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1 ORDINANCE No. 08- 008
2
3 AN ORDINANCE OF THE CITY OF BOYNTON BEACH, FLORIDA,
4 AMENDING ARTICLE III, OF CHAPTER 18 OF THE BOYNTON
5 BEACH CODE OF ORDINANCES, ENTITLED "PENSIONS FOR
6 POLICE OFFICERS;" AMENDING SECTION 18-169 PROVIDING FOR
7 REQUIREMENTS FOR RETIREMENT -BENEFIT AMOUNTS;
8 AMENDING SECTION 18-174(G) PROVIDING FOR INTERNAL
9 REVENUE CODE LIMITS; AMENDING SECTION 18-175 PROVIDING
10 FOR DEFERRED RETIREMENT OPTION PLAN; PROVIDING FOR
11 CODIFICATION, CONFLICT, SEVERABILITY AND AN EFFECTIVE
12 DATE.
13
14 WHEREAS, the State Legislature of the State of Florida has enacted numerous
15 amendments to Chapter 185, Florida Statutes, known as the Municipal Police Officers'
16 Retirement Trust Funds;
17 WHEREAS, the State of Florida Municipal Police and Fire Pension Office requested
18 that the Board of Trustees clarify the provisions of the Plan related to the beginning date of
191 pensions for the vested terminated members;
20 WHEREAS, the Board of Trustees of the Municipal Police Officers Pension Fund
21 recommended a change to the period during which members may enter into the DROP;
22 WHEREAS, the Internal Revenue Department has issued final regulations regarding
23 governmental defined benefit plans which required a restatement of the plan provisions; and
24 WHEREAS, the City Commission of the City of Boynton Beach, Florida, desires to so
25 amend its Police Officers' Pension Ordinance;
26 NOW, THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF
27 THE CITY OF BOYNTON BEACH, FLORIDA:
28 Section 1. The foregoing "WHEREAS" clauses are hereby certified as being true
29 and correct and are incorporated herein by this reference.
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1 Section 2. Section 18-169( e) of Article III of Chapter 18 of the Boynton Beach
2 Code of Ordinances is hereby amended as follows:
3 Sec. 18-169. Requirements for retirement-benefit amounts.
4 * * *
5 (e) Separation from service.
6 (1) Effective for terminations on and after October 1, 2002, if a member
7 leaves the service of the city before accumulating aggregate time of five
8 years toward retirement and before being eligible to retire, such member
9 shall be entitled to a refund of all of his or her contributions made to the
10 fund, without interest.
11 (2) If any member who had been in the service of the city for at least ten
12 (10) years elects to leave his or her accrued contributions in the fund,
13 such police officer upon attaining age fifty (50) years or more (without
14 reaching what would have been twenty (20) years of service had he not
15 terminated his employment) may receive an early retirement benefit at
16 the actuarial equivalent of the amount of such retirement income
17 otherwise payable to him or her at early retirement or upon attaining
18 what would have been normal retirement had he not terminated his
19 employment, such police officer may receive his or her accrued normal
20 retirement benefit.
21 (3) Effective for terminations after October 1, 2002, if any member who had
22 been in the service of the city for at least five (5) years elects to leave his
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1 or her accrued contributions in the Fund, the police officer upon attaining
2 a!!e fiftv-five (55) with 10 or more years of service (had he or she not
3 terminated emDlovment) or reachin!! what would have been twentv
4 (20) years of service (had he or she not terminated his or her
5 emDlovment) what 'Nou1d ha'le been normal retirement had he or she not
6 terminated his or her employment, may receive the accrued normal
7 retirement benefit.
8 Section 3. Section 18-174 of Article III of Chapter 18 of the Boynton Beach Code of
9 the Boynton Beach Code of Ordinances is deleted in its entirety as replaced by the following:
10 Section 18-174 Miscellaneous
11 * * *
12 (G) Internal Revenue Code Limits
13 1. Basic Limitations. Subject to the adjustments in Dara!!raDh 3. the
14 maximum amount of the actual annual retirement income Daid in any year
15 with resDect to a ParticiDant under this Plan shall not exceed the dollar
16 amount allowable for any calendar year Dursuant to S415(b) of the Code. as
17 adjusted in such calendar year for increases in the cost of livin!! in
18 accordance with Re!!ulations issued bv the SecretarY of the Treasurv under
19 S415(d) of the Code. For DurDoses of aDDlyin!! the basic limitation. benefits
20 Davable in any form other than a strai2ht life annuitv with no ancillarY
21 benefits shall be adjusted. as Drovided bv Treasurv Re!!ulations. so that
22 such benefits are the Actuarial Eouivalent of a strai!!ht life annuitv. For
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1 DurDoses of this subsection Article. the followin!! benefits shall not be taken
2 into account:
3 a. Anv ancillarY benefit which is not directly related to retirement
4 income benefits:
5 b. Anv other benefit not reouired under S415(b)(2) of the Code and
6 Treasurv Re!!ulations thereunder to be taken into account for
7 DurDoses of the limitation ofS415(b)(l) of the Code.
8 2. ParticiDation in Other Defined Benefit Plans. The limitation of this
9 subsection with reSDect to any ParticiDant who at any time has been a
10 Particinant in any other defined benefit Dlan (as defined in S414(i) of the
11 Code) maintained bv the Citv shall aDDlv as if the total benefits Davable
12 under all defined benefit Dlans in which the ParticiDant has been a
13 ParticiDant where Davable from one Plan.
14 3. Adjustments in Limitations.
