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17-93 ORDINANCE NO. 17-93 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AMENDING TITLE III, "ADMINISTRATION", CHAPTER 33, "POLICE AND FIRE DEPARTMENTS", SUBHEADING "PENSIONS", OF THE CODE OF ORDINANCES OF THE CITY OF DELRAY BEACH, FLORIDA, BY AMENDING SECTION 33.62, "BENEFIT AMOUNTS AND ELIGIBILITY", TO PROVIDE FOR CERTAIN GRAMMATICAL AND VERBIAGE CHANGES; PROVIDING A SAVING CLAUSE, A GENERAL REPEALER CLAUSE, AND AN EFFECTIVE DATE. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AS FOLLOWS: Section 1. That Title III, "Administration", Chapter 33, "Police and Fire Departments", Subheading "Pensions", Section 33.62, "Benefit Amounts and Eligibility", of the Code of Ordinances of the City of Delray Beach, Florida, be, and the same is hereby amended to read as follows: Section 33.62 BENEFIT AMOUNTS AND ELIGIBILITY. ~/~//~//f~//~//~f/~//~//~f//~~//W~//~ ~//~//~//~~///6f//~//f~f~~///b~~ ~/~/~9~9~ This term shall have the following meanings: 1. For employees who are eligible to become members of the system as of its effective date, the normal retirement date shall be the date of their fifty-second birthday, regardless of the number of years of continuous service. 2. For employees who are members of the system and terminate employment prior to October 1, 1989, the normal retirement date shall be the first day of the month coincident with or subsequent to their fifty-second birthday and the completion of twenty (20) years of continuous service. 3__~. For employees who are members of the system and elect to retire or terminate employment on or subsequent to October 1, 1989, the normal retirement date shall be the first day of the month coincident with or subsequent to completion of twenty (20) years of continuous service. (B) Normal retirement benefit. (1) Duration, survivor benefits. A member retiring ~~ on his normal retirement date shall receive a monthly benefit which shall commence on his normal retirement date and be continued thereafter during his lifetime~ ~pon his death the full retirement benefit shall be continued to his spouse for one year and sixty percent (60%) of that amount continued thereafter until the earlier of death or remarriage. (2) Amount. Normal retirement benefits shall be in the amount of two and one-half percent of average monthly earnings for each year of continuous service, subject ~/~//~ to a maximum of seventy-five percent (75%) of average monthly earningsi~ ~owever, members as of the effective date shall receive at their normal retirement date (age 52 regardless of years of service) the greater of the benefit provided by the formula above or fifty percent (50%) of average monthly earnings. (3) Upon becoming eligible for normal retirement, a member shall be one hundred percent (100%) vested in his accrued benefit. (C) Disability retirement provisions. (1) (a) For purposes of this system, "TOTAL AND PERMANENT DISABILITY" shall mean an injury, disease or condition which totally and permanently incapacitates a member, either physically or mentally, from his regular and continuous duty as a police officer or firefighter. A "TOTAL AND PERMANENT DISABILITY" arising directly from the performance of service to the city by a member as a police officer or firefighter shall be considered to be a service incurred disability. A "TOTAL AND PERMANENT DISABILITY" arising from any other cause or source, other than as modified below, shall be considered to be a nonservice incurred disability. A member shall not be entitled to receive a disability retirement benefit from the system if the disability is a result of: 1. Excessive and habitual use of drugs, intoxicants or narcotics; 2. Injury or disease sustained by the member while willfully and illegally participating in fights, riots, civil insurrections, or while committing a crime; 3. Injury or disease sustained by a member while serving in any of the armed forces; 4. Injury or disease sustained by the member after his employment with the city has been terminated. (b) A member shall not receive a service incurred disability benefit for injury or disease sustained by the member while working (either as an employee or through some other contractual arrangement) for anyone other than the city, performing a job function the same as or related to the member's city job function, and arising out of the scope of any other employment or contractual arrangement, excepting injuries sustained by members while performing duties on behalf of the city and while within the city's jurisdiction although those injuries occurred at an outside employer's job site. In addition, a member shall not be entitled to receive a disability retirement benefit from the system on the basis of any condition which existed prior to the member's employment or which was evidenced during the member's preemployment physical. (2) Application for benefits. In order for the Board to consider a member's request for disability retirement benefits, the member must apply in writing to the Board. ~ ~~lm~l~l~ll~l~l~ll~l~~lf~W~ll~ - 2 - Ord. No. 17-93 B~ Upon receipt of proper application by the Board of Trustees, the Board of Trustees shall arrange for a physical examination of the applicant by the medical board. A further condition for receipt of disability retirement benefits from the system is that the applicant must apply for and diligently pursue disability benefits from social security and workers' compensation. Written proof of application must be submitted to the Board of Trustees. Failure of the applicant to qualify as being disabled under either the social security or workers' compensation laws may be considered by the Board of Trustees in review ~/~~~ ~/~/~//~f/~~ of that member's ~~//~~ apDlication or recovery from disability. (3) Medical board. When a member submits proper application for a disability retirement benefit, the Board of Trustees shall designate a medical board to be composed of at least one b~/~/~/~//~ physician~. T~/~/~f medical board shall arrange for and pass upon all medical examinations required under the provisions of this subchapter, shall investigate all essential statements or certificates made by or on behalf of a member in connection with an application for disability retirement and shall report in writing to the Board of Trustees its conclusions and recommendations upon all matters referred to it. The payment of those services shall be determined by the Board of Trustees. (4) Determination of disability. All questions relating to eligibility for initial payment or continuance of disability benefits shall be determined by the Board of Trustees, taking into consideration the recommendations of the medical board and any other evidence of which the Board of Trustees may avail itself. The general steps which the Board of Trustees shall follow in its determination shall be as listed below, provided however, that the Board of Trustees may, in its discretion, alter or modify these steps: (a) Determine whether the member's application is proper~ ~/~tm~ (b) If application is for a nonservice incurred disability, determine whether the ten years of continuous service requirement has been met. (c) Based on all evidence submitted to the Board of Trustees, determine whether the applicant satisfies the definition of disability, including the absence of listed exclusions. (d) Determine whether the disability is to be considered a service incurred disability or a nonservice disability, taking into consideration F.S. Chapters 175.231 and (e) Establish a date of disability. This date may be the date of injury causing the disability, the date when the member could no longer perform his regular and continuous duties, the date when his sick pay and vacation pay are exhausted or such other date as determined by the Board of Trustees. - 3 - Ord. No. 17-93 (5) Disability retirement benefits. (a) Eligibility. Each ~IZ member~ ~ shall be eligible for service incurred disability benefits, regardless of ~-~ length of continuous service. Each member who completes ten (10) years of continuous service prior to becoming disabled shall be eligible for nonservice incurred disability benefits. (b) Initial amount of service incurred disability benefit. Seventy-five percent (75%) of the member's average monthly earnings in effect on the date of disability, subject in any event to the offsets listed below. (c) Initial amount of nonservice incurred disability benefit. W~/~Z~I~//~_Two percent (2%) of average monthly earnings in effect on the date of disability for each year of continuous service, subject in any event to maximum fifty percent (50%) of average monthly earnings and subject further to the offsets listed below. (d) Terms of payments. Disability benefits shall commence on or as of the first day of the month coincident with or next following the date of disability, as. established by the Board of Trustees, and shall continue to be paid on the first day of each subsequent month until the death or recovery of the disability retiree. The same survivorship percentages which apply to normal retirement benefits shall also apply to disability retirement benefits. (e) Benefit offsets. Disability retirement benefits described above shall be reduced by any disability benefits paid by social security, by workers' compensation benefits to the extent such benefits when added to the member's disability retirement benefit from the system exceed the member's average monthly earnings on the date of disability, and by other benefit offsets set forth in division (C) (7) of this section. The reduction for social security shall be in the amount of the primary insurance amount only, not including any family benefit. Any cost of living adjustments in the disability retiree's social security and workers' compensation benefits shall not serve to reduce further the disability benefit payable from the system. The reduction for social security disability benefits shall terminate upon the retiree's attainment of age sixty-five (65). In the case of a lump sum settlement paid by workers' compensation, the disability retirement benefit .payable from the system shall be adjusted as follows: 1. The amount of the lump sum settlement shall be divided by the member's remaining life expectancy (in months), as determined using standard actuarial tables approved by the plan actuary; 2. If the number obtained in division 1. above, when added to the'member's monthly disability retirement benefit from the system, exceeds the member's average monthly earnings on the date of disability, the amount of the excess shall be deducted from the member's monthly disability retirement benefit from the system, for the duration of the member's remaining life expectancy as determined in division 1. above. - 4 - Ord. No. 17-93 3. If the number obtained in division 1. above, when added to the member's monthly disability retirement benefit from the system, does not exceed the member's average monthly earnings on the date of disability, there shall be no reduction of the member's disability retirement benefits from the system. Once the number of months of suspension has been completed, the disability retirement benefit from the system shall be resumed. Additional benefit adjustments shall also apply as described below in division (C) (7) of this section. (f) Eligibility for other benefits. In the event that a member applying for disability benefits is also eligible for either early or normal retirement, the Board may, upon the request of the member, pay the early or normal retirement benefit instead of a disability retirement benefit. (6) Annual report by disability retiree. (a) Each person currently receiving disability retirement benefits and each person who first qualifies for disability retirement benefits shall be required to submit to the Board of Trustees no later than March 1 of each ~~ year a signed and notarized report which includes, but is not limited to, the following information: 1. Upon request of the Board of Trustees, a medical report from the disability retiree's physician stating whether the retiree is still totally incapacitated to perform the regular and continuous duties of a police officer or firefighter shall be submitted to the Board. The required physician's statement must be dated within four months of the request. 2. A statement showing the amount the disability retiree received in the immediately preceding calendar year from the following sources: a. Social security (primary insurance amount only, not including family benefits); b. Workers' compensation (excluding medical reimbursements); and c. Compensation for work performed during the year. Copies of all IRS W-2 forms from each employer shall be required for this purpose. (b) A statement to the effect that the disability retiree understands that if the report is incomplete or incorrect, his disability retirement benefits may be suspended or discontinued. (c) In the event that the required annual report is not submitted to the Board on a timely basis, or is incomplete or incorrect, the Board may, in its discretion, suspend o__r discontinue the disability retirement benefits. (7) Annual'benefit adjustments. (a) The monthly disability retirement benefit of each person who is receiving benefits on, or who shall receive benefits after, the effective date of this subchapter, shall be adjusted annually as described herein. First, the sum of the following items shall be calculated for the previous calendar year: - 5 - Ord. No. 17-93 1. The disability retirement benefits paid from the system; 2. The social security primary insurance amounts (not including family benefits), less any cost of living adjustments since the benefit first went into effect; 3. The workers' compensation disability benefits (excluding medical reimbursements), less any cost of living adjustments since the benefit first went into effect, to the extent that such benefits, when added to the member's disability retirement benefit from the system exceed the member's average monthly earnings on the date of disability; and 4. Any earned income (as defined in division (C) (11) of this section) received as evidenced by the IRS W-2 forms (excluding any sick and vacation pay received from the city pursuant to the disability, as determined by the Board of Trustees). (b) The annual rate of earnings of the disability retiree on his date of disability (utilizing the minimum set forth hereinafter) shall then be subtracted from this sum. If there is any excess of the sum over the sum of the disability retiree's predisability annual earnings rate (with a presumed minimum upon the effective date of this subchapter of $30,000) as increased or decreased annually by the city in accordance with the salary funded for comparably funded city positions, then the disability retirement benefit payable from the system shall be reduced. The amount of the annual reduction shall be equal to fifty percent (50%) of any sums up to and including $15,000 of the excess, plus one hundred percent (100%) of the excess, if any, which exceeds $15,000 in excess of the as-adjusted disability retiree's predisability annual earnings (with a presumed minimum upon the effective date of this subchapter of $30,000). The annual reduction so computed shall then be divided by twelve (12) to make it a monthly reduction. The monthly reduction shall then be subtracted from the monthly disability retirement benefit which has most recently been paid. If the sum of the four items listed above is less than the disability retirement benefit computed in accordance with division (C) (5) (b) or (c) of this section, as applicable, prior to the offset provided by (C) (5) (e)' of this section, then the disability retirement benefit payable from the system shall be increased. The amount of the annual increase shall be equal to the amount of the disability retirement benefit computed in accordance with division (C) (5) (b) or (c) of this section, as applicable, prior to the offset provided by division (C) (5) (e) of this section, minus the sum of the four items listed above. The annual increase so computed shall then be divided by twelve (12) to make it a monthly increase. The monthly increase shall then be added to the monthly disability retirement benefit which has most recently been paid. Any ~ newly adjusted disability retirement benefit shall be paid for the twelve (12) months beginning on the next January 1; however, the disability retiree may petition the Board no more than once annually during that 12-month period for a ~computation of those benefit adjustments, which the Board may elect to consider and grant based upon demonstrated exigent circumstances occurring to the disability retiree subsequent to the 'last benefit adjustment. Upon the death of the disability retiree prior to his recovery, the monthly benefit rate without any adjustments shall be used to compute any survivor benefits which are payable from the system. - 6 - Ord. No. 17-93 (8) Disability affidavit. No member otherwise eligible to receive disability benefits shall be paid those benefits unless and until that member files a disability affidavit with the Board on a form furnished by the Board. By the disability affidavit, the prospective retiree shall affirm that he is acquainted and familiar with the terms and conditions of his disability retirement. In particular, he shall acknowledge the authority of the Board to require him to undergo periodic future physical examinations in order to determine whether he has recovered from disability ~/~/~b~. (9) Authority for reexamination. Each person who first qualifies for or is then receiving disability retirement benefits on or after the effective date of this subchapter shall be subject to periodic reexamination by a medical board selected by the Board of Trustees to determine if the disability has ceased to exist. ~/~~//~/~//~/~m~//~ (10) Recovery from disability. (a) In the event a member who has been retired on a disability benefit regains his health and is able to perform his duties in the Police Department or Fire Department, the Board shall discontinue the pension; and further, the city shall, subject to budget and qualification of the member for the position, offer the member a position with the city as a police officer or firefighter. (b) If a member shall resume his employment with the city, as a police officer' or firefighter, then he may pay into the fund an amount equal to the aggregate contributions plus interest at a rate to be determined by the Board (computed upon his annual earnings at the time of his disability retirement) he would have been required to make hereunder, as determined by the Board, during the period of his disability retirement had he not been retired, and shall thereupon ~//~//~ receive creditable service for the period of the disability retirement. In any event, that member shall retain credit for the period of continuous service to the date of disability. (11) Earned income. For purposes of this section, "EARNED INCOME" shall mean all wages, salaries, tips and other employee compensation received by the member, plus the amount of the member's net earnings from self-employment for any tax year. (D) Preretirement death. (1) Service incurred. A death benefit shall be payable on behalf of any member who dies as a direct result of an occurrence arising in the performance of service. These benefits are not to be limiting to other benefits available under state law. The benefits shall be payable as follows: (a) To the spouse, until the earlier of death or remarriage, a monthly benefit equal to fifty percent (50%) of the member's average monthly earnings; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the actuarial equivalent of a lifetime benefit payable to the member in the amount of fifty percent (50%) of the member's average monthly earnings at date of death, plus - 7 - Ord. No. 17-93 (b) 1. For each unmarried child until he or she shall have reached the age of eighteen (18) years, and for each unmarried child from age 18 until age 22 who is a full-time student in a fully accredited high school, college or university, there shall be paid in equal monthly installments, an amount equal to five percent (5%) of the average monthly earnings subject to an overall limitation of a total of sixty percent (60%) of average monthly earnings for the spouse and children combined. The nonstudent child's pension shall terminate on the earlier of death, marriage or the attainment of age 18i. ~The pension of a child who is a student shall terminate on the earlier of death, marriage or the attainment of age 22. Legally adopted children shall be eligible the same as natural children. 