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Bob Hudson

Beach Fanatic
May 10, 2008
1,066
739
Santa Rosa Beach
Have you read the Actuarial Study posted ? Mr. Livingstons statements are all covered in the study dated Feb 2011.

The assumed rate of return for the study is 8.0% - the actual rate of return on the plan since 2008 has been -3.0%. The plan lost 19.0% of its value in 2008.

The unfunded portion of the plans needs - if all current employee's work until normal retirement the plan would require either investment returns or contributions of $24.43 million. The study gives numbers of contributions/returns on investments needed each year to meet that requirement

The plan participants have earned (based on the assumptions) $9,304,046. That is what the plan owes them today based on their years of service today not when they retire. The plan forecasts what would be needed to pay all of the benefits to all of the current employees if they retired and live until the actuarially determined dates used in the study (from mortality table). The plan will need that additional 24.43 million in contributions and investment returns to meet those obligations in the future.

The difference between the "earned" benefit and the plan market value of $13,701,158 is not a surplus of funds needed in the future to meet plan obligations to its members. The plan defines years of service required to receive the defined benefit.

The earned benefit will climb each year as members complete more years of service.
 
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Henry Apfelbach

Beach Lover
May 14, 2011
61
13
Bob, I did not see where that was posted. Was that in a different thread? Either way I have some idea of those numbers. Does the return on investments only go back to 2008 in that report? I have been trying to figure out what the rate of return has been for the life of the plan I believe that it started in 1998 or 1999. Obviously 2008 was a bad year. That was one of the major contributors to the District having to pay a lot more to fund the plan. I gathered from the meetings that I attended when Buzz was still on the board he has a problem with the assumption of a 8% return. Who makes that reccomendation? That I am not clear on. I know the pension board has to approve it but I think they take advice from professionals right? If you know let me know.
 

30ashopper

SoWal Insider
Apr 30, 2008
6,846
3,471
56
Right here!
Have you read the Actuarial Study posted ? Mr. Livingstons statements are all covered in the study dated Feb 2011.

The assumed rate of return for the study is 8.0% - the actual rate of return on the plan since 2008 has been -3.0%. The plan lost 19.0% of its value in 2008.

The unfunded portion of the plans needs - if all current employee's work until normal retirement the plan would require either investment returns or contributions of $24.43 million. The study gives numbers of contributions/returns on investments needed each year to meet that requirement

The plan participants have earned (based on the assumptions) $9,304,046. That is what the plan owes them today based on their years of service today not when they retire. The plan forecasts what would be needed to pay all of the benefits to all of the current employees if they retired and live until the actuarially determined dates used in the study (from mortality table). The plan will need that additional 24.43 million in contributions and investment returns to meet those obligations in the future.

The difference between the "earned" benefit and the plan market value of $13,701,158 is not a surplus of funds needed in the future to meet plan obligations to its members. The plan defines years of service required to receive the defined benefit.

The earned benefit will climb each year as members complete more years of service.

We don't have enough information on this from this particular study. 2008 was an anomaly, as was 2010. We really need the return values stretching back to 1998 to get solid feel for how the fund has performed. It would also be good to know if the same fund manager at MS has been managing it all that time.

As far as growth assumptions go, I believe the legislature just passed a law stating that these funds must match FRS net return assumptions going forward.

I'm still digging through all this, might have some comments later.

A couple things that popped out at me - annual salary increases are averaging 9% a year (with a peak in 2008 of 13.2%), and the average salary is currently 62K a year? Did anybody else notice that? Payroll is also growing at an average annual rate of 17.2% (387% since 2000). At those growth rates there is trouble on the horizon. A majority of enrollees are still active, of which around 41% will hit 55 within the next fifteen years.
 
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30ashopper

SoWal Insider
Apr 30, 2008
6,846
3,471
56
Right here!
Bob, I did not see where that was posted. Was that in a different thread? Either way I have some idea of those numbers. Does the return on investments only go back to 2008 in that report? I have been trying to figure out what the rate of return has been for the life of the plan I believe that it started in 1998 or 1999. Obviously 2008 was a bad year. That was one of the major contributors to the District having to pay a lot more to fund the plan. I gathered from the meetings that I attended when Buzz was still on the board he has a problem with the assumption of a 8% return. Who makes that reccomendation? That I am not clear on. I know the pension board has to approve it but I think they take advice from professionals right? If you know let me know.

If would great if you could dig up all the actuarial studies going back to 1999 and post them here so we can figure that out. That's an important number.
 

Bob Wells

Beach Fanatic
Jul 25, 2008
3,380
2,857
The main reason as I remember was that the legislature had to much control over FRS. It was a negotiated item between labor and management. As for what it is best, I am not sure on whose opinion that is based.
 

30ashopper

SoWal Insider
Apr 30, 2008
6,846
3,471
56
Right here!
Could somebody answer my question: Why doesn't the Fire Dept belong to the FRS? Seems that would be the best way to go in the long run.

Not for the firefighters, their benefits package negotiated down here at the county level is far more lucrative than anything FRS offers. They also have more control over contract negotiations as well.
 

Bob Wells

Beach Fanatic
Jul 25, 2008
3,380
2,857
Not for the firefighters, their benefits package negotiated down here at the county level is far more lucrative than anything FRS offers. They also have more control over contract negotiations as well.

How is that? Up til this year, FRS receive a COLA, 175 participants don't unless its negotiated, FRS employees until the change this year, receive a insurance stipend 175 doesn't unless its negotiated. As for negotiations there are 2 sides, if you do not feel you are being fairly represented then maybe you should run and change your representation. Just saying.
 
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30ashopper

SoWal Insider
Apr 30, 2008
6,846
3,471
56
Right here!
How is that? Up til this year, FRS receive a COLA, 175 participants don't unless its negotiated, FRS employees until the change this year, receive a insurance stipend 175 doesn't unless its negotiated.

25 years of service (only?) yields 75% of annual pay in benefits under FRS. Firefighters in the district are making respectable six figure salaries when you add it up.. so I'm a little flabbergasted by your complaints about how bad you supposedly have it. What's the median houshold income in Walton County these days? 35K a year I think?

As for negotiations there are 2 sides, if you do not feel you are being fairly represented then maybe you should run and change your representation. Just saying.

Maybe we do need put some new people in place to negotiate.
 
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