2021 City of Titusville Police Officers' and Firefighters' Pension Plan - Actuarial Valuations

CITY OF TITUSVILLE POLICE OFFICERS' AND FIREFIGHTERS' PENSION PLAN

ACTUARIAL VALUATION

AS OF OCTOBER 1, 2021

CONTRIBUTIONS APPLICABLE TO THE PLAN/FISCAL YEAR ENDING SEPTEMBER 30, 2023

GASB 67/68 DISCLOSURE INFORMATION AS OF SEPTEMBER 30, 2021

 

Foster & Foster Actuaries and Consultants Logo


 

Foster & Foster Actuaries and Consultants Logo

 


February 14, 2022

Board of Trustees City of Titusville

Firefighters and Police Officers’ Pension Board

 

Re:       City of Titusville Police Officers' and Firefighters' Pension Plan Dear Board:

We are pleased to present to the Board this report of the annual actuarial valuation of the City of Titusville Police Officers' and Firefighters' Pension Plan. Included are the related results for GASB Statements No. 67 and No. 68. The funding valuation was performed to determine whether the assets and contributions are sufficient to provide the prescribed benefits and to develop the appropriate funding requirements for the applicable plan year. The calculation of the liability for GASB results was performed for the purpose of satisfying the requirements of GASB Statements No. 67 and No. 68. Use of the results for other purposes may not be applicable and may produce significantly different results.

 

The valuations have been conducted in accordance with generally accepted actuarial principles and practices, including the applicable Actuarial Standards of Practice as issued by the Actuarial Standards Board, and reflect laws and regulations issued to date pursuant to the provisions of Chapters 112, 175, and 185, Florida Statutes, as well as applicable federal laws and regulations. In our opinion, the assumptions used in the valuations, as adopted by the Board of Trustees, represent reasonable expectations of anticipated plan experience.

 

The funding percentages and unfunded accrued liability as measured based on the actuarial value of assets will differ from similar measures based on the market value of assets. These measures, as provided, are appropriate for determining the adequacy of future contributions, but may not be appropriate for the purpose of settling a portion or all of its liabilities. Future actuarial measurements may differ significantly from the current measurements presented in this report for a variety of reasons including: changes in applicable laws, changes in plan provisions, changes in assumptions, or plan experience differing from expectations. Due to the limited scope of the valuations, we did not perform an analysis of the potential range of such future measurements.

 


 

13420 Parker Commons Blvd., Suite 104 Fort Myers, FL 33912 · (239) 433-5500 · Fax (239) 481-0634 · www.foster-foster.com


 

In conducting the valuations, we have relied on personnel, plan design, and asset information supplied by the City of Titusville, financial reports prepared by the custodian bank, and the actuarial assumptions and methods described in the Actuarial Assumptions section of this report. While we cannot verify the accuracy of all this information, the supplied information was reviewed for consistency and reasonableness. As a result of this review, we have no reason to doubt the substantial accuracy of the information and believe that it has produced appropriate results. This information, along with any adjustments or modifications, is summarized in various sections of this report.

 

Additionally, we used third-party software to model (calculate) the underlying liabilities and costs. These results are reviewed in the aggregate and for individual sample lives. The output from the software is either used directly or input into internally developed models that apply the funding and accounting rules to generate the results. All internally developed models are reviewed as part of the valuation process. As a result of this review, we believe that the models have produced reasonable results. We do not believe there are any material inconsistencies among assumptions or unreasonable output produced due to the aggregation of assumptions.

 

The total pension liability, net pension liability, and certain sensitivity information shown in this report are based on an actuarial valuation performed as of October 1, 2020. The total pension liability was rolled-forward from the valuation date to the plan’s fiscal year ending September 30, 2021 using generally accepted actuarial principles. It is our opinion that the assumptions used for this purpose are internally consistent, reasonable, and comply with the requirements under GASB No. 67 and No. 68.

 

The undersigned are familiar with the immediate and long-term aspects of pension valuations, and meet the Qualification Standards of the American Academy of Actuaries necessary to render the actuarial opinions contained herein. All of the sections of this report are considered an integral part of the actuarial opinions.

 

To our knowledge, no associate of Foster & Foster, Inc. working on valuations of the program has any direct financial interest or indirect material interest in the City of Titusville, nor does anyone at Foster & Foster, Inc. act as a member of the Board of Trustees of the Police Officers' and Firefighters' Pension Plan. Thus, there is no relationship existing that might affect our capacity to prepare and certify this actuarial report.



 

If there are any questions, concerns, or comments about any of the items contained in this report, please contact us at 239-433-5500.

 

Respectfully submitted, Foster & Foster, Inc.

 

 

By:                             /S/                                   Douglas H. Lozen, EA, MAAA Enrolled Actuary #20-7778

 

 

 

 

By:                           /S/                                     Tyler A. Koftan, EA, MAAA

Enrolled Actuary #20-8685

 

 

DHL/lke Enclosures


 


 TABLE OF CONTENTS

  1.  Introduction

    1. Summary of Report – Pg. 6

    2. Changes Since Prior Valuations – Pg. 8

    3. Comparative Summary of Principal Valuation Results – Pg. 9

  2. Valuation Information

    1. Reconciliation of Unfunded Actuarial Accrued Liabilities – Pg. 15

    2. Detailed Actuarial (Gain)/Loss Analysis – Pg. 16

    3. History of Funding Progress – Pg. 17

    4. Actuarial Assumptions and Methods – Pg. 18

    5. Glossary – Pg. 21

    6. Discussion of Risk – Pg. 23

    7. Partial History of Premium Tax Refunds – Pg. 26

    8. Special Actuarial Account Activity – Pg. 27

    9. Special Actuarial Account – Pg. 28

  3. Trust Fund – Pg. 29

  4. Member Statistics

    1. Statistical Data – Pg. 37

    2. Age and Service Distribution – Pg. 38

    3. Valuation Participant Reconciliation – Pg. 39

  5. Summary of Current Plan – Pg. 40

  6. Governmental Accounting Standards Board Statements No. 67 and No. 68 Disclosure Information – Pg. 44 
     


 SUMMARY OF REPORT

The regular annual actuarial valuation of the City of Titusville Police Officers' and Firefighters' Pension Plan, performed as of October 1, 2021, has been completed and the results are presented in this Report. The contribution amounts set forth herein are applicable to the plan/fiscal year ending September 30, 2023.

 

The contribution requirements, compared with those set forth in the October 1, 2020 actuarial valuation report, are as follows:

 



Valuation Date

10/1/2021

10/1/2020

Applicable to Fiscal Year Ending

9/30/2023

9/30/2022

Minimum Required Contribution

$1,802,707

$1,755,945

Member Contributions (Est.)

561,211

539,608

City And State Required Contribution

1,241,496

1,216,337

State Contribution (Est.) (Note 1)

396,025

396,025

City Required Contribution (Note 2)

$845,471

$820,312

 

  

Note 1: Represents 50% of the amount received in calendar 2021. Pursuant to Ordinance 6-2017, the annual Chapter 175 and 185 Premium Tax Monies will be equally shared between the Membership Share Plan and City funding credit once the funded ratio (actuarial value of assets divided by the actuarial accrued liability) reaches or exceeds 90% as of the most recent actuarial valuation; this sharing will occur in the year following attainment of the 90% ratio. As of the October 1, 2021 valuation date, the funded ratio is 93.4%.

 

Note 2: Please note that the City has access to a prepaid contribution of $33,770.99 that is available to offset a portion of the above stated requirements for the fiscal year ending September 30, 2022.


 

 City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 6 


As you can see, the Minimum Required Contribution shows an increase when compared to the results determined in the October 1, 2020 actuarial valuation report. The increase is attributable to a reduction in the investment return assumption. The increase was offset in part by net favorable actuarial experience described in the next paragraph.

 

Plan experience was favorable overall on the basis of the plan's actuarial assumptions. Sources of actuarial gain included an investment return of 10.53% (Actuarial Asset Basis) which exceeded the 7.50% assumption and inactive mortality experience. There were no significant sources of actuarial loss.


 City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 7 


 CHANGES SINCE PRIOR VALUATION

Plan Changes

Since the prior valuation, the plan was amended by Ordinance No. 17-2021 to provide for the following changes. These changes had no impact on the plan’s funding requirements as set forth in the Letter of No Impact dated August 10, 2021.

 

  1. Changes to the definition of Salary for Firefighters, expanding to include additional pensionable items.
  2. Establishment of an allocation method for Share Plan amounts, for Firefighters employed on May 11, 2021.

 

Actuarial Assumption/Method Changes

Since the prior valuation, the Board approved a reduction in the investment return assumption from 7.50% to 7.25%, net of investment-related expenses.

 

There have been no method changes since the prior valuation.


City of Titusville General Employees' Pension Plan                                            FOSTER & FOSTER Pg. 8 


COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS

 

 A. Particpant Data

ItemNew Assumptions
10/1/2021
Old Assumptions
10/1/2021
10/1/2020
Actives141141139
Service Retirees103103101
DROP Retirees222
Beneficiaries212122
Disability Retirees121211
Terminated Vested535349
Total332332324
Total Annual Payroll$7,964,049$7,964,049$7,646,794
Payroll Under Assumed Retirement Age7,964,0497,964,0497,646,794


Annual Rate of Payments to:New Assumptions
10/1/2021
Old Assumptions
10/1/2021
10/1/2020
Service Retirees3,852,9863,852,9863,742,151
DROP Retirees133,914133,914133,914
Beneficiaries499,282499,282505,560
Disability Retirees299,082299,082259,181
Terminated Vested462,307462,307496,274


 B. Assets

ItemNew Assumptions
10/1/2021
Old Assumptions
10/1/2021
10/1/2020
Actuarial Value (AVA) (Note 1)71,027,20671,027,20666,500,222
Market Value (MVA) (Note 1)77,754,59577,754,59564,798,226


 C. Liabilities

Present Value of BenefitsNew Assumptions
10/1/2021
Old Assumptions
10/1/2021
10/1/2020
Actives:NO DATANO DATANO DATA
Retirement Benefits
19,385,54318,469,35117,566,180
Disability Benefits
1,395,3921,337,9131,276,243
Death Benefits
436,570418,006401,799
Vested Benefits
2,478,8452,321,2752,211,532
Refund of Contributions
395,185392,521380,061
Service Retirees43,896,42942,928,65242,667,851
DROP Retirees (Note 1)1,863,5221,824,3441,699,627
Beneficiaries5,298,0305,190,3105,250,912
Disability Retirees3,725,6573,632,8633,128,024
Terminated Vested3,778,6553,655,4313,692,935
Share Plan Balances (Note 1)976,303976,303390,554


TotalNew Assumptions
10/1/2021
Old Assumptions
10/1/2021
10/1/2020
Total Amount:83,630,13181,146,93978,665,718


Note 1: The asset values and liabilities include accumulated DROP Plan Balances as of 9/30/2021 and 9/30/2020.

