Fort Walton Beach Ordinance — 2219-Amending COO Section 2.09 Police Officers' Retirement Fund Board — reading text

READING DATE 1st o i6 2nd ORDINANCE 2219 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF FORT WALTON BEACH, FLORIDA, AMENDING THE CITY CODE OF ORDINANCES AT SECTION 2. 09, POLICE OFFICERS' RETIREMENT FUND BOARD, SUBSECTION 2. 09. 03, POLICE OFFICERS' RETIREMENT FUND; ADDING SUBSECTION ( DD), DEFERRED RETIREMENT OPTION PLAN; TO PROVIDE AN OPTION FOR MEMBERS TO HAVE A FIVE- YEAR DROP PERIOD; PROVIDING THAT EACH AND EVERY OTHER SECTION AND SUBSECTION OF SECTION 2. 09 SHALL REMAIN IN FULL FORCE AND EFFECT AS PREVIOUSLY ADOPTED; REPEALING ALL ORDINANCES IN CONFLICT HEREWITH; PROVIDING FOR SEVERABILITY; PROVIDING FOR CODIFICATION; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Fort Walton Beach (" City") currently provides benefits to the Police Officers in its City of Fort Walton Beach Police Officers' Retirement Fund ( the Fund"); and WHEREAS, the City desires to add a Deferred Retirement Option Plan ( DROP) to the existing plan document; and WHEREAS, the City Council has determined that providing this benefit is in the best interest of the City as well as the Members and beneficiaries of the Fund. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WALTON BEACH, FLORIDA, THAT: SECTION 1. That Section 2.09. 03, Police Officers' Retirement Fund, of the Code of Ordinances of the City of Fort Walton Beach is hereby amended by adding subsection ( dd), Deferred Retirement Option Plan, to read as follows: dd) Deterred Retirement Option Plan. 1) Definitions. As used in this section ( dd), the following defmitions apply. a. DROP: The City of Fort Walton Beach Police Officers' Retirement Fund, Deferred Retirement Option Plan. b. DROP Account: The notional account established for each DROP participant under subsection ( 2) c.  c. Total Return of the Assets: For purposes of calculating earnings on a Member' s DROP Account pursuant to subsection ( 3) b. 2., for each fiscal ear quarter, the percentage increase ( or decrease) in the interest and dividends earned on investments, including realized and unrealized gains or losses), of the total Plan assets. The actual rate credited will be the Total Return of the Assets. net of investment expenses. d. Net investment return is the total return of the assets in which the Member' s DROP Account is invested by the Board net of brokerage commissions, transaction costs. and management fees. 2) Participation. a. EliitibilitV to Participate. In lieu of terminating their employment as a Police Officer, any Member who is eligible for normal retirement under the System may elect to defer receipt of such service retirement pension and to participate in the DROP. b. Election to Participate. A Member' s election to participate in the DROP must be made in writing in a time and manner determined by the Board and shall be effective on the first day of the first calendar month which is at least 15 business days after it is received by the Board. c. Period of Participation. A Member who elects to participate in the DROP under subsection ( 2) b., shall participate in the DROP for a period not to exceed 60 months beginning at the time the Member' s election to participate in the DROP first becomes effective. An election to participate in the DROP shall constitute an irrevocable election to resign from the service of the City not later than the date provided for in the previous sentence. A Member may participate only once. d. Termination ofParticipation. 1. A Member' s participation in the DROP shall cease at the earlier of: a) the end of the Member' s permissible period of participation in the DROP as determined under subsection ( 2) c.; or  b) termination of the Member' s employment as a Police Officer. 2. Upon the Member' s termination of participation in the DROP, pursuant to subsection ( 2) d. l. above, all amounts provided for in subsection including monthly benefits and investment ( 3) b, earnings or interest, shall cease to be transferred from the System to the Member' s DROP Account. Any amounts remaining in the Member' s DROP Account shall be paid to the Member in accordance with the provisions of subsection (4) when the Member terminates employment as a Police Officer. 3. A Member who terminates their • artici cation in the DROP under this subsection ( 2) d. shall not be permitted to again become a participant in the DROP. e. Eftett of DROP Participation on the System. 1. A Member' s Credited Service and their accrued benefit under the System shall be determined on the date their election to participate in the DROP first becomes effective. The Member shall not accrue any additional Credited Service or any additional benefits under the System (unless specifically provided for in this Plan) while they are a participant in the DROP and Member Contributions will cease. After a Member commences participation. they shall not be permitted to again contribute to the System, nor shall they be eligible for disability or pre- retirement death benefits. 2. No amounts shall be paid to a Member from the System while the Member is a participant in the DROP. Unless otherwise specified in the System, if a Member' s participation in the DROP is terminated other than by terminating their employment as a Police Officer, no amounts shall be paid to the Member from the System until they terminate their employment as a Police Officer. Unless otherwise specified in the System, amounts transferred from the System to the Member' s DROP Account shall be paid directly to the Member only on the termination of their employment as a Police Officer. 3) Funding. a. Establishment of DROP Account. A notional DROP Account shall be  established for each Member participating in the DROP. A Member' s DROP Account shall consist of amounts transferred to the DROP under subsection ( 3) b, and earnings on those amounts. b. Transfers From Retirement System. 1. As of the first day of each month of a Member' s period of participation in the DROP, the monthly retirement benefit they would have received under the System had they terminated their employment as a Police Officer and elected to receive monthly benefit payments thereunder shall be transferred to their DROP Account, except as otherwise provided for in subsection ( 2) d.2. A Member' s period of participation in the DROP shall be determined in accordance with the provisions of subsections ( 2) c. and ( 2) d., but in no event shall it continue past the date they terminate their employment as a Police Officer. 2. Except as otherwise provided in subsection ( 2) d. 2., a member' s DROP account under this subsection ( 3) b. shall be debited or credited with either: a) Interest at an effective rate of four percent ( 4. 0%) per annum compounded monthly determined on the last business day of the prior month' s ending balance and credited to the member' s DROP account as of such date; or b) Earnings, to be credited or debited to the member' s DROP account, determined as of the last business day of each fiscal year quarter and debited or credited as of such dated determined as follows: The average daily balance in a member' s DROP account shall be credited or debited at a rate equal to the net investment return realized by the system for that quarter, but not less than zero percent ( 0. 00%). " Net investment return" for the purpose of this paragraph is the total return of the assets in which the member' s DROP account is invested by the board net of brokerage commissions, transaction costs and management fees. For purposes of calculating earnings on a member' s  DROP account pursuant to this subsection ( 3) b.2, brokerage commissions, transaction costs, and management fees shall be determined for each quarter by the investment consultant pursuant to contracts with fund managers as reported in the custodial statement. The investment consultant shall report these quarterly contractual fees to the board. The investment consultant shall also report the net investment return for each manager and the net investment return for the total plan assets. Upon electing participation in the DROP, the member shall elect to receive either interest or earnings on his account to be determined as provided above. The member may, in writing, elect to change his election only once during his DROP participation. An election to change must be made prior to the end of a quarter and shall be effective beginning the following quarter. c. A Member' s DROP Account shall only be credited with earnings or interest and monthly benefits while the Member is a participant in the DROP. A Member' s final DROP account value for distribution to the Member upon termination of participation in the DROP shall be the value of the account at the end of the quarter immediately preceding termination of participation for participants electing the net plan return and at the end of the month immediately preceding termination of participation for