Loading...
10-01-2009 Supplemental Actuarial Report - Interest Rate/Mortality Rate Change Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1616 phone GRS Consultants&Actuaries Suite 505 954.525.0083 fax Ft.Lauderdale,FL 33301-1827 www.gabrielroeder.com August 26,2010 Board of Trustees Village of North Palm Beach General Employees Retirement Fund c/o Jimmy Knight,Village Manager Village of North Palm Beach 501 U.S.Highway l North Palm Beach, Florida 33408 Re: Village of North Palm Beach General Employees Retirement Fund Interest Date 1 Mortality Rate Study as of October 1,2009 Dear Trustees: As requested,we have prepared the enclosed Supplemental Actuarial Valuation Report which presents a cost study of lowering the assumed rate of interest earned on fund assets and the assumed rate of mortality of members. The results presented reflect the adoption of Ordinance 2010-07. The impact of this Ordinance was originally shown in our June 7,2010 Actuarial Impact Statement. We have also enclosed 10 copies of the Asset Allocation Report we used to determine the expected rate of return going forward. In our view,the last page of that Report is the most important. The calculations are based upon assumptions regarding future events,which may or may not materialize. They are also based upon plan provisions that are outlined in the report. If you have reason to believe that the assumptions that were used are unreasonable,that the plan provisions are incorrectly described,that important plan provisions relevant to this proposal are not described,or that conditions have changed since the calculations were made,you should contact the author of this report prior to relying on information in the report. If you have reason to believe that the information provided in this report is inaccurate,or is in any way incomplete,or if you need further information in order to make an informed decision on the subject matter of this report,please contact the author of the report prior to making such decision. We welcome your questions and cornments. Sincerely yours, �c jam. J.Stephen Palmquist,ASA Duane Howison,FSA Senior Consultant and Actuary Consultant and Actuary JSPIrh Enclosures SUPPLEMENTAL ACTUARIAL VALUATION REPORT Plan Village of North Palm Beach General Employees Retirement Fund Valuation Date October 1,2009 Date of Report August 26,2010 Report Requested by Board of Trustees Prepared by J. Stephen Palmquist Group Valued All members Plan Provisions Being Considered for Change None Actuarial.Assumptions and Methods Being Considered for Change Present Assumptions Before Change Investment return: 8.00%per year, net after investment expenses Mortality: 1983 Group Annuity Mortality Tables for Males and Females Proposed Plan Change Investment return: 7.75%, 7.5%, 7.25%,and 7.00% per year, net after investment expenses Mortality: RP-2000 Generational Mortality Tables for Males and Females Participants Affected All Members Remaining Actuarial Assumptions and Methods Same as the Annual Actuarial Valuation as of October 1, 2009,except that the post-retirement assumed rate of return has been changed from 5.25%to 8.00°%. This change has been made because of the elimination of lump sum distributions under Ordinance 2010-07 and was included in our June 7,2010 Actuarial Impact Statement. Some of the key assumptions/methods are: Individual Salary increase: 5.50% per year Cost Method: Frozen Entry Age Actuarial Cost Method Amortization Period for Any Increase in Actuarial Accrued Liability 30 years Summary of Data Used in Report Same as October 1, 2009 Valuation, except that one additional member was added as being newly eligible under the new participation provisions of Ordinance 2010-07; see attached page. Actuarial Impact of Proposal(s) See attached pages Special Risks Involved With the Proposal That the Plan Has Not Been Exposed to Previously None Other Cost Considerations None Possible Conflicts With IRS Qualification Rules None As indicated below, the undersigned is a Member of the American Academy of Actuaries(MAAA) and meets the Qualification Standards of the American Academy of Actuaries to render the actuarial opinion herein. Steph n Palmquist,AS 4/, MAAA,FGA Duane Howison, FSA Enrolled Actuary No. 08-01564 Enrolled Actuary No. 08-06169 r4 tn Ile M o o °-° o ri o c oo a "D a C7 4� Q 06 x cli 60� C-, ON C4 rq 00 r4 C14 0 n� y _ _ x M N tiG n N 7� A 00 N 'y as G 0% d 00 xt 't `14 ^ Q 'E tA LV m lV yy D�0 ¢ DSO Q tai o N Ci krI 00 00 00 SAI ^ ^ ^ ti \ 00 ^ e° n \° ua 0 0 om n ca N c� en CJ rp J N ri B: e9+ °• 00 o i' [- 00 \° i° 00 \°kn o .