20160914 SM2MIAMIBEACH
City Gommission Meeting
su PPLEMENTAL MATERTAL 2 (91 13t201 6)
City Hall, Commission Chambers,3'o Ftoor, 1700 Gonvention Center Drive
September 14,2016
Mayor Philip Levine
Commissioner John Elizabeth Alem5n
Commissioner Ricky Arriola
Commissioner Michael Grieco
Commissioner Joy Malakoff
Commissioner Kristen Rosen Gonzalez
Commissioner Micky Steinberg
City Manager Jimmy L. Morales
City Attorney Raul J. Aguila
City Clerk Rafael E. Granado
Visit us at www.miamibeachfl.gov for agendas and video "streaming" of City Commission Meetings.
ATTENTION ALL LOBBYISTS
Chapter 2, Article Vll, Division 3 of the City Code of Miami Beach entitled "Lobbyists" requires the
registration of all lobbyists with the City Clerk priorto engaging in any lobbying activity with the Gity
Commission, any City Board or Committee, or any personne! as defined in the subject Code
sections. Copies of the City Code sections on lobbyists laws are available in the City Clerk's office.
Questions regarding the provisions of the Ordinance should be directed to the Office of the City
Attorney.
SUPPLEMENTAL AGENDA
G7 - Resolutions
CTAM A RESOLUTION DIRECTING THE ADMINISTRATION TO PROVIDE ASSISTANCE TO THE
MAYOR'S AD HOC BLUE RIBBON STEERING COMMITTEE ON THE CONVENTION CENTER
HOTEL, AS NECESSARY, INCLUDING, BUT NOT LIMITED TO, HAVING STAFF FROM THE CITY
PLANNING AND TRANSPORTATION DEPARTMENTS DRAW UP BASIC PLANSiTRAFFIC
OPTIONS FOR VARIOUS SCENARIOS RELATING TO THE LOCATION AND ORIENTATION OF A
CONVENTION CENTER HOTEL.
Commissioner Ricky Arriola
Item moved from R9AG
No additiona! back-up material
C7 AN A RESOLUTION SUPPORTING THE IMMEDIATE IMPLEMENTATION OF THE UNIVERSITY OF
MIAMI BIKE SAFE PROGRAM IN MIAMI BEACH FEEDER PATTERN PUBLIC SCHOOLS.
Commissioner John Elizabeth Aleman
ltem moved from Rg AD
Additional Information
Supplemental 2, September 14,2016
R5 - Ordinances
R5 AE AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH,
FLORIDA, AMENDING PART I, SUBPART B, ARTICLE IX, RELATED SPECIAL ACTS, OF THE
MIAMI BEACH CITY CODE ENTITLED'PENSION SYSTEM FOR DISABILITYAND RETIREMENT
OF MEMBERS OF POLICE AND FIRE DEPARTMENTS,,;AMENDING THE PENSION SYSTEM TO
IMPLEMENT THE COLLECTIVE BARGAINING AGREEMENT WITH THE FIRE FIGHTERS OF
MIAMI BEACH, IAFF LOCAL 1510, FOR THE PERIOD OCTOBER 1,2015 THROUGH SEPTEMBER
30,2018, AND THE COLLECTIVE BARGAINING AGREEMENT WITH THE POLICE OFFICERS OF
MIAMI BEACH, FOP WILLIAM NICHOLS LODGE NUMBER 8, FOR THE PERIOD OCTOBER 1,
2015 THROUGH SEPTEMBER 30,2018; AMENDING SECTION 62, ENTITLED "DEFINITIONS";
AMENDING SECTION 65, ENTITLED "COMPUTATION OF CREDITABLE SERVICE; SERVICE
RECORD,,; AMENDING SECTION 66, ENTITLED SERVICE AND DISABILITY BENEFITS
GENERALLY;AMENDING SECTION 79, ENTITLED "DEFERRED RETIREMENT OPTION PLAN,,;
AMENDING SECTION 82, ENTITLED'MILITARY SERVICE"; AMENDING SECTION 87, ENTITLED
'BENEFITS FOR MEMBERS HIRED ON OR AFTER JULY 14,2010"; AMENDING SECTION 88,
ENTITLED BENEFITS FOR MEMBERS HIRED ON OR AFTER SEPTEMBER 30, 2013; CREATING
A NEW SECTION 89, ENTITLED'BENEF|TS FOR MEMBERS HTRED ON OR AFTER [DATE OF
RATIFICATION OF COLLECTIVE BARGAINING AGREEMENTI"; PROVIDING FOR
SEVERABILITY; REPEALING ALL ORDINANCES lN CONFLICT THEREWITH;AND PROV|DtNG
AN EFFECTIVE DATE.
Commissioner Joy Malakoff
Supplemental updated on 9/1312016
(Memorandum & Ordinance)
Agenda ltem
Date
Miami BikeSafe Program lmplementation Process
1. Principal/AP approval
2. Distribute and complete "Safe Routes to School Student Travel Tallies" in the beginning and end of the
school year.
BikeSafe will provide printed copies for distribution to each home room across the school along
with instructions for the homeroom teacher to complete. We collect them from the school and
compile the data which will be made available to the school. Provides accurate snapshot of
school transportation methods. This will also be very helpful to the City to see if the Ciclovias are
having an impact.
3. Train PE teacher on BikeSafe Curriculum. This can be done in-person or the PE teacher can complete
our online training. http://kidzneurosciencecenter.com/bikesafe-training/
4. PE teacher implements the BikeSafe Curriculum in PE classroom.
The curriculum consists of four, 35-50 minute lessons. We strongly encourage that the lessons
are taught in successive order since this was how the curriculum was design and evaluated.
Each lesson overview page contains a summary of Florida Standards that are met by the
respective lesson. The full curriculum can be found here:
http://kidzneurosciencecenter.com/wp-content/uploads/ed d/2015/12/BikeSafe-PE-Curriculum-
12-01-2015.pdf
5. Complete Curriculum Completion Form (CCF)online:
https://redca p. med.miami.ed u/su rvevs/?s=BNYnVgX88d
This allows us to track implementation across the county and over the years. lt is also an
opportunity for teachers to provide feedback on the curriculum.
c7 AN
Safe R0utes to School:Studen Arriv 'ah'd De a'ffiure
Tcl
+ | CAPITAT=EffiERS,ONLY- BLUE ORBLACK INKONIJ +
School Name:Teacher's First Name:Teacher's Last Name:
Monday's Date (weekMtn
MMND
count was conductedI-rm
YYYY
1 Number of Students Enrolled in CIass:m
15
. Please conduct these counts on turo of the following three days Tuesday, Wednesday, or Thursday.
(Three days would provide better data if counted)
. Please do not conductthese counts on Mondays or Fridays.
. Before asking your students to raise their hands, please read through all possible ans\^/er choices so they will know their choices. Each
Student may only answer once.
. Ask your students as a group the question "How did you arrive at school today?"
. Then, reread each answer choice and record the number of students that raised their hands for each. Place just one character or
number in each box.
. Follow the same procedure for the question oHow do you plan to leave for home after school?'
. You can conduct the counts once per day but during the count please ask students both the school arrival and departure questions.
. Please conduct this count regardless of weather conditions (i.e., ask these questions on rainy days, too).
Step 1.
Fill in the weather conditions and
number of students in each class
Step 2.
AM - "How did you arrive at school today?" Record the number of hands for each ans//er.
PM - "How do you plan to leave for home after school?" Record the number of hands for
each answer.
Key
Weather Student
Tally Walk Bike School Bus Family
Vehicle Carpool Transit Other
S= sunny
R= rainy
O=overcast
Sl{=snow
Number in
class when
count made
Onlywith
lhildren fron
your family
Riding with
children from
rther families
City bus,
subwan etc.
Skate-board,
scooter, etc.
Sample AM s N 2 o 2 3 8 3 3 1
Sample PM R I 9 3 3 8 1 2 z
Tues. AM
Tues. PM
Wed. AM
Wed. PM iiil
Thurs. AM
Thurs. PM
Please list any disruptions to these counts or any unusual travel conditions to/from the school on the days of the tally.
++
Ordinances - R5 AE
AAIAAAI BEACH
TO:
FROM:
DATE:
GOMMISSION MEMORANDUM
Honorable Mayor and Members of the City Commission
Jimmy L. Morales, City Manager
September 14,2016
First Reading
SUBJECT: AN ORDIMNCE OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA, 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,,; AMENDING THE PENSION SYSTEM TO
IMPLEMENT THE COLLECTIVE BARGAINING AGREEMENT WITH THE FIRE
FIGHTERS OF MIAMI BEACH, IAFF LOCAL 15,I0, FOR THE PERIOD OCTOBER1, 2015 THROUGH SEPTEMBER 30, 2018, AND THE COLLECTIVE
BARGAINING AGREEMENT WITH THE POLICE OFFICERS OF MIAMI BEACH,
FOP WILLIAM NICHOLS LODGE NUMBER 8, FOR THE PERIOD OCTOBER 1,
2015 THROUGH SEPTEMBER 30, 2018; AMENDING SECTION 62, ENTITLED.DEFINITIONS";AMENDING SECTION 65, ENTITLED "COMPUTATION OF
CREDITABLE SERVICE; SERVICE RECORD";AMENDING SECTION 66,
ENTITLED SERVICE AND DISABILITY BENEFITS GENERALLY AMENDING
SECTION 79, ENTITLED "DEFERRED RETIREMENT OPTION PLAN";
AMENDING SECTION 82, ENTITLED "MILITARY SERVICE"; AMENDING
SECTION 87, ENTITLED 'BENEFITS FOR MEMBERS HIRED ON OR AFTER
JULY 14, 2010"; AMENDING SECTION 88, ENTITLED BENEFITS FOR
MEMBERS HIRED ON OR AFTER SEPTEMBER 30, 2013; CREATING A NEW
SECTION 89, ENTITLED "BENEFITS FOR MEMBERS HIRED ON OR AFTER
IDATE OF RATTFTCATION OF COLLECTTVE BARGATNTNG AGREEMENTI";
PROVIDING FOR SEVERABILITY REPEALING ALL ORDINANCES IN
CONFLICT THEREWITH;AND PROVIDING AN EFFECTIVE DATE.
RECOMMENDATION
Approve the ordinance on first reading and set a second reading, public hearing for September 27,
2016.
ANALYSIS
The City's worKorce is divided into seven salary groups: (1) those covered by the American
Federation of State, County and Municipal Employees, Local 1554 (AFSCME) bargaining unit;
(2) those covered by the Communications Workers of America, Local 3178 (CWA) bargaining
unit; (3) those covered by the Govemment Supervisors Association of Florida/OPElU, Local
Page 1 135 of 2272
100 (GSAF) bargaining unit; (4) those covered by the Fraternal Order of Police, William Nichols
Lodge No. 8 (FOP) bargaining unit; (5) those covered by the lnternational Association of Fire
Fighters, Local 1510 (IAFF)bargaining unit; (6)those employees who are at-will and are knoinrn
as unclassified; and (7)"Others" (classified service employees not represented by a bargaining
unit).
During the October 1,2012 - September30,2015 contract period, the fire and police unions
agreed to significant pension reform, which yielded a reduction of $145 million to the City's ARC
over a 3O-year period (2013 net present value). The savings attributed to the 2013 pension
reform have aided in the short and long-term sustainability of the plan.
On September 30, 2015, the three-year collective bargaining agreement between the City of
Miami Beach and the IAFF (covering the period of October 1, 2012 through September 30,
2015) expired. The City and IAFF began meeting in August 27,2015 to negotiate a successor
agreement. After seven formal negotiation sessions, on March 4, 2016, the City and IAFF
reached a tentative three-year agreement covering the period of October 1, 2015 through
September 30, 2018. Subsequently, on May 4, 2016, the IAFF confirmed the passage of the
contract by the majority (97 A%) of their voting membership.
On June 8, 2016, the City Commission adopted Resolution No. 2016-29442, accepting the
proposed 2015-2018 labor agreement between the City and IAFF.
On September 30, 2015, the 2012-2015 collective bargaining agreement between the City and
the FOP expired. The parties began negotiating a successor agreement on July 7,2015. After
twelve (12) formal negotiation sessions, on July 12,2016, the City and the FOP leadership
reached a tentative three-year agreement for October 1,2015, through September 30, 2018.
