HomeMy WebLinkAbout2010 08 10 Regular 600 Gabriel, Roeder, Smith & Company Actuarial ReportDate: August 10, 2010
The following Report was provided to the Board of
Trustees by Shawn Boyle, Director of Finance and
Administrative Services on behalf of Gabriel,
Roeder, Smith & Company at the August 10, 2010
Regular Meeting.
G-DC Gabriel Roeder Smith & Company
LJ Consultants & Actuaries
CITY OF WINTER SPRINGS
DEFINED BENEFIT PLAN
ACTUARIAL VALUATION AS OF OCTOBER 1, 2008
This Valuation Determines the Annual Contribution for the Plan Year October 1, 2008 through September 30, 2009 with
County and City contribution to be Paid in the Fiscal Year October 1, 2009 to September 30, 2010
August 9, 2010
Gabriel Roeder Smith & Company
City of Winter Springs
Defined Benefit Plan
TABLE OF CONTENTS
Pave
Commentary 1
I.
Summary of Retirement Plan Costs ................................................. ...............................
5
II.
Comparison of Cost Data of Current and Prior Valuations ............. ...............................
9
III.
Characteristics of Participants in Actuarial Valuation ................... ...............................
10
IV .
Statement of Assets ........................................................................ ...............................
11
V.
Reconciliation of Plan Assets ........................................................ ...............................
12
VI.
Reconciliation of Frozen Initial Liability Remaining Unfunded ... ...............................
14
VII.
Actuarial Gains (Losses) ................................................................ ...............................
15
VIII.
Amortization of Frozen Initial Liability ......................................... ...............................
16
IX.
Accounting Disclosure Exhibit ...................................................... ...............................
17
X.
Outline of Principal Provisions of the Retirement Plan ................. ...............................
21
XI.
Actuarial Assumptions and Actuarial Cost Methods Used ............ ...............................
24
XIL
Distribution of Plan Participants by Attained Age Groups and Service Groups ..........
33
XIII.
Statistics for Participants Entitled to Deferred Benefits and Participants
ReceivingBenefits ........................................................................ ...............................
37
XIV.
Reconciliation of Employee Data .................................................. ...............................
38
XV.
Projected Retirement Benefits ....................................................... ...............................
39
XVI.
Recent Plan Experience ................................................................. ...............................
40
XVII.
State Required Exhibit ................................................................... ...............................
42
Gabriel Roeder Smith & Company
RS Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1.616 phone
Consultants & Actuaries Suite 505 954.525.0083 fax
Ft. Lauderdale, FL 33301 -1804 www.gabrielroeder.com
August 9, 2010
Board of Trustees
c/o Mr. Shawn Boyle
Finance and Administrative Services Director
City of Winter Springs Defined Benefit Plan
1126 East State Road 434
Winter Springs, Florida 32708
Dear Board Members:
October 1, 2008 Actuarial Valuation
We are pleased to present our October 1, 2008 Actuarial Valuation for the City of Winter Springs Defined
Benefit Plan (Plan). The purpose of this report is to indicate appropriate contribution levels, comment on
the actuarial stability of the Plan and to satisfy State requirements. The Board of Trustees has retained
Gabriel, Roeder, Smith and Company (GRS) to prepare an annual actuarial valuation under Section 3.02 of
the Plan.
This report consists of this commentary, detailed Tables I through XVI and the State Required Exhibit on
Table XVII. The Tables contain basic Plan cost figures plus significant details on the benefits, liabilities
and experience of the Plan. We suggest you thoroughly review the report at your convenience and contact
us with any questions that may arise.
Retirement Plan Costs
Our Actuarial Valuation develops the required minimum Plan payment under the Florida Protection of
Public Employee Retirement Benefits Act. The minimum payment consists of payment of annual normal
costs including amortization of the components of the unfunded actuarial accrued liability over various
periods as prescribed by law. The minimum payment with County and City contribution to be paid in fiscal
year ending September 30, 2010 is $2,654,388 (24.7 %). The figure in parentheses is the Plan cost
expressed as a percentage of annual payroll ($10,767,596) as of October 1, 2008.
This total cost is to be met by member, County and City contributions. We anticipate member contributions
will be $323,028 (3.0 %). The resulting minimum required County and City contribution to be paid in
fiscal year ending September 30, 2010 is $2,331,360 (21.7 %).
Changes in Actuarial Assumptions, Methods and Plan Benefits
The benefit multiplier for service prior to October 1, 2000 is updated from 2.75% to 3.00 %. The remaining
Plan provisions are unchanged from the previous actuarial valuation. Plan provisions are summarized on
Table X.
Board of Trustees
August 9, 2010
Page 2
The actuarial assumptions and methods are updated effective October 1, 2008.
The mortality assumption for healthy General Employee lives is updated:
• FROM - the rates from the 1983 Group Annuity Mortality Table for males, with females set back two
(2) years
• TO - the rates from the RP -2000 Combined Mortality Table, with separate rates for males and females
and with fully generational mortality improvements projected to each future decrement date.
The mortality assumption for healthy Firefighter and Police Officer lives is updated:
• FROM - the rates from the 1983 Group Annuity Mortality Table for males, with females set back two
(2) years
• TO - the rates from the RP -2000 Combined Mortality Table with Blue Collar Adjustment, with separate
rates for males and females and with fully generational mortality improvements projected to each future
decrement date.
The mortality assumption for disabled members is updated:
• FROM - the rates from the 1983 Group Annuity Mortality Table for males, with females set back two
(2) years
• TO - the rates from the RP -2000 Combined Disabled Mortality Table with separate rates for males and
females and with fully generational mortality improvements projected to each future decrement date.
Interest on participant contributions is updated:
• FROM - the 120% Federal Midterm rate from the September preceding the valuation date
• TO - 3.75 %, compounded annually.
Expected administrative expenses are included in Normal Cost.
The 1.5% expense load to make allowance for 30 year unreduced benefit provision with LTD disability
program was removed. Plan liabilities for the disability benefit are actuarially determined.
Assumed retirement rates, disability rates, withdrawal rates and salary increase rates are updated as outlined
in Table XI.
The Actuarial Funding Method is changed from the Frozen Initial Liability Funding Method to the Entry
Age Normal Funding Method.
The remaining actuarial assumptions and methods are unchanged from the previous actuarial valuation.
The actuarial assumptions and methods are outlined on Table XI.
Comparison of October 1, 2007 and October 1, 2008 Valuation Results
Table II of our report provides information of a comparative nature. The left columns of the Table indicate
the costs as calculated by the prior actuary for October 1, 2007. The center columns indicate the costs as
calculated for October 1, 2008 prior to the changes in plan provision, actuarial assumptions and methods.
Gabriel Roeder Smith & Company
Board of Trustees
August 9, 2010
Page 3
The right columns indicate the costs as calculated for October 1, 2008 after reflecting the changes in plan
provisions, actuarial assumptions and methods.
Comparing the left and center columns of Table II shows the effect of Plan experience during the year. The
number of active participants decreased by approximately 11% while covered payroll decreased by
approximately 4 %. Total normal cost increased both as a dollar amount and as a percentage of payroll.
The frozen initial liability remaining unfunded decreased as a dollar amount but increased as a percentage
of covered payroll. The net County and City minimum funding requirement increased both as a dollar
amount and as a percentage of covered payroll.
Comparing the center and right columns of Table II shows the effect of the change in plan provisions,
actuarial assumptions and methods. The net County and City minimum funding requirement increased both
as a dollar amount and as a percentage of covered payroll.
The value of vested accrued benefits exceeds Plan assets, resulting in a Vested Benefit Security Ratio
(VBSR) of 64.6% (69.6% prior to change in plan provisions, actuarial assumptions and methods) which is a
decrease from 100.3% as of the October 1, 2007 Actuarial Valuation. The VBSR is measured on a market
value basis.
Plan Experience
The Plan experienced an actuarial loss in the amount of $3,116,104 this year. This indicates net Plan
experience was less favorable than expected based upon the prior actuarial assumptions.
Table XVI (salary, turnover and investment yield) provides figures on recent Plan experience. Salary
experience indicates actual salary increases averaged approximately 3.9% for General Employees and 5.6%
for Firefighters and Police Officers for the Plan Year ended September 30, 2008. The prior salary increase
assumption was 3.0 %. Salary experience was generally a source of actuarial loss.
Employee turnover this year was 120% of the prior assumed turnover for General Employees and 310% of
the prior assumed turnover for Firefighters and Police Officers. Employee turnover was generally an
offsetting source of actuarial gain.
The actuarial value investment return of 10.1 % was greater than the investment return assumption of 8.0 %.
