Police Pension Packet 2008 11-18-08 Yorkville Police Pension Fund Board
804 Game Farm Road
Yorkville, 1160560
(630) 553-4340
5:OOPM on Nov 18, 2008
Police Department Conference Room
A, genda
Attachments:
Meeting Minutes for Aug 12, 2008
Monthly Treasurer's Report as of Oct 31, 2008
House Bill 4603: Creditable Service Buyback
Revised Procedure for Early Withdrawal of Contributions
Bills for Payment
Municipal Public Safety Pension Reforms Act
Meeting Call to Order:
Roll Call:
Previous Meeting Minutes: Aug 12, 2008 Corrections/Approval
Motion to Approve:
Communications:
Monthly Treasurer's Report: as of 10/31/2008
Motion to Approve:
Real Estate Tax Levy for Fiscal 2008-09: $300,000.00
Checks Received:
July 22, 2008: $ 22,412.78
Aug 12, 2008: $ 122,756.89
Oct 14, 2008: $ 9,278.07
Oct 14,2008: $ 124,614.00
Total $279,061.74
Bills for Payment:
MVT management fees:
From Schwab#3137-9036 (Oct—Dec) $ 3,1 08.00
Cary Collins: Attorney (Oct,Nov, Dec) $ 600.00
Kelly Zabinski: IDOI 2008 Filing $ 1,275.00
William Powell $ 287.50
Transfer of Funds for Scott Fiandalo $2,487.99
Total Bills for Payment $ 7,758.49
Motion to Approve:
Investments:
Progress Reports from Mitchell,Vaught, and Taylor
Money transfers from YNB to Charles Schwab &Co
Pay to: Charles Schwab & Co.
Mail to:Institutional Client Service Group
P. O. Box 628290
Orlando, F132862-9906
Unfinished Business:
Fund Management Presentation by State Bank of Illinois
Pension Fund Admission Applications for
John Hunter
Behr R. Pfizenmaier
Officer Pleckbam to review personnel files
IDOI Filing Status:
New Business:
Year 2009 Meeting Dates: Feb 10, May 12, Aug 11,Nov 10
Motion to Approve:
Revised Procedure for Early Distributions
Motion to Approve:
New Officer: Christoper Hayes
House Bill 4603: Creditable Service Buyback
Municipal Public Safety Pension Reforms Act
TAX DETERMINATION LETTERS FROM THE IRS
Additional Business:
Adjournment: Motion to Approve:
2008 Meeting Dates: Tuesdays 2/12, 5113, 8112, 11118 @ 5PM file:Policelagendalagendallov 18 2008.doc
United City of Yorkville
800 Game Frame Road
Yorkville, Illinois 60560
EST 1836 Phone 630-553-1887 William Powell
Fax: 630-553-7575 Treasurer
ALE
Treasurer's Report
(As of Oct 31,2008
Dollars Percent
Cash: YNB (1) 197,775.61
Schwab 141 227.17
Total Cash: $339,002.78 13.1%
Schwab:
Fixed Securities: 1,443,72290 55.9%
E uities: 2 799 312.26 31.0%
Total Assets: $2,582,037.94
2007 Tax Lew Estimate: (Raid in 2008) $300,000.00
Actual Payments:
July 22, 2008: $ 22,412.78
Aug 12, 2008: $ 122,756.89
Oct 14,2008: $ 9,278.07
Oct 14 2008: 124 614.00
Total $279,061.74
Estimated monthly deposits: $13,000.00
Estimated monthly retiree payments: $ 9344.00
William Powell
Treasurer
United City of Yorkville File:T Report 103108.doc
(1) The board has established a$40,000.00 minimum balance
(2) The maximum equity percent is 45%by statue
Zabinski Consulting Services, Inc.
(630)939-7668-Kelly Zabinski
(630)989-0025- Terri Svec
Zabinski Consulting Services,Inc. P.O.Box 6534,Aurora,IL 60598-6534—Fax(630)978-8275
--- On Fri, 10/24/08, idoivpension @ins.state.il.us <idoipension@ ins.state-iLus>wrote:
From: idoi_pension @ins.state.iLus<idoi_pension @ins.state.il.us>
Subject: 3335, ACCEPTED FILING, YORKVILLE POLICE PENSION FUND, 20080402
To, zcsinc @sbcglobal.net
Cc: IDOI—Pension@ins.state.il.us
Date: Friday, October 24, 2008, 2:18 PM
STATUS OF FILING: ACCEPTED
FUND NAME : YORKVILLE POLICE PENSION FUND
FUND NUMBER : 3335
FUND TYPE : P
BID : 20080402
Confirmation Number : 4D7FAF813F
Submitter name : Calene M Zabinski.
Submitter phone : (630) 939-7668
Preparer name : Calene M Zabinski
Preparer phone : (630) 939--7668
************ DO NOT RESPOND TO THIS E-MAIL *************
Your filing has been received and loaded into the database.
