
and beneficiaries. We checked for internal and year -to -year consistency, but did not otherwise audit the
data. We are not responsible for the accuracy or completeness of the information provided by the Plan
Administrator.
This report was prepared using certain assumptions prescribed by the Board as described in Section B.
The undersigned actuaries are members of the American Academy of Actuaries and meet the
Qualification Standards of the American Academy of Actuaries to render the actuarial opinions
contained herein. The signing actuaries are independent of the plan sponsor.
This report has been prepared by actuaries who have substantial experience valuing public employee
retirement systems. To the best of our knowledge the information contained in this report is accurate and
fairly presents the actuarial position of the Retirement Plan as of the valuation date. All calculations
have been made in conformity with generally accepted actuarial principles and practices, with the
Actuarial Standards of Practice issued by the Actuarial Standards Board and with applicable statutes.
This actuarial valuation and/or cost determination was prepared and completed by me or under my direct
supervision, and I acknowledge responsibility for the results. To the best of my knowledge, the results are
complete and accurate. In my opinion, the techniques and assumptions used are reasonable, meet the
requirements and intent of Part VII, Chapter 112, Florida Statutes, and are based on generally accepted
actuarial principles and practices. There is no benefit or expense to be provided by the plan and/or paid
from the plan's assets for which liabilities or current costs have not been established or otherwise taken into
account in the valuation. All known events or trends which may require a material increase in plan costs or
required contribution rates have been taken into account in the valuation.
Respectfully submitted,
GABRIEL, ROEDER, SMITH AND COMPANY
By `
JAtephJn Palmquist, ASA, AAA, FCA
Enrolled Actuary No. 11 -1560
By 1
Melissa R. Algayer, MAAA, FCA
Enrolled Actuary No. 11 -6467
Gabriel Roeder Smith & Company
TABLE OF CONTENTS
Section
Title
Page
A
Discussion of Valuation Results
1. Discussion of Valuation Results
1
2. Chapter Revenue
5
B
Valuation Results
1. Participant Data
6
2. Annual Required Contribution
7
3. Actuarial Value of Benefits and Assets
8
4. Calculation of Employer Normal Cost
9
5. Liquidation of Unfunded Actuarial Accrued
Liability
10
6. Actuarial Gains and Losses
12
7. Recent History of Required and Actual
Contributions
17
8. Actuarial Assumptions and Cost Method
18
9. Glossary of Terms
22
C
Pension Fund Information
1. Statement of Plan Assets at Market Value
25
2. Reconciliation of Plan Assets
26
3. Reconciliation of DROP Accounts
27
4. Calculation of Actuarial Value of Assets
28
5. Investment Rate of Return
29
D
Financial Accounting Information
1. FASB No. 35
30
2. GASB No. 25
31
3. GASB No. 27
33
E Miscellaneous Information
1. Reconciliation of Membership Data 35
2. Active Participant Distribution 36
3. Inactive Participant Distribution 37
F Summary of Plan Provisions 38
"]NO
SECTION A
DISCUSSION OF VALUATION RESULTS
GRS
I
DISCUSSION OF VALUATION RESULTS
Comparison of Required Emplover Contributions
A comparison of the required employer contribution developed in this year's actuarial valuation and
the previous valuation is as follows.
The required contribution dollar amounts shown above are estimates only. The actual contribution
should be no less than the percentage of the actual payroll for the fiscal year. The required employer
contribution has been adjusted for interest on the basis that contributions are made in equal payments at the
end of each quarter.
The contribution has also been computed under the assumption that the amount to be received from
the State on behalf of police officers in 2013 will be the same as the base amount of $412,644. If the actual
payment from the State falls below this amount, then the City must increase its contribution by the
difference.
Actual employer and allowable State contributions during the year ending September 30, 2011 were
$3,885,572 and $412,644, respectively, for a total of $4,298,216. The annual required contribution was
$4,298,216.
GRS
For FYE 9/30/2013
For FYE 9/30/2012
Based on
Based on
10/1/2011
10/1/2010
Increase
Valuation
Valuation
(Decrease)
Required Employer /State Contribution
$ 4,132,744
$ 4,198,183
$ (65,439)
As % of Covered Payroll
56.46 %
47.04 %
9.42 %
Allowable Credit for State Contribution
$ 412,644
$ 412,644
$ 0
As % of Covered Payroll
5.64 %
4.62 %
1.02 %
Required Employer Contribution
$ 3,720,100
$ 3,785,539
$ (65,439)
As % of Covered Payroll
50.82 %
42.42 %
8.40 %
The required contribution dollar amounts shown above are estimates only. The actual contribution
should be no less than the percentage of the actual payroll for the fiscal year. The required employer
contribution has been adjusted for interest on the basis that contributions are made in equal payments at the
end of each quarter.
The contribution has also been computed under the assumption that the amount to be received from
the State on behalf of police officers in 2013 will be the same as the base amount of $412,644. If the actual
payment from the State falls below this amount, then the City must increase its contribution by the
difference.
Actual employer and allowable State contributions during the year ending September 30, 2011 were
$3,885,572 and $412,644, respectively, for a total of $4,298,216. The annual required contribution was
$4,298,216.
GRS
2
Revisions in Benefits
There have been no changes in benefits since the prior valuation.
Revisions in Actuarial Assumptions or Methods
The investment return assumption was lowered from 7.5% to 7.4 %. This rate will continue to be
lowered by 0.1% each year until 6.5% is reached. There have been no other changes in assumptions or
methods since the prior valuation.
The Actuarial Standard of Practice (ASOP) with regard to the mortality assumption has recently
been revised. ASOP No. 35 Disclosure Section 4.1.1 now states "The disclosure of the mortality
assumption should contain sufficient detail to permit another qualified actuary to understand the provision
made for future mortality improvement. If the actuary assumes zero mortality improvement after the
measurement date, the actuary should state that no provision was made for future mortality improvement. "
The mortality assumption currently reflects future mortality improvements. Detail on this assumption can
be found in the Actuarial Assumptions and Cost Method section.
Actuarial Experience
There was a net actuarial gain of $718,288 for the year which means that actual experience was
more favorable than expected. The gain is primarily due to lower than expected salary increases. The
gain was partially offset by losses due to recognized investment return below the assumed rate of 7.5 %.
The investment return was (0.4)% based on market value of assets and 4.6% based on actuarial value of
assets. The net actuarial gain has decreased the required employer contribution by 0.92% of covered
payroll.
Funded Ratio
This year's funded ratio is 60.5% compared to 58.8% last year. The funded ratio was 61.2% before
the change in the investment return assumption. The ratio is equal to the actuarial value of assets divided by
the actuarial accrued (past service) liability.
GRS
Analysis of Change in Employer Contribution
The components of change in the employer contribution rate are as follows:
Contribution rate last year
Change in assumptions
Payment on unfunded liability
Experience (gain) /loss
Change in Normal Cost Rate
Change in administrative expense
Change in State revenue
Contribution rate this year
Variability of Future Contribution Rates
42.42 %
1.47
9.23
(0.92)
(0.86)
0.50
1.02
50.82
3
The Actuarial Cost Method used to determine the contribution rate is intended to produce
contribution rates which are generally level as a percent of payroll. Even so, when experience differs
from the assumptions, as it often does, the employer's contribution rate can vary significantly from year-
to -year.
Over time, if the year -to -year gains and losses offset each other, the contribution rate would be
expected to return to the current level, but this does not always happen.
The Actuarial Value of Assets exceeds the Market Value of Assets by $5,330,254 as of the
valuation date (see Section Q. This difference will be gradually recognized in the absence of offsetting
gains. In turn, the computed employer contribution rate will increase by approximately 6.8% of covered
payroll.
Another potential area of variability has to do with the annual payment on the unfunded accrued
liability (UAL). This payment is computed as a level percent of covered payroll under the assumption
that covered payroll will rise by 5% per year. According to the Florida Administrative Code, this payroll
growth assumption may not exceed the average growth over the last ten years which was 3.57 %. If the
ten -year average falls below this rate next year, the amortization payments will increase. For example, if
the payroll growth assumption is lowered to 0 %, the UAL payment will increase from $1,998,931 next
year to $2,659,603.
GRS
Relationship to Market Value
If Market Value had been the basis for the valuation, the City contribution rate would have been
57.61% and the funded ratio would have been 53.5 %. In the absence of other gains and losses, the City
contribution rate should increase to that level over the next several years.