The FOP bargaining unit held a ratification vote from July 15, 2016 through July 18, 2016,
whereby the proposed agreement was approved by 235 of 285 of the bargaining unit members
who voted.
On July 20, 2016, the City Commission adopted Resolution No. 2016-29518, accepting the
proposed 2015-2018 labor agreement between the City and FOP.
After numerous negotiations, the City reached agreements with both the IAFF and the FOP
which include significant pension changes for both cunent and future employees who participate
in the Fire and Police Pension Plan. These changes include the follow.
Pe n si o n Adj u stm e nts/Ch a nges
. Overtime. Off-duty. Accrued Leave and Other Pays -Cunently, employees are not able to
apply overtime, off-duty or any other compensation for the purposes of calculating a member's
retirement benefit that yields a benefit in excess of eleven percent (11%) of the highest
annualized pay rate for the same salary rank that the member is in at time of retirement. This
provision does not apply to members who hold the rank of sergeant or lieutenant on September
30,2013, or any Police Officer promoted to the rank of sergeant prior to the date the 2013
Certified Police Sergeant Promotional Register expired in 2015. As per the 2012-2015
Agreement between the City and FOP, for these members, the inclusion of overtime and/or off-
duty in the member's salary shall be limited to an amount which is equal to 70o/o of the
difference between member's annualized pay rate at retirement and thee highest annualized pay
Page 1 136 of2272
rate for the next higher salary rank.
As agreed to in the 2015-2018 Agreement, if any of the FOP members that were included in the
carve-out of the prior agreement self-demote, their benefit will not exceed eleven percent (11%)
of the highest annualized pay rate for the same salary rank the member is in at the time of
retirement; and overtime, off-duty or any other compensation will not be applied to produce a
benefit that exceeds the eleven percent (11%) limitation.
. Deferred Retirement Option Plan (DROP)and Retiree COLA -
Currently, the maximum DROP participation is five (5) years. Employees in the DROP are
eligible to receive a retiree COLA each year that they participate in the DROP. The rate at which
the member earns his/her annual retiree COLA shall be based on hire date (2.5 percent for all
pre-2010 members and 1 .5 percent for all post-2010 members).
Employees who entered the DROP on or before September 30,2015, who choose to extend
their DROP participation period from five (5) to six (6)years shall receive no retiree COLA (soft
zeros)while in DROP year six (6) effective upon ratification.
Employees who entered the DROP on or after October 1,2015, but prior to the date of
ratification of the Agreements, who choose to extend their DROP participation period from five
(5) to eight (8) years shall receive no retiree COLA (soft zeros) while in DROP years six (6),
seven (7)and eight (8), effective upon ratification.
Each negotiated Agreement had specified a deadline of September 1 , 2016 for the final DROP
extension election date, but as all parties concur that an extension to this deadline be granted
until December 1, 2016, due to administrative needs to complete election forms, the City of
Miami Beach and the Fire & Police unions will enter into an MOU to align the date of this Pension
Ordinance and extend the date specified in the negotiated agreements.
Employees entering the eight (8) year DROP on or after the date of ratification of this
Agreement shall receive no retiree COLA (soft zeros) while in DROP years six (6), seven (7)
and eight (8), effective upon ratification.
Changes for New Emolovees Hired After Ratification
. lncrease the normal retirement age from 50 to 52
. No retiree COLA (soft zeros)during the first four (4) years in DROP
CONCLUSION
The terms and conditions of the proposed three-year labor agreement between the City and
IAFF assumes an estimated impact of $976,783 for FY 2015116; $1,336,228 for FY 2016117;
$2,748,696 for FY 2017118. The total estimated three-year impact is $5,061 ,707.
The terms and conditions of the proposed three-year labor agreement between the City and
FOP assumes an estimated impact of $321 ,410 for FY 2015/16; $417,384 for FY 2016117;
$2,068,198 for FY 2017118.The total estimated three-year impact is $2,806,991 .
Page 1 137 of 2272
The pension reform attained will yield present and future savings to the Fire and Police Pension
Plan, thereby contributing to its short and longterm sustainability. The estimated pension
savings built into the figures above are based on projections provided by the plan's actuary
(Attachment 1). The impact statement provided by the actuary is attached here to (Attachment
2). The administration recommends aapproving the ordinance on first reading and setting a
second reading, public hearing, for September 27, 2016, in order to effectuate the pension
changes that were agreed upon with both the IAFF and FOP.
Legislative Tracking
Human Resources
Sponsor
Commissioner Joy Malakoff
ATTACHMENTS:
Description
o Fire & Police Pension Ordinance
u Attachnent # 1
n Attachrnent # 2
Page 1 138 of 2272
MIAMI BEACH
PENSION FUND FOR FIREFIGIITERS AND POLICE OF'FICERS
ORDINANCE IMPLEMENTING
2015-2018 IAF'F' COLLECTIYE BARGAINING AGREEMENT AND
2OI5.2OI8 FOP COLLECTIVE BARGAINING AGREEMNT
ORDINANCE NO.
AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF
TIIE CITY OF'MIAMI BEACH, F'LORIDA, AMEhIDING 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 F.IRE DEPARTMENTS,,; AMENDING THE
PENSION SYSTEM TO IMPLEMENT THE COLLECTIVE
BARGAINING AGREEMENT WITH THE FIRE FIGHTERS OF'MIAMI BEACH, IAFF LOCAL 1510, F'OR THE PERIOD
ocToBER 1, 2015 THROUGH SEPTEMBER 30, 2018, AND TIIE
COLLECTIVE BARGAINING AGREEMENT WITH THE POLICE
OFFICERS OF MIAMI BEACH, FOP WILIAM NICHOLS
LODGE NUMBER 8, F,OR TIrE PERIOD OCTOBER 1, 2015
THROUGII SEPTEMBER 30, 2018; AMENDING SECTTON 62,
ENTITLED ..DEFINITIONS,,; AMENDING SECTION 65,
ENTITLED ((COMPUTATION OF CREDITABLE SERVICE;
SERVICE RECORD,,;AMENDING SECTION 66, ENTITLED
SERVICE AND DISABILITY BENEFITS GENERALLY;
AMENDING SECTION 79, ENTITLED (DEFERRED
RETIREMENT OPTION PLAN,,; AMENDING SECTION 82,
ENTITLED (MILITARY SERVICE,,; AMENDING SECTION 87,
ENTITLED "BENEFITS F'OR MEMBERS HIRED ON OR AFTER
JULY 14,2010"; AMENDING SECTION 88, ENTITLED BENEFITS
FOR MEMBERS HIRED ON OR AFTER SEPTEMBER 30, 2013;
CREATING A NEW SECTION 89, ENTITLED (BENEF'ITS FOR
MEMBERS HIRED ON OR AFTER [DATE OF' RATIFICATION
OF COLLECTIVE BARGAINING AGREEMENT],; PROVIDING
FOR SEVERABILITY; REPEALING ALL ORDINANCES IN
CONFLICT THEREWITH; AND PROVIDING AN EFFECTIVE
DATE.
BE IT ORDAII\-ED BY THE CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA:
Section 1. Section 62 of Part 1, Subpart B, Article IX, Related Special Acts of the Miami
Beach City Code, is amended to read:
L
Page 1 139 of 2272
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 l, 2009; 8.4o/o effecxive for the plan year
beginning October 1, 2009;8.3% effective for the plan year beginning October tr,
2010; 8,2% effective for the plan year beginning October l, 20ll 8.I% effective for
the plan year beginning October 1, 2012; and 8.0% effective for the plan years
beginning October 1,2013 and October 1,2014;
@ l.l:y*95% effective for the plan yearg beginning on and after October l, 2015;
7'90% effeetive fer the -lan year beginring Oeteber 1,2016; 7,8596 effeetive for the
Actuariol Assumptions (for the calculation of optional forms of benefits) also means the
following mortality tables :
(a) for plan years beginning prior to October 1,,2010, the 1983 Group Annuity Mortality
Table; for plan years beginning on October l,2OlO and October I,2011: for Pre-
Retirement Mortality the RP-2000 Combined Mortaiity Table with a blue collar
adjustment, for Post-Retirement Healthy Mortality the RP-2000 Combined Mortality
Table with a blue collar adjustment, and for Post-Retirement Disabled Mortality the
RP-2000 Combined Mortality Table;
O) for plan years beginning on and after October 1,2072: for Pre-Retirement Mortality the
RP-2000 Combined Mortality Table with a blue-collar adjustment projected 15 years
from valuation date, for Post-Retirement Healthy Mortality tne np-ZbO0 Combined
Mortality Table with a blue-collar adjustment projected 7 years from valuation date,
and for Post-Retirement Disabled Mortality the RP-2000 Combined Mortality Table.
For purposes of determining the period that benefits are paid to a widow or widower
who was maried to a deceased member for less than ten years, the 1994 Life
Expectancy Table shall be used.
(c)
male -1 with
generational mortality improvements projected to the year of commencement with
Scale BB for healthy participants: and for disabled participants. the RP-2000 Disabled
2
Page 1 140 of2272
Mortality Table with a fixed blend of 90% male mortalit), rates - 10% female
mortalitv rates. with no projection for disabled participants For purposes of
determining the period that benefits are paid to a widow or widower who was married
to a deceased member for less than ten years. the following mortality tables shall be
used: RP-2000 Combined Healthy Participant Mortalit), Tables with a fixed blend of
90% male mortality rates - 10% female mortality rates" with fuIl senerational mortalit),
improvements orojected to the vear of commencement with Scale BB for health],
participants: and RP-2000 Disabled Mortalit), Tables with a fixed blend of 90% male
mortality rates - 10% female mortality rates" with no proiection for disabled
participants.
Section 2. Section 65 of Part 1, Subpart B, Article IX, Related Special Acts of the Miami
Beach City Code, is arn*ended to read:
Sec. 65. - Computation of creditable servicel service re.ord.(a) A member's
Creditable Service shall include all periods of employment as an Employee for which
contributions have been made to this System in accordance with subsection (b) below
and section 63(b), together with all service in the uniformed services of the United States
required to be included under section 82; provided, however, that only periods of service
in the uniformed services of the United States for which the member makes the member
contributions as provided for in section 82 shall be Creditable Service for purposes of
computing the amount of the member's benefit from the System. Notwithstanding any
provision to the contrary, in no event shall the same period of service be counted more
than once as Creditable Service under this System, and in no event shall a member
receive Creditable Service under this System for any period of service for which credit
has been received under any other defined benefit retirement plan established by the
City,
(b) Employees who become members of this System in order to receive credit for
service rendered prior to their becoming a member shall make contributions to the Fund
in the amount such member would have contributed had he been a member during the
period of service for which credit is being purohased. In order to receive such credit,
employees shall make payment within six months after becoming a member or within
such other period as may be provided in a bargaining agreement covering the member.
Notwithstanding the foregoing. any employee who transfers to this Slrstem whereby the
accumulated total credit in any other pension system of the Citlt is transferred to this
System. then and in that event. all of the creditable service time in such other s:rstem
shall be considered Creditable Service time under this System. and such employee need
make no additional contribution for time credited.
pre+i
all.e*e*
3
Page 1 141 of 2272
(c) The Board shall establish the service record of all employees who may be entitled
to participate in the benefits of this System, and shall keep a record thereof.
Section 3. Section 66 of Part 1, Subpart B, Article IX, Related Special Acts of the Miami
Beach City Code, is amended to read:
Sec. 66. - Service and disability benefits generally.
