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CITY OF ARDEN HILLS, MINNESOTA NOTES TO TIlE FINANCIAL STATEMENTS DECEMBER31,~~< . Note 4: DEFINED BENEFIT PENSION PLAN - STATEWIDE -lONTINUED. J. I There are different types of annUll1es available to membe. uDe~. A S~lif~ty f):llllDe . annUIty that ceases upon death of the retIree-no Slrrvlvorbr;~ IS. aJili.l .;rbere ~~;u~,~ ojJOJDt and survivor annuity options available which Mil be payat]e~ over join~es. e1nb~;- may also leave tbeu. contributions in the fund upon termination of public servi~e, in order to qualifY for a deferred annuity at re4ement age. Refunds of contributions are available at any time tJrnemol.l;:) whoJeave-pUblwseT"Vlt:~Oefo~-efuernent benefits begin, . The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to active plan participants. Vested, terminated employees, who are entitled to benefits but are not receiving them yet, are bound by the provisions in effect at the time they last terminated their public service, PERA issues a publlcly available financial report that includes fmancial statements and required supplementary infonnation for PERF aud PEPFF. That report may be obtained on tbe web at mnpera.org, by writing to PERA, 60 Empire Drive #200, SL Paul, Miuuesota, 55103-2088 or by calling (651) 296-7460 or 1-800-652.9026. R Funding Policy Minnesota statutes, chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the State legislature, The City makes annual contributions to the pension plans equal to the amount required by 1'vlinnesota statutes. PERF Basic Plan members and Coordinated Plan members are required to contribute 9.10 percent and 5.10 percent, respectively> of their annual covered salary. PEPFF members were required to contnbute 6.20 percent of their annual covered salary. The City is required to contribute the following percentages of annual covered payroll: 11.78 percent for Basic Plan PERF members, 5.53 percent for Coordinated PIau PERF members, aud 9.30 percent for PEPFF members. The City's contributions to the PERF for the years ending December 31, 2005,2004 aud 2003 were $61,615, $61,421, aud $57,633, respectively, The City's . contributions were equal to the contractually required contributions for each year as set by Minnesota statute. Note 5: OTHER INFORMA nON A, Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; injuries to employees; and natural disasters for which the City carries m',;urance. The City obtains iusuraucc through participation in the League of Miuuesota Cities Insurance Trust (LMCIT) which is a risk sharing pool wjth approxliuately 800 other governmental units. 1be City pays au annual premium to LMClT for its workers compensation and property and casualty insurance. The LMCIT is self sustaining through member premiums and will reinsure for claims above a prescribed dollar amount for each insurance event. Settled claims have not exceeded the City's coverage in any of the past three fiscal years. Liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Liabilities, if auy, include an amount for claims that have been incurred but not reported (IBNRs), The City's management is not aware of any incurred but not reported claims. B. Legal Debt Margin The City's statutory debt limit is computed as two percent of the taxable market value of property within the City. Long-term debt issued and financed partially or entirely by special assessments or the net revenues of enterprise fund operations is excluded from the debt lImit computation. There is no outstanding debt at year end that is applied against the statutory debt limit. . .37.