Note 2: Contributions developed as of 10/1/2021 displayed above have been adjusted to account for assumed salary increase and interest components.


City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 9


COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS

 

C. Liabilities (Continued)

ItemNew Assumptions
10/1/2021
Old Assumptions
10/1/2021
10/1/2020
Present Value of Future Salaries64,487,96963,569,72960,761,859
Present Value of Future Member Contributions4,191,7184,132,0323,949,521
Normal Cost (Retirement)
641,483611,623595,770
Normal Cost (Disability)
97,33693,83693,147
Normal Cost (Death)
39,46238,13937,409
Normal Cost (Vesting)
158,180147,473154,907
Normal Cost (Refunds)
73,66073,45867,709
Total Normal Cost1,020,121964,529948,942
Present Value of Future Normal Costs7,597,8377,065,5376,863,988
Accrued Liability (Retirement)
14,392,36313,852,88513,081,908
Accrued Liability (Disability)
635,339615,977566,993
Accrued Liability (Death)
128,707124,768116,334
Accrued Liability (Vesting)
1,255,5071,198,0651,128,148
Accrued Liability (Refunds)
81,78281,83478,444
Accrued Liability (Inactives)(Note 1)
58,562,29357,231,60056,439,349
Share Plan Balances (Note 1)
976,303976,303390,554
Total Actuarial Accrued Liability (EAN AL)76,032,29474,081,43271,801,730
Unfunded Actuarial Accrued Liability (UAAL)5,005,0883,054,2265,301,508
Funded Ratio (AVA / EAN AL)93.4%95.9%92.6%


Note 1: The asset values and liabilities include accumulated DROP Plan Balances as of 9/30/2021 and 9/30/2020.

Note 2: Contributions developed as of 10/1/2021 displayed above have been adjusted to account for assumed salary increase and interest components.


City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 10


COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS

D. Actuarial Present Value of Accrued Benefits

ItemNew Assumptions
10/1/2021
Old Assumptions
10/1/2021
10/1/2020
Vested Accrued BenefitsNO DATANO DATANO DATA
Inactives + Share Plan Balances (Note 1)
59,538,59658,207,90356,829,903
Actives
7,138,5516,798,9475,309,558
Member Contributions
2,746,8052,746,8053,888,798
Total
69,423,95267,753,65566,028,259
Non-vested Accrued Benefits2,534,5342,399,3082,350,208
Total Present Value Accrued Benefits (PVAB)71,958,48670,152,96368,378,467
Funded Ratio (MVA / PVAB)108.1%110.8%94.8%
Increase (Decrease) in Present Value of Accrued Benefits Attributable to:NO DATANO DATANO DATA
Plan Amendments
00NO DATA
Assumption Changes
1,805,5230NO DATA
Plan Experience
01,523,428NO DATA
Benefits Paid
0(4,701,028)NO DATA
Interest
04,952,096NO DATA
Other
00NO DATA
Total
1,805,5231,774,496NO DATA


Note 1: The asset values and liabilities include accumulated DROP Plan Balances as of 9/30/2021 and 9/30/2020.

Note 2: Contributions developed as of 10/1/2021 displayed above have been adjusted to account for assumed salary increase and interest components.

City of Titusville General Employees' Pension Plan                                            FOSTER & FOSTER Pg. 11


COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS

E. Pension Cost

ItemNew Assumption
10/1/2021
Old Assumptions
10/1/2021
10/1/2020
Valuation Date Applicable to Fiscal Year Ending:9/30/20239/30/20239/30/2022
Normal Cost (Note 2)$1,105,938$1,046,931$1,030,209
Administrative Expenses (Note 2)110,920111,054119,199
Payment Required to Amortize Unfunded Actuarial Accrued Liability over 15 years (as of 10/1/2021) (Note 2)


585,849



370,799



606,537
Maximum Required Contribution1,802,7071,528,7841,755,945
Expected Member Contributions (Note 2)561,211561,888539,608
Expected City Contribution1,241,496966,8961,216,337


 F. Past Contributions

Plan Years Ending9/30/2021
City and State Requirement1,545,009
Actual Contributions Made - City1,148,984
Actual Contributions Made - State396,025
Actual Contributions Made - Total1,545,009


 G. Net Actuarial (Gain)/Loss

Net Actuarial (Gain)/Loss(1,652,889)


Note 1: The asset values and liabilities include accumulated DROP and Share Plan Balances as of 9/30/2021 and 9/30/2020.

Note 2: Contributions developed as of 10/1/2021 displayed above have been adjusted to account for assumed salary increase and interest components.

City of Titusville Police Officers' and Firefighters' Pension Plan                                            FOSTER & FOSTER Pg. 12


COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS

H. Schedule Illustrating the Amortization of the Total Unfunded Actuarial Liability as of:

YearProjected Unfunded Actuarial Accrued Liability
20215,005,088
20224,788,390
20234,555,981
20263,752,681
20302,382,345
20331,071,177
20360


 I.(i) 5 Year Comparison of Actual and Assumed Salary Increases

Year EndedActualAssumed
9/30/20215.00%4.38%
9/30/20206.43%4.36%
9/30/20194.08%4.03%
9/30/20184.63%6.00%
9/30/20173.44%6.00%


I.(ii) 5 Year Comparison of Investment Return on Market Value and Actuarial Value

Year EndedMarket ValueActuarial ValueAssumed
9/30/202154.12%10.53%7.50%
9/30/20206.51%8.25%7.75%
9/30/20193.06%9.53%7.75%
9/30/20189.55%8.08%8.00%
9/30/201714.17%8.49%8.00%


I.(iii) Average Annual Payroll Growth

  1. Payroll as of 10/1/2021 = $7,964,049 (Payroll as of 10/1/2011 = $6,618,868)
  2. Total Increase = 20.32%
  3. Number of Years = 10.00
  4. Average Annual Rate = 1.87%


City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 13


STATEMENT BY ENROLLED ACTUARY

This actuarial valuation was 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, the techniques and assumptions used are reasonable and meet the requirements and intent of Part VII, Chapter 112, Florida Statutes. There is no benefit or expense to be provided by the plan and/or paid from the plan's assets for which liabilities or current costs have not been established or otherwise taken into account in the valuation. All known events or trends which may require a material increase in plan costs or required contribution rates have been taken into account in the valuation.

 

 

 

              /S/                   

Douglas H. Lozen, EA, MAAA Enrolled Actuary #20-7778


Please let us know when the report is approved by the Board and unless otherwise directed we will provide a copy of the report to the following office to comply with Chapter 112 Florida Statutes:

 

 

 

Mr. Keith Brinkman Bureau of Local Retirement Systems

Post Office Box 9000

Tallahassee, FL 32315-9000


City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 14


RECONCILIATION OF UNFUNDED ACTUARIAL ACCRUED LIABILITIES

  1. Unfunded Actuarial Accrued Liability as of October 1, 2020 = $5,301,508
  2. Sponsor Normal Cost developed as of October 1, 2020 = 451,9006
  3. Expected administrative expenses for the year ended September 30, 2021 = 109,796
  4. Expected interest on (1), (2) and (3) = 435,623
  5. Sponsor contributions to the System during the year ended September 30, 2021 = 1,545,009
  6. Expected interest on (5) = 46,703
  7. Expected Unfunded Actuarial Accrued Liability as of September 30, 2021 (1)+(2)+(3)+(4)-(5)-(6) = 4,707,115
  8. Change to UAAL due to Assumption Change = 1,950,862
  9. Change to UAAL due to Actuarial (Gain)/Loss = (1,652,8899)
  10. Unfunded Actuarial Accrued Liability as of October 1, 2021 = 5,005,088
Type of BaseDate EstablishedYears Remaining10/1/2021
Amount
Amortization
Amount
Consolidation Base10/1/2020144,707,115509,401
Actuarial Gain10/1/202115(1,652,889)(171,892)
Assumption Change10/1/2021151,950,862202,880
TOTALNO DATANO DATA5,005,088540,389

 


City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 15


DETAILED ACTUARIAL (GAIN)/LOSS ANALYSIS

(1) Unfunded Actuarial Accrued Liability (UAAL) as of October 1, 2020 = $5,301,508

(2) Expected UAAL as of October 1, 2021 = 4,707,115

(3) Summary of Actuarial (Gain)/Loss, by component:

ComponentAmount
Investment Return (Actuarial Asset Basis)(1,979,488)
Salary Increases109,624
Active Decrements219,007
Inactive Mortality(59,299)
Other57,267
Increase in UAAL due to (Gain)/Loss(1,652,889)
Assumption Changes1,950,862


(4) Actual UAAL as of October 1, 2021 = $5,005,088


 City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 16


HISTORY OF FUNDING PROGRESS


[Bar graph depicting the changes in funded ratios based on Actuarial Value of Assets divided by the EAN Actuarial Accrued Liability, with the x-axis representing the years 2012 through 2021, and the y-axis representing the percentages 0.00% through 100.00%. 2012 = approximately 69%; 2013 = approximately 73%; 2014 = approximately 80%; 2015 = approximately 85%; 2016 = approximately 86%; 2017 = approximately 88%; 2018 = approximately 89%; 2019 = approximately 91%; 2020 = approximately 92%; 2021 = approximately 93%.]


City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 17
 


ACTUARIAL ASSUMPTIONS AND METHODS

Mortality Rate

Healthy Active Lives:

Female: PubS.H-2010 (Below Median) for Employees, set forward one year.

Male: PubS.H-2010 (Below Median) for Employees, set forward one year.


Healthy Retiree Lives:

Female: PubS.H-2010 for Healthy Retirees, set forward one year.

Male: PubS.H-2010 (Below Median) for Healthy Retirees, set forward one year.


Beneficiary Lives:

Female: PubG.H-2010 (Above Median) for Healthy Retirees.

Male: PubG.H-2010 for Healthy Retirees, set back one year.