Conclusion
The remainder of this Report includes detailed actuarial valuation results, financial information,
miscellaneous information and statistics, and a summary of plan provisions.
"]NO
CHAPTER REVENUE
Increments in Chapter revenue over that received in 1998 must first be used to fund the cost of
compliance with minimum benefits. Once minimums are met, any subsequent additional Chapter
revenue must be used to provide extra benefits.
As of the valuation date, there are no minimum benefit requirements outstanding.
The Accumulated Excess shown in line 7 is being held in reserve to pay for additional benefits.
The reserve is subtracted from Plan assets (see Section C of this Report). The Base Amount in line 8 is the
maximum amount the employer may take as a credit against its required contribution; however, in no event
may the employer take credit for more than the actual amount of Chapter revenue received.
"]NO
Actuarial Confirmation of the Use of State Chapter Money
1.
Base Amount Previous Plan Year
$
412,644
2.
Amount Received for Previous Plan Year
435,787
3.
Benefit Improvements Made in Previous Plan Year
0
4.
Excess Funds for Previous Plan Year: (2) - (1) - (3)
23,143
5.
Accumulated Excess at Beginning of Previous Year
482,519
6.
Prior Excess Used in Previous Plan Year
0
7.
Accumulated Excess as of Valuation Date
(Available for Benefit Improvements): (4) + (5) - (6)
505,662
8.
Base Amount This Plan Year: (1) + (3)
412,644
The Accumulated Excess shown in line 7 is being held in reserve to pay for additional benefits.
The reserve is subtracted from Plan assets (see Section C of this Report). The Base Amount in line 8 is the
maximum amount the employer may take as a credit against its required contribution; however, in no event
may the employer take credit for more than the actual amount of Chapter revenue received.
"]NO
SECTION B
VALUATION RESULTS
GRS
PARTICIPANT DATA
October 1, 2011
October 1, 2010
ACTIVE MEMBERS
Number
84
93
Covered Annual Payroll
$
6,971,212
$
8,499,722
Average Annual Payroll
$
82,991
$
91,395
Average Age
40.1
40.8
Average Past Service
10.5
11.2
Average Age at Hire
29.6
29.6
RETIREES, BENEFICIARIES & DROP*
Number
46
35
Annual Benefits
$
3,350,377
$
2,311,315
Average Annual Benefit
$
72,834
$
66,038
Average Age
54.9
55.2
DISABILITY RETIREES
Number
10
10
Annual Benefits
$
272,822
$
272,822
Average Annual Benefit
$
27,282
$
27,282
Average Age
55.2
54.2
TERMINATED VESTED MEMBERS
Number
1
1
Annual Benefits
$
49,452
$
49,452
Average Annual Benefit
$
49,452
$
49,452
Average Age
40.0
39.0
* Does not include deferred supplemental benefits for DROP members
GRS
7
ANNUAL REQUIRED CONTRIBUTION (ARC)
A. Valuation Date
October 1, 2011
October 1, 2011
October 1, 2010
After Change
Before Change
B. ARC to Be Paid During
Fiscal YearFnding
9/30/2013
9/30/2013
9/30/2012
C. Assumed Dates of Employer
Contributions
Quarterly
Quarterly
Quarterly
D. Annual Payment to Amortize
Unfunded Actuarial Liability
$ 1,998,931
$ 1,942,897
$ 1,693,053
E. Employer Normal Cost
1,767,840
1,723,312
2,130,523
F. ARC if Paid on the Valuation
Date: D +E
3,766,771
3,666,209
3,823,576
G. ARC Adjusted for Frequency of
Payments
3,936,276
3,833,351
3,997,893
H. ARC as % of Covered Payroll
56.46 %
54.99 %
47.04 %
I. Assumed Rate of Increase in Covered
Payroll to Contribution Year
5.00 %
5.00 %
5.00 %
J. Covered Payroll for Contribution Year
7,319,773
7,319,773
8,924,708
K. ARC for Contribution Year: HxJ
4,132,744
4,025,143
4,198,183
L. Allowable Credit for State Revenue in
Contribution Year
412,644
412,644
412,644
M. Required Employer Contribution (REC)
in Contribution Year
3,720,100
3,612,499
3,785,539
N. REC as % of Covered Payroll in
Contribution Year: M - J
50.82 %
49.35 %
42.42 %
Note: The dollar amounts of the required contributions shown above are estimates only. Actual
contributions should be no less than the listed percentage of payroll multiplied by actual payroll for the year.
"]NO
ACTUARIAL VALUE OF BENEFITS AND AS SETS
A. Valuation Date
October 1, 2011
October 1, 2011
October 1, 2010
After Change
Before Change
B. Actuarial Present Value of All Projected
Benefits for
1. Active Members
a. Service Retirement Benefits
$ 44,785,102
$ 43,969,354
$ 55,887,042
b. Vesting Benefits
1,774,049
1,733,892
1,815,308
c. Disability Benefits
4,170,088
4,106,663
4,728,645
d. Preretirement Death Benefits
493,976
486,044
539,155
e. Return of Member Contributions
20,293
20,255
23,055
f Total
51,243,508
50,316,208
62,993,205
2. Inactive Members
a. Service Retirees & Beneficiaries
41,515,012
41,111,105
28,248,236
b. Disability Retirees
2,944,145
2,920,008
2,980,654
c. Terminated Vested Members
254,908
249,654
232,016
d. Total
44,714,065
44,280,767
31,460,906
3. Total for All Members
95,957,573
94,596,975
94,454,111
C. Actuarial Accrued (Past Service)
Liability per GASB No. 25
75,529,455
74,682,401
71,341,740
D. Actuarial Value of Accumulated Plan
Benefits per FASB No. 35
1. Based on Plan's Interest Rate
66,770,064
66,005,218
60,581,471
2. Based on FRS Interest Rate
64,157,459
64,157,459
N/A
E. Plan Assets
1. Market Value
40,379,486
40,379,486
38,889,826
2. Actuarial Value
45,709,740
45,709,740
41,948,009
E Unfunded Actuarial Accrued Liability: C - E2
29,819,715
28,972,661
29,393,731
G. Actuarial Present Value of Projected
Covered Payroll
63,912,054
63,574,267
71,685,528
H. Actuarial Present Value of Projected
Member Contributions
5,496,437
5,467,387
6,164,955
"]NO
CALCULATION OF EMPLOYER NORMAL COST
A. Valuation Date
October 1, 2011
October 1, 2011
October 1, 2010
After Change
Before Change
B. Normal Cost for
1. Service Retirement Benefits
$ 1,774,197
$ 1,736,849
$ 2,183,251
2. Vesting Benefits
138,517
135,646
167,637
3. Disability Benefits
293,271
289,322
356,104
4. Preretirement Death Benefits
32,643
32,200
37,485
5. Return of Member Contributions
14,695
14,778
18,272
6. Total for Future Benefits
2,253,323
2,208,795
2,762,749
7. Assumed Amount for Administrative
Expenses
114,041
114,041
98,750
8. Total Normal Cost
2,367,364
2,322,836
2,861,499
9. Total as a % of Covered Payroll
33.96%
33.32%
33.67%
C. Expected Member Contribution
599,524
599,524
730,976
D. Employer Normal Cost: B8 -C
1,767,840
1,723,312
2,130,523
E. Employer Normal Cost as a % of
Covered Payroll
25.36%
24.72%
25.07%
GRS
10
LIQUIDATION OF THE UNFUNDED ACTUARIAL ACCRUED LIABILITY
A. UAAL Amoritzation Period and Payments
Original UAAL
Current UAAL
Amortization
Period
Years
Payment
After Change
Before Change
Years
(Years)
Amount
Remaining
Amount
7/1/1986
30
$ 4,147
5
$ 1,511
$ 325
$ 325
10/1/1991
30
(1,504)
10
(923)
(108)
(109)
10/1/1991
30
286,223
10
175,174
20,515
20,596
10/1/1992
30
122,611
11
80,110
8,675
8,713
10/1/1993
30
(194,444)
12
(135,508)
(13,681)
(13,745)
10/1/1995
30
796,975
14
743,612
66,540
66,907
10/1/1996
30
(189,977)
15
(191,853)
(16,291)
(16,387)
10/1/2000
30
3,639,273
19
4,351,256
311,342
313,641
10/1/2005
30
975,210
24
1,135,960
69,643
70,278
10/1/2005
30
5,273,728
24
6,143,030
376,614
380,050
10/1/2006
30
12,571,515
25
14,235,455
850,917
858,964
10/1/2007
15
(251,668)
11
(232,700)
(25,200)
(25,309)
10/1/2008
15
3,319,494
12
3,174,862
320,534
322,048
10/1/2009
15
(137,951)
13
(133,448)
(12,647)
(12,712)
10/1/2010
15
348,981
14
344,411
30,819
30,988
10/1/2011
15
(718,288)
15
(718,288)
(60,991)
(61,351)
10/1/2011
15
847,054
15
847,054
71,925
N/A
$ 26,691,379
$ 29,819,715
$ 1,998,931
$ 1,942,897
GRS
11
B. Amortization Schedule
The UAAL is being amortized as a level percent of pas --roll. The expected amortization schedule is as
follows:
Amortization Schedule
Year
Expected UAAL
2011
$ 29,819,715
2012
29,879,542
2013
29,867,133
2014
29,774,428
2015
29,592,650
2016
29,312,272
2021
26,040,167
2026
20,198,576
2031
11,402,543
2035
1,974,707
2036
0
GRS
12
ACTUARIAL GAINS AND LOSSES
The assumptions used to anticipate mortality, employment turnover, investment income, expenses,
salary increases, and other factors have been based on long range trends and expectations. Actual
experience can vary from these expectations. The variance is measured by the gain and loss for the period
involved. If significant long term experience reveals consistent deviation from what has been expected and
that deviation is expected to continue, the assumptions should be modified. The net actuarial gain (loss) for
the past year is computed as follows:
1.