The status of your filing can be checked using the Pension Web
site link (below) . If you have questions concerning your filing, you
can contact Mike Langenfeld by calling 1 (800)207-6958, or
via email at mike.langen£eld @illinois.gov
https://www.ins.state.il.us/public_pension/FundBtesting.ns f/filinghistory
Your filing generated the following report(s) :
Annual Statement Validation Report
Reports are available for viewing at the reports link(below) . Please allow
approximately 30 minutes from the time of this e-mail before attempting to
access
this link. This will allow sufficient time for your reports to be moved to the
web site.
This feature is intended to provide reports in a timely manner and to protect
all data of a sensitive nature.
https://www.ins.state.il.us/public pension/FundBtesting.nsf/reports
1 of 1 10/24/2008 2:22 PM
CERTIFICATION FORM
Annul Statement for Fiscal year Ended: 04/30/2008 of the
YORKWILLE POLICE PENSION FUND
Date of hurnetFi1ing 10/24/2008 11:57:10 AM Subrnnitted By: Calene M Zabinski
Pension Fund Number: 3335
Confirmation Number.4D7FAF813F Batch Identification(Bid)Number. 20080402
State of Illinois
County of Kendall
Presiderrt, Secretary,
and Treasurer of the
YORKVILLE POLICE PENSION FUND,
being duly sworn,each for himself deposes and says that they are the above described officers of the said
Pension Fund and that the electronically filed annual statement referred to above is a full,true and correct
exhibit of all Assets,Inabilities,Income,and Disbursements,and of the conditions of the said Fund on the said
day of 20_,and for the fiscal year ended on that day,according to their
information,knowledge,and belief,respectively and that the assets,liabilities,revenues,and expenses are in
agreement with the annual financial audit conducted by an independent certified public accountant with
generally accepted auditing standards for local govenmm ot. Subscribed and Sworn to before me this
day of 20�
President
Secretary
Treasurer
(Notary Public)
bnportant: Complete and mail to:
IDFPR-Division of Insurance
Public Pension-4th Floor
320 West Washington St.
Springfield,IL 62767-0001
1 of 1 10/24/2008 5:11 PM
MEMO
Date: November 12, 2008
To: Mayor Burd and the Yorkville City Council
From: William Powell, Treasurer
cc:Police Pension Board
Susan Mika, Finance Director
Subject: Required Reporting to Municipality By Pension Board
I have completed the attached "Required Report"which includes Larry Debord's
certification. Below are two remaining clauses of this statute that are directed to
the municipality. My comments are included for your consideration.
40 ILCS 513143 (a) Report by pension board
Before the pension board makes its report, the municipality shall have the assets
of the fund and their current market value verified by an independent certified
public accountant of its choice.
Wolf& Company provides the auditing services to both the City and Pension
Board;therefore, it is not necessary to seek additional verification by another
independent certified public accountant.
40 ILCS 513143 (b)
Publication:
The municipality is authorized to publish the report submitted under 40 ILCS 513-
143. This publication may be made, without limitation, by publication in a local
newspaper of general circulation in the municipality or by publication on the
municipality's internet website. If the municipality publishes the report, then that
publication must include all of the information submitted by the pension board
under 40 ILCS 513143 (a)1-9.
The City reserves the right to publish; however, this is an unnecessary cost and I
recommend no report publication at this time.
REQUIRED REPORTING TO MUNICIPALITY BY PENSION BOARD
As of 4/30/2008 fiscal year end
(40 ZLCS 5/3143) (from Ch. 108 1/2, par. 3143)
Sec. 3143. Report by pension board.
The pension board shall report annually to the city council or
board of trustees of the municipality on the condition of the
pension fund at the end of its most recently completed fiscal
year. The report shall be made prior to the council or board
meeting held for the levying of taxes for the year for which the
report is made.
1. Total Assets (cost): $ 2,156,872
Total Assets(market value): $2,156,872
2. Estimated receipts during the next succeeding fiscal year from:
Participant Contributions deducted from payroll $206,099
All other sources $248,988
3. Estimated amount required during the next succeeding fiscal year to:
(a)pay all pensions and other obligations provided in this Article $150,023
(b) meet the annual reguirements of the fund as provided in
Sections 3-125 and 3-1273, $3819800
4. Total Net Income received from investment of net assets: $130,128
Assumed Investment Return: 7.50%
Actual Investment Return: 7.21%
Total Net Income received from investment of net assets (fye 4/30/2007): $27,399
Assumed Investment Return(fye 4130/2007): 7.50%
Actual Investment Return(fye 4/3012007): 2.04%
5. Total number of Active Employees that are financially contributing to the fund: 28
6. Disbursements to:
(i)Annuitants in receipt of a regular retirement pension
Total number of annuitants: 0
Total amount that was disbursed in benefits: 0
(ii) Recipients being paid a disability pension
Total number of annuitants 0
Total amount that was disbursed in benefits 0
(iii) Survivors and children in receipt of benefits
Total number of annuitants: 0
Total amount that was disbursed in benefits: 0
7.Funded ratio of the fund 37.7%
8. Unfunded Liability $3,571,850
9. Investment Policy of the pension board under the statutory investment
restrictions imposed on the fund. See attachment.
