HomeMy WebLinkAbout2011 08 09 Regular 600 Request Acceptance Of The 2011 Actuarial Forecast Gabriel, Roeder, Smith & CompanyRS Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.1615 phone
Consultants & Actuaries Suite 505 954.525.0083 fax
Ft. Lauderdale, FL 33301 -1804 www.gabrietroeder.com
July 12, 2011
Mr. Shawn Boyle
Finance and Administrative Services Director
City of Winter Springs
1126 East State Road 434
Winter Springs, Florida 32708
Re: City of Winter Springs Defined Benefit Plan
Actuarial Study as of October 1, 2010 — Phase IV
Dear Shawn:
As requested, we are pleased to enclose six (6) copies of Phase IV of our Actuarial Study
including thirty (3 0) year projections for the City of Winter Springs Defined Benefit Plan.
If you should have any question concerning the above or if we may be of further assistance with
this matter, please do not hesitate to contact us.
Sincerest regards,
C
Lawrence F. Wilson, A.S.A.
Senior Consultant and Actuary
Peter N. Strong, A.S.A.
Consultant and Actuary
Enclosures
GRS Gabriel Roeder Smith & Company
Consultants & Actuaries
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY — PHASE IV
July 12, 2011
Gabriel Roeder Smith & Company
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
TABLE OF CONTENTS
Page
I. Executive Summary ...................................................................... ..............................1
II. Projection Results ......................................................................... ..............................6
III. Outline of Principal Provisions of the Retirement Plan ............... .............................27
IV. Actuarial Assumptions and Cost Methods ................................... .............................30
Gabriel Roeder Smith & Company
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
EXECUTIVE SUMMARY
At the request of the City of Winter Springs, we have completed thirty (30) year projections
illustrating the financial impact of several proposed plan provisions of the City of Winter Springs
Defined Benefit Plan (Plan).
Background — The benefit accrual rate is currently three percent (3 %) for each year of credited
service - maximum thirty (30) years.
Final average salary (FAS) used to calculate retirement benefits is currently the average of the
highest three (3) consecutive years of total compensation during employment with the City/
County. Total compensation includes but is not limited to commissions, overtime pay and
bonuses.
Vesting of benefits is currently phased in from three (3) to seven (7) years at twenty percent
(20 %) per year of service — twenty percent (20 %) vesting after three (3) years of service, forty
percent (40 %) vesting after four (4) years - grading to one hundred percent (100 %) vesting upon
completion of seven (7) years of service.
Employees are currently eligible for early retirement benefits upon the earlier of (a) attainment of
age fifty -five (55) with completion of ten (10) years of service or (b) completion of twenty -five
(25) years of service. Benefits are unreduced if early retirement occurs after attainment of age
fifty -five (55). Early retirement benefits are actuarially reduced for benefit commencement prior
to age fifty -five (55).
General Employees and Police Officers currently contribute three percent (3 %) of total
compensation to the Plan. Firefighters do not currently contribute to the Plan.
Proposed Chanzes — We understand the City wishes to determine the effect on current and
future City and County Plan contributions of the following proposed changes.
➢ Scenario 1 — Change the final average salary (FAS) used to calculate retirement benefits
to the average of the highest five (5) consecutive years of base plan compensation out of
the last ten (10) years - not less than the average of the highest three (3) consecutive years
of total compensation as of September 30, 2010 for all members. Base plan
compensation excludes commissions, bonuses and overtime pay in excess of one
hundred and fifty (15 0) hours per year.
FAS under the proposed change will not be reduced below FAS as of September 30,
2010.
➢ Scenario 2 — Change the vesting schedule for future benefit accruals to a seven (7) year
cliff vesting schedule for all members. Under this schedule, members are zero percent
(0 %) vested until completion of seven (7) years of service. Upon completion of seven (7)
years of service members are one hundred percent (100 %) vested.
GRS Gabriel Roeder Smith & Company - 1 -
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Accrued benefits as of September 30, 2010 remain subject to the current graded vesting
schedule of twenty percent (20 %) upon completion of three (3) years of service
increasing twenty percent (20 %) per year until one hundred percent (100 %) vested upon
completion of seven (7) years of service.
➢ Scenario 3 — Change the unreduced early retirement eligibility for all members to
attainment of age fifty -five (5 5) with completion of fifteen (15) years of service.
Accrued benefits as of September 30, 2010 remain payable unreduced upon attainment of
age fifty -five (55) with completion of ten (10) years of service.
➢ Scenario 4 — Reduce the benefit accrual rate for General Employees to two and a half
percent (2.5 %) per year of credited service after September 30, 2010 - maximum thirty
(30) years of total service.
Credited service earned through September 30, 2010 will retain the current three percent
(3 %) benefit accrual rate.
➢ Scenario 5 — Increase the participant contribution rate for all members _by two percent
(2 %) beginning in the fiscal year ending September 30, 2012. This will increase the
participant contribution rate for General Employees and Police Officers from three
percent (3 %) to five percent (5 %) and for Firefighters from zero percent (0 %) to two
percent (2 %).
➢ Scenario 6 — Close the Plan to future General Employees and create a Defined
Contribution (DC) Plan for all newly hired General Employees The City will provide
matching contributions in this DC Plan of up to five percent (5 %) of base plan
compensation. City contributions in the DC Plan will be subject to a seven (7) year cliff
vesting schedule. Forfeitures (from non - vested terminations) will reduce future employer
matching contributions.
➢ City's Proposal — Combination of Scenarios 1 through 6 above.
Results — The table on the following page shows the current net City and County contribution
(cost) and the sum of the projected net City and County contributions (costs) over the next ten
(10) and thirty (30) years for the baseline (current Plan) forecast and for each Scenario described
above separately and combined as a dollar amount ($thousands) and as a percentage of projected
covered payroll, respectively.