Investment return was an offsetting source of actuarial gain during the year. The three and five year
average annual actuarial value investment returns are 11.6% and 7.8 %, respectively. The one, three and
five year average annual market value returns are - 16.8 %, 0.9% and 5.2 %, respectively.
Member Census and Financial Data
The City submitted the Member census data used for this actuarial valuation to us. This information
contains name, Social Security number, date of birth, date of hire, October 1, 2008 rate of pay, actual salary
paid and member contributions for the previous year. Dates of termination and retirement are provided
Gabriel Roeder Smith & Company
Board of Trustees
August 9, 2010
Page 4
where applicable. The Board updated information on inactive participants including retirees, beneficiaries
and vested terminees.
We used financial information concerning Plan assets from the City's Comprehensive Annual Financial
Report (CAFR). We do not audit the Member census data and asset information that is provided to us.
However, we perform certain reasonableness checks and on this basis we believe that the information that
we received is reliable.
Summary
In our opinion the benefits provided for under the current Plan will be sufficiently funded through the
payment of the amount as indicated in this and future Actuarial Valuation reports. We will continue to
update you on the future payment requirements for the Plan through our actuarial reports. These reports
will also continue to monitor the future experience of the Plan.
The undersigned are Members of the American Academy of Actuaries and meet the qualification standards
of the American Academy of Actuaries to render the actuarial opinions contained in this report. We are
available to respond to any questions with regards to matters covered in this report.
Very truly yours,
C"�, L�
Lawrence F. Wilson, A.S.A. Peter N. Strong, A.S.A.
Senior Consultant and Actuary Consultant and Actuary
Gabriel Roeder Smith & Company
Table I
City of Winter Springs
Defined Benefit Plan
Summary of Retirement Plan Costs as of October 1, 2008 - Current Method
Current Plan /
Current Assumptions
Cost "4, of
Data Payroll
A. Participant Data Summary (Table III)
1. Active Employees 231 N/A
2. Terminated Vested 84 N/A
3. Receiving Benefits (including DROPs) 31 N/A
4. Total Annual Payroll of Active Employees $ 10,767,596 100.0%
B. Total Normal Costs
1.
Age Retirement Benefits
$ 1,074,410
10.0%
2.
Termination Benefits
197,835
1.8%
3.
Death Benefits
33,492
0.3%
4.
Disability Benefits
11,202
0.1%
5.
Estimated Expenses
70,423
0.7%
6.
Total Annual Normal Costs
$ 1,387,362
12.9%
C. Total Actuarial Accrued Liability
1.
Age Retirement Benefits Active Employees
$ 22,694,709
210.8%
2.
Termination Benefits Active Employees
1,200,311
11.1%
3.
Death Benefits Active Employees
704,371
6.5%
4.
Disability Benefits Active Employees
233,792
2.2%
5.
Retired or Terminated Vested Participants
Receiving Benefits (including DROPs)
3,966,840
36.8%
6.
Terminated Vested Participants Entitled to
Future Benefits
2,179,784
20.2%
7.
Deceased Participants Whose Beneficiaries
are Receiving Benefits
1,416,587
13.2%
8.
Disabled Participants Receiving Benefits
0
0.0%
9.
Miscellaneous Liability (Refunds in Process)
17,861
0.2%
10.
Total Actuarial Accrued Liability
$ 32,414,255
301.0%
D. Assets (Table V)
1. Actuarial Value of Assets $ 18,746,975 174.1%
2. Market Value of Assets $ 15,622,479 145.1%
E. Unfunded Actuarial Accrued Liability
(C. - D.1.) $ 13,667,280 126.9%
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Gabriel Roeder Smith & Company
Table I
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Summary of Retirement Plan Costs as of October 1, 2008 - Current Method
Current Plan /
Current Assumptions
Cost 'Vo of
Data Payroll
F. Minimum Required Contribution
1. Total Normal Cost (including expenses) $ 1,387,362 12.9%
2. Amortization of Unfunded Liability 1,147,129 10.7%
3. Interest Adjustment 119,897 1.1%
4. Total Payment $ 2,654,388 24.7%
G. Contribution Sources
1. County and City
$
2,331,360
21.7%
2. Member
$
323,028
3.0%
H. Actuarial Gains (Losses)
$
(3,116,104)
(28.9 %)
L Actuarial Present Value of Vested Accrued Benefits
1. Retired, Terminated Vested, Beneficiaries
and Disabled Receiving Benefits (including DROPs)
$
5,383,427
50.0%
2. Terminated Vested Participants Entitled to
Future Benefits and Miscellaneous
2,197,645
20.4%
3. Active Participants Entitled to Future Benefits
16,591,829
154.1%
4. Total Actuarial Present Value of Vested
Accrued Benefits
$
24,172,901
224.5%
J. Unfunded Actuarial Present Value of Vested
Accrued Benefits (I. - D.2., not less than zero)
$
8,550,422
79.4%
K. Vested Benefit Security Ratio (D.2. - L)
64.6%
N/A
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Gabriel Roeder smith & Company
Table I
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Summary of Retirement Plan Costs as of October 1, 2008 - Prior Method
Prior Plan / Current Plan /
Prior Assumptions Current Assumptions
Cost % of Cost % of
Data Payroll Data Payroll
A. Participant Data Summary (Table III)
1. Active Employees 231
2. Terminated Vested 84
3. Receiving Benefits (including DROPs) 31
4. Total Annual Payroll of Active Employees $ 10,767,596
B. Total Actuarial Present Value of Future Benefits
$ 31,544,607
1.
Age Retirement Benefits Active Employees
$ 22,013,299
2.
Termination Benefits Active Employees
5,297,022
3.
Death Benefits Active Employees
1,051,680
4.
Disability Benefits Active Employees
0
5.
Retired or Terminated Vested Participants
Receiving Benefits (including DROPs)
3,793,327
6.
Terminated Vested Participants Entitled to
Future Benefits
1,998,879
7.
Deceased Participants Whose Beneficiaries
are Receiving Benefits
1,366,079
8.
Disabled Participants Receiving Benefits
0
9.
Miscellaneous Liability (Refunds in Process)
17,861
10.
Total Present Value of Future Benefits
$ 35,538,147
C. Assets (Table V)
1. Actuarial Value of Assets
2. Market Value of Assets
D. Frozen Initial Liability Remaining Unfunded
E. Actuarial Present Value of Future
Total Normal Cost (B. - C.1. - D.)
$ 18,746,975
$ 15,622,479
$ 4,422,490
N/A 231
N/A 84
N/A 31
100.0% $ 10,767,596
204.4%
$ 31,544,607
49.2%
2,960,589
9.8%
973,478
0.0%
341,696
35.2% 3,966,840
18.6% 2,179,784
12.7% 1,416,587
0.0% 0
0.2% 17,861
330.0% $ 43,401,442
174.1% $ 18,746,975
145.1% $ 15,622,479
N/A
N/A
N/A
100.0%
293.0%
27.5%
9.0%
3.2%
36.8%
20.2%
13.2%
0.0%
0.2%
403.1%
174.1%
145.1%
67.6%
41.1% $ 7,280,100
$ 12,368,682 114.9% $ 17,374,367
F. Actuarial Present Value of Future Salaries $ 71,634,579 665.3% $ 93,841,493
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Gabriel Roeder Smith & Company
161.4%
871.5%
Table I
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Summary of Retirement Plan Costs as of October 1, 2008 - Prior Method
G. Normal Cost Accrual Rate (E. / F.)
Prior Plan / Current Plan /
Prior Assumptions Current Assumptions
% of % of
Cost Base Cost Base
Data Payroll Data Payroll
17.27% N/A 18.51% N/A
H.