2. Upon remarriage or death of the spouse, the five percent (5%) child allowance shall be increased to ten percent (10%) for each child, not to exceed a combined total of thirty-five percent (35%) of the member's average monthly earnings. The trusteeship and disbursements of the pension to any child shall be determined by the Board of Trustees. (2) Nonservice incurred. If any member shall die in active service from causes not attributable to active duty or service, a death benefit shall be payable as follows: (a) With less than one year of continuous service, a single sum amount of $2,500 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be. (b) With one but less than five years of continuous service, a single sum amount of $5,000 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be. (c) With five or more years of continuous service: 1. A single sum amount of $5,000 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be, plus 2. To the spouse until remarriage or death, in equal monthly payments, a pension equal to sixty-five percent (65%) of that member's accrued pension as of date of death, subject to a minimum of twenty percent (20%) of average monthly earnings; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the actuarial equivalent of a lifetime benefit payable to the member in the amount of sixty-five percent (65%) of such member's accrued pension as of date of death, plus 3. To the child of the deceased member, the same benefits as are payable by reason of service incurred death, subject however, to a maximum combined limitation of monthly payments to the spouse and children of fifty percent (50%) of average monthly earnings and thirty-five percent (35%) after remarriage or death of spouse. (3) In the event more than one beneficiary is designated by the member, the death benefits provided in this section shall be apportioned equally among the beneficiaries. - 8 - Ord. No. 17-93 (E) Vesting. (1) If a member terminates his employment with the Police or Fire Departments, either voluntarily or by lawful discharge, and is not eligible for any other benefits under this system, he shall be entitled to the following: (a) With less than ten years of continuous service, refund of member contributions. (b) With ten or more years of continuous service: 1. The pension benefit accrued to his date of termination, payable commencing on the date which would have been his earliest normal retirement date had he remained in employment, provided he does not elect to withdraw his member contributions, or 2. Refund of member contributions. (2) Any member of this system who, for whatever reason, has his employment with the city as a police officer or firefighter terminated, but who remains with or was previously employed by the city in some other capacity so that his total period of employment with the city is ten years or more, shall have all benefits accrued under this system preserved, provided he does not elect to withdraw his member contributions. These accrued benefits shall be payable at his otherwise normal retirement date, in accordance with the provisions of this system. For purposes of determining normal retirement date under this vesting provision, continuous service shall include all continuous employment with the city as an employee as herein defined as well as the period of time subsequent to termination as a member of this system; however, benefits shall not be payable under this system during any period of continued employment by the city. Upon the written election of the Police Chief or Fire Chief not to participate in the system, the employment of the Police Chief or Fire Chief shall be deemed terminated for the purpose of applying the provisions of this system. A Police Chief or Fire Chief who terminates his participation in this system shall not thereafter be eligible to receive benefits through this system while actively employed by the city. (F) Application of section. The provisions set forth herein shall be applicable to all current and future members of the plan, including members now receiving or who have applied for disability retirement benefits (except that these applicants and members receiving disability benefits shall not be subject to the provisions set forth in division (C) (1), (2) or (4) of this section above, as well as the earned income benefit offsets otherwise provided for herein). (G) Maximum benefits. A member may not receive a pension or disability benefit which exceeds the lesser of: (1) One hundred percent (100%) of the member's average compensation for the highest three consecutive years as a member in the pension fund; or (2) The maximum amount allowed under Section 415 of the Internal Revenue Code (increased to reflect the cost of living adjustment factor prescribed under Section 415(d) of the Internal Revenue Code), which is incorporated herein by reference. - 9 - Ord. No. 17-93 (H) Required payment of pension benefits. Pension benefits shall begin no later than April 1 of the calendar year following the calendar year in which the member retires, or in which the member attains age 70-1/2, even if the member has not filed a claim for pension benefits. In addition, payment of benefits shall be made in accordance with the applicable provisions of Section 401(a) (9) of the Internal Revenue Code, which is incorporated herein by reference. Section 2. That should any section or provision of this ordinance or any portion thereof, any paragraph, sentence or word be declared by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remainder hereof as a whole or part thereof other than the part declared to be invalid. Section 3. That all ordinances or parts of ordinances which are in conflict herewith be and the same are hereby repealed. Section 4. That this ordinance shall become effective immediately upon passage on second and final reading. PASSED AND ADOPTED in regular session on second and final reading on this the 10th day of March , 1993. ATTEST: ~ City,Clerk ' First Reading February 9, 1993 Second Reading March 10, 1993 - 10 - Ord. No. 17-93 MEMORANDUM TO: MAYOR AND CITY COMMISSIONERS FROM: CITY MANAGER SUBJECT: AGENDA ITEM ~ }~ - MEETING OF MARCH 10. 1993 ORDINANCE NO. 17-93 DATE: March 5, 1993 This is second reading of an ordinance amending Chapter 33 of the Code of Ordinances relative to Police and Fire Pension issues to provide for certain grammatical and verbiage changes. This proposed ordinance seeks to clarify Section 33.62, "Benefit Amounts and Eligibility". There are no substantive changes relating to benefit amounts, offsets or eligibility incorporated into this ordinance. Both the City Attorney's Office and Board of Trustees have reviewed these changes. At the February 9th regular meeting, Ordinance No. 17-93 was passed on first reading by a vote of 5-0. Recommend approval of Ordinance No. 17-93 on second and final reading. ORDINANCE NO. 17-93 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AMENDING TITLE III, "ADMINISTRATION", CHAPTER 33, "POLICE AND FIRE DEPARTMENTS", SUBHEADING "PENSIONS", OF THE CODE OF ORDINANCES OF THE CITY OF DELRAY BEACH, FLORIDA, BY AMENDING SECTION 33.62, "BENEFIT AMOUNTS AND ELIGIBILITY", TO PROVIDE FOR CERTAIN GRAMMATICAL AND VERBIAGE CHANGES; PROVIDING A SAVING CLAUSE, A GENERAL REPEALER CLAUSE, AND AN EFFECTIVE DATE. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AS FOLLOWS: Section 1. That Title III, "Administration", Chapter 33, "Police and Fire Departments", Subheading "Pensions", Section 33.62, "Benefit Amounts and Eligibility", of the Code of Ordinances of the City of Delray Beach, Florida, be, and the same is hereby amended to read as follows: Section 33.62 BENEFIT AMOUNTS AND ELIGIBILITY. (A) Normal retirement date. ~//~//~//~//~ ~/~//~//f~//~//~f/~//~//~f//~~/l~//~ f~II~/~/l~m~/l~f/l~/f~f~~ll~~ll~//~ ~m~l~fll~W~l~Z~ll~l~fll~~l~6~ll~W~9~ ~/I~/Ig~9~/~/~/m~/~//~/~/~/~/f~/~//~f ~/~//~~//~/~//~*~//f6II~W~/h~//~~//~f ~b~/I~/Ig~9l This term shall have the following meanings: 1. For employees who are eligible to become members of the system as of its effective date, the normal retirement date shall be the date of their fifty-second birthday, regardless of the number of years of continuous service. 2. For employees who are members of the system and terminate employment prior to October 1, 1989, the normal retirement date shall be the first day of the month coincident with or subsequent to their fifty-second birthday and the completion of twenty (20) years of continuous service. 3. For employees who are members of the system and elect to retire or terminate employment on or subsequent to October 1, 1989, the normal retirement date shall be the first day of the month coincident with or subsequent to completion of twenty (20) years of continuous service. (B) Normal retirement benefit. (1) Duration, survivor benefits. A member retiring ~~ on his normal retirement date shall receive a monthly benefit which shall commence on his normal retirement date and be continued thereafter during his lifetime~ ~_Upon his death the full retirement benefit shall be continued to his spouse for one year and sixty percent (60%) of that amount continued thereafter until the earlier of death or remarriage. (2) Amount. Normal retirement benefits shall be in the amount of two and one-half percent of average monthly earnings for each year of continuous service, subject ~/~//~9~ to a maximum of seventy-five percent (75%) of average monthly earningsi~ ~owever, members as of the effective date shall receive at their normal retirement date (age 52 regardless of years of service) the greater of the benefit provided by the formula above or fifty percent (50%) of average monthly earnings. (3) Upon becoming eligible for normal retirement, a member shall be one hundred percent (100%) vested in his accrued benefit. (C) Disability retirement provisions. (1) (a) For purposes of this system, "TOTAL AND PERMANENT DISABILITY" shall mean an injury, disease or condition which totally and permanently incapacitates a member, either physically or mentally, from his regular and continuous duty as a police officer or firefighter. A "TOTAL AND PERMANENT DISABILITY" arising directly from the performance of service to the city by a member as a police officer or firefighter shall be considered to be a service incurred disability. A "TOTAL AND PERMANENT DISABILITY" arising from any other cause or source, other than as modified below, shall be considered to be a nonservice incurred disability. A member shall not be entitled to receive a disability retirement benefit from the system if the disability is a result of: 1. Excessive and habitual use of drugs, intoxicants or narcotics; 2. Injury or disease sustained by the member while willfully and illegally participating in fights, riots, civil insurrections, or while committing a crime; 3. Injury or disease sustained by a member while serving in any of the armed forces; 4. Injury or disease sustained by the member after his employment with the city has been terminated. (b) A member shall not receive a service incurred disability benefit for injury or disease sustained by the member while working (either as an employee or through some other contractual arrangement) for anyone other than the city, performing a job function the same as or related to the member's city job function, and arising out of the scope of any other employment or contractual arrangement, excepting injuries sustained by members while performing duties on behalf of the city and while within the city's jurisdiction although those injuries occurred at an outside employer's job site. In addition, a member shall not be entitled to receive a disability retirement benefit from the system on the basis of any condition which existed prior to the member's employment or which was evidenced during the member's preemployment physical. (2) Application for benefits. In order for the Board to consider a member's request for disability retirement benefits, the member must apply in writing to the Board. T~ - 2 - Ord. No. 17-93 B~ Upon receipt of proper application by the Board of Trustees, the Board of Trustees shall arrange for a physical examination of the applicant by the medical board. A further condition for receipt of disability retirement benefits from the system is that the applicant must apply for and diliqently pursue disability benefits from social security and workers' compensation. Written proof of application must be submitted to the Board of Trustees. Failure of the applicant to qualify as being disabled under either the social security or workers' compensation laws may be considered by the Board of Trustees in review ~/~~~ ~/~/~//~f/~~ of that member's ~b~//~~ application or recovery from disability. (3) Medical board. When a member submits proper application for a disability retirement benefit, the Board of Trustees shall designate a medical board to be composed of at least one b~/~/m~/~//~ physician~. ~/~/~f ~~ medical board shall arrange for and pass upon all medical examinations required under the provisions of this subchapter, shall investigate all essential statements or certificates made by or on behalf of a member in connection with an application for disability retirement and shall report in writing to the Board of Trustees its conclusions and recommendations upon all matters referred to it. The payment of those services shall be determined by the Board of Trustees. (4) Determination of disability. All questions relating to eligibility for initial payment or continuance of disability benefits shall be determined by the Board of Trustees, taking into consideration the recommendations of the medical board and any other evidence of which the Board of Trustees may avail itself. The general steps which the Board of Trustees shall follow in its determination shall be as listed below, provided however, that the Board of Trustees may, in its discretion, alter or modify these steps: (a) Determine whether the member's application is proper~ ~/~I~ (b) If application is for a nonservice incurred disability, determine whether the ten years of continuous service requirement has been met. (c) Based on all evidence submitted to the Board of Trustees, determine whether the applicant satisfies the definition of disability, including the absence of listed exclusions. (d) Determine whether the disability is to be considered a service incurred disability or a nonservice disability, taking into consideration F.S. Chapters 175.231 and 185.34. (e) Establish a date of disability. This date may be the date of injury causing the disability, the date when the member could no longer perform his regular and continuous duties, the date when his sick pay and vacation pay are exhausted or such other date as determined by the Board of Trustees. - 3 - Ord. No. 17-93 (5) Disability retirement benefits. (a) Eligibility. Each ~I member~ ~ shall be eligible for service incurred disability benefits, regardless of ~ length of continuous service. Each member who completes ten (10) years of continuous service prior to becoming disabled shall be eligible for nonservice incurred disability benefits. (b) Initial amount of service incurred disability benefit. Seventy-five percent (75%) of the member's average monthly earnings in effect on the date of disability, subject in any event to the offsets listed below. (c) Initial amount of nonservice incurred disability benefit. W~/~I~I~//~T_wo percent (2%) of average monthly earnings in effect on the date of disability for each year of continuous service, subject in any event to maximum fifty percent (50%) of average monthly earnings and subject further to the offsets listed below. (d) Terms of payments. Disability benefits shall commence on or as of the first day of the month coincident with or next following the date of disability, as established by the Board of Trustees, and shall continue to be paid on the first day of each subsequent month until the death or recovery of the disability retiree. The same survivorship percentages which apply to normal retirement benefits shall also apply to disability retirement benefits. (e) Benefit offsets. Disability retirement benefits described above shall be reduced by aDy disability benefits paid by social security, by workers' compensation benefits to the extent such benefits when added to the member's disability retirement benefit from the system exceed the member's average monthly earnings on the date of disability, and by other benefit offsets set forth in division (C) (7) of this section. The reduction for social security shall be in the amount of the primary insurance amount only, not including any family benefit. Any cost of living adjustments in the disability retiree's social security and workers' compensation benefits shall not serve to reduce further the disability benefit payable from the system. The reduction for social security disability benefits shall terminate upon the retiree's attainment of age sixty-five (65). In the case of a lump sum settlement paid by workers' compensation, the disability retirement benefit payable from the system shall be adjusted as follows: 1. The amount of the lump sum settlement shall be divided by the member's remaining life expectancy (in months), as determined using standard actuarial tables approved by the plan actuary; 2. If the number obtained in division 1. above, when added to the member's monthly disability retirement benefit from the system, exceeds the member's average monthly earnings on the date of disability, the amount of the excess shall be deducted from the member's monthly disability retirement benefit from the system, for the duration of the member's remaining life expectancy as determined in division 1. above. - 4 - Ord. No. 17-93 3. If the number obtained in division 1. above, when added to the member's monthly disability retirement benefit from the system, does not exceed the member's average monthly earnings on the date of disability, there shall be no reduction of the member's disability retirement benefits from the system. Once the number of months of suspension has been completed, the disability retirement benefit from the system shall be resumed. Additional benefit adjustments shall also apply as described below in division (C) (7) of this section. (f) Eligibility for other benefits. In the event that a member applying for disability benefits is also eligible for either early or normal retirement, the Board may, upon the request of the member, pay the early or normal retirement benefit instead of a disability retirement benefit. (6) Annual report by disability retiree. (a) Each person currently receiving disability retirement benefits and each person who first qualifies for disability retirement benefits shall be required to submit to the Board of Trustees no later than March 1 of each ~~ year a signed and notarized report which includes, bu~ is not limited to, the following information: 1. Upon request of the Board of Trustees, a medical report from the disability retiree's physician stating whether the retiree is still totally incapacitated to perform the regular and continuous duties of a police officer or firefighter shall be submitted to the Board. The required physician's statement must be dated within four months of the request. 2. A statement showing the amount the disability retiree received in the immediately preceding calendar year from the following sources: a. Social security (primary insurance amount only, not including family benefits); b. Workers' compensation (excluding medical reimbursements); and c. Compensation for work performed during the year. Copies of all IRS W-2 forms from each employer shall be required for this purpose. (b) A statement to the effect that the disability retiree understands that if the report is incomplete or incorrect, his disability retirement benefits may be suspended or discontinued. (c) In the event that the required annual report is not submitted to the Board on a timely basis, or is incomplete or incorrect, the Board may, in its discretion, suspend o__r discontinue the disability retirement benefits. (7) Annual benefit adjustments. (a) The monthly disability retirement benefit of each person who is receiving benefits on, or who shall receive benefits after, the effective date of this subchapter, shall be adjusted annually as described herein. First, the sum of the following items shall be calculated for the previous calendar year: - 5 - Ord. No. 17-93 1. The disability retirement benefits paid from the system; 2. The social security primary insurance amounts (not including family benefits), less any cost of living adjustments since the benefit first went into effect; 3. The workers' compensation disability benefits (excluding medical reimbursements), less any cost of living adjustments since the benefit first went into effect, to the extent that such benefits, when added to the member s disability retirement benefit from the system exceed the member s average monthly earnings on the date of disability; and 4. Any earned income (as defined division (C) (11) of this section) received as evidenced by the IRS W-2 forms (excluding any sick and vacation pay received from the city pursuant to the disability, as determined by the Board of Trustees). (b) The annual rate of earnings of the disability retiree on his date of disability (utilizing the minimum set forth hereinafter) shall then be subtracted from this sum. If there is any excess of the sum over the sum of the disability retiree's predisability annual earnings rate (with a presumed minimum upon the effective date of this subchapter of $30,000) as increased or decreased annually by the city in accordance with the salary funded for comparably funded city positions, then the disability retirement benefit payable from the system shall be reduced. The amount of the annual reduction shall be equal to fifty percent (50%) of any sums up to and including $15,000 of the excess, plus one hundred percent (100%) of the excess, if any, which exceeds $15,000 in excess of the as-adjusted disability retiree's predisability annual earnings (with a presumed minimum upon the effective date of this subchapter of $30,000). The annual reduction so computed shall then be divided by twelve (12) to make it a monthly reduction. The monthly reduction shall then be subtracted from the monthly disability retirement benefit which has most recently been paid. If the sum of the four items listed above is less than the disability retirement benefit computed in accordance with division (C) (5) (b) or (c) of this section, as applicable, prior to the offset provided by (C) (5) (e) of this section, then the disability retirement benefit payable from the system shall be increased. The amount of the annual increase shall be equal to the amount of the disability retirement benefit computed in accordance with division (C) (5) (b) or (c) of this section, as applicable, prior to the offset provided by division (C) (5) (e) of this section, minus the sum of the four items listed above. The annual increase so computed shall then be divided by twelve (12) to make it a monthly increase. The monthly increase shall then be added to the monthly disability retirement benefit which has most recently been paid. Any ~ newly adjusted disability retirement benefit shall be paid for the twelve (12) months beginning on the next January 1; however, the disability retiree may petition the Board no more than once annually during that 12-month period for a ~computation of those benefit adjustments, which the Board may elect to consider and grant based upon demonstrated exigent circumstances occurring to the disability retiree subsequent to the last benefit adjustment. Upon the death of the disability retiree prior to his recovery, the monthly benefit rate without any adjustments shall be used to compute any survivor benefits which are payable from the system. - 6 - Ord. No. 17-93 (8) Disability affidavit. No member otherwise eligible to receive disability benefits shall be paid those benefits unless and until that member files a disability affidavit with the Board on a form furnished by the Board. By the disability affidavit, the prospective retiree shall affirm that he is acquainted and familiar with the terms and conditions of his disability retirement. In particular, he shall acknowledge the authority of the Board to require him to undergo periodic future physical examinations in order to determine whether he has recovered from disability ~/~I/~b~. (9) Authority for reexamination. Each person who first qualifies for or is then receiving disability retirement benefits on or after the effective date of this subchapter shall be subject to periodic reexamination by a medical board selected by the Board of Trustees to determine if the disability has ceased to exist. ~l~m~ll~II~ll~l~m~ll~ ~f~/~/~W~/~l~/~I~/~ (10) Recovery from disability. (a) In the event a member who has been retired on a disability benefit regains his health and is able to perform his duties in the Police Department or Fire Department, the Board shall discontinue the pension; and further, the city shall, subject to budget and qualification of the member for the position, offer the member a position with the city as a police officer or firefighter. (b) If a member shall resume his employment with the city, as a police officer or firefighter, then he may pay into the fund an amount equal to the aggregate contributions plus interest at a rate to be determined by the Board (computed upon his annual earnings at the time of his disability retirement) he would have been required to make hereunder, as determined by the Board, during the period of his disability retirement had he not been retired, and shall thereupon ~//~6~//~ receive creditable service for the period of the disability retirement. In any event, that member shall retain credit for the period of continuous service to the date of disability. (11) Earned income. For purposes of this section, "EARNED INCOME" shall mean all wages, salaries, tips and other employee compensation received by the member, plus the amount of the member's net earnings from self-employment for any tax year. (D) Preretirement death. (1) Service incurred. A death benefit shall be payable on behalf of any member who dies as a direct result of an occurrence arising in the performance of service. These benefits are not to be limiting to other benefits available under state law. The benefits shall be payable as follows: (a) To the spouse, until the earlier of death or remarriage, a monthly benefit equal to fifty percent (50%) of the member's average monthly earnings; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the actuarial equivalent of a lifetime benefit payable to the member in the amount of fifty percent (50%) of the member's average monthly earnings at date of death, plus - 7 - Ord. No. 17-93 (b) 1. For each unmarried child until he or she shall have reached the age of eighteen (18) years, and for each unmarried child from age 18 until age 22 who is a full-time student in a fully accredited high school, college or university, there shall be paid in equal monthly installments, an amount equal to five percent (5%) of the average monthly earnings subject to an overall limitation of a total of sixty percent (60%) of average monthly earnings for the spouse and children combined. The nonstudent child's pension shall terminate on the earlier of death, marriage or the attainment of age 18t. ~The pension of a child who is a student shall terminate on the earlier of death, marriage or the attainment of age 22. Legally adopted children shall be eligible the same as natural children. 