2011 General Employees Pension Summary Plan Description VILLAGE OF NORTH PALM BEACH
GENERAL RETIREMENT FUND
SUMMARY PLAN DESCRIPTION
Prepared September,2011
2
INTRODUCTION TO YOUR PLAN
Your Employer has established a defined benefit pension plan to provide eligible employees with
retirement and related benefits.
This Summary Plan Description is a brief description of your Plan and your rights, obligations and
benefits under that Plan. This Summary Plan Description is not meant to interpret, extend or change the
provisions of your Plan in any way. The provisions of your Plan may only be determined accurately by
reading the actual Plan document.
A copy of your Plan is on file at your Employer's office and may be read by you,your beneficiaries
or your legal representatives at any reasonable time. If you have any questions regarding either your Plan or
this Summary Plan Description, you should ask your Plan's Administrator. In the event of any discrepancy
between this Summary Plan Description and the actual provisions of the Plan,the Plan shall govern.
3
GENERAL INFORMATION ABOUT YOUR PLAN
There is certain general information you may need to know about your Plan. This general
information is summarized below.
Name of Plan
Village of North Palm Beach General Retirement Fund
Employer
Village of North Palm Beach
Plan Administrator
Board of Retirement
General Retirement Fund
501 U.S.Highway One
North Palm Beach,Florida 33408
Trustee
Plan Administrator
Pension Administrator
The day-to-day operation of the Plan is handled by the Village's Finance Director, who has been
named Pension Administrator by the Village's Council. Any questions about the Plan or requests for
benefits should be directed to the Pension Administrator.
Designated Agent for Service of Legal Process
Chairperson of the Retirement Board
Type of Administration
The Plan Administrator is responsible for the overall administration of the Plan. It has discretionary
authority to construe the terms of the Plan and make determinations on questions which may affect your
eligibility for benefits. The Plan Administrator may also retain the services of attorneys, accountants,
actuaries,investment advisors and other professionals.
4
Plan Year
The Plan's fiscal records are maintained on an annual basis, namely each 12 month period
beginning on October 1 st and ending on September 30th.
Relevant Provisions of Local and State Laws
The Plan is set forth in Chapter 2,Article V,Division 3 of the Village of North Palm Beach Code of
Ordinances.
The most recent restatement and amendment to the Plan reflected in this Summary Plan Description
is Ordinance No.2010-07.
Your Plan is also governed by certain provisions of Part VII, Chapter 112, Florida Statutes (F.S.),
and various federal laws.
Relevant Provisions of Collective Bargaining Agreements
Certain employees covered by the Plan are members of the Federation of Public Employees. The
current collective bargaining agreement between the unit and the Employer covers the period from October
1,2010 through September 30,2013.
Custodian
The custodian of the Plan is responsible for the safe-keeping of securities owned by the Pension
Fund. At the direction of the Plan Administrator, the custodian also pays benefits to eligible persons and
pays expenses incurred by the Plan. The custodian is:
Sun Trust Bank
Orlando,Florida
Investment Manner(s)
The investment manager is responsible for selecting the securities to be bought and sold by the
Pension Fund, in accordance with guidelines established by the Plan Administrator. The investment
manager is:
Sun Trust Bank
Orlando,Florida
5
Member
A Member is each employee of the Employer who is eligible to participate in the Plan and who
fulfills the prescribed eligibility requirements and makes contributions if required.
Beneficiary
A Beneficiary means the person or persons identified by you to receive benefits under the Plan.
You should designate a Beneficiary when you become a Member of the Plan. You may change your
designation at any time upon written notification to the Plan Administrator. It is each Member's
responsibility to keep their named Beneficiary accurate and up to date. If no such designation is in effect at
the time of your death or if no such person so designated is living at that time,the Beneficiary shall be your
estate.
