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Home My WebLink About2012 05 08 Other - Actuarial Impact Statement GRS Gabriel Roeder Smith & Company One East Broward Blvd. 954.527.161 phone Consultant &Actuaries Suite 505 954,525.0083 fax Ft.Lauderdale,FL 33301-1804 www.gabriclroedercom March 2, 2012 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 Impact Statement Dear Shawn: As requested, we are pleased to enclose three (3) copies of an Actuarial Impact Statement as of October 1, 2010 for Ordinances 2011-52 and 2011-57 (copies attached) under the City of Winter Springs Defined Benefit Plan with the State of Florida. Background—The Plan currently provides: > Benefit accrual rate is three percent(3%) for each year of credited service - maximum thirty(30) years. > Final average salary(FAS)used to calculate retirement benefits is 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 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. > Early retirement eligibility is 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. Early retirement benefits are unreduced if early retirement occurs on or 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 contribute three percent(3%) of total compensation to the Plan. Firefighters do not contribute to the Plan. Mr. Shawn Boyle March 2, 2012 Page 2 Proposed Ordinance—The proposed Ordinance provides: ➢ Final average salary(FAS)used to calculate retirement benefits is 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, 2011 for all members.Base plan compensation excludes commissions, bonuses and overtime pay in excess of one hundred and fifty (150)hours per year. ➢ Vesting schedule for future benefit accruals is a seven(7) year cliff vesting schedule for all members. Under this schedule, members are not vested until completion of seven (7) years of service. Upon completion of seven(7)years of service members are fully vested. Accrued benefits as of September 30, 2011 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. ➢ Unreduced early retirement eligibility for all members is the earlier of(a) attainment of age fifty-five(55)with completion of fifteen (15) years of service or(b) completion of twenty-five (25)years of service. Accrued benefits as of September 30, 2011 remain payable unreduced upon attainment of age fifty-five(55)with completion of ten(10) years of service. ➢ Benefit accrual rate for General Employees is three percent(3%) for each year of credited service earned through September 30, 2011 and two and a half percent(2.5%)per year of credited service earned after September 30, 2011 -maximum thirty(30) years of total service. ➢ Participant contribution rate for all members is increased to five percent(5%)beginning with the fiscal year ending September 30, 2012. ➢ Plan is closed to General Employees hired after September 30, 2011. Results—Based upon the results of our Actuarial Impact Statement,the proposed benefit provisions decrease the minimum required County and City contribution by 6.3% of covered payroll ($651,227). The figure in parentheses is the Plan cost expressed as a dollar amount based on projected covered annual payroll ($10,304,054). Filing Requirements—We have prepared the Actuarial Impact Statement for filing with the State of Florida. Please note that this Statement must be signed and dated on behalf of the Board Gabriel Roeder Smith&Company Mr. Shawn Boyle March 2, 2012 Page 3 of Trustees. Copies of the proposed Ordinance upon passage at first reading along with the signed and dated Actuarial Impact Statement should be filed with the State at the following address: Mr. Douglas E. Beckendorf,A.S.A. Bureau of Local Retirement Services Division of Retirement Building 8 Post Office Box 9000 Tallahassee, Florida 32315-9000 Actuarial Assumptions and Methods, Financial Data and Member Census Data—The actuarial assumptions and methods, financial data and Member census data utilized in this Actuarial Impact Statement are the same actuarial assumptions and methods, financial data and Member census data utilized in the October 1, 2010 Actuarial Valuation with the exception of the revised retirement rates. Plan provisions considered in this Actuarial Impact Statement are the same Plan provisions considered in the October 1, 2010 Actuarial Valuation with the exception of the proposed amendments described above. This Actuarial Impact Statement 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 Actuarial Impact Statement 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 Actuarial Impact Statement. If you have reason to believe that the information provided in this Actuarial Impact Statement 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. Future actuarial measurements may differ significantly from the current measurements presented in this report due to such factors as the following: plan experience differing from that anticipated by the economic or demographic assumptions; changes in economic or demographic assumptions; increases or decreases expected as part of the natural operation of the methodology Gabriel Roeder Smith&Company Mr. Shawn Boyle March 2, 2012 Page 4 used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan's funded status); and changes in plan provisions or applicable law. Due to the limited scope of the actuary's assignment, the actuary did not perform an analysis of the potential range of such future measurements. This report should not be relied on for any purpose other than the purpose described in the primary communication. Determinations of the financial results associated with the benefits described in this report in a manner other than the intended purpose may produce significantly different results. This report has been prepared by actuaries who have substantial experience valuing public employee retirement systems. To the best of our knowledge the information contained in this report is accurate and fairly presents the actuarial position of the City of Winter Springs Defined Benefit Plan as of the valuation date. All calculations have been made in conformity with generally accepted actuarial principles and practices, with the Actuarial Standards of Practice issued by the Actuarial Standards Board and with applicable statutes. The signing actuaries are independent of the plan sponsor. 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, , . . L- -- 'L-65-1\—...) a. .›.s.),..,f Lawrence F.Wilson,A.S.A. Peter N. Strong, A.S.A. Senior Consultant and Actuary Consultant and Actuary Enclosures Gabriel Roeder Smith&Company 9.16.11 RESOLUTION NO. 2011-52 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, FLORIDA, AMENDING THE DEFINED BENEFIT PLAN AND TRUST FOR EMPLOYEES OF THE CITY OF WINTER SPRINGS; AMENDING ARTICLE I OF THE DEFINED BENEFIT PLAN TO REVISE THE DEFINITION OF "PLAN COMPENSATION"; AMENDING ARTICLE II OF THE DEFINED BENEFIT PLAN TO REVISE THE ELIGIBILTY PROVISIONS AND PROVIDE THAT EMPLOYEES HIRED ON OR AFTER OCTOBER 1, 2011 SHALL NOT PARTICIPATE IN THE DEFINED BENEFIT PLAN BUT SHALL PARTICIPATE IN A DEFINED CONTRIBUTION PLAN; AMENDING ARTICLE IV OF THE DEFINED BENEFIT PLAN TO PROVIDE FOR A FIVE PERCENT CONTRIBUTION BY PARTICIPANTS; AMENDING ARTICLE V OF THE DEFINED BENEFIT PLAN TO PROVIDE A TWO AND ONE-HALF PERCENT BENEFIT MULTIPLIER FOR SERVICE ON AND AFTER OCTOBER 1, 2011 FOR GENERAL GOVERNMENT EMPLOYEES AND MODIFYING THE DEFINITION OF AVERAGE COMPENSATION; AMENDING ARTICLE VI OF THE DEFINED BENEFIT PLAN TO MODIFY THE ELIGIBILITY REQUIREMENTS FOR AN UNREDUCED EARLY RETIREMENT BENEFIT; AMENDING ARTICLE VIII OF THE DEFINED BENEFIT PLAN TO MODIFY THE VESTING SCHEDULE; PROVIDING FOR CONFLICTS; PROVIDING FOR SEVERABILITY; PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Commission of the City of Winter Springs has determined that certain changes to the City's Defined Benefit Plan and Trust are in the best interest of the City, its employees and taxpayers; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, FLORIDA: Section 1. That Article I, Section 1.10 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 1.10 Compensation Definitions. Any reference in this Plan to Compensation is a reference to the definition in this Section 1.10, unless the Plan reference specifies a modification 1 9.16.11 to this definition. The Retirement Committee will take into account only Compensation actually paid for the relevant period. (A) Total Compensation. "Total Compensation" means wages, salaries, and other amounts received (whether or not paid in cash) for personal services actually rendered in the course of employment with the Employer,but only to the extent included in gross income. This definition includes, but is not limited to commissions, overtime pay and bonuses. With respect to the Plan Years beginning prior to October 1, 1998, Total Compensation does not include elective contributions. With respect to Plan Years beginning on and after October 1, 1998, Total Compensation includes elective contributions. Total Compensation also does not include: (1) Employer