't**
(d) For pu{poses of determining a member's benefit, the average monthly Salary of
members who attains eligibility for retirement under subsection (a) above on or before
September 30,2015, shall be based on the average of the two highest-paid years of the
member prior to the date of retirement or termination, or the average of the last two
paid years of the member prior to the date of retirement or termination, whichever
produces the greater benefit for members employed by the City before }ilay 19,1993,
and shall be based on the average of the three highest paid years of the member prior
to the date of retirement or termination for May 1993 Members. Effective September
30,2015, the average monthly salary for members hired before July 14, 2010, who do
not attain eligibility for retirement under subsection (a) above on or before September
30,2015, shall be based on the average ofthe three highest paid, years or the average
of the last three (3) years of the member prior to the date of retirement or termination,
whichever produces the greater benefit. The average monthly salary for Members
hired on or after July 14, 2010, but prior to September 30,2013, shall be based on the
average of the three highest paid years or the average of the last three (3) years of the
member prior to the date of retirement or termination, whichever produces the greater
benefit. The average monthly salary for Members hired on or after September 30,
2013, shall be based on the average ofthe five (5) highest paid years or the average of
the last five (5) years of the member prior to the date of retirement or termination,
whiohever produces the greater benefit. For purposes of such calculation, Salary shall
be the Salary upon which the member's contribution to the System was computed, as
provided in paragraphs (l) md (2) below:
(1) With respect to a firefighter member employed before May 19, 1993, and retiring
on or after October 7, 1994, the inclusion of overtime in the member's Salary for
the applicable average monthly salar), period
@, shall be limited in each year to an amount which, when
combined with compensation for off-duty services and the value of any accrued
siok and/or vacation leave that is included in a member's Salary for pension
contribution and benefit purposes, is equal to 11% ofthe highest annualized pay
rate for the same salary rank that the member is in at time of retirement. Effective
July 14, 2010, all compensation received by a firefighter member who is eligible
for overtime pay and who receives pay for off-duty services performed after that
date for which compensation is received through the City shall be included in
4
Page 1 142of2272
such member's Salary for pension contribution and benefit purposes; provided, in
no event shall such compensation for off-duty services, in combination with any
overtime pay and the value of any accrued sick and/or vacation leave included in
a member's Salary for pension oontribution and benefit purposes, exceed ll% of
the highest annualized pay rate for the same salary rank that the member is in at
time of retirement. For firefighter members who are eligible for overtime pay and
who retire on or after September 30, 2010, upon reaching eligibility for
retirement, a member may elect to apply unused sick and/or vacation leave for
inclusion in the member's Salary for pension contribution and benefit purposes, at
a cost of 1.0% of the value of the unused sick and/or vaoation leave (at the
member's current hourly rate), Provided, in no event shall the value of such
unused sick and/or vacation time, when combined with any overtime pay and
compensation for ofl'-duty services included in a member's Salary for pension
contribution and benefit purposes, exceed 1 1% ofthe highest annualized pay rate
for the same salary rank that the member is in at time of retirement.
Notwithstanding the foregoing, effective September 30, 2013, overtime pay in
excess of 300 hours per calendar yeat, payments for unused sick and vacation
leave, hazardous duty pay (when paid), and payments relating to the domestic
partner tax credit reimbursement, shall be excluded from a firefighter member's
Salary for pension contribution and benefit purposes.
(2) With respect to a police officer member employed before May 19, 1993, and
retiring on or after October 1, 1994, the inclusion of overtime in the member's
Salary for the applicable average monthlv salary period@
, shall be limited in each year to an amount
which, when combined with compensation for off-duty services and the value of
any accrued sick and/or vacation leave that is included in a member's Salary for
pension contribution and benefit purposes, is equal to 70Yo of the difference
between the member's annualized pay rate at retirement and the highest
annualized pay rate for the next higher salary rank; but in no event shal1 such
member's accrued benefit 0n his date of retirement be less than the benefit he had
accrued as of September 30, 1994, determined under the terms of the System in
effect on that date. Effective July 14,2010, all compensation received by a police
officer member who is eligible for overtime pay and who receives pay for off-
duty services performed after that date for which compensation is received
through the City, shall be included in such member's Salary for pension
contribution and benefit purposes; provided, in no event shall strch compensation
for off-duty servioes, in combination with any overtime pay and the value of any
accrued sick andlor vacation leave included in a member's Salary for pension
contribution and benefit puposes, exceed 70Yo of the difference between the
membet's annualized pay rate at retirement and the highest annualized pay rate
for the next higher salary rank; but in no event shall such member's accrued
benefit on his date of retirement be less than the benefit he had accrued as of
September 30, t994, determined under the terms of the System in effect on that
date. For police offrcer members who are eligible for overtime pay and who retire
5
Page 1 143 of 2272
on or after September 30,2010 and before September 30,2013, upon reaching
eligibility for retirement, a member may elect to apply unused sick and/or
vacation leave for inclusion in the member's Salary for pension contribution
purposes, at a cost of 10% ofthe value ofthe unused sick and/or vacation leave
(at the membor's current hourly rate). Provided, in no event shall the value of
such unused sick and/or vacation time, when combined with any overtime pay
and compensation for off-duty services included in a member's Salary for pension
contribution and benefit purposes, exceed 70Yo of the difference between the
member's annualized pay rate at retirement and the highest annualized pay rute
for the next higher salary rank; but in no event shall such member's accrued
benefit on his date of retirement be less than the benefit he had accrued as of
September 30,1994, determined under the terms of the System in effect on that
date, Notwithstanding the foregoing, effective Septernber 30,2013, overtime pay
in excess of300 hours per calendar year, payments for unused sick and vacation
leave, hazardous duty pay (when paid), payments relating to the domestic partner
tax credit reimbursement, and payments for voluntarily participating in a physical
fitness assessment program offered by the City shall be excluded from a police
officer member's Salary for pension contribution and benefit pu{poses; and in no
event shall compensation for off-duty services, in combination with overtime pay
not exceeding 300 hours per calendar year, exceed ll% of the highest annualized
pay rute for the same salary rank that the member is in at time of retirement.
Provided, the llYo limitation in the preceding sentence shall not apply to any
member who holds the rank of sergeant or lieutenant on September 30, 2013, or
any police officer who is promoted into the position of police sergeant prior to the
date the 2013 Certified Police Sergeant Promotional Register expires in 2015.
Notwithstandine any other provision of this paraeraph (2)" effective ldate of
ratification of collective bargaining agreementl. with respect to any member
excluded from the eleven percent (11%) limitation by operation of the preceding
sentence. if such member self-demotes the amount of compensation for off-du4r
services. in combination with overtime pay not exceeding 300 hours per calendar
year. included in such member's Salary ffi shall not exceed
1 1% of the highest annualized pay rate for the same salary rank that the member
is in at time of retirement: and overtime. off-duty or any other compensation shall
not be applied to produce a benefit that exceeds the eleven percent (11%)
limitation.
Section 4. Section 79 of Part t, Subpart B, Article IX, Related Special Acts of the Miami
Beach City Code, is amended to read:
Sec. 79. - Deferred Retirement Option Plan (DROP).
?t*il
(b) Conditions of eligibility. Upon becoming eligible to participate in the DROP, a
mernber who enters the DROP before September l, 2072, may elect to enter that
6
Page 1 144 of 2272
plogram for a period not to exceed 36 months. Notwithstanding, DROP participation
for members who enter the DROP before September l, 20i2, may not continue
beyond the date when the member's combined years of creditable seryice and time in
the DROP equals 352 months (387 months for members who were members prior to
July 1, 1,976). Members who enter the DRoP on or after september l,2olz, shall be
eligible to participate for a period not to exceed sixty (60) months. Notwithstanding,
for those members who enter the DROP on or after September 1,2012, participation
may not continue beyond the date when the member's combined years of creditable
service and time in the DROP equals 456 4O8 months.; Provided. members who enter
the DROP on or before September 30. 2015 ma], extend their DROp participation
Period by 12 months. for a total maximum DROP participation period not to exceed
seventy-two (72) months: provided further. members who enter the DROP on or after
October 1. 2015 but prior to ldate of ratification of collective barsaining aereementl.
may extend thefu DROP participation period by up to 36 months" for a total maximum
DROP participation period not to exceed ninetv-six (96) months; and provided
further. members who enter the DROP on or after [date of ratification of collective
bareainine aereementl may participate in the DROP for a period not to exceed ninet)r-
six (96) months. Provided also that participation in DROP shall require the member to
complete and submit the following prior to start of DROP payments:
1.Such forms as may be required by the Board or Plan Administrator. Election of the
DROP is irrevocable once DROP payments begin. Members who are participating
in the DROP on ldate of ratification of collective bargaining agreement] and elect
to extend their DROP participation period must complete such forms as are
required by the Board no later than December 1. 2016,
A waiver and an irrevocable resignation from employment with the actual date of
termination being the date designated by the member as the end of hislher DROP
participation. The administration and timing of execution and delivery of the
waiver and resignation forms shall meet the requirements of the Age
Discrimination in Employment Act and the Older Worker's Benefits Protection
Act, as same may be amended from time to time.
(e) Payments to DROP account. A DROP account shall be created for each member who
elects to participate in the DROP. A DROP account shall consist of amounts
transferred to the DROP from the Plan, which include the monthly retirement benefits,
including any future cost of living increases, that would have been payable had the
member elected to cease employment and receive a normal retirement benefit upon
commencing participation in the DROP, and earnings on those amounts. Provided,
members who enter the DROP on or after September 7,2012, and before September
30,2013, shall receive a zero percent (0%) cost of living adjustment for the third (3rd)
and fourth (4th) annual adjustment dates, regardless of whether the member remains in
the DROP for the maximum DROP participation fiveJiear period. Provided further,
and notwithstandinq any other provision of the System. any *ueh member who enters
7
Page 1 145 of 2272
2.
DROP Participation. he/she shall not receive a cost of living adjustment on the sixth
annual adiustment date" but shall receive a cost of living adjustment on the seventh
annual adjustment date and each annual adjustment date thereafter. Provided further.
and notwithstanding anv other provision of the System. a member who enters the
DROP on or after October 1. 2015 but prior to [date of ratification of oollective
bargaining agreement]. and elects to extend their DROP participation period b), up to
ll recei n
if
DROP participation. he/she shall not receive a cost of livine adjustment on the annual
ad-iustrnent date next following separation of employment. but shall receive a cost of
ustment on . Provi
time w of DROP
Participation. heishe shall not reseive a cost of living adjustment on the afltual
adjustment date next following separation of employment" but shall receive a cost of
living adjustment on each annual adjustment date thereafter. ffi
11}g
(g) Payment of DROP account funds. Upon termination of a member's employment (for
any reason, whether by retirement, resignation, discharge, disability, or death), the
retiremcnt benefits payable to the member or to the member's beneficiary shall be paid
to the member or beneflciary and shall no longer be paid to the member's DROp
account' No payments will be made from the DROP account until the mernber
terminates employment. In the event of the member's death. payment shall be made
directly to the member's beneficiary,
R
Page 1 146 of 2272
such
ustment
further
(k) [Retaining of earned balance of accrued leave.] A member who enters the DROP on
or after September 30, 2013, shall retain the earned balance of accrued sick and
vacation leave as of date of enhy into the DROP, and shall continue to earn sick and
vacation leave during the DROP period, in accordance with the collective bargaining
agteement between the City and IAFF, and between the City and FOP, as applicable.
While in the DROP, the member shall have the one-time option of receiving payment
for acorued sick and/or vacation leave, up to the maximum payout upon separation of
employment allowed by the applicable collective bargaining agreement; provided,
the member shall retain at least one hundred twenty (120) hours of accrued sick leave
after such payment, The one-time election to receive payment of leave balanoes shall
be made in any one year of the DROP, by notifying the City no later thanAuggg|l!
June4e of that year (unless an alternate date as determined by the City and the
president of the respective bargaining unit). Employees may request such payment
prior to entry into the DROP. but must be in the DROP at the time of paLout.
Payment will be made @ pay period endiftg p:Li"€eteber
February of the same followins year. Upon final separation from employment with
the City, a member who has participated in the DROP shall be eligible to receive
payment for the balance of all accrued sick and vacation leave as of the date of final
separation, up to the maximum provided in the collective bargaining agreement, as
rcduced by the prior payout, if any. In no event shall payments for accrued sick or
vacation leave be included in such member's Salary for the purposes of contributions
and benefits under the System.
Section 5. Section 82 of Part 1, Subpart B, Article IX, Related Special Acts of the Miami
Beach City Code, is amended to read:
Sec. 82. - Military service.
