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PFPB Actuarial Report 10-01-2009VILLAGE OF NORTH PALM BEACH FIRE AND POLICE RETIREMENT FUND ACTUARIAL VALUATION REPORT AS OF OCTOBER 1, 2009 {As Revised Juiy 15, 2010) CONTRIBUTIONS APPLICABLE TO THE VILLAGE'S PLANIFISCAL YEAR ENDING SEPTEMBER 30, 2011 Foster&Foster~~. Actuarial Consultants far Retirement Programs July 15, 2010 Board of Trustees Village of North Palm Beach Fire and Police Retirement Fund c/o Ms. Denise McNeill The Resource Centers, LLC 4360 Northlake Blvd, Suite 206 Palm Beach Gardens, FL 33410 Re: Village of North Palm Beach Fire and Police Retirement Fund Dear Board: Vile are pleased to present to the Board this report of the annual actuarial valuation of the Village of North Palm Beach Fire and Police Retirement Fund. The valuation was performed to determine whether the assets and contributions are sufficient to provide the prescribed benefits and to develop the appropriate funding requirements for the applicable plan year. The valuation has been conducted in accordance with generally accepted actuarial principles and practices, including the applicable Actuarial Standards of Practice as issued by the Actuarial Standards Board, and refilects laws- and regulations issued to date pursuant to the provisions of Chapters 112, and 175 and 185, Florida Statutes, as well as applicable federal laws and regulations. In our opinion, the assumptions used in this valuation, as adopted by the Board of Trustees, represent reasonable expectations of anticipated plan experience. In conducting the valuation, we have relied on personnel, plan design, and asset information supplied by the Board of Trustees, financial reports prepared by the custodian bank, Salem Trust, and the actuarial assumptions and methods described in the Actuarial Assumptions section of this report. While we cannot verify the accuracy of ail this information, the supplied information was reviewed for consistency and reasonableness- As a result of this review, we have no reason to doubt the substantial accuracy of the information and believe that it has produced appropriate results. This information, along with any adjustments or modifications, is summarized in various sections of this report. The undersigned is familiar with the immediate and long-term aspects of pension valuations, and mee#s the Qualification Standards of the American Academy of Actuaries necessary to render the actuarial opinions contained herein. All of the sections of this report are considered an integral part of the actuarial opinions. 13420 Parker Commons Blvd., Suite i04 • Fort Myers, Florida 33912.239-433-5500 • Fax 239-481-0634 • www.foster-foster.com Board of Trustees July 15, 2010 Page Two To our knowledge, no associate of Faster & Foster, Inc. working on valuations of the program has any direct financial interest or indirect material interest in the Village of North Palm Beach, nor does anyone at Faster & Foster, inc. act as a member of the Board of Trustees of the Village of North Palm Beach Fire and Police Retirement Fund. Thus, there is no relationship existing that might affect our capacity to prepare and certify this actuarial report. If there are any questions, concerns, or comments about any of the items contained in this report, please contact me at 239-433-5504. Respectfully submitted, Foster & Foster, Inc. 