contributions to a plan of deferred compensation to the extent the contributions are not included in the gross income of the Employee for the taxable year in which contributed, on behalf of an Employee to a Simplified Employee Pension Plan to the extent such contributions are excludible from the Employee's gross income, and any distributions from a plan of deferred compensation, regardless of whether such amounts are includible in the gross income of the Employee when distributed. (2) Other amounts which receive special tax benefits, such as premiums for group term life insurance (but only to the extent that the premiums are not includible in the gross income of the Employee), or contributions made by an Employer towards the purchase of an annuity contract described in Code §403(b) (whether or not the contributions are excludible from the gross income of the Employee). (B) Plan Compensation. Plan Compensation means Total Compensation described in Section 1.10(A), except that Plan Compensation includes elective contributions for all Plan Years. Plan Compensation applies to determine a Participant's benefit formula and Accrued Benefit under Article V. Effective October 10, 2011, Plan Compensation means base salary including overtime pay up to one hundred fifty (150) hours in a Plan Year, and excluding all other forms of compensation. Section 2. That Article II, Section 2.01 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 2.01 Eligibility. Each Employee(other than an Excluded Employee)becomes a Participant in the Plan on the first day of the month(if employed on that date)immediately following the date 6 months after his Employment Commencement Date. "Employment Commencement Date" means the date on which the Employee first performs an Hour of Service for the Employer. Notwithstanding any other provision of this Plan, any Employee other than a sworn police officer and Forensic Professional hired on or after October 1, 2011, shall not be eligible to participate in this Plan. Any Employee other than a sworn police officer or forensic professional hired on or after October 1,2011, shall participate in the defined contribution plan established 2 9.16.11 pursuant to Resolution 2011-52, if eligible to participate in the defined contribution plan. Employees hired as sworn police officers or forensic professional on or after October 1, 2011 shall participate in this Plan. (A) Excluded Employee (1) An Employee is an Excluded Employee if his customary weekly employment with the Employer is less than 29 hours. An Employee is an Excluded Employee if he is actively participating (and "benefiting" within the meaning of Treas. Reg. § 1.410(b)-3) in another qualified plan maintained by the Employer other than the Money Purchase Pension Plan and Trust for Employees of the City of Winter Springs, Florida(hereinafter referred to as the"Money Purchase Plan"). (2) If a Participant has not incurred a Separation from Service but becomes an Excluded Employee, then during the period such a Participant is an Excluded Employee, the Participant will not accrue a benefit under the Plan attributable to any period during which he is an Excluded Employee. However, during such period of exclusion, the Participant, without regard to employment classification, continues to receive credit for vesting under Article VIII for each included Year of Service. (3) If an Excluded Employee who is not a Participant becomes eligible to participate in the Plan by reason of a change in employment classification, he will participate in the Plan immediately if he has satisfied the eligibility conditions of Section 2.01 and would have been a Participant had he not been an Excluded Employee during his period of Service. Furthermore, the Plan takes into account all of the Participant's included Years of Service with the Employer as an Excluded Employee for purposes of vesting credit under Article VIII. (B) Employees with Non-Contributing Service. Any Employee who completed Years of Service prior to adoption of Resolution No. 2003-44, but did not make contributions to this Trust Fund or to the Money Purchase Plan, shall be credited with Years of Accrual Service upon payment of the Required Participant Contributions due under this Plan and the required participant contributions due under the Money Purchase Plan for such service. Section 3. That Article II, Section 2.03 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 3 9.16.11 2.03 Participation upon Re-employment. A Participant whose employment terminates and who is subsequently reemployed prior to October 1, 2011 will re-enter the Plan as a Participant on the date of his re-employment. An Employee other than a sworn police officer or forensic professional who satisfies the Plan's eligibility conditions but who terminates employment with the Employer prior to becoming a Participant will, upon reemployment, participate in the defined contribution plan established pursuant to Resolution 2011-52, in accordance with the terms and conditions therein provided. . --. - - : ':.- •-•::. - . - - • . - . Any Employee other than a sworn police officer or forensic professional who terminates employment prior to satisfying the Plan's eligibility conditions and who is subsequently reemployed on or after October 1, 2011 shall participate in the defined contribution plan established pursuant to Resolution 2011-52, in accordance with the terms and conditions therein provided. . --- - - . ' .. •-•;.. •- _. .... - •, - . , • • . . _ - 2.01. Any Employee employed as a police officer or forensic professional who terminates employment prior to satisfying the Plan's eligibility conditions and who is subsequently reemployed becomes a Participant in accordance with the provisions of Section 2.01. Section 4. That Article N, Section 4.01 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 4.01 Required Participant Contributions. The Plan did not permit nor require Participant Contributions prior to October 1,2000. Effective October 1,2000,each Participant is required to contribute 3% of Compensation to the Plan, which contribution shall be considered the Required Participant Contribution. Effective October 10, 2011, each Participant is required to contribute 5% of Compensation to the Plan, which contribution shall be considered the Required Participant Contribution. The required participant contribution shall be deducted from each Participant's Compensation whenever such Compensation is paid, and remitted to the Trustee. Required participant contributions shall be considered an Employer "pick-up" contribution and shall be designated as employer contributions pursuant to Section 414(h) of the Internal Revenue Code, contingent upon the contributions being excluded from the Participant's gross income for federal income tax purposes. For all other purposes of this Plan, such contributions shall be considered Participant contributions. * * * 4 9.16.11 Section 5. That Article V, Section 5.02 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 5.02 Amount of Normal Retirement Pension/Accrued Benefit. The Annual Benefit limitations of Article III apply to the determination of a Participant's normal retirement pension and Accrued Benefit in the manner prescribed in Section 3.05(I1). (A) Normal Retirement Pension. (1) Benefit Formula (a) A Participant's normal retirement pension equals 2% of the Participant's Average Final Compensation multiplied by his Years of Accrual Service for service prior to October 1, 2000, and 3% of the Participant's Average Final Compensation multiplied by his Years of Accrual Service for service on and after October 1, 2000. Such pension will be adjusted for any distribution in accordance with Section 8.05. The maximum number of Years of Accrual Service taken into account in the normal retirement pension is 30, counting forward from the date of initial participation to include any purchased past service. (b) Notwithstanding any provision of subparagraph (a) to the contrary, effective October 1, 2008, a Participant's normal retirement pension shall equal 3%of the Participant's Average Final Compensation multiplied by his Years of Accrual service for service prior to October 1, 2000; provided that such multiplier shall increase by one- fourth of one percent(.25%) each year beginning October 1,2005 as follows: Effective Date Multiplier for Service Prior to October 1,2000 October 1,2005 2.25% October 1,2006 2.50% October 1, 2007 2.75% October 1, 2008 3.00% (c) A Participant's normal retirement pension shall be calculated by applying the multiplier for service prior to October 1, 2000 that is in effect on the date of the Participant's separation from service. fill Effective October 10, 2011, a participating General Employee's normal retirement pension of a Participant other than a sworn police officer or firefighter or forensic professional shall equal 3% of the Participant's Average Compensation 5 9.16.11 multiplied by Years of Accrual Service prior to October 1, 2011, and 2.5% of the