ENGLEWOOD AREA FIRE CONTROL DISTRICT FIREFIGHTERS' … · 13420 Parker Commons Blvd., Suite 104...

ENGLEWOOD AREA FIRE CONTROL DISTRICT

FIREFIGHTERS' PENSION TRUST FUND

ACTUARIAL VALUATION

AS OF OCTOBER 1, 2015

CONTRIBUTIONS APPLICABLE TO THE

PLAN/FISCAL YEAR ENDING SEPTEMBER 30, 2017

13420 Parker Commons Blvd., Suite 104 Fort Myers, FL 33912 · (239) 433-5500 · Fax (239) 481-0634 · www.foster-foster.com

April 21, 2016

Board of Trustees

Firefighters’ Pension Board

Englewood Area Fire Control District

516 Paul Morris Dr.

Englewood, FL 34223-3960

Re: Englewood Area Fire Control District

Firefighters’ Pension Trust Fund

Dear Board:

We are pleased to present to the Board this report of the annual actuarial valuation of the Englewood Area

Fire Control District Firefighters’ Pension Trust Fund. The valuation was performed to determine

whether the assets and contributions are sufficient to provide the prescribed benefits and to develop the

appropriate funding requirements for the applicable plan year(s). Please note that this valuation may not

be applicable for any other purposes.

The valuation has been conducted in accordance with generally accepted actuarial principles and

practices, including the applicable Actuarial Standards of Practice as issued by the Actuarial Standards

Board, and reflects laws and regulations issued to date pursuant to the provisions of Chapters 112 and

175, Florida Statutes, as well as applicable federal laws and regulations. In our opinion, the assumptions

used in this valuation, as adopted by the Board of Trustees, represent reasonable expectations of

anticipated plan experience. Future actuarial measurements may differ significantly from the current

measurements presented in this report for a variety of reasons including: changes in applicable laws,

changes in plan provisions, changes in assumptions, or plan experience differing from expectations.

In conducting the valuation, we have relied on personnel, plan design, and asset information supplied by

the Englewood Area Fire Control District, financial reports prepared by the custodian bank, and the

actuarial assumptions and methods described in the Actuarial Assumptions section of this report. While

we cannot verify the accuracy of all this information, the supplied information was reviewed for

consistency and reasonableness. As a result of this review, we have no reason to doubt the substantial

accuracy of the information and believe that it has produced appropriate results. This information, along

with any adjustments or modifications, is summarized in various sections of this report.

The undersigned is familiar with the immediate and long-term aspects of pension valuations, and meets

the Qualification Standards of the American Academy of Actuaries necessary to render the actuarial

opinions contained herein. All of the sections of this report are considered an integral part of the actuarial

opinions.

To our knowledge, no associate of Foster & Foster, Inc. working on valuations of the program has any

direct financial interest or indirect material interest in the Englewood Area Fire Control District, nor does

anyone at Foster & Foster, Inc. act as a member of the Board of Trustees of the Englewood Area Fire

Control District Firefighters’ Pension Trust Fund. Thus, there is no relationship existing that might affect

our capacity to prepare and certify this actuarial report.

If there are any questions, concerns, or comments about any of the items contained in this report, please

contact me at 239-433-5500.

Respectfully submitted,

Foster & Foster, Inc.

By:

Douglas H. Lozen, EA, MAAA

Enrolled Actuary #14-7778

DHL/lke

Enclosures

TABLE OF CONTENTS

Section Title Page

I Introduction

a. Summary of Report 5

b. Contribution Impact of Annual Changes 7

c. Changes Since Prior Valuation 8

d. Requirements of Chapter 112, Part VII, Florida Statutes 9

II Valuation Information

a. Reconciliation of Unfunded Actuarial Accrued Liabilities 14

b. Detailed Actuarial (Gain)/Loss Analysis 16

c. Actuarial Assumptions and Methods 17

d. Valuation Notes 19

e. Partial History of Premium Tax Refunds 20

f. Excess State Monies Reserve 21

III Trust Fund 22

IV Member Statistics

a. Statistical Data 28

b. Age and Service Distribution 29

c. Valuation Participant Reconciliation 30

V Summary of Plan Provisions 31

Englewood Area Fire Control District Firefighters' Pension Trust Fund FOSTER & FOSTER | 4

SUMMARY OF REPORT

The regular annual actuarial valuation of the Englewood Area Fire Control District Firefighters' Retirement

Pension Trust Fund, performed as of October 1, 2015 has been completed and the results are presented in

this Report. The contribution amounts set forth herein are applicable to the plan/fiscal year ended

September 30, 2017.