'i ~~ f By: Bradley R. Heinrichs, FSA, EA, MAAA Enrolled Actuary #48-6901 BRHlmjg Enclosures TABLE OF CONTENTS Section Title Page I Introduction a. Summary of Repart 1 b. Changes Since Prior Report 3 c. Requirements of Chapter 112, ~ Part VII, Florida Statutes II Valuation Information a. Actuarial Assumptions and 9 Funding Methods b. Valuation Notes 11 c. Partial History of Premium 12 Tax Refunds d. Excess State Monies Reserve ~ 13 III Trust Fund 14 lV Member Statistics a. Eligibility for Retirement 18 b. Statistical Data 19 c. Age and Service Distribution 20 d. Member Reconciliation 21 V Summary of Plan Provisions 22 VI Governmental Accounting Standards 25 Board Disclosure Information SECTION I INTRODUCTION SUMMARY OF REPORT The regular annual actuarial valuation of the Village of North Palm Beach Fire and Police Retirement Fund, performed as of October 1, 2009, has been completed, and the results are presented in this Report. The cantribu#ion amounts developed in this valuation are applicable to the planlfiscal year ended September 30, 2011. The contribution requirements, compared with amounts developed in the October 1, 2008, actuarial ~aiuation prepared by Foster & Foster (as revised .tune 3, 2010), are as folloWS: Valuation Date 10/1/2008 1011/2009 ~ Applicable PIanlFiscal Yr. End 9/30/2010 9/30/2011 l Total Required Contribution i % of Total Annual Payroll 25.73°10 26.21 Member Contributions ,~ % of Total Annual Payroll 2.00% 2.00% Village and State Required Contribution of Total Annual Payroll 23.73% 24.21 State Contribution (1) 221, 372 221,372 --t % of Total Annual Payroll 6.58% 6.35% Balance from Village (1) of Total Annual Payroll 17.15% 17.86% {1) State Contribution shown is the amount received during the year ending December 31, 2009. The Village may use up to $230,696 in State Contributions for determining its minimum funding requirements. Far budgeting purposes, the required Sponsor Contribution (Village and State) is 24.21% of Pensionable Earnings for the fiscal year ending September 30, 2011. The precise Village requirement is the applicable Sponsor percentage, less actual State Contributions (up to the maximum $230,696). Additionally, the Village has a prepaid contribution of $111,329 that may be utilized for the fiscal year ending September 30, 2010. 2 As can be seen, the Total Required Contribution has increased when expressed as a percen#age of Total Annual Payroll. This increase is a result of net unfavorable actuarial experience during the past year. The primary component of unfavorable experience is attributable to a 6.3°/a investment return (Actuarial Asset basis), failing short of the 8.0% assumption. This loss was partially offset by average increases in Pensionable Compensation that were less than the assumption by more than 2%, greater than expected employee turnover, and a decrease in the average entry age of Plan participants. The balance of this Report presents additional details of the actuarial valuation and the general operation of the Fund. The undersigned would be pleased to meet with the Board to discuss the Report and answer any questions concerning its contents. i Respectfully submitted, FOSTER & FOSTER, INC. L ~~ By; By: Bradley R. Heinrichs, FSA, EA ~-~y~-- Douglas H. Lozen 3 Plan .Chan es .Since .P.riar Valuation There have been no changes in benefits since the prior valuation. Actuarial Assum tionlMethod Chan es Since Prior Valuation There were no changes made to the actuarial assumptions or methods since the prior valuation. 