Last Year's UAAL
$ 29,393,731
2.
Last Year's Employer Normal Cost
2,322,411
3.
Last Year's Contributions
4,298,216
4.
Interest at the Assumed Rate on:
a. 1 and 2 for one year
2,378,711
b. 3 from dates paid
105,688
c. a - b
2,273,023
5.
This Year's Expected UAAL Prior to Revision:
1 + 2 - 3 + 4c
29,690,949
6.
Change in UAAL Due to Plan Amendments
and/or Changes in Actuarial Assumptions
847,054
7.
This Year's Expected UAAL: 5 + 6
30,538,003
8.
This Year's Actual UAAL
29,819,715
9.
Net Actuarial Gain (Loss): 7 - 8
718,288
10.
Gain (Loss) Due to Investments
(1,332,564)
11.
Gain (Loss) from Other Sources
2,050,852
GRS
Experience gains /losses for the past few years are as follows:
Year Ending
September 30
Gain Loss
1996
$ (284,232)
1997
(994,552)
1998
(674,477)
1999
(424,754)
2000
68,592
2001
(435,534)
2002
(2,162,823)
2003
(949,324)
2004
(246,347)
2005
(1,006,694)
2006
(1,517,294)
2007
251,668
2008
(3,319,494)
2009
137,951
2010
(348,981)
2011
718,288
GRS
13
14
Cumulative Actuarial Gains (Losses)
Balance at
Year Ending
Beginning
Gain (Loss)
Balance at
9/30
of Year
Interest
for Year
COLA
End of Year
2001
$ 0
$ 0
$ (435,534)
$ 0
$ (435,534)
2002
(435,534)
(37,020)
(2,162,823)
0
(2,635,377)
2003
(2,635,377)
(224,007)
(949,324)
0
(3,808,708)
2004
(3,808,708)
(323,740)
(246,347)
0
(4,378,795)
2005
(4,378,795)
(372,198)
(1,006,694)
0
(5,757,687)
2006
(5,757,687)
(489,403)
(1,517,294)
0
(7,764,384)
2007
(7,764,384)
(582,329)
251,668
0
(8,095,045)
2008
(8,095,045)
(607,128)
(3,319,494)
0
(12,021,667)
2009
(12,021,667)
(901,625)
137,951
0
(12,785,341)
2010
(12,785,341)
(958,901)
(348,981)
0
(14,093,223)
2011
(14,093,223)
(1,056,992)
718,288
0
(14,431,927)
GRS
15
The fund earnings and salary increase assumptions have considerable impact on the cost of the Plan
so it is important that they are in line with the actual experience. The following table shows the actual fund
earnings and salary increase rates compared to the assumed rates for the last few years:
Year Ending
Investment Return
Salary Increases
Actual
Assumed
Actual
Assumed
9/30/1990
9.1 %
8.0 %
9.1 %
6.5 %
9/30/1991
8.6
8.0
9.5
6.5
9/30/1992
8.2
8.0
10.9
6.5
9/30/1993
8.8
8.0
14.1
6.5
9/30/1994
2.4
8.0
0.6
6.5
9/30/1995
18.2
8.0
12.8
6.5
9/30/1996
5.2
8.0
3.6
6.5
9/30/1997
10.3
8.0
11.5 *
6.5
9/30/1998
9.2
8.0
10.0
6.5
9/30/1999
9.6
8.0
8.4
6.5
9/30/2000
9.0
8.0
5.9
6.5
9/30/2001
6.3
8.5
1.1
6.0
9/30/2002
(1.6)
8.5
11.8
6.0
9/30/2003
3.7
8.5
7.4
6.0
9/30/2004
3.9
8.5
16.4
6.0
9/30/2005
4.8
8.5
3.6
6.0
9/30/2006
6.5
8.5
9.7
6.0
9/30/2007
8.1
7.5
8.8
7.5
9/30/2008
3.6
7.5
13.8
7.5
9/30/2009
4.4
7.5
1.0
7.5
9/30/2010
5.6
7.5
7.7
7.5
9/30/2011
4.6
7.5
(1.9)
7.5
Average for
Years Shown
6.7
N/A
7.9
N/A
* Actual raises during the year were less than 10.0 %. However, there was a problem of underreporting of
compensation in the previous year that resulted in the 11.5% average increase.
The actual investment return rates shown above are based on the actuarial value of assets. The actual
salary increase rates shown above are the increases received by those active members who were included in
the actuarial valuations both at the beginning and the end of each year.
GRS
16
Actual (A) Compared to Expected (E) Decrements
Among Active Employees
Number
Added
Seriiee &
Active
During
DROP
Disability
Terminations
Members
Vested Other Totals
Year
Year
Retirement
Retirement
Death
End of
A
E
A
E
A
E
A
E
A
A
A
E
Ended
Year
9/30/2002
10
5
2
4
0
0
0
0
1
2
3
2
90
9/30/2003
14
9
3
5
1
0
0
0
1
4
5
3
95
9/30/2004
10
7
2
6
1
0
0
0
1
3
4
3
98
9/30/2005
11
4
2
8
0
0
0
0
0
2
2
3
105
9/30/2006
7
5
1
9
0
1
0
0
0
4
4
3
107
9/30/2007
5
5
3
6
0
1
0
0
1
1
2
3
107
9/30/2008
1
11
3
5
0
1
0
0
0
0
0
3
106
9/30/2009
5
7
6
8
0
1
0
0
1
0
1
3
104
9/30/2010
14
11
5
0
1
0
0
1
2
3
3
93
9/30/2011
4
13
11
2
0
1
0
0
0
2
2
2
84
9/30/2012
1
0
0
2
10 Yr Totals *
71
72
44
58
2
6
0
0
6
20
26
28
* Totals are through current Plan Year onk.
GRS
GRS
17
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GRS
17
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18
ACTUARIAL ASSUMPTIONS AND COST METHOD
Valuation Methods
Actuarial Cost Method - Normal cost and the allocation of benefit values between service rendered
before and after the valuation date were determined using an Individual Entry -Age Actuarial Cost
Method having the following characteristics:
(i) the annual normal cost for each individual active member, payable from the date of
employment to the date of retirement, is sufficient to accumulate the value of the member's
benefit at the time of retirement;
(ii) each annual normal cost is a constant percentage of the member's year by year projected
covered pay.
Actuarial gains /(losses), as they occur, reduce (increase) the Unfunded Actuarial Accrued Liability.
Financing of Unfunded Actuarial Accrued Liabilities - Unfunded Actuarial Accrued Liabilities (full
funding credit if assets exceed liabilities) were amortized by level (principal & interest combined)
percent -of- payroll contributions over a reasonable period of future years.
