spd2010 finalpp[1]

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Plan Plan Benefits Benefits

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Page 1: Spd2010 finalpp[1]

Plan Plan BenefitsBenefits

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Members of the BoardMembers of the Board

ElectedElected    Michael Dew- ChairmanMichael Dew- Chairman Ken Rudominer- Vice ChairmanKen Rudominer- Vice Chairman Richard Fortunato- SecretaryRichard Fortunato- Secretary J. Scott Bayne- Fire TrusteeJ. Scott Bayne- Fire Trustee AppointedAppointed Mark Burnam- TrusteeMark Burnam- Trustee Jim Naugle- TrusteeJim Naugle- Trustee Board ElectedBoard Elected Dennis HoleDennis Hole Ex-Officio –Non-votingEx-Officio –Non-voting Lynda Flynn – Acting Finance DirectorLynda Flynn – Acting Finance Director

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ContributionsContributions Members are required to contribute 8% percent of their earnings to Members are required to contribute 8% percent of their earnings to

the Pension Plan. This will increase to 8.25% on October 1, 2011. the Pension Plan. This will increase to 8.25% on October 1, 2011. Members hired after April 18, 2010 contribute 8.5% of their Members hired after April 18, 2010 contribute 8.5% of their earnings to the Plan.earnings to the Plan. Earnings include base wages, assignment pay, Earnings include base wages, assignment pay, longevity, City & State academic pay, temporary upgrade pay, shift longevity, City & State academic pay, temporary upgrade pay, shift pay, certification and First Responder pay for Firefighters, and forty pay, certification and First Responder pay for Firefighters, and forty (40) hours per year of overtime for Police Officers. Pension Plan (40) hours per year of overtime for Police Officers. Pension Plan contributions are not included in taxable income contributions are not included in taxable income

During periods of non-service incurred disability, sick leave, During periods of non-service incurred disability, sick leave, vacation, authorized leave of absence and military service you are vacation, authorized leave of absence and military service you are required to continue contributions. Police Officers & Firefighters required to continue contributions. Police Officers & Firefighters that have made the election for a maximum accrual at 81% are only that have made the election for a maximum accrual at 81% are only required to contribute 1% upon reaching 24 years of service. required to contribute 1% upon reaching 24 years of service.

The State of Florida provides a portion of insurance premiums to the The State of Florida provides a portion of insurance premiums to the fund for the express purpose of funding retirement benefits for fund for the express purpose of funding retirement benefits for police officers and firefighters in the City. The City is required to police officers and firefighters in the City. The City is required to contribute the amount necessary to maintain the Plan on a sound contribute the amount necessary to maintain the Plan on a sound basis as determined annually by an independent enrolled actuary.basis as determined annually by an independent enrolled actuary.

It is not possible for members to borrow against their contributions It is not possible for members to borrow against their contributions to the Plan.to the Plan.

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Contribution RefundsContribution Refunds If you leave employment with the City before completing at least 10 If you leave employment with the City before completing at least 10

years of service, you are not eligible for benefits. The money you years of service, you are not eligible for benefits. The money you contributed to the Plan, plus 3% interest, compounded annually on contributed to the Plan, plus 3% interest, compounded annually on December 31, will be refunded to you.December 31, will be refunded to you.

If you leave after completing 10 or more years of service, you are If you leave after completing 10 or more years of service, you are eligible for a deferred, vested benefit, but you may choose to withdraw eligible for a deferred, vested benefit, but you may choose to withdraw your contributions. When you withdraw your contributions, you forfeit your contributions. When you withdraw your contributions, you forfeit any vested retirement benefits you may be entitled to.any vested retirement benefits you may be entitled to.

As of January 1989, the money you contribute to the Pension Plan each As of January 1989, the money you contribute to the Pension Plan each payday has not been included in earnings subject to Federal income tax. payday has not been included in earnings subject to Federal income tax. This means that your taxable income does not include the amount you This means that your taxable income does not include the amount you contributed to the Pension Plan each year. If you leave employment, and contributed to the Pension Plan each year. If you leave employment, and receive a refund of your contributions plus accrued interest, the amount receive a refund of your contributions plus accrued interest, the amount you contributed after January 1989 becomes taxable income. This you contributed after January 1989 becomes taxable income. This money will be subject to the mandatory Federal income tax withholding money will be subject to the mandatory Federal income tax withholding of 20% as well as a 10% excise tax.  of 20% as well as a 10% excise tax.  