15 a. In the event the ParticiDant's retirement benefits become Davable
16 before a!!e sixtv-two (62), the maximum amount of annual
17 retirement income limitation Drescribed bv this Article shall be
18 reduced in accordance with Re!!ulations issued bv the SecretarY of
19 the Treasurv Dursuant to the Drovisions of S415(b) of the Code. so
20 that such limitation (as reduced) eouals an annual benefit (be!!innin!!
21 when such retirement income be!!ins) which is eouivalent to the
22 Code S415(b) maximum amount of annual retirement income
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1 be!!innin!! at a!!e 62.
2 b. In the event the ParticiDant's benefit is based on at least fifteen (15)
3 years of Credited Service. the adjustments Drovided for in
4 subnara!!raDh (a) above shall not aDnlv.
5 c. The reductions Drovided for in subDara!!raDh (a) above shall not be
6 aDDlicable to disabilitv benefits Dre-retirement death benefits.
7 d. In the event the ParticiDant's retirement benefit becomes Davable
8 after a!!e sixtv-five (65), for DurDoses of determinin!! whether this
9 benefit meets the basic limitation set forth in Dara!!raDh 1 herein.
10 such benefit shall be adjusted so that it is actuariallv eouivalent to
11 the benefit be!!innin!! at a!!e sixtv-five (65), This adjustment shall be
12 made usin!! an assumed interest rate of five Dercent (5%) and shall
13 be made in accordance with re!!ulations Dromul!!ated bv the
14 SecretarY of the Treasurv or his dele!!ate.
15 e. Less than Ten (10) Years of Service. The maximum retirement
16 benefits Davable under this Article to any ParticiDant who has
17 comDleted less than ten (10) years of Credited Service with the Citv
18 shall be the amount determined under Dara!!raDh 1 multiplied bv a
19 fraction. the numerator of which is the number of the ParticiDant's
20 years of Credited Service and the denominator of which is ten (10),
21 The reduction Drovided for in this subDara!!raDh shall not be
22 aDDlicable to disabilitv benefits or Dre-retirement death benefits.
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1 f. Ten Thousand Dollar $10.000 Limit. Notwithstandin!! the fore!!oin!!.
2 the retirement benefit oavable with resoect to a Particioant shall be
3 deemed not to exceed the limitations in this subsection if the benefits
4 oavable. with resoect to such Particioant under this Plan and under
5 all other oualified defined benefit nension olans to which the Citv
6 contributes. do not exceed ten thousand dollars ($10.000) for the
7 aoolicable Plan year and for any orior Plan Y ear and the Citv has
8 not at any time maintained a oualified defined contributions ulan in
9 which the Particioant oarticioated.
10 !!. Reduction of benefits. Reduction of benefits and/or contributions to
11 all olans. where reouired, shall be accomolished bv first reducin!! the
12 Particioant's benefit under any defined benefit olans in which
13 Particioant oarticioated. such reduction to be made first with
14 resoect to the olan in which Particioant most recentlv accrued
15 benefits and thereafter in such orioritv as shall be determined bv the
16 Board and the ulan administrator of such other olans. and next. bv
17 reducin!! or allocatin!! excess forfeitures for defined contribution
18 olans in which the Particioant oarticinated. such reduction to be
19 made first with resoect to the ulan in which Particioant most
20 recently accrued benefits and thereafter in such orioritv as shall be
21 established bv the Board and the olan administrator for such other
22 olans orovided. however. that necessarY reductions may be made in
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1 different manner and orioritv oursuant to the a!!reement of the
2 Board and the olan administrator of all other olans coverin!! such
3 Particioant.
4 h. Cost-of-Livin!! Adjustments. The limitations as stated herein shall
5 be adjusted annually in accordance with any cost-of-livin!!
6 adjustments orescribed bv the SecretarY of the Treasurv oursuant to
7 S415(d) of the Code.
8 (4) Additional Limitation on Pension Benefits. N otwithstandin!! anvthin!!
9 herein to the contrarY:
10 a. the normal retirement benefit or oension oavable to a Retiree who
11 becomes a Particioant of the Plan on or after Januarv 1. 1980. and
12 who has not oreviouslv oarticioated in such Plan. shall not exceed
13 100 oercent of his Avera!!e Final Comoensation. However. nothin!!
14 contained in this Article shall aoolv to suoolemental retirement
15 benefits or to oension increases attributable to cost-of-livin!!
16 increases or adjustments.
