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01/09/1997 (2) PAC Pension Advisory Committee Minutes ??ll PENSION ADVISORY COMMITTEE CITY OF CLEARWATER January 9, 1997 Present: Rita Garvey J. B. Johnson Richard Breest Robert Clark Pat Greer Dick Fitzgerald Pat Shepler Leslie Dougall-Sides Michael Laursen Debbie Ford Patricia O. Sullivan The Chair called the meeting to order at 9:00 a.m. at the Municipal Services Building. To provide continuity for research, items are in agenda order although not necessarily discussed in that order. eau* v Member Johnson moved to approve the minutes of the regular meeting of December 12, 1996, as corrected. The motion was duly seconded and carried unanimously. ITEM-43 - Empll2ygga to be Heard - None. a.) Review and Action on Employee Requests for Years of Service Pension 1) Richard A. Trombly - Police Officer, Police Department - years of service designation - hazardous duty provision AND 2) Sandy L. Stevens - Police Officer, Police Department - years of service designation - hazardous duty provision On page 4, a reference to the January meeting should have stated "1997." Chair/Mayor Vice Chair/Commissioner Committee Member Committee Member/Commissioner Committee Member Committee Member Committee Member Assistant City Attorney Human Resources Director Human Resources Technician Board Reporter Member Johnson moved to approve a Years of Service Pension for Richard A. Trombly and a Years of Service Pension for Sandy L. Stevens. The motion was duly seconded and carried unanimously. mpac01.97 1 01/09/97 b) Review and Action on Employees' Requests for Vesting Pension 1) Christine Papandreas - former Planning Department Employee Christine Papandreas, employed by the City from December 16, 1974, to December 4, 1992, applied for a Vested Rights Pension and requested receiving a reduced pension beginning September 21, 2002. Human Resources Director Michael Laursen said Ms. Papandreas had contacted payroll regarding this issue. Although she qualified to be vested after 10 years of employment, she never had applied formally for vesting. She will qualify to receive a reduced pension when she reaches her 55th birthday. Ms. Papandreas has been advised and she understands her pension will be based on the rate in effect at the time of her resignation. It was recommended that the City's separation procedure include the completion of vesting paperwork by all qualified employees who resign and do not accept distribution of their Pension benefits. Human Resources and Payroll staff are working to determine if similar cases exist. AND 2) Cindy L. Trombly - Police Officer, Police Department Cindy L. Trombly, employed by the City from August 27, 1979, to January 10, 1997, applied for a Vested Rights Pension and requested receiving a reduced pension beginning September 1, 2001. Mr. Laursen reviewed Ms. Trombly's employment with the City, noting she did not work as a Police Officer until 1981. She qualifies to receive a reduced pension upon the 20th anniversary of her employment in hazardous duty. The need for PAC (Pension Advisory Committee) oversight of vesting matters was questioned. It was suggested vesting be handled administratively. In response to a question, Mr. Laursen reviewed the Pension Plan's retirement requirements. He said historically, vested employees with hazardous duty designations can collect Pension benefits 20 years after they began their hazardous duty employment even if they do not complete 20 years of hazardous duty. These employees can collect benefits before reaching their 55th birthday. Discussion ensued. Concerns were expressed that vested hazardous duty employees can qualify for the 20 year retirement benefit even though.they may have worked only 11 years. It was felt employees should serve 20 years of hazardous duty before qualifying for the benefit of earlier retirement. Concern was expressed regarding the impact on the plan of a young person's retirement when that person did not serve 20 years of hazardous duty. It was noted this issue is a benefit negotiated with the unions. It was stated employees who have served the City at least 10 years in a hazardous duty have qualified for this benefit. Mr. Laursen and the Legal Department will research this issue and report back to the PAC for further discussion. W mpac01.97 2 01/09/97 Member Breest moved to approve requests by Christine Papandreas and Cindy L, Trombly to vest their pensions. The motion was duly seconded and carried unanimously. c) Approval of New Hires as Pension Plan Members Human Resources Director Mike L,aursen said he had reviewed all physician recommendations and reported all listed new hires meet Pension Plan criteria. Member Fitzgerald moved to accept the following employees into membership in the Pension Plan: Date of Pension Employment Ella.-Date. David Sharpe, Police Service Tech Police Department 12/09/96 12/09/96 Deborah J. Mobley, Police Svc. Tech Police Department 12/09/96 12/09/96 Pamela McGarry, Police Service Tech Police Department 12/09/96 12/09/96 Mary Jo Fox, Police Service Tech Police Department 06/27/94 12109/96 Nat 0. Medlin, Police Service Tech Police Department 06/24/96 12/09/96 The motion was duly seconded carried unanimously, Don McMullen E? Don McMullen, a former City Police Officer, is a pensioner on a job-connected disability related to a back injury. Mr. McMullen has indicated intent to accept a position with the Department of the Treasury, Inspection and Control Division attached to the U.S. Customs Service as a "Canine Enforcement Officer." Police Captain Paul Maser reviewed the position description and indicated the position is similar to that of a Clearwater Police Officer. Assistant