Participant's Average Compensation multiplied by Years of Accrual Service on and after October 1, 2011. The normal retirement pension of a Participant employed as a sworn police officer or firefighter or forensic professional shall equal 3% of the Participant's Average Compensation multiplied by Years of Accrual Service. Such pension will be adjusted for any distribution in accordance with Section 8.05. The maximum number of Years of Accrual Service taken into account in the normal retirement pension is 30., counting forward from the date of initial participation to include any purchased past service. (2) Average Compensation. Average Compensation is the average of the Participant's Plan Compensation for the Averaging Period in the Participant's Compensation History which results in the highest Average Compensation. A Participant's Compensation History is the Participant's entire period of employment with the Employer. The Averaging Period is 3 consecutive Compensation periods (or the entire period of employment, if shorter). Effective October 1, 2011 Average Compensation shall be the average of the highest five (5) consecutive years of Plan Compensation out of the ten (10) years immediately preceding termination of employment. A Compensation period is the 12-month period ending on the last day of the Plan Year. Notwithstanding the above, a Participant's Average Compensation shall not be less than his or her average compensation as of September 30,2011. Section 6. That Article VI, Section 6.01 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 6.01 Eligibility for Early Retirement Pension. A Participant as of September 30, 2011 who has received credit for at least 10 Years of Service (as defined in Section 8.06) and has attained age 55 may elect an early retirement pension. A Participant as of September 30, 2011 who separates from service after satisfying the service requirement but not the age requirement may elect to receive an early retirement pension upon satisfying the age requirement. In addition, a Participant as of September 30, 2011 who has completed 25 Years of Service (as defined in Section 8.06)may elect an early retirement pension. A Participant employed after September 30, 2011 who has received credit for at least 15 Years of Service (as defined in Section 8.06), and has attained age 55 may elect an early retirement pension. A Participant employed on September 30, 2011 who separates from service after satisfying the service requirement but not the age requirement may elect to receive an early retirement pension upon satisfying the age requirement. In addition, a Participant employed after September 30, 2011 who has completed 25 Years of Service (as defined in Section 8.06) may elect an early retirement pension. 6 9.16.11 The early retirement pension for a Participant is his or her Nonforfeitable Accrued Benefit payable at Normal Retirement Date without actuarial reduction for early commencement but only if benefits commence on or after the Participant attains age 55. Notwithstanding the above,the early retirement pension for a Participant as of September 30, 2011 who has received credit for 10 or more Years of Service but less than 15 Years of Service is the sum of his or her Nonforfeitable Accrued Benefit as of September 30, 2011 payable at Normal Retirement Date without actuarial reduction for early commencement plus his or her Accrued Benefit payable at Normal Retirement Date earned after September 30, 2011 with actuarial reduction for early commencement but only if benefits commence on or after the Participant attains age 55. If an eligible Participant elects to commence his early retirement pension prior to attaining age 55, such Participant's early retirement pension is the Actuarial Equivalent of his Nonforfeitable Accrued Benefit payable at age 55. Section 7. That Section 8.05 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 8.05 Vesting Schedule. (A) 100% Vesting Upon Certain Events. A Participant's Accrued Benefit is 100% Nonforfeitable upon and after his attaining Normal Retirement Age(if employed on or after that date). A Participant's Accrued Benefit is 100% Nonforfeitable if the Participant's separation from Service is a result of death, disability or eligibility for an early retirement pension. (B) 100%Vesting of Required Participant Contributions. Each Participant is immediately 100% vested with respect to his Required Participant Contributions. A Participant is entitled to receive a return of his Required Participant Contributions, contributed while a participant under the money purchase plan prior to October 1, 2000, upon termination of employment, together with simple interest at a rate equal to the interest rate on 30-year Treasury securities as published in the Internal Revenue Bulletin determined as of the calendar month preceding the first day of the Plan year, and effective October 1, 2003, a rate equal to the U.S. Treasury Department long-term average rate published on the last day of the calendar month preceding the first day of the Plan year, or such other rate that may be approved by the U.S. Treasury Department to replace the 30- year Treasury bond rate as a benchmark for calculating lump sum payouts from defined benefit plans, in lieu of any other benefit under the Plan. The amount received as a distribution by the Participant shall be used to reduce the accrued benefit, if any, at his normal retirement date. Required Participant contributions contributed on and after October 1, 2000 are 100%vested and shall be included in the deferred vested benefit payable to the Participant upon normal retirement date. 7 9.16.11 (C) Vesting Schedule prior to October 1, 2011. Subject to Section 8.05(A) and Section 8.05(B), a Participant's Nonforfeitable percentage in his Accrued Benefit equals the percentage in the following schedule: Nonforfeitable Years of Service Percentage Less than 3 None 3 20% 4 40% 5 60% 6 80% 7 or more 100% (D) Vesting Schedule effective October 1, 2011. Effective October 1, 2011, and subject to Section 8.05(A) and Section 8.05(B), a Participant's Nonforfeitable percentage in his Accrued Benefit equals the percentage in the following schedule: Nonforfeitable Years of Service Percentage Less than 7 None 7 or more 100% Notwithstanding anything herein to the contrary, the Accrued Benefit of a Participant with at least three (3) Years of Service on October 1, 2011 shall continue to vest in accordance with Section 8.05(C). Amendment to Vesting Schedule. Though the Employer reserves the right to amend the vesting schedule at any time, the Retirement Committee will not apply the amended vesting schedule to reduce the Nonforfeitable percentage of any Participant's Accrued Benefit derived from Employer contributions (determined as of the later of the date the Employer adopts the amendment, or the date the amendment becomes effective) to a percentage less than the Nonforfeitable percentage computed under the Plan without regard to the amendment. An amended vesting schedule will apply to a Participant only if the Participant receives credit for at least one Hour of Service after the new schedule becomes effective. If the Employer makes a permissible amendment to the vesting schedule, each Participant having at least 3 Years of Service with the Employer may elect to have the percentage of his Nonforfeitable Accrued Benefit computed under the Plan without regard to the amendment. The Participant must file his election with the Retirement Committee within 60 days of the latest of (1) the Employer's adoption of the amendment; (2) the effective date of the amendment; or (3) his receipt of a copy of the amendment. The Retirement Committee, as soon as practicable, must forward a true copy of any amendment to the vesting schedule to each affected Participant, 8 9.16.11 together with an explanation of the effect of the amendment, the appropriate form upon which the Participant may make an election to remain under the vesting schedule provided under the Plan prior to the amendment and notice of the time within which the Participant must make an election to remain under the prior vesting schedule. The vesting schedule election does not apply to a Participant if the amended vesting schedule provides for vesting at least as rapid at all times as the vesting schedule in effect prior to the amendment. (E) Forfeiture for Cause. The Plan does not permit a forfeiture for cause. Section 8. That Article VIII, Section 8.08 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 8.08 Included Years of Service - Vesting. For purposes of determining "Years of Service" under Section 8.06, the Plan takes into account all Years of Qualified Service credited to a Participant pursuant to Section 5.02(B) and all Years of Service an Employee completes with the Employer except: (A) Any Year of Service completed before a Break in Service, unless the Employee completes a Year of Service after the Break in Service. This Break in Service rule will not operate to recredit any Year of Service disregarded under clause(B). (B) Any Year of Service completed before a Break in Service if the number of the Participant's consecutive Breaks in Service equals of exceeds the greater of 5 or the aggregate number of the Years of Service prior to the Break. This Break in Service rule applies only if the Participant is 0%vested in his Accrued Benefit derived from Employer contributions at the time he has a Break in Service. Furthermore, the aggregate number of Years of Service before a Break in Service does not include any Years of Service not required to be taken into account under this exception by reason of any prior Break in Service. If the Retirement Committee Retirement Committee disregards the Participant's Years of Service under this exception, the Plan forfeits his pre-Break in Service Accrued Benefit. (C) Any Year of Service before the Plan Year in which the Participant attained the age of 18. (D) Any period of employment with the City during which the Employee participated in the defined contribution plan established pursuant to Resolution 2011-52. Section 9. That this resolution shall supersede any and all conflicting provisions of any previously adopted resolutions. 