The contribution requirements, compared with those developed in the October 1, 2014, actuarial valuation,

are as follows:

Valuation Date

Applicable Plan/Fiscal Yr. End

10/1/2015

9/30/2017

10/1/2014

9/30/2016

Total Required Contribution

% of Total Annual Payroll

63.91% 61.47%

Member Contributions (Est.)

% of Total Annual Payroll 7.00% 7.00%

District and State Required Contribution


State Contribution ¹

396,874

396,874


Balance from District ¹


¹ The District may use up to $396,874 in State Contributions for determining its minimum funding

requirements, based on the traditional interpretation of Chapter 99-1, Florida Statutes. For budgeting

purposes, the required Sponsor Contribution (District and State) is 56.91% of Pensionable Earnings for

the fiscal year ending September 30, 2017. The precise District requirement for the year is this amount,

less actual State Contributions (up to the maximum $396,874).

Please note that there is a District receivable contribution of $300,987 required for the fiscal year ending

September 30, 2015. Our review of the Plan’s Custodial Records show a deposit for this amount was

made in December, 2015.


Experience in the last twelve months has been more favorable than expected, relative to the Plan’s

actuarial assumptions. The primary sources of favorable experience included a 10.15% investment return

(Actuarial Asset Basis), exceeding the 7.50% assumption, average increase in pensionable compensation

that was less than the assumption by more than 4%, and greater than expected inactive mortality. There

were no material sources of actuarial loss.

In spite of the net actuarial gain for the year, the funding requirement, when expressed as a percentage of

Total Annual Payroll, increased due to a 3.2% decrease in Total Annual Payroll, combined with a

reduction in the payroll growth assumption (utilized for amortization of the Unfunded Actuarial Accrued

Liability). These decreases have the effect of increasing the percentage of payroll funding rate for

payment of the Unfunded Actuarial Accrued Liability.

The balance of this Report presents additional details of the actuarial valuation and the general operation

of the Fund. The undersigned would be pleased to meet with the Board of Trustees in order to discuss the

Report and answer any pending questions concerning its contents.

Respectfully submitted,

FOSTER & FOSTER, INC.

By:


By:

Christine M. O’Neal, ASA, EA, MAAA


(1) Contribution Determined as of October 1, 2014 41.82%

(2) Summary of Contribution Impact by component:

Change in Available State Money 0.0%

Investment Return (Actuarial Asset Basis) -2.1%

Salary Increases -1.2%

Payroll Change 2.9%

Payroll Growth Assumption 2.0%

Change in Administrative Expense 0.7%

New Entrants 0.0%

Active Decrements -0.4%

Inactive Mortality -0.5%

Change in Normal Cost 0.1%

Assumption Change 0.0%

Other 0.5%

Total Change in Contribution 2.02%

(3) Contribution Determined as of October 1, 2015 43.84%

CONTRIBUTION IMPACT OF ANNUAL CHANGES


CHANGES SINCE PRIOR VALUATION

Plan Changes

There have been no changes in benefits since the prior valuation.

Actuarial Assumption/Method Changes

There were no changes in methods or assumptions since the prior valuation. However, in order to

comply with Part VII of Chapter 112, Florida Statutes, the payroll growth assumption was

lowered from 5.00% per year to 3.58% per year, equal to the actual average increase in payroll

over the past 10 years.


COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS

10/1/2015 10/1/2014

A. Participant Data

Number Included

Actives 41 43

Service Retirees 12 11

DROP Retirees 9 10

Beneficiaries 0 1

Disability Retirees 1 1

Terminated Vested 0 1

Total 63 67

Total Annual Payroll $3,036,261 $3,136,647

Payroll Under Assumed Ret. Age 3,036,261 3,136,647

Annual Rate of Payments to:

Service Retirees 636,808 560,568

DROP Retirees 538,802 594,468

Beneficiaries 0 22,968

Disability Retirees 46,272 17,649

Terminated Vested 0 0

B. Assets

Actuarial Value ¹ 22,526,604 19,663,872

Market Value ¹ 22,054,769 21,257,192

C. Liabilities

Present Value of Benefits

Actives

Retirement Benefits 17,082,284 16,822,247

Disability Benefits 128,868 136,587

Death Benefits 153,543 158,116

Vested Benefits 1,113,702 1,128,002

Refund of Contributions 35,306 59,134

Service Retirees 8,396,619 7,378,658

DROP Retirees¹ 8,885,153 9,457,843

Beneficiaries 0 22,224

Disability Retirees 518,274 171,233

Terminated Vested 0 23,837

Excess State Monies Reserve 279,282 187,372

Total 36,593,031 35,545,253


C. Liabilities - (Continued) 10/1/2015 10/1/2014

Present Value of Future Salaries 22,794,524 25,270,172

Present Value of Future

Member Contributions 1,595,617 1,768,912

Normal Cost (Retirement) 688,544 706,212

Normal Cost (Disability) 12,291 12,954

Normal Cost (Death) 8,867 9,085

Normal Cost (Vesting) 70,931 69,555

Normal Cost (Refunds) 12,111 16,798

Total Normal Cost 792,744 814,604

Present Value of Future

Normal Costs 5,589,024 6,171,873

Accrued Liability (Retirement) 12,113,281 11,346,280

Accrued Liability (Disability) 50,107 48,117

Accrued Liability (Death) 94,012 92,154

Accrued Liability (Vesting) 656,239 626,784

Accrued Liability (Refunds) 11,040 18,878

Accrued Liability (Inactives) ¹ 17,800,046 17,053,795

Excess State Monies Reserve 279,282 187,372

Total Actuarial Accrued Liability 31,004,007 29,373,380

Unfunded Actuarial Accrued

Liability (UAAL) 8,477,403 9,709,508

Funded Ratio (AVA / AL) 72.7% 66.9%

D. Actuarial Present Value of Accrued Benefits

Vested Accrued Benefits

Inactives ¹ 17,800,046 17,053,795

Actives 5,478,416 4,754,329

Member Contributions 1,948,771 1,835,717

Total 25,227,233 23,643,841

Non-vested Accrued Benefits 2,372,143 2,481,969

Total Present Value Accrued Benefits 27,599,376 26,125,810

Funded Ratio (MVA / PVAB) 79.9% 81.4%

Increase (Decrease) in Present Value of

Accrued Benefits Attributable to:

Plan Amendments 0

Assumption Changes 0

New Accrued Benefits 463,038

Benefits Paid (914,610)

Interest 1,925,138

Other 0

Total 1,473,566


Valuation Date 10/1/2015 10/1/2014

Applicable to Fiscal Year Ending 9/30/2017 9/30/2016

E. Pension Cost

Normal Cost (with interest) $822,472 $845,152

% of Total Annual Payroll ² 27.09 26.94

Administrative Expenses (with interest) 53,516 31,769


Payment Required to Amortize

Unfunded Actuarial Accrued

Liability over 25 years

(as of 10/1/2015, with interest) 1,064,553 1,051,545


Total Required Contribution 1,940,541 1,928,466


Expected Member Contributions 212,538 219,565


Expected District and State Contribution 1,728,003 1,708,901


F. Past Contributions

Plan Years Ending: 9/30/2015

Total Required Contribution 1,699,737

District and State Requirement 1,494,914

Actual Contributions Made:

Members (excluding buyback) 204,823

District 1,098,040

State 396,874 ³

Total 1,699,737

G. Net Actuarial (Gain)/Loss (1,096,876)

¹ The asset values and liabilities for DROP Members include accumulated DROP

Balances as of 9/30/2015 and 9/30/2014.

² Contributions developed as of 10/1/2015 are expressed as a percentage of total

annual payroll at 10/1/2015 of $3,036,261.

³ Reflects traditional interpretation of Chapter 99-1, Florida Statutes.


H. Schedule Illustrating the Amortization of the Total Unfunded Actuarial Accrued Liability as of:

Projected Unfunded

Year Accrued Liability

2015 8,477,403

2016 8,010,177

2017 7,468,425

2023 5,449,127

2029 1,704,031

2040 0

I. (i) 3 Year Comparison of Actual and Assumed Salary Increases

Actual Assumed

Year Ended 9/30/2015 1.65% 6.00%

Year Ended 9/30/2014 1.28% 6.00%

Year Ended 9/30/2013 1.57% 6.00%

(ii) 3 Year Comparison of Investment Return on Actuarial Value

Actual Assumed

Year Ended 9/30/2015 10.15% 7.50%

Year Ended 9/30/2014 10.22% 7.50%

Year Ended 9/30/2013 10.07% 7.50%

(iii) Average Annual Payroll Growth

(a) Payroll as of: 10/1/2015 $3,036,261

10/1/2005 2,136,591

(b) Total Increase 42.11%

(c) Number of Years 10.00

(d) Average Annual Rate 3.58%


STATEMENT BY ENROLLED ACTUARY

This actuarial valuation 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 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.

