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PUBLIC NOTICE — POLICE PENSION BOARD MEETING JUNE 20, 2017
The Police Pension Board will hold a regular quarter meeting Tuesday, June 20, 2017 at 10:00 a.m. in the City Council
Chambers, City Hall,1225 Main St. Sebastian, Florida.
Agenda
CALL TO ORDER
VOTE TO EXCUSE ABSENT BOARD MEMBER(S)
"Lei a, (KKslu Y11OWN Y
APPROVAL OF MINUTES:
A. Regular Meeting March 21, 2017
A. Approval of Payments:
a. Christiansen & Delmer (March) $ 2,034.29
b. Christiansen & Delmer (April) $ 2,638.44
c. Christiansen & Delmer (May) $ 551.10
d. Graystone Consulting $ 3,375.00
e. Salem Trust $ 1,635.00
B. Discussion of Glove Tax Claims
C. Review of Annual Calendar of Board Activities
D. Consider Ordinance for DROP, Cola and Buybacks
NEW BUSINESS
A. Report from Investment Monitor
B. Report from Investment Manager
C. Legal Updates
D. Board Member Reports and Comments
E. Next Quarterly Meeting: September 19, 2017
ADJOURN
Chairperson
Chairperson
Chairperson
Chairperson
Chairperson
Chairperson
Ken Killgore, Board Member
Ken Killgore, Board Member
Charlie Multinger, Morgan Stanley
Grant McMurry, Highland Capital Management
(The Board Attorney is not expected to attend.)
Chairperson
Chairperson
Please note: In accordance with Florida Statue 286.0105: any person who desires to appeal any decision at this meeting will need a record of
the proceedings and for this purpose may need to ensure that a verbatim record of the proceedings is made which includes the testimony and
evidence upon which the appeal is based.
In accordance with Florida Statute 286.26: Persons with disabilities needing assistance to participate in any of these proceedings should
contact the Administrative Services Department at 1225 Main Street, Sebastian, Florida 32958, or telephone 772-388-8205.
II 7
Sebastian Police Pension Board Minutes
March 21, 2017,10:00 a.m.
Sebastian City Council Chambers
TYPE OF MEETING: Regularly Scheduled
ATTENDEES: Board Members:
Robert Zomok, Secretary
Richard Snell
Ken Killgore
EXCUSED: Steve Marcinik, Chair
CONSULTANTS:
David Wheeler, Morgan Stanley, Grant McMurry, ICC Capital Mgmt.
(Portfolio Manager), H. Lee Dehner, Attorney, Doug Lozen, Actuary
GUEST: Cindy Watson, Human Resources Director, City of Sebastian
SUBJECT
CALL TO ORDER
Due to work scheduling conflicts, Steve Marcinik was unable to attend.
Richard Snell moved that Richard Snell Chair the meeting. Bob Zomok
seconded the motion and it passed unanimously.
10:00 a.m. There being a quorum present, Richard Snell, called the
meeting to order.
SUBJECT
PUBLIC COMMENT
None
Draft Minutes 3/21/2017
2
SUBJECT
APPROVAL OF MINUTES
10:05 a.m. Ken Killgore motioned the minutes of the Regular Meeting
on December 13, 2016. Motion was seconded by Richard Snell and
passed unanimously without change, for all meetings.
SUBJECT
OLD BUSINESS
A. Approval of Payments
a. Foster & Foster $119587.00
b. Christiansen & Dehner $ 29034.29
c. Highland Capital $ 44,745.46
d. ISU Jallad Insurance Services $ 3,021.05
e. Graystone Consulting $ 3,375.00
f. Christiansen & Delmer $ 29114.11
g. Salem Trust $19720.00
Richard Snell moved to approve the above expenditures. Bob
Zomok seconded the motion and it passed unanimously.
B. Year -to -Date Operating Expense for Year Ending
Richard Snell moved and Ken Killgore seconded a motion to
accept the Operating Expense report.
C. Discussion of Globe Tax Claims
(From 12/2016 meeting) This initiative may result in recouping a
small amount of funds from foreign investments. Lee Delmer
reminded the Board that this is usually a long process. Scott
Owens will Follow up.
David Wheeler and/or Scott Owens will follow up on this item. A
representative from Global will attend the June 2017 meeting.
Draft Minutes 3/21/2017
3
D. Review of Annual Calendar of Board Activities
The review of the monthly items for each quarter will be a
standing agenda item under Old Business. This item was covered
in the 3/21/2017 meeting.
E. Provide Direction to the Attorney to Draft Ordinance Changes
Ken Killgore requested that a draft be prepared by Attorney
Delmer within the next thirty (30) days. The draft will be an
Agenda item for the June 2017 meeting and a copy will be sent to
the Police Bargaining Association (PBA). Richard Snell moved to
approve and Bob Zomok seconded the motion. It passed
unanimously.
F. Consideration of Agreement for Pension Administrative Assistant,
Including Exhibit A Calendar of Activities and Scope of Services
Final recommendations/changes were made. Richard Snell moved
to approve the document as amended and Bob Zomok seconded
the motion. It passed unanimously.
G. Consideration of Updated Operating Rules
(The draft of the updated Operating Rules prepared by Attorney
Delmer was reviewed paragraph -by -paragraph using this draft
and the one prepared by Ken Killgore.