Administrative Expenses
$
0
0.0%
$
70,423
0.7%
L
Normal Cost (A.4. x G. + H., but not less than 0)
$
1,859,564
17.3%
$
2,063,505
19.2%
J. Minimum Required Contribution
1. Normal Cost
$ 1,859,564
17.3%
$
2,063,505
19.2%
2. Amortization of Frozen Initial Liability
Remaining Unfunded
386,767
3.6%
621,799
5.8%
3. Interest Adjustment
105,909
1.0%
127,218
1.2%
4. Total Payment
$ 2,352,240
21.8%
$
2,812,522
26.1%
K. Contribution Sources
1. County and City
$ 2,029,212
18.8%
$
2,489,494
23.1%
2. Member
$ 323,028
3.0%
$
323,028
3.0%
L. Actuarial Present Value of Vested Accrued Benefits
1. Retired, Terminated Vested, Beneficiaries
and Disabled Receiving Benefits (including
DROPS)
$ 5,159,406
47.9%
$
5,383,427
50.0%
2. Terminated Vested Participants Entitled to
Future Benefits and Miscellaneous
2,016,740
18.7%
2,197,645
20.4%
3. Active Participants Entitled to Future Benefits
15,265,560
141.8%
16,591,829
154.1%
4. Total Actuarial Present Value of Vested
Accrued Benefits
$ 22,441,706
208.4%
$
24,172,901
224.5%
M. Unfunded Actuarial Present Value of Vested
Accrued Benefits (L. - C.2., not less than zero)
$ 6,819,227
63.3%
$
8,550,422
79.4%
N. Vested Benefit Security Ratio (C.2. - L.)
69.6%
N/A
64.6%
N/A
-8-
Gabriel Roeder Smith & Company
Table II
City of Winter Springs
Defined Benefit Plan
Comparison of Cost Data of October 1, 2007 and October 1, 2008 Valuations
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Gabriel Roeder Smith & Company
Prior Method / Prior Plan /
Current Method / Current Plan /
Prior Assumptions
Current Assumptions
October 1, 2007
October 1, 2008
October 1, 2008
Cost
% of
Cost
% of
Cost
% of
Data
Compensation
Data
Compensation
Data
Compensation
A.
Participants
1. Active Employees
259
N/A
231
N/A
231
N/A
2. Terminated Vested
86
N/A
84
N/A
84
N/A
3. Receiving Benefits
26
N/A
31
N/A
31
N/A
4. Total Annual Payroll of Active Employees
$ 11,190,013
100.0%
$
10,767,596
100.0%
$
10,767,596
100.0%
B.
Total Normal Costs
$ 1,445,568
12.9%
$
1,859,564
17.3%
$
1,387,362
12.9%
C.
Actuarial Accrued Liability*
$ 20,113,926
179.7%
$
29,556,645
274.5%
$
32,414,255
301.0%
(Entry Age Normal)
D.
Present Value of Future Benefits
$ 29,526,958
263.9%
$
35,538,147
330.0%
$
43,401,442
403.1%
E.
Actuarial Value of Assets
$ 15,526,572
138.8%
$
18,746,975
174.1%
$
18,746,975
174.1%
F.
Market Value of Assets
$ 16,985,582
151.8%
$
15,622,479
145.1%
$
15,622,479
145.1%
G.
Frozen Initial Liability Remaining Unfunded
$ 4,587,354
41.0%
$
4,422,490
41.1%
N/A
N/A
H.
Unfunded Actuarial Accrued Liability (EAN)
N/A
N/A
N/A
N/A
$
13,667,280
126.9%
L
County and City Minimum Funding Payment
$ 1,669,400
14.9%
$
2,029,212
18.8%
$
2,331,360
21.7%
J.
Vested Benefit Security Ratio
100.3%
N/A
69.6%
N/A
64.6%
N/A
* Frozen Initial Liability as of October 1, 2007
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Gabriel Roeder Smith & Company
Table III
City of Winter Springs
Defined Benefit Plan
Characteristics of Participants in
Actuarial Valuation as of October 1, 2008
A. Active Plan Participants Summary
1. Active participants fully vested
2. Active participants partially vested
3. Active participants non - vested
4. Total active participants
5. Annual rate of pay of active participants
B. Retired and Terminated Vested Participant Summary
1. Retired or terminated vested participants receiving
benefits (including DROPs)
2. Terminated vested participants entitled to
future benefits
3. Deceased participants whose beneficiaries are
receiving benefits
4. Disabled participants receiving benefits
C. Projected Annual Retirement Benefits
128
63
40
231
$ 10,767,596
24
7
0
1. Retired or terminated vested receiving benefits (including DROPS) $ 376,525
2. Terminated vested entitled to future benefits $ 611,456
3. Beneficiaries of deceased participants $ 127,919
4. Disabled participants $ 0
Gabriel Roeder Smith & Company
Table IV
City of Winter Springs
Defined Benefit Plan
Statement of Assets as of October 1, 2008
Assets Market Value
A. Cash and Cash Equivalents $ 675,224
B. General Investments
1. Common Stocks $ 9,701,005
2. Bonds 5,164,518
C. Receivables
1. Accrued Interest $ 0
2. Member Contributions Receivable 81,732
3. Accounts Receivable 0
D. Payables
1. Accounts Payable $ 0
2. Due to Broker 0
E. Plan Assets
(A + B + C - D.) $ 15,622,479
-1 1-
Gabriel Roeder smith & Company
Table V
City of Winter Springs
Defined Benefit Plan
Reconciliation of Plan Assets
A. Preliminary Market Value of Assets as of October 1, 2007
Adjustment to Market Value of Assets as of October 1, 2007
Total Market Value of Assets as of October 1, 2007
B. Receipts During Period
1. Contributions
a. Member $ 365,288
b. City 1,663,951
c. Total $ 2,029,239
$ 16,985,582
61,578
$ 17,047,160
2. Investment Income
a. Interest and dividends $ 255,946
b. Net realized and unrealized gains (3,254,961)
c. Net investment income $ (2,999,015)
3. Total receipts during period $ (969,776)
C. Disbursements During Period
1. Pension payments $ 384,482
2. Contribution refunds 0
3. Administrative expenses 70,423
4. Total disbursements during period $ 454,905
D. Total Market Value of Net Assets as of September 30, 2008
$ 15,622,479
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Gabriel Roeder Smith & Company
Table V
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Development of Actuarial Value of Assets as of September 30
A. Preliminary total actuarial value from prior year
B. Market value beginning of year
C. Market value end of year
D. Non - investment net cash flow
E. Investment return
1. Total market value return: C. - B. - D.
2. Amount for immediate recognition (8 %)
3. Amount for phased -in recognition: E.1. - E.2.
2008 2009 2010 2011
$ 15,526,572 $ 18,759,317
17,047,160 *` 15,622,479
15,622,479
1,574,334
2012
F. Phased -in recognition of investment return:
1. Current year: 20% of E.3.
2. First prior year
3. Second prior year
4. Third prior year
5. Fourth prior year
6. Total phased -in recognition of investment return
G. Total actuarial value end of year
1. Preliminary total actuarial value end of year:
A. + D. + E.2. + F.S.
2. Upper corridor limit: 120% of C.
3. Lower corridor limit: 80% of C.
4. Total actuarial value end of year:
G.1., not more than G.2., nor less than G.3.
H. Difference between total market value and total actuarial value
L Actuarial value rate of return
J. Market value rate of return
* Adjusted Market Value as of October 1, 2008
(2,999,015)
1,426,746
(4,425,761)
(885,152)
480,905
(885,152)
346,980
480,905
(885,152)
241,333
346,980
480,905 (885,152)
47,599
241,334
346,984 480,907 (885,153)
231,665
184,067
(57,263) (404,245) (885,153)
18,759,317
18,746,975
12,497,983
18,746,975
(3,124,496)
10.09%
(16.82 %)
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Gabriel Roeder Smith & Company
Table VI
City of Winter Springs
Defined Benefit Plan
Frozen Initial Liability Remaining Unfunded
as of September 30, 2008
A. Derivation of Frozen Initial Liability Remainin, Unfunded
1. Employer normal cost previous valuation $ 1,109,868
2. Frozen initial liability remaining unfunded previous valuation $ 4,587,354
3. City Contributions previous year: $ 1 663 951
4. Interest on
(a) Employer normal cost $ 88,789
(b) Frozen initial liability remaining unfunded 366,988
(c) Contributions 66,558
(d) Net total: (a) + (b) - (c) $ 389,219
5. Increase due to Plan amendment and update in actuarial assumptions $ 2,857,610
6. Frozen initial liability remaining unfunded current year:
(1. +2.- 3. +4. +5.) $ 7,280,100
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Gabriel Roeder Smith & Company
Table VII
City of Winter Springs
Defined Benefit Plan
Actuarial Gains (Losses)
as of September 30, 2008
A. Derivation of Actuarial Gains (Losses
1. Normal cost for benefits as a percentage of payroll
a. Last valuation
b. Current valuation (prior plan / assumptions)
c. Difference (a. - b )
2. Actuarial present value of projected payroll
(prior assumptions)
3. Gain / (loss) due to investment return
a. Expected actuarial value of assets
b. Actual actuarial value of assets
c. Gain (Loss): b. -a.
d. Gain (Loss) as % of projected payroll: c. / 2.