GRS Gabriel Roeder Smith & Company -2-
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
GRS Gabriel Roeder Smith & Company -3 -
Net City
/ County
Cost - Accumulated
Net
City / County
Cost
Next I
Amount
Year
(Decrease)
Next i
Amount
Years
(Decrease)
Next 30
Amount
Years
(Decrease)
Baseline (Current Plan)
- Net City and County Cost
$ 2,617
N/A
$ 30,146
N/A
$ 101,001
N/A
- Covered Payroll
$ 10,304
$ 115,906
$ 458,348
- % of Covered Payroll
25.4%
N/A
26.0%
N/A
22.0%
N/A
Scenario 1: FAS Based on Average
of Highest 5 Years of Revised Plan
Compensation (Base Pay Plus up to
150 Hours of Overtime Pay)
- Net City and County Cost
$ 2,368
($249)
$ 27,510
($2,636)
$ 92,218
($8,783)
- Covered Payroll
$ 9,746
$ 110,225
$ 441,195
- % of Covered Payroll
24.3%
(2.6 %)
25.0%
(2.4 %)
20.9%
(2.0 %)
Scenario 2: 7 -Year Cliff Vesting
for Future Service
- Net City and County Cost
$ 2,616
($ 1)
$ 30,118
($28)
$ 100,804
($197)
- Covered Payroll
$ 10,304
$ 115,906
$ 458,348
- % of Covered Payroll
25.4%
0.0%
26.0%
(0.0 %)
22.0%
0.0%
Scenario 3: Revised Early
Retirement Eligibility (55 &15)
- Net City and County Cost
$ 2,562
($55)
$ 29,576
($570)
$ 98,626
($2,375)
- Covered Payroll
$ 10,304
$ 116,614
$ 460,768
- % of Covered Payroll
24.9%
0.5%
25.4%
0.5%
21.4%
0.5%
Scenario 4: 2.5% Benefit Accrual
Rate for Future Service for General
Employees
- Net City and County Cost
$ 2,512
($ 105)
$ 28,784
($ 1,362)
$ 94,769
($6,232)
- Covered Payroll
$ 10,304
$ 115,906
$ 458,348
- % of Covered Payroll
24.4%
1.0%
24.8%
1.2%
20.7%
1.4%
Scenario 5: 2.0% Additional
Participant Contributions (5% for
Police /General, 2% for Firefighters)
- Net City and County Cost
$ 2,413
($204)
$ 27,896
($2,250)
$ 92,425
($8,576)
- Covered Payroll
$ 10,304
$ 115,906
$ 458,348
- % of Covered Payroll
23.4%
2.0%
24.1%
1.9%
20.2%
1.9%
Scenario 6: DC Plan for Future
General Employees (5.0%
employer matching contributions
with 7 -year cliff vesting)
- Net City and County Cost
$ 2,635
+$ 18
$ 29,043
($ 1,103)
$ 89,249
($ 11,752)
- Covered Payroll
$ 10,304
$ 115,094
$ 455,048
- % of Covered Payroll
25.6%
+0.2%
25.2%
1.0%
19.6%
2.6%
City's Proposal: All of the Above
(Scenarios 1 -6) Combined
- Net City and County Cost
$ 2,038
($579)
$ 23,315
($6,831)
$ 72,556
($28,445)
- Covered Payroll
$ 9,746
$ 110,837
$ 443,330
- % of Covered Payroll
20.9%
(5.9 %)
21.0%
(6.2 %)
16.4%
(6.4 %)
GRS Gabriel Roeder Smith & Company -3 -
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Actuarial Assumptions and Methods, System Provisions, Financial Data and Member Census
Data — The actuarial assumptions and methods, system provisions, financial data and member
census data employed for purposes of our Actuarial Study are the same actuarial assumptions
and methods, system provisions, financial data and member census data utilized for the October
1, 2010 Actuarial Valuation with the following modifications.
• For Scenario 3 and the City's Proposal (Scenarios 1 through 6 combined), assumed
retirement rates for Police Officers and Firefighters are based upon rates from the Table
below.
Assumed retirement rates for General Employ are based upon rates from the Table below.
Years of Service
Age
0-10
10 -15
15 -25
25 -30
30 or more
Under 55
0%
0%
0%
4%
5%
55
0%
10%
15%
40%
50%
56-64
0%
10%
15%
15%
20%
65
100%
100%
100%
100%
100%
Assumed retirement rates for General Employ are based upon rates from the Table below.
For Scenario 6 and the City's Proposal, we have assumed future General Employees will
fully participate in the proposed DC Plan at a level to fully earn the proposed 5% match.
We have further assumed employer contributions will be forfeited by those who
terminate employment for any reason prior to completion of seven (7) years of service.
For this purpose, current assumed withdrawal and other decrement rates are applied
throughout the projection period for future General Employees. Annual account
forfeitures (from non - vested terminations) are assumed to reduce future employer
matching contributions.
Throughout the forecast period new Police Officer and General Employee members are assumed
to be hired each year at a rate sufficient to maintain a constant active Police Officer and General
Employee headcount — stationary population. Active Firefighters are assumed not to be replaced
by new active Firefighters. New employees are assumed to have the same average demographic
characteristics (age, gender, salary — adjusted each year for inflation) as those members hired
over the past five (5) years.
GRS Gabriel Roeder Smith & Company -4-
Years of Service
Age
0-10
10 -15
15 -25
25 -30
30 or more
Under 55
0%
0%
0%
2%
2%
55
0%
5%
10%
20%
25%
56-64
0%
5%
10%
4%
5%
65
100%
100%
100%
100%
100%
For Scenario 6 and the City's Proposal, we have assumed future General Employees will
fully participate in the proposed DC Plan at a level to fully earn the proposed 5% match.
We have further assumed employer contributions will be forfeited by those who
terminate employment for any reason prior to completion of seven (7) years of service.
For this purpose, current assumed withdrawal and other decrement rates are applied
throughout the projection period for future General Employees. Annual account
forfeitures (from non - vested terminations) are assumed to reduce future employer
matching contributions.
Throughout the forecast period new Police Officer and General Employee members are assumed
to be hired each year at a rate sufficient to maintain a constant active Police Officer and General
Employee headcount — stationary population. Active Firefighters are assumed not to be replaced
by new active Firefighters. New employees are assumed to have the same average demographic
characteristics (age, gender, salary — adjusted each year for inflation) as those members hired
over the past five (5) years.
