Okaloosa County BOCC — May 20, 2014 — CAFR_13 — reading text

- 5,255 5,255 Traffic Education - - - - 100,027 100,027 Public Records - - - - 2,548,667 2,548,667 Debt Service - - - - 463,354 463,354 Transportation Projects - - - - 11,039,403 11,039,403 Committed to: Planning Projects 26,808 - - - - 26,808 Park Development Projects - - - 71,660 - 71,660 Municipal Benefits Service Units - - - - 490,939 490,939 Assigned to: Capital Projects - - - 2,764,590 - 2,764,590 Transportation Projects - 171,518 - - - 171,518 Emergency and Disaster Relief - - - - 164,705 164,705 Health Department - - - - 3,168 3,168 Unassigned: Unassigned 6,595,043 - (8,798) - (59,316) 6,526,929 Total Fund Balances $ 6,967,987 $ 192,898 $ 14,329,337 $ 3,426,210 $ 23,417,050 $ 48,333,482 The proprietary fund balance sheet contains the line item “Net Assets Restricted for Other Purposes”. Following is a list of the detail balances contained in that line item for September 30, 2013. Fund Amount Purpose Airport Enterprise Fund $ 6,986,254 Passenger Facility Charges Program Airport Enterprise Fund 2,227,639 Customer Facility Charges Program Convention Center Enterprise Fund 7,673,873 Tourist Development Tax Total Net Assets Restricted for Other Purposes $ 16,887,766 71  Okaloosa County, Florida NOTES TO FINANCIAL STATEMENTS Fiscal Year Ended September 30, 2013 NOTE 13 – ENCUMBRANCES The amount of encumbrances outstanding as of September 30, 2013, is as follows: Amount Governmental Funds General Fund $ 22,678 County Transportation Trust 23,926 Tourist Development 1,825 Other Governmental 45,775 Total $ 94,204 Encumbrances at year end do not constitute expenditures or liabilities; therefore, they are not reflected in the financial statements. NOTE 14 - PENSION PLAN Florida Retirement System Plan Description Okaloosa County contributes to the Florida Retirement System (FRS), a cost-sharing multiple-employer defined benefit pension plan administered by the State of Florida Division of Retirement, Department of Management Services. The FRS provides retirement, disability or death benefits to plan members or their designated beneficiaries. Florida Statutes Chapter 121 provides the authority under which benefit provisions are established. The provisions may only be amended by legislative action. Beginning in 2002, a defined contribution plan alternative to the existing defined benefit plan known as the Public Employee Optional Retirement Program or the FRS Investment Plan became available to FRS members. Members in either plan who have reached normal retirement age may retire and continue employment with the County for up to 60 months. During that period the member’s retirement benefits accumulate in the FRS Trust Fund increased by a cost-of-living adjustment each July and earned interest at an annual rate of 6.5%. The FRS issues a publicly available financial report that includes financial statements and required supplementary information. That report may be obtained on the State of Florida Department of Management Services website at www.dms.myflorida.com. FRS Plan Changes Effective July 1, 2011, the Florida Legislature passed Senate Bill 2100 that made substantive changes to the Florida Retirement System (FRS). The new Bill requires all FRS Investment and Pension Plan members (except those in Deferred Retirement Option Program, DROP) to now pay a 3% employee contribution, on a pretax basis, beginning on or after July 1, 2011. Cost of living adjustments (COLA) on or after July 1, 2011 are not automatic at 3%, but based on total years of service earned prior to July 1, 2011 to total years of service at retirement, multiplied by 3%. New members enrolling into FRS for the first time after July 1, 2011 will be subject to additional changes including 1) an increased vesting period from 6 years to 8 years, 2) a change calculation of benefits using Average Final Compensation (AFC) on the highest eight years of compensation as compared to highest five years. In addition, the normal retirement date for Regular, Senior Management Service, Elected Officers’, and Special Risk Administrative Support Classes was modified to be age 65, with 8 years of service or 33 years of service regardless of age. Normal retirement for Special Risk Class members now at age 60, with 8 years of service, or 30 years of special risk class service or age 57, with 30 years of combined special risk class service and military service. For those members participating in the DROP program, the Legislature reduced the annual interest rate used for benefits from 6.5% to 1.3%. The funding policy relative to the FRS plan is disclosed below. 