You may defer Federal income tax, and avoid the mandatory 20% You may defer Federal income tax, and avoid the mandatory 20% withholding for income tax, by directing the City to transfer the untaxed withholding for income tax, by directing the City to transfer the untaxed portion of your contributions to an Individual Retirement Account (IRA) portion of your contributions to an Individual Retirement Account (IRA) or another qualified pension plan. Contact the Pension Office for or another qualified pension plan. Contact the Pension Office for specific information. specific information.

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Vested RetirementVested Retirement If you leave employment with the City after completing 10 or more years of If you leave employment with the City after completing 10 or more years of

service you have a vested deferred retirement benefit. The monthly benefit is service you have a vested deferred retirement benefit. The monthly benefit is calculated at Normal Retirement. This benefit is payable when you would calculated at Normal Retirement. This benefit is payable when you would have completed 20 years of service. If you should die prior to reaching your have completed 20 years of service. If you should die prior to reaching your normal retirement date, your contributions plus three (3) percent interest normal retirement date, your contributions plus three (3) percent interest shall be paid in a lump sum to your designated beneficiary. shall be paid in a lump sum to your designated beneficiary.

If vested with 15 years of service, and you should die prior to If vested with 15 years of service, and you should die prior to commencement of your retirement, your spouse and eligible children will be commencement of your retirement, your spouse and eligible children will be entitled to survivorship benefits, commencing on what would have been your entitled to survivorship benefits, commencing on what would have been your normal retirement date.normal retirement date.

At any time before retirement, a terminated vested member can choose to At any time before retirement, a terminated vested member can choose to withdraw contributions. If you choose to withdraw your contributions, you withdraw contributions. If you choose to withdraw your contributions, you forfeit your right to any future benefits.forfeit your right to any future benefits.

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Retirement BenefitsRetirement Benefits

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Normal RetirementNormal Retirement You are eligible to retire upon the completion of twenty (20) years of You are eligible to retire upon the completion of twenty (20) years of

creditable service with the Police or Fire Department. Also a creditable service with the Police or Fire Department. Also a member who has completed ten (10) or more years of creditable member who has completed ten (10) or more years of creditable service and has reached the age of 55 is eligible to retire. Upon service and has reached the age of 55 is eligible to retire. Upon retirement you will receive pension benefits on the first of working retirement you will receive pension benefits on the first of working day of each month continuing for your lifetime. The Plan is a day of each month continuing for your lifetime. The Plan is a defined benefit plan and uses the following formulas to define the defined benefit plan and uses the following formulas to define the amount of your benefit.amount of your benefit.

Police Officers and Firefighters, except those otherwise specified Police Officers and Firefighters, except those otherwise specified

below will have a monthly benefit equal to 3.38% of average below will have a monthly benefit equal to 3.38% of average monthly earnings for all years of service to a maximum accrual of monthly earnings for all years of service to a maximum accrual of 81% of final average monthly earnings. All Firefighters also receive 81% of final average monthly earnings. All Firefighters also receive a 2% bonus at retirement if hired prior to December 31, 1993. a 2% bonus at retirement if hired prior to December 31, 1993.

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Normal Retirement…Normal Retirement… Final average monthly earnings can be found by adding your highest Final average monthly earnings can be found by adding your highest

2 years earnings and dividing the sum by 24 months. Earnings 2 years earnings and dividing the sum by 24 months. Earnings include base wages, assignment pay, academic incentive pay, upgrade include base wages, assignment pay, academic incentive pay, upgrade pay and longevity. Police Officers earnings shall include up to 40 pay and longevity. Police Officers earnings shall include up to 40 hours of overtime per calendar year.hours of overtime per calendar year.

Years of service are accrued from your Police or Fire pension date of Years of service are accrued from your Police or Fire pension date of hire until you enter into the DROP or employment terminates. After hire until you enter into the DROP or employment terminates. After attaining membership in the Plan, service continues to accrue during attaining membership in the Plan, service continues to accrue during periods in the United States armed forces; vacation and authorized periods in the United States armed forces; vacation and authorized leaves of absence, providing member contributions have been paid. leaves of absence, providing member contributions have been paid.

Benefits are subject to any limitations set forth by the Internal Benefits are subject to any limitations set forth by the Internal Revenue Code for qualified pension plans. For members hired on or Revenue Code for qualified pension plans. For members hired on or after January 1, 1980, Florida Statutes stipulates normal retirement after January 1, 1980, Florida Statutes stipulates normal retirement benefits may not exceed 100% of final average earnings.benefits may not exceed 100% of final average earnings.