6
CONTRIBUTIONS TO THE PLAN
Benefits of the Plan are financed by contributions that are paid into the pension fund and by
investment earnings generated by investment of the pension fund. Contributions to the fund are made by:
You
Your contribution rate depends upon your date of hire and your decision to participate in various
benefit options that have become available since 1996. The table below summarizes the possible
contributions as a percentage of your covered salary. (See later page for defmition of covered salary.)
Your Plan Election
2% Benefit 2.25% Benefit 2.5% Benefit
Benefitj Benefit Benefit Benefit Benefit Benefit
Only WCOLA Only w/COLA Only w/COLA
d Prior to 3/29/96 0% 2% 2% 4% 4% 6%
C 3/29/96 to 5/11/00 N/A N/A 2% 4% 4% 6%
d
0 5/12/00 to 12/11/03 N/A N/A 2% 4% 4% 6%
After 12/11/03 N/A N/A N/A N/A N/A 6%
Regardless of the rate that applies to you,your contribution will cease upon your retirement, death,
or employment termination. Effective October 1, 1996,your contributions to the Plan are tax deferred.
Your Employer
The Employer must contribute an amount determined by the Plan's actuary to be sufficient, along
with your contribution and any investment earnings to fund systematically the benefits under the Plan. The
Employer's contributions will vary depending upon the experience of the Plan.
7
ELIGIBILITY AND CREDITED SERVICE
Eligibility
You are eligible to be a Member of the Plan if you are a general employee of the Employer and you
do not choose to participate in the Village's defined contribution plan. Your employment must be full-time,
as determined by the Employer.
The following Village employees may not become Members of the Plan:
Employees of the Fire Department and Police Department who are members of the Fire and
Police Retirement Fund.
Credited Service
Credited Service is used to compute the amount of pension benefit when you retire, to determine
whether you are eligible for certain benefits and to determine whether you are vested. Your Credited
Service is equal to your total number of completed years plus the fractional parts of years of actual service
with the Employer. Vacations and other paid leaves of absence are included. Unpaid leaves of absence are
not included.
Break in Service
If you terminate employment and return to work for the Employer within two years, your previous
service will be included in Credited Service. If you are rehired more than two years after your date of
termination,you will not receive credit for your previous service.
Military Service
Should you take a granted leave of absence from the Employer in order to enter the military, your
period of leave will be included in your Credited Service if you return to work for the Employer within one
year from the date of your discharge and pay the fund what you would have contributed had you remained
an employee. The maximum credit for military service shall be five years. Your active duty in the military
prior to date of hire by the Employer is not included in Credited Service.
8
RETIREMENT DATES
Normal Retirement Date
The Normal Retirement Date is the earliest date when unreduced retirement benefits may be paid.
Your Normal Retirement Date is the first day of the month coincident with or next following the date when
you reach age 60 and complete nine years of Credited Service. If you opted to remain in the prior
(noncontributory)Plan in March, 1996,your Normal Retirement Date is the date when you reach age 65.
Early Retirement Date
Your Early Retirement Date is the date when you reach age 55. You may retire at any time
following this date with reduced benefits as described later.
Late Retirement Date
You may continue to work past your Normal Retirement Date. The date you actually stop working
will be your Late Retirement Date.
9
RETIREMENT BENEFITS
Normal Retirement Benefit
The monthly benefit that you will receive if you continue in employment until your Normal
Retirement Date is called your Normal Retirement Benefit.
The amount of your Normal Retirement Benefit is based on the following factors:
1. Your Covered Salary - This is the amount of your gross compensation including overtime
but excluding bonuses or any other non-regular payments such as unused sick leave and
vacation time.
2. Your Average Monthly Salary - This is the average of your Covered Salary during the five
years within your last ten years of employment which produces the largest average. If you
are employed for fewer than five years, the average is taken over the period of your actual
employment.
