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OCEAN CITY-WRIGHT FIRE CONTROL DISTRICT FIREFIGHTERS' PENSION TRUST FUND SECTION 112.664, FLORIDA STATUTES COMPLIANCE DETERMINED AS OF THE OCTOBER 1, 2019 VALUATION DATE
OCEAN CITY-WRIGHT FIRE CONTROL DISTRICT FIREFIGHTERS' PENSION TRUST FUND
SECTION 112.664, FLORIDA STATUTES COMPLIANCE DETERMINED AS OF THE
OCTOBER 1, 2019 VALUATION DATE
February 19, 2020
VIA E-MAIL
Jennifer Benedict, SecretaryOcean City-Wright Fire Control District Firefighters’ Pension Trust Fund233 Racetrack Rd. NE.Ft. Walton Beach, FL 32547
Re: Ocean City-Wright Fire Control District Firefighters' Pension Trust FundSection 112.664, Florida Statutes Compliance
Dear Jennifer:
Please find enclosed the annual disclosures that satisfy the October 1, 2019 financial reporting requirements made under Section 112.664.
Our office will submit this information electronically to the Department of Management Services. However, it is important for you to be aware that this report must also be made available on the Plan or Plan Sponsor’s website, if such website exists. A deadline for this website publication is not made clear in the law.
In addition to the enclosed report, the Plan or Plan Sponsor's website must provide a link to the Division of Retirement's Actuarial Summary Fact Sheet for the Plan, and also report the previous five years' assumed and actual rates of return, along with their respective asset allocations. The Board should contact its Investment Consultant for this information.
With respect to the reporting standards for defined benefit retirement plans or systems contained in Section 112.664(1), F.S., the actuarial disclosures required under this section were prepared and completed by me or under my direct supervision and I acknowledge responsibility for the results. To the best of my knowledge, the results are complete and accurate, and in my opinion, meet the requirements of Section 112.664(1), Florida Statutes, and Rule 60T-1.0035, Florida Administrative Code.
If there are any questions, concerns, or comments about any of the items contained in this report, please feel free to contact me.
Respectfully submitted,
Foster & Foster, Inc.
By: _________________________
Drew D. Ballard, EA, MAAA Enrolled Actuary #17-8193
Enclosures cc via email: Stu Kaufman, Board Attorney
13420 Parker Commons Blvd., Suite 104 Fort Myers, FL 33912 · (239) 433-5500 · Fax (239) 481-0634 · www.foster-foster.com
When reviewing the following schedules, please note the following:
1) The purpose of producing this report is solely to satisfy the requirements set forth by Section112.664, Florida Statutes, and is mandatory for every Florida public pension fund, excluding theFlorida Retirement System (FRS).
2) None of the schedules shown have any impact on the funding requirements of the Plan. Theseschedules are for statutory compliance purposes only.
3) In the schedules that follow, the columns labeled “ACTUAL” represent the final recorded GASB67/68 results. The columns labeled “HYPOTHETICAL” illustrate what the results would havebeen if different assumptions were used.
4) It is our opinion that the Plan’s actual assumptions utilized in the October 1, 2019 ActuarialValuation Report, as adopted by the Board of Trustees, are reasonable individually and in theaggregate, and represent our best estimate of future Plan experience.
5) The “Number of Years Expected Benefit Payments Sustained” calculated in Section II: AssetSustainability should not be interpreted as the number of years the Plan has left until it isinsolvent. This calculation is required by 112.664, Florida Statutes, but the numeric result isirrelevant, since in its calculation we are to assume there will be no further contributions to theFund. As long as the Actuarially Determined Contribution is made each year the Plan will neverbecome insolvent.