Disabled Lives:

80% PubG.H-2010 for Disabled Retirees / 20% PubS.H- 2010 for Disabled Retirees.

 

All rates are projected generationally with Mortality Improvement Scale MP-2018. We feel this assumption sufficiently accommodates future mortality improvements.

 

The previously described mortality assumption rates were mandated by Chapter 2015-157, Laws of Florida. This law mandates the use of the assumptions used in either of the two most recent valuations of the Florida Retirement System (FRS). The above rates are those outlined in Milliman’s July 1, 2021 FRS valuation report for special risk employees, with appropriate adjustments made based on plan demographics.

 

90% of active deaths are assumed to be service-incurred.


Interest Rate

7.25% (prior year 7.50%) per year compounded annually, net of investment related expenses. This is supported by the target asset allocation of the trust and the expected long-term return by asset class.


City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 18


ACTUARIAL ASSUMPTIONS AND METHODS

Salary Increases

See table later in this section. This assumption was adopted as the result of the August 20, 2018 experience study. Assumptions for final salary loads are as follows:

 

For Members Eligible for Retirement on June 1, 2013: 

Projected salary at retirement is increased 25% to account for non-regular compensation.

 

For Members not eligible for Normal Retirement on June 1, 2013 with at least 10 years of service as of that date: 

The projected frozen benefit as of June 1, 2013 includes a 25% load for the final year included in the averaging period.

 

For Members with less than 10 years of service (and not eligible for Normal Retirement) as of June 1, 2013: 

No final salary load is assumed.

 

Payroll Growth                                                                 

None.

 

Administrative Expenses                                                   

$102,313 annually, based on the average of actual expenses incurred in the prior two fiscal years.

 

Amortization Method                                                        

New UAAL amortization bases are amortized over 15 years.

 

Retirement (Normal and Early)                                          

See tables later in this section. This assumption was adopted as the result of the August 20, 2018 experience study.

 

Termination Rates                                                            

See table later in this section. This assumption was adopted as the result of the August 20, 2018 experience study.

 

Disability Rates                                                                

See table later in this section. This assumption was adopted as the result of the August 20, 2018 experience study. 90% of Disability retirements are assumed to be service-related.

 

Asset Smoothing Methodology                                          

The Actuarial Value of Assets is brought forward using the historical four-year geometric average of Market Value Returns (net-of-fees). Over time, this may result in an immaterial bias that is above or below the Market Value of Assets.


City of Titusville Police Officers' and Firefighters' Pension Plan                                             FOSTER & FOSTER Pg. 19


ACTUARIAL ASSUMPTIONS AND METHODS


Funding Method

Entry Age Normal Actuarial Cost Method. The following loads are applied for determination of the Sponsor funding requirement:

Interest – A half year, based on the current 7.25% assumption.

Salary – A full year, based on the current 4.62% assumption.


 
Assumption Tables 

Percentage Terminating During the Year

Service (Years)Rate
0 to 114.0%
2 to 311.0%
4 to 96.0%
10+4.0%


Percentage Becoming Disabled During the Year

AgeRate
200.09%
250.10%
300.12%
350.16%
400.21%
450.38%
500.72%
551.095%
601.361%


Salary Scale

Service (Years)Rate
07.00%
1 to 34.50%
4+4.00%


Percentage Retiring During the Year (Less than 25 Years of Service)

AgeRate
50 to 5415.0%
55 to 5850.0%
59+100%


Percentage Retiring During the Year (Greater than or Equal to 25 Years of Service)

Service (Years)Rate
25 to 2850.0%
29+100.0%

 


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GLOSSARY

Actuarial Value of Assets is the asset value used in the valuation to determine contribution requirements. It represents the plan’s Market Value of Assets (see below), with adjustments according to the plan’s Actuarial Asset Method. These adjustments produce a “smoothed” value that is likely to be less volatile from year to year than the Market Value of Assets.

 

Entry Age Normal Cost Method - Under this method, the normal cost is the sum of the individual normal costs for all active participants. For an active participant, the normal cost is the participant’s normal cost accrual rate, multiplied by the participant’s current compensation.

  1. The normal cost accrual rate equals:
    1. the present value of future benefits for the participant, determined as of the participant’s entry age, divided by
    2. the present value of the compensation expected to be paid to the participant for each year of the participant’s anticipated future service, determined as of the participant’s entry age.
  2. In calculating the present value of future compensation, the salary scale is applied both retrospectively and prospectively to estimate compensation in years prior to and subsequent to the valuation year based on the compensation used for the valuation.
  3. The accrued liability is the sum of the individual accrued liabilities for all participants and beneficiaries. A participant’s accrued liability equals the present value, at the participant’s attained age, of future benefits less the present value at the participant’s attained age of the individual normal costs payable in the future. A beneficiary’s accrued liability equals the present value, at the beneficiary’s attained age, of future benefits. The unfunded accrued liability equals the total accrued liability less the actuarial value of assets.
  4. Under this method, the entry age used for each active participant is the participant’s age at the time he or she would have commenced participation if the plan had always been in existence under current terms, or the age as of which he or she first earns service credits for purposes of benefit accrual under the current terms of the plan.

Market Value of Assets is the fair market value of plan assets as of the valuation date. This amount may be adjusted to produce an Actuarial Value of Assets for plan funding purposes.

 

Normal (Current Year's) Cost is the current year's cost for benefits yet to be funded. Under the Entry Age Normal cost method, it is determined for each participant as the present value of future benefits, determined as of the Member’s entry age, amortized as a level percentage of compensation over the anticipated number of years of participation, determined as of the entry age.

 

Present Value of Benefits is the single sum value on the valuation date of all future benefits to be paid to current plan participants.

 

Total Annual Payroll is the projected annual rate of pay for the fiscal year beginning on the valuation date of all covered Members.


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GLOSSARY

Total Required Contribution is equal to the Normal Cost plus an amount sufficient to amortize the Unfunded Accrued Liability over no more than 30 years. The required amount is adjusted for interest according to the timing of contributions during the year.

 

Unfunded Actuarial Accrued Liability (UAAL) is the difference between the actuarial accrued liability (described above) and the Actuarial Value of Assets. Under the Entry Age Normal Actuarial Cost Method, an actuarial gain or loss, based on actual versus expected UAAL, is determined in conjunction with each valuation of the plan.


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DISCUSSION OF RISK

ASOP No. 51, Assessment and Disclosure of Risk Associated with Measuring Pension Obligations and Determining Pension Plan Contributions, states that the actuary should identify risks that, in the actuary’s professional judgment, may reasonably be anticipated to significantly affect the plan’s future financial condition.

Throughout this report, actuarial results are determined using various actuarial assumptions. These results are based on the premise that all future plan experience will align with the plan’s actuarial assumptions; however, there is no guarantee that actual plan experience will align with the plan’s assumptions. It is possible that actual plan experience will differ from anticipated experience in an unfavorable manner that will negatively impact the plan’s funded position.

Below are examples of ways in which plan experience can deviate from assumptions and the potential impact of that deviation. Typically, this results in an actuarial gain or loss representing the current-year financial impact on the plan’s unfunded liability of the experience differing from assumptions; this gain or loss is amortized over a period of time determined by the plan’s amortization method. When assumptions are selected that adequately reflect plan experience, gains and losses typically offset one another in the long term, resulting in a relatively low impact on the plan’s contribution requirements associated with plan experience. When assumptions are too optimistic, losses can accumulate over time and the plan’s amortization payment could potentially grow to an unmanageable level.

  • Investment Return: When the rate of return on the Actuarial Value of Assets falls short of the assumption, this produces a loss representing assumed investment earnings that were not realized. Further, it is unlikely that the plan will experience a scenario that matches the assumed return in each year as capital markets can be volatile from year to year. Therefore, contribution amounts can vary in the future. 
  • Salary Increases: When a plan participant experiences a salary increase that was greater than assumed, this produces a loss representing the cost of an increase in anticipated plan benefits for the participant as compared to the previous year. The total gain or loss associated with salary increases for the plan is the sum of salary gains and losses for all active participants. 
  • Demographic Assumptions: Actuarial results take into account various potential events that could happen to a plan participant, such as retirement, termination, disability, and death. Each of these potential events is assigned a liability based on the likelihood of the event and the financial consequence of the event for the plan. Accordingly, actuarial liabilities reflect a blend of financial consequences associated with various possible outcomes (such as retirement at one of various possible ages). Once the outcome is known (e.g. the participant retires) the liability is adjusted to reflect the known outcome. This adjustment produces a gain or loss depending on whether the outcome was more or less favorable than other outcomes that could have occurred.


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DISCUSSION OF RISK

Impact of Plan Maturity on Risk

For newer pension plans, most of the participants and associated liabilities are related to active members who have not yet reached retirement age. As pension plans continue in operation and active members reach retirement ages, liabilities begin to shift from being primarily related to active members to being shared amongst active and retired members. Plan maturity is a measure of the extent to which this shift has occurred. It is important to understand that plan maturity can have an impact on risk tolerance and the overall risk characteristics of the plan. For example, closed plans with a large amount of retired liability do not have as long of a time horizon to recover from losses (such as losses on investments due to lower than expected investment returns) as plans where the majority of the liability is attributable to active members. For this reason, less tolerance for investment risk may be warranted for highly mature closed plans with a substantial inactive liability. Similarly, mature closed plans paying substantial retirement benefits resulting in a small positive or net negative cash flow can be more sensitive to near term investment volatility, particularly if the size of the fund is shrinking, which can result in less assets being available for investment in the market.

To assist with determining the maturity of the plan, we have provided some relevant metrics in the table following titled “Plan Maturity Measures and Other Risk Metrics”. Highlights of this information are discussed below:

  • The Support Ratio, determined as the ratio of active to inactive members, has decreased from 108.2% on October 1, 2011 to 84.9% on October 1, 2021, indicating that the plan has been maturing during the period. 
  • The Accrued Liability Ratio, determined as the ratio of the Inactive Accrued Liability, which is the liability associated with members who are no longer employed but are due a benefit from the plan, to the Total Accrued Liability, is 77.0%. With a plan of this maturity, losses due to lower than expected investment returns or demographic factors may result in larger increases in contribution requirements than would be needed for a less mature plan. Please note Chapter 112, Florida Statutes, requires that the plan sponsor contributes the minimum required contribution; thus, there is minimal solvency risk to the plan. 
  • The Funded Ratio, determined as the ratio of the Actuarial Value of Assets to the Total Accrued Liability, has increased from 64.6% on October 1, 2011 to 93.4% on October 1, 2021. 
  • The Net Cash Flow Ratio, determined as the ratio of the Net Cash Flow (contributions minus benefit payments and administrative expenses) to the Market Value of Assets, decreased from 1.7% on October 1, 2011 to -3.0% on October 1, 2021. The current Net Cash Flow Ratio of -3.0% indicates that contributions are not currently covering the plan's benefit payments and administrative expenses. 

