TO: Honorable Mayor & Members of the North Port Commission
FROM: Jonathan R. Lewis, ICMA-CM, City Manager
TITLE: Ordinance 2016-02, first reading; an Ordinance of the City of North Port, Florida, amending Chapter 2, Article V, Division 6, of the North Port Code entitled "Firefighters' Pension", implementing the provisions of the 2015-2018 Collective Bargaining Agreement between the City of North Port and the Suncoast Professional Firefighters and Paramedics, Local No. 2546, IAFF.
Recommended Action
Approve and continue to second reading.
Background Information
With the approval of the 2015-2018 Collective Bargaining Agreement (CBA) between the City of North Port and the Suncoast Professional Firefighters and Paramedics, Local No. 2546, IAFF, the parties to the agreement approved the following changes to the Firefighters’ Pension Plan;
• The City will join the Florida Retirement System (FRS) for Firefighters on October 1, 2015, or as soon thereafter as administratively practical.
• In a subsequent ballot, all current employees will be able to individually elect to continue participating in the City Firefighters’ Pension Plan (City Plan), and continue to earn benefits under the City Plan or join FRS.
o Employees who elect to join FRS will be vested in their accrued pension benefit based on each employee’s credited service and average final compensation under the City Plan on the day before the date the City joins FRS, and the employee’s pension benefit will be frozen at that time.
o Employees who elect to join FRS, the employee’s frozen pension benefit will be payable at the current early or normal retirement date and separation from City employment (early retirement will be subject to the same conditions and benefit reductions as provided in the current City Plan).
o Employees who elect to join FRS may obtain a refund of their employee contributions or accrued benefit under the City Plan.
• All firefighters hired on or after the date the City joins FRS will become members of FRS.
• All Chapter 175 premium tax revenues received on or after the effective date up to $250,000 per year will continue to be used to reduce the City’s pension contribution.
• Premium tax revenues in excess of $250,000 per year will continue be allocated to the share plan.
• Average Final Compensation will be calculated on the best five (5) years of compensation.
• Early retirement benefits (similar to the Police Pension) will be included wherein the members will pay for any increased costs (10.6% member contribution) associated with the benefit and any reduction in costs will be mutually agreed upon by the parties.
Ordinance 2016-02 has been promulgated to implement the provision of the 2015-2018 CBA between the City of North Port and the Suncoast Professional Firefighters and Paramedics, Local No. 2546, IAFF. The Ordinance has been drafted by the City’s pension firm; Lewis, Longman & Walker, P.A., reviewed by the City Attorney as to form and correctness and reviewed by the Firefighters’ Pension Board attorney, Jim Brantley of Donnelly & Gross, P.A.
Strategic Plan
Financially Responsible City Providing Quality Municipal Services
Financial Impact
The City’s Actuary estimated the following cost/expenses based on the Pension Plan’s Actuarial assumptions:
• If all current members who are not eligible to retire elect to join FRS an estimated savings of $180,000 can be expected.
• If all current members with five (5) or more years of service elect to stay in City pension plan, no additional cost are likely.
• If all current members with (10) or more years of service elect to stay in City pension plan, $145,000 savings are estimated.
The actuary’s estimates assume that the actuarial assumptions and methods of the pension board remain constant and are achieved. The pension board’s actuarial assumptions and methods can be found as attachment 3.
Procurement
Attachments:
1. Ordinance 2016 - 02 Legislative format
2. Ordinance 2016 - 02 Final Format
3. Actuarial Assumptions and Methods
Prepared by: Daniel Schult
Department Director: Jonathan Lewis