72  Okaloosa County, Florida NOTES TO FINANCIAL STATEMENTS Fiscal Year Ended September 30, 2013 NOTE 14 - PENSION PLAN - CONTINUED Funding Policy Contribution requirements of the plan are established in Florida Statutes Chapter 121 and may only be amended by legislative action. Effective July 1, 2011, the Florida Legislature passed Senate Bill 2100 requiring all employee members to contribute 3% to the Plan. Formerly, only employers were required to contribute to the FRS Plan. The FRS funding policy now provides for monthly employer and employee contributions at actuarially determined rates that, expressed as percentages of annual covered payroll are adequate to accumulate sufficient assets to pay benefits when due. Level percentages of payroll employer contribution rates, established by state law, are determined using the entry-age actuarial funding method. If an unfunded actuarial liability re-emerges as a result of future plan benefit changes, assumption changes, or methodology changes, it is assumed any unfunded actuarial liability would be amortized over 30 years, using level dollar amounts. Except for gains reserved for rate stabilization, it is anticipated future actuarial gains and losses are amortized on a rolling 10% basis, as a level dollar amount. In July 2002, the Florida Legislature established a uniform contribution rate system for the FRS, which remained in effect with the passage of Senate Bill 2100. The uniform contribution system covers both the FRS Pension Plan and the FRS Investment Plan. Employers and employees contribute a percentage of the total payroll for each class of FRS membership. The current actuarially determined contribution rates expressed as a percentage of covered payrolls are for regular employees 6.95%, special risk employees 19.06%, special risk administrative support 35.96%, elected judges 28.28%, elected county officers 33.03%, senior management service class 18.31%, and 12.84% for the Deferred Retirement Option Program (DROP). The County’s contributions to the plan for the years ended September 30, 2013, 2012, and 2011, listed below were equal to the required contributions for the year. Years Ended September 30, Elected Officials 2013 2012 2011 Board of County Commissioners $ 2,754,506 $ $ 2,297,942 $ $ 3,898,716 Clerk of the Circuit Court 366,186 325,565 450,543 Sheriff 2,153,332 2,017,147 2,887,232 Tax Collector 291,150 241,744 351,338 Property Appraiser 113,642 92,366 161,656 Supervisor of Elections 52,022 40,678 72,291 Total Contributions $ 5,730,838 $ 5,015,442 $ 7,821,776 1 Effective July 1, 2013, the Florida Legislature passed Senate Bill 1810 that sets the employer-paid contribution rates for both FRS and HIS system. The employer-paid contribution rate to pay the normal costs and amortization of the unfunded actuarial liability of the FRS increased. The established rates are based on the rates recommended in the “Blended Rate Study” associated with the 2012 Actuarial Valuation of the FRS. The “Blended Rate Study” covers a thirty-year period, with rates adjusted annually. The contributions will be deposited into the FRS Trust Fund to fund retirement benefits to members participating in the FRS. 73  Okaloosa County, Florida NOTES TO FINANCIAL STATEMENTS Fiscal Year Ended September 30, 2013 NOTE 14 - PENSION PLAN - CONTINUED Health Insurance Subsidy – Continued Health Insurance Subsidy Plan Description The Board of County Commissioners contributes to the Florida Retirement System Health Insurance Subsidy (FRSHIS), a cost-sharing multiple-employer defined benefit pension plan administered by the State of Florida Division of Retirement, Department of Management Services. Florida Statutes provides the authority under which benefit provisions are established. The