2. Upon remarriage or death of the spouse, the five percent (5%) child allowance shall be increased to ten percent (10%) for each child, not to exceed a combined total of thirty-five percent (35%) of the member's average monthly earnings. The trusteeship and disbursements of the pension to any child shall be determined by the Board of Trustees. (2) Nonservice incurred. If any member shall die in active service from causes not attributable to active duty or service, a death benefit shall be payable as follows: (a) With less than one year of continuous service, a single sum amount of $2,500 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be. (b) With one but less than five years of continuous service, a single sum amount of $5,000 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be. (c) With five or more years of continuous service: 1. A single sum amount of $5,000 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be, plus 2. To the spouse until remarriage or death, in equal monthly payments, a pension equal to sixty-five percent (65%) of that member's accrued pension as of date of death, subject to a minimum of twenty percent (20%) of average monthly earnings; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the actuarial equivalent of a lifetime benefit payable to the member in the amount of sixty-five percent (65%) of such member's accrued pension as of date of death, plus 3. To the child of the deceased member, the same benefits as are payable by reason of service incurred death, subject however, to a maximum combined limitation of monthly payments to the spouse and children of fifty percent (50%) of average monthly earnings and thirty-five percent (35%) after remarriage or death of spouse. (3) In the event more than one beneficiary is designated by the member, the death benefits provided in this section shall be apportioned equally among the beneficiaries. - 8 - Ord. No. 17-93 (E) Vesting. (1) If a member terminates his employment with the Police or Fire Departments, either voluntarily or by lawful discharge, and is not eligible for any other benefits under this system, he shall be entitled to the following: (a) With less than ten years of continuous service, refund of member contributions. (b) With ten or more years of continuous service: 1. The pension benefit accrued to his date of termination, payable commencing on the date which would have been his earliest normal retirement date had he remained in employment, provided he does not elect to withdraw his member contributions, or 2. Refund of member contributions. (2) Any member of this system who, for whatever reason, has his employment with the city as a police officer or firefighter terminated, but who remains with or was previously employed by the city in some other capacity so that his total period of employment with the city is ten years or more, shall have all benefits accrued under this system preserved, provided he does not elect to withdraw his member contributions. These accrued benefits shall be payable at his otherwise normal retirement date, in accordance with the provisions of this system. For purposes of determining normal retirement date under this vesting provision, continuous service shall include all continuous employment with the city as an employee as herein defined as well as the period of time subsequent to termination as a member of this system; however, benefits shall not be payable under this system during any period of continued employment by the city. Upon the written election' of the Police Chief or Fire Chief not to participate in the system, the employment of the Police Chief or Fire Chief shall be deemed terminated for the purpose of applying the provisions of this system. A Police Chief or Fire Chief who terminates his participation in this system shall not thereafter be eligible to receive benefits through this system while actively employed by the city. (F) Application of section. The provisions set forth herein shall be applicable to all current and future members of the plan, including members now receiving or who have applied for disability retirement benefits (except that these applicants and members receiving disability benefits shall not be subject to the provisions set forth in division (C) (1), (2) or (4) of this section above, as well as the earned income benefit offsets otherwise provided for herein). (G) Maximum benefits. A member may not receive a pension or disability benefit which exceeds the lesser of: (1) One hundred percent (100%) of the member's average compensation for the highest three consecutive years as a member in the pension fund; or (2) The maximum amount allowed under Section 415 of the Internal Revenue Code (increased to reflect the cost of living adjustment factor prescribed under Section 415(d) of the Internal Revenue Code), which is incorporated herein by reference. - 9 - Ord. No. 17-93 (H) Required payment of pension benefits. Pension benefits shall begin no later than April 1 of the calendar year following the calendar year in which the member retires, or in which the member attains age 70-1/2, even if the member has not filed a claim for pension benefits. In addition, payment of benefits shall be made in accordance with the applicable provisions of Section 401(a) (9) of the Internal Revenue Code, which is incorporated herein by reference. Section 2. That should any section or provision of this ordinance or any portion thereof, any paragraph, sentence or word be declared by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remainder hereof as a whole or part thereof other than the part declared to be invalid. Section 3. That all ordinances or parts of ordinances which are in conflict herewith be and the same are hereby repealed. Section 4. That this ordinance shall become effective immediately upon passage on second and final reading. PASSED AND ADOPTED in regular session on second and final reading on this the __ day of , 1993. MAYOR ATTEST: City Clerk First Reading Second Reading - 10 - Ord. No. 17-93 ..... !..:~ ' ~ 05 F:'.O1 [-:ITY_ ATTI3RNEY $ OFFIFF.__ TEL I",lo. 407 ,:,'8 ~7. ~., Hat' I'-:lS 1._,: DELRFI¥ BEFICH ' " CITY ATTOFINEY'$ OFFICE FACSIMII,E200 NW 1st 40'//278-4755AVENUE' DELR'a'Y BEACH, FLOR1D/~ 33444 FAX TRANSMITTAL LETTER FIRM: · :r of pages {including covor ~heet) CIT~ ATTORNEY'S OFF~CE CITY OF DEL~Y BEACH, FLORIDA Transmittal on KONIMAIL 200. Our FAX # is (407) 278-4755 IF ANY OF THE PAGES ARE NOT CLEARLY RECEIVED, PLEASE CAL!~ (407) 243-7090 IMMEDIATELY. COMMENTS: CITY ,qTTORNEY $ OFFICE T-EL No, 4.07 278 i:ITY OF DELRflY BEACH " CITY ATTORNEY'S OFFICE ( o7) MF~ MORANDUM Dates March 5, 1993 To: David T. Harden, City Manager From: David N. Tolces, Assistant City Attorne~L~ Subjects Revisions to the Police and Fire Pension Plan i reviewed your revisions to the Police and Fire Pension Ordinance. My only remaining concern is Section 33.62(A) regarding "Normal Retirement Date." I drafted the following proposed revision which I think might clear up the difficulties encountered when reading the existing paragraph: (A) Normal Retirement Date. This term shall have the · following meanings: 1. '--~or employees who are eligible to becom~ members of the system as of its effective date, the normal retirement date shall be the date of their fifty-second birthday, regardless of the number of years of continuous ervtce. 2. For employees who are members of the ~¥~t~m and terminate employment prior to October 1, 1989, the normal retirement date shall be the first day of the month coincident with or subsequent to their fifty-second birthday and the completion of twenty (20) years of continuous service. 3. For employees who ~re members of the system and elect to retire or terminate employment on or subsequent to October 1, 1989, the normal retirement date shall be the first day of the month coincident with or suDsequent to completion of twenty years of continuous service. I have no problem with your other 'Suggested revisions. Let me know what you think of my suggestion. DNT: s h ~~',~~1~ CITY OF DELRAY BE~ TO: /~{X. ,,t/~ DATE: ,,..~/,...~/g'~ SU BJ: ORDINANCE NO. 17-93 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AMENDING TITLE III, "ADMINISTRATION", CHAPTER 33, "POLICE AND FIRE DEPARTMENTS", SUBHEADING "PENSIONS", OF THE CODE OF ORDINANCES OF THE CITY OF DELRAY BEACH, FLORIDA, BY AMENDING SECTION 33.62, "BENEFIT AMOUNTS AND ELIGIBILITY", TO PROVIDE FOR CERTAIN GRAMMATICAL AND VERBIAGE CHANGES; PROVIDING A SAVING CLAUSE, A GENERAL REPEALER CLAUSE, AND AN EFFECTIVE DATE. NOW, THERBFORB, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AS FOLLOWS: Section 1. That Title III, "Administration", Chapter 33, "Police and Fire Departments", Subheading "Pensions", Section 33.62, "Benefit Amounts and Eligibility", of the Code of Ordinances of the City of Delray Beach, Florida, be, and the same is hereby amended to read as follows: Section 33.62 BENEFIT AMOUNTS AND ELIGIBILITY. (A) Normal retirement date. ~ ~mber ...~" clcot t~ rc _ire _~ ~ ~mplo~s who are eligible Z~ and become members of the system as of ~ffective date Jf thiu ~-zt&~shall be eligible to retire, ~, upon the attainment of their fifty-second birthday, regardless of the number of years of continuous service. Effective October 1, 1989, a member may elect to retire on the first day of any month coincident with or next following4~- completion of twenty (2~) years of continuous service. ~h~ ~r&vis£cn &hall max m~T~--~ny member wbo~ ~eti~es or~ter~i~ages employm..egt prior, ~ .'~--~>~ ~/'~6o~mal ret~irement benefit, c~ (1) Duration, survivor benefits. A member retiring ~ on his normal retirement date shall receive a monthly benefit which shall commence on his normal.retirement date and be continued thereafter during his lifetimeS, ~on his death the full retirement benefit shall be continued ~o his spouse for one year and sixty percent (60%) of that amount continued thereafter until the earlier of death or remarriage. (2) Amount. Normal retirement benefits shall be in the amount of two and one-half percent of average monthly earnings for each year of continuous service, subject ~ ~ to a maxim,qm of seventy-five percent (75%) of average monthly earning~.~owever, members as of the effective date shall receive at their normal retirement date (age 52 regardless of years of service) the greater of the benefit provided by the formula above or fifty percent (50%) of average monthly earnings. (3) Upon becoming eligible for normal retirement, a member shall be one hundred percent (100%) vested in his accrued benefit. (10) Recovery from disability. (a) In the event a member who has been retired on a disability benefit regains his health and is able to perform his duties in the Police Department or Fire Department, the Board shall discontinue the pension; and further, the city shall, subject to budget and qualification of the member for the position, offer the member a position with the city as a police officer or firefighter. (b) If a member shall resume his employment with the city, as a police officer or firefighter, then he may pay into the fund an amount equal to the aggregate contributions plus interest at a rate to be determined by the Board (computed upon his annual earnings at the time of his disability retirement) he would have been required to make hereunder, as determined by the Board, during the period of his disability retirement had he not been retired, and shall thereupon Z~//~//~ receive creditable service for the period of the disability retirement. In any event, that member shall retain credit for the period of continuous service to the date of disability. (11) Earned income. For purposes of this section, "EARNED INCOME" shall mean all wages, salaries, tips and other employee compensation received by the member, plus the amount of the member's net earnings from self-employment for any tax year. (D) Preretirement death. (1) Service incurred. A death benefit shall be payable on behalf of any member who dies as a direct result of an occurrence arising in the performance of service. These benefits are not to be limiting to other benefits available under state law. The benefits shall be payable as follows: (a) To the spouse, until the earlier of death or remarriage, a monthly benefit equal to fifty percent (50%) of the member's average monthly earnings; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the/~uarial equivalent of a lifetime benefit payable to the membe= ih~he amount of fifty percent (50%) of the member's average month~arnings at date of death, plus (b) 1. For each unmarried child until he or she shall have reached the age of eighteen (18) years, and for each unmarried child from age 18 until age 22 who is a full-time student in a fully accredited high school, college or university, there shall be paid in equal monthly installments, an amount equal to five percent (5%) of the average monthly earnings subject to an overall limitation of a total of sixty percent (60%) of average monthly earnings for the spouse and children combined. The nonstudent child's pension shall term~te on the earlier of death, marriage or the attainment of age l~he pension of a child who is a student shall terminate on the earlier of death, marriage or the attainment of age 22. Legally adopted children shall be eligible the same as natural children. 2. Upon remarriage or death of the spouse, the five percent (5%) child allowance shall be increased to ten percent (10%) for each child, not to exceed a combined total of thirty-five percent (35%) of the member's average monthly earnings. The trusteeship and disbursements of the pension to any child shall be determined by the Board of Trustees. - 7 - Ord. No. 17-93 (2) Any member of this system who, for whatever reason, has his employment with the city as a police officer or firefighter terminated, but who remains with or was previously employed by the city in some other capacity so that his total period of employment with the city is ten years or more, shall have all benefits accrued under this system preserved, provided he does not elect to withdraw his member contributions. These accrued benefits shall be payable at his otherwise normal retirement date, in accordance with the provisions of this system. For purposes of determining normal retirement date under this vesting provision, continuous service shall include all continuous employment with the city as an employee as herein defined as well as the period of time subsequent to termination as a member of this system; however, benefits shall not be payable under this system during any period of continued employment by the city. Upon the written election of the Police'~ Chief or Fire Chief shall be deemed terminated for the purpose of applying the provisions of this system. A Police Chief or Fire~ Chief who terminates his participation in this system shall not thereafter be eligible to receive benefits through this system while actively employed by the city. (F) Application of section. The provisions set forth herein shall be applicable to all current and future members of the plan, including members now receiving or who have applied for disability retirement benefits (except that these applicants and members receiving disability benefits shall not be subject to the provisions set forth in division (C) (1), (2) or (4) of this section above, as well as the earned income benefit offsets otherwise provided for herein). (G) Maximum benefits. A member may not receive a pension or disability benefit which exceeds the lesser of: (1) One hundred percent (100%) of the member's average compensation for the highest three consecutive years as a member in the pension fund; or (2) The maximum amount allowed under Section 415 of the Internal Revenue Code (increased to reflect the cost of living adjustment factor prescribed under Section 415(d) of the Internal Revenue Code), which is incorporated herein by reference. (H) Required payment of pension benefits. Pension benefits shall begin no later than April 1 of the calendar year following the calendar year in which the member retires, or in which the member attains age 70-1/2, even if the member has not filed a claim for pension benefits. In addition, payment of benefits shall be made in accordance with the applicable provisions of Section 401(a) (9) of the Internal Revenue Code, which is incorporated herein by reference.. Section 2. That should any section or provision of this ordinance or any portion thereof, any paragraph, sentence or word be declared by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remainder hereof as a whole or part thereof other than the part declared to be invalid. Section 3. That all ordinances or parts of ordinances which are in conflict herewith be and the same are hereby repealed. Section 4. That this ordinance shall become effective immediately upon passage on second and final reading. - 9 - Ord. No. 17-93 MEMORANDUM TO: MAYOR AND CITY COMMISSIONERS FROM: CITY MANAGER~.~// SUBJECT: AGENDA ITEM # /0' D' - MEETING OF FEBRUARY 23. 1999 ORDINANCE NO. 17-93 DATE: February 19, 1993 This is second reading of an ordinance amending Chapter 33 of the Code of Ordinances relative to Police and Fire Pension issues to provide for certain gammatical and verbiage changes. This proposed ordinance seeks to clarify Section 33.62, "Benefit Amounts and Eligibility". There are no substantive changes relating to benefit amounts, offsets or eligibility incorporated into this ordinance. Both the City Attorney's Office and Board of Trustees have reviewed these changes. At the February 9th regular meeting, Ordinance No. 17-93 was passed on first reading by a vote of 5-0. I will be meeting with the City Attorney and Finance Director on Tuesday afternoon, February 23, 1993, to further review this item. Any additional information or recommendations will be reported at Tuesday evening's meeting. Recommend approval of Ordinance No. 17-93 on second and final reading. ORDINANCE NO. 17-93 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF DELI{AY BEACH, FLORIDA, AMENDING TITLE III, "ADMINISTRATION", CHAPTER 33, "POLICE AND FIRE DEPARTMENTS", S~BHEADING "PENSIONS", OF THE CODE OF ORDINANCES OF THE CITY OF DELRAY BEACH, FLORIDA, BY AMENDING SECTION 33.62, "BENEFIT AMOUNTS AND ELIGIBILITY", TO PROVIDE FOR CERTAIN GRAMMATICAL AND VERBIAGE CHANGES; PROVIDING A SAVING CLAUSE, A GENERAL REPEALER CLAUSE, AND AN EFFECTIVE DATE. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AS FOLLOWS: Section 1. That Title III, "Administration", Chapter 33, "Police and Fire Departments", Subheading "Pensions", Section 33.62, "Benefit Amounts and Eligibility", of the Code of Ordinances of the City of Delray Beach, Florida, be, and the same is hereby amended to read as follows: Section 33.62 BENEFIT AMOUNTS AND ELIGIBILITY. (A) Normal retirement date. A member may elect to retire on the first day of any month if coincident with or following the attainment of his fifty-second birthday and the completion of twenty (20) years of continuous service; however, employees who are eligible ~ and become members of the system as of the effective date of this system shall'be eligible to retire, as above, upon the attainment of their fifty-second birthday, regardless of the number of years of continuous service. Effective October 1, 1989, a member may elect to retire on the first day of any month coincident with or next following his completion of twenty (20) years of continuous service. This provision shall not apply to any member who retires or terminates employment prior to October 1, 1989. (B) Normal retirement benefit. (1) Duration, survivor benefits. A member retiring hereunder on his normal retirement date shall receive a monthly benefit which shall commence on his normal retirement date and be continued thereafter during his lifetime; upon his death the full retirement benefit shall be continued to his spouse for one year and sixty percent (60%) of that amount continued thereafter until the earlier of death or remarriage. (2) Amount. Normal retirement benefits shall be in the amount of two and one-half percent of average monthly earnings for each year of continuous service, subject in any event to a maximum of seventy-five percent (75%) of average monthly earnings; however, members as of the effective date shall receive at their normal retirement date (age 52 regardless of years of service) the greater of the benefit provided by the formula above or fifty percent (50%) of average monthly earnings. (3) Upon becoming eligible for normal retirement, a member shall be one hundred percent (100%) vested in his accrued benefit. (C) Disability retirement provisions. (1) (a) For purposes of this system, "TOTAL AND PERMANENT DISABILITY" shall mean an injury, disease or condition which totally and permanently incapacitates a member, either physically or mentally, fran his regular and continuous duty as a police officer or firefighter. A "TOTAL AND PERMANENT DISABILITY" arising directly from the ~erformance of service to the city by a member as a police officer or firefighter shall be considered to be a service incurred disability. A "TOTAL AND PERMANENT DISABILITY" arising from any other cause or source, other than as modified below, shall be considered to be a nonservice incurred disability. A member shall not be entitled to receive a disability retirement benefit from the system if the disability is a result of: 1. Excessive and habitual use of drugs, intoxicants or narcotics; 2. Injury or disease sustained by the member while willfully and illegally participating in fights, riots, civil insurrections, or while committing a crime; 3. Injury or disease sustained by a member while serving in any of the armed forces; 4. Injury or disease sustained by the member after his employment with the city has been terminated. (b) A member shall not receive a service incurred disability benefit for injury or disease sustained by the member while working (either as an employee or through some other contractual arrangement) for anyone other than the city, performing a job function the same as or related to the member's city job function, and arising out of the scope of any other employment or contractual arrangement, excepting injuries sustained by members while performing duties on behalf of the city and while within the city's jurisdiction although those injuries occurred at an outside employer's job site. In addition, a member shall not be entitled to receive a disability retirement benefit from the system on the basis of any condition which existed prior to the member's employment or which was evidenced during the member's preemployment physical. (2) Application for benefits. In order for the Board to consider a member's request for disability retirement benefits, the member must apply in writing to the Board. ~ ~~l~l~~l~lm~ll~l~l~l~llf~I~ ~~l~ll~lm~m~mllm~l~m~m~ll~n~//~ I~/~I~/~/~//f~/~/~I/~f//~½~/~~6~/b~//~ B~ Upon receipt of