3. Your years of Credited Service at your Normal Retirement Date.
4. Your Plan Benefit Rate - This rate varies depending on your date of hire and various
options that you elected since 1996. The following table summarizes the various benefit
rates:
Benefit Rate Table
Original Opt In Opt In
Date of Hire Rate 3/28/96 12/11/03
Prior to 3129/96 2.00% 2.25% 2.50%
3/29/96 to 12/11/2003 N/A 2.25% 2.50%
After 12/11/03 N/A N/A 2.50%
The calculation of your Normal Retirement Benefit is as follows:
Your Plan Benefit Rate multiplied by your Average Monthly Salary multiplied by your
years of Credited Service up to 20 years,plus 1% of the Average Monthly Salary for each
year of Credited Service in excess of 20 years.
As an example,if your Average Monthly Salary at your Normal Retirement Date is equal to
$3,000, your Credited Service is equal to 22 years, and you elected to opt in to the benefit
plan in December 2003,then the calculation would be as follows:
10
(2.50% x $3,000 x 20 years)+(1%x$3,000 x 2 years)_ $1560.00
This would be your Normal Retirement Benefit payable each month.
The retirement benefit is paid to you for the rest of your life in accordance with the Normal Form of
Benefit Payment as described later (however, see the sections on Death Benefits After Retirement and
Election of Optional Forms of Benefit Payments). Your benefits from this Plan are paid in addition to any
benefits you may receive from Social Security.
Accrued Benefit
The portion of your Normal Retirement Benefit that you have earned at any point in time is called
your Accrued Benefit. Your Accrued Benefit is computed in the same way as the Normal Retirement
Benefit, using your Average Monthly Salary and Credited Service as of the date of the calculation. The
Accrued Benefit is a monthly amount which starts on your Normal Retirement Date.
Early Retirement Benefit
If you decide to retire early, your Early Retirement Benefit will be payable for your life
commencing on the first day of the month coincident with or next following your date of termination. The
benefit is equal to your vested Accrued Benefit but reduced for the number of months by which the starting
date of the benefit precedes your otherwise Normal Retirement Date. The benefit is reduced to take into
account the younger age and earlier commencement of benefit payments. The following table shows how
much your benefit will be reduced if payments begin before your Normal Retirement Date:
Number of Percentage
Years Early Reduction
1 5%
2 10
3 15
4 20
5 25
6 30
7 35
8 40
9 45
10 50
11
Late Retirement Benefit
The amount of your monthly Late Retirement Benefit is calculated and paid in the same way as the
Normal Retirement Benefit. Your Average Monthly Salary and Credited Service as of your actual
retirement date are used in the calculation.
Cost Of Living Adiustment
Each October I" pension payments will be adjusted to reflect the change in the Consumer Price
Index for the 12 month period ending April 1. The maximum increase in your benefit in any one year is 3%.
This provision applies to all employees hired after May 11,2000, and for other employees opting to pay the
additional 2%of pay contribution required for this provision.
12
DISABILITY RETIREMENT
The Plan does not provide for benefits in the event of disability. You may be eligible for a regular
benefit if you are vested or if you have reached retirement age.
13
SURVIVOR BENEFITS
Before Retirement
If you are actively employed and you pass away before your Normal Retirement Date with at least
five years of Credited Service, your Vested Retirement Benefit (see next page) will be paid, regardless of
your age,to your Beneficiary on a monthly basis for ten years. This benefit will not be reduced by the 5%
early retirement penalty.
If you are no longer an employee of the Village, you have not received a refund of your own
contributions and you pass away after you have reached age 55 and completed five years of Credited
Service, the Plan will pay a survivor benefit as though you had retired on your date of death and elected a
50%joint and survivor annuity.
After Retirement
If you were receiving a form of retirement payment which provided for a survivor's benefit to be
paid after your death, your Beneficiary will receive payments following your death. A later page describes
the various forms of retirement payments.