Actuarial Value of Assets - The Actuarial Value of Assets phase in the difference between the expected
actuarial value and actual market value of assets at the rate of 20% per year. The Actuarial Value of
Assets will be further adjusted to the extent necessary to fall within the corridor whose lower limit is
80% of the Market Value of plan assets and whose upper limit is 120% of the Market Value of plan
assets. During periods when investment performance exceeds the assumed rate, Actuarial Value of
Assets will tend to be less than Market Value. During periods when investment performance is less than
assumed rate, Actuarial Value of Assets will tend to be greater than Market Value.
Valuation Assumptions
The actuarial assumptions used in the valuation are shown in this Section.
Economic Assumptions
The investment return rate assumed in the valuation is 7.4% per year, compounded annually (net after
investment expenses). This assumption is being lowered by 0.1% each year until 6.5% is reached.
The Wage Inflation Rate assumed in this valuation was 3% per year. The Wage Inflation Rate is
defined to be the portion of total pay increases for an individual that are due to macro economic forces
including productivity, price inflation, and labor market conditions. The wage inflation rate does not
include pay changes related to individual merit and seniority effects.
The assumed real rate of return over wage inflation is defined to be the portion of total investment
return that is more than the assumed wage inflation rate. Considering other economic assumptions, the
7.4% investment return rate translates to an assumed real rate of return over wage inflation of 4.4 %.
"]NO
19
The rate of salary increase used for individual members is 7.5% per year. Part of the assumption is for
merit and /or seniority increase, and the other 3% recognizes wage inflation, including price inflation,
productivity increases, and other macroeconomic forces. This assumption is used to project a member's
current salary to the salaries upon which benefits will be based.
Reported base pay for new hires is increased by 15% to allow for overtime pay in the first year of
employment.
For purposes of financing the unfunded liabilities, total payroll is assumed to grow at 5% per year.
According to the Florida Administrative Code, this payroll growth assumption may not exceed the
average growth over the last ten years which was 3.57 %.
Demographic Assumptions
The mortality table was the RP -2000 Combined Healthy Participant Mortality Tables for males and
females. The provision for future mortality improvements is being made by using Scale AA after 2000.
Sample
Probability of
Future Life
Attain d
Dying Next Year
Expectancy (years)
Ages (in 2011)
Men Women
Men
Women
50
0.18% 0.14%
33.99
35.47
55
0.29 0.25
28.88
30.52
60
0.57 0.48
23.96
25.75
65
1.09 0.92
19.37
21.27
70
1.88 1.58
15.21
17.16
75
3.24 2.57
11.48
13.45
80
5.76 4.25
8.31
10.17
This assumption is used to measure the probabilities of each benefit payment being made after retirement.
For active members, the probabilities of dying before retirement were based upon the same mortality table
as members dying after retirement (75% of deaths are assumed to be service - connected).
For disabled retirees, the regular mortality tables are set forward 5 years in ages to reflect impaired
longevity.
"]NO
20
The rates of retirement used to measure the probability of eligible members retiring during the next year are
as follows:
Rates of separation from active membership were as shown below (rates do not apply to members
eligible to retire and do not include separation on account of death or disability). This assumption
measures the probabilities of members remaining in employment.
Sample % of Active Members
Age s Separating Within Next Year
20
42 -45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
10
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
20.0%
20.0%
20.0%
55.0%
65.0%
65.0%
65.0%
65.0%
100.0%
11
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
12
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
13
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
S 14
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
e 15
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
r 16
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
v 17
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
i 18
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
C 19
0.0%
0.0%
0.0%
0.0%
0.0%
2.5%
2.5%
10.0%
10.0%
10.0%
47.5%
57.5%
60.0%
60.0%
60.0%
100.0%
e 20
20.0%
22.5%
22.5%
22.5%
22.5%
25.0%
27.5%
30.0%
40.0%
45.0%
70.0%
80.0%
80.0%
80.0%
80.0%
100.0%
21
5.0%
5.0%
5.0%
10.0%
10.0%
12.5%
12.5%
12.5%
15.0%
15.0%
47.5%
65.0%
65.0%
65.0%
65.0%
100.0%
22
5.0%
5.0%
5.0%
10.0%
10.0%
12.5%
12.5%
12.5%
15.0%
15.0%
47.5%
65.0%
65.0%
65.0%
65.0%
100.0%
23
5.0%
5.0%
5.0%
10.0%
10.0%
15.0%
15.0%
15.0%
15.0%
15.0%
47.5%
65.0%
65.0%
65.0%
65.0%
100.0%
24
5.0%
5.0%
5.0%
10.0%
10.0%
15.0%
15.0%
15.0%
15.0%
15.0%
47.5%
65.0%
65.0%
65.0%
65.0%
100.0%
25
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
Rates of separation from active membership were as shown below (rates do not apply to members
eligible to retire and do not include separation on account of death or disability). This assumption
measures the probabilities of members remaining in employment.
Sample % of Active Members
Age s Separating Within Next Year
20
6.0%
25
5.7
30
5.0
35
3.8
40
2.6
45
1.6
50
0.8
55
0.3
Rates of disability among active members (75% of disabilities are assumed to be service- connected).
Sample % Becoming Disabled
Age s
within Next Year
20
0.21 %
25
0.23
30
0.27
35
0.35
40
0.45
45
0.77
50
1.50
55
2.32
GRS
21
Miscellaneous and Technical Assumptions
Administrative & Investment The investment return assumption is intended to be the return net of
Expenses investment expenses. Annual administrative expenses are assumed to
be equal to the average of the prior two years' expenses. Assumed
administrative expenses are added to the Normal Cost.
Benefit Service Exact fractional service is used to determine the amount of benefit
payable.
Decrement Operation Disability and mortality decrements operate during retirement
eligibility.
Decrement Timing Decrements of all types are assumed to occur at the beginning of the
year.
Eligibility Testing Eligibility for benefits is determined based upon the age nearest
birthday and service nearest whole year on the date the decrement is
assumed to occur.
Forfeitures For vested separations from service, it is assumed that 0% of members
separating will withdraw their contributions and forfeit an employer
financed benefit. It was further assumed that the liability at
termination is the greater of the vested deferred benefit (if any) or the
member's accumulated contributions.
Incidence of Contributions Employer contributions are assumed to be made in equal installments
at the end of each quarter. Member contributions are assumed to be
received continuously throughout the year based upon the computed
percent of payroll shown in this report, and the actual payroll payable
at the time contributions are made.
Liability Load Projected normal and early retirement benefits are loaded by 6% to
allow for the inclusion of unused sick and vacation pay in final
average earnings.
Marriage Assumption 100% of males and 100% of females are assumed to be married for
purposes of death -in- service benefits. Male spouses are assumed to be
three years older than female spouses for active member valuation
purposes.
Normal Form of Benefit A 10 -year certain and life annuity is the normal form of benefit.
Pay Increase Timing Middle of fiscal year. This is equivalent to assuming that reported
pays represent amounts paid to members during the year ended on the
valuation date.
Service Credit Accruals It is assumed that members accrue one year of service credit per year.
GRS
22
GLOSSARY
Actuarial Accrued Liability The difference between the Actuarial Present Value of Future Benefits,
(AAL) and the Actuarial Present Value of Future Normal Costs.
Actuarial Assumptions Assumptions about future plan experience that affect costs or liabilities,
such as: mortality, withdrawal, disablement, and retirement; future
increases in salary; future rates of investment earnings; future investment
and administrative expenses; characteristics of members not specified in
the data, such as marital status; characteristics of future members; future
elections made by members; and other items.
Actuarial Cost Method A procedure for allocating the Actuarial Present Value of Future Benefits
between the Actuarial Present Value of Future Normal Costs and the
Actuarial Accrued Liability.
Actuarial Equivalent Of equal Actuarial Present Value, determined as of a given date and based
on a given set of Actuarial Assumptions.
Actuarial Present Value The amount of funds required to provide a payment or series of payments
(API) in the future. It is determined by discounting the future payments with an
assumed interest rate and with the assumed probability each payment will
be made.
Actuarial Present Value of The Actuarial Present Value of amounts which are expected to be paid at
Future Benefits (APVFB) various future times to active members, retired members, beneficiaries
receiving benefits, and inactive, nonretired members entitled to either a
refund or a future retirement benefit. Expressed another way, it is the
value that would have to be invested on the valuation date so that the
amount invested plus investment earnings would provide sufficient assets
to pay all projected benefits and expenses when due.