Lee Delmer will prepare a final draft to be reviewed by the Board
at the next quarterly meeting. From the 12/2016 meeting)
Ken Killgore moved to approve the final draft as amended and
Richard Snell seconded the motion. It passed unanimously.
SUBJECT
NEW BUSINESS
A. Review of Actuarial Report
Doug Lozen reviewed the actuarial report. For this year, the
required payment from the City of Sebastian will be 12.3%. For
next year, the requirement will be 15.8%. Doug then detailed the
reasons for the increase (found on page 7 of the report). They
include the change dictated by the State requiring the use of their
mortality tables, moving from an expected rate of return of 7.6%
to 7.45%, Further details are located on pages 8 and 10 in the
Draft Minutes 3/21/2017
0
report. Richard Snell moved to accept the Actuarial Report. The
motion was seconded by Ken Killgore and passed unanimously.
B. Report from Investment Monitor.
David Wheeler provided an overview of the current economy and
then reviewed the detailed report. The Fund performed positively
for the last quarter and for calendar year 2016.
C. Report from Investment Manager
Grant McMurry reported that the Fund had an increase of 3.36%
for the last quarter of 2016 and a 9.81% increase for calendar
year 2016.
D. Approval of Expected Rate of Return
The Board reviewed the Plan Valuation and approved an expected
rate of return of 7.45% as of 10/1/2016. Ken Killgore moved and
Bob Zomok seconded the acceptance of the 7.45% rate of return
and submit it to the State. The motion passed unanimously.
E. Submission of Annual Report to the State
Richard Snell moved to approve the completion of the Annual
report and submission of the report to the State. Bob Zomok
seconded the motion and it was approved unanimously.
F. Request to Update the Summary Plan Description
The Board agreed to wait until the revised Ordinance is approved
by the Sebastian City Council and the update the SPD. This is an
agenda item for the September 2017 regular meeting.
G. Legal Updates
Attorney Delmer noted the current State Legislature has nothing
on its upcoming agenda that would affect Police Pension Plans.
SB 306 is a current statute that requires Trustees to vote on each
issue present to the Board except where an individual board
member might receive a benefit from the issue presented.
SB 332 requires Police Pension Boards to forecast expected rates
of return for thirty (30) years into the future. This is a bill held
over from the last session and is not expected to pass.
Draft Minutes 3/21 /2017
H. Board Member Reports and Comments
Bob Zomok submitted his resignation from the Sebastian Police
Pension Board due to highly probable relocation. The Board
members thanked Bob for his many years of service and
contributions to the Sebastian Police Pension Board.
I. Next Quarterly Meeting: June 20, 2017
SUBJECT
ADJOURNMENT
12:20 PM. Having no further business for discussion, Richard Snell
adjourned the meeting.
Respectfully submitted,
Bob Zomok, Secretary
Sebastian Police Pension Board.
Draft Minutes 3/21/2017
CITY OF SEBASTIAN POLICE OFFICERS' PENSION PLAN
CALENDAR OF BOARD ACTIVITIES — Updated March 2017
JANUARY: No Board activity.
FEBRUARY: No Board activity.
MARCH: 1" Quarter Board Meeting:
• Update and Review Calendar of Activities.
• Request update of Summary Plan Description (every two years).
• Investment Report and Performance Review.
• Receive Annual Report to Division of Retirement.
APRIL: No Board activity.
MAY: No Board activity.
JUNE: 2" Quarter Board Meeting:
• Review Calendar of Board Activities.
• Investment Report and Performance Review.
• Select Board Chairperson and Secretary (every two years).
• Approve and Distribute to Members the Summary Plan Description (if needed).
JULY: Board Members should file Financial Disclosure forms by Julylst.
AUGUST: Receive State premium tax monies.
SEPTEMBER:
• 3rd Quarter Board Meeting:
• Agree on Quarterly Meeting dates for following year.
• Review Calendar of Board Activities
• Review Rate of Return Comparisons from Actuary.
• Approve Election Process for Police Officer Members (if needed).
• Select Board appointed Member and request City Council confirmation (if needed).
• Investment Report and Performance Review.
• Receive Report on Determination and Disclosure of Illiquid Assets/Securities.
• Report on year-to-date expenses and approve budget for the next year.
OCTOBER: No Board activity.
NOVEMBER: No Board activity.
DECEMBER:
• 4`h Quarter Board Meeting:
• Review Calendar of Board Activities.
• Consider changes to Operating Rules (if needed).
• Report on Actual Operating Expenses for the year.
• Investment Report and Performance Review.
• Update Investment Policy and Allocation Strategy.
• Accept the Actuarial Report.
• Approve Expected Rate of Return.
• Confirm renewal of Liability Insurance Policy.