(b) Effective September 30, 2013, members, who have at least 5 years but not more than
10 years of Creditable Service under the System on @ date, may
contribute an additional amount to the System in order to receive service credit for years of
active military service in the U,S. Army, Navy, Air Force, Marines or Coast Guard
occuming prior to their date of employment with the City. A member may purchase up to
two years of such service, The price for each such year shall be l0% (10.5% lbr members
hired on or after September 30,2013) of the aggregate of the member's Salary during the
12 calendar months immediately preceding the date of sueh purchase; and such price shall
be prorated accordingly if a member's election includes a fractional year of service. Any
additional benefits attributable to service purchased under this subsection (b) shall be at the
benefit multiplier rate of 3%o per year of Creditable Service, with a total maximum
additional benefit of 6% based on two years of Creditable Service purchased. The purchase
of Creditable Service under this subsection (b) for police officer members with 5 or more
9
Page '1147 o12272
years of credited service on September 30. 2013 must be completed within 36 months
following September 30, 2013. The purchase of Creditable Service under this subsection
(b) for police officer members with less than 5 vears of credited service on September 30.
2013 must be completed within 36 months following the date the member completes 5
years of Creditable Service ieE
M. The purchase of Creditable Service under this subsection (b) for
firefishter members with 5 or more years of credited service on September 30. 2013 must
be completed within 24 months follor,ving September 30. 2013. The purchase of Creditable
Service under this subsection (b) for firefiehter members with less than 5 )rears of credited
service on September 30. 2013 must be completed within 24 months following the date the
member completes 5 ]rears of Creditable Service. A member who does not complete and
fully pay for the purchase of Creditable Service under this subsection (b) within the
applicable time period specified herein
shall not receive
Creditable Service for more than the amount for which payment has been made, and shall
not be eligible to purchase Creditable Servioe for prior military service in the future.
Section 6. Section 87 of Part 1, Subpart B, Article IX, Related Special Acts of the Miami
Beach City Code, is amended to read:
Sec. 87. - Benefits for employees hired on or after July 14, 2010 and grior to September
30.2013.
The pension benefits for employees hired on or after July 14, 2010 and prior to September
30.2013, shall be as provided in the sections 61 through 86, except as follows:
(a) The benefit multiplier shall be three percent (3%) for each year of creditable service for
the first 20 years ofservice, and four percent (4%) fot each year ofcreditable service after
20 years ofcreditable service.
(b) The normal retirement date shall be as provided in sec. 66, except that a member must
complete at least five ),ears of creditable service" and must attain age 48 to be eligible for
"Rule of 70" retirement.
(c) Final average monthly salary shall be based on the three (3) highest paid years or last
three (3) years as the case may be, prior to retirement or separation from employment.
(d) The cost of living adjustment shall be one and one-half percent (1.5%) annually.
(e) A member shall be vested upon completion of five years of creditable service.
€IThe maximum pension benefit shall be as provided in section 11-66(e).
U+emUers *e e*er tne B+
fo" ttre third (3rd) ffi+tu
whe exits the DROP within srN (6) menths follewkrg the date ef DROP entry; shall be
@
10
Page 1 148 of 2272
Section 7. Section 88 of Part 1, Subpart B, Article IX, Related Special Acts of the Miami
Beach City Code, is amended to read:
Sec. 88. - Benefits for members hired on or after September 30, 2013 and prior to [date of
ratification of collective bargainine agreementl.
Notwithstanding any other provision of the System, the pension benefits for members
hired on or after September 30,2A13 2013 and prior to [date of ratification of collective
bargaining agreementl shall be as provided in the sections 61 through 86, except as
follows:
(a) The benefit multiplier shall be three percent (3%) for eaoh year of creditable
service for the first 20 years of service, and four percent (4%) for each year of
creditable service after20 years ofcreditable service.
(b) The normal retirement date shall be as provided in sec. 66, except that a member
must complete at least five years of creditable service. and must attain age 48 to be
eligible for "Rule of 70" retirement.
(c) Final average monthly salary shall be based on the five (5) highest paid years or
last five (5) years as the case may be, prior to retirement or separation from
employment.
(d) The cost of living adjustment shall be one and one-half percent(l.5Yo) annually.
(e) A member shall be vested upon completion of five )rears of creditable service,
(fl The maximum pension benefit shall be as provided in section 1l-66(e).
Section 8. A new Section 89 of Part 1, Subpart B, Article IX, Related Special Acts of the
Miami Beach City Code, is created to read:
Seo, 89. - Benefits for members hired on or after ldate of ratification of collective
bargainine agf, eement]=
Notwithstanding any other provision of the System. the pension benefits for
members hired on or after [date of ratification of collective bargaininq agreement] shall be
as provided in sections 61 through 86. except as follows:
(a) The benefit multiplier shall be three percent (3%) for each year of creditable
service for the first 20 years of service. and four percent (4olo) for each ),ear of
creditable service after 20 years of creditable service,
(b) The normal retirement date shall be upon attainment of age 52 with five or more
years of creditable service. or when the sum of a member's age plus years of
creditable service equal 70 or more. provided the member has attained age 48.
(c) Final average monthly salary shall be based on the five (5) highest paid years prior
to retirement or separation from employment,
Ll_
Page 1 149 of 2272
(d) The cost of living adjustment shall be one and one-half percent (1.5%) annually.
(e) The maximum pension benefit shall be as provided in section 11-66(e) 85%-ef+he
emptevme*
(fl A member shall be vested upon completion of five years of creditable service.
(g) The member oontribution shall be ten and one-half percent (10,5%) of Salar)..
Section 9. Conflicts and Severability.
(a) All Ordinances, and parts of ordinances, in conflict herewith shall be and
the same, are hereby repealed.
O) In the event any article, section, paragraph, sentence, olause, or phrase of
this Ordinance shall be adjudicated invalid or unconstitutional, such adjudication shall in
no manner affect the other articles, sections, paragraphs, sentences, olauses or phrases of
this Ordinance, which shall be and remain in full force and effect as fully as if the item so
adjudged invalid or unconstitutional was not originally a part hereof.
Section 10. Codification. This Ordinance shall be codified in the Code of Ordinances of
the City of Miami Beach.
Section 11. Effective date. This Ordinance shall take effect ten days following adoption,
except as otherr,vise specified herein.
PASSED and ADOPTED by the City Commission of the City of Miami Beach this
day of 2016.
PHILIP LEVINE
MAYOR
ATTEST:
RAFAEL E. GRANADO
CITY CLERK
(Sponsored by Commissioner Joy Malakoff)
APPROVED AS TO
FORM & LANGUAGE
& FOR EXECUTION
l2
Page 1 150 of 2272
slts
Dotc
GRS Gabriel Rocdcr Smith Er Company onc Lhsr lJrorrnrd lltvd, 954,527,1616 phonc
Consulranrs & Acrunrics Suitc 505 954.52J,008J fax
Ft.Lauderdalc,FL3330l'l8M rvlrv.gabriclrmdcr.com
December 14,2015
Mr. Jose del Risco
Assistant Director
Department of Human Services
City of MiamiBeach
1700 Cbnvention Center Drive
Miami Beach, Florida 33139
Re: Actuarial Study - Extend Maximunr DROP Participation
Dear Jose:
As requested, we are pleased to enclose six copies of our Actuarial Study as of October 1,2014
illustrating the financial impact of potential future changes in the maximum allowable years to
participate in the DROP under the City Pension Fund for Firefighters and Police Officers in the
City of Miami Beach.
Puroosq- We understand the City is interested in the financial impact of increasing the
maximum DROP period from five (5) years to eight (8) years (six (6) years if DROP end date is
prior to October l, 201 8). Any participant remaining in the DROP for more than five (5) years
will not receive an annual Cost of Living Adjustment (COLA) for the additional DROP
participation year(s) - annual COLA will be paid following exit of the DROP progam.
Backsround - Cument maximum allowable years of DROP participation is five (5) years.
Modekd Chanpes - Extension of maximum allowable DROP participation.
Baseline - Current Fund
r Maximum DROP participation is five (5) years
o Retiree receives an annual COLA for allyears while in DROP
Pronos.g! - Extension of maximum DROP participation
r Extension of maximum DROP participation to eight (8) years for members whose
DROP end date is on or after October l, 201 8
r Extension of maximum DROP participation to six (6) years for members whose
DROP end date is on or before September 30,2018
o Retiree will not receive annual COLA during years six (6), seven (7), and eight (8)
while in DROP
Page 1 151 of 2272
ATTACHMENT # 1
Mr. Jose del Rico
December 14,2015
Page Two
Results - The attached Exhibit sets out key financial results of our Actuarial Study. The
following sets out the deoease in minimum annual required first year City contribution. The
figures in parentheses is the decrease in minimum annual required first year City contribution
expressed as a percentage of projected eovered annual pensionable payroll without and with
DROP payroll, respectively ($50,491,405 / $50,464,591).
Extend maximum allowable DROP participation -
no COLA while in DROP for years beyond five
$ l,0l3,gog
(2,0%tt.7w
Actuario! Assumptions and Methods, Fund Plovisions, Financial Dala and Member Census
Dota
The actuarial assumptions and methods, member census and financial data and Fund provisions,
unless specified otherwise, for purposes of our Study are the same actuarial assumptions and
methods, member census and financial data and Fund provisions outlined in the October 1,2014
Aotuarial Valuation Report.
80% of future retirees are assumed to participate in the DROP. DROP members are assumed to
exit the DROP as shown in the following table:
DROP end date is on or
after October l, 20 I 8
DROP end date is on or
before September 30, 20 I 8
Leave DROP prior to 5 years 0%0%
Leave DROP after 5 years 5%5o/o
Leave DROP after 6 years 5%100%
Leave DROP after years l0o/o N/A
Leave DROP after 8 years r00%N/A
This Actuarial Study applies the same retirement rate assumption as the October 1,2014
Actuarial Valuation Report. However the extension of the DROP may alter the retirement
experience of the plan causing a change in the retirement rates assumption in the future,
DROP assumptions will need to be monitored in light of future DROP experience.
This Actuarial Study describes the financial effect ofthe proposed changes on the Fund, from a
neutral perspective. It is not intended as a recommendation in favor of nor in opposition to the
change.
Gabriel Roeder Smi6 & Company
Page 1 152 of 2272
Mr. Jose del Rico
December 14,2015
Page Three
This Actuarial Study only provides the first year financial effect of the proposed changes to the
Fund. In order to have a more complete understanding of the potential cost or savings of these
changes, we recommend a projection study over a longer period (ex, thirty years) be performed.
Consideration may also be given to performing the Study under alternate future DROP
participation assumptions in order to understirnd the implications of experience differing from
the assumption.
The Unfunded Actuarial Accrued Liability shown may not be appropriate for assessing the
sufficiency of Fund assets to meet the estimated cost of settling benefit obligations but may be
appropriate for assessing the need for or the amount of future contributions.
These calculations are based upon assumptions regarding future events, However, the Fund's
long term costs will be determined by actual future events, which may differ materially from the
assumptions made. These calculations are also based upon present and proposed Fund
provisions that are outlined or referenced in this Actuarial Study. If you have reason to believe
the assumptions used are unreasohable, the Fund provisions ar. incoirectly described or
referenced, important Fund provisions relevant to this proposed Actuarial Study are'not
described or that conditions have changed since the calculations were made, you should contact
the undersigned prior.to relying on information in this Actuarial Study.
If you have reason to believe that the information provided in this Actuarial Study is inaccurate,
or is in any way incomplete, or if you need further information in order to make an infonned
decision on the subject matter of this report, please contact the undersigned prior to making such
decision,
Future actuarial measurements may differ significantly from the current measurements presented
in this Actuarial Projection Study due to such factors as the following: Fund's experience
differing from that anticipated by the economio or demographic assumptions; changes in
economic or demographic assumptions; increases or deereases expected as part of the natural
operation of the methodology used for these measurements and changes in Fund provisions or
applicable law. Due to the limited scope of the actuary's assignment, the actuary did not perform
an analysis of the potential range of such future measureme nts.
This Actuarial Study should not be relied on for any purpose other than the purpose described in
the primary communication. Determinations of the financialresults associated with the benefits
described in this Projection Study in a manner other than the intended purpose may produce
sign ifi cantly di fferent results,
This reporl may be provided to parties other than the City only in its entirety and only with the
permission of an approved representative of the City.
Gabriel Roeder Smith & Company
Page 1 153 of 2272
Mr. Jose del Rico
December 14,2015
Page Four
The signing actuaries are independent of the Fund Sponsor and are Members of the American
Acaderny of Actuaries and meet the Qualification Standards of the American Academy of
Actuaries to render the actuarial opinion contained herein.