Certification
I, Larry Debord, President of the Police Pension Board,United City of Yorkville,
Kendall County, Illinois, do hereby certify that this document is a true and correct
copy of "Required Reporting to Municipality By Pension Board"as outlined in
40 ILCS 5/3143.
Witness my hand this day of November, 2008.
Larry Debord
President of United City of Yorkville Police Pension Board
8 Kitchell,
Vaught
Taylor Inc.
Investment .Advisors
53 W.Jackson Suite 905
Chicago,IL 60604
312-922-1717 phone
312-922-1772 fax
Statement for Fourth Quarter 2008
For Services Rendered
To: Yorkville Police Pension Fund
Attn:Larry DeBord
800 Game Farm Road
Yorkville,TL 60560
Investment Management Fee
Fourth Quarter 2008
October 1,2008-Deccrnbcr 1;`-008
September 30,2008 Portfolio Value:$2,607,758.63
Quarterly Fee
First$2 Million @.50% _ $2,500.00
Next$3 Million @.40% — $607.76
Total Fee: $3,108
Allocate bill to individuals within group:
Name Acct.Number Portfolio Value Bill Amount
Yorkville Bonds 3137-9036 $1,721,816.08 $2,052
Yorkville Equities 3139-4036 $885,942.55 $1,056
Account 3139-4036 at Charles Schwab &Co.,Inc. has been charged$3,108. Charles Schwab &Co.,Inc.,
as custodian,makes no independent verification of the calculation of the billing amount,
which is the client's reponsibility.
�. Zabinski Consulting Services, Inc. Invoice
P.O. Box 6534
Aurora, IL 60598-6534
Invoice#: 316
Invoice Date: 8/31/2008
Due Date: 9/30/2008
Hill To:
Yorkville Police Pension Fund
Attn: Mr. William Powell
800 Gamefarm Road
Yorkville, IL 60560
Description Amount
Final billing for work related to the Annual Division of Insurance filing 1,275.00
for year ended April 30, 2008
Total $1,275.00
Phone# Payments/Credits $0.00
630-939-7668 Balance Due $1,275.00
Law Offices of Cary J. Collins, P.C. Invoice
2200 West Higgins Road Suite 155
Hoffman Estates, 1L 60169 Date Invoice#
Telephone 847-519-0010 Fax 847-519-0016 9/15/2008 3839
Bill To
Yorkville Police Pension Board
Atten:Chief Harold Martin
804 Game Fart Road
Yorkville IL 60564
Terms
Due on receipt
Description Amount
Quarterly retainer for the months of 600.00
OCTOBER,NOVEMBER&DECEMBER,2008
Total $600.00
Please make checks payable to the LAW OFFICES OF CARY J.COLLINS
Payments/Credits $o.aa
Balance Due $600.00
Police Pension Accourkting Services Log
Date Activity - Hours
e r-► c- t- a
AJC.,
G!�Ali 4--A . t,Oc.LfN.0 ��a L4&6a1.
a8 eu�aw `06c� `Q -= 0e ,� $ • o
e� CL f
O ID acixv Lc4 0 Ik" 5 t7wT Fns t.- O
Tl VPr
ALY160 1NPaq- AzraL L 0 'rA + cA.P(- Lam,-G..r 2�S
0 oa TK TIn As .. L 41.8 7.5
14101 Z o c� �� L �-ns r. . ,�
d 1_A 1u a Ff
6 S O 9a M a-�.� Gn.. f-PL A- � 6�-- d $ FLEtr,.—< s
�f i Ci' afJ1�b -r n 6
" 6-2-G ci-r e .: k t i�Icr /F1.4�3T a+Cio
oe o
7-29- 6,40,0,06L- -,-Z"- t- -44 c
a 6 'r- C-A i S c D LA d a
MOG C'� r r Lc-r T �fu RsALT
I+1 - o
r
Agenda. Meeting Mintues
Employee contributions, YNB Bank, Merrill Lynch data entry
Quarterly member contributions letters
State of Illinois internet filing for fiscal year end
file: Police Pension Time Log.xls
ILLINOIS DEPARTMENT OF FINANCIAL AND-PROFESSIONAL REGULATION DIVISION OF INSURANCE
DATE : 05/15/2008 INVOICE NO : E98296
YORKVILLE POLICE PENSION FUND TOTAL: $431.37
FY 2009 Compliance Fee
Total Assets
' 872.18
P03181 NOTICE
PUBLIC PENSION FUNDS
COMPLIANCE FEE
Public Act 93-32, effective July 1, 2003, (40 ILCS 5/1A-101 et seq.) provides that any pension fund that
is required to file an annual statement is also required to pay an annual compliance fee of .0002 of the
total assets of the fund, not to exceed an amount of $6,000. The annual compliance fee is due June 30 of
the current calendar year.