It is important to note that the actuary has identified the risks in this section as the most significant risks based on the characteristics of the plan and the nature of the project, however, it is not an exhaustive list of potential risks that could be considered. Additional advanced modeling, as well as the identification of additional risks, can be provided at the request of the audience addressed on page 2 of this report.


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PLAN MATURITY MEASURES AND OTHER RISK METRICS

Item10/1/201110/1/201610/1/202010/1/2021

Support Ratio

Total Actives
119130139141
Total Inactives (Note 1)
110157170166
Actives / Inactives (Note 1)
108.2%82.8%81.8%84.9%

Asset Volatility Ratio

Market Value of Assets (MVA)
34,189,66953,173,63364,798,22677,754,595
Total Annual Payroll
6,618,8686,748,2037,646,7947,964,049
MVA / Total Annual Payroll
516.5%788.0%847.4%976.3%

Accrued Liability (AL) Ratio

Inactive Accrued Liability
41,064,46149,419,56356,439,34958,562,293
Total Accrued Liability (EAN)
57,432,46462,646,92771,801,73076,032,294
Inactive AL / Total AL
71.5%78.9%78.6%77.0%

Funded Ratio

Actuarial Value of Assets (AVA)
37,092,63853,979,48966,500,22271,027,206
Total Accrued Liability (EAN)
57,432,46462,646,92771,801,73076,032,294
AVA / Total Accrued Liability (EAN)
64.6%86.2%92.6%93.4%

Net Cash Flow Ratio

Net Cash Flow (Note 2)
571,195(1,012,599)(1,674,613)(2,352,226)
Market Value of Assets (MVA)
34,189,66953,173,63364,798,22677,754,595
Ratio
1.7%-1.9%-2.6%-3.0%

 

Note 1: Excludes terminated participants awaiting a refund of member contributions.

Note 2: Determined as total contributions minus benefit payments and administrative expenses.

 
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PARTIAL HISTORY OF PREMIUM TAX REFUNDS

Received During Fiscal YearAmountIncrease from Previous Year
1999292,120.75NO DATA
2000284,295.61-2.7%
2001303,087.866.6%
2002341,514.0612.7%
2003373,360.339.3%
2004428,469.9214.8%
2005449,292.464.9%
2006464,257.043.3%
2007512,547.5510.4%
2008664,120.7629.6%
2009649,120.76-2.2%
2010578,165.27-11.0%
2011549,312.77-5.0%
2012598,656.969.0%
2013671,213.4712.1%
2014724,287.497.9%
2015670,200.87-7.5%
2016731,349.819.1%
2017681,740.60-6.8%
2018724,199.936.2%
2019753,963.144.1%
2020781,108.363.6%
2021792,050.871.4%





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SPECIAL ACTUARIAL ACCOUNT ACTIVITY

10/1/2020 to 10/1/2021

Growth Assuming 7.50% Return

(1) 10/1/2020 Beginning Balance = 68,236,535

Contributions2,446,623
Investment Earnings5,029,532
Non-Investment Expenses97,821
Investment Expenses263,992
Distributions4,701,028


(2) 09/30/2021 Ending Balance = 70,649,849


(3) 09/30/2021 Actuarial Assets = 71,027,206


(4) Excess Earnings (3) - (2) = 377,357


(5) 09/30/2021 Actuarial Gain (Loss) = 1,652,889

Share Account Allocation: Lesser of: [(4) or (5)] x 70% = 264,150


Share Account Activity

10/1/2020 Account Balance = (82,037,034)

Interest at 7.50% = (6,152,778)

10/1/2021 Addition = 264,150

10/1/2021 Benefits "Purchase" = 0

10/1/2021 Account Balance = (87,925,662)

10/1/2021 Adjusted Actuarial Assets

(6) Actuarial Assets (3), above = 71,027,206

(7) 10/1/2021 Account Balance = (87,925,662)

Adjusted Actuarial Assets, Lesser of: (6) or [(6) - (7)] = 71,027,206


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SPECIAL ACTUARIAL ACCOUNT

History of Benefit "Purchases" and Actuarial Gains and Losses

 

Plan Year EndedBenefit "Purchases"Notes
Net Actuarial Gain (Loss)
9/30/1991106,565(1)407,179
9/30/1992
481,200
9/30/1993
(221,686)
9/30/1994331,857(2)167,994
9/30/1995251,762 (3)(145,889) 
9/30/1996509,800(4)89,658 
9/30/1997
678,279
9/30/1998428,988(5)541,465 
9/30/1999716,239(6)967,544
9/30/2000416,578 (7)502,392
9/30/2001
(618,344)
9/30/2002
(2,039,277)
9/30/2003
(1,740,552)
9/30/2004
(1,869,013)
9/30/2005
(1,108,361)
9/30/2006
(2,471,326)
9/30/2007
(18,699)
9/30/2008
(1,581,383)
9/30/2009
(2,884,794)
9/30/2010
(2,634,658)
9/30/2011
(590,967)
9/30/2012
913,451
9/30/2013
1,427,266
9/30/2014
2,668,236
9/30/2015(6,509)(8)990,972
9/30/2016
203,373
9/30/2017
407,936 
9/30/2018
(108,319)
9/30/2019(17,340)(9)270,508 
9/30/2020
(296,595)
9/30/2021
1,652,889
TOTAL2,737,940

(5,959,521)


Notes:

  1. AIS dated 01/21/94
  2. AIS dated 07/02/96
  3. AIS dated 02/28/97
  4. AIS dated 01/22/98
  5. AIS dated 08/26/99
  6. AIS dated 05/04/00
  7. AIS dated 02/23/01
  8. AIS dated 02/10/17
  9. AIS dated 01/07/20

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STATEMENT OF FIDUCIARY NET POSITION

SEPTEMBER 30, 2021

ASSETS

Cash and Cash Equivalents:COST VALUEMARKET VALUE
Short Term Investments1,643,088.001,643,088.00
Cash1.871.87
Total Cash and Equivalents1,643,089.871,643,089.87
Receivables:COST VALUEMARKET VALUE
From Broker for Investments Sold37,820.8137,820.81
Investment Income116,873.28116,873.28
Total Receivables154,694.09154,694.09
Investments:COST VALUEMARKET VALUE
U.S. Bonds and Bills164,995.82164.992.45
Fixed Income22,302,723.6222,349,831.22
Equities30,394,796.4638,061,531.76
Pooled/Common/Commingled Funds:
Equity

5,848,101.51

8,821,390.04
Pooled/Common/Commingled Funds:
Real Estate

5,146,176.13

6,806,849.65
Total Investments63,856,793.5476,204,595.12
TOTAL ASSETS65,654,577.5078,002,379.08

LIABILITIES

Payables:COST VALUEMARKET VALUE
Refunds of Member Contributions8,904.788,904.78
Benefit Payments4,830.024,830.02
Administrative Expenses1,796.651,796.65
To Broker for Investments Purchased198,055.66198,055.66
Prepaid Member Contribution426.14426.14
Prepaid City Contribution33,770.9933,770.99
Total Liabilities247,784.24247,784.24
NET POSITION RESTRICTED FOR
PENSIONS
65,406,793.2677,754,594.84


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STATEMENT OF CHANGES IN FIDUCIARY NET POSITION

FOR THE YEAR ENDED SEPTEMBER 30, 2021

Market Value Basis

Additions

Contributions:Amount
Member505,588.53
City1,148,983.57
State792,050.87
Total Contribution2,446,622.97
Investment Income:Amount
Net Realized Gain (Loss)8,145,298.60
Unrealized Gain (Loss)4,741,485.26
Net Increase in Fair Market Value of Investments12,886,783.86
Interest & Dividends2,685,802.31
Less Investment Expense (Note 1)(263,991.74)
Net Investment Income15,308,594.43

Total Additions = 17,755,217.40


Deductions

Distributions to Members:Amount
Benefit Payments4,578,985.61
Lump Sum DROP Distributions0.00
Lump Sum Share Distributions0.00
Lump Sum PLOP Distributions74,608.52
Refunds of Member Contributions47,433.45
Total Distributions4,701,027.58
Administrative Expense97,821.24

Total Deductions = 4,798,848.82


Net Increase in Net Position = 12,956,368.58


NET POSITION RESTRICTED FOR PENSIONSAmount
Beginning of the Year64,798,226.26
End of the Year77,754,594.84


Note 1: Investment related expenses include investment advisory, custodial and performance monitoring fees.


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ACTUARIAL ASSET VALUATION

SEPTEMBER 30, 2021

Actuarial Assets for funding purposes are developed by increasing the Actuarial Assets used in the most recent actuarial valuation of the Fund by the average annual market value rate of return (net of investment related expenses) for the past four years. Actuarial Assets shall not be less than 80% nor greater than 120% of Market Value of Assets.

Details of the derivation are set forth as follows:

Plan Year EndRate of Return (Note 1)
09/30/20189.55%
09/30/20193.06%
09/30/20206.51%
09/30/202124.12%

Annualized Rate of Return for prior four (4) years: = 10.53%


  • (A) 10/1/2020 Actuarial Assets = $66,500,222.06
  • (I) Net Investment Income:
    • 1. Interest Dividends = 2,685,802.31
    • 2. Realized Gain (Loss) = 8,145,298.60
    • 3. Unrealized Gain (Loss) = 4,741,485.26
    • 4. Change on Actuarial Value = (8,429,384.20)
    • 5. Investment Related Expenses = (263,991.74)
    • Total = 6,879,210.23
  • (B) 10/1/2021 Actuarial Assets = $71,027,206.44

Actuarial Rate of Return = 2I/(A+B-I): 10.53%

10/01/2021 Limited Actuarial Assets: $71,027,206.44

10/01/2021 Market Value of Assets: $77,754,594.84

Actuarial Gain (Loss) due to Investment Return (Actuarial Asset Basis) = $1,979,487.84

Note 1: Market Value Basis, net of investment related expenses.