Page i of 1
ORDINANCE NO. 0-
AN ORDINANCE OF THE CITY OF SEBASTIAN, FLORIDA,
AMENDING CHAPTER 58, LAW ENFORCEMENT, ARTICLE III,
POLICE OFFICERS' RETIREMENT SYSTEM, OF THE CODE OF
ORDINANCES OF THE CITY OF SEBASTIAN; AMENDING
SECTION 58-46, DEFINITIONS; AMENDING SECTION 58-48,
BOARD OF TRUSTEES; AMENDING SECTION 58-50,
CONTRIBUTIONS; AMENDING SECTION 58-51, BENEFIT
AMOUNTS AND ELIGIBILITY; AMENDING SECTION 58-55,
OPTIONAL FORMS OF BENEFITS; ADDING SECTION 58-70.1,
MILITARY SERVICE PRIOR TO EMPLOYMENT; ADDING
SECTION 58-70.2, PRIORPOLICE SERVICE; ADDING SECTION
58-70.3, DEFERRED RETIREMENT OPTION PLAN; ADDING
SECTION 58-70.4, REEMPLOYMENT AFTER RETIREMENT;
PROVIDING FOR CODIFICATION; PROVIDING FOR
SEVERABILITY OF PROVISIONS; REPEALING ALL
ORDINANCES IN CONFLICT HEREWITH AND PROVIDING AN
EFFECTIVE DATE.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
SEBASTIAN, FLORIDA, that;
SECTION 1: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amendedby amending Section 58-46,
Definitions, to amend the definition of "Retirement", to read as follows:
Retirement means amember's separation from city employment with eligibility for immediate
receipt of benefits under the system (or entry into the Deferred Retirement Option Plan).
SECTION 2: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amended by amending Section 58-48,
Board of trustees, subsection (a), to read as follows:
See. 58-48. Board of trustees.
(a) The sole and exclusive administration of and responsibility for the proper operation
of the system and for making effective the provisions of this ordinance is hereby vested in a board
of trustees. The board is hereby designated as the plan administrator. The board shall consist of five
(5) trustees, two (2) of whom, unless otherwise prohibited by law, shall be legal residents of the city,
who shall be appointed by the Sebastian City Council, and two (2) of whom shall be members of the
system, who shall be elected by a majority of the police officers who are members of the system.
The fifth trustee shall be chosen by a majority of the previous four (4) trustees as provided for herein,
and such person's name shall be submitted to the Sebastian City Council. Upon receipt of the fifth
person's name, the Sebastian City Council shall, as a ministerial duty, appoint such person to the
board as its fifth trustee. The fifth trustee shall have the same rights as each of the other four (4)
trustees appointed or elected as herein provided and shall serve a four (4) year term unless he sooner
vacates the office. Each resident trustee shall serve as trustee for a period of four (4) years, unless
he sooner vacates the office or is sooner replaced by the Sebastian City Council at whose pleasure
he shall serve. Each member trustee shall serve as trustee for a period of four (4) years, unless he
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sooner leaves the employment of the city as apolice officer or otherwise vacates his office as trustee,
whereupon a successor shall be chosen in the same manner as the departing trustee. Each trustee
may succeed himself in office. DROP narticinants can be elected as but not vote for elected
trustees. The board shall establish and administer the nominating and election procedures for each
election. The board shall meet at least quarterly each year. The board shall be a legal entity with,
in addition to other powers and responsibilities contained herein, the power to bring and defend
lawsuits of every kind, nature, and description.
SECTION 3: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amended by amending Section 58-50,
Contributions, subsection (a) Member contributions, to read as follows:
(a) Member contributions
(1) Amount.EbJ... al., 'd isimtirnis
to the ftmd in the f L., Effective on the
date of the adontion ofthe ordinance adopting this Wdreg� n- '^--^T—each
member of the system, 1:...4 r.i�. t /JJJ . 1, shteall be required to make
regular contributions to the fund in the amount of eight percent (8%) of his salary.
Police officer contributions withheld by the city on behalf of the member shall be
deposited with the board immediately after each pay period. The contributions made
by each member to the fund shall be designated as employer contributions pursuant
to §414(h) of the code. Such designation is contingent upon the contributions being
excluded from the members' gross income for Federal Income Tax purposes. For all
other purposes of the system, such contributions shall be considered to be member
contributions.
SECTION 4: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amended by amending Section 58-51,
Benefit amounts and eligibility, subsection (b) Normal retirement benefit and adding subsection (f)
Cost -of -Living Adjustment, to read as follows:
(b) Normal retirement benefit.
M The amount of the monthly retirement income payable to a member hired
prior to October 1, 2011 who retires sabsequent to May 31, 2002 and on or
after his normal retirement date shall be an amount equal to the number of the
members years of credited service multiplied by three (3) percent of his
average final compensation.
3dotwitl. 4.. l: s &- r.� �u7rtg sentence, f For members hired on or after
At.:1 11, ZH-2 October 1, 2011. the amount of the monthly retirement
income payable to a member who retires on or after his normal retirement
date shall be an amount equal to the number of d.,, years of credited
service multiplied by two (2) percent of his average final compensation for
the v ars ppf c}'g tod service evinnin oy or after April 11, 2012 and endit� .
October 1, 2U l and three 3 gercenl of average final comoeps tion for all
credited service before Ap(1 1, 2012 and after October
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(f) Cost -of Living Adiustment. F re retirees with a minimum of fifteen J15) years of
credited service shall receive a one Percent (?/o akmax o$ of -living ad'ustment b� nning on
the first October 1 following the attainment of age fifty-ei t 158). The COLA is applicable to all
forms ofretiremen� includinpr normal and early retirement. terminated vested, disability retirees and
Pre -retirement deat�i beneficiaries.