The Department is requiring that the annual compliance fee be submitted and paid by check. In order for the
Department to meet the State requirements associated with accepting checks, certain procedures must be
followed. One such procedure is the issuance of an invoice to each and every pension fund. The invoice number
should be referenced on your check upon payment. Please detach the bottom portion of the invoice and return
with payment. Please note that the invoice indicates "Payment Due Upon Receipt, Interest May Be Assessed
After 30 Days" but such language does not affect the due date of June 30, as established in 40 ILCS 5/1A-112
and should be disregarded.
The check should be made payable to the Illinois State Treasurer and should be submitted on or before
June 30 of the current calendar year. Additionally, the check must be sent to the attention of The
Department of Financial and Professional Regulation, Division of Insurance, P.O. Box 7087, Springfield,
Illinois 62791 and not the Pension Division. Failure to submit the annual compliance fee payment on or
before June 30 of the current calendar year or to make payment in the amount owed, as indicated on the
invoice, is a violation of 40 ILCS 5/1A-112 and 50 I11. Adm. Code 4415.
Any discrepancies in the calculated annual compliance fee, as indicated on the invoice, should be reported
to the Pension Division within 15-days of receipt of this notification. This invoice serves as
your notification pursuant to 5o 111. Adm. code 4415.50.
SHOW INVOICE NUMBER (E98296) ON REMITTANCE. DETACH BOTTOM PORTION AND RETURN WITH REMITTANCE.
DATE : 05/15/2008 INVOICE NO : E98296
Make checks payable to: ILLINOIS STATE TREASURER
Send to: DEPARTMENT OF FINANCIAL & PROFESSIONAL REGULATION
DIVISION OF INSURANCE
P 0 BOX 7087
SPRINGFIELD IL 62791
PAYMENT DUE UPON RECEIPT - INTEREST MAY BE ASSESSED AFTER 30 DAYS
BILL TO: ITEMIZED BILLINGS;
YORKVILLE POLICE PENSION FUND 75 PUBLIC PENSION FEES $431.37
Attn: Secretary
804 Game Farm Rd
Yorkville IL 60560
` TOTAL:!/ `� $431,37
!D Q"o S/�9,�8 C msce z e 14,8
850E98296975VO00004313700000000T
Subject: Procedure for Early Distributions from the Police Pension Fund(approved: May 13, 2008)
A. Procedure:
The United City of Yorkville Police Pension Plan is a"Defined Benefit Plan". When officer decides
to leave the department they may leave their funds in the pension plan,transfer them to another
qualified plan, or withdraw their contributions. If they decide to withdraw their contributions the
City will issue a form 1099—R. As a total distribution of their pension dollars, IRS Form 4972 may
also apply. Withholding Form W-4P will also be needed. Forms may be ordered from the IRS
website at www.IRS.gov or by calling 1-800-829-3676. (Note: forms found on the website are not
scannable; and therefore, cannot be used to file formal documentation with the IRS.)Form 1099-R
copies B, C, and 2 should be furnished to the recipient by February 2nd . IRS assistance maybe
requested for completing the 1099-R at 1-800-455-7438.
Form 1099-R will be filled out according to the officer's specific information such as age, disability,
taxable and nontaxable contributions, etc. When the officer decides to leave the department a letter
will be written informing them of their taxable and nontaxable contributions to pension plan. A
form W 4P, "Withholdings Certificate for Pension or Annuity Payments"will also be enclosed. The
letter will recommend that the recipient seek advice from a tax consultant before requesting a check
withdrawing his funds from the pension plan.
B. Sample Letter: Date:
Officer John
Subject: Statement of Contributions to the United City of Yorkville Police Pension Fund
The statement below shows your contributions in the United City of Yorkville Police Pension Fund
as of your resignation date of
Taxed Tax Deferred
Contributions Contributions
Your portion of the INIRF transfers: $ $
Transfer of Creditable Service $ $
Current Fiscal Year to Date $ $
Total Contributions: $ $
Please select one of the options below, sign and return this form
[ ] Option I: I wish to leave all contributions in the pension fund until further notice. I understand
that my contributions do not receive any interest.I may request withdrawal or transfer of all
contributions at a later date of my choosing.
[ ] Option 2: Transfer the funds via direct transfer into an IRA or qualified pension account. A
transfer request form is required from the receiving account. Upon receiving the signed
transfer form, with a signature guarantee, a check will be made out to the account on your
behalf and sent to the account manager. ( P-Te: Ems.P+-a 4 C-el LA-21 t cn s `r*A,,J ;L ,,-s &F-
,S eA{}t C,CAP Isar-T MA,-+f f'%.Fs p Of Ta Ao+z—,1*u+, Qou4 c_c? P="S tat F-0.001)
[ ] Option 3: Request a check for all contributions paid directly to you. Since withdrawal of
funds may or my not be a taxable event it is strongly recommended that you discuss your
options on dispersal of funds with a tax consultant before you request any action.
If you chose to withdraw your funds you are required to complete and submit the enclosed W-4P
form indicating tax withholding, if any, from the amount of the check. If you do not submit form
W-4P, 20% of the amount will be automatically withheld.
Signature: Signature Guarantee:
Please retain a copy of this letter for your records.
