BIE - Pension System for Fire and Police (4/26/2024)MIAMI BEACH
City of Miami Beach, 1700 Convention Center Drive, Miami Beach, Florida 33139, www .miamibeachfl.gov
TO: Honorable Mayor Steven Meiner and Members of the City Commission
FROM: Rickelle Williams, Interim City Manager ~ll}
METTING DATE: May 15, 2024
SUBJECT: BUSINESS IMPACT ESTIMATE FOR:
AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA, AMENDING PART 1, SUBPART B, ARTICLE IX, RELATED SPECIAL
ACTS, OF THE MIAMI BEACH CITY CODE ENTITLED "PENSION SYSTEM FOR DISABILITY
AND RETIREMENT OF MEMBERS OF POLICE AND FIRE DEPARTMENTS," BY AMENDING
SECTION 62, "DEFINITIONS," RELATING TO ACTUARIAL ASSUMPTION RATES;
AMENDING SECTION 66, "SERVICE AND DISABILITY BENEFITS GENERALLY;"
RELATED TO IMPLEMENTING THE CONCLUSIVE FIREFIGHTER CANCER PRESUMPTION
ESTABLISHED BY SECTION 112.1816, FLA. STATUTES; AMENDING SECTION 84,
"DISTRIBUTION LIMITATION," PROVIDING FOR INCLUSION OF THE FEDERAL SECURE
ACT 2.0 PROVISIONS; PROVIDING FOR REPEALER, SEVERABILITY, CODIFICATION AND
FOR AN EFFECTIVE DATE.
ls a Business Impact Estimate Required?
[JI"' Yes □No (If no, please check one of the boxes below)
If one or more boxes are checked below, this means the City of Miami Beach has
determined that a Business Impact Estimate for the above-referenced Ordinance is not
required by State law.
[if The proposed Ordinance is required for compliance with Federal or State law or
regulation;
□The proposed Ordinance relates to the issuance or refinancing of debt;
□The proposed Ordinance relates to the adoption of budgets or budget
amendments, including revenue sources necessary to fund the budget;
□The proposed Ordinance is required to implement a contract or an agreement,
including, but not limited to, any Federal, State, local, or private grant or other
financial assistance accepted by the City;
□The proposed Ordinance is an emergency ordinance;
□The Ordinance relates to procurement; or
□The proposed Ordinance is enacted to implement the following:
a. Part II of Chapter 163, Florida Statutes, relating to growth policy, county and
municipal planning, and land development regulation, including zoning,
development orders, development agreements and development permits;
b. Sections 190.005 and 190.046, Florida Statutes, regarding community
B u s in e s s Im p a c t E s tim a te
P a g e 2
development districts;
c. Section 553. 73, Florida Statutes, relating to the Florida Building Code; or
d. Section 633.202, Florida Statutes, relating to the Florida Fire Prevention Code.
If none of the above exceptions apply, this Business Impact Estimate is hereby provided
in accordance with Section 166.041 ( 4 ), Florida Statutes.
1. The Commission Memorandum accompanying the Ordinance and the recitals to the
Ordinance itself, which are attached hereto, provide a more complete summary of the
proposed Ordinance and its purpose.
Attached is the memo from the second reading, ordinance, and actuarial impact
statement.
2. An estimate of the direct economic impact of the proposed Ordinance on private, for-
profit businesses in the City of Miami Beach, if any:
(a) An estimate of direct compliance costs that businesses may reasonably incur;
(b) Any new charge or fee imposed by the proposed Ordinance or for which businesses
will be financially responsible; and
(c) An estimate of the City's regulatory costs, including estimated revenues from any new
charges or fees to cover such costs.
3. Good faith estimate of the number of businesses likely to be impacted by the proposed
Ordinance:
The City of Miami Beach estimates that
by the proposed Ordinance.