GRS Gabriel Roeder Smith & Company -4-
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Projections are deterministic - throughout the projection period Plan experience is expected to
match the assumptions — including a market value 8% annual investment return. In Phase II we
previously modeled the current Plan using an 8% +/- 1% investment return scenario to assess
sensitivity to investment return.
This Projection Study is intended to describe the estimated future financial effects of the
proposed benefit changes on the Plan and is not intended as a recommendation in favor of the
change nor in opposition to the change.
These calculations are based upon assumptions regarding future events. However, the Plan's
long term costs will be determined by actual future events, which may differ materially from the
assumptions made.
If you have reason to believe the assumptions used are unreasonable, the Plan provisions are
incorrectly described or referenced, important Plan provisions relevant to this Projection Study
are not described or that conditions have changed since the calculations were made, you should
contact the undersigned prior to relying on information in this Projection Study. If you have
reason to believe that the information provided in this Projection Study is inaccurate, or is in any
way incomplete, or if you need further information in order to make an informed decision on the
subject matter of this report, please contact the undersigned prior to making such decision.
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 opinion
contained herein.
If you should have any question concerning the above or if we may be of further assistance with
this matter, please do not hesitate to contact us.
Sincerest regards,
- ���
C
am.
Lawrence F. Wilson, A.S.A.
Senior Consultant and Actuary
PA &�-
Peter N. Strong, A.S.A.
Consultant and Actuary
Enclosures
GRS Gabriel Roeder Smith & Company -5 -
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
PROJECTION RESULTS
Scenario 1- Change the final average salary (FAS) used to calculate retirement benefits to the average of
the highest five (5) consecutive years of revised plan compensation out of the last ten (10) years - not less
than the average of the highest three (3) consecutive years of total compensation as of September 30,
2010 for all members.
The following Table shows the projected covered payroll and a comparison of the projected City and
County costs under the baseline forecast versus Scenario 1.
GRS Gabriel Roeder Smith & Company -6-
Projected City
Projected City
Cumulative
Fiscal
and County
Cost
and County
Cost
Reduction in
Reduction in
Year
Covered
Current Plan
Scenario 1
City and
City and
End
Payroll
Dollar
% of Pav
Dollar
% of Pay
County Cost
County Cost
2012
9,746,033
2,616,924
26.9%
2,367,720
24.3%
249,204
249,204
2013
10,046,148
2,767,868
27.6%
2,513,944
25.0%
253,924
503,128
2014
10,358,879
2,936,076
28.3%
2,678,114
25.9%
257,962
761,090
2015
10,642,728
2,991,957
28.1%
2,731,462
25.7%
260,495
1,021,585
2016
10,869,917
3,050,200
28.1%
2,786,447
25.6%
263,753
1,285,338
2017
11,158,232
3,088,560
27.7%
2,822,247
25.3%
266,313
1,551,651
2018
11,446,014
3,122,438
27.3%
2,853,738
24.9%
268,700
1,820,351
2019
11,707,565
3,150,499
26.9%
2,880,976
24.6%
269,523
2,089,874
2020
12,015,046
3,189,233
26.5%
2,916,906
24.3%
272,327
2,362,201
2021
12,234,184
3,232,564
26.4%
2,958,546
24.2%
274,018
2,636,219
2022
12,554,895
3,262,520
26.0%
2,986,899
23.8%
275,621
2,911,840
2023
12,854,388
3,282,179
25.5%
3,004,858
23.4%
277,321
3,189,161
2024
13,096,374
3,343,194
25.5%
3,063,393
23.4%
279,801
3,468,962
2025
13,441,930
3,381,192
25.2%
3,099,255
23.1%
281,937
3,750,899
2026
13,777,852
3,430,268
24.9%
3,145,658
22.8%
284,610
4,035,509
2027
14,162,504
3,486,935
24.6%
3,198,916
22.6%
288,019
4,323,528
2028
14,586,283
3,537,267
24.3%
3,246,025
22.3%
291,242
4,614,770
2029
15,043,425
3,601,294
23.9%
3,306,686
22.0%
294,608
4,909,378
2030
15,518,459
3,670,262
23.7%
3,371,453
21.7%
298,809
5,208,187
2031
16,012,582
3,720,398
23.2%
3,418,561
21.3%
301,837
5,510,024
2032
16,449,017
3,563,584
21.7%
3,257,466
19.8%
306,118
5,816,142
2033
16,981,194
3,640,385
21.4%
3,329,260
19.6%
311,125
6,127,267
2034
17,511,094
3,711,750
21.2%
3,396,615
19.4%
315,135
6,442,402
2035
18,057,329
3,765,589
20.9%
3,446,238
19.1%
319,351
6,761,753
2036
18,629,468
3,807,182
20.4%
3,483,635
18.7%
323,547
7,085,300
2037
19,201,373
3,829,786
19.9%
3,501,366
18.2%
328,420
7,413,720
2038
19,806,138
3,853,896
19.5%
3,520,002
17.8%
333,894
7,747,614
2039
20,445,605
3,873,494
18.9%
3,534,429
17.3%
339,065
8,086,679
2040
21,074,820
3,126,295
14.8%
2,781,215
13.2%
345,080
8,431,759
2041
21,765,635
2,966,941
13.6%
2,616,050
12.0%
350,891
8,782,650
5 Year
Totals
51,663,705
14,363,025
13,077,687
1,285,338
10 Year
Totals
110,224,746
30,146,319
27,510,100
2,636,219
30 Year
Totals
441,195,111
101,000,730
92,218,080
8,782,650
GRS Gabriel Roeder Smith & Company -6-
I Projected Net City and County Cost
Scenario 1-Change FAS to Final 5 -Yr Average of Base Pay w/ up to 150 Hours of Overtime for All Members
0
n
a�
0
4,500,000
7
y
y
F)
y
d
y
1
4,000,000
1 3,500,000
3,000,000
1 2,500,000
2,000,000
1 1,500,000
1,000,000
500,000
0
y �
7�
r
y �
d �
G
y t
bJ t
IsJ r
� r
N �
O �
O
1�
L O , L O ti 0 y 0 L O y 0 L O ti 0 y 0 L O y 0 L O ti 0 y 0
Current Plan Scenario 1
Projected Net City and County Cost as a Percentage of Pay
Scenario 1- Change FAS to Final 5 -Yr Average of Base Pay w/ up to 150 Hours of Overtime for All Members
0
n
30.0%
7
y
y
F)
y
d
y
7
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
y �
7�
t�
y�
d'
�C
G
y t
bJ t
IsJ r
� r
N �
O �
O
ti ti� ti� ti� ti� ti� ti�
, , , , , , , , T , , T , , ,
Current Plan Scenario 1
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Scenario 2 - Change the vesting schedule for future benefit accruals to a seven (7) year cliff vesting
schedule for all members. Members are zero percent (0 %) vested until completion of seven (7) years of
service. Members are one hundred percent (100 %) vested upon completion of seven (7) years of service.