Treasurer: William Powell
United City of Yorkville
804 Game Farm Rd
Yorkville, IL 60560
cc: Police Pension Board
Finance Director
Date:
United City of Yorkville Police Pension Board
Subject: Direct Transfer of Contributions for Name
This letter is authorization to the United City of Yorkville Police Pension Board to
directly transfer all pension fund contributions for Officer's Name to Mutual Fund Name.
See attached transfer request from Mutual Fund Name.
The check should be made out to Mutual Fund Name for the benefit of Officer's Name
and sent directly to Mutual Fund Address Attn: Account Manager. This transfer is a
transfer of pre-taxed pension contributions into a traditional IRA account.
A 1099-R will be issued for this transaction at tax time and may or may not be taxable.
Signed:
Signature Guarantee.
C;, Sample Form 1.099-R:
In the example below, Officer John, age 35, has resigned from the department. He has taxable
contributions to the plan of$25,000.00 and he is not disabled. After consulting with a tax advisor he
has decided not to have funds withheld for taxes on Form W-4P.
rl CORRECTED(if chtacW
PAYER'S n2me.attest addrese,W smte,and ZIP oods 1 boas ChURRItion OMB prom 15"110 Distributions,From
U N trq Q C►-" 4r J o g IL V t Lt_ Penstans,AnnuMes,
8 o l{ a•T 7.S°eOrn°o•tn�><° R r or
prom-sharing tire 2 008 Plans,ITIAs,
.�
YO a-K%) 4LLE t�L {a G S6 C. o Od Cr0 Insurance
1,.1099-R Insurance
etc.
2b Tiombia■mound Toth I Copy a
nol detetlnlned +] dkWbution Report this
PAYER'S€edarai iCent+ficetian FiEQPft3fi'S lderdtlfr2llon ' MM iirpduded 4 Income
an your
Worst Um
number mc,i,v
�1^l4Q'sL retWiL It Odd
39—36 b k 9 Z 3 - $ torn snouts
RECIPIENT'S name 8 F[fpbyge torph�ufiane 6 Net ureaalrmd federal kwarrto
b I~ ER Tit�kA �Ralh epprecatio"k' tart x 4, et hl
In"W ee Piemlu'ra errrpdoyerla Wa copy
y $ Your stunt.
Shoat Wdremm Rnr*&h+8 epL od) 7 Qletrmutlon I Q+M s OUW
17,3 AAA u a) 5� °O�el ��, � This Infommelan Is
❑ being f=iqhP.d to
the Inlemal
City,slsta.and ZIP oode ON Your peroentepe of tuial Ob TaM el*fes mr6lhd6ie Revernre Service.
o n�t�t4� mss. 60 6 o &1bt'bM % $
1el yfm of doalp.meth mr4R► 10 3b to LM VHUq dd 11 Stmfilapds e1ale no. IN State dlsi Winn
Acepad nn:nber Isee i IrvcifM+) 19 Leeat tmt vrnld W 14 Nwne d
localflr 13 t.00el rIDdtCullon
b��lt27t. k SS ..._._____._............. ............................ S
---------------
F 1068-R
RipWtMrl a the lrrOrsvy-htanr Tww,ua Sanrlq
Sir; t-{�72 tTa� bra LuA,9-SOh�e5'N-nA,3\eo.vk
An-i-�7) 1 YT ILA 0`1-1 as
file:Early Withdrawal of Funds Procedure.doc
12. TAX DETERMINATION LETTERS FROM THE IRS
There is a plan in Illinois to seek two tax determination letters from the IRS. One for Illinois fire pension plans
and the other for Illinois police pension plans. Hereafter the plan will be referred to as the 'project . In short,
the project planners have worked out an agreement with the IRS that not only saves each of us money, but also
our time and efforts to complete the application process. Organizations like IMTA are being asked to support
the project and to encourage our F&P pension funds to voluntarily contribute $150 to $200 (once every five
years) needed to offset the necessary costs. Alone each F&P pension plan would have to pay the $1,000 IRS
filing fee plus the time and cost of completing the individual application forms.
The IPPFA has taken the lead role on this project and personally 1 believe they have done an outstanding job
coordinating this Project. Other players include the IRS, Division of Insurance, IMTA, IGFOA, Lauterbach &
Amen and Ice Miller LLP. Scott Brandt from Div of Ins will be the official°requester° on behalf of all F&P
pension funds. We anticipate the IRS will provide Scott with the two favorable letters prior to 113.112009.
Sherry Lauterbach, CPA has offered to keep a full accounting of the funds needed to secure the IRS tax letters
and to pay the charges relating to promoting and educating each of our organizations as to the necessity of this
project. Project representatives will meet with the IMTA Board in November at the Treasurer's Institute and
prove an update to the attendees. More details will follow.