proper application by the Board of Trustees, the Board of Trustees shall arrange for a physical examination of the applicant by the medical board. A further condition for receipt of disability retirement benefits from the system is that the applicant must apply for and diliqently Dursue disability benefits from social security and workers' compensation. Written proof of application must be submitted to the Board of Trustees. Failure of the applicant to qualify as being disabled under either the social security or workers' compensation laws may be considered by the Board of Trustees in review ~/~~~ ~/~/B~//~f/~~ of that member's ~b~//~~ apDlication or recovery from disability. - 2 - Ord. No. 17-93 (3) Medical board. When a member submits proper application for a disability retirement benefit, the Board of Trustees shall designate a medical board to be composed of at least one b~//~/~//~//~ physician~. ~//~//~f ~~ The medical board shall arrange for and pass upon all medical examinations reqUired under the provisions of this subchapter, shall investigate all essential statements or certificates made by or on behalf of a member in connection with an application for disability retirement and shall report in writing to the Board of Trustees its conclusions and recommendations upon all matters referred to it. The payment of those services shall be determined by the Board of Trustees. (4) Determination of disability. All questions relating to eligibility for initial payment or continuance of disability benefits shall be determined by the Board of Trustees, taking into consideration the recommendations of the medical board and any other evidence of which the Board of Trustees may avail itself. The general steps which the Board of Trustees shall follow in its determination shall be as listed below, provided however, that the Board of Trustees may, in its discretion, alter or modify these steps: (a) Determine whether the member's application is proper~ ~/~I~ (b) If application is for a nonservice incurred disability, determine whether the ten years of continuous service requirement has been met. (c) Based on all evidence submitted to the Board of Trustees, determine whether the applicant satisfies the definition of disability, including the absence of listed exclusions. (d) Determine whether the disability is to be considered a service incurred disability or a nonservice disability, taking into consideration F.S. Chapters 175.231 and 185.34. (e) Establish a date of disability. This date may be the date of injury causing the disability, the date when the member could no longer perform his regular and continuous duties, the date when his sick pay and vacation pay are exhausted or such other date as determined by the Board of Trustees. ~f~ ~ll~lll~ll~flll~~lll~ ~m~ll~lll~llm~m~lll~ll~lllm~lllm~! (5) Disability retirement benefits. (a) Eligibility. Each ~II member~ ~ shall be eligible for service incurred disability benefits, regardless of ~ length of continuous service. Each member who completes ten (10) years of continuous service prior to becoming disabled shall be eligible for nonservice incurred disability benefits. (b) Initial amount of service incurred disability benefit. Seventy-five percent (75%) of the member's average monthly earnings in effect on the date of disability, subject in any event to the offsets listed below. - 3 - Ord. No. 17-93 (C) Initial amount of nonservice incurred disability benefit. W~l~I~bI~ll~T_wo percent (2%) of average monthly earnings in effect on the date of disability for each year of continuous service, subject in any event to maximum fifty percent (50%) of average monthly earnings and subject further to the offsets listed below. (d) T~rms of payments. Disability benefits shall commence on or as of the first day of the month coincident with or next following the date of disability, as established by the Board of Trustees, and shall continue to be paid on the first day of each subsequent month until the death or recovery of the disability retiree. The same survivorship percentages which apply to normal retirement benefits shall also apply to disability retirement benefits. (e) Benefit offsets. Disability retirement benefits described above shall be reduced by any disability benefits paid by social security, by workers' compensation benefits to the extent such benefits when added to the member's disability retirement benefit from the system exceed the member's average monthly earnings on the date of disability, and by other benefit offsets set forth in division (C) (7) of this section. The reduction for social security shall be in the amount of the primary insurance amount only, not including any family benefit. Any cost of living adjustments in the disability retiree's social security and workers' compensation benefits shall not serve to reduce further the disability benefit payable from the system. The reduction for social security disability benefits shall terminate upon the retiree's attainment of age sixty-five (65). In the case of a lump sum settlement paid by workers' compensation, the disability retirement benefit payable from the system shall be adjusted as follows~ 1. The amount of the lump sum settlement shall be divided by the member's remaining life expectancy (in months), as determined using standard actuarial tables approved by the plan actuary; 2. If the number obtained in division 1. above, when added to the member's monthly disability retirement benefit from the system, exceeds the member's average monthly earnings on the date of disability, the amount of the excess shall be deducted from the member's monthly disability retirement benefit from the system, for the duration of the member's remaining life expectancy as determined in division 1. above. 3. If the number obtained in division 1. above, when added to the member's monthly disability retirement benefit from the system, does not exceed the member's average monthly earnings on the date of disability, there shall be no reduction of the member's disability retirement benefits from the system. Once the number of months of suspension has been completed, the disability retirement benefit from the system shall be resumed. Additional benefit adjustments shall also apply as described below in division (C) (7) of this section. (f) Eligibility for other benefits. In the event that a member applying for disability benefits is also eligible for either early or normal retirement, the Board may, upon the request of the member, pay the early or normal retirement benefit instead of a disability retirement benefit. - 4 - Ord. No. 17-93 (6) Annual report by disability retiree. (a) Each person currently receiving disability retirement benefits and each person who first qualifies for disability retirement benefits shall be required to submit to the Board of Trustees no later than March 1 of each ~~ year a signed and notarized report which includes, but is not limited to, the following information£~ 1. Upon request of the Board of Trustees, a medical report from the disability retiree's physician stating whether the retiree is still totally incapacitated to perform the regular and continuous duties of a police officer or firefighter shall be submitted to the Board. The required physician's statement must be dated within four months of the request. 2. A statement showing the amount the disability retiree received in the immediately preceding calendar year from the following sources: a. Social security (primary insurance amount only, not including family benefits); b. Workers' compensation (excluding medical reimbursements); and c. Compensation for work performed during the year. Copies of all IRS W-2 forms from each employer shall be required for this purpose. (b) A statement to the effect that the disability retiree understands that if the report is incomplete or incorrect, his disability retirement benefits may be suspended or discontinued. (c) In the event that the required annual report is not submitted to the Board on a timely basis, or is incomplete or incorrect, the Board may, in its discretion, suspend or discontinue the disability retirement benefits. (7) Annual benefit adjustments. (a) The monthly disability retirement benefit of each person who is receiving benefits on, or who shall receive benefits after, the effective date of this subchapter, shall be adjusted annually as described herein. First, the sum of the following items shall be calculated for the previous calendar year: 1. The disability retirement benefits paid from the system; 2. The social security primary insurance amounts (not including family benefits), less any cost of living adjustments since the benefit first went into effect; 3. The workers' compensation disability benefits (excluding medical reimbursements), less any cost of living adjustments since the benefit first went into effect, to the extent that such benefits, when added to the member's disability retirement benefit from the system exceed the member's average monthly earnings on the date of disability; and - 5 - Ord. No. 17-93 4. Any earned income (as defined in division (C) (11) of this section) received as evidenced by the IRS W-2 forms (excluding any sick and vacation pay received from the city pursuant to the disability, as determined by the Board of Trustees). (b) The annual rate of earnings of the disability retiree on his-aate of disability (utilizing the minimum set forth hereinafter) shall then be subtracted from this sum. If there is any excess of the sum over the sum of the disability retiree's predisability annual earnings rate (with a presumed minimum upon the effective date of this subchapter of $30,000) as increased or decreased annually by the city in accordance with the salary funded for comparably funded city positions, then the disability retirement benefit payable from the system shall be reduced. The amount of the annual reduction shall be equal to fifty percent (50%) of any sums up to and including $15,000 of the excess, plus one hundred percent (100%) of the excess, if any, which exceeds $15,000 in excess of the as-adjusted disability retiree's predisability annual earnings (with a presumed minimum upon the effective date of this subchapter of $30,000). The annual reduction so computed shall then be divided by twelve (12) to make it a monthly reduction. The monthly reduction shall then be subtracted from the monthly disability retirement benefit which has most recently been paid. If the sum of the four items listed above is less than the disability retirement benefit computed in accordance with division (C) (5) (b) or (c) of this section, as applicable, prior to the offset provided by (C) (5) (e) of this section, then the disability retirement benefit payable from the system shall be increased. The amount of the annual increase shall be equal to the amount of the disability retirement benefit computed in accordance with division (C) (5) (b) or (c) of this section, as applicable, prior to the offset provided by division (C) (5) (e) of this section, minus the sum of the four items listed above. The annual increase so computed shall then be divided by twelve (12) to make it a monthly increase. The monthly increase shall then be added to the monthly disability retirement benefit which has most recently been paid. Any T~ newly adjusted disability retirement benefit shall be paid for the twelve (12) months beginning on the next January 1; however, the disability retiree may petition the Board no more than once annually during that 12-month period for a ~computation of those benefit adjustments, which the Board may elect to consider and grant based upon demonstrated exigent circumstances occurring to the disability retiree subsequent to the last benefit adjustment. Upon the death of the disability retiree prior to his recovery, the monthly benefit rate without any adjustments shall be used to compute any survivor benefits which are payable from the system. (8) Disability affidavit. No member otherwise eligible to receive disability benefits shall be paid those benefits unless and until that member files a disability affidavit with the Board on a form furnished by the Board. By the disability affidavit, the prospective retiree shall affirm that he is acquainted and familiar with the terms and conditions of his disability retirement. In particular, he shall acknowledge the authority of the Board to require him to undergo periodic future physical examinations in order to determine whether he has recovered from disability ~/~/~b~. (9) Authority for reexamination. Each person who first qualifies for or is then receiving disability retirement benefits on or after the effective date of this subchapter shall be subject to periodic reexamination by a medical board selected by the Board of Trustees to determine if the disability has ceased to exist. ~l~m~ll~l~ll~l~~llm~ - 6 - Ord. No. 17-93 (10) Recovery from disability. (a) In the event a member who has been retired on a disability benefit regains his health and is able to perform his duties in the Police Department or Fire Department, the Board shall discontinue the pension; and further, the city shall, subject to budget and qualification of the member for the position, offer the member a position with the city as a police officer or firefighter. (b) If a member shall resume his employment with the city, as a police officer or firefighter, then he may pay into the fund an amount equal to the aggregate contributions plus interest at a rate to be determined by the Board (computed upon his annual earnings at the time of his disability retirement) he would have been required to make hereunder, as determined by the Board, during the period of his disability retirement had he not been retired, and shall thereupon ~//~b~//~ receive creditable service for the period of the disability retirement. In any event, that member shall retain credit for the period of continuous service to the date of disability. (11) Earned income. For purposes of this section, "EARNED INCOME" shall mean all wages, salaries, tips and other employee compensation received by the member, plus the amount of the member's net earnings from self-employment for any tax year. (D) Preretirement death. (1) Service incurred. A death benefit shall be payable on behalf of any member who dies as a direct result of an occurrence arising in the performance of service. These benefits are not to be limiting to other benefits available under state law. The benefits shall be payable as follows: (a) To the spouse, until the earlier of death or remarriage, a monthly benefit equal to fifty percent (50%) of the member's average monthly earnings; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the actuarial equivalent of a lifetime benefit payable to the member if the amount of fifty percent (50%) of the member's average monthly earnings at date of death, plus (b) 1. For each Unmarried child until he or she shall have reached the age of eighteen (18) years, and for each unmarried child from age 18 until age 22 who is a full-time student in a fully accredited high school, college or university, there shall be paid in equal monthly installments, an amount equal to five percent (5%) of the average monthly earnings subject to an overall limitation of a total of sixty percent (60%) of average monthly earnings for the spouse and children combined. The nonstudent child's pension shall terminate on the earlier of death, marriage or the attainment of age 18; the pension of a child who is a student shall terminate on the earlier of death, marriage or the attainment of age 22. Legally adopted children shall be eligible the same as natural children. 2. Upon remarriage or death of the spouse, the five percent (5%) child allowance shall be increased to ten percent (10%) for each child, not to exceed a combined total of thirty-five percent (35%) of the member's average monthly earnings. The trusteeship and disbursements of the pension to any child shall be determined by the Board of Trustees. - 7 - Ord. No. 17-93 (2) Nonservice incurred. If any member shall die in active service from causes not attributable ~ to active duty or service, a death benefit shall be payable as follows: (a) With less than one year of continuous service, a single sum amount of $2,500 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be. -~ (b) With one but less than five years of continuous service, a single sum amount of $5,000 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be. (c) With five or more years of continuous service: 1. A single sum amount of $5,000 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be, plus 2. To the spouse until remarriage or death, in equal monthly payments, a pension equal to sixty-five percent (65%) of that member's accrued pension as of date of death, subject to a minimum of twenty percent (20%) of average monthly earnings; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the actuarial equivalent of a lifetime benefit payable to the member in the amount of sixty-five percent (65%) of such member's accrued pension as of date of death, plus 3. To the child of the deceased member, the same benefits as are payable by reason of service incurred death, subject however, to a maximum combined limitation of monthly payments to the spouse and children of fifty percent (50%) of average monthly earnings and thirty-five percent (35%) after remarriage or death of spouse. (3) In the event more than one beneficiary is designated by the member, the death benefits provided in this section shall be apportioned equally among the beneficiaries. (E) Vesting. (1) If a member terminates his employment with the Police or Fire Departments, either voluntarily or by lawful discharge, and is not eligible for any other benefits under this system, he shall be entitled to the following: (a) With less than ten years of continuous service, refund of member contributions. (b) With ten or more years of continuous service: 1. The pension benefit accrued to his date of termination, payable commencing on the date which would have been his earliest normal retirement date had he remained in employment, provided he does not elect to withdraw his member contributions, or 2. Refund of member contributions. - 8 - Ord. No. 17-93 (2) Any member of this system who, for whatever reason, has his employment with the city as a .police officer or firefighter terminated, but who remains with or was previously employed by the city in some other capacity so that his total period of employment with the city is ten years or more, shall have all benefits accrued under this system preserved, provided he does not elect to withdraw his member contributions. These accrued benefits shall -be payable at his otherwise normal retirement date, in accordance with the provisions of this system. For purposes of determining normal retirement date under this vesting provision, continuous service shall include all continuous employment with the city as an employee as herein defined as well as the period of time subsequent to termination as a member of this system; however, benefits shall not be payable under this system during any period of continued employment by the city. Upon the written election of the Police Chief or Fire Chief shall be deemed terminated for the purpose of applying the provisions of this system. A Police Chief or Fire Chief who terminates his participation in this system shall not thereafter be eligible to receive benefits through this system while actively employed by the city. (F) Application of section. The provisions set forth herein shall be applicable to all current and future members of the plan, including members now receiving or who have applied for disability retirement benefits (except that these applicants and members receiving disability benefits shall not be subject to the provisions set forth in division (C) (1), (2) or (4) of this section above, as well as the earned income benefit offsets otherwise provided for herein). (G) Maximum benefits. A member may not receive a pension or disability benefit which exceeds the lesser of: (1) One hundred percent (100%) of the member's average compensation for the highest three consecutive years as a member in the pension fund; or (2) The maximum amount allowed under Section 415 of the Internal Revenue Code (increased to reflect the cost of living adjustment factor prescribed under Section 415(d) of the Internal Revenue Code), which is incorporated herein by reference. (H) Required payment of pension benefits. Pension benefits shall begin no later than April 1 of the calendar year following the calendar year in which the member retires, or in which the member attains age 70-1/2, even if the member has not filed a claim for pension benefits. In addition, payment of benefits shall be made in accordance with the applicable provisions of Section 401(a) (9) of the Internal Revenue Code, which is incorporated herein by reference. Section 2. That should any section or provision of this ordinance or any portion thereof, any paragraph, sentence or word be declared by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remainder hereof as a whole or part thereof other than the part declared to be invalid. Section 3. That all ordinances or parts of ordinances which are in conflict herewith be and the same are hereby repealed. Section 4. That this ordinance shall become effective immediately upon passage on second and final reading. - 9 - Ord. No. 17-93 PASSED AND ADOPTED in regular session oD second and final reading on this the __ day of , 1993. MAYOR ATTEST: City Clerk First Reading Second Reading - 10 - Ord. No. 17-93 MEMORANDUM TO: MAYOR AND CITY COMMISSIONERS FROM: CITY MANAGER~ SUBJECT: AGENDA ITEM # /~F- MEETING OF FEBRUARY 9, 1993 ORDINANCE NO. 17-93/POLICE AND FIRE PENSION ORDINANCE DATE: FEBRUARY 5, 1993 For some time now, amendments to Chapter 33, "Police and Fire Departments", of the City's code of ordinances have been under review. In October of 1992, the Commission passed Ordinance No. 14-92 which amended Section 33.66, "Finances and Fund Management", to provide that the Board of Trustees may invest up to sixty percent (60%) of the Trust Fund's assets in common or capital stock (as opposed to the 50% previously allowed). Also in October, 1992, Ordinance No. 52-92 was adopted which amended Section 33.62 to provide that an annual medical report shall be submitted by a disability retiree only if requested by the Board of Trustees, as opposed to being a mandatory requirement. The ordinance now before the Commission (#17-93) is one which addresses certain grammatical and verbiage changes to the text of Section 33.62, "Benefit Amounts and Eligibility", for purposes of clarity. They have previously been reviewed and recommended for adoption by the Board of Trustees, and have also been reviewed by the City Attorney's office. No substantive changes relating to benefit amounts, offsets or eligibility are incorporated in this ordinance. Recommend approval of Ordinance No. 17-93 on first reading. If passed, public hearing on February 23, 1993. I:ITY OF DELRI:IY BEI:II:H CITY ATTORNEY'S OFFICE ~oo ~w., ^v~. ~^~ FACSIMILE 407/278-4755 (407) 243-7090 January 27, 1993 Stephen H. Cypen 825 Arthur Godfrey Road P.O. Box 402099 Miami Beach, Florida 33140 Subject: Police and Firefiqhter Pension Ordinance Revisions Dear Steve: Anne Woods called me today to inquire as to the status of the pension revision ordinance. My files reveal that at a Pension Board meeting this summer, I handed to you a draft of the ordinance which included the revisions. At that time, I was prepared to present it to the Commission. At your'direction, however, I held on to the ordinance because you stated that you wanted to review it and advise me as to whether it was acceptable. Having not heard from you, I have not sent the ordinanc~forward. If the draft is acceptable, please let me know and I will place it on the next Commission agenda. Thank you for your cooperation. Sincerely, OFFICE OF THE CITY ATTORNEY CITY OF DELRAY BEACH, FLORIDA -David N. Tolces, Esq. Assistant City Attorney DNT:sh cc: Alison MacGregor Harty, City Clerk Members, Pension Board Anne Woods, Secretary, Pension Board MEMORANDUM TO: MAYOR AND CITY COMMISSIONERS FROM: CITY MANAGER~~ SUBJECT: AGENDA ITEM ~ ~ - MEETING OF APRIL 28. 