The following Table shows the projected payroll and a comparison of the projected City and County costs
under the baseline forecast versus Scenario 2.
GRS Gabriel Roeder Smith & Company -9-
Projected City
Projected City
Cumulative
Fiscal
and County
Cost
and County
Cost
Reduction in
Reduction in
Year
Covered
Current Plan
Scenario 2
City and
City and
End
Payroll
Dollar
% of Pay
Dollar
% of Pay
County Cost
County Cost
2012
10,304,054
2,616,924
25.4%
2,615,632
25.4%
1,292
1,292
2013
10,613,289
2,767,868
26.1%
2,766,167
26.1%
1,701
2,993
2014
10,936,700
2,936,076
26.8%
2,934,061
26.8%
2,015
5,008
2015
11,223,179
2,991,957
26.7%
2,989,714
26.6%
2,243
7,251
2016
11,451,957
3,050,200
26.6%
3,047,650
26.6%
2,550
9,801
2017
11,734,215
3,088,560
26.3%
3,085,655
26.3%
2,905
12,706
2018
12,021,040
3,122,438
26.0%
3,119,214
25.9%
3,224
15,930
2019
12,271,659
3,150,499
25.7%
3,146,876
25.6%
3,623
19,553
2020
12,575,286
3,189,233
25.4%
3,185,216
25.3%
4,017
23,570
2021
12,774,990
3,232,564
25.3%
3,228,178
25.3%
4,386
27,956
2022
13,091,034
3,262,520
24.9%
3,257,766
24.9%
4,754
32,710
2023
13,392,491
3,282,179
24.5%
3,276,994
24.5%
5,185
37,895
2024
13,630,262
3,343,194
24.5%
3,337,580
24.5%
5,614
43,509
2025
13,969,630
3,381,192
24.2%
3,375,177
24.2%
6,015
49,524
2026
14,303,166
3,430,268
24.0%
3,423,837
23.9%
6,431
55,955
2027
14,686,750
3,486,935
23.7%
3,480,091
23.7%
6,844
62,799
2028
15,119,053
3,537,267
23.4%
3,530,048
23.3%
7,219
70,018
2029
15,577,091
3,601,294
23.1%
3,593,662
23.1%
7,632
77,650
2030
16,061,743
3,670,262
22.9%
3,662,182
22.8%
8,080
85,730
2031
16,563,648
3,720,398
22.5%
3,712,019
22.4%
8,379
94,109
2032
17,007,608
3,563,584
21.0%
3,554,887
20.9%
8,697
102,806
2033
17,552,912
3,640,385
20.7%
3,631,356
20.7%
9,029
111,835
2034
18,093,372
3,711,750
20.5%
3,702,419
20.5%
9,331
121,166
2035
18,643,717
3,765,589
20.2%
3,755,931
20.1%
9,658
130,824
2036
19,229,195
3,807,182
19.8%
3,797,217
19.7%
9,965
140,789
2037
19,812,820
3,829,786
19.3%
3,819,455
19.3%
10,331
151,120
2038
20,435,950
3,853,896
18.9%
3,843,170
18.8%
10,726
161,846
2039
21,088,543
3,873,494
18.4%
3,862,349
18.3%
11,145
172,991
2040
21,736,398
3,126,295
14.4%
3,114,713
14.3%
11,582
184,573
2041
22,445,967
2,966,941
13.2%
2,954,967
13.2%
11,974
196,547
5 Year
Totals
54,529,179
14,363,025
14,353,224
9,801
10 Year
Totals
115,906,369
30,146,319
30,118,363
27,956
30 Year
Totals
458,347,719
101,000,730
100,804,183
196,547
GRS Gabriel Roeder Smith & Company -9-
0
n
a�
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I Projected Net City and County Cost
Scenario 2-Ch an ge Vesting Schedule to 7 -Year Cliff Vesting for Future Service for All Members
4,500,000 —
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
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Projected Net City and County Cost as a Percentage of Pay
Scenario 2 - Change Vesting Schedule to 7 -Year Cliff Vesting for Future Service for All Members
0
n
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7
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20.0%
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15.0%
10.0%
5.0%
0.0%
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Current Plan Scenario2
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Scenario 3 - Change the unreduced early retirement eligibility to attainment of age fifty -five (55) with
completion of fifteen (15) years of service for all members.