N/A businesses are likely to be impacted
14. Additional comments:
Ordina nces - R5 E
MIAMI BEACH
COMMISSION MEMORANDUM
TO:
FROM:
DATE:
Honorable Mayor and Members of the City Commission
Rickelle Williams, Interim City Manager
May 15, 2024
10:30 a.m. Second Reading Public Hearing
SUBJECT: AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, AMENDING PART 1, SUBPART
B, ARTICLE IX, RELATED SPECIAL ACTS, OF THE MIAMI BEACH
CITY CODE ENTITLED "PENSION SYSTEM FOR DISABILITY AND
RETIREMENT OF MEMBERS OF POLICE AND FIRE
DEPARTMENTS," BY AMENDING SECTION 62, "DEFINITIONS,"
RELATING TO ACTUARIAL ASSUMPTION RATES; AMENDING
SECTION 66, "SERVICE AND DISABILITY BENEFITS GENERALLY;"
RELATED TO IMPLEMENTING THE CONCLUSIVE FIREFIGHTER
CANCER PRESUMPTION ESTABLISHED BY SECTION 112.1816,
FLA. STATUTES; AMENDING SECTION 84,
"DISTRIBUTION LIMITATION," PROVIDING FOR INCLUSION OF
THE FEDERAL SECURE ACT 2.0 PROVISIONS; PROVIDING FOR
REPEALER, SEVERABILITY, CODIFICATION AND FOR AN
EFFECTIVE DATE.
RECOMMENDATION
The proposed Ordinance is sponsored by Mayor Meiner and is submitted for
consideration on Second Reading at the May 15, 2024 Commission Meeting. On
April 3, 2024, the Mayor and Commissioners adopted the proposed Ordinance on
First Reading. No changes have been made between First and Second Reading.
A summary of the proposed Ordinance is set forth below.
BACKGROUND/HISTORY
The City of Miami Beach has the following five (5) classified employee groups that
are represented by bargaining units:
• Group I - Represented by the American Federation of State, County and
Municipal Employees (AFSCME) Local 1554;
• Gro up II - Represented by the Fratern al Order of Police (FOP) W illiam
Nichols Lodge No. 8;
• Gro up Ill - Represented by the Intern ational Association of Firefighters
(IAFF) Local 151 O;
• Group IV - Represented by the Communications Workers of America
(CWA)Local3178;and
• Group V - Represented by the Government Supervisors Association of
Florida (GSAF), OPEIU, Local 100
In addition, the City has one classified employee group, Group VI, comprising all
other classifications in the classified service not covered by a bargaining unit. This
group is commonly referred to in the City of Miami Beach as "Others". There is a
seventh salary group comprised of at-will employees commonly referred to as
Unclassified.
Employees represented by the FOP and IAFF are eligible for a defined benefit
pension plan governed by Part I, Subpart B, Article IX, Related Special Acts, of The
Miami Beach City Code entitled "Pension System For Disability And Retirement Of
Members Of Police And Fire Departments."
All other full-time employees are eligible for a defined benefit pension plan
governed by Part I, Subpart B, Article VI, Related Special Acts, of The Miami
Beach City Code entitled "Pension and Retirement System for Officers and
Employees Generally."
Under current law, participants are generally required to begin taking distributions
from their retirement plans at age 72.
Under section 112.1816, Florida Statutes, if a firefighter participates in an
employer-sponsored retirement plan, the retirement plan must consider the
firefighter totally and permanently disabled in the line of duty if he or she meets the
retirement plan's definition of totally and permanently disabled due to the diagnosis
of cancer or circumstances that arise out of the treatment of cancer. The Fire and
Police Pension plan document currently lacks language regarding the cancer
presumption for firefighters.
On May 21, 2020, The Fire and Police Pension Board voted to change the plan's
definition of actuarial equivalence by adopting the recommended long-term interest
rate of 7.5%, effective October 1, 2020.
ANALYSIS
The Administration and the Fire and Police Pension Board wish to amend the Fire
& Police Pension Plan to increase the required minimum distribution age to 73
starting on January 1, 2023. This amendment will bring the plan in compliance with
the Consolidated Appropriations Act of 2023, which contains tax-related retirement
legislation, commonly known as the SECURE 2.0 Act of 2022.
The Administration and the Fire and Police Pension Board wish to amend the Fire
& Police Pension Plan to include the conclusive firefighter cancer presumption
established by section 112.1816, Florida Statutes. This amendment will bring the
plan in compliance with the Florida Statutes and all other applicable laws.
