Schedule of revenue, expenditures, other financing sources (uses) and changes in fund balances – budget and actual (budgetary basis) – Fire Special Revenue Fund

City of Coral Springs, Florida

Notes to Financial Statements

Note 14. Employee Retirement Plans (Continued)

Since the completion of the previous actuarial valuation, the following plan changes were adopted:

• The normal retirement age for employees hired after September 30, 2012, was changed from any age with 25 years of service to any age with 23 years of service. • An alternative benefit payable to a surviving spouse or dependent children of a vested employee who dies prior to retirement other than in the line of duty was added to the plan. • The maximum Deferred Retirement Option Plan (DROP) participation period was increased from five years to seven years and those employees who choose to enter the DROP with only 23 years of service and were hired after September 30, 2012, must continue to make the required employee contribution to the plan until they attain 25 years of service.

Firefighters’ Retirement Plan

The Firefighters’ Retirement Plan (the Fire Plan) is a single-employer defined benefit plan, which covers all full-time certified firefighters. The Fire Plan was established by the City Commission with an effective date of December 31, 2002. The Fire Plan is also governed by certain provisions of Chapters 112 and 175, Florida Statutes. A Board of Trustees administers the Fire Plan. All costs of administering the Fire Plan are paid from plan assets.

Benefits Provided

General Employees’ Retirement Plan

The General Plan provides retirement benefits as well as death and disability benefits. Benefits vest 50% after five years of continuous service, plus 5% for each additional year to 100% after 15 years. Employees who retire at age 55 with 10 years of service are entitled to a retirement benefit, payable monthly for life, in an amount equal to 3% of average monthly earnings times continuous service after January 1, 1991, and 2.5% of average monthly earnings times continuous service prior to January 1, 1991 for each year of credited service. Average monthly earnings are equal to 1/12 of the average annual earnings for the highest consecutive three years of the 10 full years’ immediately preceding actual retirement. Active members contributing 10% of earnings are also entitled to a 2% cost-of-living adjustment (COLA) beginning at retirement. On January 18, 2000, the City Commission approved a monthly stipend for future retirees of $200 from retirement to age 65 and $150 after age 65.

City of Coral Springs, Florida

Notes to Financial Statements

Note 14. Employee Retirement Plans (Continued) Police Officers’ Retirement Plan

The Police Plan provides retirement benefits as well as death and disability benefits. Eligibility for normal retirement is based on 20 years of continuous service regardless of age (or age 55 with 10 years of service) for participants hired prior to September 30, 2012. For participants hired after September 30, 2012, eligibility for normal retirement is based on 23 years of continuous service regardless of age (or age 55 with 10 years of service). Participants are eligible for early retirement at age 50 with at least 10 years of continuous service. The monthly retirement benefit shall be an amount determined as follows: 3.5% of the old average monthly earnings times continuous service earned prior to October 1, 2012, plus 3% of the new average monthly earnings times continuous service earned after September 30, 2012 where continuous service is limited to 25 years. Participants who earned at least 20 years of continuous service as of October 1, 2012, receive the 3.5% for all service up to 25 years. The maximum monthly retirement benefit is limited to $110,000 per year.

Old average monthly earnings means 1/12 of the arithmetic average annual earnings for the highest consecutive three years of the 10 full years immediately preceding the actual retirement or termination date of a member, provided that if a member has been employed for fewer than 3 years such average shall be taken only over the period of his actual employment. Earnings include all compensation excluding leave payouts at separation and offduty details. For purposes of inclusion in earnings, overtime shall be limited to 300 hours per calendar year, or a prorated amount for a partial year. Compensation other than base salary shall be limited to 14.5% of base salary. New average monthly earnings means 1/12 of the arithmetic average annual earnings for the highest consecutive four years of the 10 full years immediately preceding the actual retirement or termination date of a member. Earnings include base compensation only.

Firefighters’ Retirement Plan

The Fire Plan provides retirement benefits as well as death and disability benefits. Eligibility for normal retirement is based on age 55 with 10 years of service, age 52 with 20 years of service, age 56 with 3 years of service (12/31/02 entrants only) or any age with 25 years of service. Participants are eligible for early retirement at age 50 with at least 10 years of continuous service. The monthly retirement benefit shall be an amount determined as follows: 3.5% of the average monthly earnings times continuous service (2.25%, 3.25%, 3.5% or a blended rate for past service prior to December 31, 2002, depending on extent to which the member transferred the required additional contribution).