The following Table shows the projected payroll and a comparison of the projected City and County costs
under the baseline forecast versus Scenario I
GRS Gabriel Roeder Smith & Company -12-
Projected City
Projected City
Cumulative
Fiscal
and County
Cost
and County Cost
Reduction in
Reduction in
Year
Covered
Current Plan
Scenario 3
City and
City and
End
Payroll
Dollar
% of Pay
Dollar
% of Pay
County Cost
County Cost
2012
10,304,054
2,616,924
25.4%
2,561,985
24.9%
54,939
54,939
2013
10,626,798
2,767,868
26.0%
2,712,629
25.5%
55,239
110,178
2014
10,963,586
2,936,076
26.8%
2,880,667
26.3%
55,409
165,587
2015
11,277,027
2,991,957
26.5%
2,937,190
26.0%
54,767
220,354
2016
11,515,048
3,050,200
26.5%
2,990,255
26.0%
59,945
280,299
2017
11,815,231
3,088,560
26.1%
3,030,742
25.7%
57,818
338,117
2018
12,125,510
3,122,438
25.8%
3,067,447
25.3%
54,991
393,108
2019
12,392,152
3,150,499
25.4%
3,092,006
25.0%
58,493
451,601
2020
12,697,454
3,189,233
25.1%
3,129,708
24.6%
59,525
511,126
2021
12,896,834
3,232,564
25.1%
3,173,338
24.6%
59,226
570,352
2022
13,224,096
3,262,520
24.7%
3,200,644
24.2%
61,876
632,228
2023
13,503,453
3,282,179
24.3%
3,214,014
23.8%
68,165
700,393
2024
13,718,356
3,343,194
24.4%
3,269,559
23.8%
73,635
774,028
2025
14,047,638
3,381,192
24.1%
3,307,229
23.5%
73,963
847,991
2026
14,380,700
3,430,268
23.9%
3,350,992
23.3%
79,276
927,267
2027
14,757,561
3,486,935
23.6%
3,406,899
23.1%
80,036
1,007,303
2028
15,189,910
3,537,267
23.3%
3,453,862
22.7%
83,405
1,090,708
2029
15,650,316
3,601,294
23.0%
3,515,600
22.5%
85,694
1,176,402
2030
16,137,615
3,670,262
22.7%
3,584,512
22.2%
85,750
1,262,152
2031
16,646,871
3,720,398
22.3%
3,631,487
21.8%
88,911
1,351,063
2032
17,088,097
3,563,584
20.9%
3,471,259
20.3%
92,325
1,443,388
2033
17,631,939
3,640,385
20.6%
3,546,093
20.1%
94,292
1,537,680
2034
18,175,023
3,711,750
20.4%
3,613,640
19.9%
98,110
1,635,790
2035
18,726,713
3,765,589
20.1%
3,666,088
19.6%
99,501
1,735,291
2036
19,315,518
3,807,182
19.7%
3,705,823
19.2%
101,359
1,836,650
2037
19,901,055
3,829,786
19.2%
3,727,105
18.7%
102,681
1,939,331
2038
20,525,181
3,853,896
18.8%
3,748,903
18.3%
104,993
2,044,324
2039
21,178,118
3,873,494
18.3%
3,764,912
17.8%
108,582
2,152,906
2040
21,822,097
3,126,295
14.3%
3,016,208
13.8%
110,087
2,262,993
2041
22,533,740
2,966,941
13.2%
2,854,800
12.7%
112,141
2,375,134
5 Year
Totals
54,686,513
14,363,025
14,082,726
280,299
10 Year
Totals
116,613,694
30,146,319
29,575,967
570,352
30 Year
Totals
460,767,691
101,000,730
98,625,596
2,375,134
GRS Gabriel Roeder Smith & Company -12-
0
n
a�
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Projected Net City and County Cost
Scenario 3 - Change Unreduced Early Retirement Eligibility to 55&15 for All Members
4,500,000
1
4,000,000
3,500,000
1
3,000,000
2,500,000
1
2,000,000
1,500,000
1,000,000
500,000
0
Current Plan Scenario
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Projected Net City and County Cost as a Percentage of Pay
Scenario 3- Change Unreduced Early Retirement Eligibility to 55& 15 for All Members
0
M
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7
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25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
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Current Plan Scenario
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Scenario 4 - Reduce the benefit accrual rate for General Employ to two and a half percent (2.5 %) per
year of credited service after September 30, 2010 - maximum thirty (3 0) years of total service.
The following Table shows the projected payroll and a comparison of the projected City and County costs
under the baseline forecast versus Scenario 4.
GRS Gabriel Roeder Smith & Company - 15 -
Projected City
Projected City
Cumulative
Fiscal
and County
Cost
and County Cost
Reduction in
Reduction in
Year
Covered
Current Plan
Scenario 4
City and
City and
End
Payroll
Dollar
% of Pav
Dollar
% of Pay
County Cost
County Cost
2012
10,304,054
2,616,924
25.4%
2,512,154
24.4%
104,770
104,770
2013
10,613,289
2,767,868
26.1%
2,654,353
25.0%
113,515
218,285
2014
10,936,700
2,936,076
26.8%
2,816,149
25.7%
119,927
338,212
2015
11,223,179
2,991,957
26.7%
2,866,956
25.5%
125,001
463,213
2016
11,451,957
3,050,200
26.6%
2,917,516
25.5%
132,684
595,897
2017
11,734,215
3,088,560
26.3%
2,949,286
25.1%
139,274
735,171
2018
12,021,040
3,122,438
26.0%
2,976,594
24.8%
145,844
881,015
2019
12,271,659
3,150,499
25.7%
2,997,223
24.4%
153,276
1,034,291
2020
12,575,286
3,189,233
25.4%
3,029,022
24.1%
160,211
1,194,502
2021
12,774,990
3,232,564
25.3%
3,064,688
24.0%
167,876
1,362,378
2022
13,091,034
3,262,520
24.9%
3,088,471
23.6%
174,049
1,536,427
2023
13,392,491
3,282,179
24.5%
3,101,746
23.2%
180,433
1,716,860
2024
13,630,262
3,343,194
24.5%
3,153,003
23.1%
190,191
1,907,051
2025
13,969,630
3,381,192
24.2%
3,184,388
22.8%
196,804
2,103,855
2026
14,303,166
3,430,268
24.0%
3,226,224
22.6%
204,044
2,307,899
2027
14,686,750
3,486,935
23.7%
3,275,258
22.3%
211,677
2,519,576
2028
15,119,053
3,537,267
23.4%
3,318,797
22.0%
218,470
2,738,046
2029
15,577,091
3,601,294
23.1%
3,375,068
21.7%
226,226
2,964,272
2030
16,061,743
3,670,262
22.9%
3,435,684
21.4%
234,578
3,198,850
2031
16,563,648
3,720,398
22.5%
3,480,420
21.0%
239,978
3,438,828
2032
17,007,608
3,563,584
21.0%
3,317,118
19.5%
246,466
3,685,294
2033
17,552,912
3,640,385
20.7%
3,386,372
19.3%
254,013
3,939,307
2034
18,093,372
3,711,750
20.5%
3,450,851
19.1%
260,899
4,200,206
2035
18,643,717
3,765,589
20.2%
3,497,689
18.8%
267,900
4,468,106
2036
19,229,195
3,807,182
19.8%
3,532,822
18.4%
274,360
4,742,466
2037
19,812,820
3,829,786
19.3%
3,548,435
17.9%
281,351
5,023,817
2038
20,435,950
3,853,896
18.9%
3,564,303
17.4%
289,593
5,313,410
2039
21,088,543
3,873,494
18.4%
3,576,132
17.0%
297,362
5,610,772
2040
21,736,398
3,126,295
14.4%
2,819,887
13.0%
306,408
5,917,180
2041
22,445,967
2,966,941
13.2%
2,652,796
11.8%
314,145
6,231,325
5 Year
Totals
54,529,179
14,363,025
13,767,128
595,897
10 Year
Totals
115,906,369
30,146,319
28,783,941
1,362,378
30 Year
Totals
458,347,719
101,000,730
94,769,405
6,231,325
GRS Gabriel Roeder Smith & Company - 15 -
Projected Net City and County Cost
Scenario 4-Change Benefit Multiplier to 2.5% for Future Service for General Employees Only
0
n
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7
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3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
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Current Plan Scenario
Projected Net City and County Cost as a Percentage of Pay
Scenario 4 - Change Benefit Multiplierto 2.5% for Future Service for General Employees Only
0
n
30.0%
7
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25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
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Current Plan
Scenario4
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CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Scenario 5 - Increase the participant contribution rate by two percent (2 %) - from three percent (3 %) to
five percent (5 %) for Police Officers and General Employ and from zero percent (0 %) to two percent
(2 %) for Firefighters
The following Table shows the projected payroll and a comparison of the projected City and County costs
under the baseline forecast versus Scenario 5.