SECTION 5: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amended by amending section 58-55,
Optional Forms of Benefits, subsection (a)(4), to read as follows:
**a
(4) F9r meTbers who do not Particinatek the DROP Pursuant to Section 58-70.3, the
�r member may elect a percentage of benefit in a lump sum as follows:
a. Five (5) percent of the total actuarial equivalent value of the benefit paid as
a lump sum with the remaining ninety-five (95) percent paid under the
normal form or as per (1), (2) or (3) above.
b. Ten (10) percent of the total actuarial equivalent value of the benefit paid as
a lump sum with the remaining ninety (90) percent paid under the normal
form or as per (1), (2) or (3) above.
C. Fifteen (15) percent of the total actuarial equivalent value of the benefit paid
as a lump sum with the remaining eighty-five (85) percent paid under the
normal form or as per (1), (2) or (3) above.
d. Twenty (20) percent of the total actuarial equivalent value of the benefit paid
as a lump sum with the remaining eighty (80) percent paid under the normal
form or as per (1), (2) or (3) above.
e. Twenty-five (25) percent of the total actuarial equivalent value of the benefit
paid as a lump sum with the remaining seventy-five (75) percent paid under
the normal form or as per (1), (2) or (3) above.
SECTION 6: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amended by adding Section 58-70.1,
Military service prior to employment, to read as follows:
Sec. 58-70.1. Military service Prior to emplovment.
The vears of frap�i9n I Parts of years that a polioe(9fficer s ryes or has sery@d oq activ duty
in the military service of the ed Forces of the UniteJStates, the United States Merchant urine
or the United States Coast Guard, voluntarily or involuntarilX and honorably or under honorable
conditions, Qrior to first and initial employment with the city Police department shall be added to his
vears of credited service provided that:
on�ember coph7butes to the fund the sum that he would have contributed, based
nis salary and the member contribution rate in effect at the time that the credited
service is requested, had he been a member of the system for the vet$ or fractip I
parts of years for which he is requesting credit Plus amounts actuan'all determined
such that the crediting of service does not result in anX cost to the fund n us Day
pient
of costs for all Professional servic,ps rendered to the board in connection with the
Purchase of vears of credited service.
-3-
Multiple requests to purchase credited service pursuant to this section may be made_
at any tim@@prio to retirement, in one year increments. upon the completion of five
(5) years of credited service.
Payment by the member of the required amount shall be made within six (6) months
of his request for credit, but not later than 1hp retir@pe�rt date, and shall be made in
one lump sum payment upon receipt of which credited service shall be given.
(4) The maximum credit under this section shall be four (4) years.
(5) Credited service purchased pursuant to this section shall count for all purposes,
except vesting. T
SECTION 7: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amended by adding Section 58-70.2,
Prior police service, to read as follows:
Sec. 58-70.2. Prior volice service.
Unless othep/vise prohibited by law, and except as provided for in section 58-46, the years
or fractional parts of nears that a rr��tuber previ slv served as a full-time golice officer with the city
during a period of revious enm ovmcm and for which period accumulated contributions were
withdrawn from the Baud, or the Xears and fractional arts of years that a member served as a full-
time police officer or the Years and fractional parts of'vears that a me b��}}'' s ped as apolice officer
for v o er municipal, cour jv or state law enforcement department in fhe Mate of Florida shall be
added to is years of credited service provided that:
Th ,ner�per copl 'butes to the fund the sum that he would have contributed, based
on �is salary and the emb@x contributipn ra e m effect at the time that the credited
service is requested„.ad he been a member of the system for toe Years or fractional
pa f ve rs for which he is requesting credit plus amounts actuarially� determined
such that the crediting of service does not result in an q cost to the fund talus pa ent
of costs for all professional services rendered to the board in connection with the
purchase of years of credited service.
(2) Multiple requests to mirchase credited service pursuant to this section may be made.
a Y tim@ Drip to retirement, in one year increments, upon the completion of five
(51 years of credited service.
Pavrjent by the police officer of the required amount shall be made within six f6)
months of his request for credit, but not later than the retirement date, and shall be
made in one lump sum payment upon receipt of which credited service shall be
iven.
The maximum credit under this section for service other than with the City of
Sebastian shall be four (4 ears of credited service and shall count for all purposes,
except vesting, There shall e nor c m }n �ur�]pse of credit for prifr yervice with
the City of Sebastian and such credit s�all count for all purposes, including vesting.
In no event, ho}�ever, v creditpq service be purchase, pur uant to this section for
Dr fir serrvvice with any ootf er rpumcw�l. marry or st tte�law enforcement der�arhnent
yolice deoartmen 'such p�}�r service forms or wrtil form the basis of a retirement
benefit or pe1}$jpn ifc a different employees retirement system or plan as set forth,
in section 5 -60 subsection (1)(2).
0
Foryu oses of de$err� }�¢ credit to Drior se�yice as a Dolice officer as Drovided
for m this section m addition to service as a nolice officer in this state, credit may
be purchased by t ie Timber in JJ e sh e manner asprovided above for federal, other
stale, co ptv pr T�}umc1n 11\service i the Drjo� servi�e� is recoe }zed by the Cnminal_
Justice �tandards and Trainin¢ Commission wi hin the DeDartment of Law
Enforcement, as Drovided under Chanter 943, Florida Statutes, or the police officer
Drovidps tlrj9 o the board that such service is iv equa ent to t e service required to
meet the a nrtron of a Dolice officer under Sec. 58- 6, above.
SECTION 8: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amended by adding Section 58-70.3,
Deferred retirement option plan, to read as follows:
See. 58-70.3. Deferred Retirement Option Plan.