4. Net actuarial gain (loss)
a. From investment return: 3.c.
b. From liabilities: l.c. x 2. - 3.c.
c. Total
B. Historic Gains (Losses)
Year Ended
Actuarial Gain (Loss)
09/30/2008 $ (3,116,104)
12.92%
17.27%
(4.35 %)
$ 71,634,579
$ 18,406,005
18,746,975
$ 340,970
0.48%
$ 340,970
(3,457,074)
$ (3,116,104)
-15-
Gabriel Roeder Smith & Company
Table VIII
City of Winter Springs
Defined Benefit Plan
Amortization of Unfunded Actuarial Accrued Liability
A. Unfunded Actuarial Accrued Liabili
B. Covered Payroll History*
Unfunded
Amortization
Date
Liability
Increase
Payment
$
October 1, 2008
$
13,667,280
$
1,147,129
October 1, 2009
$
13,521,763
$
1,147,129
October 1, 2010
$
13,364,605
$
1,147,129
October 1, 2011
$
13,194,874
$
1,147,129
October 1, 2012
$
13,011,565
$
1,147,129
October 1, 2038
$
0
$
0
B. Covered Payroll History*
* Information prior to October 1, 2008 as reported by prior actuaiy.
-16-
Gabriel Roeder Smith & Company
Covered
Annual
Date
Payroll
Increase
October 1, 2008
$
10,767,596
(3.8 %)
October 1, 2007
$
11,190,013
6.7%
October 1, 2006
$
10,489,087
8.6%
October 1, 2005
$
9,659,446
7.5%
October 1, 2004
$
8,982,189
11.0%
October 1, 2003
$
8,094,829
22.9%
October 1, 2002
$
6,586,077
0.3%
October 1, 2001
$
6,569,263
N/A
Seven Year Average Annual Increase
7.3%
* Information prior to October 1, 2008 as reported by prior actuaiy.
-16-
Gabriel Roeder Smith & Company
City of Winter Springs
Defined Benefit Plan
Accounting Disclosure Exhibit
I. Number of Plan Members
a. Retirees and beneficiaries receiving benefits
b. Terminated plan members entitled to but not yet receiving benefits
c. Active plan members
d. Total
IL Financial Accounting Standards Board Allocation as of October 1, 2008
A. Statement of Accumulated Plan Benefits
1. Actuarial present value of accumulated vested plan benefits
a. Participants currently receiving benefits
b. Other participants
c. Total
2. Actuarial present value of accumulated
non - vested plan benefits
3. Total actuarial present value of accumulated plan benefits
B. Statement of Change in Accumulated Plan Benefits
I. Actuarial present value of accumulated plan benefits
as of October 1, 2007
2. Increase (decrease) during year attributable to:
a. Plan amendment
b. Change in actuarial assumptions
c. Benefits paid including refunds
d. Other, including benefits accumulated, increase
for interest due to decrease in the discount period
e. Net increase
3. Actuarial present value of accumulated plan benefits
as of October 1, 2008
Prior Plan /
Prior
Assumptions
10/01/2008
Table IX
Current Plan /
Current
Assumptions
10/01/2008
26
31
31
86
84
84
259
231
231
371
346
346
$ 3,962,082 $ 5,159,406 $ 5,383,427
12,974,450 17,282,300 18,789,474
$ 16,936,532 $ 22,441,706 $ 24,172,901
$ 503,752 $ 531,943 $ 525,243
$ 17,440,284 $ 22,973,649 $ 24,698,144
C. Significant Matters Affecting Calculations
1. Assumed rate of return used in determining actuarial present values
2. Change in plan provisions
3. Change in actuarial assumptions
* Adjusted based on information reported by prior actuary.
-17-
10/01/2007*
$ 17,440,284
$ 675,812
1,048,683
(384,482)
5,917,847
$ 7,257,860
$ 24,698,144
8%
See Table X. Item M.
See Table XI. Item L.
Gabriel Roeder Smith & Company
Table IX
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Accounting Disclosure Exhibit
III. Annual Pension Cost For the Current Year and Related Information
Contribution rates:
City
Members
Actuarial valuation date
Annual pension cost
Contributions made
Actuarial cost method
Amortization method
Remaining amortization period
TBD
3.0%
October 1, 2008
TBD
$ 1,781,197
Entry Age Normal
Level percent, closed
30 years
Asset valuation method 5 year smoothed market
Actuarial assumptions:
Investment rate of return * 8.0%
Projected salary increases * 3.0% - 7.5%
* Includes expected inflation at 3.0%
-18-
Gabriel Roeder Smith & Company
Table IX
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Accounting Disclosure Exhibit
IV. Historical Trend Information
A. Schedule of Employer Costs (GASB No. 25
Fiscal Year
Annual Required
Percentage of
Ended
Contribution (ARC)
ARC Contributed
09/30/2003
$ 761,269
119%
09/30/2004
$ 1,156,923
88%
09/30/2005
$ 1,424,101
89%
09/30/2006
$
1,564,228
96%
09/30/2007
$
1,807,722
102%
09/30/2008
$
2,005,100
100%
B. Schedule of Employer Costs GASB No. 27)
Fiscal Year
Annual
Pension
Percentage of
Ended
Cost (APC)
APC Contributed
09/30/2003
$
749,959
121%
09/30/2004
$
1,133,309
89%
09/30/2005
$
1,410,081
89%
09/30/2006
$
1,562,165
96%
09/30/2007
$
1,810,230
102%
09/30/2008
$
2,004,975
100%
V. Annual Pension Cost and Net Pension Asset
Fiscal Year Ended
9/30/2008*
Annual Required Contribution (ARC)
$
2,005,100
Interest on Net Pension Asset (NPA)
(125)
Adjustment to ARC
0
APC
$
2,004,975
City Contributions
$
(2,009,085)
(Increase) Decrease in NPA
$
(4,110)
NPA (beginning of year)
(1,563)
NPA (end of year)
$
(5,673)
* As reported in Comprehensive Annual Financial Report (CAFR)
-19-
Net Pension
Oblivation /(Asset
$ (295,176)
$ (175,246)
$ (25,791)
$ 31,354
$ (1,563)
$ (5,673)
9/30/2010
$ 2,331,360
TBD
TBD
I NJ W
Gabriel Roeder Smith & Company
Table IX
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Schedule of Funding Progress
(Dollar Amounts in Thousands)
VI. Schedule of Funding Progress*
* Information prior to October 1, 2008 as reported by prior actuary
Frozen Initial Liability prior to change in method as of October 1, 2008
1 Prior Plan / Prior Assumptions / Prior Method
2 Current Plan / Current Assumptions / Current Method
-20-
Gabriel Roeder Smith & Company
Actuarial Accrued
Unfunded
UAAL as a
Actuarial
Liability (EAN +)
AAL
Funded
Percentage of
Actuarial
Value of Assets
(AAL)
(UAAL)
Ratio
Payroll
Payroll
Valuation Date
(a)
(b)
(b - a)
(a /b)
(c)
((b -a) /c)
10/01/2003
$
7,279
$
9,772
$
2,493
74.5%
$
8,095
30.8%
10/01/2004
$
8,135
$
10,932
$
2,797
74.4%
$
8,982
31.1%
10/01/2005
$
9,716
$
13,178
$
3,462
73.7%
$
9,659
35.8%
10/01/2006
$
11,951
$
16,043
$
4,092
74.5%
$
10,489
39.0%
10/01/2007
$
15,527
$
20,114
$
4,587
77.2%
$
11,190
41.0%
10/1/2008
$
18,747
$
23,169
$
4,422
80.9%
$
10,768
41.1%
10/1/2008
$
18,747
$
32,414
$
13,667
57.8%
$
10,768
126.9%
* Information prior to October 1, 2008 as reported by prior actuary
Frozen Initial Liability prior to change in method as of October 1, 2008
1 Prior Plan / Prior Assumptions / Prior Method
2 Current Plan / Current Assumptions / Current Method
-20-
Gabriel Roeder Smith & Company
Table X
City of Winter Springs
Defined Benefit Plan
Outline of Principal Provisions of the Retirement Plan
A. Effective Date:
Plan adopted as a Money Purchase Floor Offset plan on October 1, 1997. Plan amended and
restated as a Defined Benefit Plan effective October 1, 2000. Plan most recently amended by
Resolution 2007 -20 effective April 23, 2007.
B. Eligibility Requirements:
Employees working 30 or more hours per week are eligible to join the Plan on the first day of the
month following completion of six (6) months of service.
C. Accrual Service:
Years of Accrual Service are any Plan Year during which an Employee completes at least 1,000
hours of service, including years of service completed prior to participation in the Plan.
D. Final Average Compensation
Average earnings during the three (3) highest consecutive compensation periods during
employment with the City.
