Davie Police Officers' Pension Plan

ASSUMPTIONS & PROVISIONS

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ASSUMPTIONS & PROVISIONSWelcome to the Davie Police Officers' Pension Plan - Assumptions & Provisions Page. As a participant in the Davie Police Officers' Pension Plan, you are included in a program of benefits to help you meet your financial needs in retirement, or in the event of disability or death. The purpose of this booklet is to give you a brief description of benefits available to you under your pension plan.

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Table XI
TOWN OF DAVIE POLICE PENSION PLAN
Outline of Principal Provisions of the Plan

1. Effective Date

May 1, 1976. The most recent plan amendment recognized was Ordinance 2007- 36.

2. Eligibility Requirements

Effective August 6, 1981, all Police employees in the regular full-time service of the Town are eligible upon the attainment of age 18. Part-time employees who work less than 20 hours per week or five (5) months per year are excluded from participation in the plan.

3. Benefit Service

Service of a member from employment date through termination date measured in years and completed months. A member may buy back up to a total of four (4) years of prior military and sworn police service by paying the true actuarial cost of the increase service.

4. Basic Compensation

Basic rate of salary paid to an employee including longevity pay and assignment pay but excluding overtime, bonuses and commissions. Payments for unused leave time (vacation, sick leave, etc.) are excluded. Effective October 1, 2001, basic compensation includes up to 70 hours of overtime pay per year. Effective October 1, 2003, basic compensation includes up to 120 hours of overtime pay per year. The limit on overtime hours increased to 150 hours effective October 1, 2006.

5. Final Average Earnings (FAE)

Final Average Earnings is defined as the higher of (i) average monthly rate of basic compensation during the final thirty-six (36) successive calendar months of Benefit Service, or (ii) average monthly rate of basic compensation of the best five (5) of the last ten (10) years of Benefit Service, preceding actual retirement or termination.

6. Employee Contributions

7.0% of basic compensation.

7. Normal Retirement Date

The first of the month coincident with or next following the earlier of (i) completion of 20 years of Benefit Service or (ii) the attainment of age 55. For a vested terminated member with at least 15 years of Benefit Service, full deferred accrued benefit would be payable on the first of the month coincident with or next following the anniversary of the date that the member would have completed 20 years of Benefit Service.

8. Amount of Normal Retirement Income

The monthly amount of retirement income, payable in the normal form of payment, to a member who retires on his normal retirement date, will be determined as follows:

The monthly retirement income is equal to 3.0% times FAE multiplied by the years and months of Benefit Service for the first 10 years, plus 4.0% times FAE for the next five (5) years of Benefit Service, plus 5.0% times FAE for the next five (5) years of Benefit Service, plus 2.0% of FAE times the next 10 years of Benefit Service. The maximum benefit is limited to 95% of FAE. However, after 47½ years of Benefit Service, benefits shall recommence at a rate of 2.0% of FAE per year.

9. Early Retirement Date

Attainment of age 50 and completion of 10 years of Benefit Service.

10. Amount of Early Retirement Income

The monthly amount of retirement income, payable in the normal form of payment, to a member who retires on his early retirement date, will be determined as follows:

The monthly retirement income is equal to 3.0% times FAE multiplied by the years and months of Benefit Service for the first 10 years, plus 4.0% times FAE for the next five (5) years of Benefit Service, plus 5.0% times FAE for the next five (5) years of Benefit Service, plus 2.0% of FAE times the next 10 years of Benefit Service. The benefit will be reduced for early payment so that it is actuarially equivalent to the normal retirement benefit.

The member also has the option of deferring the commencement of his monthly benefit to his Normal Retirement Date, the earlier of the date he would have attained 20 years of Benefit Service (provided he has completed 15 years of actual Benefit Service) or age 55. In such case, there would be no actuarial reduction to his monthly benefit.

11. Delayed Retirement Date

A member may continue to work beyond his Normal Retirement Date and retire on any subsequent first day of the month.

12. Amount of Delayed Retirement Income

The monthly amount of retirement income, payable in the normal form of payment, to a member who retires on his delayed retirement date, will be determined as follows:

The monthly retirement income is equal to 3.0% times FAE multiplied by the years and months of Benefit Service for the first 10 years, plus 4.0% times FAE for the next five (5) years of Benefit Service, plus 5.0% times FAE for the next five (5) years of Benefit Service, plus 2.0% of FAE times the next 10 years of Benefit Service. The maximum benefit is limited to 95% of FAE. However, after 47½ years of Benefit Service, benefits shall recommence at a rate of 2.0% of FAE per year.