(a) Definitions. As used in this section 58-70.3. the following definitions avoly:
"DROP" -- The City of Sebastian Deferred Retirement Ontion Plan.
"DROP account" -- The account established for each DROP narticinant under
subsection (c).
bb) Participation.
Eligibility to nartici.kate. In lieu of torfnin7tine his emDloyment as a Dolice officer,
any member who is eligible for normal retirement under the system and who is not
on unnaid leave status may elect to defer receipt of such service retirement nension
and to DarticiDate in the DROP.
Election to. garticinate. A member's election tp ppa iclhate in the DROP must be
made i�j wr1mg�g a time and manner determined by e board and shall be effective
on the first day ofthe first calendar month which is at least fifteen (15) business days
after it is received by the board.
Period of Darticivation. A member who elects to narticiii2ate in the DROP under
subsection (b)(2), shall narticinate in the DROP for a neriod not to exceed sixty (60)
months beginning at the time his election to 1 D to in the DROP first becomes
effective. An election to narticinate in the shall constitute an irrevocable
election to resign from e service of the ciV not later than the date provided for in
the previous sentence. member may particinate only once.
Termination ofvarticivation.
a. A member's Darticination in the DROP shall cease at the earlier of:
1. the end of his permissible neriod of narticiDation in the DROP as
determined under subsection (b)(3): or
2. termination of his emnlovment as a Dolice officer.
b. Upon the member's to ination of D� ilnat�on in the DROP pursuant to
subsection 1 above, all amounts rorov ded, for in subsection (c)�2) including
monthly benefits and interest, shall cease to be tr qI`e�Ir(}r'e from t)le system
to his DROP account. Any amounts remaining in his UK(P account shall be
-5-
paid to him in accordance with the provisions of subsection (d) when he
terminates his emolovment as a nolice officer.
C. A member who terminates his ?art .cioatiop in the DROP under this
subsection (b)(4) shall not be Dermittel to again become a participant in the
DROP.
(5) Effect ofDROP narticioation on the system.
a. A member's credited service and his accrued beef t under the s stem shall
be determined on the date his election to t)artici ate in the DROP first
becomes effective. For purposes of determining the accrued benefit, the
member's salaw for the Dumoses of calculating,his average final
cog, ,nsat'q shall include an amount eaual to any lunm sum Dayrr)ents
wh wouidlave been raid to the m mber and included as sale as defined
herein,had the member retired under normal retirement and not elected
DROP D f ' ip t on. Member coptributior}g attributable to any lumn sums
used in e beve�it calculation and not actually received by a member §j 11
be deducted from the first navrpents to the member's DROP account. The
member shall not accrue any additional credited service or any additional
benefits under the system (except for any supolemental benefit Davable to
DROP qarticiDants or any additional benefits provided under any cost-of-
livin ad ustment for retirees in the system while he is a particinant in the
DRO . �fteri memb x commences yp ja�(X mpptio he shall not be permitted
to gain cog b to to to system nor shape be eligible for disability or Dre-
retuement dea benefits.
b. No amounts shall be Raid to mber �ioir�the system whil the membej�s
a D cipant in the DROP. Un�ess otherwise saecified in the system, it a
� embeL s Darticination ]p the DROP is terminated other than by terminating
his emnlovrnent as a Dolice officer, no amounts shall be paid to him from the
system until he terminates his emnlovment as a police officer. Unless
otherwise s ecified in the system, ani nts trat�sferrK from the system to the.
member's DROP account shall be Dar directly to the member only on the
termination of his emnloyment as a Dolice officer.
(c) Funding.
Establishment of DROP account. A DROP account shall be established for each
member Dartic atz in the DROP. A member's DROP account shall consist of
amounts transferred to the DROP under subsection (c)(2), and interest on those
amounts.
Transfers from retirement system.
a. As of the first dad� of each month of a z�e�nber's pep'od of mart*cingdoq in the,
DROP the monthly retirement benefit he would have received under the
system�iad he terminated his emgqtovg�ent as a Dolice officer and elected to
receive monthly benefit pa ents thereunder shall be transferred to his
DROP account, except as opeTiset Dr vided for in subsection (b)(4)b. A
member's period of Darticjpatio in the DROP shall be determined in
accordpnc� with the provisions subsections (b)(3) and (b)(4), but in no
event shall it continue past the date he terminates his emnlovment as a Dolice
officer.
Sn
b. ExcePt as otherwise provided in subsection (b)(4)b. a member's DROP
account under this subsection (c)(2) shall be credited with interest at an
effective rate of one and three tenths Vercent (1. 3 %1 Der apnum co,�pppo �d
monthly determined on the last business day of the Prior month's en ing
balance and credited to the member's DROP account as of such date.
C. A member's DROP account shall onlx be credited with interest and monthly
benefits while the Tenter 1is arpar�iCIT) rn the DROP. A member's final
DROP account value for dlistnbutron to e mber upon termination of:
Partic Nation in the DROP shall be the value oTtile account at the end of the
month immediately Preceding termination of Darti iDation Plus anv monthly
Periodic additions made to the DROP account subsequent to the end of the
previous monti� and x7rior to distribution. If a r>jember fails to terminate
emt�lovment af{er�artipina�tne in the DROP for the permissible Period of
DROP Partic��'pp tiori, then beeinnir� with the member's first month of
em lovment foowu� the last mont of the or in
period of DROP
Varticipation, the mein er's DROP account will no loneer be credited with
interest, nor will monthly be be transferred to the DROP account. All
such non -transferred amounts shall be forfeited and continue to be forfeited
while the member is emnloved by the Police departmen and no cost -of-
liy'n¢ diusrents shall be at7Plied to the me�pber _credit during such Period
of con inued =2 ovment. A member eroDlove�b_v the Rolice deParhnent
after the ermissible Period of DROP Dart�'ioatiq y ill still not be eligible
for rejetirepent death or disabilitv benefits and will not accrue additional
credited service.
