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HomeMy WebLinkAbout2011 05 10 Consent 201 Requesting Approval of the Board of Trustees Special Meeting Minutes of February 22, 2011 CITY OF WINTER SPRINGS, FLORIDA j MINUTES BOARD OF TRUSTEES SPECIAL MEETING FEBRUARY 22, 2011 CALL TO ORDER The Special Meeting of Tuesday, February 22, 2011, of the Board of Trustees was called to Order by Chairperson Maria Fair at 5:08 p.m. in the Commission Chambers of the Municipal Building (City Hall, 1126 East State Road 434, Winter Springs, Florida 32708). Roll Call: Chairperson Maria Fair, present Vice Chairman Ben McMahan, absent Board Member Vernon Rozelle, Jr., present Board Member Max Swaim, present Board Member Barbara Watkins, present Assistant City Attorney Kate Latorre, present A moment of silence was followed by the Pledge of Allegiance led by Chairperson Fair. Next, Chairperson Fair asked if there were any Agenda changes. None were noted. PUBLIC INPUT Mr. Cory Green, Seminole County Fire Department: as a Plan Participant, Mr. Green asked the Board Members if the Pension Plan would be discussed at this Meeting. Chairperson Fair commented, "Tonight, we are only addressing one (1) Agenda Item which is on a Pension distribution for a survivor annuity benefit correction and that is all. It will be on the next Meeting which we are working out a date for that." Mr. Green inquired about what plans were used for the Phase I Study. Brief discussion. CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING - FEBRUARY 22, 2011 PAGE 2 OF 6 REGULAR AGENDA REGULAR -,y 600. Finance And Administrative Services Department T•r Requesting Approval For A Survivor Annuity Benefit Correction For Ms. Nellie P. O Pilcher. Mr. Shawn Boyle, Director, Finance and Administrative Services Department presented this Agenda Item and introduced Mr. Glenn E. Thomas, Esquire from Lewis Longman & Walker P.A., who would be addressing the Board by telephone. Continuing, Mr. Boyle reviewed the history of the Pension documents with the Board Members. Mr. Glenn E. Thomas, Esquire, Lewis Longman & Walker P.A., 2600 Centennial Place, Suite 100, Tallahassee, Florida: via telephone, Mr. Thomas stated, "Obviously, you can not pay someone — a Pension benefit to which they are not entitled. Going forward you can not continue to pay — double what somebody is entitled to as a benefit. What do you do about all the months that have already been paid? It is an unfortunate thing, but you are entitled to recoup that money. This has been upheld in many court Cases." Continuing, Mr. Thomas remarked, "I have looked over the letter that has been proposed and it seems to address everything." With further discussion with Mr. Thomas, Chairperson Fair referred to the "Participant Distribution Election Form ". Chairperson Fair commented, "Also Glenn (Thomas) — based on my knowledge, when a person annuitizes either a Pension benefit or an annuity, the `Distribution Election Form' needs to be Notarized and I have noticed that these forms have not been Notarized." Mr. Glenn answered, "That might be a Policy issue. I do not know offhand what your Policy - whether it is required to be Notarized or not." Discussion. Mr. Thomas asked, "Is this the only copy in existence and if so, do we know why nothing was Notarized and was just signed by her ?" Mr. Boyle replied, "We do not have any first hand knowledge. That packet is what we the City have on file as the official copy. If another copy exists, we are not aware of it at this time." Further discussion continued on the monthly distribution amount. CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING — FEBRUARY 22, 2011 PAGE 3 OF 6 Mr. Thomas noted, "If it is determined that her signature without being Notarized was 1 ineffectual and therefore you had to go back to the default, that default may deprive her of any benefit." Chairperson Fair asked, "Is there a requirement under Florida Law for a married individual to make an election that includes a spousal provision. That would somehow influence the default option." With further discussion, Mr. Thomas stated, "In this case, what he was electing to do was to reduce the monthly payment and it may be that - was the reason they required a Notary on some of these — because he is reducing his monthly Pension benefit. And since it is a spousal form of income, they are requiring him to get her signature on it — notarized. That is my understanding of what is behind the requirement of a Notary. Referring to Ms. Pilcher, Mr. Thomas stated, "She can only get what the Plan says she can get. There is no other legal binding rule — that is going to affect this." Ms. Mary Wilson, Human Resource Coordinator, Finance And Administrative Services Department: addressed the Board Members and stated, "The spouse is the beneficiary on the beneficiary form, so the spouse's signature would be needed if the husband put someone other than her as the beneficiary. That is what needs to be Notarized." Mr. Thomas remarked, "I am reading the Plan and if that is the case, and if she did not sign it or agree to it, what he would be entitled to would be a straight life benefit which means that when he died, his benefits should have stopped." Discussion. Board Member Vernon Rozelle, Jr. asked, "Does the Notary come into play unless the signature is contested ?" Attorney Kate Latorre commented, "In the absence of the requirement in your Plan that there be a Notary, I would agree with you." Referring to page two of the "Participant Distribution Election Form ", Mr. Thomas indicated that, "If the spouse completes section 6., which she did, a proper Witness must complete either section 7. or section 