2002-065RESOLUTION NO. 2002-65
A RESOLUTION OF THE CITY COMMISSION OF THE CiTY OF AVENTURA,
FLORIDA, AUTHORIZING THE CITY MANAGER TO EXECUTE THE
ATTACHED LETTER AGREEMENT BETWEEN CITY OF AVENTURA AND
BUCK CONSULTANTS FOR A PENSION BENEFITS STUDY; AUTHORIZING
THE CITY MANAGER TO DO ALL THINGS NECESSARY TO CARRY OUT
THE AIMS OF THIS RESOLUTION; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City of Aventura, in accordance with applicable State law, has issued an
Invitation to Submit Qualifications (ISQ) for actuarial services; and
WHEREAS, Buck Consultants submitted the only response to the ISQ; and
WHEREAS, a Review Committee consisting of the City Manager, Finance Support
Services Director and Police Chief reviewed Buck's proposed project team, qualifications and
background, and determined that the firm was highly qualified to perform the Pension Benefits
Study; and
WHEREAS, City Staff has negotiated the scope of services and fees contained in the
attached Letter Agreement and recommends approval of said Agreement; and
WHEREAS, the City Commission, upon review, wishes to authorize the City Manager to
execute the Letter Agreement for a Pension Benefits Study.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY
OF AVENTURA, FLORIDA, THAT:
Section 1. The City Commission hereby authorizes the City Manager to execute the
attached Letter Agreement between the City of Aventura and Buck Consultants.
Section 2. The City Manager is hereby authorized to do all things necessary to carry
out the aims of this Resolution.
Section 3. This Resolution shall become effective immediately upon its adoption.
The foregoing Resolution was offered by Commissioner Rogers-Libert, who moved its
adoption. The motion was seconded by Commissioner Berger, and upon being put to a vote,
the vote was as follows:
Commissioner Arthur Berger yes
Commissioner Jay R. Beskin yes
Commissioner Ken Cohen yes
Commissioner Manny Grossman yes
Commissioner Patdcia Rogers-Libert yes
Vice Mayor Harry Holzberg yes
Mayor Jeffrey M. Pedow yes
ResoLution No. 2002- 6~5
Page 2
PASSED AND ADOPTED this 12th day of November, 2002.
T~T~cSA,M~-°
/d'ET:FREY"M. PERLOW, MAYOR
APPROVED AS TO LEGAL SUFFICIENCY:
BUC(
CONSULTANTS'
A Mellon Consulllng Company
200 Galleria Parkway, N.W.
Atlanta, Georgia 30339-5945
November 5, 2002
Suite 1900
LETTER AGREEMENT
PI~rSION BENEFITS STUDy
Mr. Han~ M. Kilgore
Finance Support Services Director
City of Aventura
19200 West CountE¢ Club Drive
Aventura, Florida 33180
Proposed Pension Benefits Study
Dear Mr. Kilgore:
It was a pleasure to meet with you, Police Chief Tom Ribel and City Manager Eric Soroka on
October 22, 2002 to discuss pension benefits for City of Aventura employees. We appreciate the
opportunity to work with you on this project.
We are writing to outline the scope of the study, the proposed timing and fees.
Scope of Study
The study would include:
Survey of pension benefits for general employees and police officers in the following
municipalities and the State of Florida.
-- North Miami
-- North Miami Beach
-- Florida Retirement System
We would research and provide comparison of the most recently available pension information
for these entities including:
Type of pension plans
Benefit multiplier
Retirement eligibility
Disability benefits
Death benefits
Definition of pension pay
Cost-of-living adjustments to retirees
Buck Consultants, Inc.
Mr. Harry M. Kilgore
November 5, 2002
Page 2
LETTER AGRFY~IENT
PENSION BENEFITS gTUDY
We would report results separately for general employees and police officers. Our survey results
will be a useful benchmark for City of Aventura pension benefits.
· Evaluation of three pension benefit options
O)
Maintain current 401(a) plato We understand the City currently contributes 12%
of pay to this plan. There are no member contributions.
(2)
Join the Florida Retirement System (FRS). We would analyze the process for
joining FRS and estimate the cost including recognition of prior service, and
future service only. We would provide broad review of funded status of FRS and
actual State contributions compared to actuarially determined contributions in
recent years.
(3)
Adopt local ordinance plan. We would review design, cost and administrative
issues. We would analyze setting up separate police and general employees plans,
or one combined plan. The proposed plan benefits would draw from the survey
information collected. Our review would include an estimate of Chapter 185 tax
premiums to offset some of the cost of the plan. We would also estimate required
member and City contributions to fund the plan.
In our evaluation of the three pension benefit options, we would outline the pros and cons of
each alternative. We would also compare the level of benefits provided under each option and
the cost to employees and the City.
Proposed Timing and Fees
We anticipate it will take approximately six to eight weeks to prepare the survey information and
make recommendations on the initial benefit design for a local law plan. After we review this
information with you and agree on the possible local plan design, we expect it will take about
four to six weeks to evaluate the pension benefit options and prepare a draft report of our
findings.
Mr. Harry M. Kilgore
November 5, 2002
Page 3
LETTER AGREtB/iENT
PENSION BENEFITS STUDY
The estimated fees for us to prepare this study are in the following ranges:
Survey of pension information for four entities, separately for
police and general employees
$ 8,000-$12,000
Evaluation of three pension benefit options
Maintain current 401(a) plan
Join the FRS
Adopt local law plan
$ 4,000-$ 5,000
$ 7,000-$ 9,000
$ 5,000-$ 7,000
Total estimated fees
$24,000-$33,000
We are providing a range for our fees because there are certain aspects of the study that are
difficult to estimate. For example, the cost of the survey will vary depending on the cooperation
- or lack of cooperation - from other entities in gathering the data. Another illustration where the
work required is uncertain is with respect to estimating the Chapter 185 tax premiums. If
situations arise which require work beyond the scope and fees outlined in this letter, we will
discuss them with you before we proceed with the work.
Our fees include the evaluation of the cost of one local law plan benefit design. We can prepare
modifications of the original plan design at a cost of $2,500 to $4,500 per scenario.
Please do not hesitate to contact ns to discuss our proposal after you have had an opportunity to
rev~:w it.
Sincerely,
Principal, Consulting Actuary
JIF:sjh
ACCRPTIf.~
CITY OF AVENTURA