Average monthly earnings means the average annual earnings for the highest consecutive 3 years of the 10 full years immediately preceding the actual retirement or termination date of a member, provided that a member has been employed for fewer than three years such average shall be taken only over the period of actual employment.

City of Coral Springs, Florida

Notes to Financial Statements

Note 14. Employee Retirement Plans (Continued) Plan Membership

As of October 1, 2019, the following employees were covered by the benefit terms:

Inactive Plan Members or Beneficiaries Currently Receiving Benefits Inactive Plan Members Entitled to But Not Yet Receiving Active Members Total

General Employees’ Retirement Plan

Police Officers’ Retirement Plan Firefighters’ Retirement Plan

38 159 26 2 18 1 - 214 176 40 391 203

Contributions

General Employees’ Retirement Plan

The General Plan is closed. All participants are retired and therefore there are no employee contributions. The General Plan’s funding policy provides for periodic employer contributions at actuarially determined rates that, expressed as percentages of annual covered payroll, are sufficient to accumulate sufficient assets to pay benefits when due. Level percentages of payroll contribution rates are determined using the entry age normal actuarial cost method.

City contributions to the plan, as calculated by the plan actuary, are recognized as revenue when due and the City has made a formal commitment to provide the contributions. The City’s contribution for the fiscal year ended September 30, 2021, was $750,000. These were made in accordance with actuarially determined contribution requirements ascertained through an actuarial valuation performed on October 1, 2020.

City of Coral Springs, Florida

Notes to Financial Statements

Note 14. Employee Retirement Plans (Continued) Police Officers’ Retirement Plan

All participants are required to contribute 9.8% of their pensionable earnings to the plan. Pensionable earnings include total cash remuneration but excludes overtime, off-duty details, annual sick leave conversion payments, vacation payment incentive and all end of career payouts and are limited to 107.5% of base salary. Participants who earned at least 20 years of continuous service as of October 1, 2012, must contribute 9.875% of their pensionable earnings to the plan. Pensionable earnings include total compensation other than leave payouts at separation and compensation for off-duty detail. If a participant terminates employment, or dies before 5 years of credited service, accumulated employee contributions plus 3% interest for each completed year of service are refunded to the employee or designated beneficiary. The Police Plan’s funding policy provides for periodic employer contributions at actuarially determined rates that, expressed as percentage of annual covered payroll, are sufficient to accumulate sufficient assets to pay benefits when due. Level percentages of payroll contribution rates are determined using the entry age normal actuarial cost method. The City Commission establishes and may amend the contribution requirements of the plan members and the City.

Police Plan member contributions are recognized in the period in which the contributions are due. City contributions to the plan, as calculated by the plan actuary, are recognized as revenue when due and the City has made a formal commitment to provide the contributions. Contributions for the year ending September 30, 2021, totaling $16,927,172 were made in accordance with actuarially determined contribution requirements determined through an actuarial valuation performed on October 1, 2019. Contributions for the fiscal year ended September 30, 2021, were $13,924,728 for the employer and $1,757,326 for the employees. In addition, contributions in the amount of $1,245,118 were received from the State of Florida in accordance with Florida Statutes. These on-behalf payments were also recognized as revenue and expenditures in the General Fund.

Deferred Retirement Option Plan. The Deferred Retirement Option Plan (DROP) is available to all Police Plan participants who have attained their normal retirement age. Upon electing to participate in the DROP, members are considered to have retired for pension purposes of the pension plan but continue to remain in active employment with the City. Their benefits accumulate in a DROP account and continue to accrue interest until they retire from the City at which time DROP benefits will be paid. Maximum duration of participation is seven years and those employees who choose to enter the DROP with only 23 years of service and who were hired after September 30, 2012, must continue to make the required employee contribution to the plan until they attain 25 years of service. The election is irrevocable. The balance held by the Police Plan on September 30, 2021 pursuant to the DROP is $22,263,790.