14
VESTED RETIREMENT BENEFIT
If you terminate employment, other than by reason of retirement, disability or death, you may be
entitled to a deferred Vested Retirement Benefit. This benefit is equal to your Accrued Benefit on your
termination date multiplied by your vested interest. The following chart shows your vested interest in your
Accrued Benefit.
Vesting,
Schedule
Completed Years Vested
of Credited Service Interest
Less than 5 0%
5 50
6 50
7 75
8 75
9 or more 100
The vested benefit is payable at your Normal Retirement Date, or after reduction, at your Early
Retirement Date (Age 55). In lieu of your deferred vested benefit, you may receive a refund of your
contributions. If you terminate employment with less than five years of Credited Service,you will receive a
refund of your contributions.
15
FORMS OF BENEFIT PAYMENTS
Normal Form of Benefit Payment
Unless you elect otherwise before retirement, your pension is payable as a Single Life Annuity.
This is a series of monthly payments for your life after which all payments will stop.
Election of Optional Forms of Benefit Payments
You have the right at any time before your actual retirement date to elect not to have your
retirement benefit paid in the Normal Form. You may choose among the options described below and
revoke any such elections and make a new election at any time before actual retirement. You must make
such an election by written request to the Plan Administrator. This election also applies to terminated
Participants who are eligible for payment of deferred Vested Retirement Benefits. The options available are
as follows:
1. Option 1-Joint and Last Survivor Annuity
You may elect to receive a decreased monthly retirement benefit during your lifetime and
have such decreased retirement benefit (or a designated fraction thereof but at least 50%)
continued after your death to and during the lifetime of your Beneficiary.
2. Option 2-Ten Year Certain and Life Thereafter Annuity
You may elect to receive a decreased retirement benefit with at least 120 monthly payments
guaranteed. If you die before receiving 120 payments, the payments will continue until a
total of 120 payments have been made. If you live longer than ten years,monthly payments
are continued for the rest of your life,ceasing upon your death.
3. Option 3-Other
You may elect another optional form which is subject to the approval of the Plan
Administrator and which is actuarially equivalent to the Normal Form of Benefit.
4. Option 4-Social Security Adjustment Option
You may elect to receive an increased benefit until the date your Social Security benefit
begins and then a decreased amount thereafter.
16
5. Option 5—Lump Sum Payment
You will only receive this option in the event that the present value of your vested accrued
benefit is under$5,000 at the time you terminate employment.
17
AMENDMENT OR TERMINATION OF THE PLAN
The Plan may be amended or terminated at any time by the Employer. If the Plan were terminated,
you would immediately become fully vested in the benefit you had earned so far. You would receive the
single sum value of your accrued benefit or an annuity contract covering your accrued benefit. Only after
all accrued benefits have been paid and any other liabilities have been satisfied could any remaining money
be returned to the Employer.
18
IMPORTANT NOTICE
There are certain circumstances which may result in the disqualification, ineligibility, denial, loss,
forfeiture, suspension or deferral of your benefits in this Plan. The following is a list of these
circumstances:
1. If you terminate employment before Early or Normal Retirement Date and you do not have
enough Credited Service to have earned a vested interest,no benefits will be payable except
for a return of your own contributions.
2. If you die before attaining a vested interest,no benefits will be payable except for a return
of your own contribution.
3. No credit is allowed either for benefit accrual or vesting purposes for any period in which
you are not considered a full-time employee, with the exception of up to five years of
military service provided that you return to full-time employment with the Village within
one year of the date of your military discharge and deposit into the Plan the same sum that
you would have contributed if you had remained a full-time employee.
4. Your retirement benefit will not be payable until actual retirement date, even if you
continue to work beyond the Normal Retirement Date.
5. Your Accrued Benefit may be forfeited if you are convicted of certain felonies as provided
by State Law(Chapter 112.3173 F.S.).
6. Payment of your benefits may be subject to an income deduction order made pursuant to a
state domestic relations law.