Distribution ofDROP accounts on termination ofemolovment.
Elieibility for benefits. A member shall receive the balance in his DROP account in
accordance with the Provisions of this subsection (d) agon his termination of
em lovment as a Police officer. Except as Drovide(1 in subsection (d)J5). no amounts
shaW be Paid to a member from the DROP Prior to his termination of emplovment as
a police officer.
Form of distribution.
a. Unless a m@mber elects otherwise dig butio of his DROP account shall
be made in a lumrLsum, subject to le direct ro�oyernroyisiops set forth in
subsection (dJ(6). Elections under this Para¢ranh shall be in wntm¢ and shall
be made within sixtv (60) days.
b. Notwithstanding thg pr�cydir�,if a member dies before his benefit is Paid,
his DROP account steal bepai to his beneficiary in such optional form as
his bene - rev select. If no beneficiary desienation is made, the DROP
account shall be distributed to the member s estate.
Date ofgavment ofdistribution. Excent as ot�( ffise niovided in this s sVctioq (d)l
distribution of a member's DROP account shall be made as soon V gdI im$ratrvely
Practicable following the member's termination of emPlovn1ent. Dist ribution of the
amount in a Member's DROP account will not be made unless the Member
completes a written request for distribution and a written election, on forms
designated by the Board, to either receive a cash lump sum or a rollover of the lump
sum amount.
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(4) Proofofdeath and right of beneficiary or other Person. The board may require and
rely upon such proof of death and such evidence of the r�'gJit of any bene�lci ry or,
otherpperson to receive the value of a deceased member's DROP account as the board
may them proper and its determination of the right ofthat beneficiary or other person
to receive payment shall be conclusive.
Distribution limitation. Notwithstanding any other provision of subsection id), all
distributions from the DROP shall conform to the "Minimum Distribution Of
Benefits" provisions as provided for herein.
Direct rollover ofcertain distributions. This subsection aRRies to djSt 'b t* s ma, e
on or after Janu 1. 2002. N twith,Standing any pr vision of the D OP to the
contr�ry� a distributee may elect to have and portion ot" an eligible rollover
section on 691onV�pp. aid in a direct rollover as otherwise provided under the system in
sec58-
(e) Administration ofDROP.
(1) Board administers the DROP. The eneral d�lnLst�atio�r of the DROP the
resnonsibiliw fir carrvine oy� e pTcw�}�ns of t e DROP_ and the responsibiti�y of
overseeing the investment of me DROP s assets shall be placed in the board. The
members of the boato May aptloint from th it n er such subcopa nittees yvith such
powers as they shall determine ma(wont suc1 ni�jj-�hve procedures and
regulations as they deem desirable for the conduct of their ai airst may authorize one
or more of their number or any agent to execute or deliver any insgttme t or make
anv ayment on their behalf- mayretain counsel, employ agents andnrovrle for such
clerpcal, accountin_ g actuari 1 and consulting services as they mayreauire i&carrvine
out the Drovisio oY the DROP: and may allocate among themselves or delegate to
other D rsops all or such portion of their duties under the DROP, other than those
}'anted to the as s e andir aanytru t aar@et�ept d Dte�1 for use t imnlementing,
canted
as relating yi exclusively to hitmor�, shall decide. A trustee s�all not vote on
Individual accounts. records and re orts. The board shall aigtaiq recpr4p showing
the operation and condition of the DROP, inclutijgg recors showing the individual
balances in each member's DROP account, and e board shall keen in convenient
form such data as may be necessary for the valuation of the assets and liabilities of
the DROP. The board shall preppare and distribute too members vartic Dating jn the
DROP and other individuals or f1e with the appropriate eovemmentat agencies as,
the case may bey all necessy descriptions, reports, inform do rgturns and data,
required to be distributed or filed for the DROP pursuant to the Code and any other
applicable laws.
Establishment ofrules. Subject to the limitations of the DROP the board from time
to time shall establish rules for the akinissration of the DROQ and the trrsaction
of its business. The board shall have disgretioqpry authority to cc��� le 1r) interpret
the DROP (including but not limited to eteMinatipnofanindivi uall'seig�bili��yyfot
DROP particinatig�hhe rapt and amount of any benefit payable under the D1tOP,
and the dilate on wlluuc an individual ceases to be a artici ant in the DROP. The
d t rm' rtion Qf the boar as to the intetpreption r me DROP or its deterrr�rna�tpn
of any disputed questions shall be conclusive and final to the extent Dermitted by
applicable law.
