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01/04/1993 TRUSTEES OF THE EMPLOYEES' PENSION FUND MEETING January 4, 1993 The City Commission, meeting as the Board of Trustees of the Employees Pension Fund, met in regular session at City Hall, Monday, January 4, 1993 at 9:25 A.M., with the following members present: Rita Garvey Chairperson Richard Fitzgerald Trustee Sue Berfield Trustee Arthur X. Deegan, II Trustee Also Present were: Michael J. Wright City Manager Milton A. Galbraith, Jr. City Attorney Cynthia E. Goudeau City Clerk ITEM #2 - Minutes: Trustee Berfield moved to approve the minutes of the December 14, 1992, meeting. The motion was duly seconded and carried unanimously. ITEM #3 - Request for Acceptance into Membership: The City Manager presented the recommendation of the Pension Advisory Committee to approve membership for the employee(s) listed below: a) Joyce Kirchoffer b) Robert Caldwell c) Belinda L. Wester d) James Atherholt e) Timothy R. Becherer Trustee Berfield moved to accept the recommendation of the Pension Advisory Committee. The motion was duly seconded and carried unanimously. ITEM #4 - Request for Pension: The City Manager presented the recommendation of the Pension Advisory Committee that Cecil M. Henderson, Jr. be granted a regular pension under Section 26.34 and/or 26.37 of the Employees' Pension Plan. Trustee Berfield moved to accept the recommendation of the Pension Advisory Committee. The motion was duly seconded and carried unanimously. ITEM #5 - Request for Pension: The City Manager presented the recommendation of the Pension Advisory Committee that John A. Nicholson be granted a job-connected disability under Section 26.35 of the Employees' Pension Plan. Mr. Nicholson was employed on January 15, 1973 and began participating in the Pension Plan on that date. He suffered a heart attack on April 20, 1992 while on duty. He is requesting a job-connected disability pension based on his heart problem which resulted from the attack he suffered while on duty. Mr. Nicholson has submitted letters from Dr. Alberto E. Montalvo (dated 11/10/92) and Dr. Paul L. Phillips (dated 12/14/92) in support of his request. The letter from Dr. Phillips states Mr. Nicolson "sustained a myocardial infarction ... I consider him to be totally and permanently disable ... completely unemployable and most definitely would not be able to perform the rigorous and stressful functions demanded being employed as a firefighter ..." Dr. Montalvo's letter states "He suffered an acute inferior wall myocardial infarction ... With the above coronary artery disease, he is unable to return to his usual line of work as a firefighter. He is permanently disabled ..." Under the Florida "presumption law", any heart or lung problems suffered by a firefighter is presumed to be job-related. Mr. Nicholson's disability pension was approved by the PAC at their December 16, 1992 meeting. Based on an average salary of approximately $35,129 over the past five years and the 75% minimum disability benefit, Mr. Nicholson's pension will approximate $26,347 annually. Charts from Finance which take into consideration mortality rates and age reflect the "present value cost of financing" this pension will be approximately $294,713. Mr. Nicholson has one child under the age of 18; and, therefore, the dependent child supplement to the pension will be provided for this child. Trustee Berfield moved to accept the recommendation of the Pension Advisory Committee. The motion was duly seconded and carried unanimously. ITEM #6 - Other Business: a) Request by Pension Advisory Committee (PAC) to discuss Carpentieri Pension George Odishoo, newest member of the PAC, asked what documents the Trustees use in making their decisions. H. M. Laursen, Human Resources Director, indicated background information and data are provided on the issues before the Trustees. Mr. Odishoo indicated the PAC uses its Rules and Procedures and the Code as guides as to what their powers are. He indicated no where in these documents was there authorization for the Trustees to hire outside legal representation. In response to a question, he indicated the authority was not explicitly denied. He reviewed what the PAC is charged to do and indicated the Code does not indicate the Trustees can over rule a PAC decision. He questioned how the Trustees reached the decision to deny the Carpentieri job-connected disability pension. Mr. Laursen indicated Deborah Crumbley of Thompson, Sizemore & Gonzalez, the City's Labor attorney, has provided a opinion that the "presumption" law is not a portion of the pension ordinance and it was the prime basis of the PAC's recommendation for the second approval of pension for Mr. Carpentieri. He stated it was the legal opinion that the presumption did not apply as Carpentieri was not an active firefighter at the time of his heart attack. He stated it is important to note it was determined by the Trustees and the PAC that the Trustees can remand decisions to the PAC. He stated another relevant issue is whether the Krysko decision applies, as this was not an original approval of Mr. Carpentieri's pension. Mr. Carpentieri had a regular years of service pension already approved based on 28 years of service. Mr. Odishoo indicated the retirement documents indicate the retirement of Mr. Carpentieri would not be effective until August 31, 1992 and he was using vacation and sick leave which meant he was receiving a regular paycheck, accruing sick leave and the health insurance benefits of a full-time city employee. It was stated the point was that the presumption law could only be applied if the firefighter was on active duty. Mr. Odishoo questioned whether this would apply to any employee on sick leave or vacation. Mr. Laursen indicated there is a clear distinction between this use of vacation and sick leave and an employee on vacation and/or sick leave who is intending to come back to work. He stated when the option form was signed, the employee had no intention of returning to work and was using vacation and sick leave as severance pay. The City Manager indicated the employee had clearly left the job and had no intention of returning to work. He also stated the Commission had approved a special fund to pay salaries of police officers and firefighters remaining on the payroll, due to extending the retirement date through the use of vacation and sick leave, in order to be able to hire a replacement prior to the former employee actually going off the payroll. Mr. Odishoo stated the Trustees have not followed the pension ordinance and there is nothing in the ordinance which allows the Trustees to over ride the PAC decision. He also questioned the Trustees ability to hire an outside attorney. The City Attorney indicated that it is inherent that the Trustees have that ability. It was stated a question has been raised regarding whether or not the PAC has the ability to change its recommendation once it has already approved a pension. Mr. Odishoo reiterated his position that the Trustees could not over ride the PAC decision. In response to a question, Mr. Odishoo indicated he did not know whether the presumption law had been considered by the PAC when it had made its recommendation. Mr. Laursen indicated, in reference to the Krysko case, there has been alot of discussion since that time and it was indicated the Trustees would follow the PAC's decisions. The Trustees do have the ability to remand an item to the PAC and they have not rejected the PAC's recommendation in a normal procedure. It was indicated this was a difficult decision as the Trustees are aware of Mr. Carpentieri's situation however, they felt this was precedent setting. Jim Heinz of the PAC, stated they did make the decision based on the presumption law and there is a question regarding whether or not Mr. Carpentieri was retired. He referred to a memorandum from former Assistant City Manager Jeff Butler, that indicated if the choice is made to extend the retirement date, paychecks have pension deductions taken from them. He stated the presumption law did not require active duty and the case used by Ms. Crumbley as a basis for her opinion had to do with a firefighter who was actually collecting retirement benefits. Mr. Heinz raised a question regarding if this case goes to litigation, how would those costs be paid. It was indicated this would be discussed when and if that circumstance arises. Mr. Heinz indicated he felt strongly that Mr. Carpentieri was not retired at the time of his heart attack and felt that if it would cost more in legal fees to litigate, that the job-connected disability should be granted. Mr. Laursen indicated there have been other cases where a non-job-connected disability was approved by the PAC and the Trustees with an understanding that if additional information was provided, it could come back to be changed to a job-connected disability. He emphasized this was done with the knowledge of the possibility of its coming back from the offset. ITEM #7 - Adjournment: The meeting adjourned at 10:02 a.m.