E. Normal Retirement:
1. Eligibility:
(a) Attainment of age 65; or
(b) Completion of 30 years of service and determined to be disabled under the City's long term
disability insurance policy.
2. Benefit:
3.00% times Final Average Compensation multiplied by Accrual Service, up to a maximum of
30 years.
-21-
Gabriel Roeder Smith & Company
Table X
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Outline of Principal Provisions of the Retirement Plan
F. Early Retirement:
1. Eli ig bility:
(a) Attainment of age 55 and completion of ten (10) years of service; or
(b) Completion of 25 years of service.
2. Benefit:
Benefit accrued to date of early retirement, actuarially reduced for each year early retirement
benefit commencement precedes age 55.
G. Late Retirement:
1. Eligibility
Continued employment beyond Normal Retirement Date.
2. Benefit:
Greater of (a) and (b):
(a) Accrued benefit calculated as for Normal Retirement based upon service and pay at Late
Retirement Date.
(b) Actuarially increased benefit as of Late Retirement Date.
H. Disabilitv Retirement:
1. Eligibility
Completion of 30 years of service and determined to be disabled under the City's long term
disability insurance policy.
2. Benefit:
3.00% times Final Average Compensation multiplied by Accrual Service.
L Death Benefit:
Beneficiary entitled to a monthly benefit supported by the present value of the non - forfeitable
accrued benefit at the time of the participant's death. If death occurs after actual retirement, the
beneficiary receives whatever is payable under the form of benefit option elected.
-22-
Gabriel Roeder Smith & Company
Table X
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Outline of Principal Provisions of the Retirement Plan
J. Participant Contributions:
Three percent (3 %) of compensation.
K. Vested Benefit Upon Termination:
100% vested in required participant contributions. Participant contributions made after October 1,
2000 are included in the deferred vested benefit payable at normal or early retirement date.
Upon termination of service prior to normal or early retirement date a participant shall be entitled
to a benefit payable at normal or early retirement date calculated as for normal retirement. Based
on pay and service at date of termination multiplied by a percentage from the following table.
Years of Service Vested Percentage
Less Than 3 0%
3 20%
4 40%
5 60%
6 80%
7 100%
L. Normal Form of Pavment of Retirement Income:
Monthly benefit payable for life.
Other Options:
Actuarially equivalent joint and survivor at 50 %, 75 %, 100 %; or ten (10) years certain and life.
M. Changes Since Previous Valuation
Normal retirement benefit was the sum of (a) and (b) but for years not more than (c) below:
(a) 2.75% times Average Compensation multiplied by credited service prior to October 1, 2000.
(b) 3.00% times Average Compensation multiplied by credited service after October 1, 2000.
(c) The maximum number of years of credited service for determining benefits is the first 30
years.
-23-
Gabriel Roeder Smith & Company
Table XI
City of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
A. Mortality
For healthy General Employee participants, the RP -2000 Combined Mortality Table was used with
separate rates for males and females and frilly generational mortality improvements projected to each
future decrement date.
For healthy Firefighter and Police Officer participants, the RP -2000 Combined Mortality Table with
Blue Collar Adjustment was used with separate rates for males and females and fully generational
mortality improvements projected to each future decrement date.
For disabled participants, the RP -2000 Combined Disabled Mortality Table was used with separate rates
for males and females and fully generational mortality improvements projected to each future decrement
date.
B. Investment Return
8.0 %, compounded annually, net of investment expenses.
C. Allowances for Expenses or Contingencies
Prior year's actual administrative expenses are included in Normal Cost.
D. Salary Increase Factors
Current salary is assumed to increase at a rate based on the table below per year until retirement.
-24-
Gabriel Roeder Smith & Company
General
Firefighters and
Service
Employees
Police Officers
Less than 5 years
6.5%
7.5%
5 - 9 years
5.5%
5.5%
10 - 14 years
4.5%
5.5%
15+ years
3.0%
3.5%
-24-
Gabriel Roeder Smith & Company
Table XI
(Cont'd)
Cite of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
E. Employee Withdrawal Rates
1. Withdrawal rates for male General Employees were used in accordance with the following illustrative example:
2. Withdrawal rates for female General Employees were used in accordance with the following illustrative example:
Withdrawal Rates per 100 Employees
Service
Age
0
1
2
3
4
5
6
7
8
9
10+
20
32.8
25.4
22.7
18.4
15.8
11.7
11.1
11.1
11.0
10.0
9.8
25
27.2
18.5
17.2
14.6
12.7
9.7
8.5
8.4
7.7
6.3
6.2
30
25.8
15.4
14.0
13.2
11.8
8.8
7.8
7.1
6.4
5.5
4.7
35
25.8
14.3
12.8
12.6
10.9
8.5
7.5
6.8
6.2
5.3
4.2
40
24.4
12.6
12.0
10.7
9.0
7.4
6.7
6.2
5.8
5.3
3.0
45
24.4
12.5
11.6
10.3
8.8
6.8
6.5
6.0
5.1
5.1
2.7
50
23.4
12.2
10.7
9.4
7.9
6.0
5.5
5.3
4.6
4.6
3.0
55
27.4
12.2
10.7
9.3
7.8
6.8
5.4
5.2
4.4
4.3
4.5
60
27.4
12.2
10.7
9.3
7.8
6.8
5.4
5.1
4.3
4.2
5.3
65
27.4
12.2
10.7
9.3
7.8
6.8
5.4
5.1
4.3
4.2
3.7
2. Withdrawal rates for female General Employees were used in accordance with the following illustrative example:
The withdrawal assumptions are the withdrawal assumptions used in the Jule 1, 2009 Florida Retirement System (FRS) Actuarial
Valuation.
-25-
Gabriel Roeder Smith & Company
Withdrawal Rates per 100 Employees
Service
Age
0
1
2
3
4
5
6
7
8
9
10+
20
30.3
25.8
22.1
17.4
15.4
13.5
11.4
11.3
10.5
10.2
11.6
25
26.6
19.8
17.1
13.0
12.9
10.7
9.7
9.2
7.8
7.1
5.3
30
25.4
16.9
14.5
11.6
11.3
9.4
8.7
8.1
7.1
6.5
5.4
35
25.4
15.9
13.5
11.2
10.9
9.0
8.0
7.8
6.8
6.2
4.6
40
24.4
14.0
12.1
10.0
9.1
7.0
6.5
6.3
6.1
5.0
3.3
45
24.4
13.9
11.9
9.8
8.8
6.7
6.5
6.1
5.8
4.7
3.0
50
23.2
13.4
11.0
8.8
8.4
6.2
5.9
5.5
5.5
4.6
3.0
55
23.2
13.4
11.0
8.7
8.3
6.1
5.8
5.4
5.4
4.5
3.0
60
23.2
13.4
11.0
8.7
8.3
6.1
5.8
5.4
5.4
4.5
3.0
65
23.2
13.4
11.0
8.7
8.3
6.1
5.8
5.4
5.4
4.5
3.0
The withdrawal assumptions are the withdrawal assumptions used in the Jule 1, 2009 Florida Retirement System (FRS) Actuarial
Valuation.
-25-
Gabriel Roeder Smith & Company
Table XI
(Cont'd)
Cite of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
E. Employee Withdrawal Rates (continued)
3. Withdrawal rates for male Firefighters and Police Officers were used in accordance with the following illustrative example:
4. Withdrawal rates for female Firefighters and Police Officers were used in accordance with the following illustrative example:
Withdrawal Rates per 100 Employees
Service
Age
0
1
2
3
4
5
6
7
8
9
10+
20
21.4
10.3
8.6
8.4
7.5
5.3
5.2
3.1
2.9
2.6
2.3
25
20.6
9.8
8.1
7.9
7.0
5.3
5.2
3.1
2.9
2.6
2.3
30
20.6
9.5
7.7
7.5
6.7
5.3
5.2
3.1
2.9
2.6
2.1
35
20.6
8.8
7.4
7.2
6.5
5.3
5.1
3.1
2.9
2.6
2.0
40
20.6
8.0
6.8
6.7
6.0
4.8
4.6
3.1
2.9
2.6
1.9
45
20.6
7.3
6.0
6.0
5.5
4.3
4.1
3.1
2.9
2.6
1.8
50
20.6
6.5
5.3
5.3
5.0
3.8
3.6
3.1
2.9
2.6
1.8
55
20.6
5.8
4.7
4.7
4.6
3.3
3.2
3.1
2.9
2.6
1.8
60
20.6
5.3
4.7
4.7
4.6
3.3
3.2
3.1
2.9
2.6
1.8
65
20.6
5.3
4.7
4.7
4.6
3.3
3.2
3.1
2.9
2.6
1.8
4. Withdrawal rates for female Firefighters and Police Officers were used in accordance with the following illustrative example:
The withdrawal assumptions are the withdrawal assumptions used in the Jule 1, 2009 FRS Actuarial Valuation.