1992 PROPOSED AMENDMENTS TO THE CODE OF ORDINANCES/POLICE AND FI~E RETIREMENT SYSTEM DATE: April 24, 1992 We have received a proposal to amend the Code of Ordinances with regard to the Police and Fire Retirement System. The proposed changes involve the elimination of the offset Social Security benefits on disability benefits, establishment of a 25% minimum for non-service connected disabilities, and for the investment of up to 60% of fund assets in common stocks. To eliminate the offset of Social Security benefits on disability benefits would raise the required City contribution by $17,034, or .22% of covered payroll. The establishment of a 25% minimum for non-service connected disabilities would raise the required City contribution by $1,622 or .02% or covered payroll. Currently, up to 50% of fund assets are permitted to be invested in common stocks. It is estimated that the proposed increase to 60% would have no additional monetary impact on the City. Additionally, Mr. Cypen, Attorney for the Police and Fire Pension Board of Trustees, has recommended that several grammatical errors be corrected in that portion of the Code which covers the Police and Fire Retirement System. A detailed staff report is attached as backup material for this item. Should the Commission agree to these proposed changes, an ordinance will be prepared for formal ratification at a future Commission meeting. KRUSE, O'CONNOR AND LING ~c. Fo.~ L^oo~o^LE OFF,CE 73~O GRIFFIN ROAD. ~UITE ~OO FORT LAUD~DAL[* ~LORIOA 333{a GAINESVILLE, ~LORIDA 32~01 (go4) 375-3800 July 22, 1991 Mr. Salvatore Arena, Secretary Delray Beach Police & Firefighters Pension Board 300 West Atlantic Avenue Delray Beach, Florida 33444-3666 Dear Sah At its July 17, 1991 meeting, the Pension Board asked us to determine the cost effect of eliminating the offset of Social Security benefits against the System's disability benefit. This change would raise the required City contribution by $17,034, or 0.22% of covered payroll, from $1,144,257 to $1,161,291. Also, as requested by the Board, we are enclosing a replacement for page 1 of our October 1, 1990 Actuarial Valuation Report. As you will recall, the headings of 'Last Valuation' and 'Current Valuation' were transposed. Please contact us if there are any questions regarding these matters. Sincerely yours, J. Stephen Palmquist" JSP/mm Enclosure KRUSE, O'CONNOR ANO LING ,~c. W~T ~OWA~O P~Or~51ONAL BUILOING 73~0 O~lrrlN ~OAO. ~UITE ~00 tORT LAUOEROALE. fLORIDA 33314 NORTH /CENTRAL fLORIDA OrrlC~ GAINESVILL[, fLORIDA 3~OI (904) 375-3800 R,PLY TO FORT LAUO,RDAL, June 19, 1991 Mr. Salvatore Arena, Secretary Delray Beach Police & Flrefighters Pension Board 300 West Atlantic Avenue Deiray Beach, Florida 33444-3666 Dear Mr. Arena: We are writing in response to your April 5, 1991 letter in which you asked for information regarding two matters. First, you asked when police officers and firefighters are considered to be classified employees for actuarial purposes. For our annual actuarial valuation reports, we have always used the date shown in the Annual Report to the State Treasurer's Office. For example, December 28, ].987 is being used in. your case. We presume that the date listed in the Annual Report is the date of hire, however, this should be verified with the finance department. Second, you asked about the financial impact of establishing a minimum non-service incurred disability benefit equal to 25% of pay. This change in benefits would raise the required City contribution by $.~[~622, or 0.02% of covered payroll, from $1,144,257 to $].,].45,879. Please contact us if you have any questions. Sincerely yours, J. Stephen Palmquist JSP/ m CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM MINUTES OF SEPTEMBER 25, 1991 MEMBERS: Lt. Brow-n, Sgt. Tustin, Officer Arena, Chief Wigderson, Chief Lincoln, Lt. Adams, Mr. Weekes, Mayor Lynch, Mr. Cypen, Anne Woods GUESTS: Mike Haley, S.E.I.; Spence Webster, Barnett Bank; Mills Riddick, Sun Bank; Officer P. Pitochelli, FOP; Melina Walinski & Sherry Muehlburg, Finance Department ABSENT: Mr. Tranter The meeting was officially called to order at 12:15pm by Lt. Brow~, Vice- Chairperson. A roll call was taken of members and guests. Mr. Tranter, Chairperson was not present for this meeting. Mr. Cypen will be arriving late. Lt. Brown revised the agenda by removing Items 4 & 5, which will be placed on the agenda at a later date. Officer Arena removed Item 6 from the agenda. 1. APPROVAL OF JULY 1991 MINUTES: The minutes were reviewed and corrections made. Mr. Weekes made the m~tion to approve the minutes. Chief Lincoln seconded the motion, all in favor, none opposed. 2. S.E.I. - MIKE HALEY: Mr. Haley re-capped the first six (6) months of the year through June 1991. Mr. Haley reviewed the report and stated that the market value of the plan, as of 6/30/91, was approximately $24,500,000.00. Mr. Cypen arrives for the meeting at 12:40pm. Mr. Haley stated that the rate of return on the equity segment of the plan, Sun Bank is a little above median and above the S&P 500 at 15.4%. Barnett Bank is at 13.7% which is belOw median and the S&P 500. Mr. Haley stated that in the bond segment of the plan there is some under performance. Sun Bank at 3.6%; Barnett Bank is roughly median at 4.2%. He stated that overall~ for the first six (6) months, on a total plan basis the plan under performed somewhat due to the asset allocations and also the equity performance of one (1) manager and the bond performance of one (1) manager has been below median. Mr. Haley stated that the stock segment of the plan indicates that Barnett Bank has had more returns below median by sector. Sun Bank has performed above median. :-in UF DELRAY BEACH POLICE & FIRE FIGHTERS k~ .... ~.,:i:;f SYSTEM SEPTEMBER 25, 1991 PAGE 2 2. S.E.I. - MIKE HALEY: cont'd, He stated that there are a number of similaries between the two money managers. He stated that both manager's tend to focus on the large capitalization stocks; well above median and slightly larger than S&P 500 x in terms of market capitalization. Mr. Weekes requested that Mr. Haley summarize the results of the plan for the six (6) month period. Mr. Haley stated that overall, on a risk adjusted basis, both manager's are performing about where they should be. 3. SUN BANK, 3RD. qUARTER PRESENTATION-MILLS RIDDICK: Mr. Riddick discussed the results of the 3rd. Quarter Report. He stated that the portion of the plan that Sun Bank manages is growth bias and the equity portion leans toward large capitalization growth issue stock. Mayor Lynch asked Mr. Riddick if Sun Bank should scale back would they only scale down on the equity portion of the portfolio? Mr. Riddick stated that Sun Bank is committed to equities and the portfolio indicates that they are invested at the highest percentage allowed by the Board and ordinance regulations which states the cap to be 50%. He feels that equities will be the asset of choice over the next 2 or 3 years. Mayor Lynch wanted to know who determined/decided on the 50% limit. Mr. Cypen stated that the limit is determined by regulations setforth within the ordinance. Chief Wigderson asked what the advantage would be to raise the 50% limit and what procedure would be required to raise the limit? Mr. Cypen stated that to raise the 50% limit an ordinance change would be required and the advantage of the change would be that statistically over a longer period of time common stocks return significantly higher percentages. Mr, Weekes stated that the Board has always been conservative and should continue to do so. After a lengthy discussion by the Board, Officer Arena made the motion to propose to the City Commission, along with the grammatical changes, that the common stock be increased from the 50~ limit ~o 6OZ. Mr. Weekes seconded the motion, all in favor, none opposed. .ITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM sEFTEMBER 25, 1991 PAGE 3 3. SUN BANK, 3RD. QUARTER PRESENTATION-MILLS RIDDICK: cont'd. Mr. Cypen stated that since representatives of both money managers were present for the meeting, he wanted it understood that if the requested change should pass Commission vote, the managers would still be required toxreceive, in writing, a specific subsequent resolution by the Board or the limit will remain at 50%. 7. BOARD APPROVAL FOR 3RD. QUARTER FEES - SUN BANK & BARNETT BANK: Officer Arena stated that since there was some confusion by the Board at the July meeting, in regard to the fees charged by the money manager's, the contracts entered into by the Board with both banks were reviewed and the fees submitted, on a quarterly basis, have been correct. 8. OTHER BUSINESS: - Approval of employee contribution for Christopher Burnette (Warrant #34): Mr. Cypen stated the Board would need to ratify and confirm the previously executed warrant approved. Officer Arena made the motion to approve Warrant 34. Chief Wigderson seconded the motion, ail in favor, none opposed. - Approval of Warrants #35 & 36: Mayor Lynch made the motion to approve Warrants #35 & 36. Chief Lincoln seconded the motion, all in favor, none opposed. Officer Arena distributed a letter from Kruse, O'Connor & Ling, regarding what the City's contribution would be if there should be a change in the Social Security Off-set. Mr. Cypen stated that an impact statement which reflects the costs that are attributable to the changes being presented to the City Commission has to be sent to Tallahassee, generally before final adoption. He stated that this impact statement should be requested from Steve Palmquist, Kruse, O'Connor & Ling. He stated that statute requires that before there are increases in benefits there must be an actuarial impact statement indicating how much the benefits will cost. This procedure is implemented to protect the tax payers. Officer Arena will contact Steve Palmquist requesting that the impact statement be done and sent to the State. \ Mayor Lynch stated that the Commission rejected the Israeli Bond program on staff recommendation from the Finance Department. The vote was 4 to 1. Mayor Lynch made the motion to send flowers to Vickie Phillips, Sun Bank, due to her illness. Chief Wigderson seconded the motion, all in favor, none opposed. .fTY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM SEPTEMBER 25, 1991 PAGE 4 8. OTHER BUSINESS: cont'd. Lt. Brown stated that there is a misunderstanding as t° who is responsible for chairing the Board meeting in the absence of the Chairperson. He stated that in June 1989, the last election was held and 3ohn Tranter was elected Chairperson and he was elected Vice-Chairperson. Mr. Cypen stated that the ordinance reads: "Board of Trustees shall meet/organize and elect one (1) of their members as Chairperson and one (1) member Vice- Chairperson within ten (10) days after Trustees are elected and duly qualified." He stated that the implication is that each two (2) years the Board would vote and elect new officers, The same person may be re-elected. Lt. Brown stated that it would be appropriate to agenda this item for the next Board meeting. At that time, a new Chairperson, Vice-Chairperson and Secretary will be voted upon. Lt. Brown made the motion to adjorn the meeting. Mr. Weeke$ seconded the motion, all in favor, none opposed. Meeting adjorned at l:30pm. The undersigned are the Secretary and Chairman of the Police and Fire Fighters Retirement System, Board of Trustees, and the information provided herein are the Minutes of the Meeting of said body for September 25, 1991, which minutes were formally approved and a~pted by the Police a~--~r~ers%.R~tirement System, Board of Trusteze~ on Secretary and~ an. NOTE TO THE READER: If the minutes that you have received are not complete as indicated above, then this means that these are not the offical minutes of the Police and Fire Fighters Retirmegt System, Board of Trustees. They will become official minutes only after they have been reviewed and approved, which may involve some amendments, additions or deletions to the minutes as set forth above. COPIES TO: Members of the Board City Commissioners City Manager, D. Harden City Attorney, J. Kurtz Finance Director, J. Safford Asst. Finance Director, M. Walinski Finance Department, S. Muehlburg Police & Fire Fighters Bulletin Boards ~o~ ~~- Board of Trustees CITY OF DELRA Y BEACH POLICE AND FIREFIGHTERS RETIREMENT SYSTEM i00,¥. W. ist Avenue Delray Beach, Florida 33444 F£8 26 199~ MEMORANDU~ C~? M~r~G~'S OFFICE TO: DAVID HARDIN, CITY MANAGER FROM: OFFICER SALVATORE ARENA, BOARD SECRETARY '~ SUBJECT: CITY COMMISSION AGENDA ITEM - REQUESTED ORDINANCE CHANGE DATE: FEBRUARY 19, 1992 Per your request, attached please find a copy of the Police & Firefighters Retirement System minutes dated January 15, 1992. As indicated in the minutes, the Board voted and approved the the minimum benefit for non-service disability will be 25% and that there would be no social security off-set against disability (Page 2, Item #4 of the minutes). If you should require additional information, please contact me at 243-7841. :acw Attachment CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM MINUTES OF JANUARY 15, 1992 MEMBERS: Mr. Weekes, Lt. Adams, Chief Wigderson, Major Lincoln, Sgt. Tustin, Lt. Brown, Mr. Cypen, Anne Woods, Mr. Duane GUESTS: Mr. Ray Gerner ABSENT: Mayor Lynch, Officer Arena The meeting was officially called to order at 2:02pm by Major Lincoln, Vice Chairman. A roll call was t~=n of members and gues~ Lt. Brown will be arriving laL~ to tb ~eeting. For the record, the Board did not meet in December 1991. 1. APPROVAL OF NOVEMBER 1991 MINUTES: The minutes were reviewed and corrections made. Lt. Adams made the motion to approve the minutes. Sgt. Tustin seconded the motion, all in favor, none opposed. Lt. Adams stated that for the record, a letter of resignation was received and accepted by the Board from John Trantor. 2. STEVE CYPEN - DISCUSSION OF BOARD COMPOSITION & CONFIDENTIALITY OF MEDICAL RECORDS: Board Composition - Mr. Cypen stated that he received information from the State, Insurance Commissioners office and the City regarding the Boards composition and the State's opinion is not clear. He stated, with Board approval, he would write a letter to the state specifically requesting clarification on composition of the Board, residency requirements of members and if the Board is in compliance with state statute. Lt. Brown arrived for the meeting at 2:16pm. Major Lincoln passed the gavel to Lt. Brown. Confidentiality of Medical Records - Mr. Cypen stated that medical records, in the absence of a waiver, would not be public doucments; and if the waiver is not executed and the records are not public documents there is no exemption from the Sunshine Law which requires public meeting should be held. Mr. Cypen stated that this situation would restrict the Board from being able to openly discuss, at a public meeting, a request for disability. CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM JANUARY 15, 1992 PAGE 2 2. STEVE CYPEN - DISCUSSION OF BOARD COMPOSITION & CONFIDENTIALITY OF MEDICAL RECORDS: cont'd. He presented the Board with a form that would be signed by the person seeking disability. This form would aUthorize a waiver of confidentiality of medical records. Per Mr. Cypen's suggestion, the form will be added to the disability application form presently used. 3. DISCUSSION OF MEMO FROM FINANCE DEPARTMENT - RE: COMPENSATION INCLUDED IN PENSION CALCULATION: Lt. Adams stated that what he was hoping to receive f m Finance was a breakdown that would indicatelhow pension beneffts would be determined. He stated that the information received was not exactly what he requested. Individual Benefit Statements: Mr. Cypen suggested that generally, for a fee, the actuary will prepare a benefit statement for members of the plan. Mr. Weekes suggested that the Administrative Assistant contact Steve Palmquist who then could determine the cost of preparing the statement. 4. BOARD APPROVAL - REQUEST OF ORDINANCE CHANGE ON THE 25% DISABILITY NON- SERVICE & SOCIAL SECURITY OFF-SET: Lt. Brown stated that the July minutes made reference to the proposed changes, but that a motion and the vote were not verified. The City Manager's office is requesting verification of the Boards approval for the proposed changes to the ordinance. Major Lincoln made the motion to approve the proposal as rendered. Chief Wigderson seconded the motion, all in favor, none opposed. Mr. Cypen stated that he did not recollect the specifics of the 2½% social security off-set. Officer Arena stated that Kruse, O'Connor & Ling sent a letter to the Board on June 17, 1991, which indicated the cost to eliminate the off-set of social security benefits against the systems disability benefit. The cost would be approximately $17,000.00 Mr. Cypen stated that a motion to request a change whereby the minimum benefit for non-service disability will be 25% and that there would be no social security off-set, of any kind, against disability off-set. Major Lincoln amended his original motion to reflect the language Mr. Cypen stated. Chief Wigderson seconded the motion, all in favor, none opposed. CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM JANUARY 15, 1992 PAGE 3 4. BOARD APPROVAL - REQUEST OF ORDINANCE CHANGE ON THE 25% DISABILITY NON- SERVICE & SOCIAL SECURITY OFF-SET~ cont'd. Mr. Cypen stated that the City should take into consideration that there may be one or more persons currently suffering the off-set and the ordinance change should be drawn in such a way as to apply only to retirees after the effective date of the ordinance change. Mr. Weekes stated his concerns on behalf of Mr. Ray Gerner. He stated that for' months Mr. Gerner has attented pension board meetings with numerous problems ~related to his retirement and disability benefit. These problems have caused Mr. Gerner both physical and mental harm; and he feels something should be'done to assist Mr. Gerner in rectifying his problems. Lt. Brown stated that he shared Mr. Weekes concerns. He stated that the City has to take immediate action on the ordinance change since the Board has voted twice on this subject. Lt. Brown stated that, as required, an impact study has been obtained showing that there would be a minimal cost impact. Mr. Cypen again stated that Mr. Gerner would have to contact the City concerning his re-imbursement and the payment would be received from the City not the pension fund. Mr. Gerner stated that he contacted the City and was told that the City would not act without the recommendation from the Board. Mr. Cypen asked Mr. Gerner if he had been paid back to the period of time retro- active to Barrigan in 19897 Mr. Gerner stated that he had. Mr. Cypen stated that Mr. Gerner was now relying on the Amsell case which states that re-imbursements are retro-active to the date the off-sets began which would be a period of time prior to Barrigan. He suggested that Mr. Gerner obtain an attorney and force the City to pay him. Mr. Gerner stated he was told by the City (Finance Department) that they would be willing to re-imburse him the additional monies only upon the written request of the Board. Mr. Cypen stated for the record, his opinion is that this is an obligation of the City and not the pension board. Mr. Cypen stated with regard to Mr. Gerner's potential lump sum settlement, it would be appropriate for the Board to request the actuary to determine Mr. Gerner's life expectancy since the Board is required to make the adjustment based upon this information. CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS R~xEMENT SYSTEM JANUARY 15, 1992 PAGE 4 4. BOARD APPROVAL - REQUEST OF ORDINANCE CHANGE ON THE 25% DISABILITY NON- SERVICE & SOCIAL SECURITY OFF-SET: cont'd. Mr. Cypen stated that after Mr. Gerner were to agree to a lump sum settlement he should return to the Board. At that time, the Board would use the standard acturial tables to obtain his life expectancy and then determine the amount of his monthly pension benefit. 5. IMPACT OF NEW DISABILITY ACT: Mr. Cypen stated that he did not know how this would impact the City's policy, but he felt it would have an impact on the pension fund. Major Lincoln stated that since cities are no longer able to use the medical exam as a pre-screening mechanism for determining if someone is fit for hiring; does the Board have the same responsibility. Meaning does the Board have to allow a person to enter the fund only to have to pay-off on a possible disability request in a short period of time. Mr. Cypen stated that there is a difference between the City and the Board. The Board does not hire. He stated that the Board would have to make sure that the City's physical exam is well done and if any pre-existing condition should exist it should be detailed completely. Also, a copy of the physical exam and the findings should be given to the Board immediately. 6. OTHER BUSINESS: -Officer Shinholt's Disability Request: The Administrative Assistant informed the Board that each physican who administered care was contacted in writing and requested to release a copy of their medical report to Dr. Bebout. Once the reports are received/reviewed by Dr. Bebout an appointment will be scheduled for Officer Shinholt to meet with Dr. Bebout. -Re-imbursement from Mrs. Wickert: The Administrative Assistant informed the Board that Officer Arena sent a letter to Mrs. Wickert requesting the $306.30 re-imbursement. At the next meeting, the Board will be made aware of how Mrs. Wickert wishes to re-pay the money. -Approval of Warrants #42 & 43: Lt. Adams made the motion to approve Warrant #42. Chief Wigderson seconded the motion, all in favor, none opposed. Lt. Adams made the motion to approve Warrant #43. Major Lincoln seconded the motion, all in favor, none opposed. Lt. Brown stated that he is working on locating a new site, possibly City Hall, for the Board to hold their monthly meeting. TO: Mr. Cypen DATE: 4/7/92 FROM: Alison Harty, City Clerk~ SUBJ: Proposed Ordinance Amending Chapter 33, "Police and Fire Departments" Attached is a copy of the body of the ordinance as I have initially drafted it. The underscores and deletions shown indicate your changes per the draft I was provided (as relates to Sec. 33.62). I've highlighted the areas which were amended subsequent to the date of the ordinance you worked from. I would appreciate you looking these over and making your changes, if any. As for Section 2 which pertains to Sec. 33.66, the change appears to be to subsection (E)(2), subparagraph (b), to allow up to 60% instead of 50%. Subsection (E)(2) was also amended. I've included a copy of the current Chapter 33 for your reference. Please review and return your edits/comments to me at your earliest convenience. Thank you for your assistance. lily nll. iR¥ illili FIRE DEPARTMENT 7-- ROBERT BROWN II L/eu renan t 101 WEST ATLANTIC AVENUE 407/243-7400 DELRAY BEACH, FI ~R.IDA 33444 Sun Corn 925-7400 DRA ; ORDINANCE NO. ~ AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AMENDING TITLE III, "ADMINISTRATION", CHAPTER 33, "POLICE AND FIRE DEPARTMENTS", SUBHEADING "PENSIONS", OF THE CODE OF ORDINANCES OF THE CITY OF DELRAY BEACH, FLORIDA, BY AMENDING SECTION 33.62, "BENEFIT AMOUNTS AND ELIGIBILITY", TO PROVIDE FOR CERTAIN GRAMMATICAL AND VERBIAGE CHANGES; AND AMENDING SECTION 33.66, "FINANCES AND FUND MANAGEMENT", SUBSECTION (E) (2) (b), TO PROVIDE THAT THE BOARD OF TRUSTEES MAY INVEST UP TO SIXTY PERCENT (60%) OF THE TRUST FUND'S ASSETS IN COMMON OR CAPITAL STOCK; PROVIDING A SAVING CLAUSE; PROVIDING A GENERAL REPEALER CLAUSE; PROVIDING AN EFFECTIVE DATE. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF DELHAY BEACH, FLORIDA, AS FOLLOWS: Section 1. That Title III, "Administration", Chapter 33, "Police and Fire Departments", Subheading "Pensions", Section 33.62, "Benefit Amounts and Eligibility", of the Code of Ordinances of the City of Delray Beach, Florida, be, and the same is hereby amended to read as follows: BENEFIT AMOUNTS AND ELIGIBILITY. (A) Normal retirement date. A member may elect to retire on the first day of any month if coincident with or following the attainment of his fifty-second birthday and the completion of twenty (20) years of continuous service; however, employees who are eligible to and become members as of the effective date of this system shall be eligible to retire, as above, upon the attainment of their fifty-second birthday, regardless of the number of years of continuous service. Effective October 1, 1989, a member may elect to retire on the first day of any month coincident with or next following his completion of twenty (20) years of continuous service. This provision shall not apply to any member who retires or terminates employment prior to October 1, 1989. (B) Normal retirement benefit. (1) Duration, survivor benefits. A member retiring hereunder on his normal retirement date shall receive a monthly benefit which shall commence on his normal retirement date and be continued thereafter during his lifetime; upon his death the full retirement benefit shall be continued to his spouse for one year and sixty percent (60%) of that amount continued thereafter until the earlier of death or remarriage. (2) Amount. Normal retirement benefits shall be in the amount of two and one-half percent of average monthly earnings for each year of continuous service, subject in any event to a maximum of seventy-five percent (75%) of average monthly earnings; however, members as of the effective date shall receive at their normal retirement date (age 52 regardless of years of service) the greater of the benefit provided by the formula above or fifty percent (50%) of average monthly earnings. (3) Upon becoming eligible for normal retirement, a member shall be one hundred percent (100%) vested in his accrued benefit. (C) Disability retirement provisions. (1) (a) For purposes of this system, "TOTAL AND PERMANENT DISABILITY" shall mean an injury, disease or condition which totally and permanently incapacitates a member, either physically or mentally, from his regular and continuous duty as a police officer or firefighter. A "TOTAL AND PERM,%NENT DISABILITY" arising directly from the performance of service to the city by a member as a police officer or firefighter shall be considered to be a service incurred disability. A "TOTAL AND PERMANENT DISABILITY" arising from any other cause or source, other than as modified below, shall be considered to be a nonservice incurred disability. A member shall not be entitled to receive a disability retirement benefit from the system if the disability is a result of: 1. Excessive and habitual use of drugs, intoxicants or narcotics; 2. Injury or disease sustained by the member while willfully and illegally participating in fights, riots, civil insurrections, or while committing a crime; 3. Injury or disease sustained by a member while serving in any of the armed forces; 4. Injury or disease sustained by the member after his employment with the city has been terminated. (b) A member shall ~ot receive a service incurred disability benefit for injury or disease sustained by the member while working (either as an employee or through some other contractual arrangement) for anyone other than the city, performing a job function the same as or related to the member's city job function, and arising out of the scope of any other employment or contractual arrangement, excepting injuries sustained by members while performing duties on behalf of the city and while within the city's jurisdiction although those injuries occurred at an outside employer's job site. In addition, a member shall not be entitled to receive a disability retirement benefit from the system on the basis of any condition which existed prior to the member's employment or which was evidenced during the member's preemployment physical. (2) Application for benefits. In order for the Board to consider a member's request for disability retirement benefit.s, the member must apply in writing to the Board. ~1~11~1~~11~~1~1111~11~*~i~ ~9~/~//~/~//W~l~//~~l~l/~f~l~ll~ ~ Upon receipt of proper application by the Board of Trustees, the Board of Trustees shall arrange for a physical examination of the aPplicant by the medical board. A further condition for receipt of disability retirement benefits from the system is that the appliCant must apply for and diligently pursue disability benefits from social security and workers' compensation. Written proof of application must be submitted to the Board of Trustees. Failure of the applicant to qualify as being disabled under either the social security or workers' compensation laws may be considered by the Board of Trustees in review 6~//~[~~//b;//[~/~//~f//~g~ of that member's ~[I~//~[~ application or recovery from disability. - 2 - Ord. No. 14-92 (3) Medical board. When a member submits proper application for a disability retirement benefit, the Board of Trustees shall designate a medical board to be composed of at least one b~/~//~/~½~//~ physician~. ~/~//~f ~6~~/~//W~/l~//~/~//~~//f~//~~ ~~ The medical board shall arrange for and pass upon all medical examinations required under the provisions of this subchapter, shall investigate all essential statements or certificates made by or on behalf of a member in connection with an application for disability retirement and shall report in writing to the Board of Trustees its conclusions and recom~aendations upon all matters referred to it. The payment of those services shall be determined by the Board of Trustees. (4) Determination of disability. All questions relating to eligibility for initial payment or continuance of disability benefits shall be determined by the Board of Trustees, taking into consideration the recommendations of the medical board and any other evidence of which the Board of Trustees may avail itself. The general steps which the Board of Trustees shall follow in its determination shall be as listed below, provided however, that the Board of Trustees may, in its discretion, alter or modify these steps: (a) Determine whether the member's application is proper: ~/~ (b) If application is for a nonservice incurred disability, determine whether the' ten years of continuous service requirement has been met. (c) Based on all evidence submitted to the Board of Trustees, determine whether the applicant satisfies the definition of disability, including the absence of listed exclusions. (d) Determine whether the disability is to be considered a service incurred disability or a nonservice disability, taking into consideration F.S. Chapters 175.231 and 185.34. (e) Establish a date of disability. This date may be the date of injury causing the disability, the date when the member could no longer perform his regular and continuous duties, the date when his sick pay and vacation pay are exhausted or such other date as determined by the Board of Trustees. ~f~//~/~/B~/6f/~~/~/~~ (5) Disability retirement benefits. (a) Eligibility. Each AII member~ ~ shall b__e eligible for service incurred disability benefits, regardless of ~ length of continuous service. Each member who completes ten (10) years of continuous service prior to becoming disabled shall be eligible for nonservice incurred disability benefits. (b) Initial amount of service incurred disability benefit. Seventy-five percent (75%) of the member's average monthly earnings in effect on the date of disability, subject in any event to the offsets listed' below. - 3 - Ord. No. 14-92 (C) Initial amount of nonservice incurred disability benefit. W~/~I~I~/~_Two percent (2%) of average monthly earnings in effect on the date of disability for each year of continuous service, subject in any event to maximum fifty percent (50%) of average monthly earnings and subject further to the offsets listed below. (d) Terms of payments. Disability benefits shall commence on or as of the first day of the month coincident with or next following the date of disability, as established by the Board of Trustees, and shall continue to be paid on the first day of each subsequent month until the death or recovery of the disability retiree. The same survivorship percentages which apply to normal retirement benefits shall also apply to disability retirement benefits. (e) Benefit offsets. Disability retirement benefits described above shall be reduced by any disability benefits paid by social security, by workers' 6ompensation benefits to the extent such benefits when added to the member's disability retirement benefit from the system exceed the member's average monthly earnings on the date of disability, and by other benefit offsets set forth in division (C) (7) of this section. The reduction for social security shall be in the amount of the primary insurance amount only, not including any family benefit. Any cost of living adjustments in the disability retiree's social security and workers' compensation benefits shall not serve to reduce further the disability benefit payable from the system. The reduction for social security disability benefits shall terminate upon the retiree's attainment of age sixty-five (65). In the case of a lump sum settlement paid by workers' compensation, the disability retirement benefit payable from the system shall be adjusted as follows: 1. The amount of the lump sum settlement shall be divided by the member's remaining life expectancy (in months), as determined using standard actuarial tables approved by the plan actuary; 2. If the number obtained in division 1. above, when added to the member's monthly disability retirement benefit from the system, exceeds the member's average monthly earnings on the date of disability, the amount of the excess shall be deducted from the member's monthly disability retirement benefit from the system, for the duration of the member's remaining life expectancy as determined in division 1. above. 3. If the number obtained in division 1. above, when added to the member's monthly disability retirement benefit from the system, does not exceed the member's average monthly earnings on the date of disability, there' shall be no reduction of the member's disability retirement benefits from the system. Once the number of months of suspension has been completed, the disability retirement benefit from the system shall be resumed. Additional benefit adjustments shall also apply as described below in division (C) (7) of this section. (f) Eligibility for other benefits. In the event that a member applying for disability benefits is also eligible for either early or normal retirement, the Board may, upon the request of the member, pay the early or normal retirement benefit instead of a disability retirement benefit. - 4 - Ord. No. 14-92 DRA (6) Annual report by disability retiree. (a) Each person currently receiving disability retirement benefits and each person who first qualifies for disability retirement benefits on or after the effective date of this subchapter shall be required to submit to the Board of Trustees no later than March 1 of each ~~ year a signed and notarized report which includes, but is not limited to, the following information: 1. A medical report from the disability retiree's physician stating whether the retiree is still totally incapacitated to perform the regular and continuous duties of a police officer or firefighter. The physician's statement must be dated within four months of the March 1 report deadline. 2. A statement showing the amount the disability retiree received in the immediately preceding calendar year from the following sources: a. Social security (primary insurance amount only, not including family benefits); b. Workers' compensation (excluding medical reimbursements); and c. Each employer which Paid him any compensation for work performed during the year. Copies of all IRS W-2 forms shall be required for this purpose. (b) A statement to the effect that the disability retiree understands that if the report is incomplete or incorrect, his disability retirement benefits may be suspended or discontinued. (c) In the event that the required annual report is not submitted to the Board on a timely basis, or is incomplete or incorrect, the Board may, in its discretion, suspend or discontinue the disability retirement benefits. (7) Annual benefit adjustments. (a) The monthly disability retirement benefit of each person who is receiving benefits on, or who shall receive benefits after, the effective date of this subchapter, shall be adjusted annually as described herein. First, the sum of the following items shall be calculated for the previous calendar year: 1. The disability retirement benefits paid from the system; 2. The social security primary insurance amounts (not including family benefits), less any cost of living adjustments since the benefit first went into effect; 3. The workers' compensation disability benefits (excluding medical reimbursements), less any cost of living adjustments since the benefit first went into effect, to the extent that such benefits, when added to the member's disability retirement benefit from the system exceed the member's average monthly earnings on the date of disability; and - 5 - Ord. No. 14-92 DRA 4. Any earned income (as defined in division (C) (11) of this section) received as evidenced by the IRS W-2 forms (excluding any sick and vacation pay received from the city pursuant to the disability, as determined by the Board of Trustees). (b) The annual rate of earnings of the disability retiree on his date of disability (utilizing the minimum set forth hereinafter) shall then be subtracted from this sum. If there is any excess of -the sum over the sum of the disability retiree's predisability annual earnings rate (with a presumed minimum upon the effective date of this subchapter of $30,000) as increased or decreased annually by the city in accordance with the salary funded for comparably funded city positions, then the disability retirement benefit payable from the system shall be reduced. The amount of the annual reduction shall be equal to fifty percent (50%) of any sums up to and including $15,000 of the excess, plus one hundred percent (100%) of the excess, if any, which exceeds $15,000 in excess of the as-adjusted disability retiree's predisability annual earnings (with a presumed minimum upon the effective date of this subchapter of $30,000). The annual reduction so computed shall then be divided by twelve (12) to make it a monthly reduction. The monthly reduction shall then be subtracted from the monthly disability retirement benefit which has most recently been paid. If the sum of the four items listed above is less than the disability retirement benefit computed in accordance with division (C) (5) (b) or (c) of this section, as applicable, prior to the offset provided by (C) (5) (e) of this section, then the disability retirement benefit payable from the' system shall be increased. The amount of the annual increase shall be equal to the amount of the disability retirement benefit computed in accordance with division (C) (5) (b) or (c) of this section, as applicable, prior to the offset provided by division (C) (5) (e) of this section, minus the sum of the four items listed above. The annual increase so computed shall then be divided by twelve (12) to make it a monthly, increase. The monthly increase shall then be added to the monthly disability retirement benefit which has most recently been paid. Any ~ newly adjusted disability retirement benefit shall be paid for the twelve (12) months beginning on the next January 1; however, the disability retiree may petition the Board no more than once annually during that 12-month period for a ~computation of those benefit adjustments, which the Board may elect to consider and grant based upon demonstrated exigent circumstances occurring to the disability retiree subsequent to the last benefit adjustment. Upon the death of the disability retiree prior to his recovery, the monthly b~nefit rate without any adjustments shall be used to compute any survivor benefits which are payable from the system. (8) Disability affidavit. No member otherwise eligible to receive disability benefits shall be paid those benefits unless and until that member files a disability affidavit with the Board on a form furnished by the Board. By the disability affidavit, the prospective retiree shall affirm that he is acquainted and familiar with the terms and conditions of his disability retirement. In particular, he shall acknowledge the authority of the Board to require him to undergo periodic future physical examinations in order to determine whether he has recovered from disability ~/~Z~/~g~b~. - 6 - Ord. No. 14-92 (9) Authority for reexamination. Each person who first qualifies for or is then receiving disability retirement benefits on or after the effective date of this subchapter shall be subject to periodic reexamination by a medical board selected by the Board of Trustees to determine if the disability has' ceased to exist. T~/~~//~I/~/~/~~//~ {10) Recovery from disability. (a) In the event a member who has been retired on a disability benefit regains his health and is able to perform his duties in the Police Department or Fire Department, the Board shall discontinue the pension; and further, the city shall, subject to budget and qualification of the member for the position, offer the member a position with the city as a police officer or firefighter. (b) If a member shall resume his employment with the city, as a police officer or firefighter, then he may pay into the fund an amount equal to the aggregate contributions plus interest at a rate to be determined by the Board (computed upon his annual earnings at the time of his disability retirement) he would have been required to make hereunder, as determined by the Board, during the period of his disability retirement had he not been retired, and shall thereupon ~ ~6~/~II receive creditable service for the period of the disability retirement. In any event, that member shall retain credit for the period of continuous service to the date of disability. (11) Earned income. For purposes of this section, "EARNED INCOME" shall mean all wages, salaries, tips and other employee compensation received by the member, plus the amount of the member's net earnings from self-employment for any tax year. (D) Preretirement death. (1) Service incurred. A death benefit shall be payable on behalf of any member who dies as a direct result of an occurrence arising in the performance of service. These benefits are not to be limiting to other benefits available under state law. The benefits shall be payable as follows: (a) To the spouse, until the earlier of death or remarriage, a monthly benefit equal to fifty percent (50%) of the member's average monthly earnings; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the actuarial equivalent of a lifetime benefit payable to the member if the amount of fifty percent (50%) of the member's average monthly earnings at date of death, plus (b) 1. For each unmarried child until he or she shall have reached the age of eighteen (18) years, and for each unmarried child from age 18 until age 22 who is a full-time student in a fully accredited high school, college or university, there shall be paid in equal monthly installments, an amount equal to five percent' (5%) of the average monthly earnings subject to an overall limitation of a total of sixty percent (60%) of average monthly earnings for the spouse and children combined. The nonstudent child's pension shall terminate on the earlier of death, marriage or the attainment of age 18; the pension of a child who is a student shall terminate on the earlier of death, marriage or the attainment of age 22. Legally adopted'children shall be eligible the same as natural children. - 7 - Ord. No. 14-92 2. Upon remarriage or death of the spouse, the five percent (5%) child allowance shall be increased to ten percent (10%) for each child, not to exceed a combined total of thirty-five percent (35%) of the member's average monthly earnings. The trusteeship and disbursements of the · pension to any child shall be determined by the Board of Trustees. (2) Nonservice incurred. If any member shall die in active service from causes not attributable to active duty or service, a death benefit shall be payable as follows: (a) With less than one year of continuous service, a single sum amount of $2,500 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be. (b) With one but less than five years of continuous service, a single sum amount of $5,000 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be. (c) With five or more years of continuous service: 1. A single sum amount of $5,000 to the member's spouse or other designated beneficiary or beneficiaries, as the case may be, plus 2. To the spouse until remarriage or death, in equal monthly payments, a pension equal to sixty-five percent (65%) of that member's accrued pension as of date of death, subject to a minimum of twenty percent (20%) of average monthly earning~; or to a designated beneficiary or beneficiaries other than the spouse, until death, a monthly benefit equal to the actuarial equivalent of a lifetime benefit payable to the member in the amount of sixty-five percent (65%) of such member's accrued pension as of date of death, plus 3. To the child of the deceased member, the same benefits as are payable by reason of service incurred death, subject however, to a maximum combined limitation of monthly payments to the spouse and children of fifty percent (50%) of average monthly earnings and thirty-five percent (35%) after remarriage or death of spouse. (3) In the event more than one beneficiary is designated by the member, the death benefits provided in this section shall be apportioned equally among the beneficiaries. (E) Vesting. (1) If a member terminates his employment with the Police or Fire Departments, either voluntarily or by lawful discharge, and is not eligible for any other benefits under this system, he shall be entitled to the following: (a) . With less than ten years of continuous service, refund of member contributions. (b) With ten or more years, of continuous service: - 8 - Ord. No. 14-92 DRA 1. The pension benefit accrued to his date of termination, payable commencing on the date which would have been his earliest normal retirement date had he remained in employment, provided he does not elect to withdraw his member contributions, or 2. Refund of member contributions. (2) Any member of this system who, for whatever reason, has his employment with the city as a police officer or firefighter terminated, but who remains with or was previously employed by the city in some other capacity so that his total period of employment with the city is ten years or more, shall have all benefits accrued under this system preserved, provided he does not elect to withdraw his member contributions. These accrued benefits shall be payable at his otherwise normal retirement date, in accordance with the provisions of this system. For purposes of determining normal retirement date under this vesting provision, continuous service shall include all continuous employment with the city as an employee as herein defined as well as the period of time subsequent to termination as a member of this system; however, benefits shall not be payable under this system during any period of continued employment by the city. Upon the written election of the Police Chief or Fire Chief shall be deemed terminated for the purpose of applying the provisions of this system. A Police Chief or Fire Chief who terminates his participation in this system shall not thereafter be eligible to receive benefits through this system while actively employed by the city. (F) Application of section. The provisions set forth herein shall be applicable to all current and future members of the plan, including members now receiving or who have applied for disability retirement benefits (except that these applicants and members receiving disability benefits shall not be subject to the provisions set forth in division (C) (1), (2) or (4) of this section above, as well as the earned income benefit offsets otherwise provided for herein). (G) Maximum benefits. A member may not receive a pension or disability benefit which exceeds the lesser of: (1) One hundred percent (100%) of the member's average compensation for the highest three consecutive years as a member in the pension fund; or (2) The maximum amount allowed under Section 415 of the Internal Revenue Code (increased to reflect the cost of living adjustment factor prescribed under Section 415(d) of the Internal Revenue Code), which is incorporated herein by reference. (H) Required payment of pension benefits. Pension benefits shall begin no later than April 1 of the calendar year following the calendar year in which the member retires, or in which the member attains age 70-1/2, even if the member has not filed a claim for pension benefits. In addition, payment of benefits shall be made in accordance with the applicable prOvisions of Section 401(a) (9) of the Internal Revenue Code, which is incorporated herein by reference. - 9 - Ord. No. 14-92 DRAFT Section 2. That Title III, "Administration~ Chapter 33, "Police and Fir~ Departments", Subheading "Pensions", Section 33.66, "Finances and Fund Management", Subsectio~E) (2) (b), of the Code of Ordinances of the City of Delray Be~Wh, Florida, be, and the same is hereby amended to read as fo~6ws: (2) The Board of Trustees/~ay invest and- reinvest the assets of the Trust Fund in bonds,~ocks, or o~her evidences of indebtedness issued or guarantee~by a corporation organized under the laws of the United St~fes, any~ state, ox or.