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Ordinance No. 58-08-34 vORDINANCE NO. 58-08-34 AN ORDINANCE OF THE CITY OF ATLANTIC BEACH, FLORIDA, AMENDING CHAPTER 2, ADMINISTRATION, ARTICLE VI, DIVISION 3, GENERAL EMPLOYEE RETIREMENT SYSTEM, TO PROVIDE THE ABILITY TO CHANGE A NAMED BENEFICIARY UP TO TWO TIMES AFTER RETIREMENT; PROVIDING THE PURCHASE OF LIMITED CREDITED SERVICE FOR MILITARY SERVICE PRIOR TO EMPLOYMENT WITH THE CITY; PROVIDING FOR AN INCREASE IN THE VESTING REQUIREMENT FROM 5 TO 10 YEARS FOR EMPLOYEES HIRED ON OR AFTER THE FIRST DAY OF THE MONTH FOLLOWING FINAL APPROVAL AND ADOPTION OF THIS ORDINANCE; PROVIDING FOR THE RETURN TO THE NORMAL FORM OF RETIREMENT FOR RETIREES WHERE THE NAMED BENEFICIARY PREDECEASES THE RETIREE; PROVIDING FOR A SAVINGS CLAUSE; PROVIDING FOR SEVERABILITY; PROVIDING FOR CODIFICATION; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City of Atlantic Beach, Florida has an interest in the future retirement of its employees and wishes to improve the retirement systems whenever feasible; and WHEREAS, the City of Atlantic Beach, Florida recognizes the advantage of implementing certain enhanced benefits within its retirement systems; and WHEREAS, the City has received and reviewed actuarial impact statements related to these changes; and WHEREAS, the City of Atlantic Beach, Florida hereby amends its retirement systems to provide such benefits as follows: NOW THEREFORE, BE IT ENACTED BY THE CITY COMMISSION OF THE CITY OF ATLANTIC BEACH, FLORIDA, AS FOLLOWS: Section 1. Section 2-262 of Chapter 2, Administration, Article VI, Division 3, General Employee Retirement System of the Code of Ordinances is hereby amended as follows: Sec. 2-262. Definitions. The following words and phrases as used in this division shall have the following meanings unless a different meaning is clearly required by the context: Beneficiary shall mean any person, designated in writing_~ a member who is being paid, or has entitlement to future payment, of a pension or other benefit by the retirement system for a reason other than the person's membership in the retirement system. A member mad revoke such desi ng ation b~gning and filing with the board of trustees a new designation of beneficiary form at an t~prior to retirement, however after retirement, such designation of beneficiary may only be changed twice. The board of trustees shall require and the amount of the retirement income payable upon the designation of a new beneficiary shall be actuarially re-determined to ensure that the benefit paid is the actuarial equivalent of the present value of the member's current benefit taking into account the ages and sex of the former beneficiary the new beneficiary and the member. Section 2. Section 2-272 of Chapter 2, Administration, Article VI, Division 3, General Employee Retirement System of the Code of Ordinances is hereby amended as follows: Sec. 2-272. Credited service. Service rendered by a member of the retirement system shall be credited to the member's individual credited service account in accordance with rules the board of trustees shall from time to time prescribe and in accordance with the applicable provisions of the Florida Statutes. In no case shall more than one (1) year of credited service be credited on account of all service rendered by a member in any one period of twelve (12) consecutive calendar months. Service shall be credited to the nearest one- twelfth of a year. Service shall be credited for the total number of years, and fractional parts of years, of service of the member. A member may purchase up to five (5) years of credited service for service in the Armed Forces of the United States prior to employment by the city, by depositing the full actuarial costs of such years of credited service that would have occurred had the member been employed by the city for the number of years purchased Such payment for said prior credited service may be made as a lump sum or in installments not to exceed the years of service purchased• however must be paid in full prior to retirement. Installment payments shall require interest at the actuarial rate of return for the years purchased. Such purchase of prior credited service shall take effect upon vesting. If a member terminates service prior to vesting and receives a refund of employee contributions the amount paid for such prior credited service shall also be refunded Subject to the following: (1) Prior credited service shall not be granted for service where the member is either receiving, entitled to receive or was entitled to receive a benefit from another governmental pensions s (2) Prior credited service under this section shall only be provided for service in the Armed Forces of the United States. (3) Actual prior service credit purchased shall be added to the years of service with the city. Ordinance No. 58-08-34 Page 2 (4) Election to