Actuarial Valuation The determination, as of a valuation date, of the Normal Cost, Actuarial
Accrued Liability, Actuarial Value of Assets, and related Actuarial
Present Values for a plan. An Actuarial Valuation for a governmental
retirement system typically also includes calculations of items needed for
compliance with GASB No. 25, such as the Funded Ratio and the Annual
Required Contribution (ARC).
Actuarial Value of Assets The value of the assets as of a given date, used by the actuary for
valuation purposes. This may be the market or fair value of plan assets
or a smoothed value in order to reduce the year -to -year volatility of
calculated results, such as the funded ratio and the actuarially required
contribution (ARC).
"]NO
23
Amortization Method A method for determining the Amortization Payment. The most common
methods used are level dollar and level percentage of payroll. Under the
Level Dollar method, the Amortization Payment is one of a stream of
payments, all equal, whose Actuarial Present Value is equal to the UAAL.
Under the Level Percentage of Pay method, the Amortization Payment is
one of a stream of increasing payments, whose Actuarial Present Value is
equal to the UAAL. Under the Level Percentage of Pay method, the
stream of payments increases at the rate at which total covered payroll of
all active members is assumed to increase.
Amortization Payment That portion of the plan contribution or ARC which is designed to pay
interest on and to amortize the Unfunded Actuarial Accrued Liability.
Amortization Period The period used in calculating the Amortization Payment.
Annual Required The employer's periodic required contributions, expressed as a dollar
Contribution (ARC) amount or a percentage of covered plan compensation, determined
under GASB No. 25. The ARC consists of the Employer Normal Cost
and Amortization Payment.
Closed Amortization Period A specific number of years that is reduced by one each year, and declines
to zero with the passage of time. For example if the amortization period is
initially set at 30 years, it is 29 years at the end of one year, 28 years at the
end of two years, etc.
Employer Normal Cost The portion of the Normal Cost to be paid by the employer. This is
equal to the Normal Cost less expected member contributions.
Equivalent Single For plans that do not establish separate amortization bases (separate
Amortization Period components of the UAAL), this is the same as the Amortization Period.
For plans that do establish separate amortization bases, this is the period
over which the UAAL would be amortized if all amortization bases were
combined upon the current UAAL payment.
Experience Gain /Loss A measure of the difference between actual experience and that expected
based upon a set of Actuarial Assumptions, during the period between two
actuarial valuations. To the extent that actual experience differs from that
assumed, Unfunded Actuarial Accrued Liabilities emerge which may be
larger or smaller than projected. Gains are due to favorable experience,
e.g., the assets earn more than projected, salaries do not increase as fast as
assumed, members retire later than assumed, etc. Favorable experience
means actual results produce actuarial liabilities not as large as projected
by the actuarial assumptions. On the other hand, losses are the result of
unfavorable experience, i.e., actual results that produce Unfunded
Actuarial Accrued Liabilities which are larger than projected.
"]NO
24
Funded Ratio The ratio of the Actuarial Value of Assets to the Actuarial Accrued
Liability.
GASB Governmental Accounting Standards Board.
GASB No. 25 and These are the governmental accounting standards that set the accounting
GASB No. 27 rules for public retirement systems and the employers that sponsor or
contribute to them. Statement No. 27 sets the accounting rules for the
employers that sponsor or contribute to public retirement systems, while
Statement No. 25 sets the rules for the systems themselves.
Normal Cost The annual cost assigned, under the Actuarial Cost Method, to the current
plan year.
Open Amortization Period An open amortization period is one which is used to determine the
Amortization Payment but which does not change over time. In other
words, if the initial period is set as 30 years, the same 30 -year period is
used in determining the Amortization Period each year. In theory, if an
Open Amortization Period is used to amortize the Unfunded Actuarial
Accrued Liability, the UAAL will never completely disappear, but will
become smaller each year, either as a dollar amount or in relation to
covered payroll.
Unfunded Actuarial Accrued The difference between the Actuarial Accrued Liability and Actuarial
Liability Value of Assets.
Valuation Date The date as of which the Actuarial Present Value of Future Benefits are
determined. The benefits expected to be paid in the future are discounted
to this date.
"]NO
SECTION C
PENSION FUND INFORMATION
GRS
Statement of Plan Assets at Market Value
September 30
Item 2011 2010
A. Cash and Cash Equivalents (Operating Cash)
B. Receivables:
1. Member Contributions
2. Employer Contributions
3. State Contributions
4. Investment Income and Other Receivables
5. Total Receivables
C.
Investments
1.
Short Term Investments
2.
Domestic Equities
3.
International Equities
4.
Domestic Fixed Income
5.
International Fixed Income
6.
Real Estate
7.
Private Equity
8.
Total Investments
D.
Liabilities
1.
Benefits Payable
2.
Accrued Expenses and Other Payables
3.
Total Liabilities
E.
Total Market Value of Assets Available for Benefits
F.
Reserves
1.
State Contribution Reserve
2.
DROP Accounts
3.
Total Reserves
G.
Market Value Net of Reserves
H.
Allocation of Investments
1.
Short Term Investments
2.
Domestic Equities
3.
International Equities
4.
Domestic Fixed Income
5.
International Fixed Income
6.
Real Estate
7.
Private Equity
8.
Total Investments
GRS
$ 129,016
$ 73,914
971,393
350,067
$ 1,395,374
$ 1,701,615
21,218,413
3,083,297
15,483,122
1,432,846
$ 42,919,293
(164,299)
$ (164,299)
$ 44,279,384
$ (505,662)
(3,394,236)
$ (3,899,898)
$ 40,379,486
4.0%
49.4%
7.2%
36.1%
3.3%
0.0%
0.0%
$ 166,240
$ 86,565
243,209
$ 329,774
$ 2,389,830
19,008,381
3,468,678
14,677,672
1,428,171
$ 40,972,732
(4],854)
$ (41,854)
$ 41,426,892
$ (482,519)
(2,054,547)
$ (2,537,066)
$ 38,889,826
5.8%
46.4%
8.5%
35.8%
3.5%
0.0%
n not
100.0% 100.0%
25
Reconciliation of Plan Assets
September 30
Item 2011 2010
A. Market Value of Assets at Beguulalg of Year
B. Revenues and Expenditures
1. Contributions
a. Member Contributions
b. Employer Contributions
c. State Contributions
d. Total
2. Investment Income
26
$ 41,403,852 * $ 34,032,253
$ 690,226
$ 802,883
3,885,572
3,955,968
435,787
435,832
$ 5,011,585
$ 5,194,683
a.
Interest, Dividends, and Other Income
$
832,952
$
760,191
b.
Net Realized/Unrealized Gains /(Losses) **
(851,895)
2,895,214
c.
Investment Expenses
(136,513)
(139,283)
d.
Net Investment Income
$
(155,456)
$
3,516,122
3. Benefits
and Refunds
a.
Regular Monthly Benefits
$
(1,568,779)
$
(1,105,160)
b.
Refunds
(21,975)
(27,142)
c.
Lump Sum Benefits
-
-
d.
DROP Distributions
(254,626)
(91,000)
e.
Total
$
(1,845,380)
$
(1,223,302)
4. Administrative and Miscellaneous Expenses
$
(135,217)
$
(92,864)
5. Transfers
C. Market Value of Assets at End of Year
D. Reserves
$ 44,279,384 $ 41,426,892
1. State Contribution Reserve $ (505,662) $ (482,519)
2. DROP Accounts (3,394,236) (2,054,547)
3. Total Reserves $ (3,899,898) $ (2,537,066)
E. Market Value Net of Reserves $ 40,379,486 $ 38,889,826
* Beginning balance has been adjusted to match final balance from the financial statements for FYE
9/30/2010.
* * Breakdown between realized and unrealized gains /(losses) was not provided.
