Res No 213-15-14552RESOLUTION NO.213-15-14552
A Resolution authorizing the City Manager to expend an amount not to exceed
$12,000 with Gabriel Roeder Smith &Company to perform an Actuarial Projection
Study of the City's General and Police Employee's Pension Plan.
WHEREAS,Gabriel,Roeder,Smith &Company will prepare actuarial projection
study(s)for the City's General Employee's PensionPlanas directed by the City Manager;
and,
WHEREAS,the actuarial projections study(s)are required for the City's American
Federation of State,County and Municipal Employees (AFSCME)and Police Benevolent
Association negotiations;and,
WHEREAS,the City of South Miami continues to work in studying and
completing projections usingGabriel Roeder Smithand Company (GRS),the City's
pension plan actuary;and,
WHEREAS,the Cityis not only reviewing and studying benefit and cost
projections related to the Florida Retirement System (FRS),but also reviewing at effects
of amending the City's existing current retirement benefit plans.
NOW THEREFORE BE IT RESOLVED BY THE MAYOR AND CITY COMMISSION OF
THECITYOF SOUTH MIAMI,FLORIDA THAT;
Section 1.The City Manager is authorized to expend an amount not to exceed
$12,000withGabrielRoederSmith&CompanytoperformanActuarialProjectionStudy
of the City of South Miami General and Police Employee's Pension Planon behalf of the
City,charging account 001.1410.513.3100,Finance Professional Services.
Section 2.This resolution shall take effect immediately upon adoption.
PASSEDANDADOPTED thisl 5thdav ofDecember 2015
ATTEST:
CITY CLERK
READ AND AP£Rt3\/BD AS TO
LANGUA^ttGAUTY AN[
lytimxym thereof^
APPROVED
COMMISSION VOTE:5-0
Mayor Stoddard:yea
Vice Mayor Harris:Yea
Commissioner Edmond:Yea
Commissioner Liebman:Yea
Commissioner Welsh:Yea
South1'Miami
THE QTY OF PLEASANT LIVING
OFFICE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
To:
From:
Date:
Subject:
Background:
Amount:
Account:
Attachments:
The Honorable Mayor &Members of the City Commission
Steven Alexander,City Manager
December 15,2015 Agenda Item No.:11
A Resolution authorizing the City Manager to expend an amount
not to exceed $12,000 with Gabriel Roeder Smith &Company to
perform an Actuarial Projection Study of the City's General and
Police Employee's Pension Plan.
Gabriel,Roeder,Smith&Company will prepare actuarial
projection study(s)for the City's General and Police Employees
Pension Planas directed by the City Manager.The actuarial
projection study(s)are required for the City's American
Federation of State,County and Municipal Employees (AFSCME)
and Police Benevolent Association negotiations.
TheCityofSouthMiami continues to work in studying and
completingprojectionsusing Gabriel RoederSmithandCompany
(GRS),the City'spensionplanactuary.TheCityis not only
reviewing and studying benefit and cost projections related to the
Florida Retirement System (FRS),but also reviewing at effects of
amending the City'sexisting current retirement benefit plans.
The City ofSouth Miami has previously usedGabriel,Roeder,
Smith&Companyasa consultant on multiple impact studies and
projections andallmost recent actuarial valuation reports are
producedby Gabriel,Roeder,Smith&Companyusing the City's
existing retirement data.
An amount not to exceed $12,000.
001.1410.513.3100,Finance Professional Services,with a current
balance of $5,443.
Resolution for approval
GabrielRoederSmith&Company's engagement letter.
GRS Gabriel Roeder Smith&Company One East Broward Blvd.954.527.1616 phone
Consultants &Actuaries Suite 505 954.525.0083 fax
Ft.Lauderdale,FL 33301-1804 www.gabricirocder.com
December 3,2015
Mr.Alfred Riverol
Finance Director
City Hall,1st Floor
6130 Sunset Drive
South Miami,Florida 33143
Re:Engagement Letter for Actuarial Services-ActuarialProjection Study
Dear Alfred:
Asrequested,Gabriel,Roeder,Smith&Company(GRS)ispleasedtopresentthisengagement
lettertoperformanActuarialProjectionStudyoftheCity of SouthMiamiPensionPlan(Plan)
on behalf oftheCity.
Weareenthusiasticaboutextendingourexistingrelationshipwithyouandyourcolleagues.We
havealong-standingcommitmentandexperiencewithworkingon behalf of publicsector
benefitprograms.Ourphilosophyofdevelopingapartnershipwithourclientsemphasizesthe
collaborative nature of theGRSworkingrelationship.Westriveto earn your trust as your
advisor.Wewillcontinueto work together withyouinthebest interest of the interested parties.