4 Comparative Summary of Principal Valuation Results 10/1/2009 10/1/2008 A. Participant Data Number included Actives a2 50 Service Retirees 6 4 Beneficiaries D 0 Terminated Vested 11 12 Disability Retirees 1 1 Tota! 70 67 Total Annual Payroll 3,488,338 3,364,295 Payroll Under Assumed Ret. Age 3,488,338 3,364,295 Annual Rate of Payments to: Service Retirees 126,123 81,218 Beneficiaries 0 D Terminated Ves#ed 206,873 219,198 Disability Retirees 38,585 38,585 B. Assets Actuarial Value 1 D,65D,648 1 D,D45,838 Market Value 9,979,357 1 D,D45,838 C. Liabilities Present Value of Benefits Active Members Retirement Benefits 9,830,139 9,736,103 Disability Benefits 990,229 933,306 Death Benefits 164,877 150,694 Vested Benefits 630,864 582,271 Refund of Contributions 43,952 37,524 Sen-ice Retirees 3,409,487 2,420,686 Beneficiaries 0 0 Terminated Vested 2,147,79D 2,128,414 Disability Retirees 557,901 ~ 567,717 Excess State Monies Reserve 0 0 Total 16,556,715 17,775,239 5 10/1/2009 1011 I2aos C. Liabilities - {Continued) Present Value of Future Salaries Present Value of Future Normal Costs (Aggregate Basis) Present Value of Future Normal Costs (Entry Age Basis) Normal Cast (Aggregate, Level Percent) Present Value of Future Member Contributions 30,485,079 28,895,259 7,124,591 8,510,877 5,118,946 4,952,283 815,251 758,066 609,702 577,905 Actuarial Accrued Liability (Aggregate Basis) Actuarial Accrued Liability {Entry Age Basis) Unfunded Actuarial Accrued Liability (UAAL} D. Actuarial Present Value of Accrued Benefits Vested Accrued Benefits Inactives Actives Member Contributions Total Non-jested Accrued Benefits Total Present Value Accrued Benefits Increase (Decrease) in Present Value of Accrued Benefi#s Atkributable to: Plan Amendments Assumption Changes New Accrued Benefits Benefits Paid Interest Other 10,650,648 10,045,838 12,656,293 11,604,432 0 0 6,115,178 3,577,156 320,579 10,012,913 970,715 10,983,628 0 0 905,866 (855, 081 } 778,171 p 5,115,817 3,812,561 2$3,429 9,212,807 941,$65 10,154,672 Total: 828,956 Valuation Date Applicable to the Fiscal Year Ending E. Pension Cost Normal Cost (with interest) of Total Annual PayroA* Administrative Expense (with interest) °10 of Total Annual Payroll' Payment Required to Arr~ortize Unfunded Actuarial Accrued Liability aver 0 years (as of 1411109) of Total Annual Payroll* Total Required Contribution of Total Annual Payroll* Expected Member Contributions of Total Annual Payrolh' Expected Village & State Contrib. of Total Annual Payroll* F. Past Contributions Plart Years Ending: Total Required Contribution Village and State Requirement Actual Contributions Made: Members Village State Total G. Actuarial Gain (Loss} NIA 1 olv2oo9 ~ ~ o1112aoa 9/30/2011 9/30/2010 24.31 23.43 1,g0 2.30 0.00 0.00 26.21 25.73 2.00 2.00 24.21 23.73 9/30/2009 796,929 728,729 ss,2ao 507,357 221,372 7 6,9 9 ~` Contributions developed as of 10!1109 are expressed as a percentage of projected annual payroll at 1011109 of $3,488,338 7 H. Schedule Illustrating the Amortization of the Total Unfunded Actuarial Accrued Liability as of: Projected Unfunded Year Accrued Liabili NIA -Aggregate Actuarial Cost Method (i} 3 Year Comparison of Actual and Assumed increases in Pensionable Compensation Actual Assumed Year Ended 9/30/2009 3.5% 6.0% Year Ended 9/30/2008 4.7% 6.0% Year Ended 9/30/2007 9.8% 6.0% {ii) 3 Year Comparison of Investment Return on Actuarial Value Actual Assumed Year Ended 9/30/2009 6.3% 8.0% Year Ended 9/30/2008 0.7% 8.0% Year Ended 9/30/2007 9.1 % 8.0% (iii) Average Annual Payroll Growth {a} Payroll as o#: 1011/2009 $3,488,338 1011 /1999 1,355,684 {b} Total Increase 157.3% (c} Number of Years 10.00 (d) Average Annual Rate 9.9% r 8 Statement by Enrolled Actuary This actuarial valuation was prepared and completed by me or under my direct supervision, and I acknowledge responsibility for the results. To the best of my knowledge, the results are comple#e and accurate, and in my opinion, the techniques and assumptions used are reasonable and meet the requirements and intent of Part VII, Chapter 112, Florida Statutes. There is no benefit or expense to be provided by the plan andlor paid from the plan's assets #or which 4iabilities or curren# costs have not been established or otherwise