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 CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS

SEPTEMBER 30, 2021

Actuarial Asset Basis

Contributions:Amount
Member505,588.53
City1,148,983.57
State792,050.87
Total Contribution2,446,622.97
Earnings from Investments:Amount
Interest & Dividends2,685,802.31
Net Realized Gain (Loss)8,145,298.60
Unrealized Gain (Loss)4,741,485.26
Change in Actuarial Value(8,429,384.20)
Total Earnings and Investment Gains7,143,201.97


EXPENDITURES

Distributions to Members:Amount
Benefit Payments4,578,985.61
Lump Sum DROP Distributions0.00
Lump Sum Share Distributions0.00
Lump Sum PLOP Distributions74,608.52
Refunds of Member Contributions47,433.45
Total Distributions4,701,027.58
Expenses:Amount
Investment related (Note 1)263,991.74
Administrative97,821.24
Total Expenses361,812.98

Change in Net Assets for the Year = 4,526,984.38

Net Assets Beginning of the Year = 66,500,222.06

Net Assets End of the Year (Note 2) = 71,027,206.44


Note 1: Investment related expenses include investment advisory, custodial and performance monitoring fees.

Note 2: Net Assets may be limited for actuarial consideration.


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DEFERRED RETIREMENT OPTION PLAN ACTIVITY

October 1, 2020 to September 30, 2021

DescriptionAmount

Beginning of the Year Balance

62,009.40

Plus Additions

133,913.40

Investment Return Earned

9,418.21

Less Distributions

0.00

End of the Year Balance

205,341.01


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SUPPLEMENTAL CHAPTER 175 and 185 SHARE PLAN ACTIVITY

October 1, 2020 through September 30,2021


9/30/2020 Balance (est.) = 390,554.18

Prior Year Adjustment = 0.00

Plus Additions = 396,025.44

Investment Return Earned (est.) = 189,723.00

Administrative Fees = 0.00

Less Distribution = 0.00

9/30/2021 Balance (est.) = 976,302.62

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RECONCILIATION OF CITY'S SHIRTFALL /(PREPAID) CONTRIBUTION

FOR THE FISCAL YEAR ENDED (FYE) SEPTEMBER 30, 2021


  1. Required City and State Contributions = $1,545,009.00
  2. Less Allowable State Contribtion = (396,025.43)
  3. Required City Contribution for Fiscal 2021 = 1,148,983.57
  4. Less 2020 Prepaid Contribution = (13,962.26)
  5. Less Actual City Contribution = (1,168,792.30)
  6. Equals City's Shortfall (Prepaid) Contribution as of September 30, 2021 = ($33,770.99)

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HISTORY OF ASSET VALUES AND INVESTMENT RETURNS

 

 [A line graph depicting the History of Asset Values (Market Value vs. Actuarial Value), with the horizontal axis representing the years 2012 through 2021; and the vertical axis representing the value in $10million increments starting at 0.

The Actuarial Value of Assets (green line) values are: 2012 = approximately 40 million; 2013 = approximately 43 million; 2014 = approximately 46 million; 2015 - approximately 50 million; 2016 = approximately 54 million; 2017 = approximately 56 million; 2018 = approximately 59 million; 2019 = approximately 62 million; 2020 = approximately 67 million; and 2021 = approximately 70 million.

The Market Value of Assets (blue line) values are: 2012 = approximately 41 million; 2013 = approximately 48 million; 2014 = approximately 50 million; 2015 = approximately 49 million; 2016 = approximately 53 million; 2017 = approximately 59 million; 2018 = approximately 61 million; 2019 = approximately 61 million; 2020 = approximately 65 million; and 2021 = approximately 78 million.]


[A bar graph depicting the History of Investment Returns (Market Value vs. Actuarial Value), with horizontal axis representing the years 2012 through 2021; and the vertical axis representing the percentages in increments of 5%, starting at -5.00%.

The Return on Actuarial Value of Assets (green bar) values are: 2012 = approximately 6%; 2013 = approximately 11%; 2014 = approximately 12%; 2015 = approximately 11%; 2016 = approximately 8%; 2017 = approximately 8%; 2018 = approximately 7%; 2019 = 9%; 2020 = 7%; and 2021 = 11%.


The Return on Market Value of Assets (blue bar) values are: 2012 = approximately 20%; 2013 = approximately 14%; 2014 = approximately 12%; 2015 = approximately -4%; 2016 = approximately 13%; 2017 = approximately 13%; 2018 = approximately 9%; 2019 = approximately  4%; 2020 = approximately 6%; and 2021 = approximately  24%.  


The Assumed Returns (purple bar) values are: 2012 = approximately 7%; 2013 = approximately 7%; 2014 = approximately 7%; 2015 = approximately 7%; 2016 = approximately 7%; 2017 = approximately 7%; 2018 = approximately 7%; 2019 = 7%; 2020 = approximately 7%; and 2021 = approximately 7%. ]


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STATISTICAL DATA

Activities

Description10/1/201810/1/201910/1/202010/1/2021
Number136138139141
Average Current Age36.536.636.135.6
Average Age at Employment27.827.627.827.1
Average Past Service8.79.08.38.5
Average Annual Salary$53,262$54,492$55,013$56,483


Service Retirees

Description10/1/201810/1/201910/1/202010/1/2021
Number9399101103
Average Current Age64.264.665.165.6
Average Annual Benefit$44,281$43,406$37,051$37,408


DROP Retirees

Description10/1/201810/1/201910/1/202010/1/2021
Number0022
Average Current AgeNot ApplicableNot Applicable52.253.2
Average Annual BenefitNot ApplicableNot Applicable$66,957$66,957


Beneficiaries

Description10/1/201810/1/201910/1/202010/1/2021
Number21222221
Average Current Age67.767.268.267.8
Average Annual Benefit$22,297$22,948$22,980$23,775


Disability Retirees

Description10/1/201810/1/201910/1/202010/1/2021
Number991112
Average Current Age56.857.856.957.3
Average Annual Benefit$20,121$20,121$23,562$24,924


Terminated Vested

Description10/1/201810/1/201910/1/202010/1/2021
Number51454953
Average Current Age (Note 1)
45.2

45.0

45.4

47.8
Average Annual Benefit (Note 1)
$16,111

$14,027

$14,596

$16,511


Note 1: The Average Current Age and Average Annual Benefit exclude participants awaiting a refund of contributions.



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AGE AND SERVICE DISTRIBUTION

 

 PAST SERVICE

AGE012345 to 910 to 1415 to 1920 to 2425 to 2930+Total
15 - 19000000000000
20 - 246412000000013
25 - 297963150000031
30 - 3411232101000020
35 - 3922300145700033
40 - 441000043920019
45 - 490001016212013
50 - 540000001730011
55 - 59010000000001
60 - 64000000000000
65+000000000000
Total17171293341625620141

 


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VALUATION PARTICIPANT RECONCILIATION

 

  1. Active lives
    1. Number in prior valuation 10/1/2020 = 139
    2. Terminations
      1. Vested (partial or full) with deferred annuity = (1)
      2. Vested in refund of member contributions only = (8)
      3. Refund of member contributions or full lump sum distribution received = (4)
    3. Deaths
      1. Beneficiary receiving benefits = 0
      2. No future benefits payable = 0
    4. Disabled = 1
    5. Retired = (2)
    6. DROP = 0
    7. Continuing participants = 123
    8. New entrants = 187
    9. Total active life participants in valuation = 141
  2. Non-Active lives (including beneficiaries receiving benefits)
CategoryService Retirees, Vested Receiving BenefitsDROP BenefitsReceiving Death BenefitsReceiving Disability BenefitsVested (Deferred Annuity)Vested (Due Refund)Total
a. Number prior valuations101222113415185
Retired4000(2)02
DROP0000000
Vested (Deferred Annuity)0000101
Vested (Due Refund)0000088
Hired/Terminated in Same Year0000000
Death, With Survivor(1)020(1)00
Death, No Survivor(1)0(3)000(4)
Disabled0001001
Refund of Contributions00000(1)(1)
Rehires0000000
Expired Annuities0000000
Data Corrections0000(4)3(1)
b. Number current valuation103221122825191

 

Note 1: Members entitled to both a deferred annuity and a refund are included in both categories. 

 

 


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SUMMARY OF CURRENT PLAN

(Through Ordinance 17-2021)

 

Original Effective Date 

December 30, 1966.

 

Credited Service           

Years and fractional parts of years of service with the City as a Police Officer of Firefighter.

 

Salary   

Before June 1, 2013 (and for Members eligible for Normal Retirement as of that date):

Gross earnings including overtime pay, and tax exempt, tax sheltered or tax deferred items of income.

After June 1, 2013:

Police Officers: Base pay, special duty incentives paid, and educational incentive pay (not to exceed $6,750 per year), excluding overtime and all other forms of compensation.

Firefighters: Base pay, certification and certain types of incentive pay (not to exceed $6,750 per year). Excludes overtime and any other forms of compensation.

For purposes of determining the frozen accrued benefit as of June 1, 2013 Salary includes payment of accumulated leave that would have been included in salary if the Member retired prior to June 1, 2013, however the leave balance shall be reduced by leave used subsequent to June 1, 2013.

Average Final Compensation     

Before June 1, 2013 (and for Members eligible for Normal Retirement as of that date):

Average of Salary during the highest three (3) years out of the last ten (10) years.

After June 1, 2013:

Average of Salary during the highest five (5) years out of the last ten (10) years.

Normal Retirement

Benefit for Service Prior to June 1, 2013:

Date: First of the month coinciding with or following the earlier of age 55 and the completion of eight (8) years of Credited Service or the completion of 25 years of Credited Service regardless of age.


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SUMMARY OF CURRENT PLAN

(Through Ordinance 17-2021)

Normal Retirement (continued)

Benefit: 3.0% of Average Final Compensation (Before June 1, 2013) times Credited Service.

Form of Benefit: Ten Year Certain and Life Annuity (options available).

Benefit Accrued for Service After June 1, 2013: 

Date: Remains the same for those with at least ten (10) years of service as of this date.

For members with less than ten (10) years of service, is the earlier of age 55 and the completion of ten (10) years of Credited Service or age 52 with 25 years of Credited Service.

Benefit: 2.5% of Average Final Compensation (5-Year) times Credited Service.

Form of Benefit: Ten Year Certain and Life Annuity (options available).