8. As you notice on (section) 7. The Plan Representative as a witness signed as the Witness to her signature. So, it was either a Witness or a Notarization and what you have is a Witness." Chairperson Fair noted, "What you are telling us under the Plan documents that that is sufficient ?" Mr. Thomas replied, "Not under the Plan documents. I do not think the Plan documents mentions it, but under this form, that is sufficient." Chairperson Fair stated, "Regardless of what the form said, we would have to defer to the Plan documents because that is the document that governs the Plan." Mr. Thomas commented, "I understand, but it is silent on spousal elections." Tape 1 /Side B CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING - FEBRUARY 22, 2011 PAGE 4 OF 6 Board Member Max Swaim asked, "Has there been any discussion with Ms. Pilcher concerning this entire issue at this point ?" Mr. Boyle replied, "No." With further discussion, Mr. Boyle commented, "The calculation that I gave to Madam Chair(person Fair), the four thousand dollars ($4,000.00) includes through March (2011), so the earliest correction would be April (2011)." Summarizing this issue, Mr. Boyle stated, "We have a fiduciary responsibility to the other annuitants or the participants in the Plan to make the correction. I think we owe that to all the people that are participating. My recommendation would be a retrospective correction back to August 1 (2010) reduce the payout by the fifty percent (50 %) that is stated in the document, however, unclear or clearly it is and then to make the adjustment beginning - April 1 (2011) and I think forty -eight (48) months to recapture the four thousand — dollars ($4,000.00) that has been paid out to recoup that over the forty -eight (48) months and to reduce her ongoing annuity payment for the next forty-eight (48) months by that amount which is going to be roughly eighty -seven dollars ($87.00) plus or minus over the next forty -eight (48) months; and then restore her annuity payment on the forty-ninth (49 payment back to the five hundred dollars ($500.00) that she is due." Chairperson Fair asked, "So what happens if she passes away during this time before this is paid back ?" Mr. Boyle replied, "I think at that point, you would forgive it. There is no recourse." Discussion. Referencing the new `Benefit Determination Form" provided by Gabriel Roeder Smith & Company, Mr. Boyle stated, "For the Record, they are going forward." Chairperson Fair replied, "Yes, now that we have the sample here. That is a huge improvement." "I WOULD LIKE TO MAKE A MOTION THAT THE CITY PROCEED TO RESOLVE THIS ISSUE TO COMMENCE APRIL 1 (2011) THEREABOUTS AND PROCEED WITH PAYING HER. I WOULD PROPOSE A TWENTY FOUR (24) MONTH PAYBACK." MOTION BY BOARD MEMBER SWAIM. MOTION FAILS FOR LACK OF A SECOND. Mr. Boyle noted that, "Just for clarification, if you went forty -eight (48) months, the payment would go from one thousand, seventeen dollars and thirty -nine cents ($1,017.39); we would half that down to five hundred and eight dollars and sixty -nine [cents] ($508.69) then we would reduce it for the retrospective recapture of eighty -four dollars and seventy -eight cents ($84.78). We would have forty-eight (48) payments of four hundred, and twenty -three dollars and ninety -one cents ($423.91) and then that would revert back to five hundred and eight dollars and sixty -nine [cents] ($508.69) after the forty -eight (48) months." CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING - FEBRUARY 22, 2011 PAGE 5 OF 6 "I SO MAKE A MOTION WE APPROVE A PAYBACK PROCESS STARTING APRIL 1 (2011) OR MAY 1 (2011) WHENEVER IT IS APPRECIABLY CAN BE EXECUTED BY THE ATTORNEY AND BY SHAWN'S (BOYLE) OFFICE FOR A FORTY -EIGHT (48) MONTH PAYBACK OF THE AMOUNT AS WE DISCUSSED." MOTION BY BOARD MEMBER ROZELLE. SECONDED BY .0 BOARD MEMBER SWAIM. DISCUSSION. VOTE: BOARD MEMBER ROZELLE: AYE BOARD MEMBER SWAIM: AYE CHAIRPERSON FAIR: AYE BOARD MEMBER WATKINS: AYE MOTION CARRIED. Board Member Barbara Watkins asked, "Are you going to notify her by mail ?" Mr. Boyle replied, "I will notify her any way you direct me to." Continuing, Mr. Boyle mentioned, "I would be more than happy to sit down and discuss it with her." Chairperson Fair commented, "I agree with Barbara (Watkins). I do not think we should send her a letter." There were no other objections voiced. In regard to the next Meeting on the Pension Plan, Mr. Boyle asked, "We would like the Board of Trustees to entertain a date and I expect the Meeting to be somewhat lengthy in its presentation. We would propose that Larry Wilson (Gabriel Roeder Smith & Company) who is our Actuary — who created Phase I and Phase II of the analysis of the current Pension Plan be present. He is going to do the presentation." Chairperson Fair suggested the following dates of March 29 or March 31 2011. There were no objections voiced. Referencing the Phase II Study being provided to the Board Members, Mr. Boyle stated, "I can email it." Board Member Rozelle asked, "Can we have it in a printed format ?" Mr. Boyle replied, "Absolutely." Chairperson Fair stated, "You will then let us know about the (March) 29 or the (March) 31 (2011)." Mr. Boyle answered, "Yes." Chairperson Fair asked Joan Brown, Deputy City Clerk to notify Board Member Ben McMahan of the dates. Deputy City Clerk Brown stated, "Yes." CITY OF WINTER SPRINGS, FLORIDA MINUTES BOARD OF TRUSTEES SPECIAL MEETING — FEBRUARY 22, 2011 PAGE 6 OF 6 ADJOURNMENT Chairperson Fair adjourned the Special Meeting at 6:18 p.m. N RESPECTFULLY SUBMITTED: JOAN L. BROWN DEPUTY CITY CLERK NOTE: These Minutes were approved at the , 2011 Board of Trustees Regular Meeting.