File Ref. #144
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CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH FLORIDA 33139
CITY OF MIAMI BEACH
RETIREMENT SYSTEM FOR
GENERAL EMPLOYEES
(305) 673.7437
FAX: (305) 673.7297
MEMORANDUM
DATE:
April 14, 1999
TO:
Robert Parcher
City Clerk
FROM:
Margaret A. Arculeo YJ;1,
Pension Administrator
RE:
General Employees Retirement System of the City of Miami Beach
Annual Report for 97/98 Plan Year
----------------------------,~-------------------------------------------------------------------------------------
The General Employees Retirement System Ordinance No. 190 I, Article 7, Paragraph (q), provides
for an Annual Report to be filed along with the appropriate statistical information. The report
contains the names of the Board members, how often they meet, their mission, objectives, strategies
and accomplishments as a Board during the past fiscal year. The statistical information is reported
in the Actuarial Valuation as of 10/1/98 and the Independent Auditor's Report as of 9/30/98 attached.
Ifthere are any questions, please do not hesitate to contact me at the Pension Office 673-7437.
/ma
Ene.
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ANNUAL STATUS REPORT
RETIREMENT SYSTEM FOR THE GENERAL EMPLOYEES
OF THE CITY OF MIAMI BEACH
For the Year Ended September 30, 1998
The Board of Trustees. listed below. meet on the second Tuesday of each Month:
James Boyd, Chairman
Georgina Echert
Ronald Helphand, Trustee
Dean Mielke, Trustee
Jorge Montes, Vice Chairman
Mark Slattery, Secretary
Robert Thomas, Trustee
Tom Womble, Trustee
John Woods, Trustee
Term Expires: 9/30/2000
2/28/2002
9/30/2001
10/31/99
2/28/2002
9/30/99
10/31/99
9/30/2001
9/30/99
Elected
Appointed
Elected
Appointed
Appointed
Elected
Appointed
Elected
Elected
The Board of Trustees consists of nine persons; four are appointed by the City Manager, three
Members of the System are elected by Employees who are Members of the System, and two are
Retirants elected by the retired Members of the System Trustees serve for a term of three years with
the annual election of a Chairman and Vice Chairman from its membership and Secretary from the
City Manager's appointees. In September 1998, Ronald Helphand and Tom Womble were re-elected
to three year terms. At their April 14, 1998 meeting the Trustees re-elected Mr. Boyd to act as
Chairman, Mr. Montes as Vice Chairman and Mr. Slattery as Secretary for the Board.
The Trustees are responsible for the proper operation and management of the system and for carrying
out the wishes of the City Commission by administering the provisions of the Pension Plan
Ordinances. They were assisted by contracted professionals in all areas concerning pension. From
the law firm of Cypen & Cypen, Mr. Steve Cypen is legal counsel for the Board and an expert in
pension law.
The Ordinance and Investment Guidelines govern the investment strategy for the Fund's fivesix
investment managers. Mr. Bill Cottle, of Dorn, Helliesen & Cottle, is the fund evaluator and
monitors the managers' perfonnance and compliance with the Investment Guidelines. He reviews this
information and advises the Board through quarterly performance reports. The Trustees evaluated
the asset allocation of the Fund and with the assistance of the Fund Evaluator indexed 50% of the
Equity portion of the Fund and 50% of the Fixed Income portion. The Portfolio is managed by:
I.C.C. Capital Management managing 15% of the assets in equities; RhumbLine Advisers managing
7.5% of the assets in a mid-cap index fund; Gratry & Co. managing 2.5% of the assets in international
investments; RhumbLine Advisers managing 25% of the assets in an S&P 500 Equity Index Fund;
Wellington Management Co. managing 25% of the assets in a core bond position; and PanAgora
Asset Management managing 25% of the assets in an Enhanced Fixed Income Index Fund. The Fund
experienced a real rate of return for the year ended 9/30/98 of approximately 8.4%. Even with the
payment of approximately $12.2 million in pension benefits, lump sum payments and investment and
administrative expenses, the total assets of the Fund were up from $219,626,839 at 9/30/97 to
$228,740,415 at 9/30/98.
ANNUAL STATUS REPORT
For Plan Year Ended 9/30/98
Page 2 of2
The Actuary for the System is the firm of Gabriel, Roeder, Smith & Company, formerly Kruse,
O'Connor & Ling, Inc., located in Fort Lauderdale. The Actuarial Valuation for the Year Ended
9/30/98 has been completed and filed the State Actuary in Tallahassee. The actuary reported that the
City's contnbution rate for 1999/2000 Plan Year will be zero, which is down from 5.19% for the year
prior (98/99). A copy of the Actuarial Valuation has been forwarded to the Budget Department.
An independent audit was conducted by the accounting firm of Spear, Safer, Harmon & Company
located in Miami The auditors statistics reconcile to those reported by the actuary. A copy oftheir
report has been forwarded to the Budget Department. There were no control or material weaknesses
reported from this Audit. The City's Audit Department also completed an Audit of the System in
June 1998. There were no control or material weaknesses reported from this Audit either.
The mission ofthe Board is to properly administer the Plan as directed through the Ordinance and
to insure that the original purpose for which the Pension Ordinance was created, which was to
provide retirement and other benefits for eligible employees of the City and their beneficiaries or
dependents, is accomplished.
The objectives for meeting this mission are to coordinate the desires of the Administration along with
the performance of the Plan's professionals, to continue to maximize investments and to secure a
funding process, assisted by actuarially calculated contributions and closely monitored investments,
to meet the operations and liabilities of the Plan.
The General Retirement System and the Unclassified System share an Administrative Staff of three
employees along with other combined administrative and office expenses. Each System is responsible
for those administrative expenses specifically directed to their System
The System professionally processed the retirement of 40 employees and/or beneficiaries during the
year. The number ofRetirants, Disability Retirees and Beneficiaries total 905. For all those Members
who retired during the fiscal year the following provisions applied:
Normal Retirement Eligibility was age 50 with five years of Creditable Service; benefit was
3% of Final Average Monthly Earnings for the first 15 years of creditable service plus 4% of
Final Average Monthly Earnings for the years thereafter, not to exceed 90%. Final Average
Monthly Earnings was 1/12 of the average annual earnings of the two highest years.
All benefits in pay status for at least 12 months are subject to a 1.5% cost of living increase each year
as of October 1 st. based on the original benefit amount.
Terminated employees or those employees who resigned were eligible to request a refund of
accumulated contnbutions. There were 35 such requests processed for lump sum payments. Vested
Terminations with at least 5 years of creditable service were eligible to request a refund of
accumulated contributions, or receive an accrued benefit beginning at age 50, or at age 62 with less
than five years.
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