If you should have any question concerning the above or if we may be of further assistance with
this matter, please do not hesitate to contact us.
Sincerest regards,
X3 .*\.-t"**,%% A, A4-*
Lawrence F, Wilson, A.S,A. Kelly L. Adams, A,S.A.
Senior Consultant and Actuary Consultant and Actuary
Enclosure
cc: Ms, Donna Brito
' Cabriel Roeder Smith 6c Company
Page 1 154 of 2272
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Consultants & Acrulrici Suiic 505 954.525,0081 fox
Ft.Lauderdalc,tLlS30l-18O4 rvsrv.grbriclrocdcrtorn
January 7,2016
Mr. Jose del Risco
Assistant Director
Depaftment of Human Services
City of MiamiBeach
1700 Convention Center Drive
Miami Beach, Florida 331 39
Re: Actuarial Study - Proposed COLA Component of Salary Increase
Dear Jose:
As requested, we are pleased to enclose six (6) copies of our Actuarial Study as of October l,
2014 illustrating the financial impact of potential future changes in the Cost of Living
Adjustment (COLA) component of assumed salary increases under the City Pension Fund for
Firefighters and Police Officers in the City of Miami Beach,
PwDose- We understand the City is interested in the financial impact of proposed future COLA
adjustments to salary.
Background - Current COLA component assumed adjustments to future salary are 3% effective
Ootober I , 201 5 and 2,18% effective each October I thereafter.
Assutltption Chanees - COLA component adjustments to future salary:
Baseling - Curent assumptions
. 3Yo effective October 1 , 20 1 5
o 2.18% effective each October I thereafter
Proposed - assumptions
o 2Yoeffective April 1,2016
. 3Yo effective October 1,2016
o 3Yo effective October 1,2017
o 2.18% effective each October I thereafter
Results - The attached Exhibit sets out key financial results of our Actuarial Study. The
following sets out the increase in minimum annual required first year City contribution. The
figures in parentheses is the increase in minimum annual required first year City contributiotr
Page 1 156 of 2272
Mr. Jose del Rioo
January 7,2016
Page Two
expressed as a percentage of projected covered annualpensionable payrollwithout and with
DROP payroll, respectively ($50,491,405 / $60,464,591),
Proposed COLA component of future salary
increases
$74,655
(0.1o/, /0.1%)
Agtuarial Assumptions o4d Methods, Fund Provisions, Financiol Data snd Mgmber Census
Data
The actuarial assumptions and methods, member census and financial data and Fund provisions,
unless specified otherwise, for purposes of our Study are the same actuarial assumptions and
methods, member census and financial data and Fund provisions outlined in the October 1,2014
Actuarial Valuation Report as modified above.
This Actuarial Study describes the financial effect ofthe proposed changes on the Fund, from a
neutral perspective. It is not intended as a recomlnendation in favor of nor in opposition to the
change.
This Actuarial Study provides the first year finanoialeffect of the proposed changes to the Fund.
A more complete understanding of the potential cost of these changes may be determined under
a projection actuarial study over a longer period (ex, thirty years).
The Unfunded Actuarial Accrued Liability shown may not be appropriate for assessing the
sufficiency of Fund assets to meet the estimated cost of settling benefit obligations but may be
appropriate for assessing the need for or the amount of future contributions.
These calculations are based upon assumptions regarding future events. However, the Fund's
long term costs will be determined by actual future events, which may differ rnaterially from the
assumptions made. These calculations are also based upon present and proposed Fund
provisions that are outlined or referenced in this Actuarial Study. If you have reason to believe
the assumptions used are unreasonable, the Fund provisions are incorrectly described or
referenced, important Fund provisions relevant to this proposed Actuarial Study are not
described or that conditions have changed since the calculations were made, you should contact
the undersigned prior to relying on information in this Actuarial Snrdy.
lf you have reason to believe that the information provided in this Actuarial Study is inaccurate,
or is in any way inoomplete, or if you need further information in order to make an informed
decision on the subject matter of this report, please contact the undersigned prior to making such
decision.
Gabriel Roedcr Smith & Compaoy
Page 1 157 of 2272
Mr. Jose del Rico
January 7,2016
Page Three
Future actuarial measurements may differ significantly from the cunent measurements presented
in this Actuarial Projection Study due to such factors as the following: Fund's experience
differing from that anticipated by the economic or demographic assumptions; changes in
economic or demographic assumptions; increases or decreases expected as part of the natural
operation of the methodology used for these measurements and changes in Fund provisions or
applicable law. Due to the limited scope of the actuary's assignment, the actuary did not perform
an analysis of the potential range of such future measurements.
This Actuarial Study should not be relied on for any purpose other than the purpose described in
the primary cornmunication. Determinations of the financial results associated with the benefits
described in this Projection Study in a manner other than the intended purpose may produce
si gnifi cantly di fferent results.
This report may be provided to parties other thart the City only in its entirety and only with the
permission of an approved representative of the City.
The signing actuaries are independent of the Fund Sponsor and are Members of the American
Academy of Actuaries and meet the Qualification Standards of the American Academy of
Actuaries to render the actuarial opinion contained herein.
If you should have any question conceming the above or if we may be of further assistance with
this matter, please do not hesitate to contact us.
Sincerest regards,
X3"-\tr", J
Lawrence F. Wilson, A.S,A,
Senior Consultant and Actuary
Enclosure
cc: Ms. Donna Brito
GEbriel Roeder Smith & Company
%% A Au.e
Kelly L. Adams, A.S.A,
Consultant and Actuary
Page 1 158 of 2272
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GRS Gabricl Roeder Srnith & Contpatty Onc Erst Broward Blvd. 954.'127,1616 phone
Cousrrlt,tnts Ec Actuaries Suitc 50.5 \ 954..52.5'0083 fax
Ft.Lautlertltlc,FL3330{'1804 wrvwgrtbriclroeder.conr
Jane7,2016
Mr. Jose del Risco
Assistant Director' Department of Human Servioes
City of Miami Beach
1700 Convention Center Drive
Miami Beach, Florida 33139
Re: City Pension tr'und for Firefighters and Police Officers in the City of Miami Beach
Proposed Collective Bargaining Agreements
Dear Jose:
As requested, we are pleased to enclose three (3) copies of an Actuarial Impact Statement as of
October 1,2015 for filing proposed changes due to the proposed collective bargaining
agreements under the City Pension Fund for Firefighters and Police Officers in the City of
Miami Beach (Fund) with the State of Florida.
Prooosed Chanses - We understand the proposed collective bargaining agreements will provide:
effective July 1, 2017 and3o/o effective July 1,2018.
or Captain a five percenl (5%) of base pay differential will be provided for Marine duties.
However the Marine pay differential cannot be combined with Special Operations pay
differential.
or Captain a flrve percefi (5%) ofbase pay differential will be provided for Special
Operations duties. However the Special Operations pay differential cannot be combined
with Marine pay differential.
or Captain, rescue out of class pay will increase from $2 to $3 per hour.
All sick leave hours used must be made up with straight time instead of time and one
half,
or Captain, six (6) additional hours of holiday pay are provided lor each holiday.
Page 1 160 of 2272
ATTACHMENT # 2
Mr. Jose del Risco
Jvne7,2016
Page2
Lieutenant or Sergeant, FTO pay is increased to five percent (5%) of base pay. This
cannot be combined with training unit pay,
Lieutenant or Sergeant, a five perceft(5%) of base pay differential will be provided for
training unit assignment. This cannot be combined with FTO pay.
or Captain, $500 paramedic bonus is changed from being paid biennially to annually,
or Captain, clothing allowance if increased from $50 to $85 monthly.
for Drug Recognition Experts and Arson Investigators and a 2.5%o of base pay differential
will be provided for Arson Investigator Trainees.
Results - Based upon the results of our Actuarial Impact Statement, the proposed Collective
Bargaining Agreements along with the Proposed Ordinance (see Actuarial Impact Statement
dated June 7 ,2016) decreases the first year annual City contribution by $1,117,986 (1.5% I
1.6%). ThefiguresinparenthesesaretheFundcostcxpressedasapercentageofprojected
covered annual payroll including DROP payroll (560,477,959) and projected covered annual
payroll excluding DROP payroll ($69,222,673), respectively as of October 1, 2015.
Filine Requirements - We have prepared the Actuarial Impact Statement for filing with the
State of Florida. Please note that this Statement must be signed and dated on behalf of the Board
of Trustees. Copies of the Ordinance upon passage at first reading along with the signed and
dated Actuarial Impact Statement are generally required to be filed with the State at the
following addresses:
Mr. Douglas E. Beckendorf, A,S.A. Ms, Sarah Carr
Bureau of Local Retirement Services Office of Municipal Police Officers'
Division of Retirement
Building 8
Post Office Box 9000
Tallahassee, Florida 323 15-9000
& Firefighters' Pension Fund
Building 8
Post Office Box 3010
Tallahassee, Florida 323 15-301 0
We understand the State requires funding no later than the fiscal year next following the
effective date of the increases in costs resulting from the Ordinance.
Actuarial Assumntions and Methods. Fund Provisions, Financiul Dsta, Member Census Data
The financial data utilized in the preparation of this Actuarial lmpaot Statement is the same
financial data utilized for the October 7,2075 Actuarial Valuation.
The Fund provisions employed for purposes of our Actuarial Impact Statement are the same
Fund provisions utilized for the Actuarial Impact Statement dated June 7 ,2016 for the Proposed
Gabriel Roeder Smith 6c Company
Page 1 161 of 2272
Mr. Jose del Risco
Jvne7,2076
Page 3
Ordinance changes. (See attached Outlinc of Principal Provisions of the Pension Fund section of
this Actuarial lmpact Statement for details,)
The actuarial assumptions and methods and member census data utilized in the preparation of
this Actuarial Impact Statement are the same actuarial assumptions and methods and member
census data utilized for the Actuarial Impact Statement dated June 7 ,2016 for Proposed
Ordinance changes modified as follows:
the City including estimated impact on pensionable pay. Adjustments were made to the
census datalo reflect these changes.
bargaining agreements. (See attached actuarial assumptions and methods section of this
Actuarial Impact Statement for details.)
This Actuarial Impact Statement is intended to describe the estimated frrture financial effects of
the proposed benefit changes on the Fund, and is not intended as a recommendation in favor of
the benefit changes or in opposition of the benefit changes,
If all actuarial assumptions are met and if all future minimum required contributions are paid,
Fund assets will bc sufficient to pay all Fund benefits. Fund minirnum required contributions are
deteflnined in compliance with the requirements of the Florida Protection of Public Employee
Retirement Benefits Act, Firefighters Retirement Chapter 175 and Police Officers Rctirement
Chapter 185with normal cost determined as a level percent of covered payroll and a level percent
amortization payment using an iriitial close d amortization period of 30 years,
The Unfunded Actuarial Accrued Liability (UAAL) may not be appropriate for assessing the
sufficiency of Fund assots to meet the estimated cost of settling benefit obligations but may be
appropriate for assessing the need for or the amount of future contributions, The UAAL Ratio
would be different if they reflected the market value of assets rather than the smoothed actuarial
value of assets.
These calculations are based upon assumptions regarding future events. However, the Fund's
long term costs willbe determined by actual future events, which may differ materially from the
assumptions made. These calculations are also based upon present and proposed Fund
provisions that are outlined or referenced in this Actuarial Impact Statement.
If you have reason to believe the assumptions used are uffeasonable, the Fund provisions are
inconectly described or referenced, important Fund provisions relevant to this Actuarial Impact
Statement are not described or that conditions have changed since the calculations were made,
you should contact the undersigned prior to relying on information in this Actuarial Impact
Statement.
If you have reason to believe that the information provided in this Actuarial Impact Statement is
inaccurate, or is in any way incomplete, or if you need further information in order to make an
Gabriel Roeder Smith 6c Company
Page 1 162 of 2272
Mr, Jose del Risco
J:une7,20L6
Page 4
informed decision on the subject rnatter of this report, please contact the undersigned prior to
making such decision.