taken into account in the valuation. All 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. ~• Bradley R. Heinrichs, FSA, EA, MAAA Enrolled Actuary #08-6901 A copy of this Report is to be furnished to the Division of Retirement within 60 days of receipt from the actuary at the following address: Patricia Shoemaker Municipal Police and Fire Pension Trust Funds Division of Re#irement Post OfFice Box 3010 Tallahassee, FL 32315-3010 Mr. Keith Brinkman Division of Retirement Bureau of Local Retirement Systems P. O. Box 9000 Tallahassee, FL 32315-9000 sECTION II VALUATION INFORMATION 9 ACTUARIAL ASSUMPTIONS AND FUNDING METHODS Mortality Rate Interest Rate Retirement Rates 5 Disability Rate i Termination Rate i Sala Increases Post Retirement COLA Pa roll Growth Administrative Ex enses Assumptions 1983 Group Annuity Mortality Table. Disabled members set forward 5 years. S% per year compounded annually, net of investment related expenses. The assumed rate of retirement is 5.0% for each year of eligibility for early retirement. Below are the rates assumed once the member has attained normal retirement eligibility. Number of Years After First Eligibility For Normal Retirement 0 1 2 3 4 5+ Annual Rate of Retirement 60% 4d°/° 40% 40% 4Q% 100% See table on the following page. 75% of disabilities are assumed to be service-incurred. See table on the following page. 6.0% per year until the assumed retirement age. 3% per year. NIA. Average of actual administrative expenses over the previous two years. 10 ACTUARIAL ASSUMPTIONS AND FUNDING METHODS (continued) Becoming Disabled % Terminating Durin the Year Durin the Year 20 0.14% 9.00% 25 , 0.15% 8.55% 3Q 4.18% 7.50% 35 0.23% 5.70% 40 ~ 0.30% 3.90% 45 0.51 % 2.40% 50 1.OD% 1.20% 55 1.55% 0.45% sD a.oo°i° o.so% Funding Method Aggregate Actuarial Cost Method 11 VALUATION NOTES Total Annual Pa roll is the projected annual rate of pay for the fiscal year preceding the valuation date of all covered members. Present Value of Benefits is the single sum value on the valuation date of all future benefits to be paid to current Members, Retirees, Beneficiaries, Disability Retirees I ~ I arld Vested Terminations. Normal Current Year`s Cost Rate is determined in the aggregate as the ratio of (a} and {b) as follows: (a} The present value of benefits for all Plan participants, less the actuarial value of assets. (b) The present value of future compensation over the anticipated number of years of participation, determined as of the valuation date. The Normal Cost dollar requirement is the ratio of (a) and (b), multiplied by the Total Annual Payroll as of the valuation date. i ~ A re ate Ac#uarial Cast Method (Lave! Percent of Compensation} is the method used to determine required contributions under the Plan. The use of this method involves the systematic funding of the Normal Cost (described above). Total Required Gontribution is equal to the Normal Cost plus an adjustment for interest according to the timing of sponsor contributions during the year. 12 PARTIAL HISTQRY ~1= PREMIUM TAX REFUNDS Received During Increase from Fiscal Year Amount Precious Year 1989 52,$66.00 1990 49,647,00 -6.1 1991 54,960.00 10.7% 1992 51,832.00 -5.7% 1993 49,897.00 -3.7% 1994 54,214.00 8.7% 1995 58,926.00 8.7% 1996 55,501.00 -5.8% 1997 76,514.00 37.9% 1998 92,462.12 20.8% 1999 80,911.74 -12.5% 2000 78,246.11 -3.3% 2001 10$,200.87 3$.3% 2002 134,40$.43 24.2% 2003 159,943.14 19.0% 2004 203,317.14 27.1 2005 209,222.36 2.9% 2006 233,640.77 11.7% 2007 325, 961.92 39.5% 2008 321,142.12 -1.5% 2009 221,372.40 -31.1 13 O O O O N O CO ~'1 N f~ 00 O O O O C? d ~i7 M T O ~ 03 O] O OD N p 2 O O O O a? eO~ N ONO d01 ~l ~ OOd' t ~ ~ ~ ~ N N C4 oa (~ M 1~ O M ~ LIJ N ~ N ~ ~ d0' O~i rn Q-' M O 7 j ~ Q1 = ~ CNYS ~j ~ (~ ~ ~ t~ ~ 1t~3 ~ M1 N .