GRS Gabriel Roeder Smith & Company - is-
Projected City
Projected City
Cumulative
Fiscal
and County
Cost
and County Cost
Reduction in
Reduction in
Year
Covered
Current Plan
Scenario 5
City and
City and
End
Payroll
Dollar
% of Pay
Dollar
% of Pay
County Cost
County Cost
2012
10,304,054
2,616,924
25.4%
2,412,654
23.4%
204,270
204,270
2013
10,613,289
2,767,868
26.1%
2,558,751
24.1%
209,117
413,387
2014
10,936,700
2,936,076
26.8%
2,721,523
24.9%
214,553
627,940
2015
11,223,179
2,991,957
26.7%
2,772,648
24.7%
219,309
847,249
2016
11,451,957
3,050,200
26.6%
2,827,424
24.7%
222,776
1,070,025
2017
11,734,215
3,088,560
26.3%
2,861,203
24.4%
227,357
1,297,382
2018
12,021,040
3,122,438
26.0%
2,890,377
24.0%
232,061
1,529,443
2019
12,271,659
3,150,499
25.7%
2,914,529
23.8%
235,970
1,765,413
2020
12,575,286
3,189,233
25.4%
2,948,268
23.4%
240,965
2,006,378
2021
12,774,990
3,232,564
25.3%
2,988,740
23.4%
243,824
2,250,202
2022
13,091,034
3,262,520
24.9%
3,013,414
23.0%
249,106
2,499,308
2023
13,392,491
3,282,179
24.5%
3,028,261
22.6%
253,918
2,753,226
2024
13,630,262
3,343,194
24.5%
3,085,951
22.6%
257,243
3,010,469
2025
13,969,630
3,381,192
24.2%
3,118,372
22.3%
262,820
3,273,289
2026
14,303,166
3,430,268
24.0%
3,162,061
22.1%
268,207
3,541,496
2027
14,686,750
3,486,935
23.7%
3,212,456
21.9%
274,479
3,815,975
2028
15,119,053
3,537,267
23.4%
3,255,470
21.5%
281,797
4,097,772
2029
15,577,091
3,601,294
23.1%
3,311,803
21.3%
289,491
4,387,263
2030
16,061,743
3,670,262
22.9%
3,372,587
21.0%
297,675
4,684,938
2031
16,563,648
3,720,398
22.5%
3,414,068
20.6%
306,330
4,991,268
2032
17,007,608
3,563,584
21.0%
3,249,854
19.1%
313,730
5,304,998
2033
17,552,912
3,640,385
20.7%
3,317,324
18.9%
323,061
5,628,059
2034
18,093,372
3,711,750
20.5%
3,379,363
18.7%
332,387
5,960,446
2035
18,643,717
3,765,589
20.2%
3,423,748
18.4%
341,841
6,302,287
2036
19,229,195
3,807,182
19.8%
3,455,157
18.0%
352,025
6,654,312
2037
19,812,820
3,829,786
19.3%
3,467,739
17.5%
362,047
7,016,359
2038
20,435,950
3,853,896
18.9%
3,481,067
17.0%
372,829
7,389,188
2039
21,088,543
3,873,494
18.4%
3,489,435
16.5%
384,059
7,773,247
2040
21,736,398
3,126,295
14.4%
2,731,083
12.6%
395,212
8,168,459
2041
22,445,967
2,966,941
13.2%
2,559,238
11.4%
407,703
8,576,162
5 Year
Totals
54,529,179
14,363,025
13,293,000
1,070,025
10 Year
Totals
115,906,369
30,146,319
27,896,117
2,250,202
30 Year
Totals
458,347,719
101,000,730
92,424,568
8,576,162
GRS Gabriel Roeder Smith & Company - is-
@' 4,500,000
0
4,000,000
a
Ir
RO 3,500,000
n
3,000,000
0
•e
1 2,500,000
1 2,000,000
1 1,500,000
1 1,000,000
1 500,000
1 0
Projected Net City and County Cost
Scenario 5 - Increase Employee Contributions by 2%
(to 5% for Police and General Employees and 2% for Firefighters)
Current Plan Scenario5
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30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
Projected Net City and County Cost as a Percentage of Covered Pay
Scenario 5 - Increase Employee Contributions by 2%
(to 5% for Police and General Employees and 2% for Firefighters)
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Current Plan Scenario
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Scenario 6 - Create a Defined Contribution (DC) Plan for all newly hired General Employ in which
the City will provide matching contributions of up to five percent (5 %) of revised plan compensation, and
City contributions will be subject to a seven (7) year cliff vesting schedule.
