As I am sure you will recall, on November 7, 2017 City Council adopted Ordinance No. 2017-2121 which memorialized the terms of the labor agreement between the City and the West Central Florida Police Benevolent Association. The ordinance, which is attached for your reference, relates to certain pension benefits covering the period October 1, 2015 and spanning through September 30, 2018. Also attached is a letter from Mr. Lawrence F. Wilson from GRS Retirement Consulting with their analysis of the ordinance.
The purpose of this agenda item is twofold. First, to complete the adoption process by advancing an ordinance which sets forth to amend the City of New Port Richey Police Officers Retirement System. Secondarily to effectuate changes to reflect certain changes to the Internal Revenue Code (IRC) and its associated regulations.
The ordinance prescribes the following amendments to the pension plan:
1. Section 17-51, Definitions, is being amended for IRC changes and requirements, to specifically amend the definitions of:
a.) Average Final Compensation-to add the effective date of the benefit freeze
b.) Actuarial Equivalent-to incorporate the mortality table and interest rate currently being used by the plan's actuary
c.) Credited Service- to clarify IRC regulations related to leave conversions
d.) Salary- to add the effective date of the benefit freeze
e.) Spouse- to update the definition to reflect a U.S. Supreme Court ruling
2. Section 17-51.1, Plan Freeze; New Benefit Structure, is being amended to include the effective date of the benefit freeze
3. Section 17-52, Membership, is being amended to limit the individuals eligible to opt-out of the system, to comply with IRC regulation requirements
4. Section 17-56, Benefit Amounts and Eligibility, is being amended to change the Normal Retirement date to include IRC language regarding Normal Retirement Age and Normal Retirement Date. Additionally to add the effective date of the benefit freeze.
5. Section 17-58, Disability, is being amended to more clearly identify individuals who may be eligible to apply for a disability pension that have been terminated by the city for medical reasons. Also, to add the effective date of the benefit freeze
6. Section 17-65, Maximum Pension, is being amended to comply with IRC standards
7. Section 17-65.11, Prior Police Service, is being amended to correct a reference
8. Section 17-65.13, Deferred Retirement Option Plan (DROP), is being amended to comply with the IRS relating to recent Favorable Determination Letters which clarify investment returns on accounts and add sections which clarify the DROP provisions and to add the effective date of the benefit freeze. Also, amended the provisions related to when interest is calculated and paid.