Description of Services
TheprofessionalserviceswillbeprovidedunderthesupervisionofLarryWilson,A.S.A.,E A.,a
SeniorConsultantandActuarywithover25years ofexperienceinemployeebenefitplans,Kelly
Adams,A.S.A.,E.A.,aConsultantand'Actuarywithover15years of experiencewithemployee
benefitplansandJenBorregard,E.A.,aConsultantandActuarywithover 15 years of experience
with retirement systems.
WeunderstandtheCityisinterestedinanalyzingtheimpactofthefollowingproposedchanges
inPlan provisions:
>PoliceOfficeremployeecontributionswillbecappedateightpercent(8%)or tenpercent
(10%)of compensation.
>Re-opentheplanforGeneralEmployeeswiththefollowingnewTierofbenefit
provisions:
o General Employees become vestedupon completion often (10)yearsof service.
oThe benefit multiplierwillbe .1.6%foreachyearofservice.
oFinalAverage Compensation willbethehighesteight(8)years of compensation.
Mr.Alfred Riverol
December 3,2015
Page Two
o Normal Retirement willbeattainment of age65 or completion of thirty three (33)
years of service.
oGeneralEmployeecontributionswillbecappedatten percent (10%)of
compensation for current General Employees inthePlan.General Employees
joining theplanonorafterOctober 1,2014 willbe required tocontributethree
percent (3.0%)of compensation.
oNo cost-of-living adjustmentswillbeprovided.
>Generalemployeesinthecurrentdefinedbenefitplanwillhaveaone-timeoptionto
freeze their currentbenefit and join thenew Tier benefits shown above.
oGeneralEmployeecontributionswillbecappedattenpercent (10%)of
compensation forcurrentGeneral Employees inthe Plan not exercising this
option.
oFor purposes of thisStudy,100%of employees currently accruingbenefitsinthe
Planare assumed nottoexercisethisoption.
>TwothirdsofnewGeneralEmployeesandcurrent employees intheDefined
ContributionplanwilljointhedefinedbenefitplanunderthenewTierbenefitprovisions.
>Provideadefmedbenefitpensionplanfor employees designatedasmembersofthe
Administration ManagementServiceClasswith die followingbenefitprovisions:
o Participants willbe 100%vestedupon completion ofthree(3)yearsofservicefor
initialmembersasofdateof adoption.Newparticipantswillbe 100%vested
uponcompletionofthree(3)or five(5)or eight(8)years of service.
oThebenefitmultiplierwillbe3.0%foreachyearofservice.
o Final Average Compensation willbethe highest eight(8)years of compensation.
oNormalRetirementwillbe attainment ofage65 or completion ofthirtythree(33)
years of service.
o Employees willbe required to contribute seven percent(7.0%)of compensation.
o Employees whowillreceivetheabovebenefitsandwhoarecurrentlya
participant inthePlanwillhavetheirPlanbenefitsfrozenas of thedate of
adoptionofthisnewAdministrationManagementServicePlan.
oForpurposesofthis Study,all employees eligible forthese benefits willjointhis
new Administration Management Service Planandnolonger participate inthe
DefinedContributionplan.
>Alternative Defmed Contribution plan offered toall General Employees
o Employees willbe required to contribute threepercent(3%)of compensation
oTheCitywill contribute sevenpercent(7%)of compensation
o Employees willbevestedafter completion ofone(1)yearofservice
GabrielRoederSmith5c Company
Mr.Alfred Riverol
December 3,2015
Page Three
>Onethirdofnew General Employees andcurrent employees intheDefinedContribution
planwilljointhe Alternative Defined Contribution plan.
ThisActuarialProjectionStudywillincludethe development of30-yeardeterministic
projectionsmeasuringtheimpact of theproposedchanges.
Proposed Fees
Weproposea not-to-exceed fee of $12,000.Ourfeeincludesonemeetingwiththeinterested
partiesto present thekeyfinancialresults.
Other Items
Please provide alisting of employeeswhowillbeparticipantsinthe Administration
Management Service Plan.
Timing
WewilldeliverourActuarialProjectionStudywithinsixty(60)daysfollowingauthorizationto
proceed and receipt of requested data.
Wetrusttheaboveisresponsivetoyourrequest.Pleasedonothesitatetocontactusshouldyou
haveanyquestionsorrequireadditional information.Welookforwardtoyourapprovalto
proceedandtoassistingtheCity of SouthMiamiwiththis important project.
Sincerest regards,
Lawrence F.Wilson,A.S.A
Senior Consultant and Actuary
Gabriel Roeder Smith &Company