GRS
27
Reconciliation of DROP Accounts
Ye ar
Balance at
Balance at
Ended
Beginning
End of
9/30
of Year
Credits
Interest
Distributions Adjus tine nts
Year
2002
$ -
$ 25,536
$ 559
$ - $ -
$ 26,095
2003
26,095
35,048
962
(33,734) -
28,371
2004
28,371
67,278
4,210
- -
99,859
2005
99,859
107,716
9,307
(54,224) -
162,658
2006
162,658
88,332
13,653
- -
264,643
2007
264,643
164,844
22,183
- -
451,670
2008
451,670
188,434
24,255
(215,043) 2,665
451,981
2009
451,981
557,339
46,178
- -
1,055,498
2010
1,055,498
993,753
96,296
(91,000) -
2,054,547
2011
2,054,547
1,426,393
167,922
(254,626) -
3,394,236
GRS
28
Calculation of Actuarial Value of Assets
Year Ending September 30
Item 2011 2010
A. Beginning of Year Assets*
* Before offset of DROP Account Balances and State Contribution Reserve.
* *Adjusted to reflect final figures from the financial statements for FYE 9/30/2010.
GRS
1. Market Value
$ 41,403,852 **
$ 34,032,253
2. Actuarial Value
44,485,075
38,349,451
B.
End of Year Market Value
of Assets*
44,279,384
41,426,892
C.
Net of Contributions
Less Disbursements
3,007,948 **
3,878,517
D.
Actual Net Investment
Earnings
(155,456)
3,516,122
E.
Expected Investment
Earnings
3,449,179
3,021,653
F.
End of Year Expected
Actuarial Value
50,942,202
45,249,621
G.
End of Year Market Value Less
Expected Actuarial Value: B - F
(6,662,818)
(3,822,729)
H.
20% of Difference
(1,332,564)
(764,546)
L
End of Year Assets
1. Actuarial Value:
F + H
49,609,638
44,485,075
2. Final Actuarial Value
Within 80% to 120%
of Market Value
49,609,638
44,485,075
J.
State Contribution Reserve
505,662
482,519
K.
DROP Accounts
3,394,236
2,054,547
L.
Final Actuarial Value of Assets:
I2 - J - K
45,709,740
41,948,009
M.
Recognized Investment Earnings
2,116,615
2,257,107
N.
Recognized Rate of Return
4.6%
5.6%
* Before offset of DROP Account Balances and State Contribution Reserve.
* *Adjusted to reflect final figures from the financial statements for FYE 9/30/2010.
GRS
29
Year Ending
September 30
Investment Rate of Return
Market Value * Actuarial Value
1990
9.1
%
9.1
%
1991
8.6
8.6
1992
8.2
8.2
1993
8.8
8.8
1994
2.4
2.4
1995
18.2
18.2
1996
5.2
5.2
1997
24.2
10.3
1998
5.3
9.2
1999
11.6
9.6
2000
6.7
9.0
2001
(7.8)
6.3
2002
(6.5)
(1.6)
2003
12.7
3.7
2004
8.6
3.9
2005
9.6
4.8
2006
6.4
6.5
2007
11.5
8.1
2008
(13.9)
3.6
2009
6.7
4.4
2010
9.8
5.6
2011
(0.4)
4.6
Average Returns:
Last 5 Years
2.3
%
5.2
%
Last 10 Years
4.1
%
4.3
%
All Years
6.3
%
6.7
%
* Net of investment expenses after 2005.
The above rates are based on the retirement system's financial information reported to the actuary. They
may differ from figures that the investment consultant reports, in part because of differences in the
handling of administrative and investment expenses, and in part because of differences in the handling of
cash flows.
GRS
SECTION D
FINANCIAL ACCOUNTING INFORMATION
GRS
30
FASB NO. 35 INFORMATION
A. Valuation Date
October 1, 2011
October 1, 2010
B. Actuarial Present Value of Accumulated
Plan Benefits
1. Vested Benefits
a. Members Currently Receiving Payments
$ 44,459,157
$ 31,228,890
b. Terminated Vested Members
254,908
232,016
c. Other Members
20,221,453
27,248,069
d. Total
64,935,518
58,708,975
2. Non - Vested Benefits
1,834,546
1,872,496
3. Total Actuarial Present Value of Accumulated
Plan Benefits: Id + 2
66,770,064
60,581,471
4. Accumulated Contributions of Active Members
4,622,917
5,275,526
C. Changes in the Actuarial Present Value of
Accumulated Plan Benefits
1. Total Value at Beginning of Year
60,581,471
54,441,005
2. Increase (Decrease) During the Period
Attributable to:
a. Plan Amendment and Change in
Actuarial Assumptions
764,846
0
c. Latest Member Data, Benefits Accumulated
and Decrease in the Discount Period
8,440,894
7,363,768
d. Benefits Paid
(3,017,147)
(1,223,302)
e. Net Increase
6,188,593
6,140,466
3. Total Value at End of Period
66,770,064
60,581,471
D. Actuarial Present Value of Accumulated Plan
Benefits Using FRS Interest Rate
a. Vested
62,459,677
N/A
b. Non - Vested
1,697,782
N/A
c. Total
64,157,459
N/A
E. Market Value of Assets
40,379,486
38,889,826
F. Funded Ratio Using FRS Interest Rate
62.9%
N/A
G. Actuarial Assumptions - See page entitled
Actuarial Assumptions and Methods
GRS
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-
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--
--
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GRS
31
U
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c -0
32
SCHEDULE OF CONTRIBUTIONS FROM THE EMPLOYER
AND THE STATE OF FLORIDA
(GASB Statement No. 25)
Year Ending
September 30
Annual Required
Contribution
Actual
Contribution
Percentage
Contributed
1994
$ 242,083
$ 268,705
111.0%
1995
244,317
258,492
105.8
1996
404,856
438,206
108.2
1997
438,074
469,583
107.2
1998
592,522
601,235
101.5
1999
760,142
760,959
100.1
2000
853,790
853,790
100.0
2001
935,273
945,392
101.1
2002
1,005,662
1,015,588
101.0
2003
1,425,328
1,425,328
100.0
2004
1,475,340
1,475,340
100.0
2005
1,704,041
1,704,041
100.0
2006
1,931,054
2,107,880
109.2
2007
3,176,791
3,176,791
100.0
2008
3,556,548
3,556,548
100.0
2009
3,762,323
3,762,323
100.0
2010
4,368,612
4,368,612
100.0
2011
4,298,216
4,298,216
100.0
GRS
33
ANNUAL PENSION COST AND NET PENSION OBLIGATION
(GASB STATEMENT NO. 27)
Employer FYE September 30
2012
2011
2010
Annual Required Contribution (ARC)*
$ 4,198,183 i $
4,298,216
$ 4,368,612
Interest on Net Pension Obligation (NPO)
(14,872)
(15,858)
(16,722)
Adjustment to ARC
(23,829)
(26,320)
(28,243)
Annual Pension Cost (APC)
4,207,140
4,308,678
4,380,133
Contributions made
**
4,298,216
4,368,612
Increase (decrease) in NPO
**
10,462
11,521
NPO at beginning of year
(200,973)
(211,435)
(222,956)
NPO at end of year
**
(200,973)
(211,435)
* Includes expected State contribution.
**To be determined.
' This amount is an estimate. The final required contribution should be no less
than the percent
of payroll
requirement multiplied by the actual covered payroll for the fiscal year.