~ G C CA O N d' O uO 0 OS Q1 Cn O] N Q (~ N p I~ N +- N M W ti ti h n ti ~ , p u7 c0 ch o0 O cD is7 ~ ~ to u~ ~ a ~ ~ 1~ r M ~fl CD O i~ 1~ I~ ti ~ Y i , lL. Q 11. Q K3 Lf! M N r M c N ~ 01 0) U U3 a° ~ ~ h 03 N Ll.. Q) (~) W N ~ m N U ~ X ~ W O 0 m ca 5 ~ 00 O O 47 O O d1 d r N N p ~ r' CA O r CD 1` ~ ~D N ll7 d +=' 1 p d7 ~ M N O ~fl OO r LC1 r O d1 ~ a N -p ~ l!) O d O I~ CO O ~- T M M O ~ cO N ti O r M M ~ T I~ U L ~ ~ ~ N _ M ~ 0 O Q O • ' N N d ' t f? O O N U 0 3 .a a N O O O O O O CD 0 M M N O M O M O M M O r O O O O O d a0 r LfY T O O f~ O [~ 00 ~ LL7 O c° ~ ~~ Z o d o 0 0 o ti Oo c v sr o co r a~ o ri rn o ci ai rn er c+s ri ~ d' o a ', cfl ~~ Of N ~ O O O 1~ I~ M •-- T O W ~ N N ~ 0 O N N~ N N ~ i O D ( O ++ ~ Oo o ao ~ to cQ ~n r~ ti o o N 01 ., i.() OD L[] T ~ ti M r r CQ 00 CO ~ ~ C~ O CD 07 N ib r N d' M r M 1` 00 Q3 (d N 7 DD 00 00 O ti Y- O Lt7 O N M CA r i ~] N p U7 N ~fi 4 O7 N CA CA W Cp r M ~ U Q ~ ~ Q LL CV N ~ N N N C] mot' 00 ~ to CO N d' LL7 ~t7 00 ~}' ['rl M O ~# aQ O p N N N O = N N N ~ V N N [t)1 ~ ~ ~ O O O d' OS O r N O M N N N W~ ~ p 0 p ~['} 00 [O r d' !~ N M f~ f~ a0 CD ~ f`ll ~ C ~ O ~ ~ ~ ~ 000 000 ~ ON6 ~ r OOO 4~] ~ ~ to N ~ X ~" ~- f"-SS ~ W C Ql ~ ~ N N O CA N N N CO N M ~ (fl ~ ~ ~ ~ ~ fA {-' N N ~ N N N O ~t 04 ~ [!i CO N [~ ui oa V' O) r7 rn ao O ~ ~ 'U ` t] (d ~ o N U C ~ U ~ r m ~ o a~ ao-~ ~~ Ck. EY (A H y ~ 7 ~. - O Lf1. 0 o 0 o 0 a 0 o o d a a o o 0 0 0 o o d n a a o o 0 ~ o ~_ ~ w m~ o 0 0 0 0 0 o Q o 0 o a 4 ~ o N ~ y ~ ~ U r N ~ ~ ~ ~ = N ~ ~ D o d o a o M ~ ~ oo ao m QI O O O O O O N ~ ~ Qi 1~ ail = ~ C C M M M C7 M M m [0 r m~p N ~ 0 0 Ob ~ U O N N N N N N i 0 i~ a1 ~ N ~ C1. ~~ LL ¢ ~' _ N co N d CV [O N cp N CD C11 cD [~ a0 _ ~ f~ r oo (p a7 O 67 r 4 r GS U C p O d tp [+ r C4 M I~ CA r~ N i~ M N ~!] et r ~ OD rn Op [~ (O ~ +_~ (U GS 7 ri ai r r- [+ c~ LL~ r 00 ~ti 0 ao N cfl (D ti T ao QJ cD 06 ui ~ i ~ :~ N (D N O N M (O (D 1± O? ~ N _ Q ~ d ~ V ~ ' ~ ~ OI'J 0~0 ~ d ~ ~ O ~ L} OO 0 O ~ N M ~ 4f) (O N Dd O W 0 O O O 4 O O O O O p~ O d O O O O O O d O O r r- N N N N N N N N N N SECTION III TRUST FUND Village of North Palm Beach Fire and Police Retirement Fund BALANCE SHEET September 30, 2009 14 ASSETS COST VALUE MARKET VALUE Cash and Cash Equivalents: Checking Account 286,293.25 286,293.25 Prepaid Expenses Money Market 1,498.13 465,050.03 1,498.13 465,050.03 Pending Trades Receivable 1,006,822.11 1,006,822.11 Total Cash and Equivalents 1,759,663.52 1,759,663.52 Receivable: State Contributions 221,372.40 221,372.40 Accrued Income 47,874.77 47,874.77 Total Receivable 269,247.17 269,247.17 Investments: U S Govt & Agencies 1,567,735.26 1,583,462.53 Corporate Bonds ~ 1,764,112.41 1,875,158.95 Common Stocks 4,685,068.21 4,294,438.69 Municipal Obligations 274,933.25 297,406.05 Mutual Funds: Equity 14,091.00 21,400.50 Total Investments 8,305,940.13 8,071,866.72 TOTAL ASSETS 10,334,850.82 10,100,777.41 LIABILITIES AND NET ASSETS Liabilities: Payable: Unpaid investment Expenses 4,298.80 4,298.80 Unpaid Administrative Expenses 5,792.43 5,792.43 Prepaid City Contribution 111,329.00 111,329.00 Total Liabilities 121,420.23 121,420.23 Net Assets: Active and Retired Members' Equity 10,213,430.59 9,979,357.18 Total Net Assets 10,213,430.59 9,979,357.'18 TOTAL LIABILITIES AND NET ASSETS 10,334,850.82 10,100,777.41 Village of North Paim Beach Fire and Police Retirement Fund CHANGES IN NET ASSETS AVAI~AB~E FQR BENEFITS September 30, 2009 Market Value Basis INCOME Contributions: Member Buy-Back City State Total Contributions Earnings from Investments Interest & Dividends Miscellaneous Income Net Realized Gain (Loss} Unrealized Gain (Loss) Total Earnings and lnvestmen# Gains