The following Table shows the projected payroll and a comparison of projected City and County costs
under the baseline forecast versus Scenario 6.
GRS Gabriel Roeder Smith & Company -21-
Projected City
Projected City
Cumulative
Fiscal
and County
Cost
and County Cost
Reduction in
Reduction in
Year
Covered
Current
Plan
Scenario 6
City and
City and
End
Payroll
Dollar
% of Pay
Dollar
% of Pay
County Cost
County Cost
2012
10,304,054
2,616,924
25.4%
2,634,601
25.6%
(17,677)
(17,677)
2013
10,593,289
2,767,868
26.1%
2,748,365
25.9%
19,503
1,826
2014
10,898,566
2,936,076
26.9%
2,890,706
26.5%
45,370
47,196
2015
11,167,369
2,991,957
26.8%
2,924,287
26.2%
67,670
114,866
2016
11,382,335
3,050,200
26.8%
2,951,688
25.9%
98,512
213,378
2017
11,644,010
3,088,560
26.5%
2,965,271
25.5%
123,289
336,667
2018
11,918,189
3,122,438
26.2%
2,973,406
24.9%
149,032
485,699
2019
12,145,729
3,150,499
25.9%
2,972,407
24.5%
178,092
663,791
2020
12,428,422
3,189,233
25.7%
2,985,036
24.0%
204,197
867,988
2021
12,611,604
3,232,564
25.6%
2,997,299
23.8%
235,265
1,103,253
2022
12,913,557
3,262,520
25.3%
3,002,956
23.3%
259,564
1,362,817
2023
13,214,264
3,282,179
24.8%
2,994,969
22.7%
287,210
1,650,027
2024
13,460,909
3,343,194
24.8%
3,015,485
22.4%
327,709
1,977,736
2025
13,803,973
3,381,192
24.5%
3,027,788
21.9%
353,404
2,331,140
2026
14,147,222
3,430,268
24.2%
3,046,848
21.5%
383,420
2,714,560
2027
14,549,594
3,486,935
24.0%
3,072,662
21.1%
414,273
3,128,833
2028
14,991,705
3,537,267
23.6%
3,096,003
20.7%
441,264
3,570,097
2029
15,464,961
3,601,294
23.3%
3,127,255
20.2%
474,039
4,044,136
2030
15,967,079
3,670,262
23.0%
3,163,898
19.8%
506,364
4,550,500
2031
16,474,345
3,720,398
22.6%
3,194,072
19.4%
526,326
5,076,826
2032
16,913,817
3,563,584
21.1%
3,013,465
17.8%
550,119
5,626,945
2033
17,459,434
3,640,385
20.9%
3,060,352
17.5%
580,033
6,206,978
2034
17,996,055
3,711,750
20.6%
3,109,465
17.3%
602,285
6,809,263
2035
18,539,647
3,765,589
20.3%
3,138,900
16.9%
626,689
7,435,952
2036
19,119,407
3,807,182
19.9%
3,157,272
16.5%
649,910
8,085,862
2037
19,698,608
3,829,786
19.4%
3,155,357
16.0%
674,429
8,760,291
2038
20,321,408
3,853,896
19.0%
3,151,528
15.5%
702,368
9,462,659
2039
20,972,433
3,873,494
18.5%
3,140,774
15.0%
732,720
10,195,379
2040
21,619,412
3,126,295
14.5%
2,360,802
10.9%
765,493
10,960,872
2041
22,326,606
2,966,941
13.3%
2,175,780
9.7%
791,161
11,752,033
5 Year
Totals
54,345,613
14,363,025
14,149,647
213,378
10 Year
Totals
115,093,567
30,146,319
29,043,066
1,103,253
30 Year
Totals
455,048,003
101,000,7311
89,248,697
11,752,033
GRS Gabriel Roeder Smith & Company -21-
0
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4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
Projected Net City and County Cost
Scenario 6- Future General Employees Enter401(k) Plan with up to
5% Matching Employer Contribution and 7 -Year Cliff Vesting
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20.0%
15.0%
10.0%
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Projected Net City and County Cost as a Percentage of Covered Pay
Scenario 6 - Future General Employees Enter401(k) Plan with up to
5% Matching Employer Contribution and 7 -Year Cliff Vesting
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CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
City's Proposal - Scenarios 1 through 6 combined.
The following Table shows the projected payroll and a comparison of the projected City and County costs
under the baseline forecast versus the City's Proposal (Scenarios 1 through 6 combined).