7. All benefits are forfeited if you receive a return of your own contributions.
19
YOUR RESPONSIBILITIES
1. Retain this Summary Plan Description with your other important papers for later reference
or for replacement by updated versions and supplemental notices,if any.
2. Upon completing eligibility requirements, sign a Membership Form, including a
Beneficiary designation.
3. Keep your Beneficiary designation form updated to express your wishes.
4. If you terminate employment, check to see if you are entitled to a Vested Retirement
Benefit and the date payable.
5. If you should terminate employment with rights to a deferred Vested Retirement Benefit,
then, shortly before the date on which it is to begin, you should contact and notify the
Employer to begin such payments.
6. Prior to your retirement under Early or Normal Retirement, complete the form necessary to
indicate which Optional Form of Benefit you desire.
20
CLAIMS AND PROCEDURES
Claims for benefits under the Plan must be filed in writing with the Pension Administrator. If you
are eligible for any benefits fiom this Plan, you will be provided with a notification form showing the
amount of your benefit and options,if any,and the earliest date on which such benefit is payable.
Your request for Plan benefits shall be considered a claim for Plan benefits, and it will be subject to
a full and fair review. If your claim is wholly or partially denied, the Plan Administrator shall famish you
with a written notice of its denial. This written notice will state the Plan Administrator's findings and
conclusions.
If your claim has been denied, and you wish to submit your claim for review,you may file with the
Pension Administrator a request for rehearing and review by the Plan Administrator.
As soon as practicable after the Pension Administrator receives your request for a rehearing, the
Plan Administrator shall meet after giving you notice. You have the right to be present at this meeting with
legal counsel,if you desire. You will be allowed to submit any evidence in support of your claim.
The Plan Administrator's decision on your claim for review shall be communicated to you in
writing and shall include specific references to the pertinent Plan provisions on which the decision was
based. If the Plan Administrator's decision on review is not furnished to you within the time limitations
described above,your claim shall be deemed denied on review.
21
PERTINENT ACTUARIAL INFORMATION
AS OF OCTOBER 1
2010 2009
Number of Members of the Plan
Active Members (Current Employees) 64 63
Inactive Members (Members Receiving or
Due to Receive Benefits) 55 57
Annual Payroll of Active Members $ 3,424,324 $ 3,046,421
Annual Rate of Benefits in Pay Status 29,649 29,649
Actuarial Accrued Liability for Plan Benefits 10,516,549 8,328,331
Net Assets Available for Benefits(Actuarial Value) 6,863,057 6,048,808
Required Contribution to be Made to the Plan Over and
Above Contributions by Members of the Plan: 696,946 499,954
Required Contribution as %of Payroll of
Active Members 19.57 % 15.78 %
Required Contribution to be Paid During
Year Ending 9/30/12 9/30/11
22
INCOME AND DISBURSEMENTS
September 30
Item 2010 2009
A. Market Value of Assets at Beginning of Year $ 5,208,323 $ 5,014,956
B. Revenues and Expenditures
1. Contributions
a. Employee Contributions $ 163,213 $ 154,640
b. City Contributions 759,529 765,381
c. Purchased Service Credit - -
d. Total $ 922,742 $ 920,021
2. Investment Income
a. Interest,Dividends, and Other Income $ 12,159 $ 19,437
b. Realized Gains/(Losses) (72,611) (144,787)
c. Unrealized Gains/(Losses) 587,492 351,392
d. Investment Expenses (42,037) (36,533)
e. Net Investment Income $ 485,003 $ 189,509
3. Benefits and Refunds
a. Refunds $ - $ (7,879)
b. Regular Monthly Benefits (29,509) (35,845)
c. Lump Sum Distributions (314,984) (856,211)
d. Total $ (344,493) $ (899,935)
4. Administrative and Miscellaneous Expenses $ (15,448) $ (16,228)
C. Market Value of Assets at End of Year $ 6,256,127 $ 5,208,323