_____________________________


Enrolled Actuary #14-7778

Please let us know when the report is approved by the Board and unless otherwise directed we will

provide copies of the report to the following offices to comply with Chapter 112 Florida Statutes:

Mr. Keith Brinkman

Bureau of Local

Retirement Systems

Post Office Box 9000

Tallahassee, FL 32315-9000

Ms. Sarah Carr

Municipal Police and Fire

Pension Trust Funds

Division of Retirement

Post Office Box 3010

Tallahassee, FL 32315-3010


RECONCILIATION OF UNFUNDED ACTUARIAL ACCRUED LIABILITIES

(1) Unfunded Actuarial Accrued Liability as of October 1, 2014 $9,709,508

(2) Sponsor Normal Cost developed as of October 1, 2014 595,039

(3) Expected administrative expenses for the year ended September 30, 2015 30,621

(4) Expected interest on (1), (2) and (3) 773,989

(5) Sponsor contributions to the System during the year ended September 30, 2015 1,494,914

(6) Expected interest on (5) 39,964

(7) Expected Unfunded Actuarial Accrued Liability as of

September 30, 2015 (1)+(2)+(3)+(4)-(5)-(6) 9,574,279

(8) Change to UAAL due to Assumption Change 0

(9) Change to UAAL due to Actuarial (Gain)/Loss (1,096,876)

(10) Unfunded Accrued Liability as of October 1, 2015 8,477,403

Type of Date Years 10/1/2015 Amortization

Base Established Remaining Amount Amount

12/1/1995 20 $291,328 $20,263

10/1/1998 13 65,141 6,202

10/1/1999 14 99,293 8,929

10/1/2000 15 (46,983) (4,011)

method change 10/1/2004 19 1,204,700 86,769

prior losses 10/1/2004 13 1,074,646 102,313

benefit change 10/1/2004 19 1,973,675 142,155

actuarial loss 10/1/2005 13 570,862 54,350

actuarial loss 10/1/2006 13 605,252 57,624

actuarial loss 10/1/2007 13 439,736 41,866

actuarial loss 10/1/2008 3 485,092 167,740

method change 10/1/2008 13 (169,502) (16,138)

benefit change 10/1/2008 23 2,835,783 180,011

actuarial loss 10/1/2009 4 746,779 197,223

actuarial loss 10/1/2010 5 653,431 140,571

assumption change 10/1/2010 15 2,188,105 186,778

benefit change 10/1/2010 25 (3,274,720) (197,403)

actuarial loss 10/1/2011 6 528,631 96,485

actuarial gain 10/1/2012 7 (150,525) (23,972)


RECONCILIATION OF UNFUNDED ACTUARIAL ACCRUED LIABILITIES

(1) Unfunded Actuarial Accrued Liability as of October 1, 2014 $9,709,508

(2) Sponsor Normal Cost developed as of October 1, 2014 595,039

(3) Expected administrative expenses for the year ended September 30, 2015 30,621

(4) Expected interest on (1), (2) and (3) 773,989

(5) Sponsor contributions to the System during the year ended September 30, 2015 1,494,914

(6) Expected interest on (5) 39,964

(7) Expected Unfunded Actuarial Accrued Liability as of

September 30, 2015 (1)+(2)+(3)+(4)-(5)-(6) 9,574,279

(8) Change to UAAL due to Assumption Change 0

(9) Change to UAAL due to Actuarial (Gain)/Loss (1,096,876)

(10) Unfunded Accrued Liability as of October 1, 2015 8,477,403

Type of Date Years 10/1/2015 Amortization

Base Established Remaining Amount Amount

actuarial gain 10/1/2013 8 (326,769) (46,349)

software change 10/1/2013 18 340,589 25,471

actuarial gain 10/1/2014 9 (560,265) (71,893)

actuarial gain 10/1/2015 10 (1,096,876) (128,909)

8,477,403 1,026,075


(1) Unfunded Actuarial Accrued Liability (UAAL) as of October 1, 2014 $9,709,508

(2) Expected UAAL as of October 1, 2015 9,574,279

(3) Summary of Actuarial (Gain)/Loss, by component:

Investment Return (Actuarial Asset Basis) (531,532)

Salary Increases (307,396)

Active Decrements (95,861)

Inactive Mortality (133,578)

Other (28,509)

Increase in UAAL due to (Gain)/Loss (1,096,876)

Assumption Changes 0

(4) Actual UAAL as of October 1, 2015 $8,477,403

DETAILED ACTUARIAL (GAIN)/LOSS ANALYSIS


ACTUARIAL ASSUMPTIONS AND METHODS

Mortality Rate RP 2000 Combined Healthy Mortality Table,

Sex Distinct. Disabled lives are set forward 5

years.

We believe this assumption sufficiently

accommodates future mortality improvements.

Interest Rate 7.5% per year compounded annually, net of

investment-related expenses. This assumption is

supported by the target asset allocation of the

trust and the expected long-term return by asset

class.

Retirement Age Earlier age 55 and 10 years of service or 23

years of service, regardless of age. Also, any

member who has reached Normal Retirement is

assumed to continue employment for one

additional year.