EXPENSES Administrative Expenses: Investment Related* Other Total Expenses Distributions to Members: Benet'It Payments Lump Sum Retiree Distributions Return of Contributions Total Distributions Change in Net Assets for the Year Net Assets Beginning of the Year Net Assets End of the Year *Investment Related expenses include investment advisory, custodial and performance monitoring fees. 55,238.21 2,961.90 599,505.97 221,372.40 294,070.88 5,958.59 (191,007.69} (86,402.02) 59,260.99 63,837.26 126,144.33 722, 595,44 6,341.13 15 889,078.4$ 22,619.76 123,098.25 855,0$0.90 (66,480.91 } 10,045,$38.09 9,979,357.18 16 Village of North Palm Beach Fire and Police Retirement Fund ACTUARIAL ASSET VALUATION September 30, 2009 Actuarial Assets for funding purposes are developed by recognizing the total actuarial investment gain or lass for each Plan Year over a five year period. In the first year, 20% of the gain or loss is recognized. In the second year 40%, in the third year 60%, in the fourkh year 80%, and in the fifth year 100% of the gain ar loss is recognized. The actuarial inves#ment gain or loss is defned as the actual return an investments minus the actuarial assumed investment return. GainslLosses Not Yet Recognized Plan Year Amounts Nnt Yet Recognized by Valuation Year Ending GainlLass 2x09 2010 2011 2012 2013 9/3012005 0 0 0 0 0 0 9/30/2006 0 0 fl 0 fl 0 9/30/2007 0 0 0 0 0 0 913or2flos 0 fl a o a fl 9/30/2009 (839,114) (671,291} (503,469} (335,646} (167,823) 0 Total {671,291) {503,469} (335,646) {167,823) 0 Develo ment of Investment GainlLoss Market Value of Assets, 9/30/2008 10,445,838 Contributions Less Benefik Payments & Admin Expenses {29,840) Expected Investment Earnings on Actuarial Value 802,473 Actual Net Investment Earnings {36,641) 2009 Actuarial Investment Gainl(Loss} {839,114) "Expected Investment Earnings = 0.08 i Develo Market Value of Assets, 9/30/2009 (Gains)ILosses Not Yet Recognized Actuarial Value of Assets, 9130/2009 {A) 9/3012008 Actuarial Assets: (I} Net Investment Income: 1. Interest and Dividends 2. Realized Gains {Losses} 3. Change in Actuarial Value 4. Investment Expenses Total (10,045,838 ~ .5 * -29,840) ~ment of Actuarial Value of Assets 9,979,357 671,291_ 10,650,648 1 fl', 045, 838 300,029 (191,008) 584,889 59,261) 634,650 (B) 913fl120fl9 Actuarial Assets: 10,650,648 Actuarial Asset Rate of Return = 211(A+g-I}: 6.3% 10!01109 Limited Actuarial Assets: 10,650,648 {Lesser of Actuarial Assets or 12fl% of Market Value) Village of Norkh Palm Beach Fire and Police Retirement Fund CH,~NGES IN NET ASSETS /IVf1ILABLE FOR BENEFITS September 30, 2009 Actuarial Asset Basis INCOME Contributions: Member Buy-Back City State Total Contributions Earnings from Investments interest & Dividends Miscellaneous Income Net Realized Gain (Loss) Change in Actuarial Value Total Earnings and investment Gains EXPENSES Administrative Expenses: investment Related* Other Total Administrative Expenses Distributions to Members: Bene#it Payments Lump Sum Retiree Distributions Return of Contributions Total Distributions Change in Net Assets for the Year Net Assets Beginning of the Year Net Assets End of the Year~* `Investment Related expenses include investment advisory, custodial and performance monitoring fees. **Net Assets may be limited for actuarial consideration 65,238.21 2,961.90 599,505.97 221, 372.40 294,070.88 5,958.59 (191,007.69) 584,888.98 59,260.99 63, 837.26 12fi,144.33 722,595.44 6,341.13 17 889,078.48 693,910.76 ~ 23,a98.25 855,0$0.90 604,810.09 10,045,838.09 10,650,648.18 SECTION IV MEMBER STATISTICS 1~ ELiGIBILTY FOR RETIREMENT Members are eligible for Normal Re#irement based upon the following criteria: 1) Attained Age 55 2) Attained Age 52 