Effective January 1, 2000, a member has the option of various forms Effective January 1, 2000, a member has the option of various forms of retirement benefit payment. These optional benefit payments will of retirement benefit payment. These optional benefit payments will be in accordance with the option selected at the time of retirement. be in accordance with the option selected at the time of retirement.

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Benefit ComputationBenefit Computation

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Benefit ComputationBenefit Computation

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Death Benefits After RetirementDeath Benefits After Retirement Surviving Spouse and Eligible Children Surviving Spouse and Eligible Children

Standard BenefitStandard Benefit:: If you are married at time of death, If you are married at time of death, your spouse will receive 100% of your pension for your spouse will receive 100% of your pension for one year after your death and 60% of your pension one year after your death and 60% of your pension thereafter, until the earlier of death or remarriage.thereafter, until the earlier of death or remarriage.

In addition, each child under the age of 18 will In addition, each child under the age of 18 will receive 20% of your pension until marriage, death or receive 20% of your pension until marriage, death or age 18. The maximum payment to a surviving spouse age 18. The maximum payment to a surviving spouse and children is 100% of your pension. and children is 100% of your pension. 

If, upon the death of your spouse, there are no eligible If, upon the death of your spouse, there are no eligible children, and the amount of pension that has been children, and the amount of pension that has been paid does not equal the amount of money that you paid does not equal the amount of money that you yourself contributed to the Plan, the difference will be yourself contributed to the Plan, the difference will be paid to the contingent beneficiary you named or your paid to the contingent beneficiary you named or your estate.estate.

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Optional Forms of PaymentsOptional Forms of Payments 100% Joint & Survivor100% Joint & Survivor: This option provides a monthly payment : This option provides a monthly payment

to you as long as both you and your beneficiary are living. After the to you as long as both you and your beneficiary are living. After the death of death of either you or youreither you or your beneficiarybeneficiary, a monthly payment will , a monthly payment will continue for the life of the remaining person. continue for the life of the remaining person.

Life of MemberLife of Member: This option provides payments to you as long as : This option provides payments to you as long as you live. If you should die before you have received an amount you live. If you should die before you have received an amount equal to your contributions to the Plan, payments will continue to equal to your contributions to the Plan, payments will continue to your beneficiary until your contributions have been depleted.your beneficiary until your contributions have been depleted.

75%, 66-2/3 and 50% Joint & Survivor75%, 66-2/3 and 50% Joint & Survivor: This option provides a : This option provides a monthly payment to you as long as both you and your beneficiary monthly payment to you as long as both you and your beneficiary are living. After the death of are living. After the death of either you or your beneficiaryeither you or your beneficiary, a , a reduced reduced monthly will continue for the life of the remaining person. monthly will continue for the life of the remaining person.

*These options provide no additional benefit to dependent children. *These options provide no additional benefit to dependent children. The Joint & Survivor benefits are based on the beneficiary named The Joint & Survivor benefits are based on the beneficiary named and are payable and are payable onlyonly to this beneficiary. If you wish to change your to this beneficiary. If you wish to change your beneficiary at any time, your benefit will be recalculated for the new beneficiary at any time, your benefit will be recalculated for the new beneficiary chosen. beneficiary chosen.

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DROP RetirementDROP Retirement Police Officers and Firefighters are eligible to enter the Deferred Police Officers and Firefighters are eligible to enter the Deferred

Retirement Option Plan (DROP) upon attaining 20 years of service. Retirement Option Plan (DROP) upon attaining 20 years of service. This plan allows you to retire from the City of Fort Lauderdale for This plan allows you to retire from the City of Fort Lauderdale for pension purposes while allowing you to continue to work in your pension purposes while allowing you to continue to work in your current position for a period of up to current position for a period of up to eighteight years. All benefits that you years. All benefits that you are entitled to as an employee remain the same except for your are entitled to as an employee remain the same except for your pension.pension.

In order to enter the DROP plan, you must notify the Pension Office In order to enter the DROP plan, you must notify the Pension Office at least ninety (90) days prior to your desired entrance into the DROP at least ninety (90) days prior to your desired entrance into the DROP plan. Upon making the election to enter the DROP plan, your monthly plan. Upon making the election to enter the DROP plan, your monthly retirement benefit will be held for you by the System in a separate retirement benefit will be held for you by the System in a separate account until you terminate your employment with the City of Fort account until you terminate your employment with the City of Fort Lauderdale. Lauderdale.

