06/01/2000
TRUSTEES OF THE EMPLOYEES' PENSION FUND SPECIAL MEETING
CITY OF CLEARWATER
June 1, 2000
Present: Brian J. Aungst Chair
J. B. Johnson Vice-Chair/Trustee
Ed Hooper Trustee
Robert Clark Trustee
Ed Hart Trustee
Also present: Michael J. Roberto City Manager
Pamela K. Akin City Attorney
Scott Christiansen Pension Trustees Attorney
Paul O'Rourke Human Resources Administrator
Cynthia E. Goudeau City Clerk
Patricia O. Sullivan Board Reporter
The Chair called the meeting to order at 5:04 p.m. at City Hall.
To provide continuity for research, items are in agenda order although not necessarily
discussed in that order.
ITEM #2 - Approval of Minutes:
Trustee Hooper moved to approve the minutes of the May 15, 2000, meeting, as
motion
recorded and submitted in written summation by the City Clerk to each Trustee. The
carried
was duly seconded and unanimously.
payment of pension benefits & interest from
ITEM #3 - (Cont’d from 5/15/00) - Approve
Pension Fund
for following retirees: Larry Hahn, Jr., Judi Acker, Terrence Rowe, Emanuel
Hutchinson, Gary Lutman, John Nicholson, & Michael Dandaneau, for total $84,761.72
including reimbursement to Central Insurance Fund of $18,453 that has already been paid
Job-connected disability pensions are subject to offsets for collateral benefits such as
Workers’ Compensation and Social Security so that pension benefits, combined with collateral
benefits, do not exceed 100% of an employee’s average monthly wage. According to recent
Florida Supreme Court and First District Court of Appeals’ decisions, annual Workers’
Compensation permanent total supplemental benefits cannot be included in the pension offset
calculation. The rulings impact the pensions of 7 City retirees. Previously, the City included
the annual cost of living supplemental benefits when computing pension offsets, which
resulted in underpayments of pension benefits to these retirees.
As of May 1, 2000, it is estimated retirees are owed $91,649.87, including $64,911.33 –
additional pension, $7,603.20 - penalties, & $19,135.34 - interest: 1) Judi Acker – $12,782.97
($10,811.52 - pension, $1,081.15 – penalty, $890.30 – interest); 2) Lawrence Hahn, Jr. –
$6,930.27 ($5,614.75 - pension, $561.48 – penalty, $754.04 – interest); 3) Terrence Rowe –
$393.55 ($111.63 - pension, $11.16 – penalty, $270.76 – interest); 4) Emanuel Hutchinson –
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$15,067.21 ($11,017.19 - pension, $2,203.44 – penalty, $1,846.58 – interest); 5) Gary Lutman
– $6,207.60 ($4,903.01 - pension, $980.60 – penalty, $323.99 – interest); 6) John Nicholson –
$19,775.31 ($14,794.09 - pension, $1,727.47 – penalty, $3,253.75 – interest); and 7) Michael
Dandaneau – $30,492.96 ($17,659.14 - pension, $1,037.90 – penalty, $11,795.92 – interest).
Interest owed is estimated.
Staff recommends paying the additional pension benefits and interest from the Pension
Fund. Benefits for Acker, Hahn, and Rowe have been paid from the Central Insurance Fund to
satisfy a Florida Supreme Court mandate and to avoid additional penalties. Staff recommends
the Pension Fund reimburse the Central Insurance Fund $18,453 for those payments. The
Central Insurance Fund will pay all penalties as they resulted from a Florida Workers’
Compensation Statute that impacts the Pension Fund.
Pension Trustees Attorney Scott Christiansen said he had reviewed the court rulings
and staff recommendations. He complimented staff’s research of related issues. He said the
courts probably would rule against a technical argument to exclude four retirees not
represented by the Acker case. He concurred with staff and recommended payment with
interest amounts updated.