with 25 Years of Credited Service Members are eligible for Early Retirement based upon the following criteria: 1) Attained Age 50 As of the date of this valuation, the following list of Members are eligible for: Normal Retirement DIKINSON GARY, KENNEDY WILLIAM, MAKI HENRY, MILDWORM KENNETH, SMITH WILLIAM J. SR, Early Retirement ARMSTRONG JOHN, MATTING, SALVATORE, VAN DEUSEN SCOTT, YUNGK JOSEPH, 19 STATISTICAL DATA 1011 !2007 10/1/2008 10/7/2009 Number 46 60 62 Average Current Age 39.9 39.4 39.0 Average Age at Employment 30.9 32.4 32.1 Average Past Service 9.0 7.0 6.9 Average Annual Salary $67,610 $67,286 $67,0$3 20 AGE AND SERVICE DISTRIBUTION PAST SERVICE AGE 0 '! 2 3 4 5-9 10-14 15-19 20-24 25-29 30+ Total 15-19 0 0 0 0 0 0 0 0 0 0 0 0 20-24 3 0 0 0 0 0 0 0 0 0 0 3 25 - 29 1 3 0 3 2 1 0 0 0 0 0 10 ' j 30-34 0 1 0 1 4 1 0 0 0 0 0 7 7 35 - 39 0 1 0 2 0 4 2 0 0 0 0 9 ~ 40 - 44 0 2 0 0 0 2 0 1 0 0 0 5 45-49 0 1 0 1 1 2 1 1 2 0 0 9 50 - 54 0 1 0 0 0 1 1 0 1 1 0 5 55-59 0 1 0 0 0 1 0 0 0 0 0 2 60 - 64 0 0 0 0 0 1 0 1 0 0 0 2 65+ 0 0 0 0 0 0 0 0 0 0 0 0 ~~ Total 4 10 0 7 7 13 4 3 3 1 0 52 21 VALUATION PARTICIPANT RECONCILIATION 1. Active lives a. Number in prior valuation 1011108 50 b. Terminations 0 i. Vested (partial or full) with deferred benefits 1 ii. Non-vested or full lump sum distribution received c. Deaths i. Beneficiary receiving benefits D ii. No future benefits payable 0 D d. Disabled 1 e. Retired D f. Voluntary Withdrawal g. Continuing participants 48 4 h. New entrants 52 i, Total active life participants in valuation 2. Non-Active lives (including benef SeNICe Retirees, Vested Receiving Benefits a Number prior 4 iciaries receiv Receiving Death Benefits D ing benefits) Receiving Disability Vested Benefits Deferred Total 1 12 17 valuation b. In 2 0 0 1 3 c. Out 0 D 0 2 2 d. Number current 6 0 1 11 18 valuation SECTION V SUMMARY OF-PLAN PROVISIONS 22 SUMMARY OF PLAN PROVISIONS (Through Ordinance No. 2008-18) Eli ibili Credited Service Sala Average Final Compensation Member Contributions Village and State Contributions Normal Retirement Full-time employees who are classified as Police Officers or Firefighters participate as a condition of employment. Total years and fractional parts of years of employment with the Village as a Police Officer or Firefighter. Gross Compensation, excluding bonases, sick and vacation pay, bu# including overtime. Average Salary far the 5 best years of the 10 years immediately preceding retirement or termination. 2.0% of Salary. Remaining amount required in order to pay current costs and amortize unfunded past service cost, if any, as provided in Part VII, Chapter 112, F.S. Date Earlier of: 1) age 55, regardless of Credited Service, or 2) age 52 and 25 years of Credited Service. Benefit 2.50% of Average Final Compensation times Credited Service, up #0 24 years; plus 0% of Average Final Compensation times Credited Service for each year after 24 years up to 30 years; 2.0% of Average Final Compensation times Credited Service for each year in excess of 30. Form of Benefit Ten Year Certain and Li#e Annuity (options available). 23 Early Retirement Eligibility Age 5Q, regardless of Credited Service. Benefit Accrued benefit, reduced 3% per year that the benefit commencement date precedes the Normal Retirement Date. Vestin Schedule 10Q% after 10 years of Credited Service. Benefit Amount Member wiH receive the vested portion of his (her) accrued beneft payable at the otherwise Early (reduced) or Normal Retirement Date. Disabili Eligibility Service Incurred Non-Service Incurred Covered from Date of Employment. 