Members eligible for retirement prior to June 1, 2013 will continue to follow the same structure as before these amendments were adopted.

Early Retirement

Eligibility: With at least 10 years of Credited Service, age 50.

Benefit: Same as for Normal Retirement but reduced 3% per year prior to age 55 to reflect early payment.

Vesting

Schedule:

Before June 1, 2013:

0% for first 7 years, 100% after 8 years.

After June 1, 2013:

100% for 10 years (All Members are 100% vested in their frozen accrued benefit as of June 1, 2013).

Benefit: 

  • Before June 1, 2013: Frozen vested accrued benefit as of June 1, 2013 paid beginning at age 55.
  • After June 1, 2013: Vested Accrued benefit based on Service earned after June 1, 2013.

Terminated Vested Members may elect a refund of contributions or a monthly annuity payable upon reaching age 55.

Non-vested Members receive a refund of contributions.


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SUMMARY OF CURRENT PLAN

(Through Ordinance 17-2021)

Disability

Eligibility:  Total and permanent (as determined by the Board). Members covered from date of hire (Service incurred) or after completion of 10 years of Credited Service (Non- Service incurred).

 

Benefit: Accrued Benefit (determined as for Normal Retirement). Benefit shall not be less than 50% of Average Final Compensation for service incurred disability.

 

Form of Benefit: Paid for life and ten years certain, or until recovery (as determined by the Board); optional forms of payment are available.

 

Maximum: Total of Plan and Workers Compensation benefits shall not exceed 100% of Average Monthly Wage.


Cost of Living Adjustment

Eligibility: Normal and Early Retirees (and Disability Retirees who otherwise meet the requirements for Normal or Early Retirement at the time of Disability Retirement) hired before June 1, 2013.

Benefit: 1.277% automatic lifetime COLA, beginning the first October 1 following one full year of retirement. For Members not eligible for Normal Retirement as of June 1, 2013 shall only apply to credited service earned prior to June 1, 2013.

Death Benefits

Service Incurred:

Coverage from date of employment; beneficiary receives greater of accrued benefit or 50% of Average Final Compensation for life, with a maximum payment period of 25 years for non-spouse beneficiaries only.

Non-Service Incurred:

Coverage after 8 years of service; same benefit as Service Incurred.

Contributions

Member:

6.5% of Salary.

State:

Tax on premiums for fire and casualty insurance issued to residents of the City as provided in Chapters 175 and 185, Florida Statutes.

City:

Remaining amount necessary to pay the Normal Cost and fund the accrued, past service liability over 30 years.



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SUMMARY OF CURRENT PLAN

(Through Ordinance 17-2021)

Board of Trustees

Police Chief, Fire Chief, Commander designated by Police Chief, Division Chief designated by Fire Chief, Two elected Members from each Department, one citizen selected by a majority of other Members and appointed by the City Council as a ministerial duty.

 

Deferred Retirement Option Plan

Eligibility

The original DROP is closed to any new participants after July 2, 2013. A subsequent program “DROP II” is available to participants effective December 10, 2019.

 

Participation

Not more than 60 months.

 

Rate of Return

The Account is credited with the actual net rate of investment return (total return net of investment management fees, brokerage commissions and transaction costs) minus 2% after each fiscal year end. The annual return is subject to a minimum of 0% and a maximum equal to the current valuation investment return assumption as adopted by the Board.

 

Form of Distribution

Cash lump sum (options available) payable at termination of employment.


Share Plan

Funded Status

Not currently funded. Once funded, the method of allocation will be established by a mutual agreement between the City and unions representing the Police Officers and Firefighters.


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GASB 67

STATEMENT OF FIDUCIARY NET POSITION

SEPTEMBER 30, 2021

ASSETS

Cash and Cash Equivalents:MARKET VALUE
Short Term Investments1,643,088
Cash2
Total Cash and Equivalents1,643,090
Receivables:MARKET VALUE
From Broker for Investments Sold37,821
Investment Income116,873
Total Receivable154,694
Investments:MARKET VALUE
U.S. Bonds and Bills164,993
Fixed Income22,349,831
Equities38,061,532
Pooled/Common/Commingled Funds - Equity8,821,390
Pooled/Common/Commingled Funds - Real Estate6,806,850
Total Investments76,204,596

TOTAL ASSETS = 78,002,380

LIABILITIES

Payables:MARKET VALUE
Refunds of Member Contributions8,905
Benefit Payments4,830
Administrative Expenses1,797
To Broker for Investments Purchased198,056
Total Liabilities213,588

NET POSITION RESTRICTED FOR PENSIONS = 77,788,792


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GASB 67

STATEMENT OF CHANGES IN FIDUCIARY NET POSITION

FOR THE YEAR ENDED SEPTEMBER 30, 2021

Market Value Basis

Additions

Contributions:Amount
Member506,015
City1,168,793
State792,050
Total Contribution2,466,858
Investment Income:Amount
Net Increase in Fair Value of Investments12,886,784
Interest & Dividends2,685,802
Less Investment Expense (Note 1)(263,992)
Net Investment Income15,308,594

Total Additions = 17,775,452


Deductions

Distributions to Members:Amount
Benefit Payments4,578,986
Lump Sum DROP Distributions0
Lump Sum PLOP Distributions74,609
Refunds of Member Contributions47,433
Total Distributions4,701,028
Administrative Expense97,821

Total Deductions = 4,798,849


Net Increase in Net Position = 12,976,603


NET POSITION RESTRICTED FOR PENSIONSAmount
Beginning of the Year64,812,189
End of the Year77,788,792


Note 1: Investment related expenses include investment advisory, custodial and performance monitoring fees.


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GASB 67

NOTES TO THE FINANCIAL STATEMENTS

(For the Year Ended September 30, 2021)

 

Plan Administration

The Plan is a single-employer defined benefit pension plan administered by the Plan's Board of Trustees comprised of:

  1. Four of whom are the Police Chief, Fire Chief, a Police Major Assistant Chief or other Police Officer designated by the Police Chief and the City Manager, and a Chief Officer or other Firefighter designated by the Fire Chief and the City Manager;
  2. Two of whom are full-time Firefighters and two of whom are full-time Police Officers who are elected by their respective departments by a majority of the members of the plan in those departments; and
  3. a Ninth Trustee who is chosen by a majority of the first eight Trustees

Plan Membership as of October 1, 2020:

Inactive plan Members or Beneficiaries Currently Receiving Benefits136
Inactive Plan Members Entitled to But Not Yet Receiving Benefits49
Active Plan Members139
Total
324

 

Benefits Provided

The Plan provides retirement, termination, disability and death benefits.
A summary of the benefit provisions can be found in the October 1, 2020 Actuarial Valuation Report for the City of Titusville Police Officers' and Firefighters' Pension Plan prepared by Foster & Foster Actuaries and Consultants.

Contributions

Members: 6.50% of Salary.

State: Tax on premiums for fire and casualty insurance issued to residents of the City as provided in Chapters 175 and 185, Florida Statutes.

City: Remaining amount necessary to pay the Normal Cost and fund the accrued, past service liability over 30 years.

Invested Policy:

The following was the Board's adopted asset allocation policy as of September 30, 2021:

Asset ClassTarget Allocation
All Cap Value Equity
27.5%
Broad Growth Equity
27.5%
Foreign Equity Securities
10.0%
Broad Market Fixed Income
20.0%
Global Bond
5.0%
Real Estate
10.0%
Total
100.0%


Concentrations:

The Plan did not hold investments in any one organization that represent 5 percent or more of the Pension Plan's Fiduciary Net Position.

Rate of Return:

For the year ended September 30, 2021, the annual money-weighted rate of return on Pension Plan investments, net of Pension Plan investment expense, was 24.12 percent.

The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested.


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GASB 67

Deferred Retirement Option Program

Eligibility: The original DROP is closed to any new participants after July 2, 2013. A subsequent program “DROP II” is available to participants effective December 10, 2019.

Participation: Not more than 60 months.

Rate of Return (DROP II): The Account is credited with the actual net rate of investment return (total return net of investment management fees, brokerage commissions and transaction costs) minus 2% after each fiscal year end. The annual return is subject to a minimum of 0% and a maximum equal to the current valuation investment return assumption as adopted by the Board.

The DROP balance as of September 30, 2021 is $205,341.

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GASB 67

NET PENSION LIABILITY OF THE SPONSOR

 The components of the Net Pension Liability of the Sponsor on September 30, 2021 were as follows:

Total Pension Liability$75,066,937
Plan Fiduciary Net Position$(77,788,792)
Sponsor's Net Pension Liability$(2,721,855)
Plan Fiduciary Net Position as a percentage of Total Pension Liability103.63%

 

Actuarial Assumptions:

The Total Pension Liability was determined by an actuarial valuation as of October 1, 2020 updated to September 30, 2021 using the following actuarial assumptions:

Inflation = 2.5%

Salary Increases = Service based

Discount Rate = 7.25%

Investment Rate of Return = 7.25%

Mortality Rate Healthy Active Lives:

Female:

PubS.H-2010 (Below Median) for Employees, set forward one year.

Male:

PubS.H-2010 (Below Median) for Employees, set forward one year.

Mortality Rate Healthy Retiree Lives:

Female:

PubS.H-2010 for Healthy Retirees, set forward one year

Male:

PubS.H-2010 (Below Median) for Healthy Retirees, set forward one year.

Mortality Rate Beneficiary Lives:

Female:

PubG.H-2010 (Above Median) for Healthy Retirees. 

Male:

PubG.H-2010 for Healthy Retirees, set back one year.

Mortality Rate Disabled Lives:

80% PubG.H-2010 for Disabled Retirees / 20% PubS.H-2010 for Disabled Retirees.

All rates are projected generationally with Mortality Improvement Scale MP-2018. We feel this assumption sufficiently accommodates future mortality improvements.

The previously described mortality assumption rates were mandated by Chapter 2015-157, Laws of Florida. This law mandates the use of the assumptions used in either of the two most recent valuations of the Florida Retirement System (FRS). The above rates are those outlined in Milliman’s July 1, 2020 FRS valuation report for special risk employees, with appropriate adjustments made based on plan demographics.

90% of active deaths are assumed to be service-incurred.

The most recent actuarial experience study used to review the other significant assumptions was dated August 17, 2018.

The Long-Term Expected Rate of Return on Pension Plan investments can be determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of Pension Plan investment expenses and inflation) are developed for each major asset class.