Future actuarial measurements may differ significantly from the current measurements presented
in this report due to such fuctors as the following: Fund experience differing from that
anticipated by the economic or demographic assumptions; changes in economic or demographic
assumptions; increases or decreases expected as part of the natural operation of the methodology
used for these measurements (such as the end of an amortizationperiod); and changes in Fund
provisions or applicable law. Due to the limited scope of the actuary's assignment, the actaary
did not perform an analysis of the potential range of such future measurements.
This Actuarial Impact Statement should not be relied on for any purpose other than the purposo
described in the primary communication. Determinations of the financial results associated with
the benefits described in this report in a manner other than the intended purpose may produce
signifi cantly di fferent results.
This Actuarial Impact Statement has been prepared by actuaries who have substantial experience
valuing public employee retirement systems. To the best of our knowledge the information
contained in this report is accurate and fairly presents the actuarial position of the Fund as of thc
Actuarial Impact Statement date. All calculations have been made in conformity with generally
accepted aotuarial principles and practices, with the Actuarial Standards of Practice issued by the
Actuarial Standards Board and with applicable statutes.
This Actuarial Impact Statement may be provided to parties other than the City or Board only in
its entirety and only with the permission of an approved representative of the City or Board.
The signing actuaries are independent ofthe Fund sponsor.
The undersigned are Members of the American Academy of Actuaries and rneet the
Qualification Standards of the American Academy of Actuaries to render the actuarial opinion
contained herein.
If you should have any question concerning the above or if we may be of further assistance with
this matter, please do not hesitate to contact us.
Sincerest regards,
X 3 L.\ tr"^,%% A, A-t"e
Lawrence F, Wilson, A.S,A.
Senior Consultant and Actuary
Enclosures
KellyL. Adams, A.S.A.
Consultant and Actuary
Gabriel Roeder Smith Ec Company
Page 1 163 oI 2272
Ms. Donna Brito
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Actuarial Impact Statement as of October 1, 2015
A. Description of Proposed Changes Due to Collective Bargaining Agreements
Salary cost of living adjustments (COLA) will be lYo onApril 1, 201,6,3Yo on July 1,201,7 and.3o/o on
July 1,2018.
Effective October l, 2016 for Firefighter members with ranks of Firefighter, Lieutenant or Captain a five
percent (5%) of base pay differential will be provided for Marine duties. However the Marine pay
differential cannot be combined with Special Operations pay differential.
Effective October I, 2016 for Firefighter members with ranks of Firefighter, Lieutenani or Captain a five
percent (5%) of base pay differential will be provided for Special Operations duties. However the
Special Operations pay differential cannot be combined with Marine pay differential.
Effective October l, 2016 for Firefighter members with ranks of Firefighter, Lieutenant or Captain,
rescue out of class pay will increase from $2 to $3 per hour.
Effective June 1, 2016 FLSA minimum overtime provisions for sick leave usage only. All sick leave
hours used must be made up with straight time instead of time and one half.
Effective October 1,2015 for Firefighter members with ranks of Firefighter, Lieutenant or Captain, six
(6) additional hours of holiday pay arc provided for each holiday.
Effective June 1 ,2016 for Police Officer members with ranks of Police Officer, Lieutenant or Sergeant,
FTO pay is increased to five peroent (5%) of base pay. This cannot be combined with training unit pay.
Effective June 1, 2016 for Police Officer members with ranks of Police Officer, Lieutenant or Sergeant, a
five percent (5%) of base pay differential will be provided for training unit assignment. This carmot be
combined with FTO pay.
Effective October 1,20L5 for Firefighter members with ranks of Firefighter, Lieutenant or Captain, $500
paramedic bonus is changed from being paid biennially to annually,
Effective October l, 2015 for Firefighter members with ranks of Firefighter, Lieutenant or Captain,
clothing allowance if increased from $50 to $85 monthly.
Effective October 7, 2016 a five percent (5%) of base pay differential will be provided for Drug
Recognition Experts and Arson lnvestigators and a 2.5% of base pay differential will be provided for
Arson Investigator'frainees.
m*A1
Gabriel Roeder Smith 6c Company
Page 1 164 of 2272
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Actuarial Impact Statement as of October 1, 2015
B. An estimate of the cost of implementing these proposed changes due to collective bargaining.
C, In my opinion, the proposed changes are in compliance with Part VII, Chapter 112, Florida Statutes and
Section 14, Artiole X of the State Constitution.
Chairman, Retirement Committee
Date
Gabriel Roeder Smith & Company
Page 1 165 of 2272
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Actuarial Impact Statement as of October 1,2015
All Members
A. Participant Data
l. Active participants
2. Retired participants and beneficiaries
receiving benefits (including DROPs)
3. Disabled participants receiving benefits
4, Terminated vested participants
5. Annual Pensionable Payroll
6, Projected Annual Pensionable Payroll
7, Annual benefits payable to those currently
receiving benefits (including DROPs)
B. Assets
1. Smoothed aotuarial value
2. Market value
C. Liabilities
1. Actuarial present value of future expected benefit payments
for active members
a. Retiremont benefits
b. Vesting benefits
c, Death benefits
d, Disability benefits
e. Total
2, Actuarial present value of future expected benefit payments
for terminated vested members
3. Actuarial present value of future expected benefit payments
for ttrose cumently receiving benefits
a. Service retired (includes DROPs)
b. Benefioiaries
c. Disability retired
d. Total
4, Total actuarial pfesent value of future expected
benefit payments
5, Actuarial accrued liabilities (EAN)
6. Untunded actuarial accrued liability (EAN)
$ 407,61t,552 g 396,727 A54
4,193,372 4,193,372
Actuarial
Valuation
s08
668
56
20
$ 59,124,134
$ 61,075,230
$ 60,900,968
$ 759,327,614
$ 7s0,617,498
Proposed
Ordinance
508
668
56
20
$ 59,124,134
$ 61,075,230
$ 60,900,968
$ 759,32',7,614
$ 7s0,617,498
Bargaining
Agreement
508
668
s6
20
58,545,943
60,477,959
60,900,969
$ 759,327,614
$ 750,617,498
$ 347,402,867
73,378,921
5,632,243
29,570,950
$ 395,984,881
$ 4,183,372
$ 739,196,095
38,521,088
42,956,281
$ 820,6',73,464
$ 1,220,941,717
$ 1,050,154,648
$ 290.821.034
$
$
$ 359,044,505
13,336,011
5,631,679
29,599,417
$ 348,160,408
13,336,01 1
5,631,619
29,599,417
$ '740,928,052
38,521,089
42,9s6,28t
$ 822,405,421
$ 1,234,200,345
$1,058,484,242
$ 299,156,628
$ 739,196,095
38,521,098
42,956,291
$ 820,673,464
$ 1,221,594,290
sL,049,789,147
s 290,461,533
-1-
Gabriel Roeder Smith p Company
Page 1 166 ol 2272
AII Members
D. Statement of Accumulated Plan Benefits
1. Actuarial present value of accumulated vested benefits
a. Participants currently receiving benefits
(including DROPs)
b. Other participants
c. Total
2. Actuarial pfesent value of accumulated non-vested
plan benefits
3. Total actuarial present value of accumulated plan benefits
E. Pension Cost
1. Total normal cost
2. Payment required to amortize unfunded liability
3. Interest
4, Bxpected service buyback
5. Total required contributions
6. Item 5 as a petcentage ofprojected pensionable payroll
7. Estimated employee contributions
8. Item 7 as a percentage ofprojected pensionable payroll
9. Estimated State contributions
10, Item 9 as a percentage of projected pensionable payroll
1 1. Net amount payable by City
12. Item 1 I as a percentage ofprojected pensionable payroll
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Actuarial Impact Statement as of October 1, 2015
Actuarial
Valuaiion
$ 822,405,421
171,096,910
$ 993,492,331
9,437,794
$ 1,002,924,715
Proposed
Ordinance
g 820,673,464
170,L06,822
$ 990,780,286
5,657 ,726
$ 996,438,012
Bargaining
Agreement
$ 820,673,464
170,106,822
$ 990,780,286
5,65'7,726
$ 996,438,012
$ 18,581,095
27,205,832
224,475
762,591
$ 40,173,993
65.8%
$ 6,131,868
10.0%
$ 120,549
0.2%
$ 35,247,317
57.7%
$ 18,163,913
20,697,603
224,475
I62,5gl
$ 39,248,582
643%
$ 6,131,868
10.0%
$ 120,549
0.2%
$ 34,291,368
56.|o/n
17,937,596
20,718,967
222,287
161,001
39,033,851
64.5%
6,o72,ogg
10.0%
120,549
0.2%
34,129,331
56.4%
a
Gabriel Roeder Smith 8c Company
Page 1 167 of2272
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Actuarial Impact Statement as of October 1, 2015
All Members
Actuarial Proposed Bargaining
Valuation Ordinance Agreement
F. Disclosure of Following Items:
1. Actuarial present value of future salaries excluding
DROP payroll - attained age $ 590,869,479 $ 590,869,479 $ 588,001,202
2. Acttnrialpresent value of future employee
contributions - attained age S 59,437,078 $ 59,437,078 $ 59,151,994
3. Actuarial present value of future contributions
from other sources N/A N/A N/A
4. Amount of active members' accumulated
contributions $ 52,4),8,404 $52,418,404 $52,478,404
5. Actuarial present value of ftiture salaries and
future benefits at entry age N/A N/A N/A
6. Actuarial present value of fuhrre employee
contributions at entry age N/A N/A NIA
-3-
Gabriel Roeder Smith & Company
Page 1 168 of 2272
City Penslon Fund for Fircfighters flnd Police Officers
ln the City of Miami Beach
Actuarial Impact Statement as of October 1, 2015
G. Amortization of Unfunded Actuarial Accrued Liability
t0t0112001
1010t12002
l0/0112003
10t0112003
l0l0,/2004
t0/0u2005
1010U2005
t010U2005
t0/01t2006
t0lol12006
10t0U2007
10/01/2008
10/01/2008
1A10112009
1010112009
t0l0lt20t0
10tou20t0
1010U201
t0l0ll20t
tlt0U20t
l0lol/2012
t0lot/2012
tololl2012
t1t0U20t3
l0lot/2013
l0lot/2014
t0l0U20l4
1010U2015
10101/2015
10t01t20t6
1010112015
Enrollment Numb er : | 4-02802
Dated: June 7,2016
Unfunded Actuatial Accrued Liabilities.
Initial Unfunded Liability
Method Change
Fund Amendment
Actuarial (Gain) / Loss
Actuarial (Gain) / Loss
Method Change
Assumption Change
Actuarial (Gain) / Loss
Method Change
Actuarial (Gain) / Loss
Actuarial (Gain) / Loss
Assumption Change
Actuarial (Gain) / Loss
Assumption Change
Actuarial (Gain) / Loss
Assumption Change
Actuarial (Gain) / Loss
Fund Amendment
Assumption Change
Actuarial (Gain) / Loss
Assumption Change
Actuarial (Gain) / Loss
Plan Amendment
Actuarial (Gain) / Loss
Method Change
Actuarial (Gain) / Loss
Assumption Change
Actuarial (Gain) / Loss
Assumption Change
Proposed Ordinanoe
Bargaining Agreements
Unfunded Amortization
Liabilitv Pavment
$ 11,891,501 $ 1,009,954
13,52t,452 1,101,783
1,166,830 91,522
35,130,772 2,'755,541
37,698,503 2,854,733
(33,438,069) (2,450,998)
6,725,744 492,995
24,976,t18 1,830,740
(5,025,599) (357,414)
21,754,805 1,54'.1 ,17125,345,330 1,752,599
6,032,797 406,385
33,297,680 2,243,017
23,664,844 1,555,652
68,108,317 4,477,226
4,576,885 294,075
17,295,879 1,111,300
(3,101,976) (19s,091)
17 ,130,724 I,077 ,39530,472,366 1,916,485
7,806,919 481,247
26,284,914 1,620,298
(20,089,474) (1,238,388)
t,555,268 94,084
(64,520,385) (3,903,068)
(5,946,443) (3s3,40e)
5,748,022 341,617
8,645,019 505,302
2,447,885 l43,o7g
(8,695,095) (508,229)
365,501 21,364
x 3 A'u*",
Remaining
Funding
Period
1 6 yeats
17 years
I 8 years
I 8 years
I 9 years
20 years
20 years
20 years
21 years
21 years
22years
23 years
23 years
24 years
24yers
25 years
25 years
26 years
26 yoars
26 years
27 years
27 yous
27 yearc
28 years
28 years
29 years
29 years
30 years
30 years
30 yoars
30 years
TOTAL $ 290,827,034 $ 20,718,967
This aotuarial valuation and/or cost determination was prepared and completed by mo or under my direct
supervision, and I acknowledge responsibility for the results. To the best ofmy knowledge, thc results are complete
and accurate, and in my opinion, the techniques and assumptions used are reasonable and meet the requirements and
intent of Part VII, Chapter 1 12, Florida Statutes, There is no benefit or expense to be provided by the Plan and/or
paid from the Plan's assets fof whioh liabilities or curent costs havo not been established or otherwise taken into
account for in the valuation. Al1 known events or trends which may require a material increase in plan costs or
required contribution rates have been taken into account in the valuation.