THREE YEAR TREND INFORMATION
Fiscal
Annual Pension
Actual
Percentage of
Net Pension
Year Ending
Cost (APC)
Contribution
APC Contributed
Obligation
9/30/2009
$ 3,773,193
$ 3,762,323
99.7 %
$ (222,956)
9/30/2010
4,380,133
4,368,612
99.7
(211,435)
9/30/2011
4,308,678
4,298,216
99.8
(200,973)
GRS
34
REQUIRED SUPPLEMENTARY INFORMATION
GASB Statement No. 25 and No. 27
The information presented in the required supplementary schedules was determined as part of the
actuarial valuations at the dates indicated. Additional information as of the latest actuarial valuation:
Valuation Date
Contribution Rates
Employer (and State)
Plan Members
Actuarial Cost Method
Amortization Method
Remaining Amortization Period
Asset Valuation Method
Actuarial Assumptions
Investment rate of return
Projected salary increases
Includes inflation and other general increases at
Cost -of- living adjustments
GRS
October 1, 2011
56.46%
8.60%
Entry Age Normal
Level percent, closed
25 years
Recognizes 20% of difference
between market value of assets
and expected actuarial asset
value
7.4%
7.5%
3.0%
Not Applicable
SECTION E
MISCELLANEOUS INFORMATION
GRS
RECONCU JATION OF MEMBERSHIP DATA
From 10 /1 /10
From 10/1/09
T010/1/11
T010/1/10
A. Active Members
1. Number Included in Last Valuation
93
104
2. New Members
4
3
3. Non - Vested Employment Terminations
(2)
(2)
4. Vested Employment Terminations
0
(1)
5. Service Retirements
0
0
6. DROP Retirement
(11)
(11)
7. Disability Retirements
0
0
8. Deaths
0
0
9. Other -- Data Corrections
0
0
10. Number Included in This Valuation
84
93
B. Terminated Vested Members
1. Number Included in Last Valuation
1
0
2. Additions from Active Members
0
1
3. Lump Sum Payments/Refund of Contributions
0
0
4. Payments Commenced
0
0
5. Deaths
0
0
6. Other
0
0
7. Number Included in This Valuation
1
1
C. DROP Plan Members
1. Number Included in Last Valuation
15
9
2. Additions from Active Members
11
11
3. Retirements
(2)
(5)
4. Deaths Resulting in No Further Payments
0
0
5. Other
0
6. Number Included in This Valuation
24
15
D. Service Retirees, Dis ability Retirees and Beneficiaries
1. Number Included in Last Valuation
30
26
2. Additions from Active Members
0
i
3. Additions from Terminated Vested Members
0
0
4. Additions from DROP
2
5
5. Deaths Resulting in No Further Payments
0
(1)
6. Deaths Resulting in New Survivor Benefits
0
0
7. End of Certain Period - No Further Payments
0
0
8. Other
0
0
9. Number Included in This Valuation
32
30
GRS
35
36
ACTIVE PARTICIPANT DISTRIBUTION
GRS
Yeats of Seib -ice to Valuation Date
Age Group
0 -1
1 -2
2 -3
3 -4
4 -5
5 -9
10 -14
15 -19
20 -24
25 & Up
Totals
20 -24 NO.
2
0
0
0
0
0
0
0
0
0
2
TOT PAY
96,762
0
0
0
0
0
0
0
0
0
96,762
AVG PAY
48,381
0
0
0
0
0
0
0
0
0
48,381
25 -29 NO.
0
0
1
1
4
2
0
0
0
0
8
TOT PAY
0
0
55,228
62,473
235,150
137,194
0
0
0
0
490,045
AVG PAY
0
0
55,228
62,473
58,788
68,597
0
0
0
0
61,256
30 -34 NO.
1
0
0
0
1
3
2
0
0
0
7
TOT PAY
48,381
0
0
0
63,062
216,378
154,654
0
0
0
482,475
AVG PAY
48,381
0
0
0
63,062
72,126
77,327
0
0
0
68,925
35 -39 NO.
0
0
0
0
0
14
4
3
0
0
21
TOT PAY
0
0
0
0
0
951,988
277,323
282,877
0
0
1,512,188
AVG PAY
0
0
0
0
0
67,999
69,331
94,292
0
0
72,009
40 -44 NO.
0
1
0
0
1
6
7
6
0
0
21
TOT PAY
0
48,449
0
0
67,387
421,875
540,256
590,855
0
0
1,668,822
AVG PAY
0
48,449
0
0
67,387
70,313
77,179
98,476
0
0
79,468
45 -49 NO.
0
0
0
0
0
4
1
10
1
0
16
TOT PAY
0
0
0
0
0
272,038
78,971
1,056,611
130,401
0
1,538,021
AVGPAY
0
0
0
0
0
68,010
78,971
105,661
130,401
0
96,126
50 -54 NO.
0
1
0
0
0
0
1
4
0
0
6
TOT PAY
0
122,165
0
0
0
0
109,650
423,663
0
0
655,478
AVG PAY
0
122,165
0
0
0
0
109,650
105,916
0
0
109,246
55 -59 NO.
0
0
0
0
0
1
0
1
0
0
2
TOT PAY
0
0
0
0
0
66,956
0
92,764
0
0
159,720
AVG PAY
0
0
0
0
0
66,956
0
92,764
0
0
79,860
60 -64 NO.
1
0
0
0
0
0
0
0
0
0
1
TOT PAY
124,194
0
0
0
0
0
0
0
0
0
124,194
AVG PAY
124,194
0
0
0
0
0
0
0
0
0
124,194
65 -69 NO.
0
0
0
0
0
0
0
0
0
0
0
TOT PAY
0
0
0
0
0
0
0
0
0
0
0
AVG PAY
0
0
0
0
0
0
0
0
0
0
0
TOT NO.
4
2
1
1
6
30
15
24
1
0
84
TOT AMT
269,337
170,614
55,228
62,473
365,599
2,066,429
1,160,854
2,446,770
130,401
0
6,727,705
AVG AMT
67,334
85,307
55,228
62,473
60,933
68,881
77,390
101,949
130,401
0
80,092
GRS
37
INACTIVE PARTICIPANT DISTRIBUTION
* Does not include deferred supplemental benefits for DROP members
GRS
Terminated Vested
Disabled
Retired*
Deceasedwith
Beneficiary
Total
Total
Total
Total
Age Group
Number Benefits
Number Benefits
Number Benefits
Number Benefits
Under 20
- -
- -
- -
- -
20 -24
- -
- -
- -
- -
25 -29
- -
- -
- -
- -
30 -34
- -
- -
- -
- -
35 -39
1 49,452
- -
- -
- -
40 -44
- -
- -
- -
- -
45 -49
- -
1 23,392
19 1,691,280
- -
50 -54
- -
3 87,331
8 698,130
- -
55 -59
- -
5 144,248
5 354,980
1 33,777
60 -64
- -
1 17,851
6 303,764
1 32,070
65 -69
- -
- -
4 144,116
- -
70 -74
- -
- -
2 92,260
- -
75 -79
- -
- -
- -
- -
80 -84
- -
- -
- -
- -
85 -89
- -
- -
- -
- -
90 -94
- -
- -
- -
- -
95 -99
- -
- -
- -
- -
100 & Over
- -
- -
- -
- -
Total
1 49,452
10 272,822
44 3,284,530
2 65,847
Average Age
40
55
61
* Does not include deferred supplemental benefits for DROP members
GRS
SECTION F
SUMMARY OF PLAN PROVISIONS
GRS
SUMMARY OF PLAN PROVISIONS
A. Ordinances
38
The Plan was established under the Code of Ordinances for the City of Palm Beach Gardens,
Florida, Chapter 50, Article III, and was most recently amended under Ordinance No. 2, 2010
passed and adopted on February 18, 2010. The Plan is also governed by certain provisions of
Chapter 185, Florida Statutes, Part VII, Chapter 112, Florida Statutes and the Internal Revenue
Code.
B. Effective Date
July 1, 1972
C. Plan Year
October 1 through September 30
D. Type of Plan
Qualified, governmental defined benefit retirement plan; for GASB purposes it is a single employer
plan.
E. Eligibility Requirements
All full -time police officers are eligible for membership on the first day of the month coincident
with or next following date of employment.
F. Credited Service
Service is measured as the total number of full years (and fraction thereof) of continuous service
from the date of employment to the date of termination. No service is credited for any periods of
employment for which the member received a refund of employee contributions.
G. Compensation
Actual compensation reported to the Internal Revenue Service for income tax purposes, plus
deferred compensation.
H. Average Monthly Earnings (AME)
The average of Compensation over the last 5 years of Credited Service; includes lump sum payment
of unused leave pay.
GRS
39
L Normal Retirement
Eligibility: A member may retire on the first day of the month coincident -,with or next
following the earlier of
(1) age 52 and 10 years of Credited Service, or
(2) 20 years of Credited Service regardless of age.
Benefit: 3.5% of AME multiplied by years of Credited Service with a maximum equal to
100% of AME.
Normal Form
of Benefit: 10 Years Certain and Life thereafter; other options are also available.
Supplemental
Benefit: A monthly supplemental benefit of $12.50 per year of Credited Service is payable
to all retirees and their beneficiaries in pay status.
COLA: There are currently no annual cost of living increases, but ad hoc increases may be
authorized by the Board of Trustees. Also see Section W, Cost of Living Increases.
J. Early Retirement
Eligibility: A member may elect to retire earlier than the Normal Retirement Eligibility upon
attainment of age 50 and 10 years of Credited Service.
Benefit: The Normal Retirement Benefit is reduced by 3.0% for each year by which the
Early Retirement date precedes the Normal Retirement date.