$anized territory of the United States/or the District of Columbia, provided: (a) T~'corporation is listed on any one or more of the recognized/ational stock exchanges and holds a rating in one of the .~ree highest classifications by a major rating service. /~ (b) The Board of Trustees shall not invest more than five ~rcent (5%) of its assets in the common or capital stock ~f any one issuing company, nor shall the aggregate investment i~/common or capital stock in one company exceed five percent (5%)/of the outstanding common or capital stock of that company; ~r shall the aggregate of the Fund's investments in com/non o/capital stock at cost exceed f~£~ sixty percent (60%).~f the .F~n~'s assets. Assets of the Fund not invested in c--6-~/or capital stock may be invested in corporate bonds or oth~ legal investments as provided in F.S. Chapters 175 and 185. Section~.'~'That should any section or provision of this ordinance or any portion thereof, any paragraph, sentence or word be declared by a court of competent jurisdiction to be invalid, such decision shall not effect the validity of the remainder hereof as a whole or part thereof other than the part declared to be invalid. Section~. That all ordinances or parts of ordinances which are in conflict herewith be and the same are hereby repealed. .! Section~. That this ordinance shall become effective immediately upon passage on second and final reading. PASSED AND ADOPTED in regular session on second and final reading on this th~ day of , 1992. MAYOR ATTEST: City Clerk First Reading Second Reading - 10 - Ord. No. 14-92 · Agenda Item No.: AGENDA REQUEST Date: Request to be placed on:, Regular Agenda Special Agenda Workshop Agenda When: !0 (~l ~ i. Description of agenda item (who, what, where, how much): ORDINANCE/ RESOLUTION REQUIRED: ~O Draft Attached:~O Recommendation: ~ ~-~¥ ~'~-~.~ ~.~ ^~ ~1~ ~ '--~-o c~-{ ~ Department Head Signature: ¢~.,~ ~~ ~'~. Dete~inatiom of Consistency with Comprehensive Plam: City Attorney Review/ Recommendation (if applicable): Budget Director Review (required on all items involving expenditure of funds): Funding available: YES/ NO Funding alternatives: (if applicable) Account No. & Description: Account B~lance: City Manager Review: Approved for agend~v NO Hold Until: Agenda Coordinator Review: Received: Action: Approved/Disapproved CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM MINUTES OF SEPTEMBER 25, 1991 MEMBERS: Lt. Brown, Sgt. Tustin, Officer Arena, Chief Wigderson, Chief Lincoln, Lt. Adams, Mr. Weekes, Mayor Lynch, Mr. Cypen, Anne Woods GUESTS: Mike Haley, S.E.I.; Spence Webster, Barnett Bank; Mills Riddick, Sun Bank; Officer P. Pitochelli, FOP; Melina Walinski & Sherry Muehlburg, Finance Department ABSENT: Mr. Tranter The meeting was officially called to order at 12:15pm by Lt. Brown, 'Vice- Chairperson. A roll call was taken of members and guests. Mr. Tranter, Chairperson was not present for this meeting. Mr. Cypen will be arriving late. Lt. Brown revised the agenda by removing Items 4 & 5, which will be placed on the agenda at a later date. Officer Arena removed Item 6 from the agenda. 1. APPROVAL OF JULY 1991 MINUTES: The minutes were reviewed and corrections made. Mr. Weekes made the m6tion to approve the minutes. Chief Lincoln seconded the motion, all in favor, none opposed. 2. S.E.I. - MIKE HALEY: Mr. Haley re-capped the first six (6) months of the year through June 1991. Mr. Haley reviewed the report and stated that the market value of the plan, as of 6/30/91, was approximately $24,500,000.00. Mr. Cypen arrives for the meeting at 12:40pm. Mr. Haley stated that the rate of return on the equity segment of the plan, Sun Bank is a little above median and above the S&P 500 at 15.4%. Barnett Bank is at 13.7% which is below median and the S&P 500. Mr. Haley stated that in the bond segment of the plan there is some under performance. Sun Bank at 3.6%; Barnett Bank is roughly median at 4.2%. He stated that overall~ for the first six (6) months, on a total plan basis the plan under performed somewhat due to the asset allocations and also the equity performance of one (1) manager and the bond performance of one (1) manager has been below median. Mr. Haley stated that the stock segment of the plan indicates that Barnett Bank has had more returns below median by sector. Sun Bank has performed above median. ~z'r~ 'u¥ ~ELRAY BEACH POLICE & FIRE FIGHTERS RE'~i:~m£NT SYSTEM · SEPTEMBER 25, 1991 PAGE 2 2. S.E.I. - MIKE HALEY: cont'd. He stated that there are a number of similaries between the two money managers. He stated that both manager's tend to focus on the large capitalization stocks; well above median and slightly larger than S&P 500 Xin terms of market capitalization. Mr. Weekes requested that Mr. Haley summarize the results of the plan for the six (6) month period. Mr. Haley stated that overall, on a risk adjusted basis, both manager's are performing about where they should be. 3. SUN BANK, 3RD. QUARTER PRESENTATION-MILLS RIDDICK: Mr. Riddick discussed the results of the 3rd. Quarter Report. He stated that the portion of the plan that Sun Bank manages is growth bias and the equity portion leans toward large capitalization growth issue stock. Mayor Lynch asked Mr. Riddick if Sun Bank should scale back would they only scale down on the equity portion of the portfolio? Mr. Riddick stated that Sun Bank is committed to equities and the portfolio indicates that they are invested at the highest percentage allowed by the Board and ordinance regulations which states the cap to be 50%. He feels that equities will be the asset of choice over the next 2 or 3 years. Mayor Lynch wanted to know who determined/decided on the 50% limit. Mr. Cypen stated that the limit is determined by regulations setforth within the ordinance. Chief Wigderson asked what the advantage would be to raise the 50% limit and what procedure would be required to raise the limit? Mr. Cypen stated that to raise the 50% limit an ordinance change would be required and the advantage of the change would be that statistically over a longer period of time common stocks return significantly higher percentages. Mr. Weekes stated that the Board has always been conservative and should continue to do so. After a lengthy discussion by the Board, Officer Arena made the motion to propose to the City Commission, along with the grammatical changes, that the common stock be increased from the 50% limit to 60%. Mr. Weekes seconded the motion, all in favor, none opposed. ,.JITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM SEPTEMBER 25, 1991 PAGE 3 3. SUN BANK, 3RD. QUARTER PRESENTATION-MILLS RIDDICK: cont'd. Mr. Cypen stated that since representatives of both money managers were present for the meeting, he wanted it understood that if the requested change should pass Commission vote, the managers would, still be required toxreceive, in writing, a specific subsequent resolution by the Board or the limit will remain at 50%. 7. BOARD APPROVAL FOR 3RD. QUARTER FEES - SUN BANK & BARNETT BANK: Officer. Arena stated that since there was some confusion by the Board at the July meeting, in regard to the fees charged by the money manager's, the contracts entered into by the Board with both banks were reviewed and the fees submitted, on a quarterly basis, have been correct. 8. OTHER BUSINESS: - Approval of employee contribution for Christopher Burnette (Warrant #34): Mr. Cypen stated the Board would need to ratify and confirm the previously executed warrant approved. Officer Arena made the motion to approve Warrant 34. Chief Wigderson seconded the motion, all in favor, none opposed. - Approval of Warrants #35 & 36: Mayor Lynch made the motion to approve Warrants #35 & 36. Chief Lincoln seconded the motion, all in favor, none opposed. Officer Arena distributed a letter from Kruse, O'Connor & Ling, regarding what the City's contribution would be if there should be a change in the Social Security Off-set. Mr. Cypen stated that an impact statement which reflects the costs that are attributable to the changes being presented to the City Commission has to be sent to Tallahassee, generally before final adoption. He stated that this impact statement should be requested from Steve Palmquist, Kruse, O'Connor & Ling. He stated that statute requires that before there are increases in benefits there must be an actuarial imPact statement indicating how much the benefits will cost. This procedure is implemented to protect the tax payers. Officer Arena will contact Steve Palmquist requesting that the impact statement be done and sent to the State. Mayor Lynch stated that the Commission rejected the Israeli Bond program on staff recommendation from the Finance Department. The vote was 4 to l. Mayor Lynch made the motion to send flowers to VJ. ckie Phillips, Sun Bank, due to her illness. Chief Wigderson seconded the motion, all in favor, none opposed. .£TY OF'DELR~Y BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM SEPTEMBER 25, 1991 PAGE 4 8. OTHER BUSINESS: cont'd. Lt. Brown stated that there is a misunderstanding as to who is responsible for chairing the Board meeting in the absence of the Chairperson. \ He stated that in June 1989, the last election was held and John Tranter was elected Chairperson and he was elected Vice-Chairperson. Mr. Cypen stated that the ordinance reads: "Board of Trustees shall meet/organize and elect one (1) of their members as Chairperson and one (1) member Vice- Chairperson within ten (10) days after Trustees are elected and duly qualified." He stated that the implication is that each two (2) years the Board would vote and elect new officers. The same person may be re-elected. Lt. Brown stated that it would be appropriate to agenda this item for the next Board meeting. At that time, a new Chairperson, Vice'Chairperson and Secretary will be voted upon. Lt. Brown made the motion to adjorn the meeting. Mr. Weekes seconded the motion, all in favor, none opposed. Meeting adjorned at l:30pm. The undersigned are the Secretary and Chairman of the Police and Fire Fighters Retirement System, Board of Trustees, and the information provided herein are the Minutes of the Meeting of said body for September 25, 1991, which minutes were formally approved and a~d, ppted by the Police aqa~Fl~-~-~}r~~ System, Board of Truste, e~ on '~54~. ~, I~q i~_.--~---~m%-~----~-~' , Secretary and/~~~an. ' ~ ~ ~~ NOTE TO THE READER: If the minutes that you have received are not complete as indicated above, then this means that these are not the offical minutes of the Police and Fire Fighters Retirment System, Board of Trustees. They will become official minutes only after they have been reviewed and approved, which may involve some amendments, additions or deletions to the minutes as set forth above. COPIES TO: Members of the Board City Commissioners City Manager, D. Harden City Attorney, J. Kurtz Finance Director, J. Safford Asst. Finance Director, M. Walinski Finance Department, S. Muehlburg Police & Fire Fighters Bulletin Boards CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM MINUTES OF JULY 19, 1991 MEMBERS: OFFICER ARENA, LT. ADAMS, CHIEF LINCOLN, MR. TRANTER, MR. WEEKES, SGT. TUSTIN, MAYOR LYNCH, LT. BROWN, MR. CYPEN, ANNE WOODS GUESTS: MELINA WALINSKI & SHERRY MUEHLBURG, FINANCE DEPT.: DAVID TOLCES, ASST. CITY ATTORNEY: STEVEN PALMQUIST, KRUSE, O'CONNOR & LING: MIKE HENDRICKS & JOE LIGUORI, FIRE DEPT. ABSENT: CHIEF WIGDERSON, FIRE DEPT. The meeting was officially called to order at 2:05pm by Mr. Tranter, Chairman. A roll call was taken of members and guests. Chief Wigderson was not present for this meeting. 1) APPROVAL OF JUNE 1991 MINUTES: The minutes were reviewed and corrections made. Chief Lincoln made the motion to approve the minutes. Sgt. Tustin seconded the motion, all in favor, none opposed. 2) APPROVAL OF MAY 1991 MINUTES (TABLED AT JUNE MEETING): The corrections made on the May minutes were reviewed. Officer Arena made the motion to approve the minutes. Lt. Adams seconded the motion, all in favor, none opposed. Mayor Lynch arrived for the meeting at 2:15pm. 3) STEVE PALMQUIST: KRUSE, O'CONNOR & LING -REVIEW OF ACTURIAL REPORT: Mr. Palmquist stated that his firm determines the amount of money the City will contribute to the pension fund annually. In addition, he stated that if the Board were to consider any changes in benefits it would be the responsibility of his firm to determine the acturial impact these changes would have to the fund. Mr. Palmquist stated that upon a person retiring, he calculates the retirement benefits and options that are available to the retiree. Mr. Palmquist reviewed and explained the acturial report. He stated that the current amount of the City's (employer) contribution is $1,144,257.00. He stated that the required City contribution has been computed under the assumption that the amount to be received from the State on behalf of police/fire fighters this year will be $491,624.00. If the next payment from the State exceeds this amount, then the City may reduce its contribution accordingly. If the State's next payment should fall below this amount, then the City must increase it's contribution to make-up the difference. oF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM 19, 1991 2 3) REVIEW OF ACTURIAL REPORT: cont'd. Mr. Palmquist stated that the actual contributions from the City and State for the previous year were $918,723.00 and $491,624.00, for a total of $1,410,347.00. He stated that the two (2) reasons why the City's contribution increased were due to the investment return for the year was approximately 6%, for year ending September 1990, and he was assuming that it would have been 8.5%. The differential was approximately 40% of the reason why the City's cost went up. Mr. Palmquist also stated that last year the fund had a return of 12%, which was the opposite of what occurred this year. Due to the high percent received last year there was extra money in the fund in September 1989, and the City's contribution could be decreased. Mr. Palmquist stated that the major part of the increase was due to the fact that the Board granted six (6) new disability claims during the year ending September 1990. He stated that the effect of these claims had a tremendous impact. In 1989 $2,468,581.00 was paid in disability benefits and in 1990 the amount increased to $4,083,645.00. Lt. Brown arrived for the meeting at 2:25pm. Mr. Palmquist stated that from 1987 thru 1989 there were 14 people receiving disability benefits which amounted to $230,138.00. In 1990 the number of disability recipients increased to 19, increasing the amount of benefits paid to $372,035.00. (The sixth person had died during the year and his beneficiaries were receiving survivor benefits.) Officer Arena stated that a letter was received from the Finance Department stating that the City auditors would try to have the pension fund portion of the audit completed by the end of January. The information could then be released to Kruse, O'Connor & Ling allowing a faster turn-around time in receiving the acturial report. After additional discussion, Mr. Weekes made the motion to accept the acturial report. Sgt. Tustin seconded the motion, all in favor, none opposed. Mr. Palmquist stated that he received letters from the Board Secretary requesting clarification on the following issues: What date is used when a person enters the pension plan? He stated the date of hire is used for calculations. The second issue was: W~at effect would be encountered if the Board were to raise the non-duty disability benefit to the minimum 25% of salary? Mr. Palmquist stated that presently, 2% of pay for each year of service, with at least 10 years of service is required to be eligible to receive the benefit. £ DEL~Y BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM 19, 1991 3: REVIEW OF ACTURIAL REPORT: cont'd. Mr. Cypen stated that in his opinion this procedure would go along with the interpretation of State law. Mr. Palmquist stated that if the 25% minimum were to be put in place the effect would be an increase cost of approximately $1,100.00 or .0002% of 1%. The effect to the plan would be very minor. Mr. Cypen stated that the groups would have to bargain or sign-off on the change to achieve compliance. The third issue Mr. Palmquist addressed was: When does employee contributions to the pension plan become tax deferred? He stated that the City, with agreement of all parties, went ahead and implemented the tax deferral feature even though the IRS determination letter was not received. The letter from the IRS would have stated that the plan is a qualified plan. He stated that the City was within its right to make the change, but usually the IRS letter is received first. Mr. Palmquist made the suggestion that application to the IRS should be made to receive the qualification letter of approval. If the Board requested, his firm would complete the necessary IRS forms and apply for the letter. Mr. Cypen stated that the Board could request a letter from Kruse, O'Connor & Ling stating that based upon their examination of the documentation the plan is qualified, and if the IRS should request such a determination this letter could then be presented. Mr. Palmquist will write the requested letter and send it to the Board. 4) REQUEST BY LT. BROWN: DISCUSSION OF THE FOLLOWING: -Computation of Pension Benefits: Lt. Brown stated that he was directed, by participants of the plan, to receive in writing the formula/policy Finance Department implements to compute pension benefits. Mr. Cypen stated that the formula Finance should be using is to multiply the appropriate factor by the final average time by the appropriate credit of service. He also stated that the ordinace is the guideline used to determine the formula/policy and 1/24 of earnings is used. The Board directed Melina Walinski, Asst. Finance Director, to work-up a earning schedule that would address this issue, and it will be discussed at the next meeting, x -Social Security Off-set for Disability Retirement: Lt. Brown stated that both bargaining units do not feel that the off-set should be a bargaining item due to the fact that non-union members are included. The bargaining units feel that at the Board's request, the City Commission could drop this requirement by changing the ordinance (Page 14, (7) 2&3). This change could be requested and appproved at the time the ordinance is presented to the Commission for approval of revised wording that Mr. Cypen pointed-out. ~. DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM 19, 1991 · ~/4 4) REQUEST BY LT. BROWN: DISCUSSION OF THE FOLLOWING: cont'd. -Social Security Off-set for Disability Retirement: Mr. Cypen stated that the Board could not request a change to the off-set, but only request the Commission to review the section. He stated that this issue is between labor and management. Mr. Cypen stated that the changes he made to the ordinance in no way effected benefits or cost. He stated that the changes he made were only for the purpose of clarification. Mr. Weekes stated that if there is a contract with the bargaining units the City cannot arbitrarily alter the contract for the good or bad. He stated that there would be a violation of an unfair labor practice. Joe Liguori, Fire Department, stated that the unions feeling is that they are not going to spend money and time to negotiate change for members that are not part of the bargaining unit. He stated that it is also their position that something that may have a negative impact obviously they will go to the bargaining table and try to reduce the impact or come to an agreement. He also stated that it is the opinion of the union attorney that the requested changes-could be made as a sign-off at the Board's request. Mr. Cypen stated he felt the determination made by the union attorney was wrong. Mr. P~lmquist stated that he has done studies for other plans on eliminating the social security off-set and the increase in cost was approximately ~ of 1 percent of payroll. Lt. Brown made the motion to have Mr. Palmquist work-up a cost-out deletion summary~ and recommend to the Commission deletion of the off-set from the ord{nance. Mr. Cypen stated that he did not feel that this was an appropriate motion at this time. He stated that the Board should not be recommending a benefit change, but to inform the Commission that a cost-out summary had been done and it has been recommended and signed-off by the union's. The package containing the changes and recommendations would then be presented to the City for review and approval if they see fit. Mr. Weekes seconded Lt. Brown's motion to obtain the cost-out summary from Mr. Palmquist, all in favor, none opposed. Mayor Lynch stated that he felt that the ordinance (with grammatical changes ~nly) be submitted to the Commission and when the cost-out summary is received from Mr. Palmquist re-submit that information to the Commission. OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM 19, 1991 5 4) REQUEST BY LT. BROWN: DISCUSSION OF THE FOLLOWING: cont'd. Mayor Lynch stated that he is in favor of three (3) separate motions: original grammatical changes, 25% and the cost-out summary on the off-set deletion. The Board decided to wait and submit a complete package with changes and recommendations. -Extra Benefit Package: Lt. Brown made reference to a letter received from Jill Hanson, Esq. (attorney for the Fire Dept. unio~ dated September 17, 1990. The letter requested that a lawsuit be filed against the City for failure to take action on implementing benefit changes. Lt. Brown stated that the union's voted on these changes on September 13, 1989. Lt. Brown made the motion that the Trustees of the City of Delray Beach Police & Fire Fighters Retirement System bring a lawsuit against the City of Delray Beach and former Board Trustees to require them to use Chapter 175-185 State Premium Tax monies to provide extra benefits for police and fire fighters as voted by the Board of Trustees on September 13, 1989 and approved by a majority of the empolyees involved in the plan. Sgt. Tustin seconded thelmotion. · ......... ~ -' ' .... · · Mr. Tranter requested that Lt. Brown clarify what the lawsuit was requesting in regard~to former Board Trustee members. After further discussion, Lt. Brown amended the motion. Lt. Brown's amended motion stated the lawsuit would not include former Board Trustees, but bring suit against the City of Delray Beach for action on Chapter 175- 185 monies to be used for extra benefits. Sgt. Tustin seconded the amended motion. A roll call was taken of Board members: 4 Yes, 4 No. The motion failed. (See last page attached for vote results.) 