Lawrence F, Wilson, A,S.A.
-4-
Gabdcl Roeder Smith Ec Company
Page 1 169 ol 2272
City Pension Fund for Firefighters and police Officers
in the City of Miami Beach
Outline of Principal Provisions of the Pension Fund
A, Relevant Provisions:
The Fund was created under Chapter 23414, Laws of Florida, Special Act of 1945, as amended by
Ordinance No. 2015-3970 adopted October 14,201,5,
B. Eligibilitlr Requirements:
Any full-time employee of the City who is certifled as a Firefighter or Police Officer as a
condition of employment,
C. Membership Tiers:
Tier 1 - Members hired prior to July 14,2010
Tier 2 - Mernbers hired on or after July 14, 2010 but prior to September 30,ZOl3
Tier 3 - Members hired on or after September 30, 2013 but prior to the date of ratification of
current collective bargaining agreement
Tier 4 - Members hired on or after the date of ratification of curent collective bargaining
agleement
D. Credited Service:
All periods of employment as an Employee for which contributions have been made to the Fund
together with all service in the uniformed services of the United States required to be included.
E. Pre-Emoloyment Service:
Effective Sepiember 30, 2013 members with at least 5 years of service may oontribute an
additional amount of 10.0% for those hired prior to September 30, 20i3 andl0.5% for those
hired on or after September 30,2013 to receive credit for pre-employment military service. A
member may purchase up to 2 total years of additional service credit at the 3% accrual rate for
time spent on active military duty. The total of all combinations of pre-employment benefit
purchased cannot exceed al2%o increase in accrual.
Pre-employment benefit service must be purchased within 36 months following September 30,
2413, ot upon completion of 5 years of creditable pension service under the pension fund,
whichever occurs later.
Effective September 30,2013, members will no longer be able to purchase an increase in benefit
multiplier or pre-employee public safety service credit as a Police Officer or Firefighter,
-5-
Gabriel Rosder Smith 8r Compauy
Page 1 170 of 2272
F"
City Pension Fund for Firelighters and police Officers
in the City of Miami Beach
Outline of Princinal Provisions of the pension Fund
Pensionable Pay:
Salary is defined as base pay, longevif pay, overtime, shift differential and extra compensation
allowance such as uniform allowance and any pays which are negotiated as pensionable. Effective
July 14, 2010, off-duty pay is pensionable for any member who is eligible for overtime and receives
off-duty compensation through the City. Effective Septembor 30,2073, overtime is limited to 300
hours a year.
l. Overtime and Off-Duty pay included in pension computation for Police Officers:
' Off-Duty and overtime pay not exceeding 300 hours per calendar year is limited in eaoh year
to an amount that is equal to 11% of highest annualized pay rate for the same salary rank that
the member is in at time of retirement.
' The ll% limitation shall not apply to any member who holds the rank of sergeant or
lieutenant on September 30, 20L3, or any Police Officer promoted to the rank of sergeant
prior to the date the 2013 Certifred Police Sergeant Promotional Register expired in 2015. For
these members, the inclusion of overtime and / or off duty in the mernber's salary shall be
limited iu each year to an amount which is equal to 70% of the difference between the
member's annualized pay rate at retirement and the highest annualized pay rate for the next
higher salary rank. For any of ihese members who self-demote their benefit will not exceed
eleven percent (l l%) of the highest annualized pay tate for the same salary rank the member
is in at the time of retirement; and overtime, off-duty or any other compensation will not be
applied to produce a benefit that exceeds the eleven percent (lL%) limitation.
2. overtime and off-Duty pay included in pension computation for Firefighters:
' off-Duty and overtime pay not exceeding 300 hours per calendar year is limited in each year
to an amount that is equal to 11% of highest annualized pay rate for the same salary rank that
the member is in at time of retirement.
Final Average Monthly Earnings (FAME):
Tier I and eligible to retire prior to September 30,2Ol5 - the greater of the average of the 2 highest
paid years prior to date of retirement or the 2 last paid years after taking into consideration the
overtime limit.
Tier 1 and eligible to retire on or after September 30, 2Ot5 - the greater of the average of the 3
highest paid years prior to date of retirement or the 3 last paid years after taking into consideration
the overtime limit.
Tier 2 - the greater of the average of the 3 highest paid years prior to date of retirement or the 3 last
paid years after taking into consideration the overtime limit.
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G.
City Pension I'und for Firefighters and Police Officers
in the City of Miami Beach
Outline of Princinal Provisions of the Pension Fund
Tier 3 - the greater of the average of the 5 highest paid years prior to date of retirement or the 5 last paid
years after taking into consideration the overtime limit.
Tier 4 - the average of the 5 highest paid years prior to date of retirement taking into consideration the
overtime limit.
H, Normal Retirement:
1. Eligibility:
Tier 1 and eligible to retire prior to September 30,2013 - the earlier of attainment of age 50 or Rule
of 70
Tier 1 and eligible to retire on or after September 30, 2013 - the earlier of attainment of age 50 or
Rule of 70 (must attain age 47)
Tier 2 and Tier 3 - the earlier of attainment of age 50 or Rule of 70 (must attain age 48)
Tier 4 - the earlier of attainment of age 52 or Rule of 70 (must attain age 48)
2. Benefit:
Tier I and eligible to retire prior to Scptember 30, 2013:
3% x FAME x Credited Service up to 15 years plus 4o/oxCredited Service after 15 years
Benefit shall not exceed 90% of FAME.
Tier 1 and eligible to retire on or after September 30,2013 but prior to September 30,2015:
3% x FAME x Credited Service up to 20 years plus 4o/o x Credited Service after 20 years
Benefit shall not exceed 85% of FAME (exception if exceeded 85% as of September 30, 201 3).
Tier I and eligible to retire on or after September 30, 2015, Tier 2, Tier 3 and Tier 4:
3% x FAME x Credited Service up to 20 years plus 4YoxCredited Seryice after 20 years
Benefit shall not exceed 85% of FAME. For Tier 4 benefit shall not exceed 85% of
pensionable Salary.
A member's benefit multiplier for credited service eamed before October 1., 2Al3 shall not be
reduced.
I. Deferred Retirement:
L Eligibility:
Any first day of the month past Normal Retirement Date.
2. Benefit:
Benefit calculated as for Normal Retirement based upon service and pay to Deferred Retirement Date.
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J.
Outline of Principal Provisions of the Pension Fund
Disabilitv Retirement:
l. Eligibility:
Totally and permanently disabled meaning incapacity to perform regular duty as Firefighter or
Police Officer (and completion of at least 5 years of Credited Service for non-service incured
2. Benefit:
Accrued benefit (minimum of 85% of current salary at time of disability for service incurred
disability).
Death Benefit:
l. Service Incurred:
Greater of accrued benefit or 85% of compensation payable as a monthly benefit to the widow
until death or remariage, to a Domestic Partner until death, marriage or enky into another
Domestic Partnership, to unmarried children in equal shares until age 18 (until age 22 if a full-
time student or until recovery from handicap if handicapped), or to dependent parents in equal
shares.
2, Non-Service Incurred:
For members with at least 5 years of service, accrued benefit is payable for the first 12 months
after death and 7 5Yo of the accrued benefit is payable thereafter (with a minimum benefit of 25%
of average monthly salary); Benefits are payable to the widow until death or remarriage, to a
Domestic Partner until death, marriage or entry into another Domestic Partnership, to unmarried
children in equal shares until age 18 (until age 22 if a full-time student or until recovery from
handicap or until marriage if handicapped), or to dependent parents in equal shares. However, if
the member has been married for less than 10 years, benefits are payable to the spouse only for
the life expectancy of the deceased member at time of death.
Withdrawal Benefit:
1. Eligibility:
Any age prior to 50 with at least 5 years of service for members who terminate employment on
or after September 30,2013.
2, Benefit:
Return of employee contributions or accrued benefit upon attainment of age 50. If a member
withdrawals with less than 10 years of service and passes away prior to the normal retirement
date the return of employee conhibutions is the only benefit.
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K.
L.
M.
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Outline of Princinal Provisions of the Retirement plan
Employee Contributions :
10.0% of salary per year (on a pre-tax basis) for members hired prior to September 30,2013 and 10.5%
of salary per year (on a pre-tax basis) for members hired on or after September 30, 2013; If
contributions are refunded to the member or to his beneficiaries, then interest is credited at the rato of 3%
per annum.
Normal Form of Payment of Retirement Income:
For members except those retiring prior to November 5,2003, the normal form of payrnent is a 75% jolnt
and survivor annuity with a specified beneficiary as provided under the plan. The specified beneficiary
will receive a survivor annuity equal to 100% of the total benefit for one year following the death of the
member and thereafter the greater of 75% of the total benefit or 25Yo of the average monthly salary for
the two highest paid years. However, upon death, if the member has been maried for less than l0 years,
the survivor annuity is payable only for the life expectancy of the deceased member at time of death.
The members may also eleot the actuarial equivalent of the 10 year certain and life annuity, with a
designated beneficiary, any of the following optional forms of payment:
, 75Yo joint and contingent survivor annuity with a designated beneficiary, 662A0/o joint and contingent annuity with a designated beneficiary. 50% joint and contingent annuity with a designated beneficiary. 250/o joint and contingent annuity with a designated beneficiary. 10 year certain and life annuity with a designated beneficiary
Members who retired prior to November 5,2003 were subject to different normal and optional forms of
payment,
Deferred Retirement OOtion Program (DROP):
Police Officers and Firefighters are eligible to participate in a Deferred Retirement Option Program
(DROP) upon meeting eligibilrty for a normal servics retirement.
Operations of the DROP:
' The member's monthly retirement benefit, based on final average earnings and service, will be
calculatecl as of the date prior to them entering the DROP.
' The member's monthly pension will be deposited into the selected investment vehicles.
' The member will cease to accrue additional pension benefits (with the exception of the COLA under
the pension plan).
' The member will no longer be eligible for Disability or Service Connected Death benefits from the
Pension Plan.
' Member contributions to the Pension Plan will cease upon entering the DRop.
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Gabriel RpESd lptln 8f .f*Zparry
City Pensiol Fund for Firefighters and Police Officers
in the City of Miami Beach
Outline of Princinal Provisions of the Pension Fund
Upon entering the DROP, the member will select the length of the DROP period. The maximum
period of participation in the DROP is 36 months for members who enter the DROP prior to
September 1,2012 and 60 months for members who.enter the DROP on or after September 1,2012.
Notwithstanding the above, participation may not continue beyond the date when the member's
cornbined years of creditable service and time in the DROP equals 352 months for members who
enter the DROP priot to September l, 2012 and 456 months for members who enter the DROP on or
after Septemb er 7, 2012.
Members who enter the DROP on or before September 30,2015 may extend their DROP
participation period by 12 months for a total maximum DROP participation period not to exceed
seventy-tlvo (72) months.
Members who enter the DROP on or after October 1,2075 but prior to ratification of the current
collective bargaining agreements may extend their DROP participation period by up to 36 months for a
total maximum DROP participation period not to exceed ninety-six (96) months.
Members who enter the DROP on or after ratification of the current collective bargaining agreements
may participate in DROP for a period not to exceed ninety-six (96) months.
Members who are participating in the DROP on the date of ratification of the current collective
bargaining agreements and elect to extend their DROP participation period must complete such forms
as are required by the Board not later than September 1,2016.
The member will not have access or be able to borrow against any of the funds accumulated in their
DROP account.