Early Retirement Commencing with eligibility for Early

Retirement Age (Age 50 with 10 years of

service), members are assumed to retire with an

immediate subsidized benefit at the rate of 5%

per year.

Non-Investment Expenses $51,582 per year, based on actual

Administrative Expenses incurred during the

prior fiscal year.

Cost-of-Living Adjustment 1.7% beginning one year after retirement, for

Normal and Early Retirees.

Payroll Growth 3.58% per year (5.00% utilized for the 10/1/14

valuation). This assumption is limited by State

Statute to not exceed the ten-year average

payroll growth determined as of the valuation

date.

Funding Method Entry Age Normal Actuarial Cost Method.

Asset Smoothing Methodology The Actuarial Value of Assets is brought

forward using the historical four-year geometric

average of Market Value Returns (net-of-fees).

Over time, this may result in an insignificant

bias that is above or below the Market Value of

Assets.


Disability Rate See table below (1201). 75% of Disability

Retirements are assumed to be Line-of-Duty

related. This assumption is consistent with rates

utilized by other Florida Municipal Defined

Benefit Plans for Firefighters.

Termination Rate See table below (1302). This assumption is

consistent with rates utilized by other Florida

Municipal Defined Benefit Plans for

Firefighters.

Salary Increases 6.0% per year until the assumed retirement

age; see table below. This assumption is

consistent with the Plan’s long-term experience.

% Terminating % Becoming Disabled Current Salary as %

Age During the Year During the Year of Salary at age 53

20 6.0% 0.03% 14.6%

30 5.0 0.04 26.2

40 2.6 0.07 46.9

50 0.8 0.18 84.0


VALUATION NOTES

Total Annual Payroll is the projected annual rate of pay as of the valuation date of all covered Members.

Present Value of Benefits is the single sum value on the valuation date of all future benefits to be paid to

current Members, Retirees, Beneficiaries, Disability Retirees and Vested Terminations.

Normal (Current Year's) Cost is determined for each participant as the present value of future benefits,

determined as of the Member’s entry age, amortized as a level percentage of compensation over the

anticipated number of years of participation, determined as of the entry age.

Individual Entry Age Normal Actuarial Cost Method (Level Percent of Compensation) is the method used

to determine required contributions under the Plan. The use of this method involves the systematic

funding of the Normal Cost (described above) and the Unfunded Accrued (Past Service) Liability.

The actuarial accrued liability for active participants is the difference between the present value of

future benefits and the present value of future Normal Costs. The actuarial accrued liability for

inactive participants is the present value of future benefits.

Unfunded Actuarial Accrued Liability (UAAL) is the difference between the actuarial accrued liability

(described above) and the actuarial value of assets. Under the Entry Age Normal Actuarial Cost

Method, an actuarial gain or loss, based on actual versus expected UAAL, is determined in

conjunction with each valuation of the plan.

Total Required Contribution is equal to the Normal Cost plus an amount sufficient to amortize the

Unfunded Accrued Liability over no more than 30 years. The required amount is adjusted for interest

according to the timing of contributions during the year.


PARTIAL HISTORY OF PREMIUM TAX REFUNDS

Received During Increase from

Fiscal Year Amount Previous Year

1996 20,929.32 _____%

1997 45,459.89 117.2%

1998 51,446.44 13.2%

1999 50,617.76 -1.6%

2000 93,178.26 84.1%

2001 107,623.20 15.5%

2002 122,563.49 13.9%

2003 144,260.17 17.7%

2004 175,152.10 21.4%

2005 226,110.94 29.1%

2006 266,526.13 17.9%

2007 361,092.49 35.5%

2008 481,783.20 33.4%

2009 448,435.76 -6.9%

2010 418,639.65 -6.6%

2011 406,217.60 -3.0%

2012 457,151.32 12.5%

2013 486,198.18 6.4%

2014 434,645.78 -10.6%

2015 488,784.67 12.5%


EXCESS STATE MONIES RESERVE

Actual Applicable Excess State Actual Applicable Excess State

State Contribution "Frozen" Amount Monies Reserve State Contribution "Frozen" Amount Monies Reserve