1 of 1 10/22/2008 11:03 AM
Illinois Department of Financial and
.h Professional Regulation
R �, September 3, 2008
1 The Siren
Toll Free(800)207-6958 Scott J.Brandt,Acting Chief Administrator Fax(217)524-5978
Legislative Update
Police Pension Funds
U p d a ( a U p d a t e U p d a t e Public Act 095-0812 U p d a t e Up d a to U p d a t e
House Bill 4603 signed into Law August 13, 2008
Law became effective August 13, 2008
Additions to Illinois Law:
Transfer of Additional Creditable Service from Article 7, IMRF, to Article 3 Police Pension
Fund Not Credited Under Transfers Made In Accordance with P.A. 094-0356
Transfer of Additional Creditable Service from Article 3 Police Pension Fund to Article 7,
IMRF, Not Credited Under Transfers Made In Accordance with P.A. 094-0356
40 ILCS 513 -110. (e)(4) and 40 ILCS 517 - 139. (a) 10.
Transfer of Creditable Service from Article 7 IMRF to Article 3 Police Pension Fund
For The Amount of the Service Credit Reduction in a Transfer Under the Provisions of
Public Act 94-356
(40 ILCS 513-110.(e)(4))
(4) Until January 1. 2010, a police officer who transferred service from the Fund established under Article 7 of this
Code under the rp ovisions of Public Act 94-356 may establish additional credit, but only for the amount of the
service credit reduction in that transfer, as calculated under paragraph 3 of this subsection (e). This credit may be
established upon Payment by the police officer of an amount to be determined by the board equal to 1 the
amount that would have been contributed as employee and employer contributions had all of the service been as
an employee under this Article, plus interest thereon at the rate of 6% per year, compounded annually from the
date of service to the date of transfer, less 2 the total amount transferred from the Article 7 f=und plus 3 interest
on the difference at the rate of 6%per year, compounded annually, from the date of the transfer to the date of
payment. The additional service credit is allowed under this amendatory Act of the 95th General Assembl
notwithstanding the provisions of Article 7 terminating all transferred credits on the date of transfer.
Pension Division Advisory Services
(40 ILCS 517-139.11)
Until January 1, 2010, members who transferred service from an Article 3 system under the provisions of
Public Act 94-356 may establish additional credit in this Fund, but only up to the amount of the service credit
reduction in that transfer, as calculated under the actuarial assumptions.This credit may be established upon
payment by the member of an amount to be determined by the board, equal to (1) the amount that would have
been contributed as employee and employer contributions had all the service been as an employee under this
Article, plus interest thereon compounded annually from the date of service to the date of transfer, less (2) the total
amount transferred from the Article 3 system, plus (3) interest on.the difference at the effective rate for each year,
compounded annually, from the date of the transfer to the date of payment. The additional service credit is allowed
under this amendatory Act of the 95th General Assembly notwithstanding the provisions of Article 3 terminating all
transferred credits on the date of transfer.
For information on establishing additional service credit under this new section in IMRF, Article
7, please contact IMRF at 1-800-ASK-IMRF (1-800-275-4673) or visit their website at
www.imrf.org.
Synopsis:
In order to establish additional creditable service time under this Public Act 95-812 (HB 4603)
the individual must be an active police officer per 40 ILCS 511-103.1 Application of
amendments., which states :
'Amendments to this Code which have been or may be enacted shall be applicable only to persons who, on or
after the effective date thereof, are in service as an employee under the retirement system or pension fund covered
by the Article which is amended, unless the amendatory Act specifies otherwise.'
Public Act 95-812, 40 ILCS 5/3 -110. (e)(4) also requires a police officer to have transferred
service credits from Article 7 to Article 3 in accordance with Public Act 94-356, effective
712912005, which included Section 3-110. (e)(1) through (e)(3), in order to transfer or establish
service credit under the new Section 3-110. (e)(4).
The police officer may establish additional creditable service equal to the amount of time lost
due to the reduction of creditable service time during the transfer in accordance with the
previous Public Act 94-356. The police officer has until January 1, 2010, to establish this
additional creditable service time.
Article 7, IMRF, is not required to pay any additional amount to the Article 3 Police Pension
Fund under this new statutory language. The additional cost is to be paid in full by the police
officer.
In order to compute the amount the police officer is required to pay the Article 3 Police Pension
Fund the board needs to determine the amount of employer and employee contributions that
would have been contributed had all of the service been as an employee under the Article 3
Police Pension Fund. The board also needs to know the amount that was transferred to the fund
from IMRF in accordance with P.A. 94-356 (40 ILCS 517-139.11). The board will need to make
additional interest and arithmetic calculations.
2 Pension Division Advisory Services
In order to determine the amount of the employer and employee contributions that would have
been contributed and applicable to an officer in the Article 3 police pension fund, the board
needs to obtain: 1) the dates of service for the creditable service time transferred; 2) the Article
3 police pension fund's fiscal year end; 3) the individual's annual salary for each fiscal year for
which creditable service time was transferred; and 4) the Article 3 police pension fund's total
normal cost as a percentage of payroll from the fund's actuarial valuation or tax levy report for
each fiscal year for which creditable service time was transferred. The police pension fund will
also need to know the date of transfer used in the original transfer under P.A. 94-356.
For those Article 3 police pension funds that obtain salary information on a monthly basis, the
calculations explained later in this document should be computed on a monthly basis instead of
a yearly basis for a more accurate calculation of the amounts needed to determine the transfer
cost to the police officer.