On March 16, 2023, the Fire and Police Pension Board voted to change the plan's
definition of actuarial equivalence by adopting the recommended long-term interest
rate of 7.2% effective October 1, 2023. This amendment will change the actuarial
assumption for the long-term interest rate from 7.5% to 7.2%.
In accordance with Resolution No. 2023-32857, adopted by the City Commission
on December 13, 2023, the following information has been provided by the primary
item sponsor as it relates to the subject ordinance:
1. Was the Agenda item initially requested by a lobbyist which, as defined in Code
Sec. 20481, includes a principal engaged in lobbying? No
2. If so, specify name of lobbyist(s) and principal(s): N/A
SUPPORTING SURVEY DATA
N/A
FINANCIAL INFORMATION
Gabriel Roeder Smith and Company has issued a no-cost actuarial impact
statement based on the attached proposed ordinance (attached).
The Business Impact Estimate (BIE) was provided and published in accordance
with Section 166.041 ( 4 ), Florida Statutes.
CONCLUSION
The Administration recommends amending Part I, Subpart B, Article IX, Related
Special Acts, of The Miami Beach City Code entitled "Pension System For
Disability And Retirement Of Members Of Police And Fire Departments."
Based on the foregoing, the Administration recommends that the City Commission
approve the proposed ordinance on first reading and set the ordinance for second
reading May 15, 2024.
Applicable Area
Not Applicable
Is this a "Residents Right
to Know" item, pursuant to
City Code Section 2-14?
No
Does this item utilize G.O.
Bond Funds?
No
Strategic Connection
Non-Applicable
Legislative Tracking
Human Resources
Sponsor
Mayor Steven Meiner
ATTACHMENTS:
Description
Proposed Ordinance Change
Request for Amendment to the Fire/Police Pension Ordinance
Ordinance
D GRS Letter
954 527 161 6 F 954 5 25.0 0 8 3 ww «.gr con sultin g.com
Ap r i l 3, 2024
Ms. Donna Brito
Executive Director
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
1691 Michigan Avenue, Suite 355
Miami Beach, Florida 33139
Re: Actuarial Impact Statement
Dear Donna:
As requested, we have performed an actuarial review of the attached proposed Ordinance under the City
Pension Fund for Firefighters and Police Officers in the City of Miami Beach.
Based upon our review, we understand the proposed Ordinance:
1. Amends Section 62, the definition of Actuarial Assumptions (for the calculation of optional
forms of benefits) to include an updated interest rate for benefit commencements on or
after October 1, 2023.
2. Amends Section 66, to comply with the cancer presumption requirements of Chapter
112.1816, Florida Statutes, effective July 1, 2019.
3. Amends Section 84, for distribution limitations by providing for inclusion of the Federal
Secure Act 2.0 provisions.
4. Repeals all Ordinances or parts of Ordinances in conflict herewith.
5. Provides for codification.
6. Provides for severability.
7. Provides for an effective date.
In our opinion, based upon the actuarial assumptions and methods to be employed in the October 1, 2023
Actuarial Valuation, the proposed Ordinance is a no cost Ordinance under State funding requirements.
O ne East Broward Boulevard ] Suite 505 ] Ft. Lauderdale, Florida 33301-1804
M s . D o n n a B rito
A p ril 3 , 2 0 2 4
P a g e T w o
If y o u sh o u ld h a v e a n y q u e s tio n co n c e rn in g th e a b o v e o r if w e m a y b e o f fu rt h e r a ss ista n c e w ith th is m a tte r,
p le a s e d o n o t h e s ita te to co n ta c t u s .
S in c e re s t re g a rd s ,
G a b r ie l, R o e d e r, S m it h & C o m p a n y
7tl Jase
Shelly L. Jones, A.S.A., E.A., F.C.A., M.A.A.A.