Ira
Limitation of liability.
a. The trustees shall not incur any liability individually or on behalf of any other
individuals for any act or failure to act, made in good faith in relation to the
DROP or the funds of the DROP.
b. Neither the board nor any trustee of the board shall be responsible for any
reports furnished by any expert retaine or emoloved by the board, but they
shall be entitled to rely thereon as well as on certificates fumished by an,
accountant orn %ctuarv, and on all opinions of counsel. The board shall be
fully protected with respect to any action taken or suffered by it in Uood faith
in reliance upon such ex en, accountant, actu�v or counsel, and all actions
taken or suffered in such reliance shall be conclusive un_ on any person with
any interest in the DROP.
(f) General provisions.
The DROP is not a separate retirement plan. Instead, it is a Droerar�under which
g member who is eligible for normal retirement }tp er Are system maY elect to accrue
future r tireyy�e'it benefits in the �nar�ner provide in this section 58-70.3 for the
remaine er of'his emplovmen rather than m the normal manner provided under the
glan. Upon termination oemplovmenk, a member is entitled to a lumqp sum
distribution of It or her DROP account balance o� may elect a rollover. The LROP
account distribution is in addition to the member s monthly benefit.
Notional account. The DROP account established for such a member is a notional
account, used only for the jur�ose of calculation of the DROP distribution amount.
It is not a separate account in the system. There is no change in the sNstem's assets,
and there is no distribution available to the member until the members termination
from the DROP. The member has no control over the investment of the DROP
account.
No emolo er discretion. The DROP benefit is determined _pursuant to a snecific
formula which does not involve employer discretion.
IRC limit. The DROP account distribution, along- with other b n�, fits payable from
the system, is subject to limitation under Internal Revenue Code Section 415(b).
Amendment of DROP. The DROP may be amended by an ordinance of the city at
any time and from time to time, and retroactively if d5.epedt�e�es,Sa�v pgropriate.
to amend in whole or in part any or all of the provisions o£ the DR� However,
excent as otherwise provided by law no amendment shall make it Qossible for any.
part of the DROP's funds to be used �or or diverted to, is oses other than for the,
exclusive benefit of persons entitled to benefits under the �ROP. No amendment,
shall be made which has the effect of decreasing the balance of the DROP account
of any member.
act !A
, of payment. If a member or other Derson entitled to a benefit under the
DROP is unable to care for his affairs because of illness or accident or is a minor the
board shall direct that any benefit due him shall be made only to a duly appointed
IF E I r�pre, egta ' An gavi ent so made shall be a compete discharge of the
liabilities o� the li OP for that benefit.
Information. Each member, bgeficiarvor other verso entitled to a benefit before
any benefit shall be payable to im or on is account un er e DROP, shall file with
the board the information that it shall reauire to esta isis rights and benefits
under the DROP.
0
Prevention of escheat. If the board cannot ascertain the whereab jts of anv person
to whom a oavment is due under the DROP, the board may, no carper than three f 3),
years from the date such nayipent is due mail a notice of such due and owing
pam}ent to the last known address of suc(1 person, as shown on the records of the.
board or the city. If such person has not made written claim therefor within three (3).
months of the date of the mailing, the board may, if it so elects and upon receiving
advice from counsel to the system direct that such payment and all remaining
pa entsgj,�e�w. duesuchpersonbecanceled onthe records ofthe system. Upon.
such cancellation, the system shall have no further liability tier fte cept that, in the
event such person or his beneficiqv later notifies the board ofhis whereabouts and
requests the paTentpr payments due to him under the DROP the amount so applied
shall be paid to him m accordance with the provisions of the�ROP.
Written elections. notification.
a. Any elections, notifications or designations made by a member pursuant to
�heprevisions pf the DROP shall bemade'pv�'tip anfiled with the board
in a time and manner determined by the boarl under rules uniformly
anr�I*cable to all employees similarly situated. The board reserves the right
to change from time to time the Crrrlanrlf rpfk) �nolificatipirs, elections
or desigetions by members under the j�ROp if t determines after due.
deliberation that such action is iustified in that it irq�oves the adjjnistra n
of the DROP. In the event of a conflict between the provisions for making
an election, notificati on or srenation set forth in the DROP and such new
administrative DroceSures, those new administrative procedures shall prevail..
b. Eac vember pr Retiree who has a DROP account shall be responsible for
furnishing the board with his current address and any subseogent changes in
his address. Any notice required to be given to a member or Retiree
hereunder shall be deemed Riven if directed to him at the last such address
�}yen to the board and mailed by registered or certified United States mail,
f any check mailed by registered or certified United States mail to such
address is returned,, mailing of checks will be suspended until such time as,
the member or Retiree notifies the board of his address.
10 Benefits not,euaranteed. All benefits na able a member o the DROP shall be,
paid only from the assets of $e minber's DROP account and neither th@ city nor tie.
board shall have any duty or liability to furnish the DROP with any funds, securities.
or other assets except to the extent required by any applicable law.
11 Construction.
a. The DROP shall be construed, rey, lated and administered under the laws of
Florida, except where other applicable law controls.
b. The titles and heading, of the subsections in this section 58-70.3 are for
convepiei) e onl . In the case of ambiguity or inconsistency, the text rather
than the tit�es or leadinas shall control.
Forfeiture of retirement benefits. Nothin�in this section shall be construed to
remove DROP Darticipants from the aDp ication of any forfeiture provisions.
applicable to the system. DROP articivants shall be subject to forfeiture of all
retirement benefits, including DRt� benefits.