-26-
Gabriel Roeder Smith & Company
Withdrawal Rates per 100 Employees
Service
Age
0
1
2
3
4
5
6
7
8
9
10+
20
21.3
15.5
12.3
10.3
9.7
6.1
5.9
5.0
4.2
4.2
1.9
25
21.3
14.2
11.6
9.8
9.2
6.1
5.9
5.0
4.2
4.2
1.9
30
21.3
13.2
10.6
9.3
8.7
6.1
5.9
5.0
4.2
4.2
1.7
35
21.3
12.2
9.6
8.8
8.4
6.1
5.9
5.0
4.2
4.1
1.5
40
21.3
11.2
8.6
8.3
7.6
6.1
5.9
5.0
4.1
4.1
2.5
45
21.3
10.2
7.6
7.6
7.0
6.1
5.9
5.0
4.1
4.1
2.5
50
21.3
9.2
6.6
6.6
6.4
6.1
5.9
5.0
4.1
4.0
1.6
55
21.3
8.4
5.8
5.6
5.4
5.3
5.1
5.0
4.1
4.0
4.0
60
21.3
8.4
5.8
5.6
5.4
5.3
5.1
5.0
4.1
4.0
4.0
65
21.3
8.4
5.8
5.6
5.4
5.3
5.1
5.0
4.1
4.0
4.0
The withdrawal assumptions are the withdrawal assumptions used in the Jule 1, 2009 FRS Actuarial Valuation.
-26-
Gabriel Roeder Smith & Company
Table XI
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
F. Disability Rates
1. Line -of -duty disability rates for General Employees were used in accordance with the following
illustrative example.
Age
Male
Female
20
0.002%
0.000%
25
0.002%
0.001%
30
0.003%
0.001%
35
0.005%
0.003%
40
0.009%
0.005%
45
0.014%
0.008%
50
0.022%
0.010%
55
0.034%
0.016%
60
0.048%
0.022%
65
0.050%
0.020%
2. Non -duty disability rates for General Employees were used in accordance with the following illustrative
example.
Awe
Male
Female
20
0.000%
0.000%
25
0.027%
0.010%
30
0.053%
0.026%
35
0.066%
0.049%
40
0.092%
0.070%
45
0.122%
0.114%
50
0.203%
0.184%
55
0.339%
0.294%
60
0.445%
0.419%
65
0.215%
0.105%
The disability assumptions are the disability assumptions used in the July 1, 2009 FRS Actuarial Valuation.
-27-
Gabriel Roeder Smith & Company
Table XI
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
F. Disability Rates (continued)
3. Line -of -duty disability rates for Firefighters and Police Officers were used in accordance with the
following illustrative example.
Age
Male
Female
20
0.012%
0.008%
25
0.012%
0.008%
30
0.017%
0.016%
35
0.029%
0.037%
40
0.051%
0.068%
45
0.087%
0.106%
50
0.138%
0.153%
55
0.215%
0.152%
60
0.301%
0.151%
65
0.231%
0.143%
4. Non -duty disability rates for Firefighters and Police Officers were used in accordance with the following
illustrative example.
we
Male
7 W!20
0.037%
0.036%
25
0.037%
0.036%
30
0.043%
0.046%
35
0.055%
0.075%
40
0.087%
0.118%
45
0.140%
0.209%
50
0.292%
0.254%
55
0.244%
0.328%
60
0.206%
0.328%
65
0.206%
0.328%
The disability assumptions are the disability assumptions used in the July 1, 2009 FRS Actuarial Valuation.
MI
Gabriel Roeder Smith & Company
Table XI
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
G. Assumed Retirement A(-
Retirement rates were used in accordance with the following tables.
1. For members with less than ten (10) years of service:
General Firefighters and
Age Employees Police Officers
Under 65 0% 0%
65 and above 100% 100%
2. For members with ten (10) or more years, but less than twenty -five (25) years of service:
General Firefighters and
Awe Employees Police Officers
r ' 55 - 64 10% 20%
65 and above 100% 100%
3. For members with twenty -five (25) or more years of service:
VAgUndeir
General
Firefighters and
e
Employees
Police Officers
55
2%
5%
55
25%
50%
56-64
5%
20%
65 and above
100%
100%
-29-
Gabriel Roeder Smith & Company
Table XI
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
H. Marital Assumptions
1. 100% of active members are assumed to be married.
2. Females are assumed to be three (3) years younger than their male spouses.
L Interest on Future Particibant Contributions
3.75 %, compounded annually.
J. Asset Valuation Method
The method used for determining the actuarial value of assets phases in the deviation between the
expected and actual return on assets at the rate of 20% per year. The actuarial value of assets will be
further adjusted to the extent necessary to fall within the corridor whose lower limit is 80% of the fair
market value of plan assets and whose upper limit is 120% of the fair market value of plan assets.
K. Cost Method
Normal Retirement, Termination, Disability, and Death Benefits: Entry Age Normal Cost Method
Under this method the normal cost for each active employee is the amount which is calculated to be a
level percentage of pay that would be required annually from his entry age to his assumed retirement
age to fund his estimated benefits, assuming the Fund had always been in effect. The normal cost for
the Fund is the sum of such amounts for all employees. The actuarial accrued liability as of any
valuation date for each active employee or inactive employee who is eligible to receive benefits under
the Fund is the excess of the actuarial present value of estimated future benefits over the actuarial
present value of current and future normal costs. The unfunded actuarial accrued liability as of any
valuation date is the excess of the actuarial accrued liability over the assets of the Fund.
-30-
Gabriel Roeder Smith & Company
Table XI
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
L. Changes Since Previous Valuation
1. Mortality assumption was:
The 1983 Group Annuity Male Mortality Table with ages set back two (2) years for women.
2. Allowance for Expenses or Contingencies was:
None. It is assumed the City will reimburse the Fund for actual expensed paid.
3. Salary increase assumption was:
Current salaries are assumed to increase 3% per year.
4. Withdrawal rates were:
Assumed to occur at rates approximating 11.62% at age 25 graded down to .16% at age 60 and over
(T -8 withdrawal table).
5. There were no disability rates.
6. Retirement rates were:
Later of age 60 or ten (10) years of service on the valuation date.
7. Interest on future Participant Contributions were:
Based upon the 120% Federal Midterm rate from the September preceding the valuation date.
8. There was a 1.5% expense load to make allowance for 30 year unreduced benefit provision with
LTD disability program.
9. Cost Method was:
Normal Retirement, Termination, Disability, and Death Benefits: Frozen Initial Liability Cost
Frozen Entry Age Normal Cost Method is a method under which the excess of the Actuarial
Present Value of Projected Benefits of the group included in the valuation, over the sum of the
Actuarial Value of Assets and the Unfunded Frozen Actuarial Accrued Liability is allocated as a
level percentage of earnings of the group between the valuation date and the assumed retirement
age. The portion of this Actuarial Present Value allocated to a specific year is the Normal Cost.
Under this method, actuarial gains (losses) reduce (increase) future Normal Costs.
-31-
Gabriel Roeder Smith & Company
Table XI
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Actuarial Assumptions and Actuarial Cost Methods
Used in the Valuation
L. Changes Since Previous Valuation (continued)
Frozen Initial Liability is the portion of the Actuarial Present Value of Projected Benefits which
is separated as of a valuation date and frozen under the Actuarial Cost Method being used. This
separated portion is the sum of an initial Unfunded Actuarial Accrued Liability and any increments
or decrements in the Actuarial Accrued Liability established subsequently as a result of changes in
pension plan benefits, actuarial assumptions or methods under the Entry Age Normal Actuarial
Cost Method.
Frozen Initial Liability Remaining Unfunded is the portion of the Frozen Initial Liability
remaining after the addition of interest and the deduction of amortization payments.