Firefighters’ Retirement Plan

Participants are required to contribute 8.75% of their salary to the plan. For participants who have earned between 25-30 years of service, the required contribution is 5% of their salary. If a participant terminates employment, or dies before 10 years of credited service, accumulated employee contributions plus related investment earnings are refunded to the employee or designated beneficiary. The City Commission establishes and may amend the contribution requirements of the plan members and the City. The Fire Plan’s funding policy provides for periodic employer contributions at actuarially determined rates that, expressed as a percentage of annual covered payroll, are sufficient to accumulate sufficient assets to pay benefits when due. Level percentages of payroll contribution rates are determined using the entry age normal actuarial cost method. Significant actuarial assumptions used to compute contribution requirements are the same as those used to compute the pension benefit obligation.

City of Coral Springs, Florida

Notes to Financial Statements

Note 14. Employee Retirement Plans (Continued)

Fire Plan member contributions are recognized in the period in which the contributions are due. City contributions to the plan, as calculated by the plan actuary, are recognized as revenue when due and the City has made a formal commitment to provide the contributions. Contributions for the year ended September 30, 2021, totaling $6,955,442, were made in accordance with actuarially determined contribution requirements determined through an actuarial valuation performed on October 1, 2019. Contributions for the year ended September 30, 2021, were $3,872,961 for the employer and $1,354,859 for the employee. In addition, contributions in the amount of $1,727,622 were received from the State of Florida in accordance with Florida Statutes. These on-behalf payments were also recognized as revenue and expenditures in the General Fund.

Deferred Retirement Option Plan. The Deferred Retirement Option Plan (DROP) is available to all Fire Plan participants who have attained their normal retirement age. Upon electing to participate in the DROP, members are considered to have retired for pension purposes of the pension plan but continue to remain in active employment with the City. Their benefits accumulate in a DROP account and continue to accrue interest until they retire from the City at which time DROP benefits will be paid. Maximum duration of participation is five years, and the election is irrevocable. The balance held by the Fire Plan on September 30, 2021 pursuant to the DROP is $4,495,666.

City of Coral Springs, Florida

Notes to Financial Statements

Note 14. Employee Retirement Plans (Continued) Net Pension Liability (Asset)

The following schedule presents the change in net pension liability (asset) for the fiscal year ended September 30, 2021:

General

Employees Police Officers’ Firefighters’ Retirement Plan Retirement Plan Retirement Plan

Total pension liability

Service cost $ - $ 5,576,478 $ 4,789,849

Interest 617,482 20,890,435 8,187,356

Changes of benefit terms - 1,498,101 -

Demographic experience

- 10,883,338 Differences between expected and actual experience 190,191 (2,429,730)

Changes in assumptions Contributions-buy back Benefit payments, including refunds of employee contributions (5,919,509) 3,754

(980,954) (14,678,781) (1,654,783)

Net change in total pension liability

(173,281) 24,169,571 2,976,937

Total pension liability – beginning Total pension liability – ending (a)

9,990,197 279,994,682 105,202,294

$ 9,816,916 $ 304,164,253 $ 108,179,231

Plan fiduciary net position

Contributions-employer Contributions-employee Net investment income Benefit payments, including refunds of employee contributions Administrative expense

Net change in plan fiduciary net position Plan fiduciary net position – beginning Plan fiduciary net position – ending (b) City's net pension liability (asset) – (a) – (b)

$ 611,634 $ 11,194,923 $ 3,811,837

-

1,880,013 1,342,121 648,831 17,280,977 8,960,544

(980,954) (14,678,781) (1,654,783) (8,934) (206,918) (161,355) 270,577 15,470,214 12,298,364 7,851,066 236,923,382 113,654,745

$ 8,121,643 $ 252,393,596 ** $ 125,953,109

$ 1,695,273 $ 51,770,657 $ (17,773,878)

Plan fiduciary net position as a percentage of the total pension liability

82.73% 82.98% 116.43%

* In accordance with the provisions of the 2017 firefighters’ collective bargaining agreement, the City and Union agreed that excess insurance premium excise taxes will be used to fund the Coral Springs Firefighters’ Share Plan (the Share Plan) a defined contribution component of the Fire Plan, effective September 30, 2017. The Fiduciary Net Position above excludes contributions totaling $2,764,178 as of September 30, 2020, such amounts are restricted for future benefits and are not available to offset the total pension liability. The balance in the Share Plan on September 30, 2021 is $3,854,405.

**The net position ending balance excludes DROP amounts that are not available to fund the total pension liability. The Drop balances excluded for purposes of calculating net pension liability at year end are $18,043,454 for the Police Plan and $3,489,310 for the Fire Plan.