17
18 b. No Particioant of the Plan shall be allowed to receive a retirement
19 benefit or oension which is in Dart or in whole based uoon any
20 service with resoect to which the Particioant is alreadv receivin!!. or
21 will receive in the future. a retirement benefit or oension from a
22 different emolover's retirement olan. This restriction does not aoolv
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1 to social securitv benefits. militarv benefits or federal benefits under
2 Chaoter 67. Title 10. U.S. Code.
3
4 Section 4. Section 18-175(c), (d), (h) and G) of Article III of Chapter 18 of the
5 Boynton Beach Code of Ordinances is hereby amended as follows:
6 Sec. 18-175. Deferred retirement option plan.
7 * * *
8 (c) Full participation in the DROP must be exercised within the first twentv-five
9 t',venty two (22) years of combined credited service. However, participation in calendar year
10 2000, the first year, will be extended to all members.
11 (d) A Except for the extension of participation at inception as provided for in
12 paragraph (c) above, a member shall not participate in the DROP beyond the time of attaining
13 thirtv (30) twenty five (25) years of service and the total years of participation in the DROP
14 shall not exceed five (5) years. For example:
15 (1) Members with twenty (20) years of credited service at time of entry shall
16 only participate for five (5) years.
17 (2) Members with twentv-five (25) twenty one (21) years of credited
18 service at time of entry shall enly participate for five (5) four (1) years.
19 (3) Members with twentv-six (26) twenty two (22) years of credited service
20 at time of entry shall only participate for four (4) three (3) years.
21 * * *
22 (h) An employee's participation in the DROP shall terminate at the end of five (5)
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1 years or thirtv (30) tv/enty five (25) years of service, whichever comes first. Failure to end
2 DROP participation may result in penalties at the discretion of the Trustees, up to and including
3 forfeiture of the DROP account. Uoon enterin!! into the DROP. an emolovee shall file with
4 the Board a bindin!! letter of resi!!nation from Citv emolovment. The bindin!! letter of
5 resi!!nation shall establish a deferred termination date in accordance with the limitations
6 of this DROP. which may be amended.
7 * * *
8 (j) Upon termination of employment, participants in the DROP will receive the
9 balance of the DROP account in accordance with the following rules:
10 (1) Members may elect to begin to receive payment upon termination of
11 employment or defer payment of DROP until the latest day as provided
12 under sub-subparagraph (e~.
13 (2) Payments may be made in the following ways:
14 a. Lump sum. The entire account balance will be paid to the retirant
15 upon approval of the Board of Trustees.
16 b. Installments. The account balance will be paid out to the retirant
17 in five (5) equal annual payments paid over five (5) years, the
18 first payment to be made upon approval of the Board of Trustees.
19 c. Monthly installments. The account balance will be paid out to the
20 retirant on a monthly basis until the account balance is paid out
21 based on actuarial tables provided by the actuary.
22 (3) Any form of payment selected by a police officer must comply with the
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1 minimum distribution requirements of section 401 (A)(9) of the Internal
2 Revenue Code, and is subject to the requirements of 9 18-174(f) e.g.,
3 payments must commence by age 70.5.
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4 (4) The beneficiary of the DROP participant who dies before payments from
5 DROP begin shall have the same right to select payment options as the I
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6 participant in accordance with this subsection. A DROP participant may
7 designate a beneficiary to receive the DROP balance in the event of the
8 participant's death prior to payout of the full DROP balance.
9 Section 5. It is the intention of the City Commission of the City of Boynton Beach
10 that the provisions of this Ordinance shall become and be made a part of the Code of
11 Ordinances of the City of Boynton Beach, Florida. The Sections of this ordinance may be
12 renumbered, re-Iettered and the word "Ordinance" may be changed to "Section," "Article" or
13 such other word or phrase in order to accomplish such intention.
14 Section 6. All Ordinances or parts of Ordinances, Resolutions or parts of Resolutions
15 in conflict herewith be and the same are hereby repealed to the extent of such conflict.
16 Section 7. If any clause, section, or other part or application of this Ordinance shall
17 be held by any court of competent jurisdiction to be unconstitutional or invalid, such
18 unconstitutional or invalid part or application shall be considered as eliminated and so not
19 effecting the validity of the remaining portions or applications remaining in full force and
20 effect.
21 Section 8. This Ordinance shall become effective when all of the following have
22 occurred:
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1 (a) the City Commission has received and has accepted a report establishing the
2 actuarial soundness of these amendments; and
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4 (b) the amendments have been sent to the State of Florida Division of
5 Retirement; and
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7 (c) when a collective bargaining agreement ratifying the foregoing changes to
8 pension benefits has been ratified by the City Commission and the Palm
9 Beach County Police Benevolent Association or its successor organization
10 or when the City Commission and the Palm Beach County Police
11 Benevolent Association or its successor organization have agreed to waive
12 bargaining over the changes to pension benefits.
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14 FIRST READING THIS ~ DAY OF -Bf>R.\ L. ,2008.
15 SECOND, FINAL READING and PASSAGE THIS --'::L DAY OF MAY ,2008
16 CITY OF BOYNTON BEACH, FLORIDA
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41 and vested term clarification (PO).doc
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