GRS Gabriel Roeder Smith & Company -24-
Projected City
Projected City
Cumulative
Fiscal
and County
Cost
and County Cost
Reduction in
Reduction in
Year
Covered
Current Plan
All Changes
City and
City and
End
Payroll
Dollar
% of Pay
Dollar
% of Pay
County Cost
County Cost
2012
9,746,033
2,616,924
26.9%
2,038,347
20.9%
578,577
578,577
2013
10,058,318
2,767,868
27.5%
2,159,208
21.5%
608,660
1,187,237
2014
10,383,013
2,936,076
28.3%
2,304,528
22.2%
631,548
1,818,785
2015
10,690,432
2,991,957
28.0%
2,344,172
21.9%
647,785
2,466,570
2016
10,925,077
3,050,200
27.9%
2,373,534
21.7%
676,666
3,143,236
2017
11,227,414
3,088,560
27.5%
2,393,576
21.3%
694,984
3,838,220
2018
11,535,472
3,122,438
27.1%
2,408,953
20.9%
713,485
4,551,705
2019
11,811,038
3,150,499
26.7%
2,412,916
20.4%
737,583
5,289,288
2020
12,120,811
3,189,233
26.3%
2,429,513
20.0%
759,720
6,049,008
2021
12,339,231
3,232,564
26.2%
2,450,465
19.9%
782,099
6,831,107
2022
12,669,524
3,262,520
25.8%
2,459,227
19.4%
803,293
7,634,400
2023
12,949,231
3,282,179
25.3%
2,454,509
19.0%
827,670
8,462,070
2024
13,171,073
3,343,194
25.4%
2,479,491
18.8%
863,703
9,325,773
2025
13,509,244
3,381,192
25.0%
2,495,266
18.5%
885,926
10,211,699
2026
13,845,756
3,430,268
24.8%
2,514,067
18.2%
916,201
11,127,900
2027
14,225,316
3,486,935
24.5%
2,540,884
17.9%
946,051
12,073,951
2028
14,649,342
3,537,267
24.1%
2,562,475
17.5%
974,792
13,048,743
2029
15,108,294
3,601,294
23.8%
2,593,455
17.2%
1,007,839
14,056,582
2030
15,586,426
3,670,262
23.5%
2,628,996
16.9%
1,041,266
15,097,848
2031
16,087,761
3,720,398
23.1%
2,657,999
16.5%
1,062,399
16,160,247
2032
16,522,046
3,563,584
21.6%
2,475,287
15.0%
1,088,297
17,248,544
2033
17,052,898
3,640,385
21.3%
2,518,254
14.8%
1,122,131
18,370,675
2034
17,584,253
3,711,750
21.1%
2,560,950
14.6%
1,150,800
19,521,475
2035
18,132,260
3,765,589
20.8%
2,585,821
14.3%
1,179,768
20,701,243
2036
18,707,325
3,807,182
20.4%
2,599,171
13.9%
1,208,011
21,909,254
2037
19,281,249
3,829,786
19.9%
2,593,016
13.4%
1,236,770
23,146,024
2038
19,886,601
3,853,896
19.4%
2,583,101
13.0%
1,270,795
24,416,819
2039
20,526,801
3,873,494
18.9%
2,566,976
12.5%
1,306,518
25,723,337
2040
21,152,529
3,126,295
14.8%
1,781,822
8.4%
1,344,473
27,067,810
2041
21,845,412
2,966,941
13.6%
1,590,177
7.3%
1,376,764
28,444,574
5 Year
Totals
51,802,873
14,363,025
11,219,789
3,143,236
10 Year
Totals
110,836,839
30,146,319
23,315,212
6,831,107
30 Year
Totals
443,330,180
101,000,730
72,556,156
28,444,574
GRS Gabriel Roeder Smith & Company -24-
0
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4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
Projected Net City and County Cost
All Proposed Changes Combined
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Projected Net City and County Cost as a Percentage of Covered Pay
All Proposed Changes Combined
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15.0%
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5.0%
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Current Plan City's Proposal - All Scenarios Combined
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
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. Total Compensation
Wages, salaries and other amounts received (whether or not paid in cash) for personal
services actually rendered in the course of employment. This includes but is not limited to
commissions, overtime pay and bonuses.
E. Final Average Compensation
Average earnings during the three (3) highest consecutive compensation periods during
employment with the City.
F. 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.
GRS Gabriel Roeder Smith & Company -27-
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
G. Early Retirement
1. Eli _ ig bilitX
(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.
H. Late Retirement
1. Eli ig bilitX
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.
I. Disability 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.
J. 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.
GRS Gabriel Roeder Smith & Company -28-
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
K. Participant Contributions
Three percent (3 %) of compensation for General Employees and Police Officers.
L. 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%
M. Normal Form 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.
GRS Gabriel Roeder Smith & Company -29-
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
ACTUARIAL ASSUMPTIONS AND METHODS
A. Mortality
For healthy General Employee participants, the RP -2000 Combined Mortality Table was
used with separate rates for males and females and fully 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.
GRS Gabriel Roeder Smith & Company -30-
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%
GRS Gabriel Roeder Smith & Company -30-
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
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 July 1, 2010 Florida
Retirement System (FRS) Actuarial Valuation.
GRS Gabriel Roeder Smith & Company -31 -
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
59
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 July 1, 2010 Florida
Retirement System (FRS) Actuarial Valuation.
GRS Gabriel Roeder Smith & Company -31 -
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
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 July 1, 2010 FRS
Actuarial Valuation.
GRS Gabriel Roeder Smith & Company -32-
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
59
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
59
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 July 1, 2010 FRS
Actuarial Valuation.
GRS Gabriel Roeder Smith & Company -32-
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
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.
Age
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, 2010 FRS
Actuarial Valuation.
GRS Gabriel Roeder Smith & Company
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
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.
Age
Male
Female
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, 2010 FRS
Actuarial Valuation.
GRS Gabriel Roeder Smith & Company - 34 -
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
G. Assumed Retirement Age
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
Age Employees Police Officers
55-64 10% 20%
65 and above 100% 100%
3. For members with twenty -five (25) or more years of service:
GRS Gabriel Roeder Smith & Company -35 -
General
Firefighters and
Age
Employees
Police Officers
Under 55
2%
5%
55
25%
50%
56-64
5%
20%
65 and above
100%
100%
GRS Gabriel Roeder Smith & Company -35 -
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
Note For Scenario 3 and the City's Proposal (Scenarios 1 through 6 combined), retirement
rates for Police Officers and Firefighters were used in accordance with the following
table.
Retirement rates for General Employees were used in accordance with the following
table.
Years of Service
Age
0- 10
10 -15
15 -25
25 -30
30 or more
Under 55
Under 55
0%
0%
0%
4%
5%
55
0%
10%
15%
40%
50%
56-64
0%
10%
15%
15%
20%
65
100%
100%
100%
100%
100%
Retirement rates for General Employees were used in accordance with the following
table.
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 Participant 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.
GRS Gabriel Roeder Smith & Company -36-
Years of Service
Age
0-10
10 -15
15 -25
25 -30
30 or more
Under 55
0%
0%
0%
2%
2%
55
0%
5%
10%
20%
25%
56-64
0%
5%
10%
4%
5%
65
100%
100%
100%
100%
100%
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 Participant 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.
GRS Gabriel Roeder Smith & Company -36-
CITY OF WINTER SPRINGS DEFINED BENEFIT PLAN
ACTUARIAL STUDY AS OF OCTOBER 1, 2010
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 Plan had always
been in effect. The normal cost for the Plan 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 Plan is the excess of the actuarial
present value of 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 Plan assets.
GRS Gabriel Roeder Smith & Company -37-