�* Q ran vN'a 00 O N 00 p y n 00 00 '^ NO rn �. G M Tr In ON tn Q — ^ B Q C R = G eY CC 4,p d V C, 1- fl- 't 06 d Q e CL 0 � o < d 7 E u •2 U U c U. v c ; !© o 20 C S p 0 U O G U � U - Q j °Z U R r a 7 N U v azi a U a o a - U U U - y U U r� w C d Si3 d U d Q d O U ¢ d U U 0 ^ cv v. 71 N d N N W11 �c O +ri �c 'V' n^y 00 r•'7 4 Cr N eo N n co M � 00 Vc R N C3 C) �c ° C14 tn %D 00 °� y Cn 6o sA n �-- 4C NI o6 C M M ao T 00 � n: .O An C C C N C m V1 110 M 00 n n rn r no N et Cr .D eo N a r- r- 00 c= n �t u I rn � (sn M ao — r-, C- CV C14 00 W) 00 — O1 C7 C, a, 00 00 .^�' C) t tl M CR r• N C M C d' C cf n1 i 06 v'1 r11 � [� M fA N C3 R `C ST C7 N ati Vi C n -- EA N N 4 00 n 00 10 C C* v'1 Cl) r+1 M oo O -r ° n V1 en M N C? r- �t L N C3 %O 00 C^ fT O� 00 M 00 Cn M M h tS n M 00 00 n N n +o C• 06 +n C4 Cr — n C C n N Y1 +0 00 -- zp C R � r^R y d O� C M n Cr C C K3 M Try M 00 O M �? l"3 a eF C N C 00 �.9 r/1 'rL5 00 N C Ch n ° �t M In d' v 10 ei W) 00 00 00 C7 et W) n n N N wl N M o d o Rn N u 0 -:I, o -» to r+ M 00 00 00 0 N n M -- n M t N N C7 Cl %C p y a; tr cn 06 G^ — -r r ao r oo m U7 a, 00 V'l 0® m V3 00 kn 00 cc C ri 00 C7 c► r` r n tn C\ C7 OQ N V'i V7 n [! C 45 M LLI h mayh° 00 �- O N �c 00 C M trr c•1 00 N kn 4S fT O C, t+1 C] N D N CD ° Q 00 kn Y3 CV t- Ol a 00 00 m 00 n Nt '4 O N b' ffi C 'R wl — �t Ln N M In 4a N O M m r CS C; - 00 +r3 �o r= b4 N R W LL n 0 0 00 N n 0 M et m 00 N CI- �? v1 q�t 00 0, N N M N Cl M V1 ° a chi R 00 00 00 r- N C r_ rl- O M M 00 00 Cr 'm �7} C` �T C? r•3 !1j W — N C"4 Cn 00 DCl 06 0C] C t3 Ln � M - en N V'1 n C? N C? 'et ^e4' C, N fi C C V'] N 00 M N C] 0 M n Q C CT" a- 00 to 10 10 N E CC ![ (n to C C N N C M b" tip M 00 417 n ao 0 00 en �o N 06 N C7 w L7 as +l n Wt oq o n n v s o r 1 00 `r1 .6 -t 00 cV en 00 00 4r1 113 C7 C (14 vS n Cl� V1 C d O eMys n Q ti r1 4� M ♦p eF 'n � N I 69 V) ' .� 7.7 FL a. '�5.• ad .2 v _ _ c w y U � ? as .� U w ." �' is QC7 1 5 y c o CL L N Q k7 cd . s` m � u ' a is Cd t- Q o ca a. a a. 4J c Q 0. N M Q CL — N Q u Q LL LJ 07 C3 ci Czl Fs. cn '•' O to � b A M S �? � � .o 0000 10 n N O - 00 p C� Q to C 'It 00 Q st � LNL, e R N — e{ N M �" ` (.4 tn 00 00 A oo ray en 0s � � � t- m qz� 0 0c rh o \ � %C 4 oo ri cli MR CD C-4� W) O 00 7 M N fA H M ooDO M d' OD Q \ 1 C? M N ON. l N r•i vii G n t 4 4 C lz '= S Q M 'Ja N t'! 00 M N N f37 v n o�o o c`.o n Cpl r- � � Cl! R o ms M a oo �t o o zs o acs Ol 000 � Op ° © 00 rn \� R7 fA /r tom. I� 00 00 0% 00 ? ^ O OQO 00 0C rNO � t" 000 oo 00 00 N �oO MC^ ^ M &3 N J v QQ4 r Q+ r 'S1' 00 �r I d dam' rNR Wl CV n as OF Q .-. M M Q M M ti vh N — 00 — E rn N CD m © O ool R E7 VM'1 olO a, 00 r-R 00 tQ l� 06 Y] M Q OC t'�'YT r C3 Q en M oc ff1 o 13 - LLI a V y C a U o U + L Le Q cvd U C3 U *•C � C � � �: CJ @ C.�] C� W W Fes- [�i. PARTICIPANT DATA OCTOBER 1,2009 After Before Ordinance 2010-07 Ordinance 2010-07 ACTIVE MEMBERS Number 63 62 Covered Annual Payroll $ 3,046,421 $ 2,969,626 Average Annual Payroll $ 48,356 $ 47,897 Average Age 47.5 47.6 Average Past Service 11.6 11.8 Average Age at Dire 35.9 35.8 RETIREES& BENEFICIARIES& DROP Number 7 7 Annual Benefits $ 29,649 $ 29,649 Average Annual Benefit $ 4,236 $ 4,236 Average Age 73�0 73.0 DISABILITY RETIREES Number 0 0 Annual Benefits $ 0 S 0 Average Annual Benefit $ 0 S 0 Average Age 0.0 0.0 TERMINATED VESTED MEMBERS Number 50 50 Annual Benefits $ 300,474 $ 300,474 Average Annual Benefit $ 6,009 $ 6,009 Average Age 52.1 52.1