1998 $51,446.44 $51,446.44 $0.00 N/A N/A N/A

1999 50,617.76 51,446.44 0.00 0.00 0.00 0.00

2000 93,178.26 110,382.44 0.00 0.00 0.00 0.00

2001 100,041.84 102,801.08 0.00 7,581.36 7,581.36 0.00

2002 111,362.82 110,382.44 980.38 11,200.67 0.00 11,200.67

2003 117,640.62 110,382.44 7,258.18 26,619.55 0.00 26,619.55

2004 125,827.11 110,382.44 15,444.67 49,324.99 0.00 49,324.99

2005 150,544.04 183,320.54 0.00 75,566.90 75,566.90 0.00

2006 179,579.66 171,940.97 7,638.69 86,946.47 86,946.47 0.00

2007 253,331.36 151,126.31 102,205.05 107,761.13 107,761.13 0.00

2008 266,026.97 43,131.21 222,895.76 215,756.23 215,756.23 0.00

2009 239,627.15 268,749.83 0.00 208,808.61 208,808.61 0.00

2010 291,004.87 349,923.66 0.00 127,634.78 127,634.78 0.00

2011 299,234.97 370,575.81 0.00 106,982.63 106,982.63 0.00

2012 340,652.09 280,375.21 60,276.88 116,499.23 116,499.23 0.00

2013 349,953.63 260,629.89 89,323.74 136,244.55 136,244.55 0.00

2014 320,569.17 282,797.83 37,771.34 114,076.61 114,076.61 0.00

2015 337,917.73 246,007.50 91,910.23 150,866.94 150,866.94 0.00

635,704.92 87,145.21

Accumulated Regular Excess 635,704.92

Accumulated Special Excess 87,145.21

Less Excess Used in Funding

Ordinance No. 05/04-1039 (110,828.44)

Less Excess Used in Funding

Ordinance No. 09/04-1223A (332,739.50)

Equals Current State Monies Reserve $279,282.19

Regular Distribution Special Distribution

Firefighters' Distribution


ASSETS COST VALUE MARKET VALUE

Cash and Cash Equivalents:

Short Term Investments 346,853.50 346,853.50

Total Cash and Equivalents 346,853.50 346,853.50

Receivables:

District Contributions 276,323.89 276,323.89

Additional District Contributions 24,663.38 24,663.38

State Contributions 337,917.73 337,917.73

Investment Income 58,527.10 58,527.10

Total Receivable 697,432.10 697,432.10

Investments:

U. S. Bonds and Bills 680,537.01 684,409.80

Federal Agency Guaranteed Securities 1,498,670.00 1,502,111.84

Corporate Bonds 3,427,975.45 3,249,559.11

Stocks 8,798,077.11 10,030,407.79

Mutual Funds:

Fixed Income 993,053.95 866,635.37

Equity 2,018,039.90 1,857,090.75

Pooled/Common/Commingled Funds:

Real Estate 2,626,086.23 2,846,536.98

Total Investments 20,042,439.65 21,036,751.64

Total Assets 21,086,725.25 22,081,037.24

LIABILITIES

Payables:

Investment Expenses 24,005.21 24,005.21

Administrative Expenses 2,263.36 2,263.36

Total Liabilities 26,268.57 26,268.57

NET POSITION RESTRICTED FOR PENSIONS 21,060,456.68 22,054,768.67

STATEMENT OF FIDUCIARY NET POSITION

SEPTEMBER 30, 2015


STATEMENT OF CHANGES IN FIDUCIARY NET POSITION

FOR THE YEAR ENDED SEPTEMBER 30, 2015

Market Value Basis

ADDITIONS

Contributions:

Member 204,822.88

District 1,098,039.98

State 488,784.67

Total Contributions 1,791,647.53

Investment Income:

Net Realized Gain (Loss) 399,764.44

Unrealized Gain (Loss) (905,522.89)

Net Increase in Fair Value of Investments (505,758.45)

Interest & Dividends 640,379.33

Less Investment Expense¹ (162,499.23)

Net Investment Income (27,878.35)

Total Additions 1,763,769.18

DEDUCTIONS

Distributions to Members:

Benefit Payments 657,097.52

Lump Sum DROP Distributions 206,330.77

Refunds of Member Contributions 51,181.38

Total Distributions 914,609.67

Administrative Expense 51,582.35

Total Deductions 966,192.02

Net Increase in Net Position 797,577.16

NET POSITION RESTRICTED FOR PENSIONS

Beginning of the Year 21,257,191.51

End of the Year 22,054,768.67

¹Investment related expenses include investment advisory, custodial and performance monitoring fees.


ACTUARIAL ASSET VALUATION

SEPTEMBER 30, 2015

Actuarial Assets for funding purposes are developed by increasing the Actuarial Assets used

in the most recent actuarial valuation of the Fund by the average annual market value rate of

return (net of investment related expenses) for the past four years. Actuarial Assets shall not be

less than 80% nor greater than 120% of Market Value of Assets.