5) OTHER BUSINESS: Approval of Warrants - Officer Arena stated that Warrants #32 & 33 required Board approval. Mayor Lynch made the motion to approve payment of Warrant #32. Officer Arena seconded the motion, all ~n favor, none opposed. Mayor Lynch made the motion to approve payment of Warrant #33. Lt. Brown seconded the motion, all in favor, none opposed. ~F DEL~Y BEACH POLICE & FIRE FIGHTERS ~TIREMENT SYST~ ~19, 1991 5) OTHER BUSINESS: cont'd. Officer Arena stated that per City ordinance 33.66 D (2), Annual Reports shall be made by a certified public accounting firm performing the City's annual audit. Mr. Cypen ~stated that the'accounting' firm .which performs the City's audit ~will accommodate the pension fund and supply the information in a timely manner. Officer Arena stated that per City ordinance 33.66 (9), any over/under payments from the fund to a member or beneficiary caused by error computations shall be adjusted with interest a a rate granted/aproved by the Board. Over-payments shall be charged against payments; under payment shall be made up from the trust fund. Officer Arena stated that the two (2) errors that have been made apply to over- payments and interest should apply. Mr. Cypen stated that the calculation of interest in these two (2) cases is not significant enough to pay for ascertaining what the~ interst would be and then collecting it. Mayor Lynch stated that the SEI report indicated that $18,500.00 was projected for their yearly fee. He wanted to know that since the figure shown is less than projected would the fund have to make-up the difference. Mr. Tranter stated that any shortage not made-up by soft dollars would then be paid by the fund. Meeting adjorned at 4:00pm. The undersigned are the Secretary and Chairman of the Police and Fire Fighters Retirement System, Board of Trustees, and the information provided herein are the Minutes of the Meeting of said body for July 19, 1991, which minutes were formally approved and adopted by the Police and Fire Fighters Retirement System, Board of Trustee~ on //-~O-q~.. , ~~.~ ~i,~.~u,~\, Secretary and x~L'~k~--q--~,k~.w~xX.~) Chairman. ~ ' NOTE TO THE READER: If the minutes that you have received are not complete as indicated above, then this means that these are not the offical minutes of the Police and Fire Fighters Retirement System, Board of Trustees. They will become official minutes only after they have been reviewed and approved, which may involve some amendments, additions or deletions to the minutes as set forth above. COPIES TO: Members of thexBoard City Commissioners City Mgr., David Harden Payroll/Pension Administrator~'' City Attorney, Jeff Kurtz Finance Director, Joe Safford Asst. Finance Director, Melina Walinski Fire and Police Bulletin Boards Agenda Item #4 - Request by Lt. Brown: Discussion of the following- Extra Benefits Results of vote: Mayor Lynch - No Mr. Tranter - No Mr. Weekes - No Chief Lincoln - No Sgt. Tustin - Yes Officer Arena - Yes Lt. Brown - Yes Lt. Adams - Yes Chief Wigderson was not present for the meeting and did not vote. KRUSE, O'CONNOR AND LING ,~c. Fo.T L,,UOE.O^-E OFF,CE WEST EIROWARD PROF""I"'~51ONAL SUILDING 731}O Gr~IFFIN ROAD. ~UIT~ ~OO FORT LAUDERDALE, FLORIDA 33314 IOI SOUTHEAST SECOND PLACE, ~UITE ~OI GAINESVILLE, FLORIDA 3a6OI (904} 375'3800 ~[PLY TO ~O~T LAUD[~DAL[ June 19, 1991 Mr. Salvatore Arena, Secretary Delray Beach Police & Flrefighters Pension Board 300 West Atlantic Avenue Delray Beach, Florida 33444-3666 Dear Mr. Arena: We are writing in response to your April 5, 1991 letter in which you asked for information regarding two matters. First, you asked when police officers and firefighters are considered to be classified employees for actuarial purposes. For our annual actuarial valuation reports, We have always used the date shown in the Annual Report to the State Treasurer's Office. For example, December 28, 1987 is being used in. your case. We presume that the date listed in the Annual Report is the date of hire, however, this should be verified with the finance department, Second, you asked about the financial impact of establishing a minimum non-service incurred disability benefit equal to 25% of pay. This change in benefits would raise the required City contribution $_~1,622,...or 0.02% of covered Payroll, from $1,144,257 to $1,145,879. Please contact us if you have any questions. Sincerely Yours, J. Stephen Palmquist JSP/ m KRUSE, O'CONNOR AND LING x~c. ~ORT L^~OE~O^~E orr,cE WEST BROWARD PROFESSIONAL BUILDING 7320 GRIFFIN ROAD, SUITE 200 F-ORT LAUDERDALE, FLORIDA 33314 NORTH /CENTRAL FLORIDA OFFICE I01 SOUTHEAST ~ECOND PLACE, SUITE ~OI (904) 375 '38OO REPLY TO.FORT LAUDERDALE July 22, 1991 Mr. Salvatore Arena, Secretary Delray Beach Police & Firefighters Pension Board 300 West Atlantic Avenue Delray Beach, Florida 33444-3666 Dear Sah At its July 17, 1991 meeting, the Pension Board asked us to determine the cost effect of eliminating the offset of Social Security benefits against the System's disability benefit. This change would raise the required City contribution by .$17,034, or 0.22% of covered payroll, from. $1,1_44,257 to $1,161,291. Also, .as requested by the Board, we are enclosing a replacement for page I of our October 1, 1990 Actuarial Valuation Report. As you will recall, the headings Of 'Last Valuation' and 'Current Valuation' were transposed. Please contact us if there are any questions regarding these matters. Sincerely yours, i. Stephen Palmquist ' ~ JSP/mm Enclosure Board of Trustees CITY OF DELRA Y BEACH POLICE AND FIREFIGHTERS RETIREMENT SYSTEM 100 N.W. 1st Avenue Delray Beach, Florida 33444 K C iVED MEMORANDUM CITY M~tqfiG£R'S OFFICE TO: DAVID ~IN, CITY ~NAGER SUBJECT: CITY CO~ISSION AGENDA ITEM - REQUESTED O~INANCE C~GE DATE: FEBRUARY 19, 1992 Per your request, attached please find a copy of the Police & Firefighters Retirement System minutes dated January 15, 1992. As indicated in the minutes, the Board voted and approved the the minimum benefit for non-service disability will be 25% and that there would be no social security off-set against disability (Page 2, Item #4 of the minutes). If you should require additional information, please contact me at 243-7841. : acw Attachment CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM MINUTES OF JANUARY 15, 1992 MEMBERS: Mr. Weekes, Lt. Adams, Chief Wigderson, Major Lincoln, Sgt. Tustin, Lt. Brown, Mr. Cypen, Anne Woods, Mr. Duane GUESTS: Mr. Ray Gerner ABSENT: Mayor'Lynch, Officer Arena The meeting was officially called to order at 2:02pm by Major'.Lincoln, 'Vice Chairman. A roll c~ll was t~5~n of members and gues~ Lt. Brown will be arriving lace to tb ~neeting. For the record, the Board did not meet in December 1991. 1. APPROVAL OF NOVEMBER 1991 MINUTES: The minutes were reviewed and corrections made. Lt. Adams made the motion to approve the minutes. Sgt. Tustin seconded the motion, all in favor, none opposed. Lt. Adams stated that for the record, a letter of resignation was received and accepted by the Board from John Trantor. 2. STEVE CYPEN - DISCUSSION OF BOARD COMPOSITION & CONFIDENTIALITY OF MEDICAL RECORDS: Board Composition - Mr. Cypen stated that he received information from the State, Insurance Commissioners office and the City regarding the Boards composition and the State's Opinion is not clear. He stated, with Board approval, he would write a letter to the state specifically requesting clarification on composition of the Board, residency requirements of members and if the Board is in compliance with state statute. Lt. Brown arrived for the meeting at 2:16pm. Major Lincoln passed the gavel to Lt. Brown. Confidentiality of Medical Records - Mr. Cypen stated that medical records, in the absence of a waiver, would not be public doucments; and if t.he waiver is not executed and the records are not public documents th'ere is no exemption from the ~Sunshine Law which requires' public meeting should be held. Mr. Cypen stated that this situation would restrict the Board from being able to openly discuss, at a public meeting, a request for disability. C%TY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM JANUARY 15, 1992 PAGE 2 2. STEVE CYPEN - DISCUSSION OF BOARD COMPOSITION & CONFIDENTIALITY OF MEDICAL RECORDS: cont'd. He presented the Board with a form that would be signed by the person seeking disability. This form would'ahthorize a waiver of ~confidentiality '7of' medical records. Per Mr. Cypen's suggestion, the form will be added to the disability application form presently used. 3. DISCUSSION OF MEMO FROM FINANCE DEPARTMENT - RE: COMPENSATION INCLUDED IN PENSION CALCULATION: Lt. Adams stated that what he was hoping to receive f ,m Finance was a breakdown that would indicateI~how pension benefits would be determined. He stated that the information received was not exactly what he requested. Individual Benefit Statements: Mr. Cypen suggested that generally, for~a fee, the actuary will prepare a benefit statement for members of the plan. Mr. Weekes ~suggested that the Administrative Assistant contact Steve Palmquist who then could determine the cost of preparing the statement. 4. BOARD APPROVAL - REQUEST OF ORDINANCE CHANGE ON THE 25% DISABILITY NON- SERVICE & SOCIAL SECURITY OFF-SET: Lt. Brown stated that the July minutes made reference to the proposed changes, but that a motion and the vote were not verified. The City Manager's office is requesting verification of the Boards approval for the proposed changes to the ordinance. Major Lincoln made the motion to approve the proposal as rendered. Chief Wigderson seconded the motion, all in favor, none opposed. Mr. Cypen stated that he did not recollect the specifics of the 2½% social security off-set. Officer Arena stated that Kruse, O'Connor & Ling sent a letter to the Board on June 17, 1991, which indicated the cost to eliminate the off-set of social security benefits against the systems disability benefit. The cost would be approximately $17,000.00 Mr. Cypen stated that a motion to request a change whereby the minimum benefit for non-service disability will be 25% and that there would be no social security off-set, of any kind, against disability off-set. Major Lincoln amended his original motion to reflect the language Mr. Cypen stated. Chief Wigderson seconded the motion, all in favor, none opposed. CITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM JANUARY 15, 1992 PAGE 3 4. BOARD APPROVAL - REQUEST OF ORDINANCE CHANGE ON THE 25% DISABILITY NON- SERVICE & SOCIAL SECURITY OFF-SET~ cont'd. Mr. Cypen stated that the City should take into consideration that there may be one or more persons currently suffering the off-set and the ordinance change should be drawn in such a way as to apply only to retirees after the effective date of the ordinance change. Mr. Weekes stated his concerns on behalf of Mr. Ray Gerner. He stated that for' months Mr. Gerner has attented pension board meetings with ~elated to his retirement and disability benefit. These numerous problems problems have caused Mr. Gerner both physical and mental harm; and he feels something should be-done to assist Mr. Gerner in rectifying his problems. Lt. Brown stated that he shared Mr. Weekes concerns. He stated that the City has to take immediate action on the ordinance change since the Board has voted twice on this subject. Lt. Brown stated that, as required, an impact study has been obtained showing that there would be a minimal cost impact. Mr. Cypen again stated that Mr. Gerner would have to contact the City concerning his re-imbursement and the payment would be received from the City not the pension fund. Mr. Gerner stated that he contacted the City and was told that the City would not act without the recommendation from the Board. Mr. Cypen asked Mr, Gerner if he had been paid back to the period of time retro- active to Barrigan in 19897 Mr. Gerner stated that he had. Mr. Cypen stated that Mr. Gerner was now relying on the Amsell case which states that re-imbursements are retro-active to the date the off-sets began which would be a period of time prior to Barrigan. He suggested that Mr. Gerner obtain an attorney and force the City to pay him. Mr. Gerner stated he was told by the City (Finance Department) that they would be willing to re-imburse him the additional monies only upon the written request of the Board. Mr. Cypen stated for the record, his opinion is that this is an obligation of the City and not the pension board. Mr. Cypen stated with regard to Mr. Gerner's potential lump sum settlement, it would be appropriate for the Board to request the actuary to determine Mr. Gerner's life expectancy since the Board is required to make the adjustment based upon this information. ~ITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RE'iAREMENT SYSTEM JANUARY 15, 1992 PAGE 4 4. BOARD APPROVAL - REQUEST OF ORDINANCE CHANGE ON THE 25% DISABILITY NON- SERVICE & SOCIAL SECURITY OFF-SET: cont'd. Mr. Cypen stated that after Mr. Gerner were to agree to a lump sum settlement he should return to the Board. At that time, the Board would use the standard acturial tables to obtain his life expectancy and then determine the amount of his monthly pension benefit. 5. IMPACT OF NEW DISABILITY ACT: Mr. Cypen stated that he did not know how this would impact the City's policy, but he felt it would have an impact on the pension fund. Major Lincoln stated that since cities are no longer able to use the medical exam as a pre-screening mechanism for determining if someone is fit for hiring; does the Board have the same responsibility. Meaning does the Board have to allow a person to enter the fund only to have to pay-off on a possible disability request in a short period of time. Mr. Cypen stated that there is a difference between the City and the Board. The Board does not hire. He stated that the Board would have to make sure that the City's physical exam is well done and if any pre-existing condition should exist it should be detailed completely. Also, a copy of the physical exam and the findings should be given to the Board immediately. 6. OTHER BUSINESS: -Officer Shinholt's Disability Request: The Administrative Assistant informed the Board that each physican who administered care was contacted in writing and requested to release a copy of their medical report to Dr. Bebout. Once the reports are received/reviewed by Dr. Bebout an appointment will be scheduled for Officer Shinholt to meet with Dr. Bebout. -Re-imbursement from Mrs. Wickert: The Administrative Assistant informed the Board that Officer Arena sent a letter to Mrs. Wickert requesting the $306.30 re-imbursement. At the next meeting, the Board will be made aware of how Mrs. Wickert wishes to re-pay the money. -Approval of Warrants #42 & 43: Lt. Adams made the motion to approve Warrant #42. Chief Wigderson seconded the motion, all in favor, none opposed. Lt. Adams made the motion to approve Warrant #43. Major Lincoln seconded the motion, all in favor, none opposed. Lt. Brown stated that he is working on locating a new site, possibly City Hall, for the Board to hold their monthly meeting. '~ITY OF DELRAY BEACH POLICE & FIRE FIGHTERS RETIREMENT SYSTEM JANUARY 15, 1992 PAGE 5 6. OTHER BUSINESS: cont'd. Lt. Admas handed-out information on the DROP Plan which he thought could be an added option to the existing retirement. Mr. Cypen explained the concept of the plan, but stated that it was a bargaining item. Mr. Cypen stated that Major Lincoln gave him a memo from Barnett Bank asking if the Board wanted them to contact each receipient requesting confirmation of their name, address and if they are still entitled to receive monthly benefit checks. Th~ charge for this service is $5.00 per receipient. - Mr. Cypen stated that this information could easily be obtained by the Board using an existing form letter. The cost incurred would be substantially less. Mr. Cypen stated that he received the copies of various minutes which involved Chapter 175-185 extra benefit requests. He received the recorded tape of the September 15, 1989 meeting, which he was unable to understand. He stated ~that he did not feel that the action taken in September 1989 was confusing or that there was a question about what was adopted. Mr. Cypen stated that the amended motion, attached to the minutes, is a corrected copy of what was adopted. He asked Lt. Brown to double check the minutes since he previously said that the motion passed was not accurately reflected. Mr. Cypen requested that Lt. Brown give him a copy of the petition and vote taken by the police and fire fighters with regard to the Board filing a lawsuit against the City. Mr. Cypen suggested that possibly he and Lt. Brown request through the City Manager's office to be placed on a City Commission agenda to explain the requests the police and fire fighters have regarding Chapter 175-185 monies being used for extra benefits. The Board agreed with Mr. Cypen, and Lt. Brown will contact the City Manager's office requesting to be placed on the next available agenda. The meeting adjourned at 3:35pm. The undersigned are the Secretary and Chairman of the Police and Fire Fighters Retirement System, Board of Trustees, and the information provided herein are the Minutes of the Meeting of said body for .Tmnumrv 15. lq92 , which minutes were formally approved and adopted ~y--t~e Police and Fire Fighters Retirement System, Board of Trustees on February 19, 1992 , , Secretary and , Chairman. NOTE TO THE READER! If the minutes that you have received are not complete as indicated above, then this means that these are not the official minutes of the Police and Fire Fighters Retirement System, Board of Trustees. They will become official minutes only after they have been reviewed and approved, which may involve some amendments, additions or deletions to the minutes as set forth above. COPIES TO: Members of' the Board Asst. Finance Director, M. Walinski City Commissioners Finance Department, S. Muehlburg City Manager, D. Harden Finance Director J. Safford City Attorney, J. Kurtz Police & Fire Fighters Bulletin Boards TO: David Harden~ DATE: 12-12-91 FROM: Joseph Sa~ SUBJ: Changes in Police and Fire Pension Plan In regard to the requested changes to the Police and Fire Pension Plan by the Police and Fire Pension Board, I have attached copies of the Board Minutes from their meeting of July 19th and September 25th. Please be advised that the minutes of July 19th re- flect that there was a discussion concerning the 25% non-service disability, but I cannot find where any formal motion was made, seconded or approved. The minutes reflect (on page 5) that the Board decided to wait with any motions concerning this item, the grammatical changes and the cost-out summary on the offset deletion. In the minutes of September 25th, the Board motioned and approved the grammatical changes and the increase in the investment in common stock from 50% to 60%-- but, again, no formal motion concerning the 25% non- service disability. The actuaries for the Plan would provide analysis concerning financial impact to the Plan for any proposed changes. Sal Arena included copies of the financial impact statement(s) for the esta- blishment of the 25% non-service incurred disability benefit. The other two proposed changes would have no financial impact to the Plan. cc: Jeff Kurtz ~--b~-~ ~ ~ ~ CITY OF DELRI:IY BEACH 100 N.W. 1st AVENUE · DELRAY BEACH, FLORIDA 33444 · 407/243-7000 MEMORANDUM TO: Sal Arena, Secretary, Police'& Fire Pension Board FROM: David T. Harden, City Manager~7~ SUBJECT: CHANGES IN POLICE AND FIRE PENSION PLAN '- DATE: November 1, 1991 I have asked Joe Safford, our Finance Director, to review the proposed changes in the Police and Fire Pension Plan which you recently submitted to my office. Joe will review the proposed changes from the financial standpoint. I have also asked him to assemble a complete package which we will need to submit to the City Commission, including excerpts from minutes- of the Pension Board where they requested the changes. Once Joe Safford has completed his review and assembled the additional required backup information, I will submit all the materials to the City Attorney's office to draft an appropriate ordinance implementing the proposed changes, then when the ordinance is drafted, I will schedule the matter on a City Commission agenda. DTH:nr c: Joe Safford % Jeff Kurtz THE EFFORT ALWAYS ~V~ATTERS TLETER I~ 'ADMINISTRAT~he,q~OL,ICE ANOF"~C~ A ~BLIC HEARING ~ll ~ ~ ~ DI~K~ ~ THE CITY ~ ~ ~UT~, ~ ~W~ ~ ~- ~, in ~ C~ C~mi~ C~ TAIN GRMTI~L AND VER- S~E CHAKES; PR~IO~K A ~, 1~ N.W. 1~ Av~, ~lray ~w~ c~, ~ ;~=~ ~=~ ~h, at ~h ti~ ~ Ci~ C~mi~ ~ TIVE~TE, ~ will C~M ~r ~. T~ ~I ~ ~Ke M ~ C~ C~K at ~ Ci~ Haft, 1~ N.W. 1~ Av~, ~lray ~h, F~, ~ 8:~ A.M. ~ 5:~ P.M., ~y ~r~h FriMy, exc~ ~li~ys. AIl J~ ~i~ are i~ ~ vi~ ~ a~ a~ ~ ~ard with r~ ~ ~ ~ ~ OrdinaK~ MImNAgCl II0. 24~ ~ ORDINANCE OF THE CITY' MISSION OF THE CITY OF OELRi BEACH, FLORIDA, PURSUANT THE STATE HOUSING PARTNERSHIP (SHIP) PROVIDING FOR DEFINI PROVIDING FOR THE CR OF THE LOCAL ASSIS- TANCE TRUST FUND; ~ FOR THE ESTABLISH,4 OF THE LOCAL HOUSING PARTNER- SHIP; PROVIDING THE IN- TENT AND PURPOSE THE LO- CAL HOUSING ASSI PRO- GRAM; PROVIDING THE ES- TABLISHMENT THE LOCAL HOUSING :E PROGRAM; DESIGNATING TI RESPONSIBILI- TY FOR THE ON AND AOMINIST OF THE LO,. CAL ASSISTANCE PRO- GRAM; lNG FOR THE CRE- ATION OF AFFORDABLE HOUS- ING COMMITTEE; PRO- VIDING GUIDELINES TO BE '* UTILIZED SAID COMMITTEE IN OF RECOMMENDA. TIONS THE AFFORDABLE INCENTIVE PLAN; PRO- FOR THE ADOPTION OF THE ~FFORDABLE HOUSING PLAN; PROVIDING FOR AND PROVIDING A AN ORDINANCE OF THE CITY COM. MISSION OF THE CITY OF DELRAY BEACH, FLORIDA, AMENDING TI. TLE Ill, 'ADMINISTRATION', CHAP- TER 3~, 'POLICE AND FIRE DE- PARTMENTS~, SUBHEADING 'PENSIONS', OF THE CODE OF OR- DINANCES OF THE CITY OF DEL' RAY BEACH, FLORIDA, BY AMENDING THE SECTION 33.~2, 'BENEFIT AMOUNTS AND ELIGI. BILITY", TO PROVIDE FOR CER- TAIN GRAMA~TICAL AND VER- BIAGE CHANGES; PROVIDING A SAVING CLAUSE, A GENERAL RE- PEALER CLAUSE, AND AN EFFEC- TIVE DATE. AN ORDINANCE OF THE CiTY COM- MISSION OF THE CITY OF DELRAY BEACH, FLORIDA AMENDING CHAPTER 4, "ZONING REGULA- TION~J' ~1= 1'~ ~ ~1~ ,',c,,r, ^~