-32-
Gabriel Roeder Smith & Company
Table XII
-33-
Gabriel Roeder Smith & Company
City of Winter Springs
Defined Benefit Plan
Distribution by Attained Ate Groups
and Service Groups as of October 1, 2008
Firefighters
Attained
----------------------------------- - - - - -- COMPLETED YEARS OF SERVICE-----------------------------------------
Age Group
0 -4 5 -9
10 -14 15 -19 20 -24
25 -29 30 & Over
Total
Under 25
- -
- - -
- -
0
25 -29
- -
- - -
- -
0
30 -34
- 1
- - -
- -
1
35 -39
- -
- - -
- -
0
40 -44
- 1
- 2 -
- -
3
45 -49
- 1
1 4 3
- -
9
50 -54
- -
- - 1
1 2
4
55 -59
- -
- - -
- -
0
60 -64
- -
- - -
- -
0
65 & Over
- -
- - -
- -
0
TOTAL
0 3
1 6 4
1 2
17
10/01/2007
10/01/2008
Average Attained Age
N/A
46.04 years
Average Hire Age
N/A
27.39 years
Average Pay
N/A
$ 60,367
Percent Female
N/A
0.0%
-33-
Gabriel Roeder Smith & Company
Table XII
(Cont'd)
-34-
Gabriel Roeder Smith & Company
Total
7
7
16
17
12
26
23
14
14
7
143
City of Winter Springs
Defined Benefit Plan
Distribution by Attained Ate Groups
and Service Groups as of October 1, 2008
General Employees
Attained
-----------------------------------
- - - - -- COMPLETED YEARS OF SERVICE------------------ - - - - --
Age Group
00 = 4
55 = 9
10 -14 15 -19
20 -24
25 -29 30 & Over
Under 25
7
-
- -
-
- -
25 -29
5
2
- -
-
- -
30 -34
8
5
3 -
-
- -
35 -39
6
8
2 1
-
- -
40 -44
7
1
2 1
1
- -
45 -49
10
8
3 2
2
1 -
50 -54
4
5
3 7
4
- -
55 -59
3
5
2 -
3
- 1
60 -64
2
5
2 2
2
1 -
65 & Over
1
1
- 2
2
1 -
TOTAL
53
40
17 15
14
3 1
10/01/2007
10/01/2008
Average Attained Age
N/A
45.83 years
Average Hire Age
N/A
36.79 years
Average Pay
N/A
$ 42,213
Percent Female
N/A
35.0%
-34-
Gabriel Roeder Smith & Company
Total
7
7
16
17
12
26
23
14
14
7
143
Table XII
(Cont'd)
-35-
Gabriel Roeder Smith & Company
City of Winter Springs
Defined Benefit Plan
Distribution by Attained Ate Groups
and Service Groups as of October 1, 2008
Police Officers
Attained
----------------------------------- - - - - -- COMPLETED YEARS OF SERVICE-----------------------------------------
Age Group
00 = 4 55 = 9
10 -14 15 -19 20 -24
25 -29 30 & Over
Total
Under 25
2 -
- - -
- -
2
25 -29
8 2
- - -
- -
10
30 -34
6 4
3 - -
- -
13
35 -39
6 1
6 3 -
- -
16
40 -44
2 4
3 - 3
- -
12
45 -49
- 3
1 - 2
1 -
7
50 -54
- -
1 - 3
- -
4
55 -59
1 -
4 1 1
- -
7
60 -64
- -
- - -
- -
0
65 & Over
- -
- - -
- -
0
TOTAL
25 14
18 4 9
1 0
71
10/01/2007
10/01/2008
Average Attained Age
N/A
38.92 years
Average Hire Age
N/A
29.64 years
Average Pay
N/A
$ 52,181
Percent Female
N/A
18.3%
-35-
Gabriel Roeder Smith & Company
Table XII
(Cont'd)
-36-
Gabriel Roeder Smith & Company
City of Winter Springs
Defined Benefit Plan
Distribution by Attained Ate Groups
and Service Groups as of October 1, 2008
All Members
Attained
----------------------------------- - - - - -- COMPLETED YEARS OF SERVICE-----------------------------------------
Age Group
00 = 4
55 = 9
10 -14 15 -19 20 -24
25 -29
30 & Over
Total
Under 25
9
-
- - -
-
-
9
25 -29
13
4
- - -
-
-
17
30 -34
14
10
6 - -
-
-
30
35 -39
12
9
8 4 -
-
-
33
40 -44
9
6
5 3 4
-
-
27
45 -49
10
12
5 6 7
2
-
42
50 -54
4
5
4 7 8
1
2
31
55 -59
4
5
6 1 4
-
1
21
60 -64
2
5
2 2 2
1
-
14
65 & Over
1
1
- 2 2
1
-
7
TOTAL
78
57
36 25 27
5
3
231
10/01/2007
10/01/2008
Average Attained Age
42.7 years
43.72 years
Average Hire Age
33.6 years
33.90 years
Average Pay
$ 43,205
$ 46,613
Percent Female
27.4%
27.3%
-36-
Gabriel Roeder Smith & Company
Table XIII
City of Winter Springs
Defined Benefit Plan
Statistics for Participants Entitled to Deferred Benefits
and Participants Receiving Benefits
A. Entitled to Deferred Benefits
Current Age
Grou
Less than 40
40 -44
45 -49
50 -54
55 -59
60 -64
65 & Over
TOTAL
B. Receiving Benefits
Current Age
Group
Less than 50
50 -54
55 -59
60 -64
65 -69
70 -74
75 & Over
TOTAL
Count
38
14
15
8
3
5
Count
4
1
8
3
9
3
Total
Annual Benefit
$ 246,089
150,887
141,484
45,089
8,889
16,784
2,234
$ 611,456
Total
Annual Benefit
$ 93,673
34,228
157,849
54,415
137,084
13,331
13,864
$ 504,444
-37-
Gabriel Roeder Smith & Company
Average
Annual Benefit
$ 6,476
10,778
9,432
5,636
2,963
3,357
2,234
$ 7,279
Average
Annual Benefit
$ 23,418
34,228
19,731
18,138
15,232
4,444
4,621
$ 16,272
Table XIV
City of Winter Springs
Defined Benefit Plan
Reconciliation of Employee Data
A. Active Participants
1.
Active participants previous year
259
2.
Retired during year
(3)
3.
Died during year
(1)
4.
Disabled during year
0
5.
Terminated non - vested during year
(3)
6.
Terminated vested during year
(17)
7.
New active participants
16
8.
Transferred to County plan
(22)
9.
Rehired during year
2
10.
Active participants current year
231
B. Participants Receiving Benefits
1. Participants receiving benefits previous year 26
2. New retired participants 3
3. New terminated vested receiving benefits 0
4. New beneficiaries receiving benefits 3
5. Died or ceased payment during year (1)
6. Retired or terminated vested receiving benefits current year 31
C. Terminated Vested Participants Entitled to Future Benefits
1. Terminated vested entitled previous year
86
2. Died during year
0
3. Commenced receiving benefits during year
0
4. New terminated vested
35
5. Terminated vested paid lump sum (most prior to 10/1/2007)
(37)
6. Rehired
(2)
7. Adjustment
2
8. Terminated vested entitled current year
84
-38-
Gabriel Roeder Smith & Company
Table XV
City of Winter Springs
Defined Benefit Plan
Projected Retirement Benefits
The above projected payout of Plan benefits during the next ten years is based on assumptions
involving all decrements. Actual payouts may differ from the above estimates depending upon the
death, salary and retirement experience of the Plan. However, since the projected payment is
recomputed each valuation date, there is an automatic correction to the extent that actual experience
varies from expected experience.
-39-
Gabriel Roeder Smith & Company
Projected Total
Fiscal Year
Annual Payout
2009
$ 618,374
2010
$ 919,035
2011
$ 1,126,618
2012
$ 1,304,545
2013
$ 1,550,634
2014
$ 1,866,387
2015
$ 2,112,716
2016
$ 2,361,209
2017
$ 2,650,935
2018
$ 2,938,575
The above projected payout of Plan benefits during the next ten years is based on assumptions
involving all decrements. Actual payouts may differ from the above estimates depending upon the
death, salary and retirement experience of the Plan. However, since the projected payment is
recomputed each valuation date, there is an automatic correction to the extent that actual experience
varies from expected experience.
-39-
Gabriel Roeder Smith & Company
Table XVI
City of Winter Springs
Defined Benefit Plan
Summary of Transaction Information+
Year
Benefits
Administrative
Employee
City
Actuarial
Ending
Paid*
Expenses
Contributions
Contributions'
Value
09/30/2008
$ 384,482
$ 70,423
$ 365,288
$ 1,663,951
$ 18,746,975
09/30/2007
233,953
123,197
N/A
1,843,147
15,526,572
09/30/2006
171,697
84,340
N/A
1,505,020
11,951,383
09/30/2005
N/A
N/A
N/A
1,260,627
9,716,089
09/30/2004
140,509
62,225
N/A
1,013,379
8,134,588
09/30/2003
138,353
47,477
N/A
903,748
7,279,048
* Includes refunds
Information prior to September 30, 2008 as reported by prior actuary.
i Values prior to September 30, 2008 include Employee Contributions
-40-
Gabriel Roeder Smith & Company
Table XVI
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Recent Compensation, Termination and Investment Return Experience
General Police & Fire General Police & Fire
Last 3 Years N/A N/A N/A
Last 5 Years N/A N/A N/A
* Information prior to October 1, 2008 as reported by prior actuary.