The total normal cost percentage can be found in the actuarial valuation report, or tax levy
report, provided by the actuary. On the Department of Insurance or Department of Financial and
Professional Regulation tax levy report, this percentage can be found on the second page, third
line, which reads, "Percent of Total Normal Costs to Total Annual Salaries of $ ***.** is **.**%."
This percentage includes the police officer's contribution percentage to the Article 3 police
pension fund. The officer's salary history for the creditable service time transferred from IMRF
needs to be obtained as of the fiscal year end dates of the Article 3 police pension fund. For the
creditable service time transferred, "the contributions that would have been paid" plus interest
should equal the sum of each year's total normal cost plus interest applicable to the officer.
Each year's total normal cost plus interest should equal: 1) the total normal cost percentage for
a fiscal year for which creditable service time was transferred multiplied by 2) the salary
received at the end of the fiscal year plus 3) interest accumulated from the end of the fiscal year
through the date of original transfer under P.A. 94-356.
The police pension fund is to subtract from "the contributions that would have been paid" plus
interest, as described in the previous paragraph, the amount transferred to the Article 3 police
pension fund from IMRF under P.A. 94-356. The difference accumulates interest at 6% per year,
compounded annually from the original date of transfer to the date of payment. The resulting
amount is the amount the officer is required to pay the Article 3 police pension fund in order to
complete the transfer and credit the additional creditable service time previously lost.
The following example should more clearly illustrate the computations:
Example:
Information Needed:
1) Dates for which officer transferred creditable service time under IMRF to the Article 3 police
pension fund: June 30, 1990 through September 30, 1995
2) Fiscal year end of Article 3 police pension fund. (See Table 1 below).
3) The officer's salary/pay as an IMRF employee at the end of each of the Article 3 police
pension fund's fiscal years for which creditable service time was transferred. (See Table 1
below). These amounts may need to be obtained from either the former IMRF employee or
IMRF.
3 Pension Division Advisory Services
4) The total normal cost percentage for the Article 3 police pension fund corresponding to the
fiscal year for which creditable service time was transferred. (See Table 1 below).
5) Original Date of Transfer: 1213112005.
6) Date of Payment to transfer or establish additional service credits: 1213112008.
TABLE 1: IMRF Salary and Total Normal Cost Percentages
Police Pension Salary as an Total Normal Cost
Fiscal Year End IMRF Employee Percentage (Police Fund)
(FYE) (through FYE) (as of FYE)
April 30, 1991 $ 20,800.00 23.72%
April 30, 1992 $ 26,600.00 23.57%
April 30, 1 993 $ 27,400.00 23.81%
April 30, 1994 $ 28,200.00 23.94%
April 30, 1995 $ 29,000.00 24.27%
Sept. 30, 1995 $ 15,500.00 24.13%
Determination of the amount the officer will need-to pay to the Article 3 police
pension fund:
1) Determine the period of time between each fiscal year end for which creditable service time
was transferred and the original date of transfer. These periods will be used to determine the
interest attributed to the contributions that would have been paid into the Article 3 police pension
fund. Assumption: Date of Transfer(original) to be 1213112005. (See Table 2 below).
TABLE 2: Interest Period
Police Pension
Fiscal Year End Original
FYE Date of Transfer Interest Period
April 30, 1991 Dec. 31, 2005 14.6667 years (14 yrs, 8 mos. or 14 8112 yrs)
April 30, 1992 Dec. 31, 2005 13.6667 years
April 30, 1993 Dec. 31, 2005 12.6667 years
April 30, 1994 Dec. 31, 2005 11.6667 years
April 30, 1995 Dec. 31, 2005 10.6667 years
Sept. 30, 1995 Dec. 31, 2005 10.25 years (10 yrs, 3 mos. or 10 3112 yrs)
4 Pension Division Advisory Services
2) Determine the employee and employer contributions that would have been contributed in a
particular year by multiplying the salary paid in that year by the total normal cost percentage for
the corresponding year. (See Table 3 below).
TABLE I Total Normal Cost Calculation and Contribution Determination
Total Normal Cost
Police Pension Salary as Percentage Employee and
Fiscal Year End IMRF Employee (Police Fund) Employer Contribs.
F( YE) (through FYE (as of FYE (would have been paid)
April 30, 1991 $ 20,800.00 X .2372 = $ 4,933.76
April 30, 1992 $ 26,600.00 X .2357 - $ 6,269.62
April 30, 1993 $ 27,400.00 X .2381 = $ 6,523.94
April 30, 1994 $ 28,200.00 X .2394 - $ 6,751.08
April 30, 1995 $ 29,000.00 X .2427 = $ 7,038.30
Sept. 30, 1995 $ 15,500.00 X .2413 = $ 3,740.15
3) Determine the interest on the contribution amounts determined in Table 3. (See Table 4
below).