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INTRODUCTION Section 112.664, F.S. Requirements
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ACTUAL
7.25% 5.25% 9.25%RP-2000 RP-2000 RP-2000
Generational Generational Generational
Total Pension LiabilityService Cost 373,451 605,186 240,389 Interest 1,531,397 1,439,499 1,559,934 Change in Excess State Money - - - Changes of Benefit Terms (1,123) (1,422) (912) Differences Between Expected and Actual Experience (774,466) (1,023,364) (588,424) Changes of Assumptions - - - Benefit Payments, Including Refunds of Employee Contributions (1,080,159) (1,080,159) (1,080,159) Net Change in Total Pension Liability 49,100 (60,260) 130,828 Total Pension Liability - Beginning 21,290,472 27,355,350 17,164,749 Total Pension Liability - Ending (a) 21,339,572$ 27,295,090$ 17,295,577$
Plan Fiduciary Net PositionContributions - Employer 951,325 951,325 951,325 Contributions - State 260,766 260,766 260,766 Contributions - Employee 175,244 175,244 175,244 Net Investment Income 514,898 514,898 514,898 Benefit Payments, Including Refunds of Employee Contributions (1,080,159) (1,080,159) (1,080,159) Administrative Expenses (38,628) (38,628) (38,628)
Net Change in Plan Fiduciary Net Position 783,446 783,446 783,446 Plan Fiduciary Net Position - Beginning 13,213,327 13,213,327 13,213,327 Plan Fiduciary Net Position - Ending (b) $ 13,996,773 $ 13,996,773 $ 13,996,773
Net Pension Liability - Ending (a) - (b) 7,342,799$ 13,298,317$ 3,298,804$
SCHEDULE OF CHANGES IN NET PENSION LIABILITYFISCAL YEAR SEPTEMBER 30, 2019
HYPOTHETICAL
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SECTION I - GASB Section 112.664, F.S. Requirements
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Fiscal Year Beginning 10/1
Projected Beginning Fiduciary Net Position
Projected Total Contributions
Projected Benefit Payments
Projected Administrative
Expense
Projected Investment Earnings
Projected Ending Fiduciary Net Position
2019 13,996,773 - 1,273,087 - 968,617 13,692,303 2020 13,692,303 - 1,308,662 - 945,253 13,328,894 2021 13,328,894 - 1,338,897 - 917,810 12,907,807 2022 12,907,807 - 1,384,959 - 885,611 12,408,459 2023 12,408,459 - 1,386,738 - 849,344 11,871,065 2024 11,871,065 - 1,446,785 - 808,206 11,232,486 2025 11,232,486 - 1,498,451 - 760,036 10,494,071 2026 10,494,071 - 1,495,388 - 706,612 9,705,295 2027 9,705,295 - 1,572,605 - 646,627 8,779,317 2028 8,779,317 - 1,549,923 - 580,316 7,809,710 2029 7,809,710 - 1,534,390 - 510,582 6,785,902 2030 6,785,902 - 1,540,444 - 436,137 5,681,595 2031 5,681,595 - 1,554,168 - 355,577 4,483,004 2032 4,483,004 - 1,560,406 - 268,453 3,191,051 2033 3,191,051 - 1,619,031 - 172,661 1,744,681 2034 1,744,681 - 1,636,608 - 67,162 175,235 2035 175,235 - 1,622,196 - - -
Number of Years Expected Benefit Payments Sustained: 16.11
This projection assumes no further contributions, assumes no further benefit accruals, and assumes Market Value of Assets earn 7.25% interest.
It is important to note that as long as the Actuarially Determined Contribution is made each year, the Plan will never become insolvent.Furthermore, State and local laws mandate that the Actuarially Determined Contribution be made each year.
Table 1Plan Assumptions: 7.25% and RP-2000 Generational Mortality
PROJECTION OF THE NUMBER OF YEARS ASSETS WILL SUSTAIN BENEFIT PAYMENTS
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SECTION II - ASSET SUSTAINABILITY Section 112.664, F.S. Requirements
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Fiscal Year Beginning 10/1
Projected Beginning Fiduciary Net Position
Projected Total Contributions
Projected Benefit Payments
Projected Administrative
Expense
Projected Investment Earnings
Projected Ending Fiduciary Net Position
2019 13,996,773 - 1,273,087 - 701,412 13,425,098 2020 13,425,098 - 1,308,662 - 670,465 12,786,901 2021 12,786,901 - 1,338,897 - 636,166 12,084,170 2022 12,084,170 - 1,384,959 - 598,064 11,297,275 2023 11,297,275 - 1,386,738 - 556,705 10,467,242 2024 10,467,242 - 1,446,785 - 511,552 9,532,009 2025 9,532,009 - 1,498,451 - 461,096 8,494,654 2026 8,494,654 - 1,495,388 - 406,715 7,405,981 2027 7,405,981 - 1,572,605 - 347,533 6,180,909 2028 6,180,909 - 1,549,923 - 283,812 4,914,798 2029 4,914,798 - 1,534,390 - 217,749 3,598,157 2030 3,598,157 - 1,540,444 - 148,467 2,206,180 2031 2,206,180 - 1,554,168 - 75,028 727,040 2032 727,040 - 1,560,406 - - -
Number of Years Expected Benefit Payments Sustained: 13.47
This projection assumes no further contributions, assumes no further benefit accruals, and assumes Market Value of Assets earn 5.25% interest.
It is important to note that as long as the Actuarially Determined Contribution is made each year, the Plan will never become insolvent.Furthermore, State and local laws mandate that the Actuarially Determined Contribution be made each year.