The member may sever employment with the City at any time during the DROP period. Such
separation will terminate their participation in the DROP.
No payment will be made from the DROP account until the member severs employment with the
City.
Following severance of employment, the funds in the DROP will be paid under the options the
member selected. The member will also start receiving their monthly pension which was previously
being deposited in the DROP.
A 25% COLA (l 5% pu year for participants hired on or after July 14, 2010) is paid annually on the
anniversary date of the member's retirement. For members who enter the DROP after September 1,
2012 and before September 30,2013 - no cost of living adjustment for the third and fourth annual
anniversary date, if the member participates in the DROP for six months or longer. Any member who
exits the DROP within 6 months following the date of DROP entry, shall be eligible for the 2,5Yo
COLA annually on the anniversary date of the member's retirement.
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P.
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Outline of Princinal Provisions of the Pension Fund
Members hired before the dato of ratification of the collective bargaining agreements who elect to
extend or enter the DROP and participate for more than 5 years will have no COLA adjustment
applied for years six (6), seven (7), and eight (8) while participating in the DROP. Mernbers hired on
or after the date of ratification of the current collective bargaining agreements will receive a zero
percent (0%) COLA for the first (lst), second (2nd), third (3rd) and fourth (4th) annual adjustrnent
dates while participating in the DROP.
Cost-of-Livins Adiustment:
Effective October 1,2010, benefits are increased by 25% per year (1.5% per year for participants hired
on or after July 14,2010), compounded annually, on the anniversary date of each member's retirement.
Members whose grandfathered Base Plan benefit is greater than the benefit otherwise provided by this
plan will receive the applicable cost-of-living adjustment on that basis (2% a yeff beginning the October
three years after retirement) until such time as the benefit from this plan with2.5Yo cost-ofJiving exceeds
that comparable grandfathered Base Plan benefit.
For members retired prior to October 1,2010, benefit increases occur on the first of October eaoh year.
Changes Since Previous Actuarial Valuation
Membership Tiers were:
Tier 1 - Mernbers hired prior to July 14,2010
Tier 2 - Mernbers hired on or after July 14,2010 but prior to September 30,2013
Tier 3 - Members hired on or after September 30, 2015
Pensionable Pay was:
Salary is defined as base pay, longevity pay, overtime, shift differential and extra compensation
allowance such as uniform allowance and any pays which are negotiated as pensionable, Effective July
14,2010, off-duty pay is pensionable for any member who is eligible for overtime and receives off-duty
compensation through the City. Effective September 30, 2013 , overtime is limited to 300 hours a year.
1. Overtime and Off-Duty pay included in pension computation for Police Officers:
' Off-Duty and overtime pay not exceeding 300 hours per calendar year is limited in each year to an
amount that is equal to llYo of highest annualized pay rate for the same salary rank that the
member is in at time of retirement.
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a.
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Outline of Principal Provisions of the Pension Fund
Q. Changes Since Previous Actuarial Valuation (continued)
' The ll%o limitation shall not apply to any member who holds the rank of sergeant or lieutenant on
September 30,2013, or any Police Officer promoted to the rank of sergeant prior to the date the
2013 Certified Police Sergeant Promotional Register expired in 2015. For these members, the
inclusion of overtime and / or off duty in the member's salary shall be limited in each year to an
amount which is equal to 70% of the difference between the member's annualized pay rute at
retirement and the highest annualized pay rate for the next higher salary rank.
2, Overtime and Off-Duty pay included in pension computation for Firefighters:
' Off-Duty and overtime pay not exceeding 300 hours per calendar year is limited in each year to an
amount that is equal to llo/o of highest annualized pay rate for the same salary rank that the
member is in at time of retirement.
Final Average Monthlv Earnines (FAME) were:
Tier I and eligible to retire prior to September 30,2015 - the greater of the average of the 2 highest paid
years prior to date of retirement or the 2 last paid years after taking into consideration the overtime limit.
Tier 1 and eligible to retire on or after September 30,2015 - the greater of the average of the 3 highest
paid years prior to date of retirement or the 3 last paid years after taking into consideration the overlime
limit.
Tier 2 - the greater of the average of the 3 highest paid years prior to date of retirement or the 3 last paid
years after taking into consideration the overtime limit.
Tier 3 - the greater of the average of the 5 highest paid years prior to date of retirement or the 5 last paid
years after taking into consideration the overtime limit.
Normal Retirement was:
l. Eligibility:
Tier 1 and eligible to retire prior to September 30,2013 - the earlier of attainment of age 50 or Rule
of70
Tier I aild eligible to retire on or after September 30,2013 - the earlier of attainment of age 50 or
Rule of 70 (must attain age 47)
Tier 2 and Tier 3 - the earlier of attainment of age 50 or Rule of 70 (must attain age 48)
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City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Outline of Princinal Provisions of the Pension Fund
Q, Chanses Since Previous Actuarial Valuation (.continued)
2. Benefit:
Tier I and eligible to retire prior to September 30,2013:
3% x FAME x Credited Service up to 15 years plus 4%o x Credited Service after 1 5 years
Benefit shall not exceed 90% of FAME.
Tier 1 and eligible to retire on or after September 30,2013 but prior to Septernber 30, 2015:
3% x FAME x Credited Service up to 20 years plus 4%o x Credited Service after 20 years
Benefit shall not exceed 85% of FAME (exception if exceeded 85% as of Septernber 30, 2013),
Tier 1 and eligible to retire on or after septernber 30,zol5,Tier 2 and Tier 3:
3% x FAME x Credited Service up to 20 years plus 4%o x Credited Service after 20 years
Benefit shall not exceed 85% of FAME.
A member's benefit multiplier for credited service earned before October l, 2Ol3 shall not be
reduoed.
Deferred Retirement Option Program (DROP) was:
Police Officers and Firefighters are eligible to participate in a Defened Retirement option Program
(DROP) upon meeting any one of the following criteria:
. the attainment of age 50 or
' the sum of the member's age and creditable seruice equal to at least 70 (minimum agemay apply)
Ooerations of the DROP were:
' The mernber's monthly retirement benefit, based on final average earnings and service, will be
calculated as of the date prior to them entering the DROp.
' The member's monthly pension will be deposited into the selected investment vehicles.
' The member will cease to accrue additional pension benefits (with the exception of the COLA under
the pension plan).
' The mernber will no longer be eligible for Disability or Service Connected Death benefits from the
Pension Plan.
' Member contributions to the Pension Plan will cease upon entering the DROP.
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City Pension Fund for Firelighters and Police Officers
in the City of Miami Beach
Outline of Princinal Provisions of the Pension Fund
Q, Changes Since Previous Actuarial Valuation (continued)
' Upon entering the DROP, the member will select the length of the DROP period. The maximum
period of participation in the DROP is 36 months for members who enter the DROP prior to
September 1,2012 and 60 months for members who enter the DROP on or after September 1,2012.
Notwithstanding the above, participation may not continue beyond the date when the member's
combined years of creditable service and time in the DROP equals 352 months for members who
enter the DROP prior to September 1,2012 and 408 months for members who enter the DROP on or
after Septemb er l, 2012.
' The member will not have access or be able to borrow against any of the funds accumulated in their
DROP account.
. The member may sever employment with the City at any time during the DROP period. Such
separation will terminate their participation in the DROP.
. No payment will be made from the DROP account until the member severs employment with the
City.
Following severance of employment, the funds in the DROP will be paid under the options the
member selected. The member will also start receiving their monthly pension which was previously
being deposited in the DROP.
A 25% COLA (1.5o/o per year for participants hired on or after July 14, 2010) is paid annually on the
anniversary date of the member's retirement, For members who enter the DROP after Septenrber 1,
2012 and before September 30,2013 - no cost of living adjustment for the third and fourth annual
anniversary date, if the member participates in the DROP for six months or longer. Any member who
exits the DROP within 6 months following the date of DROP entry, shall be eligible for the 2.5oh
COLA annually on the anniversary date of the member's retirement.
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B.
C.
D.
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Acfuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
A. Mortalitlr
For healthy participants, RP-2000 Combined Healthy Participant Mortality Tables, separate rates
for males and females, with Blue Collar Adjustment and projected 15 years from valuation date for
pre-retirement mortality and 7 years from valuation date for post-retirement rnortality with
projection Scale AA.
For disabled participants, RP-2000 Disabled Mortality Tables, sepamte rates for males and females,
without projection for future mortality improvement.
Investment Return
7,90oA, compounded annually, net of investment expenses.
Expenses
Prior year's acfual adminishative expenses.
Employee Withdrawal Rates
Representative values of the assumed annual rates of withdrawal among members in active service
are as follows:
Disabilit], Rates
Representative values of the assumed annual rates of disability among members in active service
are as follows:
35% of disabilities are assumed to be non-service incurred - 65% service incurred.
E.
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Gabriel opatg f 1$5trof I lp2nnanv
F.
City Pension Fund for Birefighters and Police Officers
in the City of Miami Beach
Actuarial Assumntions and Actuarial Cost Methods
Used in the Valuation
Salary Increase Factors
Representative values of the assumed annual rates of futuro salary increase are as follows:
ln addition to the average assumed salary increase rates shown above the expected cost of living
increases are as follows:
The cost of living increases shown above are based on a lo/o increase as of April I , 2016, 3 % increase
as of July I,2Ol7 and3Yo increase as of July 1,2018 contained in the collective bargaining agreements
and long term expected increases of 2.18% annually each July:
Payroll Growth Assumption
The aggregate compensation used to compute the accrued liability contribution rate is assumed to
increase at a tate of 3 5% per year - not greater than historical 10-year average (3 .3% as of October 1,
201s).
Loadinp for Contingencies
Pre-Employment Service: A City contribution of 0.275% of annual pensionable payroll is assumed
sufficient to provide for the purohase (or buyback) of pre-employment military service by the
Marital Assumptions
1. 77Yo of members are assumed married or entitled to benefits for dependents, including registered
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G.
H.
domestic partners.
J,
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Actuarial Assumptions and Actuarial Cost Method!
Used in the Valuation
2, Male spouses are assumed to be three years older than female spouses.
Retirement
A11 members are assumed to retire at age 50 with 26.25 years of service, but not later
Retirement is assumed to occur in acoordance with the following rates:
than age 65,
DROP Assumption
80% of all active participants will participate in the DROP.
This Actuarial Study applies the same retirement rate assumption as the October L,2074 Actuarial
Valuation Report. However the extension of the DROP may alter the retirement experience of the plan
causing a change in the retirement rates assumption in the future.
DROP assurnptions will need to be monitored in light of futurc DROP experience.
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K.
City Pension Fund for Firefighters and Police Officers
in the City of Miami Beach
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
L. Smoothed Asset Valuation Method
The method used for determining the smoothed actuarial value of assets phases in the deviation between
the expected and actual retum on assets at the rate of 20% per year. The smoothed actuarial value of
assets will be further adjusted to the extent necessary to fall within the corridor whose lower limit is 80%
of the fair market value of fund assets and whose upper limit is 120% of the fair market value of fund
assets.
M. Actuarial Cost Method
Normal Retirement. Termination. Disability. and Death Benefits: Ent{y-Age-Actuarial Cost Method.
Under this method the normal cost for each active employee is the amount which is calculated to be a
level percentage of pay that would be required annually from his age athire to his assumed retirement age
to fi:nd his estimated benefits, assuming the Fund had always been in effect. The normal cost for the
Fund is the sum of such amounts for all employees. The actuarial accrued liability as of any valuation
date for each active employee or inactive employee who is eligible to receive benefits under the Fund is
the excess of the actuarial present value of estimated future benefits over the actuarial present value of
current and future normal costs. The unfunded actuarial accrued liability as of any valuation date is the
excess of the actuarial accrued liability over the smoothed actuarial value of assets of the Fund.
N. Changes Since Previous Actuarial Valuation
Salary Increase Factors were:
Representative values of the assumed annual rates of future salary increase were as follows:
The average assumed salary inorease rates shown above were reduced by the expected cost of living
increase of 2.18% for FYE 2015 and then increased by a 3.00% cost of living increase in FYE 2016 and
as shown above thereafter.
DROP Assumotion was:.
80% of all active participants will participate in the DROP.
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Gabriel RBe$e tft$0tP8? ?7&npanv