13. Benefits on Termination of Service

In the event of termination of service prior to Normal Retirement Date, for reasons other than death, early retirement or disability, a monthly benefit will be payable commencing on Normal Retirement Date, equal to 3.0% times FAE multiplied by the years and months of Benefit Service for the first 10 years, plus 4.0% times FAE for the next five (5) years of Benefit Service, plus 5.0% times FAE for the next five (5) years of Benefit Service, plus 2.0% times FAE for the next 10 years of Benefit Service thereafter.

Years of Benefit Service	Vested Percentage
Less than 10	0%
10 or more	100%

In lieu of this deferred benefit, a member may elect to receive the return of his employee contributions.

In determining a member’s vested percentage, only actual years as a sworn police officer with the Town are counted.

14. Disability Retirement Benefits

For a member totally and permanently disabled where the disability is service-connected, the monthly benefit shall be equal to the greater of (i) 66-2/3% of such member's base pay at time of disability, less any benefits payable by Federal Old Age, Survivors and Disability Insurance, Worker's Compensation benefits or other disability benefits payable from Broward County or the Town because of disability, age or unemployment, or (ii) forty-two percent (42%) of FAE payable as a ten year certain and life annuity. The monthly non-service connected benefit is the greater of $100 or 1.5% times FAE multiplied by the number of years of Benefit Service, less any of the offset amounts described above. In no event will the service-connected benefit be less than the non-service connected benefit. Benefits shall be payable starting six (6) months after termination of service for disability, and will be payable for life or until recovery.

15. Death Benefits

a. Prior to retirement: If death is non-service connected or member had no spouse to whom he had been married to for at least one (1) year prior to death, the death benefit shall be the return of accumulated employee contributions plus prior plan benefits, if any. However, if a member had at least 10 years of Benefit Service at the time of death, then his or her beneficiary will be entitled to the benefits otherwise payable to the member at Early or Normal Retirement Date.

If death is service-connected and member has an eligible spouse to whom he had been married to for at least one (1) year prior to death, such spouse shall be entitled to a monthly annuity equal to the greater of (i) 50% of base pay at his date of death, or (ii) accrued benefit payable to the eligible spouse on the date of what would have been the member’s Normal Retirement Date. Such pension shall continue to the spouse until the earlier of the spouse's death or remarriage, with a guarantee that such benefits will at least equal the accumulated contributions at his date of death. If a member had no eligible spouse but had at least 10 years of Benefit Service at the time of death, then his or her beneficiary will be entitled to the benefits otherwise payable to the member at Early or Normal Retirement Date.

b. After retirement: If a member had elected a joint and survivor or a 10 year certain and life optional form of payment, the adjusted monthly benefit will be continued to the beneficiary until the appropriate annuity ending date. Total benefits payable the member and his beneficiary will not be less than the amount of accumulated contributions at date of retirement.

16. Normal Form of Retirement Income

For a married participant, the normal form of retirement income will be monthly payments for life of the member, with benefit continuing to spouse after member’s death for one (1) year and 60% of benefit payable to spouse thereafter. The benefit amount is not reduced due to this form of payment. The participant may also elect to receive the benefit as an unreduced ten year certain and life annuity. For an unmarried participant, the normal form of payment will be an unreduced ten year certain and life annuity.

17. Optional Forms of Retirement Income

The following optional forms of retirement income may be elected by a member without presenting evidence of good health:

Option 1 - A single life annuity payable during the lifetime of the participant only.

Option 2 - A retirement annuity payable to the member during the joint lifetime of the member and a joint pensioner designated by the member, and following the death of either of them, 50%, 66-2/3%, 75%, or 100% depending on the retiree's election, of such smaller monthly amount payable to the survivor for the lifetime of the survivor.

Option 3 - A monthly annuity payable to the member for ten years certain and life thereafter.

18. Deferred Retirement Option Plan (DROP)

The DROP is available only if the member makes an irrevocable election to participate prior to the attainment or within five (5) years of attaining normal retirement eligibility. The DROP has a five (5) year maximum participation period, after which the employee is deemed separated from the Town. In no event can a member who enters the DROP exceed 25 years of total Benefit Service plus years of DROP participation. If the member dies or becomes disabled during the DROP period, the member will have presumed to have retired on a normal retirement on the day prior to disability or death.

19. Cost of Living Adjustments (COLA)

An annual COLA will be provided to retirees and beneficiaries. The amount of the COLA will be 2.0% per year. For recipients who retired prior to October 1, 1997, the monthly benefit after the yearly COLA will not exceed 115% of the original monthly benefit prior to any COLA. For post October 1, 1997 retirees, the limit for future monthly benefits after COLA will be 130% of the original benefit amounts prior to any COLA. The first annual COLA will commence on the fifth anniversary of retirement, but no earlier than November 1, 2004.

20. Changes from Most Recent Valuation

None.