Normal Form
of Benefit: 10 Years Certain and Life thereafter; other options are also available.
Supplemental
Benefit: A monthly supplemental benefit of $12.50 per year of Credited Service is payable
to all retirees and their beneficiaries in pay status.
COLA: There are currently no annual cost of living increases, but ad hoc increases may be
authorized by the Board of Trustees. Also see Section W, Cost of Living Increases.
K. Delayed Retirement
Same as Normal Retirement taking into account compensation earned and service credited until the
date of actual retirement.
L. Service Connected Disability
Eligibility: Any member who becomes totally and permanently disabled and unable to render
useful and efficient service as a police officer for a period of at least 6 months
resulting from an act occurring in the performance of service for the City is eligible
for a disability benefit.
"]NO
40
Benefit: 60% of the current rate of pay, but no less than the accrued Normal Retirement
Benefit taking into account compensation earned and service credited until the date
of disability. Disability benefits, when combined with Social Security, Worker's
Compensation or any other local, state or federal government benefits, cannot
exceed and will be limited to the AME on the date of disability.
Normal Form
of Benefit: 10 Years Certain and Life thereafter; other options are also available.
Supplemental
Benefit: A monthly supplemental benefit of $12.50 per year of Credited Service is payable
to all retirees and their beneficiaries in pay status.
COLA: There are currently no annual cost of living increases, but ad hoc increases may be
authorized by the Board of Trustees. Also see Section W, Cost of Living Increases.
M. Non - Service Connected Disability
Eligibility: Any member with 10 years of Credited Service who becomes totally and
permanently disabled and unable to render useful and efficient service as a police
officer for a period of at least 6 months is eligible for a disability benefit.
Benefit: 2.5% of AME multiplied by Credited Service, but not less than 25% of salary or the
accrued Normal Retirement Benefit taking into account compensation earned and
service credited until the date of disability. Disability benefits, when combined
with Social Security, Worker's Compensation or any other local, state or federal
government benefits, cannot exceed and will be limited to the AME on the date of
disability.
Normal Form
of Benefit: 10 Years Certain and Life thereafter; other options are also available.
Supplemental
Benefit: A monthly supplemental benefit of $12.50 per year of Credited Service is payable
to all retirees and their beneficiaries in pay status.
COLA: There are currently no annual cost of living increases, but ad hoc increases may be
authorized by the Board of Trustees. Also see Section W, Cost of Living Increases.
N. Death in the Line of Duty
Eligibility: Members who die as a result of personal injury or disease arising out of the
member's actual performance of duties are eligible for survivor benefits regardless
of Credited Service.
"]NO
41
Benefit: The surviving spouse will receive the greater of
(1) 50% of the member's AME, or
(2) the member's accrued Normal Retirement Benefit as of the date of death with no
actuarial reduction for Early Retirement.
If there is no spouse, or if the surviving spouse dies, the spouse's benefit
determined above shall be distributed equally among any eligible children. If there
is no spouse or eligible children, the benefit will be paid to the deceased member's
estate.
Normal Form
of Benefit: Spouse's benefits are payable until death; children's benefits are payable until age
18 (24 if a full -time student), marriage, death, or adoption. Benefits paid to a
member's estate may be paid as a lump sum at the discretion of the Board of
Trustees.
Supplemental
Benefit: A monthly supplemental benefit of $12.50 per year of Credited Service is payable
to all retirees and their beneficiaries in pay status.
COLA: There are currently no annual cost of living increases, but ad hoc increases may be
authorized by the Board of Trustees. Also see Section W, Cost of Living Increases.
O. Other Pre - Retirement Death
Eligibility: Members are eligible for survivor benefits after the completion of 5 or more years
of Credited Service.
Benefit: The survivor benefit payable to the designated beneficiary is the member's accrued
Normal Retirement Benefit. Benefit is payable at the member's Early or Normal
retirement date and will be actuarially reduced for Early Retirement when
applicable.
Normal Form
of Benefit: For member's eligible for Normal or Delayed Retirement on the date of death, the
designated beneficiary's benefit will be paid for life. For members not yet
eligible, benefits will be paid for 10 years.
Supplemental
Benefit: A monthly supplemental benefit of $12.50 per year of Credited Service is payable
to all retirees and their beneficiaries in pay status.
COLA: There are currently no annual cost of living increases, but ad hoc increases may be
authorized by the Board of Trustees. Also see Section W, Cost of Living Increases.
The beneficiary of a plan member with less than 5 years of Credited Service at the time of death
will receive a refund of the member's accumulated contributions without interest.
GRS
42
P. Post Retirement Death
Benefit determined by the form of benefit elected upon retirement.
Q. Optional Forms
In lieu of electing the Normal Form of benefit, the optional forms of benefits available to all retirees
are a Single Life Annuity or the 50 %, 66 2/3 %, 75% and 100% Joint and Survivor options.
R. Vested Termination
Eligibility
Benefit:
Normal Form
of Benefit:
Supplemental
Benefit:
COLA
A member has earned a non - forfeitable right to Plan benefits after the completion of
5 years of Credited Service (see vesting table below).
Years of
Credited Service
Vested
%
Under 5
0%
5
25
6
40
7
55
8
70
9
85
10 or more
100
The benefit is the member's vested accrued Normal Retirement Benefit as of the
date of termination. Benefit begins at the member's Normal Retirement date.
Alternatively, members with at least 10 years of Credited Service may elect to
receive an actuarially reduced Early Retirement Benefit any time after age 50.
10 Years Certain and Life thereafter; other options are also available.
A monthly supplemental benefit of $12.50 per year of Credited Service is payable
to all retirees and their beneficiaries once in pay status.
There are currently no annual cost of living increases, but ad hoc increases may be
authorized by the Board of Trustees. Also see Section W, Cost of Living Increases.
Members terminating employment with less than 5 years of Credited Service will receive a refund of
their own accumulated contributions without interest.
GRS
43
S. Refunds
Eligibility: All members terminating employment with less than 5 years of Credited Service are
eligible. Optionally, vested members (those with 5 or more years of Credited
Service) may elect a refund in lieu of the vested benefits otherwise due.
Benefit: Refund of the member's contributions without interest.
T. Member Contributions
8.6% of Compensation
U. State Contributions
Chapter 185 Premium Tax Refunds
V. Employer Contributions
Any additional amount needed to fund the plan properly according to State laws.
W. Cost of Living Increases
Actuarial gains realized for the prior fiscal year may be used to increase benefits on July 1st of
each year for members who have been retired for at least 1 year. Upon approval by the Board of
Trustees, the gain will be distributed to all pensioners as an equal percentage increase in their
benefit, but is limited to 4% in any year. If there was no actuarial gain realized for the prior fiscal
year, then no cost of living adjustment will be authorized.
X. 13th Check
Not Applicable
Y. Deferred Retirement Option Plan
Eligibility: A member may enter the DROP on the first day of the month coincident with or
next following the earlier of
(1) age 52 and 10 years of Credited Service, or
(2) 20 years of Credited Service regardless of age.
Members who meet eligibility must submit a written election to participate in the
DROP. The election to participate must be made within the first 28.5 years of
Credited Service and members can no longer participate after attaining 33.5 years of
employment service.
Benefit: The member's Credited Service and AME are frozen upon entry into the DROP.
The monthly retirement benefit as described under Normal Retirement is calculated
based upon the frozen Credited Service and AME.
"]NO
44
Maximum
DROP Period: 60 months
Interest
Credited: The member's DROP account is credited quarterly at an interest rate based upon
the option chosen by the member. Members must elect from 1 of the 2 following
options:
1. Gain or loss at the same rate earned by the Plan, or
2. Guaranteed rate of 6.5% per annum.
Normal Form
of Benefit: Lump Sum; member may also elect that the DROP distribution be paid in 3 equal
payments over 3 years or used to purchase an annuity to be paid in monthly
installments.
COLA: There are currently no annual cost of living increases, but ad hoc increases may be
authorized by the Board of Trustees. Also see Section W, Cost of Living Increases.
Z. Other Ancillary Benefits
There are no ancillary retirement type benefits not required by statutes but which might be deemed
a City of Palm Beach Gardens Police Officers' Pension Fund liability if continued beyond the
availability of funding by the current funding source.
AA. Changes from Previous Valuation
There have been no changes in benefits since the previous valuation.
"]NO