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Home My WebLink AboutO-13090Vop City of Miami F .. 19611F A111 *'Ir Legislation i 0 R �O Ordinance: 13090 File Number: 09-00909 City Hall 3500 Pan American Drive Miami, FL 33133 www.miamigov.com Final Action Date: 9/24/2009 AN ORDINANCE OF THE MIAMI CITY COMMISSION AMENDING CHAPTER 40/ARTICLE IV/DIVISION 3, OF THE CODE OF THE CITY OF MIAMI, FLORIDA, AS AMENDED, ENTITLED "PERSONNEL/PENSION AND RETIREMENT PLAN/CITY OF MIAMI GENERAL EMPLOYEES' AND SANITATION EMPLOYEES' RETIREMENT TRUST," MORE PARTICULARLY BYAMENDING SECTIONS 40-244 AND 40-246, TO REFLECT CHANGE IN ACTUARIAL ASSET METHOD FROM THREE YEAR ASSET SMOOTHING TO FIVE YEAR ASSET SMOOTHING WITH PARTIAL PHASE IN; CHANGE FROM LEVEL DOLLAR TO LEVEL PERCENT OF PAY AMORTIZATION OF THE UNFUNDED ACTUARIAL ACCRUED LIABILITY; AND TO CLARIFY CHANGES IN ACTUARIAL METHODS AND ASSUMPTIONS, CONTAINING A SEVERABILITY CLAUSE AND PROVIDING FOR AN EFFECTIVE DATE. BE IT ORDAINED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: Section 1. Sections 40-244 and 40-246 of the Code of the City of Miami, Florida, as amended, is amended in the following particulars:{1} "Chapter 40 PERSONNEL ARTICLE IV. PENSION AND RETIREMENT PLAN DIVISION 3. CITY OF MIAMI GENERAL EMPLOYEES' AND SANITATION EMPLOYEES' RETIREMENT TRUST Sec. 40-244. Administration of the Plan; Liability; Misconduct of a co -trustee. (d) Actuarial valuation; actuarial standards. City of Miand Page 1 of 4 File Id. 09-00909 (Version: 2) Printed On: 6/28/2017 File Number: 09-00909 Enactment Number: 13090 (3) The actuarial value of the assets of the Plan shall be the three -five-year moving market value average. Each year, starting with the market value as of October 1, 4997 2007, be projeGted fopNard at the Valuation date based en the expected return will be determined based on the beginning of year market value and the actual contribution and benefit payments at the assumed interest assumption. This projected aGti iarial value is then eempared to the market value assets at the valuation date One third of the difference plus prier deferrals is added to the presented anti iarial asset value to equal the ,arts iarial asset value. Two thirds of the difference between the present -- v�ar ra ra ri -c� cr T c�vccvvccnzrrc-prvJccc anti iarial and market value is deferred to eanh of the next twe dears as future ire adjustment to the aGt6 iarial value. One-fifth of the difference between the expected market value return and the actual market value return is included in the actuarial asset value at the valuation date. Four-fifths of the difference between the expected market value return and the actual market value return is deferred in even increments of 20% per year to each of the next four years as future adjustments to the actuarial asset value. The preliminary actuarial asset value will be the sum of the actuarial asset value as of the previous valuation date plus the actual contributions and benefits payments in the year ending on the current valuation date plus the expected return on market value return plus one-fifth of the cumulative differences between the expected and actual market value returns over the five years up to the valuation date. The result cannot be greater than 120 percent of market value or less than 80 percent of market value. The board may approve other methods of determining the actuarial value of the Plan assets if such other methods are recommended by the actuary retained by the board and found by the Florida Bureau of Local Retirement Systems, Division of Retirement, Department of Administration, or its successor, to be in compliance with state law. Prior to the first meeting of the board to consider any change in the method of determining the actuarial value of Plan assets, the city shall be given timely written notice of the proposed change. Sec. 40-246 Contributions. (b) City contributions. (2) The city's contribution for the unfunded liability of the Plan shall be made in accordance with the final judgment, as amended, in the matter of Gates v. City of Miami, Case No. 77-9491, in the circuit court for the eleventh judicial circuit in and for Miami -Dade County, Florida, and in accordance with the following additional provisions: City of Miand Page 2 of 4 File Id. 09-00909 (Version: 2) Printed On: 6/28/2017 File Number: 09-00909 Enactment Number: 13090 a. As of October 1, 1997 2008, any a^t� iarial a^^n ied liability in ex^ess of market value of assets at that date shall ho amortized ever 30 arn.