purchase prior credited service for prior service in the Armed Forces of the United States shall not exceed a total of five (Swears and shall be made in writing to the board of trustees The cost of prior credited service purchased for such prior service shall be the full actuarial cost of all credited service purchased hereunder computed as a lump sum pavment into the plan. Actual payment may at the member's option be extended over a period of time not to exceed the years purchased and shall be subiect to interest at the assumed actuarial rate for the years purchased Such pavment may be by direct in service transfer from a participant's deferred compensation account (457 accounts) pursuant to Section 457(e)(17) of the Internal Revenue Code or any other qualified plan Full pavment of such purchased prior credited service must be completed prior to the member's actual retirement. Section 3. Section 2-273 of Chapter 2, Administration, Article VI, Division 3, General Employee Retirement System of the Code of Ordinances is hereby amended as follows: Sec. 2-273. Loss of credited service. A retirement system member's credited service shall be forfeited and no longer in force if the member terminates city employment with less than five (5) .years of credited service. A retirement svstem member employed by the Citv on or ~ after September 1 2008 who terminates city employment with less than ten 10) years of credited service shall forfeit such credited service. Section 4. Section 2-276 of Chapter 2, Administration, Article VI, Division 3, General Employee Retirement System of the Code of Ordinances is hereby amended as follows: Sec. 2-276. Voluntary retirement conditions; employment after retirement. (b) The age and service requirements for voluntary retirement are: (1) Normal retirement.• The member has attained age sixty (60) years or older, and has five (5) or more years of credited service in force. For a retirement svstem member emplo~v the City on or after September 1 2008, normal retirement shall mean the attainment of aye sixty (60~ older, and has ten (10) or more ey ars of credited service in force (2) Early retirement.• The member has attained age fifty-five (55) years or older, and has five (5) or more years of credited service in force. For a retirement system member employed by the City on or after September 1 2008, early retirement shall mean the attainment of age fifty-five (55) or older, and ten (10) or more years of credited service in force. Ordinance No. 58-08-34 Page 3 Section 5. Section 2-278 of Chapter 2, Administration, Article VI, Division 3, General Employee Retirement System of the Code of Ordinances is hereby amended as follows: Sec. 2-278. Deferred retirement upon separation from employment (vesting). (b) The credited service requirement for separation from city employment with entitlement to deferred retirement is: five (5) years. For a retirement system member employed by the City on or after September 1 2008 the credited service requirement for separation from city employment with entitlement to deferred retirement is: ten (1 OZ e Section 6. Section 2-279 of Chapter 2, Administration, Article VI, Division 3, General Employee Retirement System of the Code of Ordinances is hereby amended as follows: Sec. 2-279. Disability retirement--General conditions for eligibility. (a.) A member having five (5) or more continuous years of credited service and having contributed to the retirement system for five (5) years or more, or a member hired on or after September 1 2008 having ten (10) or more continuous years of credited service and having contributed to the retirement system for ten (l0~years or more may retire from the service of the city if he becomes totally and permanently disabled as defined in subsection (b) by reason of any cause other than a cause set out in subsection (c). Such retirement shall herein be referred to as "disability retirement." Section 7. Section 2-282 of Chapter 2, Administration, Article VI, Division 3, General Employee Retirement System of the Code of Ordinances is hereby amended as follows: Sec. 2-282.Optional forms of pension payment. A member of the retirement system may elect to be paid under one (1) of the following optional forms of payment in lieu of the level straight life form of payment. The election must be made in writing and filed with the board of trustees prior to the date retirement is effective. Payment will be made under the level straight life form of payment if a timely election of an optional form of payment is not made. The amount of pension under Option A and Option B shall be the actuarial equivalent of the amount of pension under the level straight life form of payment. In no event may a member's annual benefit exceed the lesser o£ (1) Option A; one hundred (100) percent survivor pension: Under Option A, a retirant shall be paid a reduced pension for life