Your DROP account will earn simple interest at the rate of 6% for the Your DROP account will earn simple interest at the rate of 6% for the first five (5) years of DROP. After the first five years, your DROP first five (5) years of DROP. After the first five years, your DROP account will receive the Net Rate of Investment Return of the plan, account will receive the Net Rate of Investment Return of the plan, but no less than 3% and no more than 6%. If you desire to terminate but no less than 3% and no more than 6%. If you desire to terminate the the DROP,DROP, you must notify the Pension Office 30 days prior to your you must notify the Pension Office 30 days prior to your desired date of termination. Minimum participation in the desired date of termination. Minimum participation in the DROPDROP Plan Plan shall be for a period of no less than two monthsshall be for a period of no less than two months. .

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DROP Participation PeriodDROP Participation Period

Years of Years of ServiceService

Maximum DROP Maximum DROP Participation Participation

20 – 2220 – 22 72 Months – (6 Years)72 Months – (6 Years)

22 – 2322 – 23 84 Months – (7 Years)84 Months – (7 Years)

23 – 23.9623 – 23.96 96 Months – (8 Years)96 Months – (8 Years)

Upon completion of the DROP you may have your account:(1) Paid to you (subject to IRS guidelines).(2) Rolled over to a qualified plan.(3) Remain in the plan until no later than age 59 ½.

If your DROP account remains in the plan, your account will receive the Net Investment Rate of Return of the Plan.

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NEW DROP 2010NEW DROP 2010 For those members of the DROP that made For those members of the DROP that made

an election to enter the New DROP the an election to enter the New DROP the following applies:following applies:

All deposits to the DROP made prior to August 1, 2010 All deposits to the DROP made prior to August 1, 2010 continue to receive 7 ¾ % interest through the end of your continue to receive 7 ¾ % interest through the end of your DROP period.DROP period.

All deposits made to the DROP after August 1, 2010 until All deposits made to the DROP after August 1, 2010 until the end of your sixtieth month will receive 6% interest.the end of your sixtieth month will receive 6% interest.

All deposits made from the sixtieth month through the end All deposits made from the sixtieth month through the end of your DROP will receive the Net Investment Return of the of your DROP will receive the Net Investment Return of the Plan but no less than 3% and no more than 6%. Plan but no less than 3% and no more than 6%.

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Bac-Drop RetirementBac-Drop Retirement

A member eligible for Normal Retirement may have a A member eligible for Normal Retirement may have a portion of his normal retirement benefit paid in a lump portion of his normal retirement benefit paid in a lump sum. Under the provisions of the sum. Under the provisions of the Benefit Actuarially Benefit Actuarially Calculated Deferred Retirement Option Program Calculated Deferred Retirement Option Program (BAC-DROP). (BAC-DROP). A member may receive a lump-sum A member may receive a lump-sum distribution of up to thirty-six (36) months of normal distribution of up to thirty-six (36) months of normal retirement benefits. The monthly retirement benefit retirement benefits. The monthly retirement benefit would then be actuarially reduced by the lump sum would then be actuarially reduced by the lump sum BAC-DROP distribution. BAC-DROP distribution.

You may elect a sixty (60) month BAC-DROP if an You may elect a sixty (60) month BAC-DROP if an election is made before October 1, 2011 with a election is made before October 1, 2011 with a termination date no later than October 1, 2012termination date no later than October 1, 2012

No member who elects the DROP Retirement is No member who elects the DROP Retirement is eligible to participate in the BAC-DROP.eligible to participate in the BAC-DROP.

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Firefighter 's Share PlanFirefighter 's Share Plan The Firefighters Share Plan is a separate provision of the Police & The Firefighters Share Plan is a separate provision of the Police &

Firefighters’ Retirement System. Effective January 1, 1998 the Firefighters’ Retirement System. Effective January 1, 1998 the Fort Lauderdale Firefighters implemented the provisions of Fort Lauderdale Firefighters implemented the provisions of Chapter 175, Florida Statues. The Share Plan provides additional Chapter 175, Florida Statues. The Share Plan provides additional retirement benefits to qualified recipients.retirement benefits to qualified recipients.

Under Florida Statues, the City will receive funds from the State to Under Florida Statues, the City will receive funds from the State to be allocated to individual accounts established in each participant’s be allocated to individual accounts established in each participant’s name. Your account will accumulate funds while you are name. Your account will accumulate funds while you are employed as a Firefighter. Share earnings are based on the Plan employed as a Firefighter. Share earnings are based on the Plan return, less expenses, applied on a quarterly basis. return, less expenses, applied on a quarterly basis.