Compensation
Valuation
Investment Return
% Increase /
(Decrease)
Date
Actual
Assumed
Actual
10/01/2008
3.9%
3.0%
5.6%
10/01/2007
N/A
N/A
N/A
10/01/2006
N/A
N/A
N/A
10/01/2005
N/A
N/A
N/A
10/01/2004
N/A
N/A
N/A
Last 3 Years N/A N/A N/A
Last 5 Years N/A N/A N/A
* Information prior to October 1, 2008 as reported by prior actuary.
N/A N/A N/A 0.9% 11.6% 8.0%
N/A N/A N/A 5.2% 7.8% 8.0%
-41-
Gabriel Roeder Smith & Company
Termination
Investment Return
Ratio of Actual
Net Market
Net Actuarial
Assumed Rate
Assumed
to Expected
Value Yield*
Value Yield*
of Return*
3.0%
1.2
3.1
(16.8 %)
10.1%
8.0%
N/A
N/A
N/A
13.8%
15.4%
8.0%
N/A
N/A
N/A
8.6%
9.5%
8.0%
N/A
N/A
N/A
11.5%
4.2%
8.0%
N/A
N/A
N/A
12.6%
0.6%
8.0%
N/A N/A N/A 0.9% 11.6% 8.0%
N/A N/A N/A 5.2% 7.8% 8.0%
-41-
Gabriel Roeder Smith & Company
Table XVII
City of Winter Springs
Defined Benefit Plan
Actuarial Valuation as of October 1, 2008
State Required Exhibit
A. Participant Data
1. Active participants
2. Retired participants and beneficiaries
receiving benefits
3. Disabled participants receiving benefits
4. Terminated vested participants
5. Annual payroll of active participants
6. Annual benefits payable to those currently
receiving benefits
B. Value of Assets
1. Actuarial Value
2. Market Value
C. Liabilities
1. Actuarial present value of future expected
benefit payments for active members
a. Retirement benefits
b. Vesting benefits
c. Death benefits
d. Disability benefits
e. Total
2. Actuarial present value of future expected benefit
payments for terminated vested members
3. Actuarial present value of future expected benefit
payments for members currently receiving benefits
a. Service retired (includes DROPS)
b. Disability retired
c. Beneficiaries
d. Miscellaneous (Refunds in Process)
e. Total
Prior Method /
Prior Plan /
Prior
Assumptions
10/01/2007 10/01/2008
259 231
Current Method /
Current Plan /
Current
Assumptions
10/01/2008
231
26 31 31
0 0 0
86 84 84
$ 11,190,013 $ 10,767,596 $ 10,767,596
$ 397,587 $ 504,444 $ 504,444
$ 15,526,572 $ 18,746,975 $ 18,746,975
$ 16,985,582 $ 15,622,479 $ 15,622,479
N/A
$
22,013,299
$
31,544,607
N/A
5,297,022
2,960,589
N/A
1,051,680
973,478
N/A
0
341,696
$ 24,712,960
$
28,362,001
$
35,820,370
$ 851,916
$
1,998,879
$
2,179,784
N/A
$
3,793,327
$
3,966,840
N/A
0
0
N/A
1,366,079
1,416,587
N/A
17,861
17,861
$ 3,962,082
$
5,177,267
$
5,401,288
-42-
Gabriel Roeder Smith & Company
Table XVII
(Cont' d)
City of Winter Springs
Defined Benefit Plan
Actuarial Valuation as of October 1, 2008
State Required Exhibit
Prior Method /
Current Method /
Current Plan /
Current
Assumptions
10/01/2008
Prior Plan /
Prior
Assumptions
10/01/2007 10/01/2008
4. Total actuarial present value of future
expected benefit payments
5. Actuarial accrued liabilities (EAN)*
6. Unfunded Frozen Initial Liability
7. Unfunded actuarial liabilities (EAN)
D. Statement of Accumulated Plan Benefits
1. Actuarial present value of accumulated vested
benefits
a. Participants currently receiving benefits
b. Other participants
c. Total
2. Actuarial present value of accumulated non -
vested plan benefits
3. Total actuarial present value of accumulated
plan benefits
E. Pension Cost
1. Total normal cost
2. Payment required to amortize unfunded liability
3. Interest adjustment
4. Total required contribution
5. Item 4 as a percentage of base payroll
6. Estimated employee contributions
7. Item 6 as a percentage of base payroll
8. Net amount payable by County and City
9. Item 8 as a percentage of base payroll
$ 29,526,958 $ 35,538,147 $ 43,401,442
$ 20,113,926 $ 29,556,645 $ 32,414,255
$ 4,587,354 $ 4,422,490 N/A
N/A N/A $ 13,667,280
$ 3,962,082
12,974,450
$ 16,936,532
$ 5,159,406
17,282,300
$ 22,441,706
$ 5,383,427
18,789,474
$ 24,172,901
503,752 531,943 525,243
$ 17,440,284
$ 22,973,649
$ 24,698,144
$ 1,445,568
411,006
148,526
$ 2,005,100
17.9%
$ 335,700
3.0%
$ 1,669,400
14.9%
$ 1,859,564
386,767
105,909
$ 2,352,240
21.8%
$ 323,028
3.0%
$ 2,029,212
18.8%
$ 1,387,362
1,147,129
119,897
* Frozen Initial Liability as of October 1, 2007
-43-
$ 2,654,388
24.7%
$ 323,028
3.0%
$ 2,331,360
21.7%
Gabriel Roeder Smith 8, Company
Table XVII
(Cont'd)
City of Winter Springs
Defined Benefit Plan
Actuarial Valuation as of October 1, 2008
State Required Exhibit
F. Past Contributions (Prior Year Valuation)
1. Total contribution required
2. Actual contributions made:
a. Members
b. City
c. Total
G. Disclosure of Following Items:
1. Actuarial present value of future salaries
- attained age
2. Actuarial present value of future employee
contributions - attained age
3. Actuarial present value of future contributions
from other sources
4. Amount of active members' accumulated
contributions
5. Actuarial present value of future salaries and
future benefits at entry age
6. Actuarial present value of future employee
contributions at entry age
-44-
Gabriel Roeder Smith & Company
Prior Method /
Current Method /
Prior Plan /
Current Plan /
Prior
Current
Assumptions
Assumptions
10/01/2007
10/01/2008
10/01/2008
$
1,807,722
$ 2,005,100
$
2,005,100
$
365,288
N/A
N/A
1,663,951
N/A
N/A
$
2,029,239
N/A
N/A
$
72,865,454
$ 71,634,579
$
93,841,493
N/A
$ 2,011,501
$
2,641,746
N/A
N/A
N/A
N/A
$ 1,948,000
$
1,948,000
N/A
N/A
N/A
N/A
N/A
N/A
-44-
Gabriel Roeder Smith & Company
Table XVII
(Cont'd)
City of Winter Springs
Defined Benefit Plan
State Required Exhibit
Amortization balances are written down in proportion to amortization payments.
Unfunded Actuarial Accrued Liabilities
10/01/2000
10/01/2002
10/01/2003
10/01/2004
10/01/2005
10/01/2006
10/01/2007
10/01/2008
10/01/2008
Initial
Assumption Change
Plan Amendment
Plan Amendment
Plan Amendment
Plan Amendment
Plan Amendment
Plan Amendment and Assumption Change
Method Change
TOTAL
Current
Remaining
Unfunded
Amortization
Funding
Liabilities
Pa rnt
Period
2,198,472
199,556
22 years
(27,894)
(2,453)
24 years
175,546
15,227
25 years
264,908
22,691
26 years
546,573
46,281
27 years
626,263
52,472
28 years
638,622
52,993
29 years
2,857,610
235,032
30 years
6,387,180
525,330
30 years
$ 13,667,280 $ 1,147,129
This actuarial valuation and /or cost determination 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 complete 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 and /or paid from the
plan's assets for which liabilities or current costs have not been established or other wise provided for in the valuation.
All known events or trends which may require material increase in plan costs or required contribution rates have been
taken into account in the valuation.
Enrollment Number: 08 -02802
Dated: August 9, 2010
Lawrence F. Wilson, A.S.A.
-45-
Gabriel Roeder Smith & Company