published: Sunday, July 15, 2012
League of Cities offers Avon Park pension plan option
By CHRISTOPHER TUFFLEY
AVON PARK -- One option for providing a retirement plan for the city's police and fire fighters is to contract with the Florida League of Cities municipal pension trust fund.
Essentially this means outsourcing the fund and its administration and relinquishing local control.
Paul Shamoun, an account executive for the League, presented an brief overview of his organization's program at the city council's special meeting Wednesday.
Shamoun said the Florida League of Cities pension fund began in 1983 and collectively manages plans for Florida municipalities. Each municipality agrees to abide by the terms of the master trust agreement.
The fund encompasses 199 plans, of which 133 are Defined Contribution Plans, 48 Defined Benefit plans and 15 Other Post Employment Benefit Plans.
Shamoun said there were more than 5,500 participants in total and $360 million in assets.
The plan is overseen by a board of trustees and an investment advisory committee.
Investment management, performance monitoring, custodial banking, record keeping and actuarial services are bundled into a full-service administration.
According to Shamoun, the municipal pension fund "has a high quality bias and makes conservative investments to seek long-term growth of capital, consistent returns and avoiding extreme volatility in the market valuation.
"Big spikes in the market, mean big spikes in the budget," he said. Typically, the pension plan assumes a 7.5 percent return on investments.
One of the biggest advantages to the League's pension plan is the economy of scale, Shamoun said. Another is lowered administrative costs.
He said Avon Park police officers could expect $27,000 to $28,000 in administration savings and firefighters would see approximately $25,000.
By state statute, it is up to the to board of trustees of the Avon Park police and fire pension fund to decide on the pension fund's future.
The city council, on the other hand, has the right to decide whether or not to contract law enforcement services to another organization.
According to the Florida constitution, however, electors have the ultimate say when transferring power from the local to the county -- i.e. from police department to sheriff's office.
Citizen's vote (by: Concerned - 11/25/2012)
Doesn't the citizens get a vote or not of turning relinquishing local control or anything else that give the control of Avon Park to another City or anyone else?
Wrong again (by: fortune400 - 7/18/2012)
Sorry, it should read Article VIII, section 2,3, and 4.
Wrong again (by: fortune400 - 7/17/2012)
Florida Constitution, Article VIII, Articles 2, 3, and 4 explains everything. Electors have the final say by special law. Before you post, do some research.
Savings (by: George - 7/15/2012)
Why on earth would anyone not want to save money. The amount between both those funds equals a job for someone.
Huh? (by: Concerned resident - 7/15/2012)
Please report where in the costitution this particular issue is referenced. When the issue of transfering power came up several years ago, it was incorrect that there was a needed referendum. We are no different than Polk County in how the costitution is written and their elected officials had no problem transferring law enforcement over to their sheriff.
Get over with it (by: Puppy love - 7/15/2012)
Just do it.
Constitution (by: Sam Schultz - 7/15/2012)
The reporter is incorrect.
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