9 9.16.11 Section 9. That should any section or provision of this resolution or any portion thereof, any paragraph,sentence,or word be declared by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remainder hereof as a whole or part thereof other than the part declared to be invalid. Section 10. That this resolution shall take effect upon adoption. PASSED and ADOPTED this 24th day of October,2011. M.e!' A E` : ' Mir r' rERK • 10 RESOLUTION NO. 2011 -57 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, FLORIDA, AMENDING THE DEFINED BENEFIT PLAN AND TRUST FOR EMPLOYEES OF THE CITY OF WINTER SPRINGS; AMENDING ARTICLE I OF THE DEFINED BENEFIT PLAN TO REVISE THE DEFINITION OF "PLAN COMPENSATION" AND CREATE NEW DEFINITIONS OF "FORENSIC PROFESSIONAL", "GENERAL EMPLOYEE", "FIREFIGHTER" AND "POLICE OFFICER"; AMENDING ARTICLE II OF THE DEFINED BENEFIT PLAN TO REVISE THE ELIGIBILTY PROVISION AND CLARIFY THE REEMPLOYMENT PROVISION; AMENDING ARTICLE IV OF THE DEFINED BENEFIT PLAN TO CLARIFY THE NORMAL RETIREMENT PROVISION; AMENDING ARTICLE VI OF THE DEFINED BENEFIT PLAN TO MODIFY THE ELIGIBILITY REQUIREMENTS FOR AN EARLY RETIREMENT PENSION; AMENDING ARTICLE VIII OF THE DEFINED BENEFIT PLAN TO MODIFY THE FORFEITURE FOR CAUSE PROVISION; PROVIDING FOR CONFLICTS; PROVIDING FOR SEVERABILITY; PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Commission of the City of Winter Springs has determined that certain changes to the City's Defined Benefit Plan and Trust are in the best interest of the City, its employees and taxpayers; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, FLORIDA: Section 1. That Article I, Section 1.10 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 1.10 Compensation Definitions. Any reference in this Plan to Compensation is a reference to the definition in this Section 1.10, unless the Plan reference specifies a modification to this definition. The Retirement Committee will take into account only Compensation actually paid for the relevant period. (A) Total Compensation. "Total Compensation" means wages, salaries, and other amounts received (whether or not paid in cash) for personal services actually rendered in the course of employment with the Employer, but only to the extent included in gross income. This definition 1 includes,but is not limited to commissions, overtime pay and bonuses. With respect to the Plan Years beginning prior to October 1, 1998, Total Compensation does not include elective contributions. With respect to Plan Years beginning on and after October 1, 1998, Total Compensation includes elective contributions. Total Compensation also does not include: (1) Employer contributions to a plan of deferred compensation to the extent the contributions are not included in the gross income of the Employee for the taxable year in which contributed, on behalf of an Employee to a Simplified Employee Pension Plan to the extent such contributions are excludible from the Employee's gross income, and any distributions from a plan of deferred compensation, regardless of whether such amounts are includible in the gross income of the Employee when distributed. (2) Other amounts which receive special tax benefits, such as premiums for group term life insurance (but only to the extent that the premiums are not includible in the gross income of the Employee), or contributions made by an Employer towards the purchase of an annuity contract described in Code §403(b) (whether or not the contributions are excludible from the gross income of the Employee). (B) Plan Compensation. Plan Compensation means Total Compensation described in Section 1.10(A), except that Plan Compensation includes elective contributions for all Plan Years. Plan Compensation applies to determine a Participant's benefit formula and Accrued Benefit under Article V. Effective October 10, 2011, Plan Compensation means base salary plus incentive pay and up to one hundred fifty (150) hours of overtime pay in a Plan Year. For the purpose of this definition, overtime pay means: pay for hours worked in excess of 80 hours in a two-week work period for general employees; hours worked in excess of 84 hours in a two-week work period for police officers; and hours worked in excess of 56 hours in a one-week work period for firefighters. In addition, Plan Compensation shall include payment for accrued vacation leave earned prior to July 1, 2011. All other payments shall be excluded from Plan compensation. 1.26 "Forensic professional" means an Employee who spends at least 65 percent of his or her time performing duties that involve the collection, examination, preservation, documentation, preparation, or analysis of human tissues or fluids or physical evidence having potential biological, chemical, or radiological hazard or contamination, or use chemicals, processes, or materials that may have carcinogenic or health-damaging properties in the analysis of such evidence. 1.27 "General Employee"means an Employee who is not a sworn police officer, firefighter or forensic professional. 1.28 "Firefighter" means a former Employee who was employed solely by the fire department of the City of Winter Springs, who is certified as a firefighter as a condition of employment and whose duty it is to extinguish fires, to protect life, or to protect property. A Firefighter includes all certified, supervisory, and command personnel whose duties include, in whole or in part, the supervision, training, guidance, and management responsibilities of full-time firefighters, part- time firefighters, or auxiliary firefighters. A participating Firefighter is a former City Firefighter covered under the Agreement between the City of Winter Springs and Seminole County for Fire 2 and Emergency Medical Services, who elected to continue participating in the Defined Benefit Plan and Trust for Employees of the City of Winter Springs. 1.29 "Police Officer" means any person who is elected, appointed, or employed full time by the City of Winter Springs, who is certified or required to be certified as a law enforcement officer in compliance with s. 943.1395, who is vested with authority to bear arms and make arrests, and whose primary responsibility is the prevention and detection of crime or the enforcement of the penal, criminal, traffic, or highway laws of the state. This definition includes all certified supervisory and command personnel whose duties include, in whole or in part, the supervision, training, guidance, and management responsibilities of full-time law enforcement officers, part-time law enforcement officers, or auxiliary law enforcement officers, but does not include part-time law enforcement officers or auxiliary law enforcement officers as the same are defined in s. 943.10(6) and(8),respectively. Section 2. That Article II, Section 2.01 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 2.01 Eligibility. Each Employee (other than an Excluded Employee) becomes a Participant in the Plan on the first day of the month(if employed on that date) immediately following the date 6 months after his Employment Commencement Date. "Employment Commencement Date" means the date on which the Employee first performs an Hour of Service for the Employer. Notwithstanding any other provision of this Plan any Employee other than a sworn police officer or forensic professional hired on or after October 1, 2011 shall not be eligible to participate in this Plan. Any Employee other than a sworn police officer or forensic professional hired on or after October 1, 2011 shall participate in the defined contribution plan established pursuant to Resolution 2011-59 if eligible to participate in the defined contribution plan. Employees hired as sworn police officers or forensic professionals on or after October 1, 2011 shall participate in this Plan. (A) Excluded