Consultant and Actuary
Enclosure
cc: Mr. Frank Estevez
O R D I N AN C E N O . 2 0 2 4 -
AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, AMENDING PART 1, SUBPART B, ARTICLE
IX, RELATED SPECIAL ACTS, OF THE MIAMI BEACH CITY CODE
ENTITLED "PENSION SYSTEM FOR DISABILITY AND RETIREMENT OF
MEMBERS OF POLICE AND FIRE DEPARTMENTS," BY AMENDING
SECTION 62, "DEFINITIONS," RELATING TO ACTUARIAL ASSUMPTION
RATES; AMENDING SECTION 66, "SERVICE AND DISABILITY BENEFITS
GENERALLY;" RELATED TO IMPLEMENTING THE CONCLUSIVE
FIREFIGHTER CANCER PRESUMPTION ESTABLISHED BY SECTION
112.1816, FLA. STATUTES; AMENDING SECTION 84, "DISTRIBUTION
LIMITATION," PROVIDING FOR INCLUSION OF THE FEDERAL SECURE
ACT 2.0 PROVISIONS; PROVIDING FOR REPEALER, SEVERABILITY,
CODIFICATION AND FOR AN EFFECTIVE DATE.
WHEREAS, on March 16, 2023, the Fire and Police Pension Board voted to change the
plan's definition of actuarial equivalence by adopting the recommended long-term interest rate;
and
WHEREAS, on March 15, 2023, the Fire and Police Pension Board of Trustees received
a letter from the Florida Division of Retirement requiring a modified ordinance to include the
conclusive firefighter cancer presumption established by Section 112.1816, Florida Statutes; and
WHEREAS, on December 29, 2022, President Biden signed into law the Consolidated
Appropriations Act of 2023, which contains tax-related retirement legislation, commonly known
as the SECURE 2.0 Act of 2022. This Act further increased the required minimum distribution age
to 73.
NOW, THEREFORE, BE IT ORDAINED BY THE MAYOR ANO CITY COMMISSION OF
THE CITY OF MIAMI BEACH, FLORIDA, AS FOLLOWS:
SECTION 1.
That Article IX, Related Special Acts of the Miami Beach City Code, is amended to read:
ARTICLE IX. - PENSION SYSTEM FOR DISABILITY AND RETIREMENT
OF MEMBERS OF POLICE AND FIRE DEPARTMENTS
k $
Sec. 62. - Definitions.
The following words, terms and phrases, when used in this article, shall have the meanings
ascribed to them in this section, except where the context clearly indicates a different meaning:
Actuarial Assumptions (for the calculation of optional forms of benefits) means the
following interest rates compounded annually:
(a) 8.5% for plan years prior to October 1, 2009; 8.4% effective for the plan year beginning
October 1, 2009; 8.3. % effective for the plan year beginning October 1, 2010; 8.2.%
Page 933 of 1644
e ff e c tiv e fo r th e p la n y e a r b e g in n in g O c to b e r 1, 2 0 1 1 ; 8.1 .% e ff e c tiv e fo r th e p la n y e a r
b e g in n in g O c to b e r 1 , 2 0 1 2 ; a n d 8 .0 .% e ff e c tiv e fo r th e p la n y e a rs b e g in n in g O c to b e r
1 , 2 0 1 3, and October 1, 2014;
(b) 7.75% effective for plan years beginning on and after October 1, 2015;
(c) 7 .50% effective for plan years beginning on or after October 1, 2020;
(d) 7.20% effective for plan years beginning on or after October 1, 2023.
k ke k
Sec. 66. - Service and disability benefits generally.
* * k
(j) Nonrebuttable conclusive cancer presumption: The provisions of Section 112.1816,
Fla. Statutes, are hereby codified within the Plan and are intended to be incorporated by
reference. The Board of Trustees shall adopt uniform administrative rules for the conduct
of disability hearings relating to this presumption and for the determination of any
disqualifying events as reflected in the statute.
k k *
Sec. 84. - Distribution Limitation.