�rrarrc �-ac-vrc�.r.� .. shall � amortized years as a level dollar acne int the unfunded actuarial accrued liability shall be amortized as a level percentage of the projected payroll of active plan members. The unfunded actuarial accrued liability as of October 1, 2008 shall be amortized over the remaining years as of that date to fully amortize each unfunded actuarial accrued liability base. As of October 1, 1997 2008, benefit improvements for actives shall be amortized over 30-15 years. Benefit improvements for retirees shall be amortized over 15 years. Actuarial gains and losses shall be amortized over 15 years. Changes in actuarial assumptions and methods shall be amortized over 20 15 years. (3) The actuarial method for evaluating assets shall be changed to a moving market value average over three five years beginning September 30, 1997 2008. As of October 1, 1997 2008, market value one-year moving average shall be used; as of October 1, 1993 2009, a two-year moving average shall be used; as of October 1, 1999 2010, a three-year moving average shall be used, as of October 1, 2011, a four-year moving average shall be used, and thereafter, a -3- 5 year moving average shall be used. Each year the^+, iarial"a�i ie starting with the market value as of October 1, 1997 2007, will he nroie^ted forward-at- the orwardatthe valuation date based on the expected return will be determined based on the beginning of year market value and actual contributions and benefit payments at the assumed interest assumption. This nroie^ted anti iarial value is +hon w ed to the met value of assets at the valuation date One third of the differen^e plus prior deferrals is added to the projected anti iarial assetvalue to equal the anti iarial asset value. Twe thirds of the differen^e between nroie^ted a^tuarial and market ascot value is deferred to ea^h of the next two dears as future .re adi istment to the a^t, ,aria) asset value. One-fifth of the difference between the expected market value return and the actual market value return is included in the actuarial asset value at the valuation date. Four-fifths of the difference between the expected market value return and the actual market value return is deferred in even increments of 20% per year to each of the next four years as future adjustments to the actuarial asset value. The preliminary actuarial asset value will be the sum of the actuarial asset value as of the previous valuation date plus the actual contributions and benefit payments in the year ending on the current valuation date plus the expected return on market value return plus one-fifth of the cumulative differences between the expected and actual market value returns over the five vears City of Miand Page 3 of 4 File Id. 09-00909 (Version: 2) Printed On: 6/28/2017 File Number: 09-00909 Enactment Number: 13090 up to the valuation date. The result cannot be greater than 120 percent of market value or less than 80 percent of market value. (4) The anrc individual entry age normal cost method will be applied for costs as of October 1, 4998 2008, and each October 1 st thereafter, based on demographic and asset data as of the previous October 1 st adjusted for interest from that date to reflect payment timing. The annual normal cost will be determined on the individual entry age normal method. Th+s- medifiGato If the actuarial asset value exceeds the individual entry age accrued Iiability,such excess shall be held as a reserve to offset anv future unfunded actuarial accrued liability. wH]- aGtuarmal met .tee—Under no circumstances will the total cost be determined to be less than zero. *11 Section 2. If any section, part of section, paragraph, clause, phrase or word of this Ordinance is declared invalid, the remaining provisions of this Ordinance shall not be affected. Section 3. This Ordinance shall become effective immediately upon its adoption and signature of the Mayor.{2} Footnotes: {1} Words and/or figures stricken through shall be deleted. Underscored words and/or figures shall be added. The remaining provisions are now in effect and remain unchanged. Asterisks indicate omitted and unchanged material. {2} If the Mayor does not sign this Ordinance, it shall become effective at the end of ten calendar days from the date it was passed and adopted. If the Mayor vetoes this Ordinance, it shall become effective immediately upon override of the veto by the City Commission. City of Miami Page 4 of 4 File Id. 09-00909 (Version: 2) Printed On: 6/28/2017