Jacksonville Beach pension boards approve audits and actuarial valuations; funded ratios improve across plans

The Jacksonville Beach pension boards on their quarterly meeting approved the city’s audited financial statements for the year ended Sept. 30, 2020, and adopted annual actuarial valuations that show improved funding across the three plans.

Auditor Ryan Tucker of Purpose Grain Company told trustees the firm issued a clean, unmodified opinion on the financial statements and included an emphasis-of-matter paragraph about COVID-19’s uncertain longer-term effects. "You are receiving an unmodified opinion on these financial statements," Tucker said during the meeting.

The boards then voted to adopt the audit and, later, the actuarial valuations presented by Brad Armstrong of Gabriel Roder Smith and Company. Armstrong summarized the valuations and the mechanics behind the funding results, saying the general employees plan’s funded ratio rose to just over 80% and the police plan’s funded ratio rose to above 90%. "The firefighters saw the largest increase in funded ratio from 72.4 to 81%," Armstrong said, noting that a combination of actuarial assumption updates and recent contributions produced the gains.

Armstrong told trustees the actuarial reports are used to set required contributions for the fiscal year beginning Oct. 1 and to assess funding risks and trends. He highlighted assumptions used in the valuations, including a 7.5% assumed long-term investment return for the general and police plans and a 6.9% assumption for the firefighter plan required by the interlocal agreement with the City of Jacksonville.

The actuarial presentation also noted that the firefighter plan is a closed system with about 25 active members projected to retire over the next 10–15 years, which accelerates progress to full funding under a level-dollar amortization method. Armstrong said the interlocal agreement calls for truing up member contributions on a dollar basis between Jacksonville Beach and Jacksonville to avoid persistent imbalances.

The meeting closed with votes by each board to adopt the audit and the actuarial valuations; trustees agreed to carry forward the recommended required contributions and to continue monitoring assumptions and cash-flow risks.

The boards indicated they will revisit the long-term assumed rate of return at a future meeting after the investment consultant and actuary provide coordinated recommendations.

The pension administrator said staff will circulate the summary plan descriptions for statutory review and, if necessary, bring updates to a future meeting.