Employee (1) An Employee is an Excluded Employee if his customary weekly employment with the Employer is less than 29 hours. An Employee is an Excluded Employee if he is actively participating (and "benefiting" within the meaning of Treas. Reg. § 1.410(b)-3) in another qualified plan maintained by the Employer other than the Money Purchase Pension Plan and Trust for Employees of the City of Winter Springs, Florida (hereinafter referred to as the"Money Purchase Plan"). (2) If a Participant has not incurred a Separation from Service but becomes an Excluded Employee, then during the period such a Participant is an Excluded Employee, the Participant will not accrue a benefit under the Plan attributable to any period during which he is an Excluded Employee. However, during such period of exclusion, the 3 Participant, without regard to employment classification, continues to receive credit for vesting under Article VIII for each included Year of Service. (3) If an Excluded Employee who is not a Participant becomes eligible to participate in the Plan by reason of a change in employment classification, he will participate in the Plan immediately if he has satisfied the eligibility conditions of Section 2.01 and would have been a Participant had he not been an Excluded Employee during his period of Service. Furthermore, the Plan takes into account all of the Participant's included Years of Service with the Employer as an Excluded Employee for purposes of vesting credit under Article VIII. (B) Employees with Non-Contributing Service. Any Employee who completed Years of Service prior to adoption of Resolution No. 2003-44,but did not make contributions to this Trust Fund or to the Money Purchase Plan, shall be credited with Years of Accrual Service upon payment of the Required Participant Contributions due under this Plan and the required participant contributions due under the Money Purchase Plan for such service. Section 3. That Article II, Section 2.03 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 2.03 Participation upon Re-employment. A Participant whose employment terminates and who is subsequently reemployed prior to October 1, 2011 will reenter the Plan as a Participant on the date of his reemployment. An Employee other than a sworn police officer or forensic professional who satisfies the Plan eligibility conditions and who is subsequently reemployed on or after October 1, 2011 shall not participate in this Plan but will upon reemployment participate in the defined contribution plan established pursuant to Resolution 2011-59 in accordance with the terms and conditions therein provided. Any Employee other than a sworn police officer or forensic professional who terminates employment prior to satisfying the Plan eligibility conditions and who is subsequently reemployed on or after October 1, 2011 shall not participate in this Plan but will upon reemployment participate in the defined contribution plan established pursuant to Resolution 2011-59 in accordance with the terms and conditions therein provided. A Participant employed as a police officer or forensic professional whose employment terminates and who is subsequently reemployed on or after October 1, 2011 will reenter the Plan as a Participant on the date of his reemployment. An Employee employed as a police officer or forensic professional who satisfies the Plan's eligibility conditions but who terminates employment with the Employer prior to becoming a Participant and who is subsequently reemployed on or after October 1, 2011, will become a Participant on the later of the Plan Entry Date on which he would have entered the Plan had he not terminated employment or the date of his reemployment. An Employee employed as a police officer or forensic professional who terminates employment prior to satisfying the Plan eligibility conditions and who is subsequently reemployed on or after October 1, 2011 becomes a Participant in accordance with the provisions of Section 2. 4 Section 4. That Article V, Section 5.02 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 5.02 Amount of Normal Retirement Pension/Accrued Benefit. The Annual Benefit limitations of Article III apply to the determination of a Participant's normal retirement pension and Accrued Benefit in the manner prescribed in Section 3.05(H). (A) Normal Retirement Pension. (1) Benefit Formula (a) A Participant's normal retirement pension equals 2% of the Participant's Average Final Compensation multiplied by his Years of Accrual Service for service prior to October 1, 2000, and 3% of the Participant's Average Final Compensation multiplied by his Years of Accrual Service for service on and after October 1, 2000. Such pension will be adjusted for any distribution in accordance with Section 8.05. The maximum number of Years of Accrual Service taken into account in the normal retirement pension is 30, counting forward from the date of initial participation to include any purchased past service. (b) Notwithstanding any provision of subparagraph (a) to the contrary, effective October 1, 2008, a Participant's normal retirement pension shall equal 3%of the Participant's Average Final Compensation multiplied by his Years of Accrual service for service prior to October 1, 2000; provided that such multiplier shall increase by one- fourth of one percent(.25%) each year beginning October 1, 2005 as follows: Multiplier for Service Effective Date Prior to October 1, 2000 October 1, 2005 2.25% October 1, 2006 2.50% October 1,2007 2.75% October 1, 2008 3.00% (c) A Participant's normal retirement pension shall be calculated by applying the multiplier for service prior to October 1, 2000 that is in effect on the date of the Participant's separation from service. (d) Effective October 10, 2011 the normal retirement pension of a General Employee Participant shall equal 3% of the Participant's Average Compensation multiplied by Years of Accrual Service prior to October 1, 2011, and 2.5% of the Participant's Average Compensation multiplied by Years of Accrual Service on and after 5 October 1, 2011. The normal retirement pension of a Participant employed as a sworn police officer, firefighter or forensic professional shall equal 3% of the participant's Average Compensation multiplied by Years of Accrual Service. Such pension will be adjusted for any distribution in accordance with Section 8.05. The maximum number of Years of Accrual Service taken into account in the normal retirement pension is 30, counting forward from the date of initial participation to include any purchased past service. (2) Average Compensation. Average Compensation is the average of the Participant's Plan Compensation for the Averaging Period in the Participant's Compensation History which results in the highest Average Compensation. A Participant's Compensation History is the Participant's entire period of employment with the Employer. The Averaging Period is 3 consecutive Compensation periods or the entire period of employment if shorter. Effective October 1, 2011, Average Compensation shall be the average of the highest five (5) consecutive years of Plan Compensation out of the ten (10) years immediately preceding termination of employment. A Compensation period is the 12 month period ending on the last day of the Plan Year. Notwithstanding the above, a Participant's Average Compensation shall not be less than his or her Average Compensation as of September 30,2011. * * * Section 5. That Article VI, Section 6.01 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 6.01 Eligibility for Early Retirement Pension. A Participant as of September 30, 2011 who has received credit for at least 10 Years of Service (as defined in Section 8.06) and has attained age 55 may elect an early retirement pension. A Participant as of September 30, 2011 who separates from service after satisfying the service requirement but not the age requirement may elect to receive an early retirement pension upon satisfying the age requirement. In addition, a Participant as of September 30, 2011 who has completed 25 or more Years of Service(as defined in Section 8.06)may elect an early retirement pension. A Participant hired after September 30, 2011 who has received credit for at least 15 Years of Service (as defined in Section 8.06), and has attained age 55 may elect an early retirement pension. A Participant hired after September 30, 2011 who separates from service after satisfying the service requirement but not the age requirement may elect to receive an early retirement pension upon satisfying the age requirement. In addition, a Participant hired after September 30, 2011 who completes 25 Years of Service(as defined in Section 8.06)may elect to receive an early retirement pension. The early retirement pension for a Participant is his or her Nonforfeitable Accrued Benefit payable at Normal Retirement Date without actuarial reduction for early commencement but 6 only if benefits commence on or after the Participant attains age 55. If an eligible Participant