Details of the derivation are set forth as follows:

Plan Year End Rate of Return*

09/30/2012 17.90%

09/30/2013 12.38%

09/30/2014 11.24%

09/30/2015 -0.13%

Annualized Rate of Return for prior four (4) years: 10.15%

(A) 10/01/2014 Actuarial Assets: $19,663,872.32

(I) Net Investment Income:

1. Interest and Dividends 640,379.33

2. Realized Gains (Losses) 399,764.44

3. Change in Actuarial Value 1,159,632.08

4. Investment Related Expenses (162,499.23)

Total 2,037,276.62

(B) 10/01/2015 Actuarial Assets: $22,526,604.45

Actuarial Asset Rate of Return = 2I/(A+B-I): 10.15%

10/01/2015 Limited Actuarial Assets: $22,526,604.45

10/01/2015 Market Value of Assets: $22,054,768.67

Actuarial Gain/(Loss) due to Investment Return (Actuarial Asset Basis) $531,531.61

*Market Value Basis, net of investment related expenses.


SEPTEMBER 30, 2015

Actuarial Asset Basis

REVENUES

Contributions:

Member 204,822.88

District 1,098,039.98

State 488,784.67

Total Contributions 1,791,647.53

Earnings from Investments:

Interest & Dividends 640,379.33

Net Realized Gain (Loss) 399,764.44

Change in Actuarial Value 1,159,632.08

Total Earnings and Investment Gains 2,199,775.85

EXPENDITURES

Distributions to Members:

Benefit Payments 657,097.52

Lump Sum DROP Distributions 206,330.77

Refunds of Member Contributions 51,181.38

Total Distributions 914,609.67

Expenses:

Investment related¹ 162,499.23

Administrative 51,582.35

Total Expenses 214,081.58

Change in Net Assets for the Year 2,862,732.13

Net Assets Beginning of the Year 19,663,872.32

Net Assets End of the Year² 22,526,604.45

¹Investment related expenses include investment advisory, custodial and performance monitoring fees.

²Net Assets may be limited for actuarial consideration.

CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS


Beginning of the Year Balance 1,058,427.42

Plus Additions 572,450.44

Investment Return Earned 36,128.47

Less Distributions (206,330.77)

End of the Year Balance 1,460,675.56

DEFERRED RETIREMENT OPTION PLAN ACTIVITY

October 1, 2014 to September 30, 2015


(1) Total Required Contribution Rate 58.09%

(2) Pensionable Payroll Derived from Member Contributions $2,926,041.14

(3) Total Required Contribution (1) x (2) 1,699,737.30

(4) Less Actual Member Contributions (204,822.88)

(5) Less Allowable State Contribution (396,874.44)

(6) Equals Required District Contribution for Fiscal 2015 1,098,039.98

(7) Less 2014 Prepaid Contribution 0.00

(8) Less Actual District Contributions (797,052.71)

(9) Equals District's Shortfall/(Prepaid) Contribution as of $300,987.27

September 30, 2015

RECONCILIATION OF DISTRICT'S SHORTFALL/(PREPAID) CONTRIBUTION

FOR THE FISCAL YEAR ENDED (FYE) SEPTEMBER 30, 2015


STATISTICAL DATA ¹

10/1/2012 10/1/2013 10/1/2014 10/1/2015

Actives

Number 51 47 43 41

Average Current Age 40.0 40.2 40.1 40.5

Average Age at Employment 28.8 28.9 28.4 28.3

Average Past Service 11.2 11.3 11.7 12.2

Average Annual Salary $72,083 $72,396 $72,945 $74,055

Service Retirees

Number 10 11 11 12


Average Annual Benefit $49,066 $50,091 $50,961 $53,067

DROP Retirees

Number 4 7 10 9



Beneficiaries ²

Number 1 1 1 0

Average Current Age N/A N/A N/A N/A

Average Annual Benefit $22,584 $22,968 $22,968 N/A

Disability Retirees

Number 2 2 1 1



Terminated Vested ³

Number 0 0 0 0

Average Current Age N/A N/A N/A N/A

Average Annual Benefit N/A N/A N/A N/A

¹ Prior to 10/1/2015, averages were salary weighted.

² Beneficary payment based on remainder of 120 payment guarantee.

³ Excludes non-vested terminated participants due only a refund of Member Contributions.