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Effect ofDROP Participation on emplovment. Participation in the DROP is not a
guarantee of emnlovpient and DROP yarticipants shall be subiect to the same
em, lovment standards and policies thaf are applicable to employees who are not
DIP participants.
SECTION 9: That Chapter 58, Law Enforcement, Article III, Police Officers' Retirement
System, of the Code of Ordinances of the City of Sebastian, is amended by adding Section 58-70.4,
Reemployment After Retirement, to read as follows:
See. 58-70.4. Reemplovment After Retirement.
(a) Any retiree under this system, except for disability retirement as previously provided
for, may be reemployed by any public or private employer, except the city, and may receive
coin ensation from that employment without limit or jest�is ppa in any way the retirement
�eg4ts Vgvable under this system. Reemployment by t�e city shaf�be subiect to the limitations set
ort in this section.
After normal retirement. Any rerireeyvhoisretired under normal (or early) retirement
pursuant to this system and who is reemployed as a police officer and, by virtue of that
reemplov}gent is el' }ble to participate in this system, shall upon being reemployed, discontinue
receipt )pen
Mop reemploy�r�en� the member shall be deemed to be fulIN vested and the,
additional credited service accrued durmQ the subsequent employment period shall be used in
comvutirWasecond benefiit r oun it butabletothesubsequentemn�lovmentDej}od,whichbenefit
amount shall be added to tee bene�it determined upon the initial retirement to �etermine the total
benefit payable upon final retirement. Calculations of ben fitsi�ioqq retirejnen� shall be based upon
the benefit accrual rate, average final cpmpen a�ton, an credited service (and early retirement
reduction factor` if aroplicable) as of that date and the retirement benefit aTo t for any subsequent
erry�lo ent period shall be based upon the benefit accrual rate. average final pp�psati9n (based
only on the subsSpi , in mg�lovment period and not includine any penod of M, n�ticmation).
and credited service �an�early refire ent r,9duction facto ifanplicable) as ofthe date of subsequenf
retirement. The amount of any death or disability ben ffit re iyye during a subsequent enod of
employment shall be reduced by the amount of accrued bene t el�ble to be Daid for/ gqnor period
ofemployment. The optional form of benefit and any iointpensioner s lecteduroonimtialretirement
shall not be subiect to c ge upon subsequent retj�etlrient extent as o� er' ise ro}ovicj d herein, but
the, retireeI�av se�lect a Ierent otniona� form and tomt pensioner am) Icable only to the subsequent
retirement benefit.
(c) Any retiree who is retired under normal retirement pursuant to this system who is
reem,ploved by the City in aposition other than as a police officer, shall upon being reemt�loved.
con�iilue rece)Dt of benefits for the period of any subsequent employment period. Former loved
participants shall begin receipt of benefits under these circumstances.
Afer early retirement. Any retiree who is retired under early re j�rement ppursua t to
this system and who subsequently becomes an em lovee of the ci�v in any can itv, shall discontinue
recei t of benefits from the system. If the reeirm oved person, by virtue o is reemplonent, is
eligible to garticiDate in this system, that person shall accrue a second benefit as provided for in
subsection (b) above and benefit Fnts shall remain suspended during any such subseauent
employment period. If the reemployed person is not ell able to oarticiDate in this system, that
person s pension enefit D vin@nts shall be suspended until ell, earlier ofterq}inati99LOU,
o � Dlovment
or such time as t1�e reemD�oved retiree reaches the date that he would have been eliQi( lct normal
retirement under this system had he continued employment and not ,elected early retirement.
"Normal retirement" as used in this subsection shall be the current normal retirement date provided
for under this system.
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(e) Reemvlovmentof3erminatedvested nersons. Reemplovedterminated veS get)ersgns
shall not be subiect to the q}�ovislpns ofthis section until such time as thcvbcRin to actua ryreceive,
benefits. Upon receipt of benefits, terminated vested persons shall be treated as normal or early
re frees o npprppges of applvir�g th proyyisio4s of this section and their status as an early or normal.
retiree s a I be determined by the Tate thev elect to beein to receive their benefit.
DROP Partici ants. Me�p e s o retl ees who ale or were in the deferred retifegent.
of tion tl n shall have the options provide or in this section for reemployment upon termination
of employment.
SECTION 10: Specific authority is hereby granted to codify and incorporate this Ordinance
in the existing Code of Ordinances of the City of Sebastian.
SECTION 11: All Ordinances or parts of Ordinances in conflict herewith be and the same
are hereby repealed.
SECTION 12: If any section, subsection, sentence, clause, phrase of this ordinance, or the
particular application thereof shall be held invalidby any court, administrative agency, or other body
with appropriate jurisdiction, the remaining section, subsection, sentences, clauses, orphrases under
application shall not be affected thereby.
SECTION 13: That this Ordinance shall become effective immediately upon adoption by
the City Council.
The foregoing Ordinance was moved for adoption by Councilmember
The motion was seconded by Councilmember and upon being put to a vote, the
vote was as follows:
Mayor Bob McPartlan
Vice Mayor Andrea Coy
Councilmember Jim Hill
Councilmember Ed Dodd
Councilmember Linda Kinchen
PASSED ON FIRST READING, this day of 12017.
PASSED AND ADOPTED ON SECOND READING, this day of
, 2017.
ATTEST:
CITY CLERK
Approved as to form:
CITY ATTORNEY
ksh\dm\sebms pol\06-05-17.ord
MAYOR
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