For 2021 the inflation rate assumption of the investment advisor was 2.50%.

These ranges are combined to produce the Long-Term Expected Rate of Return by weighting the expected future real rates of return

by the target asset allocation percentage and by adding expected inflation.

. 

 City of Titusville Police Officers' and Firefighters' Pension Plan                                            FOSTER & FOSTER Pg. 48


 GASB 67

Best estimates of arithmetic real rates of return for each major asset class included in the Pension Plan's target asset allocation as of September 30, 2021 are summarized in the following table:

Asset ClassLong Term Expected Real Rate of Return (Note1)
All Cap Value Equity7.50%
Broad Growth Equity7.50%
Foreign Equity Securities8.50%
Broad Market Fixed Income2.50%
Global Bond3.50%
Real Estate4.50%

(Note 1) Source: AndCo Consulting

Discount Rate:

The Discount Rate used to measure the Total Pension Liability was 7.25 percent.

The projection of cash flows used to determine the Discount Rate assumed that Plan Member contributions will be made at the current contribution rate and that Sponsor contributions will be made at rates equal to the difference between actuarially determined contribution rates and the Member rate. Based on those assumptions, the Pension Plan's Fiduciary Net Position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the Long-Term Expected Rate of Return on Pension Plan investments was applied to all periods of projected benefit payments to determine the Total Pension Liability.

Category1% Decrease
6.25%
Current Discount Rate
7.25%
1% Increase
8.25%
Sponsor's Net Pension Liability$5,863,052$ (2,721,855)$ (9,883,067)



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GASB 67

SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS

Last 2 Fiscal Years

Total Pension Liability

Category09/30/202109/30/2020
Service Cost979,981954,126
Interest5,182,8925,120,422
Share Plan Allocation396,025390,554
Changes of benefit termsNO DATANO DATA
Different between Expected and Actual Experience827,101792,420
Changes of assumptions1,906,206365,429
Benefit Payments, including Refunds of Employee Contributions(4,701,028)(4,526,052)
Net Change in Total Pension Liability4,591,1773,096,899
Total Pension Liability - Beginning70,475,76067,378,861
Total Pension Liability - Ending (a)$75,066,937$70,475,760

Plan Fiduciary Net Position

Category09/30/202109/30/2020
Contributions - Employer1,168,7931,544,188
Contributions - State792,050781,108
Contributions - Employee506,015503,074
Net Investment Income15,308,5944,002,262
Benefit Payments, including Refunds of Employee Contributions(4,701,028)(4,526,052)
Administrative Expense(97,821)(106,805)
Net Change in Plan Fiduciary Net Position12,976,6032,197,775
Plan Fiduciary Net Position - Beginning64,812,18962,614,414
Plan Fiduciary Net Position - Ending (b)$77,788,792$64,812,189
Net Pension Liability - Ending (a) - (b)$ (2,721,855)$5,663,571
Plan Fiduciary Net Position as a percentage of the Total Pension Liability103.63%91.96%
Covered Payroll$ 7,778,316$7,745,593
Net Liability as a percentage of Covered Payroll-34.99%73.12%


Notes to Schedule:

Changes of Assumptions:

For measurement date 09/30/2021, the investment rate of return was lowered from 7.50% to 7.25% per year, net of investment related expenses.

For measurement date 09/30/2020, as mandated by Chapter 2015-157, Laws of Florida, the assumed rates of mortality were changed to the rates used in Milliman’s July 1, 2019 FRS valuation report for non-special-risk employees, with appropriate adjustments made based on plan demographics.

Additionally, the assumed investment rate of return was reduced from 7.75% to 7.50%, net of investment related expenses.

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 GASB 67

SCHEDULE OF CONTRIBUTIONS

Last 2 Fiscal Years

 

Fiscal Year EndedActuarially Determined ContributionContributions in relation to the Actuarially Determined ContributionsContribution Deficiency (Excess)Covered PayrollContributions as a percentage of Covered Payroll
09/30/2021$1,545,009$1,564,818$ (19,809)$7,778,31620.12%
09/30/2020$2,064,227$1,934,742$129,485$7,745,59324.98%


Notes to Schedule:

Valuation Date: 10/01/2019

Actuarially determined contribution rates are calculated as of October 1, two years prior to the end of the fiscal year in which contributions are reported.

Methods and assumptions used to determine contribution rates can be found in the October 1, 2019 Actuarial Valuation for the City of Titusville Police Officers' and Firefighters' Pension Plan prepared by Foster & Foster Actuaries and Consultants.



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GASB 67

SCHEDULE OF INVESTMENT RETURNS

Last 2 Fiscal Years

Fiscal Year EndedAnnual Money-Weighted Rate of Return Net of Investment Expense
09/30/202124.12%
09/30/20206.51%

 

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GASB 68

NOTES TO THE FINANCIAL STATEMENTS

(For the Year Ended September 30, 2021)

 

Plan Administration

The Plan is a single-employer defined benefit pension plan administered by the Plan's Board of Trustees comprised of:

  1. Four of whom are the Police Chief, Fire Chief, a Police Major Assistant Chief or other Police Officer designated by the Police Chief and the City Manager, and a Chief Officer or other Firefighter designated by the Fire Chief and the City Manager;
  2. Two of whom are full-time Firefighters and two of whom are full-time Police Officers who are elected by their respective departments by a majority of the members of the plan in those departments; and
  3. a Ninth Trustee who is chosen by a majority of the first eight Trustees

Plan Membership as of October 1, 2020:

Inactive plan Members or Beneficiaries Currently Receiving Benefits136
Inactive Plan Members Entitled to But Not Yet Receiving Benefits49
Active Plan Members139
Total
324

 

Benefits Provided

The Plan provides retirement, termination, disability and death benefits.
A summary of the benefit provisions can be found in the October 1, 2020 Actuarial Valuation Report for the City of Titusville Police Officers' and Firefighters' Pension Plan prepared by Foster & Foster Actuaries and Consultants.

Contributions

Members: 6.50% of Salary.

State: Tax on premiums for fire and casualty insurance issued to residents of the City as provided in Chapters 175 and 185, Florida Statutes.

City: Remaining amount necessary to pay the Normal Cost and fund the accrued, past service liability over 30 years.

Net Pension Liability

The measurement date is September 30, 2021.

The measurement period for the pension expense was October 1, 2020 to September 30, 2021.

The reporting period is October 1, 2020 through September 30, 2021.

The Sponsor's Net Pension Liability was measured as of September 30, 2021.

The Total Pension Liability used to calculate the Net Pension Liability was determined as of that date.

Actuarial Assumptions:

The Total Pension Liability was determined by an actuarial valuation as of October 1, 2020 updated to September 30, 2021 using the following actuarial assumptions:

Inflation = 2.50%

Salary Increases = Service based

Discount Rate = 7.25%

Investment Rate of Return = 7.25%

 

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 GASB 68

Mortality Rate Healthy Active Lives:

Female:

PubS.H-2010 (Below Median) for Employees, set forward one year.

Male:

PubS.H-2010 (Below Median) for Employees, set forward one year.

Mortality Rate Healthy Retiree Lives:

Female:

PubS.H-2010 for Healthy Retirees, set forward one year.

Male:

PubS.H-2010 (Below Median) for Healthy Retirees, set forward one year.

Mortality Rate Beneficiary Lives:

Female:

PubG.H-2010 (Above Median) for Healthy Retirees. 

Male:

PubG.H-2010 for Healthy Retirees, set back one year.

Mortality Rate Disabled Lives:

80% PubG.H-2010 for Disabled Retirees / 20% PubS.H-2010 for Disabled Retirees.

All rates are projected generationally with Mortality Improvement Scale MP-2018. We feel this assumption sufficiently accommodates future mortality improvements.

The previously described mortality assumption rates were mandated by Chapter 2015-157, Laws of Florida. This law mandates the use of the assumptions used in either of the two most recent valuations of the Florida Retirement System (FRS). The above rates are those outlined in Milliman’s July 1, 2020 FRS valuation report for special risk employees, with appropriate adjustments made based on plan demographics.

90% of active deaths are assumed to be service-incurred.

The most recent actuarial experience study used to review the other significant assumptions was dated August 17, 2018.

The Long-Term Expected Rate of Return on Pension Plan investments can be determined using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of Pension Plan investment expenses and inflation) are developed for each major asset class.

For 2021 the inflation rate assumption of the investment advisor was 2.50%.

These ranges are combined to produce the Long-Term Expected Rate of Return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation.

Best estimates of arithmetic real rates of return for each major asset class included in the Pension Plan's target asset allocation as of September 30, 2021 are summarized in the following table:

Asset ClassTarget AllocationLong Term Expected Real Rate of Return (Note1)
All Cap Value Equity27.5%7.50%
Broad Growth Equity27.5%7.50%
Foreign Equity Securities10.0%8.50%
Broad Market Fixed Income20.0%2.50%
Global Bond5.0%3.50%
Real Estate10.0%4.50%
Total100.0%NO DATA

(Note 1) Source: AndCo Consulting

Discount Rate:

The Discount Rate used to measure the Total Pension Liability was 7.25 percent.

The projection of cash flows used to determine the Discount Rate assumed that Plan Member contributions will be made at the current contribution rate and that Sponsor contributions will be made at rates equal to the difference between actuarially determined contribution rates and the Member rate. Based on those assumptions, the Pension Plan's Fiduciary Net Position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the Long-Term Expected Rate of Return on Pension Plan investments was applied to all periods of projected benefit payments to determine the Total Pension Liability.



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GASB 68

CHANGES IN NET PENSION LIABILITY

 

 

CategoryIncrease (Decrease)
Total Pension Liability
(a)
Increase (Decrease) Plan Fiduciary Net Position
(b)
Increase (Decrease) Net Pension Liability
(a) - (b)
Balances as of September 30, 2020$70,475,760$64,812,189$5,663,571

Changes for a Year:

CategoryIncrease (Decrease)
Total Pension Liability
(a)
Increase (Decrease) Plan Fiduciary Net Position
(b)
Increase (Decrease) Net Pension Liability
(a) - (b)
Service Cost
979,981NO DATA979,981
Interest
5,182,892NO DATA5,182,892
Share Plan Allocation
396,025NO DATA396,025
Differences between Expected and Actual Experience
827,101NO DATA827,101
Changes of assumptions
1,906,206NO DATA1,906,206
Changes of benefit terms
NO DATANO DATANO DATA
Contributions - Employer
NO DATA1,168,793(1,168,793)
Contributions - State
NO DATA792,050(792,050)
Contributions - Employee
NO DATA506,015(506,015)
Net Investment Income
NO DATA15,308,594(15,308,594)
Benefit Payments, including Refunds of Employee Contributions
(4,701,028)(4,701,028)NO DATA
Administrative Expense
NO DATA(97,821)97,821
Net Changes4,591,17712,976,603(8,385,426)
Balances at September 30, 2021$75,066,937$77,788,792$ (2,721,855)

Sensitivity of the Net Pension Liability to changes in the Discount Rate.