elects to commence his or her early retirement pension prior to attaining age 55, such Participant's early retirement pension is the Actuarial Equivalent of his Nonforfeitable Accrued Benefit payable at 55. Notwithstanding the above, the early retirement pension for a Participant as of September 30, 2011 who has received credit for 10 or more Years of Service but less than 15 Years of Service is the sum of his or her Nonforfeitable Accrued Benefit as of September 30, 2011 payable at Normal Retirement Date without actuarial reduction for early commencement plus his or her Accrued Benefit payable at Normal Retirement Date earned after September 30, 2011 with actuarial reduction for early commencement. Section 6. That Section 8.05 of the Defined Benefit Plan and Trust for Employees of the City of Winter Springs be amended as follows: 8.05 Vesting Schedule. (A) 100% Vesting Upon Certain Events. A Participant's Accrued Benefit is 100% Nonforfeitable upon and after his attaining Normal Retirement Age (if employed on or after that date). A Participant's Accrued Benefit is 100% Nonforfeitable if the Participant's separation from Service is a result of death, disability or eligibility for an early retirement pension. (B) 100%Vesting of Required Participant Contributions. Each Participant is immediately 100% vested with respect to his Required Participant Contributions. A Participant is entitled to receive a return of his Required Participant Contributions, contributed while a participant under the money purchase plan prior to October 1, 2000, upon termination of employment, together with simple interest at a rate equal to the interest rate on 30-year Treasury securities as published in the Internal Revenue Bulletin determined as of the calendar month preceding the first day of the Plan year, and effective October 1, 2003, a rate equal to the U.S. Treasury Department long-term average rate published on the last day of the calendar month preceding the first day of the Plan year, or such other rate that may be approved by the U.S. Treasury Department to replace the 30- year Treasury bond rate as a benchmark for calculating lump sum payouts from defined benefit plans, in lieu of any other benefit under the Plan. The amount received as a distribution by the Participant shall be used to reduce the accrued benefit, if any, at his normal retirement date. Required Participant contributions contributed on and after October 1, 2000 are 100%vested and shall be included in the deferred vested benefit payable to the Participant upon normal retirement date. (C) Vesting Schedule prior to October 1, 2011. Subject to Section 8.05(A) and Section 8.05(B), a Participant's Nonforfeitable percentage in his Accrued Benefit equals the percentage in the following schedule: 7 Nonforfeitable Years of Service Percentage Less than 3 None 3 20% 4 40% 5 60% 6 80% 7 or more 100% (D) Vesting Schedule effective October 1, 2011. Effective October 1, 2011, and subject to Section 8.05(A) and Section 8.05(B), a Participant's Nonforfeitable percentage in his Accrued Benefit equals the percentage in the following schedule: Nonforfeitable Years of Service Percentage Less than 7 None 7 or more 100% Notwithstanding any provision of this section 8.05 to the contrary, the Accrued Benefit of a Participant on September 30, 2011 shall continue to vest in accordance with Section 8.05(C). (E) Amendment to Vesting Schedule. Though the Employer reserves the right to amend the vesting schedule at any time, the Retirement Committee will not apply the amended vesting schedule to reduce the Nonforfeitable percentage of any Participant's Accrued Benefit derived from Employer contributions (determined as of the later of the date the Employer adopts the amendment, or the date the amendment becomes effective) to a percentage less than the Nonforfeitable percentage computed under the Plan without regard to the amendment. An amended vesting schedule will apply to a Participant only if the Participant receives credit for at least one Hour of Service after the new schedule becomes effective. (F) If the Employer makes a permissible amendment to the vesting schedule, each Participant having at least 3 Years of Service with the Employer may elect to have the percentage of his Nonforfeitable Accrued Benefit computed under the Plan without regard to the amendment. The Participant must file his election with the Retirement Committee within 60 days of the latest of (1) the Employer's adoption of the amendment; (2) the effective date of the amendment; or (3) his receipt of a copy of the amendment. The Retirement Committee, as soon as practicable, must forward a true copy of any amendment to the vesting schedule to each affected Participant, together with an explanation of the effect of the amendment, the appropriate form upon which the Participant may make an election to remain under the vesting schedule provided under the Plan prior to the amendment and notice of the time within which the Participant must make an election to remain under the prior vesting schedule. The vesting schedule election does not apply 8 to a Participant if the amended vesting schedule provides for vesting at least as rapid at all times as the vesting schedule in effect prior to the amendment. (G) Forfeiture for Cause. The Plan does not permit a forfeiture for cause_except as provided in section 112.3173,Florida Statutes, as currently enacted and as amended in the future. Section 7. That this resolution shall supersede any and all conflicting provisions of any previously adopted resolutions. Section 8. That should any section or provision of this resolution or any portion thereof, any paragraph, sentence, or word be declared by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remainder hereof as a whole or part thereof other than the part declared to be invalid. Section 9. That this resolution shall take effect upon adoption. PASSED and ADOPTED this 12th day of December, 2011. MAYSR ATTEST: i 11,,,. 9 City of Winter Springs Defined Benefit Plan Actuarial Impact Statement as of October 1,2010 A. Description of Ordinances 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, 2011 for all members. Base plan compensation excludes commissions, bonuses and overtime pay in excess of one hundred and fifty (150) hours per year. FAS under the proposed change will not be reduced below FAS as of September 30, 2011. Vesting schedule for future benefit accruals is seven (7) year cliff vesting schedule for all members. Under this schedule, members are not vested until completion of seven (7) years of service. Upon completion of seven (7)years of service members are fully vested. Accrued benefits as of September 30, 2011 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 fully vested upon completion of seven(7) years of service. Unreduced early retirement eligibility for all members is the earlier of(a) attainment of age fifty-five (55) with completion of fifteen(15)years of service or(b) completion of 25 years of service regardless of age. Accrued benefits as of September 30, 2011 remain payable unreduced upon the earlier of(a) attainment of age fifty-five (55)with completion of ten(10) years of service or (b) completion of 25 years of service regardless of age. Benefit accrual rate for General Employees is two and a half percent (2.5%) per year of credited service after September 30, 2011 - maximum thirty (30) years of total service. Credited service earned through September 30, 2011 will retain the current three percent(3%)benefit accrual rate. Participant contribution rate for all members is five percent (5%) beginning with fiscal year ending September 30, 2012. Close the Plan to future General Employees. Gabriel Roeder Smith 8c Company City of Winter Springs Defined Benefit Plan Actuarial Impact Statement as of October 1,2010 B. An estimate of the cost of implementing the ordinances (see attachments). C. In my opinion, the proposed changes are in compliance with Part VII, Chapter 112, Florida Statutes and Section 14, Article X of the State Constitution. Chairman, Retirement Committee Date Gabriel Roeder Smith & Company City of Winter Springs Defined Benefit Plan Actuarial Impact Statement as of October 1,2010 Actuarial Amended A. Participant Data Valuation Ordinance 1. Active participants 210 210 2. Retired participants and beneficiaries receiving benefits 51 51 3. Disabled participants receiving benefits 0 0 4. Terminated vested participants 98 98 5. Annual payroll of active participants $ 10,304,054 $ 10,304,054 6. Annual benefits payable to those currently receiving benefits $ 1,004,823 $ 1,004,823 B. Assets 1. Actuarial value $ 23,887,446 $ 23,887,446 2. Market value $ 21,017,997 $ 21,017,997 C. Liabilities 1. Actuarial present value of future expected benefit payments for active members a. Retirement benefits $ 32,318,747 $ 28,698,436 b. Vesting benefits 2,778,467 2,493,728 c. Death benefits 972,590 911,872 d. Disability benefits 1,118,943 1,053,107 e. Total $ 37,188,747 $ 33,157,143 