PROJECTION OF THE NUMBER OF YEARS ASSETS WILL SUSTAIN BENEFIT PAYMENTS
Table 2Hypothetical Assumptions: 5.25% and RP-2000 Generational Mortality
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SECTION II - ASSET SUSTAINABILITY Section 112.664, F.S. Requirements
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Fiscal Year Beginning 10/1
Projected Beginning Fiduciary Net Position
Projected Total Contributions
Projected Benefit Payments
Projected Administrative
Expense
Projected Investment Earnings
Projected Ending Fiduciary Net Position
2019 13,996,773 - 1,273,087 - 1,235,821 13,959,507 2020 13,959,507 - 1,308,662 - 1,230,729 13,881,574 2021 13,881,574 - 1,338,897 - 1,222,122 13,764,799 2022 13,764,799 - 1,384,959 - 1,209,190 13,589,030 2023 13,589,030 - 1,386,738 - 1,192,849 13,395,141 2024 13,395,141 - 1,446,785 - 1,172,137 13,120,493 2025 13,120,493 - 1,498,451 - 1,144,342 12,766,384 2026 12,766,384 - 1,495,388 - 1,111,729 12,382,725 2027 12,382,725 - 1,572,605 - 1,072,669 11,882,789 2028 11,882,789 - 1,549,923 - 1,027,474 11,360,340 2029 11,360,340 - 1,534,390 - 979,866 10,805,816 2030 10,805,816 - 1,540,444 - 928,292 10,193,664 2031 10,193,664 - 1,554,168 - 871,034 9,510,530 2032 9,510,530 - 1,560,406 - 807,555 8,757,679 2033 8,757,679 - 1,619,031 - 735,205 7,873,853 2034 7,873,853 - 1,636,608 - 652,638 6,889,883 2035 6,889,883 - 1,622,196 - 562,288 5,829,975 2036 5,829,975 - 1,625,229 - 464,106 4,668,852 2037 4,668,852 - 1,606,262 - 357,579 3,420,169 2038 3,420,169 - 1,634,215 - 240,783 2,026,737 2039 2,026,737 - 1,611,881 - 112,924 527,780 2040 527,780 - 1,587,448 - - -
Number of Years Expected Benefit Payments Sustained: 21.33
This projection assumes no further contributions, assumes no further benefit accruals, and assumes Market Value of Assets earn 9.25% interest.
It is important to note that as long as the Actuarially Determined Contribution is made each year, the Plan will never become insolvent.Furthermore, State and local laws mandate that the Actuarially Determined Contribution be made each year.
PROJECTION OF THE NUMBER OF YEARS ASSETS WILL SUSTAIN BENEFIT PAYMENTS
Table 3Hypothetical Assumptions: 9.25% and RP-2000 Generational Mortality
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SECTION II - ASSET SUSTAINABILITY Section 112.664, F.S. Requirements
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ACTUAL
7.25% 5.25% 9.25%RP-2000 RP-2000 RP-2000
Generational Generational Generational
Minimum Required Contribution (Fixed $) $1,283,347 $1,839,722 $862,767
Minimum Required Contribution (% of Payroll) 44.5% 63.9% 29.9%
Expected Member Contribution 201,795 201,795 201,795
Expected State Money 257,332 257,332 257,332
Expected Sponsor Contribution (Fixed $) $824,220 $1,380,595 $403,640
Expected Sponsor Contribution (% of Payroll) 28.6% 48.0% 14.0%
ASSETS
Actuarial Value ¹ 13,558,608 13,558,608 13,558,608 Market Value ¹ 13,996,773 13,996,773 13,996,773
LIABILITIES
Present Value of Benefits Active Members Retirement Benefits 10,815,870 16,410,387 7,591,263 Disability Benefits 121,156 172,717 89,049 Death Benefits 60,684 86,443 43,924 Vested Benefits 1,011,584 1,839,034 590,300 Refund of Contributions 241,196 263,018 222,041 Service Retirees 12,838,905 15,824,466 10,744,264 Beneficiaries 0 CK! 0 CK! 0 Disability Retirees 498,634 652,640 401,528 Terminated Vested 888,071 1,298,269 639,013 Share Plan Balances ¹ 0 0 0 Total: 26,476,100 36,546,974 20,321,382
Present Value of Future Salaries 24,531,137 27,916,309 21,875,461
Present Value of Future Member Contributions 1,717,180 1,954,142 1,531,282
Total Normal Cost 546,367 881,821 352,968
Present Value of Future Normal Costs (Entry Age Normal) 4,430,080 8,246,429 2,523,766
Total Actuarial Accrued Liability ¹ 22,046,020 28,300,545 17,797,616
Unfunded Actuarial Accrued 8,487,412 14,741,937 4,239,008 Liability (UAAL)
HYPOTHETICAL
ACTUAL AND HYPOTHETICAL CONTRIBUTIONS APPLICABLE TO THE FISCAL YEARENDING SEPTEMBER 30, 2021
Valuation Date: 10/1/2019
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SECTION III - FUNDING Section 112.664, F.S. Requirements
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ACTUAL
7.25% 5.25% 9.25%RP-2000 RP-2000 RP-2000
Generational Generational Generational
HYPOTHETICAL
ACTUAL AND HYPOTHETICAL CONTRIBUTIONS APPLICABLE TO THE FISCAL YEARENDING SEPTEMBER 30, 2021
Valuation Date: 10/1/2019
PENSION COST
Normal Cost (with interest) 566,173 904,969 369,293
Administrative Expenses (with interest) 53,953 53,433 54,474
Payment Required To Amortize UAAL (with interest) 663,221 881,320 439,000
Minimum Required Contribution $1,283,347 $1,839,722 CK! $862,767
¹ The asset values and liabilities include accumulated Share Plan Balances as of 9/30/2019.
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SECTION III - FUNDING Section 112.664, F.S. Requirements