Category1% Decrease
6.25%
Current Discount Rate
7.25%
1% Increase
8.25%
Sponsor's Net Pension Liability$5,863,052$ (2,721,855)$ (9,883,067)

Pension Plan Fiduciary Net Position.

Detailed information about the pension Plan's Fiduciary Net Position is available in a separately issued Plan financial report.


 

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GASB 68

PENSION EXPENSE AND DEFERRED OUTFLOWS OF RESOURCES AND DEFERRED INFLOWS OF RESOURCES RELATED TO PENSIONS

For the year ended September 30, 2021, the Sponsor will recognize a Pension Expense of $223,750.

On September 30, 2021, the Sponsor reported Deferred Outflows of Resources and Deferred Inflows of Resources related to pensions from the following sources:

SourcesDeferred Outflows of ResourcesDeferred Inflows of Resources
Differences between Expected and Actual Experience1,243,47228,001
Changes of assumptions1,979,900NO DATA
Net difference between Projected and Actual Earnings on Pension Plan investments

NO DATA

6,979,288
Total$3,223,372$7,007,289


Amounts reported as Deferred Outflows of Resources and Deferred Inflows of Resources related to pensions will be recognized in Pension Expense as follows:

Year ended September 30:Amount
2022$ (509,209)
2023$ (541,634)
2024$ (1,172,709)
2025$ (1,560,365)
2026NO DATA
ThereafterNO DATA


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 GASB 68

SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS

Last 2 Fiscal Years

Total Pension Liability

Category09/30/202109/30/2020
Service Cost979,981954,126
Interest5,182,8925,120,422
Share Plan Allocation396,025390,554
Changes of benefit termsNO DATANO DATA
Differences between Expected and Actual Experience827,101792,420
Changes of assumption1,906,206365,429
Benefit Payments, including Refunds of Employee Contributions(4,701,028)(4,526,052)
Net Change in Total Pension Liability4,591,1773,096,899
Total Pension Liability - Beginning70,475,76067,378,861
Total Pension Liability - Ending (a)75,066,93770,475,760

Plan Fiduciary Net Position

Category09/30/202109/30/2020
Contributions - Employer1,168,7931,544,188
Contributions - State792,050781,108
Contributions - Employee506,015503,074
Net Investment Income15,308,5944,002,262
Benefit Payments, including Refunds of Employee Contributions(4,701,028)(4,526,052)
Administrative Expense(97,821)(106,805)
Net Change in Plan Fiduciary Net Position12,976,6032,197,775
Plan Fiduciary Net Position - Beginning64,812,18962,614,414
Plan Fiduciary Net Position - Ending (b)$77,788,792$64,812,189
Net Pension Liability - Ending (a) - (b)$ (2,721,855)$5,663,571
Plan Fiduciary Net Position as a percentage of the Total Pension Liability103.63%91.96%
Covered Payroll$7,778,316$7,745,593
Net Pension Liability as a percentage of Covered Payroll-34.99%73.12%


Notes to Schedule:

Changes of Assumptions:

For measurement date 09/30/2021, the investment rate of return was lowered from 7.50% to 7.25% per year, net of investment related expenses.

For measurement date 09/30/2020, as mandated by Chapter 2015-157, Laws of Florida, the assumed rates of mortality were changed to the rates used in Milliman’s July 1, 2019 FRS valuation report for special risk employees, with appropriate adjustments made based on plan demographics.

Additionally, the assumed investment rate of return was reduced from 7.75% to 7.50%, net of investment-related expenses.

 
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GASB 68

SCHEDULE OF CONTRIBUTIONS

Last 2 Fiscal Years

 

Fiscal Year EndedActuarially Determined ContributionContributions in relation to the Actuarially Determined ContributionsContribution Deficiency (Excess)Covered PayrollContributions as a percentage of Covered Payroll
09/30/2021$1,545,009$1,564,818$ (19,809)$7,778,31620.12%
09/30/2020$2,064,227$1,934,742$129,485$7,745,59324.98%


Notes to Schedule:

Valuation Date: 10/01/2019

Actuarially determined contribution rates are calculated as of October 1, two years prior to the end of the fiscal year in which contributions are reported.

Methods and assumptions used to determine contribution rates can be found in the October 1, 2019 Actuarial Valuation for the City of Titusville Police Officers' and Firefighters' Pension Plan prepared by Foster & Foster Actuaries and Consultants

 

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EXPENSE DEVELOPMENT AND AMORTIZATION SCHEDULES

 

 

The following information is not required to be disclosed but is provided for informational purposes.


 

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GASB 68

COMPONENTS OF PENSION EXPENSE

FISCAL YEAR SEPTEMBER 30, 2021

  

CategoryNet Pension LiabilityDeferred InflowsDeferred OutflowsPension Expense
Beginning balance$5,663,571$1,050,789$3,915,205NO DATA

Total Pension Liability

CategoryNet Pension LiabilityDeferred InflowsDeferred OutflowsPension Expense
Service Cost
979,981NO DATANO DATA979,981
Interest
5,182,892NO DATANO DATA5,189,892
Share Plan Allocation
396,025NO DATANO DATA396,025
Changes of benefit terms
NO DATANO DATANO DATANO DATA
Differences between Expected and Actual Experience with regard to economic or demographic assumptions

821,101

NO DATA

827,101

NO DATA
Current year amortization of experience difference
NO DATA(28,001)(377,075)349,074
Change in assumptions about future economic or demographic factors or other inputs

1,906,206

NO DATA

1,906,206

NO DATA
Current year amortization of change in assumptions
NO DATANO DATA(690,006)690,006
Benefit Payments, including Refunds of Employee Contributions
(4,701,028)NO DATANO DATANO DATA
Net Change4,591,177(28,001)1,666,2267,597,978

Plan Fiduciary Net Position

CategoryNet Pension LiabilityDeferred InflowsDeferred OutflowsPension Expense
Contributions - Employer1,168,793NO DATANO DATANO DATA
Contributions - State792,050NO DATANO DATANO DATA
Contributions - Employee506,015NO DATANO DATA(506,015)
Projected Net Investment Income4,773,465NO DATANO DATA(4,773,465)
Difference between projected and actual earnings on Pension Plan investments
10,535,129

10,535129

NO DATA

NO DATA
Pension Plan investments

NO DATANO DATA
Current year amortizationNO DATA(2,926,560)(733,991)(2,192,569)
Benefit Payments, including Refunds of Employee Contributions
(4,701,028)

NO DATA

NO DATA

NO DATA
Administrative Expenses(97,821)NO DATANO DATA97,821
Net Change12,976,6037,608,569(733,991)(7,374,228)
Ending Balance$ (2,721,855)$8,631,357$4,847,440$223,750


   


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GASB 68

AMORTIZATION SCHEDULE - INVESTMENTS

Increase (Decrease) in Pension Experience Arising from the Recognition of the Differences Between Projected and Actual Earnings on Pension Plan Investments

Plan Year EndingDifferences Between Projected and Actual EarningsRecognition Period (Years)2021202220232024202520262027202820292030
2021$(10,535,129)5$(2,107,025)$(2,107,026 )$(2,107,026 )$(2,107,026 )$(2,107,026 )NO DATANO DATANO DATANO DATANO DATA
2020$780,4315$156,086$156,086 $156,086 $156,086 NO DATANO DATANO DATANO DATANO DATANO DATA
2019$2,889,5235$577,905$577,905 $577,905 NO DATANO DATANO DATANO DATANO DATANO DATANO DATA
2018$ (876,259)5$ (175,252)$ (175,252 )NO DATANO DATANO DATANO DATANO DATANO DATANO DATANO DATA
2017$(3,221,413)5$ (644,2836)NO DATANO DATANO DATANO DATANO DATANO DATANO DATANO DATANO DATA
Net Increase (Decrease) in Pension ExpenseNO DATANO DATA$(2,192,569)$(1,548,287)$(1,373,035)$(1,950,940)$(2,107,026)NO DATANO DATANO DATANO DATANO DATA




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GASB 68

AMORTIZATION SCHEDULE - CHANGES OF ASSUMPTIONS

Increase (Decrease) in Pension Expense Arising from the Recognition of the Effects of Changes of Assumptions

Plan Year EndingChanges of AssumptionsRecognition Period (Years)2021202220232024202520262027202820292030
2021$1,906,2065$381,242$381,241$381,241$381,241$381,241NO DATANO DATANO DATANO DATANO DATA
2020$365,4295$73,086$73,086$73,086$73,086NO DATANO DATANO DATANO DATANO DATANO DATA
2018$1,178,3905$235,678$235,678NO DATANO DATANO DATANO DATANO DATANO DATANO DATANO DATA
Net Increase (Decrease) in Pension ExpenseNO DATANO DATA$690,006$690,005$454,327$454,327$381,241NO DATANO DATANO DATANO DATANO DATA





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GASB 68

AMORTIZATION SCHEDULE - EXPERIENCE

Increase (Decrease) in Pension Experience Arising from the Recognition of the Differences Between Projected and Actual Earnings on Pension Plan Investments

Plan Year EndingDifferences Between Projected and Actual ExperienceRecognition Period (Years)2021202220232024202520262027202820292030
2021$827,1015$165,421$165,420$165,420 $165,420 $165,420 NO DATANO DATANO DATANO DATANO DATA
2020$792,4205$158,484$158,484$158,484$158,484NO DATANO DATANO DATANO DATANO DATANO DATA
2019$265,8525$53,170$53,170$53,170NO DATANO DATANO DATANO DATANO DATANO DATANO DATA
2018$(140,006)5$(28,001)$28,001)NO DATANO DATANO DATANO DATANO DATANO DATANO DATANO DATA
Net Increase (Decrease) in Pension ExpenseNO DATANO DATA$349,074$349,073$349,074$323,904$165,420NO DATANO DATANO DATANO DATANO DATA


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