City Attorney Leslie Dougall-Sides concurred, noting many duties are alike. While Canine Enforcement Officers do not carry guns, a proficiency with firearms is required. She said according to code, job-connected disability benefits are forfeited upon acceptance of a similar job. The code in place before January 1, 1996, contained no provision for forfeiting benefits if the disability improves. Pensioners with job-connected disabilities approved before January 1, 1996, can accept any position other than one that is similar to their previous City job. Consensus was the "Canine Enforcement Officer" position Donald McMullen has proposed to accept is similar to that of the position of a City Police Officer and would disqualify Mr. McMullen from receiving future disability benefits. Ms. Dougall-Sides said a formal procedure regarding this situation has not been approved. She recommended notifying Mr. McMullen and providing him an opportunity to be heard before the PAC. Discussion ensued regarding his appearance. Ms. Dougall-Sides said Mr. McMullen is responsible for all expenses related to his appearance before the PAC mpac01.97 3 01/09/97 and any representation. It was suggested staff obtain a copy of the curriculum and physical training information from the school he attended in Virginia. Consensus was for Mr. I-aursen to contact Mr. McMullen, requiring a reply prior to the February 13, 1997, meeting, regarding his employment intentions considering PAC concerns that his acceptance of the "Canine Enforcement Officer" position conflicts with his ability to collect future disability benefits from the Pension Plan. Mission Statement It was suggested the PAC develop a mission and values statement to help employees understand the PAC's duties. Beneficiary Benefits It was noted when employees retire, they can choose the percentage benefit their beneficiaries will receive after they die. Option 6 provides beneficiaries with a 1000% rate for life. Concern was expressed that the beneficiaries of employees who die before making that choice are forced to accept a retirement benefit of 5 years at 100% of the survivor annuity and 50% thereafter. It was recommended that vested employees have the opportunity to choose an option prior to retirement. Concern was expressed that some employees may wish to change their option often. It was suggested the PAC should not be involved with estate planning. Mr. Laursen said this benefit is tied to the collective bargaining process. ITEM ##7 - Director's Reports a) Kenneth Donagan - Proposal for Pension Buy Back The PAC previously approved Kenneth Donagan's Pension Buy-Back request. The Pension Plan requires a payback to be the greater: a) full amount previously distributed plus interest at rate of 5% per annum from distribution date to repayment date, or b) actuarial present value of accrued benefit previously forfeited. On May 23, 1996, Mr. Donagan was notified the actuarial value for the 9.4 years he requested to buy-back was $247,854. In December 1996, Mr. Donagan filed an age discrimination complaint with the EEOC (Equal Employment Opportunity Council). In a meeting with EEOC, City representatives agreed to convey to the PAC Mr. Donagan's offer to pay back Option b? for a total payback of $17,723.92, and not the greater of the two options as stated in the ordinance. Concern was expressed approval of this request would affect all other buy-back requests. Ms. Dougall-Sides noted others who qualified for buy-backs had not filed complaints with the EEOC. The EEOC could have dismissed Mr. Donagan's claim. If the PAC refuses Mr. Donagan's offer, the EEOC can dismiss the claim or issue a cause for determination, entitling Mr. Donagan to bring suit against the City. The claim was filed against the City, not the PAC or Pension Trustees. She said there is a possibility the fund could end up being liable. She noted Mr. Donagan's claim did not identify how the discrimination is related to his age and that point was not clarified at the hearing. mpac01.97 4 01/09/97 E Mr. Laursen said the City testified the PAC had not denied Mr. Donagan's buy-back request. At the time City management determined Mr. Donagan could not rejoin the Pension Plan because of State age restrictions, he did not pursue the issue with the PAC. Ms. Dougall-Sides felt the statute of limitations regarding that issue has expired. In response to a question, Mr. Laursen said the PAC had denied Lois Maroon's buy-back request to pay nothing for her buy back. It was felt the PAC should enforce the ordinance's buy-back provisions. This issue will be brought to the Pension Trustees should the EEOC rule to proceed. When another computation pattern was suggested, Ms. Dougall-Sides indicated the ordinance lists only two computation methods. It was indicated Steve Metz of Coopers and Lybrand computed the actuarial amount based on accepted actuary practices. Member Clark moved to authorize a City representative to advise the EEOC the PAC did not accept Mr. Donagan's offer, noting the ordinance's provisions. The motion was duly seconded. Members Johnson, Breest, Clark, Fitzgerald, and Shepler and Chair Garvey voted "Aye"; Member Greer voted "Nay." Motion carried. Pension Entitlement Review and Re-examination Procedure Copies of the Pension Entitlement Review and Re-Examination Procedure will be distributed to PAC members prior to the February 13, 1997, meeting. Change of meeting location It was suggested the PAC meetings be held in the conference room of the City Offices until City Hall reopens. Consensus was to change the meeting location if the space is available. The meeting adjourned at 10:14 a.m. mpac01.97 Chair Pension Advisory Committee 5 01/09/97 ,.,