TABLE 4: Total Contribution Amount Plus Interest Calculation and Amount
Police Pension Employee and Contribution Plus Interest
Fiscal Year End Employer Contribs. Interest = [(Contribution Amount) X
FYE (Contribution Amount) Period ( 1+.06)^(Interest Period))1
April 30, 1991 $ 4,933.76 14.6667 $ 11,596.62
April 30, 1992 $ 6,269.62 13.6667 $ 13,902.37
April 30, 1993 $ 6,523.94 12.6667 $ 13,647.46
April 30, 1994 $ 6,751.08 11.6667 $ 13,323.22
April 30, 1995 $ 7,038.30 10.6667 $ 13,103.82
Sept. 30, 1995 $ 3,740.15 10.25 $ 6,796.33
Total Contributions that would have been made to the Article 3
police pension fund plus interest at the original date of transfer: $ 72,369.82
4) Determine the amount by which the contributions that would have been paid into the Article 3
police pension fund plus interest at the original date of transfer exceeds the amount transferred
from IMRF. This difference plus interest from the original date of transfer to the date of payment
under P.A. 95-812 is the amount the officer would need to pay the Article 3 police pension fund
for the transfer or establishment of the creditable service time previously lost. (See Table 5
below).
Assumed Date of Payment is 1213112008.
5 Pension Division Advisory Services
TABLE 5: Amount Police Officer Is Required to Pay the Police Pension Fund
Amount that would have been contributed as employee and
employer contributions plus interest through the date of original transfer: $ 72,369.82
less Amount transferred from IMRF on the original date of transfer: - $ 20,000.00
The Difference: $ 52,369.82
plus Interest on the Difference from the date of transfer through the
date of payment: + $_tQ34Qa.47
Date of Transfer: 12/31/2005
Date of Payment: 12/31/2008
Interest Period between A) and B): 3 years
Interest =[Difference X((1+.06)"(Interest Period))] -Difference
= [$52,369.82 X((1.06)"(3)1]-$52,369.82
=$62,373.29- $52,369.82
= $10,003.47
EQUALS Amount Police Officer Is Required to Pay the Police Pension Fund: $ 62,373.29
6 Pension Division Advisory Services
April 18, 2008
Subject: Transfers to the Police Pension Fund
The tables below show the employees who have transferred dollars and service to the Pension
Fund. Transfer amounts, additional service months, and adjusted service dates are listed.
Creditable Service: IMRF Buybacks:
Total IMRF Service Act Adjusted
Date Pension Taxed Non-Taxed Total Mo's Mos' Service Service
Name Received Fund$'s Portion Portion Cost Factor Service Credit Date Date
H. Martin 02/02/06 14,973.20 7,429.02 7,544.18 62,236.00 .24 46 12 04/03/79 04/03/78
B. Groesch 02/02/06 16,381.17 7,417.38 8,963.79 27,624.00 .59 24 15 02/15/84 11/15/82
R. Diedereich 02/02/06 14,393.08 65515.55 7,877.53 1 12320.00 1.17 21 21 01/01/78 04/01/7b
G. Calvert 02/02/06 33,126.941 14,995.88 18,131.061 44,630.00 .74 41 31 07/13/87 03/13/80
Creditable Service: Buybacks from Other Pension Funds:
Total Act Adjusted
Date Pension Taxed Non-Taxed Total Credited Service Service
Name Received Fund$'s Portion Portion Cost Service Date Date
A. Jeleniewski 04/20/07 46,172.00 46,I72.00 0.00 46,172.00 3yrs, lino, 02/04/04 12/19/00
16 da s
Andrew Jeleniewski Transfer of funds from Chicago Heights: $46,172.00
Creditable service between 01/12/1998 and 2/28/2001: 3 years 1 month, 16 days.
William Powell
file: IMRF transfers.doc
ReporEfolio Management Report Data: 30-Sep-09
Oki Second Natlonal Bank,AUroM rL Pledged To; YORKVILLE POLICE PENSION FUND Seconn V-C Page:126
Published: 10=006 8:37:34 AM
Salekeenlna
Code CuaIP Descriptlon Pool Moody Original Face Pledged Pledged Pledged Pledged
Trans* Mahaiy Prerehrnd Coupon SldPoor Pledged Percent Original Face VaWa Par Value Book Value Markei Valle
Location FAS 115
NTC 3123"M00 FHLMC One-Tlma Call Asa $110001000.00 $200,000.00 $200,000.00 $199,643.80 $200,231.66
0705310031 10712013 5.600 AAA 20.00%
NORTHERN TRUST COMPANY AFS
....... ......................_,.
i Aaencv NolaelBonde-FR- 3200.000.00 $200.000.00 '199.643.60 5200.2$1.69
..................
Total Pledged J. JE MP_ YORKVILLE POLICE PENSION FUND $200.000.00 I,Q0.000.00 5199.64160 8200.231.86
$0.00 Munis with MaturKy Under 2 Yearn $0.00 Other securities with Staled Maturity Under 2 Years
$0.00 Munis with Maturty Over 2 Years $200.000.00 Other securldes with Stated Maludy Over 2 Years
"N no date la shown,then there are no pledges For the current perlod.