with the provision that upon the retirant's death, the reduced pension shall be continued throughout the future lifetime of and paid to such personas the Ordinance No. 58-08-34 Page 4 retirant shall have nominated by written designation duly executed and filed with the board of trustees at the time of election of the optional form of payment. In the event the person nominated by the retirant predeceases the retirant, the monthly benefit shall increase to the amount payable under the normal form of payment for the remaining lifetime of the retirant (2) Option B; fifty (SO) percent survivor pension: Under Option B, a retirant shall be paid a reduced pension for life with the provision that upon the retirant's death, one-half of the reduced pension shall be continued throughout the future lifetime of and paid to such person as the retirant shall have nominated by written designation duly executed and filed with the board of trustees at the time of election of the optional form of payment. In the event the person nominated by the retirant predeceases the retirant, the monthly benefit shall increase to the amount payable under the normal form of payment for the remaining lifetime of the retirant (5) A deferred retirement option program (DROP), shall be established and administered by the board of trustees of the City of Atlantic Beach general employees' retirement system. Such DROP shall be aself-directed program. A general employee may enter the DROP as set forth herein. (a) Eligibility. A participant of the City of Atlantic Beach general employees' retirement system may enter into the DROP on the first day of the month following the attainment of age fifty-five (55) and five (5) years of service with the City of Atlantic Beach. A participant of the City of Atlantic Beach general employees' retirement system employed b~ the City on or after September 1, 2008 may enter into the DROP on the first day of the month following the attainment of age fifty-five and ten (10) years of service with the City of Atlantic Beach. However, a participant entering the DROP prior to attaining age sixty (60) shall have their benefit actuarially reduced for each year under the age of sixty (60). Participants who attained eligibility prior to the enactment of the DROP shall be afforded the option of participating immediately. Section 8. Section 2-298 of Chapter 2, Administration, Article VI, Division 3, General Employee Retirement System of the Code of Ordinances is hereby amended as follows: Sec. 2-298. Member contributions. (c) If an employee leaves the service of the city before accumulating aggregate time of five (5) years, or if employee was hired on or after September 1, 2008 before accumulating aggregate time of ten (10) years toward retirement and before being eligible to retire under the provisions of this article he/she shall be entitled to a refund of all of his or her contributions made to the city pension trust fund, plus any interest accumulated at a rate of interest determined annually by the board of trustees, less any disability benefits paid to him/her. If an employee who has been in the service of the city for at least five (5) years, or if employee Ordinance No. 58-08-34 Page 5 was hired on or after September 1 2008 and has been in the service of the city for at least ten (10) years and has contributed to the pension trust fund as provided elects to leave his or her accrued contributions in the trust fund, such employee, upon attaining the age as required in section 2- 278, may retire with the actuarial equivalent of the amount. of such retirement income otherwise payable to him/her. Section 9. The provision adopted herein shall prevail over any existing sections of the Atlantic Beach Code to the extent said existing sections are contrary or inconsistent herewith. Section 10. Severability. If any section, sentence, clause, word, or phrase of this Ordinance is held to be invalid or unconstitutional by a court of competent jurisdiction then said holding shall in no way affect the validity of the remaining portions of this Ordinance. Section 11. Codification. Specific authority is hereby granted to codify this Ordinance. Section 12. Effective Date. Note: The effective date for the modifications to the vesting requirement from 5 to 10 years will be September 1, 2008, which corresponds with the first day of the month following final passage and adoption of this Ordinance. This Ordinance, other than the provision referenced in the note above, shall take effect upon its final passage and adoption. PASSED by the City Commission on first reading this 14th day of July, 2008. PASSED by the City Commission on second and final reading this 11th day of August, 2008. ATTEST: Donna L. Bartle, CMC City Clerk as to form and correctness: ". Jensen, Esquire ttorney LEGEND: Underlining is new lap uage. / L1111V 1.111 Ordinance No. 58-08-34 Page 6