* k le
Notwithstanding any other provision of this System, all distributions from this System shall
conform to section 401(a)(9) of the Internal Revenue Code in general and to section 401(a)(9)C)
of the Internal Revenue Code in particular. Notwithstanding any other provision of this plan to the
contrary, a form of retirement income payable from this plan shall satisfy the following conditions:
(a) If the retirement income is payable before the member's death:
(1) For members who attain age 73 70 and on or after January 1, 2020 2023,_provided
the member had not attained age 72 by December 31, 2022,_ it shall either be distributed
or commence to the member not later than Ap ril 1 of the calendar year following the
later of the calendar year in which the member attains age 73 70, or the calendar year
in which the member retires; The Plan will make all future required minimum
distributions in compliance with the prevailing age restrictions and additional
parameters set out in the Internal Revenue Code as amended from time to time;
(2) For members who attain age 70 and on or after January1, 2020, it shall either be
distributed-or commence to the member not later than Ap ril 1 of the calendar year
following- the-later of the calendar year in wh ich the member attains age72, or the
calendar year in which the member retires:
2
Page 934 of 1644
(2) The distribution shall commence not later than the calendar year defined above: and
(a) shall be paid over the life of the member or over the lifetimes of the member and
the member's designated beneficiary or (b) shall be paid over the period extending not
beyond the life expectancy of the member and the member's designated beneficiary.
k- ke k
Where a form of retirement income payment has commenced in accordance with the preceding
paragraphs and the member dies before his entire interest in the plan has been distributed, the
remaining portion of such interest in the plan shall be distributed no less rapidly than under the
form of distribution in effect at the time of the member's death.
(b) If the member's death occurs before the distribution of his interest in the plan has
commenced, the member's entire interest in the plan shall be distributed within five
years of the member's death, unless it is to be distributed in accordance with the
following rules:
(1) The member's remaining interest in the plan is payable to his member's
designated beneficiary.
(2) The remaining interest is to be distributed over the life of the member's
designated beneficiary or over a period not extending beyond the life expectancy
of the member's designated beneficiary; and
(3) Such distribution begins within one year of the member's death unless the
member's Surviving Spouse is the sole designated beneficiary, in which case the
distribution need not begin before the date on which the member would have
attained age 73 70% (age 72 for members who attain or would have attained age
70% on or after January 1, 2020) and if the member's Surviving Spouse dies
before the distribution to the Surviving Spouse begins, this section shall be
applied as if the Surviving Spouse were the member. The Plan will make all future
required minimum distributions in compliance with the prevailing age restrictions
and additional parameters set out in the Internal Revenue Code as amended
from time to time.
(4) Qualification of system. It is intended that the system will constitute a qualified
public pension plan under the applicable provisions of the code for a qualified plan
under code section 401(a) and a governmental plan under code section 414(d),
as now in effect or hereafter amended. Any modification or amendment of the
system may be made retroactively, if necessary or appropriate, to qualify or
maintain the system as a plan meeting the requirements of the applicable
provisions of the code as now in effect or hereafter amended, or any other
applicable provisions of the U.S. Federal Tax Laws, as now in effect or hereafter
amended or adopted, and the regulations issued thereunder. In recognition of the
changing requirements of system qualification, the Board shall adopt an
administrative policy setting forth the required provisions for tax qualification.
Such a policy shall be amended by the Board as required to maintain continuing
compliance with the Internal Revenue Code and that policy and any amendments
shall have the force of law as if adopted by the City Commission.
3
Page 935 of 1644
SECTION 2. REPEALER.
All ordinances or parts of ordinances and all section and parts of sections in conflict
herewith are hereby repealed.
SECTION 3. CODIFICATION.
It is the intention of the City Commission, and it is hereby ordained, that the provisions of
this Ordinance shall become and be made part of the Code of the City of Miami Beach, as
amended; that the sections of this Ordinance may be re-numbered or re-lettered to accomplish
such intention; and that the word "ordinance" may be changed to "section" or other appropriate
word.
SECTION 4. SEVERABILITY.
If any section, subsection, clause or provision of this Ordinance is held invalid, the
remainder shall not be affected by such invalidity.
SECTION 5. EFFECTIVE DATE.
This Ordinance shall take effect ten days following adoption.
PASSED and ADOPTED this d ay of , 2024.
Steven Meiner, Mayor
ATTEST:
Rafael E. Granado, City Clerk
Underline denotes additions
Strikethrough denotes deletions
(Sponsored by Mayor Steven Meiner)
APPROVED AS TO
FORM AND LANGUAGE
& FOR EXECUTION
City Attorney
3Pe lz 4
Date
4
Page 936 of 1644