10 years of Credited Service. Exclusions Disability resulting from use ofi drugs, illegal participation in riots, service in military, etc. Benefit Benefit accrued to date of disability but not less than 42% of Average Final Compensation (Zb% for Non-Service Incurred). Duration Payable for life (with 120 payments guaranteed) or until recovery (as determined by the Board}. Optional forms of payment are available. Death Benefits Pre-Retirement {while employed) Vested Monthly accrued benefit payable to designated beneficiary for 1Q years at otherwise Early (reduced) or Normal (unreduced} Retirement Date. - Non-Vested Refund of accumulated contributions. 24 Death Benefits (continued} Pre-Retirement rafter employment) Eligibility Benefit Post-Retirement Cost of Living Increases Board of Trustees Vested terminated member who has reached age 50. Benefit payable as if member retired on the date of death, selected a 54% Joint and Survivor annuity, and then passed away, with 50% of the benefit then continuing to the survivor for life. Benefits payable to beneficiary in accordance with option selected at retirement. Up to 3% increase or decrease effective each October 1St in accordance with the Consumer Price Index, applied to all types of benefits. Two Members shall be Fire employees, and two shall be Police employees, all elected by the Village Fire and Police employees. The other Member, who wil! be the Chairman of the Board, must be a resident of the Village and shall be selected by the Village Council. SECTION VI GOVERNMENTAL ACCOUNTING STANDARDS BOARD DISCLOSURE INFORMATION 25 ~~ ~~~~~~ O O O O O nor~NU~ ' J O ~ O~ o > ;,~ rrOEl7n ~u~n~cn ¢ coU~~ ¢ v] = W _ h^- ~^ ~~ Or C37~0 M ~~ W m Q00r r O 0 CD N ' C f0 (~ O ~ Z ~~ p O O O O O O O E ~ o u~iQ~o~ Em VJ l- ~ ~ ooo~Niss~o 41 U1 ~-^ rti~(~ ~ N ~ C~ ~ ~ OOOCOrrN "®N ' ~ ~® W '~~ ~ ~ ~v o ~ MMN NN ~ ~.~a m .)" 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Q T r r r r 26 :, . i DISCLOSURE INFORMATION PER STATEMENT N0. 27 OF THE GOVERNMENTAL ACCOUNTING STANDARDS BOARD ANNUAL PENSION COSTS AND RELATED INFORMATION Contribution rates as of 9130109 Village 18.26% Plan Members 2.00°/a Actuarially Determined Contribution 507,357 Contributions made 599,505 Actuarial valuation date 10/1/2007 Actuarial cost method Aggregate Amortization method NIA Remaining amortization period NIA Asset valuation method 5 Year Smooth (Market} Actuarial assumptions: Investment rate of return 8.0% Projected salary increase* 6.0% * Includes inflation at 4.0% Post Retirement COLA 3.0% THREE YEAR TREND INFORMATION Actuarially Percentage Net Year Determined of APC * Pension Ending Contribution Contributed Obligation 9/30/2009 507,357 118% (264,986) 9/30/2008 715,784 100% (179,119} 9130!2007 539,651 100% (186,453) * Annual Pension Cost from Village sources. 27 DISCLOSURE INFORMATION PER STATEMENT N0. 27 OF THE GOVERNMENTAL ACCOUNTING STANDARDS BOARD DEVELOPMENT OF NET PENSION OBLIGATION (NPO) This municipal Defined Benefit Plan has been subject to the minimum funding standards since the adoption of the "Florida Protection of Public Employee Retirement Benefits Act" (Part VII of Chapter 112, Florida Statutes} in 1980. Accordingly, the sponsor has funded the actuarially determined required contributions for all years from October 1, 1987, through the transition date, October 1, 1997. Thus, the NPO on Octaber 1, 1997, is 0. The recent development of the Net Pension Obligation is as follows: 9130107 9130108 9130109 Actuarially Determined Contribution (A) 539,651 715,784 507,357 Interes# on NPO (15,567} (14,916} (14,330) Adjustment to (A} 23,701 22,250 20,611 Annual Pension Cost 547,785 723,118 513,638 Contributions Made 539,651 715,784 599,505 Increase in NPO 8,134 7,334 (85,867} NPO Beginning of Year (194,587} (186,453) (179,119) NPO End of Year (186,453) (179,119} (264,986}