Firefighters must complete ten (10) years of creditable service as a Firefighters must complete ten (10) years of creditable service as a Firefighter to receive a benefit from this plan. If employment Firefighter to receive a benefit from this plan. If employment terminates prior to ten years of service, the entire Share Plan terminates prior to ten years of service, the entire Share Plan balance will be forfeited.balance will be forfeited.

Benefits will be paid in a lump sum payment upon termination of Benefits will be paid in a lump sum payment upon termination of employment, disability, retirement or death. If you die before employment, disability, retirement or death. If you die before payment of your benefits, the entire amount of your account will payment of your benefits, the entire amount of your account will be paid to your beneficiary.be paid to your beneficiary.

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Death BenefitsDeath Benefits DEATH BENEFITS, SERVICE INCURREDDEATH BENEFITS, SERVICE INCURRED

If you die before retirement from causes related to your job, your spouse will receive a monthly payment until his/her death, equal to 50% of your earnings at the date of your death. An additional 10% will be paid for each child under the age of 18 to a maximum total payment of 80%. Your children will receive benefits until the earlier of age 18, marriage or death. If your spouse If you die before retirement from causes related to your job, your spouse will receive a monthly payment until his/her death, equal to 50% of your earnings at the date of your death. An additional 10% will be paid for each child under the age of 18 to a maximum total payment of 80%. Your children will receive benefits until the earlier of age 18, marriage or death. If your spouse were to remarry, theywere to remarry, they may be may be eligible to continue their benefit under certain circumstances. eligible to continue their benefit under certain circumstances.

If the member is not married, and has no minor children, the benefit will be paid to the named beneficiary for 96 months.If the member is not married, and has no minor children, the benefit will be paid to the named beneficiary for 96 months.

There may be additional benefits payable under Florida Statues and Federal Laws for Police Officers or Firefighters killed in the line of duty. These benefits are not included in this CityThere may be additional benefits payable under Florida Statues and Federal Laws for Police Officers or Firefighters killed in the line of duty. These benefits are not included in this City Plan. Plan.

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Non-Service Incurred DeathNon-Service Incurred Death If a member with at least ten (10) years of creditable service dies prior to retirement unrelated to your job, If a member with at least ten (10) years of creditable service dies prior to retirement unrelated to your job,

his or her beneficiary is entitled to the benefits otherwise payable at normal retirement.his or her beneficiary is entitled to the benefits otherwise payable at normal retirement.

Your beneficiary may elect to receive a monthly payment equal to 50% of your earnings at the date of Your beneficiary may elect to receive a monthly payment equal to 50% of your earnings at the date of death. The payments will be made for 96 months, or until the death of the beneficiaries you name. If the death. The payments will be made for 96 months, or until the death of the beneficiaries you name. If the last named beneficiary dies before 96 months have been paid, benefits shall be paid to your estate.last named beneficiary dies before 96 months have been paid, benefits shall be paid to your estate.

EXCLUSIONS FOR DISABILITY AND DEATHEXCLUSIONS FOR DISABILITY AND DEATH Disability benefits or death benefits will not be paid if the Pension Board determines that the following Disability benefits or death benefits will not be paid if the Pension Board determines that the following

conditions exist:conditions exist:

a) a) That disability or death resulted from an intentionally self-inflicted injury within the first two years of employment;That disability or death resulted from an intentionally self-inflicted injury within the first two years of employment;

b) That disability or death was the direct result of habitual, intentional use of alcohol, narcotics or drugs without an b) That disability or death was the direct result of habitual, intentional use of alcohol, narcotics or drugs without an intervening cause;intervening cause;

c) That disability or death resulted from unlawful participation or unlawful involvement in riots, insurrection or assembly;c) That disability or death resulted from unlawful participation or unlawful involvement in riots, insurrection or assembly;

d) That disability or death resulted from participation or involvement in the commission of a felony as defined by the laws d) That disability or death resulted from participation or involvement in the commission of a felony as defined by the laws of the State of Florida, or the United States of America; orof the State of Florida, or the United States of America; or

e) That disability or death resulted from or is an aggravation or recurrence of a pre-existing condition.e) That disability or death resulted from or is an aggravation or recurrence of a pre-existing condition.

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Please visit us at:Please visit us at:

www.ftlaudpfpension.comwww.ftlaudpfpension.com