AGE AND SERVICE DISTRIBUTION

PAST SERVICE

AGE 0 1 2 3 4 5-9 10-14 15-19 20-24 25-29 30+ Total

15 - 19 0 0 0 0 0 0 0 0 0 0 0 0

20 - 24 0 0 0 1 0 0 0 0 0 0 0 1

25 - 29 0 0 0 0 0 1 0 0 0 0 0 1

30 - 34 0 0 0 0 1 2 4 0 0 0 0 7

35 - 39 0 0 0 0 0 6 5 1 0 0 0 12

40 - 44 0 0 0 0 0 2 2 1 0 0 0 5

45 - 49 0 0 0 0 0 1 3 4 2 0 0 10

50 - 54 0 0 0 0 0 2 1 1 1 0 0 5

55 - 59 0 0 0 0 0 0 0 0 0 0 0 0

60 - 64 0 0 0 0 0 0 0 0 0 0 0 0

65+ 0 0 0 0 0 0 0 0 0 0 0 0

Total 0 0 0 1 1 14 15 7 3 0 0 41


VALUATION PARTICIPANT RECONCILIATION

1. Active lives

a. Number in prior valuation 10/1/2014 43

b. Terminations

i. Vested (partial or full) with deferred benefits 0

ii. Non-vested or full lump sum distribution received 0

c. Deaths

i. Beneficiary receiving benefits 0

ii. No future benefits payable (1)

d. Disabled (1)

e. Retired 0

f. DROP 0

g. Continuing participants 41

h. New entrants 0

i. Total active life participants in valuation 41

2. Non-Active lives (including beneficiaries receiving benefits)

Service

Retirees,

Vested Receiving Receiving

Receiving DROP Death Disability Vested

Benefits Benefits Benefits Benefits Deferred Total

a. Number prior valuation 11 10 1 1 1 24

Retired 0 (1) 0 0 0 (1)

DROP 1 0 0 0 0 1

Vested Deferred 0 0 0 0 0 0

Death, With Survivor 0 0 0 0 0 0

Death, No Survivor 0 0 0 (1) 0 (1)

Disabled 0 0 0 1 0 1

Refund of Contributions 0 0 0 0 (1) (1)

Rehires 0 0 0 0 0 0

Expired Annuities 0 0 (1) 0 0 (1)

Data Corrections 0 0 0 0 0 0

b. Number current valuation 12 9 0 1 0 22


SUMMARY OF PLAN PROVISIONS

(Through Ordinance No. 2013 – 600)

Latest Amendment Date July 17, 2013.

Eligibility Full-time employees who are classified as full-

time Firefighters shall participate in the System

as a condition of employment.

Credited Service Total years and fractional parts of years of

employment with the District as a Firefighter.

Salary Base pay plus longevity pay and tax

exempt/deferred items.

Average Final Compensation (AFC) Average Salary for the highest 5 years during

the 10 years immediately preceding retirement

or termination.

Accrued Benefit The sum of the following:

a) 3.50% of Average Final Compensation

(using the highest two-year average of

pensionable earnings prior to January 6,

2012) for each year of Credited Service

prior to January 6, 2012, plus

b) 3.25% of Average Final Compensation

(using the highest five-year average of

pensionable earnings earned after January 5,

2012) for each year of Credited Service

earned after January 5, 2012.

Normal Retirement

Date Earlier of age 55 and 10 years of Credited

Service, or 20 years of Credited Service,

regardless of age.

Form of Benefit Ten Year Certain and Life Annuity

(options available).

Early Retirement

Eligibility Age 50 with 10 years of Credited Service.

Benefit Accrued Benefit, reduced 3% per year.


Cost –of Living Adjustment Each October 1, after one full year of retirement,

Normal and Early Retirees receive a 1.7%

increase in their monthly benefit.

Vesting

Schedule 100% after 10 years of Credited Service.

Benefit Amount Member will receive the vested portion of his

(her) accrued benefit payable at the otherwise

Normal Retirement Date.

Disability

Eligibility

Service Incurred Covered from Date of Employment.

Non-Service Incurred 10 years of Credited Service.

Exclusions Disability resulting from use of drugs, illegal

participation in riots, service in military, etc.

Benefit Benefit accrued to date of disability but not less

than 42% of Average Final Compensation

(Service Incurred).

Duration Payable for life with 120 payments guaranteed

or until recovery (as determined by the Board).

Options available.

Death Benefits

Pre-Retirement

Vested Monthly accrued benefit payable to designated

beneficiary for 10 years.

Non-Vested Refund of accumulated contributions without

interest.

Post-Retirement Benefits payable to beneficiary in accordance

with option selected at retirement.

District Contributions Remaining amount necessary to pay current

costs and amortize past service cost, if any, over

a period up to 30 years. Minimum Contribution

by District is 16.6% of total Salary of the

Members.

Member Contributions 7.0% of Salary.


Board of Trustees a. Two District Board appointees,

b. Two Members of the Department

elected by the membership, and

c. Fifth Member elected by other 4

Trustees.


ENGLEWOOD AREA FIRE CONTROL DISTRICT FIREFIGHTERS' … · 13420 Parker Commons Blvd., Suite 104...

Documents

Transcript of ENGLEWOOD AREA FIRE CONTROL DISTRICT FIREFIGHTERS' … · 13420 Parker Commons Blvd., Suite 104...