Title
MOTION TO PASS PROPOSED ORDINANCE NO. 2026-05 ON FIRST READING.
PROPOSED ORDINANCE NO. 2026-05 IS AN ORDINANCE OF THE CITY OF PEMBROKE PINES, FLORIDA, AMENDING CHAPTER 38 OF THE CITY’S CODE OF ORDINANCES WHICH PROVIDES FOR THE RETIREMENT INCOME PLAN FOR GENERAL EMPLOYEES OF THE CITY OF PEMBROKE PINES TO COMPLETELY TERMINATE THE PLAN IN ACCORDANCE WITH THE PROVISIONS OF §38.070 OF THE CITY’S CODE; SPECIFICALLY AMENDING §38.002, ENTITLED “DEFINITIONS,” §38.005, ENTITLED “ACTIVE PARTICIPANTS,” §38.025 ENTITLED “BENEFITS,” § 38.031 ENTITLED “DEFERRED RETIREMENT OPTION PLAN,” §38.042 ENTITLED “DISABILITY BENEFITS,” §38.052 ENTITLED “OPTIONAL FORMS OF DISTRIBUTION,” §38.053 “ELECTION PROCEDURES,” AND §38.070 ENTITLED TERMINATION AND LIMITATION” FOR THE PURPOSES OF EFFECTUATING THE TERMINATION OF THE PLAN AS MORE FULLY PROVIDED FOR HEREIN; PROVIDING FOR CODIFICATION; PROVIDING FOR CONFLICTS; PROVIDING FOR SEVERABILITY; PROVIDING FOR AN EFFECTIVE DATE
Summary Explanation and Background
SUMMARY EXPLANATION AND BACKGROUND:
1. The General Employee Pension Plan has been closed to new entrants for more than a decade, and most existing participants have not accrued additional service credit since 2010. As a result, the Plan has become a legacy benefit with a steadily declining active population and increasing administrative and financial inefficiencies
2. To address these conditions, the proposed ordinance formally closes the General Employee Pension Plan effective September 30, 2026. Upon closure, all remaining participants-including retirees, terminated-vested members, and other eligible beneficiaries-will be offered a structured set of Pension Risk Transfer (PRT) options. These options are designed to provide flexibility to participants while reducing long-term plan liabilities and administrative exposure for the City.
3. Participants will be permitted to elect one of the following options:
A. Remain in the existing plan under current terms, with no new DROP participation permitted.
B. Lump-sum transfer of the participant’s actuarial value to a qualified retirement plan (e.g., IRA or employer-sponsored plan).
C. Lump-sum cash-out, subject to applicable tax rules and withholding.
D. Immediate annuity, purchased through the City’s PRT process.
4. To ensure accuracy, compliance, and fiduciary prudence, the City has engaged an independent consulting firm specializing in Pension Risk Transfer strategies. The consultant will assist with actuarial valuations, participant communications, option modeling, annuity procurement, and overall implementation of the PRT process.
5. The ordinance authorizes the City to proceed with the closure, administer participant elections, and execute all necessary agreements and transactions associated with the Pension Risk Transfer program.
Financial Impact
FINANCIAL IMPACT DETAIL:
a) Initial Cost: Expenses associated with termination of the plan will be covered with plan assets
b) Amount budgeted for this item in Account No: Not Applicable.
c) Source of funding for difference, if not fully budgeted: Not Applicable.
d) 5 year projection of the operational cost of the project Not Applicable.
e) Detail of additional staff requirements: Not Applicable.
FEASIBILITY REVIEW:
A feasibility review is required for the award, renewal and/or expiration of all function sourcing contracts. This analysis is to determine the financial effectiveness of function sourcing services.
a) Was a Feasibility Review/Cost Analysis of Out-Sourcing vs. In-House Labor Conducted for this service? Not Applicable.
b) If Yes, what is the total cost or total savings of utilizing Out-Sourcing vs. In-House Labor for this service? Not Applicable.
Business Impact Estimate for Proposed Ordinances
BUSINESS IMPACT ESTIMATE:
Pursuant to Section 166.041, F.S., a Business Impact Estimate must be prepared for certain ordinances that impact the operations of local businesses.
a) Is a Business Impact Estimate (BIE) Form attached to this Ordinance? Yes.
b) Is this Ordinance exempt from requiring an Business Impact Estimate (BIE)? No.