2. Actuarial present value of future expected benefit payments for terminated vested members $ 2,994,167 $ 2,994,167 3. Actuarial present value of future expected benefit payments for those currently receiving benefits a. Service retired(includes DROPs) $ 9,015,908 $ 9,015,908 b. Disability retired 0 0 c. Beneficiaries 1,483,443 1,483,443 d. Miscellaneous(refunds in process) 14,732 14,732 e. Total $ 10,514,083 $ 10,514,083 4. Total actuarial present value of future expected benefit payments $ 50,696,997 $ 46,665,393 5. Actuarial accrued liabilities(EAN) $ 40,331,447 $ 37,306,569 6. Unfunded actuarial accrued liability(EAN) $ 16,444,001 $ 13,419,123 -1- Gabriel Roeder Smith & Company City of Winter Springs Defined Benefit Plan Actuarial Impact Statement as of October 1,2010 Actuarial Amended D. Statement of Accumulated Plan Benefits Valuation Ordinance 1. Actuarial present value of accumulated vested benefits a. Participants currently receiving benefits $ 10,499,351 $ 10,499,351 b. Other participants 21,436,015 21,436,015 c. Total $ 31,935,366 $ 31,935,366 2. Actuarial present value of accumulated non-vested plan benefits 427,010 427,010 3. Total actuarial present value of accumulated plan benefits $ 32,362,376 $ 32,362,376 E. Pension Cost 1. Total normal cost $ 1,355,080 $ 1,214,232 2. Payment required to amortize unfunded liability 1,405,371 1,156,582 3. Interest 131,334 110,086 4. Total required contributions $ 2,891,785 $ 2,480,900 5. Item 4 as a percentage of payroll 28.1% 24.1% 6. Estimated employee contributions $ 274,861 $ 515,203 7. Item 6 as a percentage of payroll 2.7% 5.0% 8. Net amount payable by County and City $ 2,616,924 $ 1,965,697 9. Item 8 as a percentage of payroll 25.4% 19.1% F. Disclosure of Following Items: 1. Actuarial present value of future salaries-attained age $ 90,841,906 $ 93,021,385 2. Actuarial present value of future employee contributions -attained age $ 2,321,534 $ 4,651,069 3. Actuarial present value of future contributions from other sources N/A N/A 4. Amount of active members'accumulated contributions $ 2,234,009 $ 2,234,009 5. Actuarial present value of future salaries and future benefits at entry age N/A N/A 6. Actuarial present value of future employee contributions at entry age N/A N/A -2- Gabriel Roeder Smith & Company • City of Winter Springs Defined Benefit Plan Actuarial Impact Statement as of October 1,2010 G. Amortization of Unfunded Actuarial Accrued Liability Remaining Unfunded Amortization Funding Unfunded Actuarial Accrued Liabilities Liability Payment Period 10/01/2000 Initial $ 2,250,045 $ 212,196 20 years 10/01/2002 Assumption Change (28,677) (2,603) 22 years 10/01/2003 Plan Amendment 180,807 16,142 23 years 10/01/2004 Plan Amendment 273,310 24,036 24 years 10/01/2005 Plan Amendment 564,770 48,988 25 years 10/01/2006 Plan Amendment 648,009 55,505 26 years 10/01/2007 Plan Amendment 661,626 56,023 27 years 10/01/2008 Plan Amendment and Assumption Change 2,963,908 248,334 28 years 10/01/2008 Method Change 6,624,771 555,063 28 years 10/01/2009 Actuarial Loss(Gain) 2,827,164 234,598 29 years 10/01/2010 Actuarial Loss(Gain) (521,732) (42,911) 30 years 10/01/2010 Ordinance (3,024,878) (248,789) 30 years TOTAL $ 13,419,123 $ 1,156,582 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 otherwise taken into account for in the valuation. All known events or trends which may require a material increase in plan costs or required contribution rates have been taken into account in the valuation. Enrollment Number: 11-02802 Lawrence F. Wilson,A.S.A. Dated: March 2,2012 -3- Gabriel Roeder Smith & Company J 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 2011-57 adopted December 12, 2011. B. Eligibility Requirements General Employees hired prior to October 1, 2011, Police Officers and Forensic Professionals 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 Years during which an Employee completes at least 1,000 hours of service, including years of service completed prior to participation in the Plan. D. Compensation Wages, salaries and other amounts received (whether or not paid in cash) for personal services actually rendered in the course of employment. Effective October 10, 2011 Compensation shall exclude commissions, bonuses, overtime pay in excess of one hundred fifty (150) hours per Plan year and payments for accrued leave in excess of the dollar amount of an Employee's accrued leave balance on July 1, 2011. E. Final Average Compensation Average earnings during the best five (5) consecutive years out of the last ten(10)years preceding termination or retirement, but not less than the three (3) highest consecutive compensation periods during employment with the City as of September 30, 2011. 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. -4- Gabriel Roeder Smith 8c Company City of Winter Springs Defined Benefit Plan Outline of Principal Provisions of the Retirement Plan 2. Benefit: For Firefighters, Police Officers and Forensic Professionals, 3.00% times Final Average Compensation multiplied by Accrual Service, up to a maximum of 30 years. For General Employees, 3.00% times Accrual Service earned through September 30, 2011 times Final Average Compensation plus 2.50% times Accrual Service earned after September 30, 2011 times Final Average Compensation, up to a maximum of 30 years of Accrual Service. G. Early Retirement 1. Eligibility: (a) Attainment of age 55 and completion of 15 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. 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. 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: Accrued benefit calculated as for Normal Retirement based upon service and pay at Disability Retirement Date. -5- Gabriel Roeder Smith & Company City of Winter Springs Defined Benefit Plan Outline of Principal Provisions of the Retirement Plan 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. K. Participant Contributions Five percent(5%) of compensation for all employees. 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. 3 Y izqq�.yyS �y>�'sggw+'6p F h-3jk; pc& #.iyi {S • tnE�m. $ t ^`y. /�"Kp g`9 s{t'`. �Js°ed � '' �''' -ab'•`T 't' M. Normal Form of Payment 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. N. Changes Since Previous Valuation 1. Employees working 30 or more hours per week were eligible to join the Plan on the first day of the month following completion of six (6)months of service. 2. Compensation was defined as wages, salaries and other amounts received (whether or not paid in cash) for personal services actually rendered in the course of employment including but not limited to commissions, overtime pay and bonuses. -6- Gabriel Roeder Smith &Company • City of Winter Springs Defined Benefit Plan Outline of Principal Provisions of the Retirement Plan N. Changes Since Previous Valuation (continued) 3. Final average compensation was the average earnings during the three (3) highest consecutive compensation periods during employment with the City. 4. Accrued benefit was 3.00% times Final Average Compensation multiplied by Accrual Service, up to a maximum of 30 years. 5. Early retirement eligibility was the earlier of attainment of age 55 and completion of ten (10) years of service or completion of 25 years of service. 6. Participant contributions were three percent (3%) of compensation for General Employees and Police Officers and zero percent(0%) for Firefighters. 7. Vesting schedule was: :3 Ye s'of rvice':A..: steel Pierce tage'' z•3t,nv M}.. y;Y;q. �q`4>a� �\�. �S%,4 4a•im>�::''` '° `'k° 5c: <t,,�Y � �'„ •k Abe_ n ,.�f•• , .t.. �aw'..� ,z, .Sre..5 1.aY`="s",.:e.?} �':4:^5•e n^ "t r t Na •, -7- Gabriel Roeder Smith & Company J 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 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. V144 44.0;let' sue.*F3 , iu .: e ," s F#. AlAt .#;A i �'`!!' `*• `.�r s�° '' `' 4�j::5' a ,., ' : .0441444- s ' " �;, _g- Gabriel Roeder Smith& Company City 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: .. ;. '. t1:;a� „tip =-'s 'i e h>4:-.�,..':;, ;: _:� � -", ,..` ildA>r a Wa al;.R aW, 3::5.,r'z J' g n3. � '� ; ` �- ' N , l?4t ✓w .�%57'rc5'ri + •:� .%;c��:' 2� :ga.,; # ;€^a4.3,.s3<� '4= ' 4 .b` . n . . � 1 �,. ; 'k5ti Y^;` < fi. c 51: �«` F e ° ,4`., '' ` 95fi.=�1 �' F>k ari E.qi: .si;�,qH:'"Q eigg,'V. y3 .0,, , f \r4 4 ; ''' t°t<�„ s °,.,g E:„_; ' x•`' ,xx'a.�•z}3 °::..,n ° "':i'X��' •d k as '7,:p,` ' `-"`' i� -z ' i, ":, i•: ' � `�'r � �' : •. .a �A» A, '.'':fix-,,,^. .' i�§ , �_:•�1k�-;� .�;p�a�„� 8� ._ <ar'£' - '" 421t:1i y , 0 3 3 rr;p;gip. r , �. .^,rv,.-; y 5 5 3 , [e ' M ' .2-9 '1 A 2 -----r-:-. , d ta ,` P i,=%r��'' a fl.tk r,�� ;. �.=;.,:"` -::.*+ � 4'i:=':' r "' ;R.,. :. ' ,f :n*i„. '�:¢�.;: _ : `,'s a e a�g A,a0 '. .3;";, t-' - . 4=21: xl ', 12 ` ; ' Ti!'"C. 5: = ' 5.2 ' °_ 3'1 2;r '' <?.' :�4.:1K: °av, -:L-;,:? =':a' .a °' r:,;r•,,,y .: -�x:;• , ,k;' _ ..�• ` , ;tn "'i z .4.� . -`1' .'• i-'r, ,6,1-,-„,,:x-: ; L 9 s x, 2 ''"c`tTr i"2,;�, vv•amt• :•n ;,:e. °:s;,r ^ ° _. 