It was agreed such payments should not be handled administratively but be presented
to the Pension Trustees for approval. In response to a question, Mr. Christiansen said
payments are retroactive to the Acker case. Concern was expressed the related rulings may
affect additional retirees. Risk Management Specialist Jon Marcin said no other retirees
should be affected as staff has adjusted all Pensions affected by the Barrigan ruling. Since
that ruling, qualifying retirees have received Pension and Workers’ Compensation benefits.
Trustee Hart moved to approve payment of Pension benefits and interest from the
Clearwater Employees Pension Fund, for retirees: Judi Acker, Lawrence Hahn, Jr., Terrence
Rowe, Emanuel Hutchinson, Gary Lutman, John Nicholson, and Michael Dandaneau for a total
of $84,761.72, including reimbursement to the Central Insurance Fund of $18,453 that already
motion
has been paid, and that the appropriate officials be authorized to execute same. The
carried
was duly seconded and unanimously.
ITEM #4 - Approve Chapter 175 and Chapter 185 changes to City of Clearwater Employees'
Pension Plan; authorize staff to proceed with ordinance revision
The Pension Plan must be amended by July 1, 2000, to comply with Florida Chapters
175 and 185, as amended by Chapter 99-1, which require the Pension Plan to adopt all non-
cost amendments and all amendments covered by additional State monies in excess of the
1997 amount. Under this provision, the City’s annual funding requirement, pursuant to Florida
Statutes, would increase by approximately $12,000 on a long term basis: 1) $7,000 for Police
and 2) $5,000 for Firefighters. The State’s annual 175/185 dividend to the City will offset
additional costs. The ordinance will be forwarded to the City Commission for adoption.
Related requirements for firefighters and police officers: 1) early retirement age of 50 &
10 with 3% per year reduction cap; 2) 55 & 10 normal retirement age; 3) normal form of benefit
of life with 10-year guarantee, unless current normal form is of greater value; 4) delete pre-
existing condition exclusion for disability entitlement; 5) limit workers’ compensation set-off so
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that Plan disability benefits are not reduced below the greater of 2% per year of service or 42%
of average monthly compensation calculated with 2% benefit rate; 6) delete reassignment
provision for disability claimants & add provision requiring reassignments be to similar job
classification at no reduction in rank or pay; 7) add presumptions for disability incurred in line
of duty where claims are based on certain infectious diseases, hypertension, heart disease, &
tuberculosis; 8) add optional forms of benefits for disability retirees with normal form having a
10-year guarantee; 9) add 66 2/3% joint & survivor option; 10) add forfeiture provisions for
commission of certain specified offenses that are breaches of the public trust & where an
attempt is made to obtain a pension benefit by fraud, misrepresentation, or false statements;
11) add buy-back provision allowing members who terminate employment & withdraw their
contributions, an opportunity if reemployed, to buy prior service time by depositing
contributions with interest within 90 days of reemployment; 12) credited service must be given
members who separate from service to go into military active duty & are reemployed within 1
year after discharge for up to 5 years of military service; and 13) if members’ employment is
terminated, their contributions remain in the Plan, & they are reemployed within 5 years, their
new service time will bridge to their prior service time.
Mr. Christiansen said the Pension Plan’s Actuary Steve Metz had estimated the cost of
these changes. Discussion ensued regarding the effects of presumptions for disability claims
based on certain diseases. The Pension Plan must provide clear and convincing evidence that
proves another cause, such as a family history of hypertension. As HIV is not an included
disease, claimants must provide clear and convincing evidence to prove infection had occurred
in the line of duty.
Trustee Johnson moved to approve Chapter 175 and Chapter 185 changes to the
City’s Employees’ Pension Plan and authorize staff to proceed with ordinance revision. The
motioncarried
was duly seconded and unanimously.
ITEM #5 - Other Business – None.
ITEM #6 - Adjournment
The meeting adjourned at 5:20 p.m.
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