7;0: •� .: 3r3ro ,r i �£, V tr G; "�' .r'e.:ri ",'i L r° sg:'4' : x ^ ±.. . r , _ :c'"_''a�`'*.i..t. "r'y; .< x`�• +'.e...: :a,.- ^�-'-'t;._�''; .•e .`3:: •:#- "'::ref •"; .<?I ° `t";=e;< -�^-_: ra<`',�'.':�Y�^x.ri ,�„•: ."ae;p°� ,c,i „g�L '°�'°"`.,,;,, ,r -:;�:� ',��ap,y� .ate :�"�3� •:,�x`_� _ r-✓'-<' } `:. £ uy INI.1 .: .q %:G:°A,?,t '^X '-',i"-, Y,,:'O ro':#.s .',"1:: •'$.b°.7,: . ;'i;'4:,, 7g.,t�..k' :TC«".' -X� ,.�:}}�•..$, '.3'?�<« .:,� d: eta _ :q: °T': ,q, ».• _, ..yaa '. v...l�. -.3" frn �=;r 'Ov J %;'y e :%.:s..-;y.ts.y,,, a ;,n4 .: 2116 ; ,, ll Q 55* 4. ' _" ..3. ' w _ 6�";,-1.11'''.". :"1 : , r ,,4, i "�' w Tom' x'"a rif �,. ';t, •'3�:: a'% ,;,», •:--Wi,,,,a .:•;;,-f.:;1;',� . 211.64 :15:5-4:4., �5�x ..3`�, .5 O% 3.$,, - '36 �a', 3.1' as -;49"v---q!"...' -,;,4. -7.0 y a 4 u -.4.R r?= _':�p--,:i„11-' "- £«:, ,�nri,, .4t.: r,,, ,,.,d,,,a :.;.,,=,=y;z•; a" !��ry.,,, ,,,,, y o4:^�a ;" ,,,,r=: : R, "� •:4," "4; `6§' 5 k j,"32A a>'' ,''s, Tg r'1 ,..,s,.�n'- -F; '4e 7.^- ' x"4'V B ;1.3 .3:Z a'",>r*.a 3:1:«.:k:<¢,< ,2. `'.. :''d 69 F: .424.4,1'•'4#!' !��" � aq'L'yj+.7.J);.. Yn° dP�--k A >A .,f�'�' 2 �_ _ �'F • V".i3 A,;•'fi�� :;1'• '"�" %r., kw; 5. to 2tl. 5,� _,"4; .�` 4.7= _4: :13 '' 3.2 >` 3 • ,°2.9 • ,-• 1,24::= _ ;1 4. Withdrawal rates for female Firefighters and Police Officers were used in accordance with the following illustrative example: tv U, .; ' ,)7�e.;q ,'3r:ia ;„ '.,.'�,Wi thd wwall,Rates'pt., r lO m ilo'y..ee . .. -.�..r, Atg v-ii---.' :. - $14 , , { " a - £ ' , . .:: I£K:, ,!- " . .• #. ' , ,, 'x,g ,. . f,,,, .,.,„ 4s 4. r" �fGt"'3 . 4/k" . : Y " . y . : t, k t ,:' °. 4 • i •8' ''t• i F• 4. B, >'' ✓ : ,;. ' - 'tr' 'a ru. . i d r '' r ��, ` �- ,.p>a ,� `3.�'''k �'.:�:;°w'!�,t,�' !2 @= �.•z��x4.. ,"�r��-'A- :)g;-.ti,< 6•.,:xo<� is �'st.-: �-5k ,�s�: ..�»a3r�r-°,�'t�� ,..1°.. :.::.A "3;,,,;, r1-4,jj';-: y.1t,`6i ' `-i9;$;�. 9,2 b 1 9 s,,., 5 0 =4:4 2 x,2s uy' 's N' `�FF �-�'�" 6'-'• . }c }x�°� _-s��` '� �] ,°,, �!-.. .ti'Sc: :Fl.`.L[$ ''C l"•� .t- :Sa ;. 2 `'%`.f;' ' = ," _3 -2".• ,t.d,: u°=16:'14.47-,"-`k.7 H'-". °`.5.V- ,`:" ., { 4�•,�J ' t3� b { £:,ift t`rt?;z, .r'?`t *� ...;'-...;--4,,,••, . . -,'?'7',QaH::•,-1.4,-v,'.: ?4 N,,c;' �'ar 0, '%zt `-y <• ,"'7 :4ff'f -':, a r � :0"5s, -..P•,e,.< tea{,., ! ., :.z. ??'s C1� ',,,,1'4;.ii.2!L'..3 < $s.1 4 . x�g ze }.?:3,,t°`n , t7' ^w; ." Fx'a7 i:`,: >)-,0 % .,,,,-.4:x..-;,:-:,':.,,,-4:,44,-„,„1.-,,,,,,:--: rys, ' : t�. ,c:'P:'&�4.; ,T.f a E•-•tV:-,,. : .'•',s1:;,w ws "y'<s..«",▪..;r' -' " ;:�; : :;'Z `, y ,A,.. 72`I?: , 12�, £; , City of Winter Springs Defined Benefit Plan Actuarial Assumptions and Actuarial Cost Methods Used in the Valuation F. Disability Rates 1. Line-of-duty disability rates for General Employees were used in accordance with the following illustrative example. .�.«.".-'E:^e�.�.�}�f„Ty C4�;...`;,� A:'o„" ca,.A(. 'c.'atii ";.FwdC:'t".�. g, M1.A; A '4S : -'�' ?"' ce N.' p� yy 4,, `'trv ,rr`Lf„shy p '' < ; •i .. : } L );( 5:;;� d'i+" i n-e. ';��p3. r.£ � 'S.a=� :'�•;'.r•-: x p0' ' : ,..,',. 10 3 ' xIw0 : ;vY '. ., ' ”'? . -; y ms } � iii-,-, 'zF' l 'F f Yx 0,, i- .. " . . s ¢ -rJ .�▪ § +�_ ,` s'p., rY.�r:;w,,�:n ;�� _ _cam.±- -,,,,.:!:.,,,,,,.,:,1.:. • it ,,� i-�r§'`"°ate d �at b�€'�' �' '. 'rs {`e�n��r�.yr�.s s , C f:l''> 44.4 " ;fit, ; t�7y,+V��ff ��. yyy :.. .i,• /�(y�o-:;FZas;�'Z O2'2C0-',.: }-'t' .,k=. `'pfE f-':',°,0%.1,,E•',.::e X { • : -, ,Y i„,f4 i i 2. Non-duty disability rates for General Employees were used in accordance with the following illustrative example. S;, E . ,'--,--,— ;14Y ` '_a Fi x 1 r • %.', ;°', e:41-.,,,,,,:;:,s 'Asa !}•' od:l' V',,,, ..,,s an d'^a•m�$ ., :, •fir:.c,,‘,g 1 ",, ,,�+a.;:;,. �,.':...a:,:i• P.w•`Z ., �'r��,gib•:.��,}'�yL''"��`'Ogi-`,�.'➢� E�k:rh"e`3'.:�:.±1� •.�'� �.•'�",;. .°:� � �Ta.m• • <• r `F �°„<{ �r. �� .._... yHp � ," � • .. .'.�`; � ``1 wi ir s y i, a f:' , < <: . °4 :w, . .o`; a Tri i''',.:::44,171' . 1,,1- sx t l{,,',.w" - f su fi S ,< 0 °916 ��. ' b ,,' = ,,,' ; , : • "£F gy °' � ` ,40:4,, " 94 "k � 55 ' „. y 20.., ^,.;: x•.,It ,O• _0.; � I 0:. fit ; • 0 ,, .a The disability assumptions are the disability assumptions used in the July 1, 2010 FRS Actuarial Valuation. -11- Gabriel Roeder Smith & Company • 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. £.'ate.e. X , ':2 '�^ix I # -, w , .a } .▪ . n ,X'v. a:',4,,,,, , �,,+ - Aga S vid .-rub'; `3': '.ty� - d �,.b b r fYs ,.-v'i '4r z A ��P<?.' „�.,-, `r"i ,-31,.`-�/� -o s ^r.a °:rz 3` : • ',mµ.-'',,:..,. 4,, `'�,c, " a,.. ,' ''.«.7,,--. 2,'5.---;,',`;:::::`,;:i;,... ,s.AN; ' 'r�,,h. .• ..,ad.''[:•'fie «p'�q.y.; `i:�b;' �,3' gD• a•''�0 EiF�rl�3yl�� 4"L"'. V gg{ •.6:4;;.1; !'" , ,> L 1 ?. y�46� �:y': rl:.S1"1i• ;�s,4i�' M "�"-.ss,•,'. �•Z`" ,.�.,�.''-,�.$Y;,.. ".y,�..a -c'Y'�;,?,.Y'.• j6._ 5--. r ,-h311 2.1:5% ;,„;n''- = • %a'`°'''.;,e,;:-;,1 4. Non-duty disability rates for Firefighters and Police Officers were used in accordance with the following illustrative example. yt,.� gb,.•' '4:1'''/.:t?', rk.f7?.l ;`” £ 9'',': eifia er ,, 42p %40.01 1 " F ;o 6%%ak a ",:',"?:`,4,1':,:1,t,4,,s,li,a :.ke' ..:','1.:0 'A1:30y '141,,01'="1 :• 1'.%611114:‘Vii1;''' & '7-;:mi. • s • i M',' ,▪ -f h r�t ` 93+ . S tea'_: `i . r n ; a _ : 444t The disability assumptions are the disability assumptions used in the July 1, 2010 FRS Actuarial Valuation. -12- Gabriel Roeder Smith Sc Company • City of Winter Springs • Defined Benefit Plan Actuarial Assumptions and Actuarial Cost Methods Used in the Valuation G. Assumed Retirement Age Retirement rates were used in accordance with the following tables. 1. For Police Officers and Firefighters: • fF3 '4 . ..:@ Y „s ` , 4 V ...: ? :._.m =µ;�...:`# - -S% : ,, `t..:,Lw,:` : ,x ,. ,,,I <. ., v. .r 2x „:„F -% • f9 �.r°5 �,.n .;,?,,4., .A-:4' ;.s w V R;a 7 U fl ;0: ;3��.,•5% • :q,4 : 3 7 ,,;i„,�: ; :`` ri;„.,', ' "Me.,,';,..5= >y;9 fir- t f a 4,; i,<°55 5rxrr ”` 0% c,- -,,,Y's z tO " g -z y 1.:5°79 g ' r�.,a j g� • fl ...< K �'"'F ..i-' 5 '4a ,?r' _-F°.-NNZ r. S_ t t wwz ;-; ;1 y.? b c.'., -1 yy��.�' y�'[�y 4"1:' .'�'� Q/'y _ y) Q fg�� x� Q . :� ,�y+��Q� , ^/fit ."i4: �r of 3 c":"2-."-$��q �!Q ��gg��'�-{� rk -`�,µ`T��V°"'.��"'4Y yam�„„ S }r�At-`4,.:,,,,,v 1 i�d�s Q.. .-'�q` Y, M <�''" ,•t `A °..L'',. ^',fg'.:+{_::.1z+ ';..,a,.. .'`4' 47g:,; 'i ', 76 T'eli.<. ' ,"1.4.°a j .'Y:, 65;anddabove` :'-.. "< OO%;'''x 1.00*.':v .rs,: • ',:• '00°f,''%%f'; yx . °�-, ,: -t' i .: .,r. 2. For General Employees: o-Yw ,xx..�� ` ,;v;i.. "5=a__°�tt�S:^. .. i .•.p: .�:i. ;, <f� _<s:."; .r`%;; _''V °:•?tip. S, b--?. N� ,,F--_`:y@,. - _°�� e41,,,-.,:-I:: "",•°, ��«:..j,Q=� '�: �:;:l�l'��1�:��: ,:;c--,.;,,:,::��='��`` .>x,.:_�'� �.?J<='3#1 ,p.�t`.`�<3:O�fl�r'wl'�tOI" ?x a a Syru 0� '- r $ ii 6 ° , , >.<..=• 7-x �'3q7 .. h �rksn; /*,-,'".« •„3'''''t' i '� �,4cr; "� .:444:" z'--'�3.` :�, �°' t£1..:a+f��. ��i• "� ,` ,�:;N;eT` s �=b;�t�,;.r.;�' >4^: :'.::"a��t�.•pa•,r•,' F_�� 'a„�s,'� °: 7a� •.,p��.� a` '<a`•',";:r 3 ,hit: a s }*Q + w��Q� ty€�< - �i H'v , a f d '�ff ',::',17:,d N^D=c..`gym ': � 13�%'- -.t�- .,�';"' ��'',� '��< `�K'x':S.r,�� z`�a�:» �.e w � _�”,r.:.'ta.,.3. - " �° N W;iS�r..din;^•'. £:w" '�:k? ;.,�,,�,ak>• t. "�,5�� ,.r,.' ��d . _€: J)� :,,i.<:x.T'`y�Lt-`i)j} <,�s^�.', 3d',. `g$'�+�,� ;, ;,a q's`s� °�r`i^:� ,.'s> x,i-f , t, '-° ..P r t� C5 f. ,,*--zr'.:,.` 1.9,v'„ w s3 T w-: ,r. %`%'v',N ., 361,,,;. ' .;:ys^; ,, ,y � ''O-fN. . . ; ;, :'-3;w' <r^• ``-.-tr.>�s 4 -" =_x 'yi �. s .,. ',.; ,;:;r '., ;.' ,C#31i.;'aV Y1+,, pp, u ''• O0 T. . r�., '1 �f�.. `x''�S c' %e :3�.i''Q`��3. 3""'< ' "a ;, t. 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. I. 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 - adjusted for equation of balance October 1, 2010. -13- Gabriel Roeder Smith & Company 4 City of Winter Springs Defined Benefit Plan Actuarial Assumptions and Actuarial Cost Methods Used in the Valuation 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. L. Changes Since Previous Valuation Retirement rates were used in accordance with the following tables. 1. For members with less than ten (10)years of service: f t> �1 Gen . i F e �ad 'l M � a g £ ,:...,-4 �6 s F � Jees: .e A , +� '�" &,n ---- V r,,v, ax,.s_ ) . .yea.,. 3m ^2. �e �Undek651; 4 tf-i'i 3 1nr_ 0% yf k S y 3� 9 a� i, 3'x:65 c"„ V As?; v'' � c . i Vey,''e {W 3. A $, +� Pt y, ,�` �' _�y�. 2. For members with ten (10) or more years, but less than twenty-five(25) years of service: i.Ot:i '�<, :°"� PiEi i Z `4 (0 is s-t,, 7 t'w a r ,�,7 yW:. SsS m E 7 3€ T%z k .i, Pt y a, -14- Gabriel Roeder Smith & Company • City of Winter Springs Defined Benefit Plan Actuarial Assumptions and Actuarial Cost Methods Used in the Valuation L. Changes Since Previous Valuation (continued) 3. For members with twenty-five(25) or more years of service: ^ �,,..:"°3 ,. '; .Iax' ,Nf,..� ,hd x„ :a;sJ;'."'T'`'1+ ' an w Age ".• Po ire' vrac e F�ar4 su,, . h _ _ 6w Y `:Under S5 p ...i'`,k�awGa� •�k"��3''.�:a ,µlf�.`��.'�' ,a�S,c..pp�� .. „^c f;�: cy/��q.QQ�'yyi,' 'vi.:'.'.'.. '. r w. "�25 in scs '�Y"c�7 �t),✓ba,°:�.,: .d "71:, 3F3fQ m" qi ' try,• '65'.,And„ate e*', t -15- Gabriel Roeder Smith & Company