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CITY OF ROSEVILLE <br />NOTES TO FINANCIAL STATEMENTS <br />DECEMBER 31, 2008 <br />NOTE 5 —OTHER INFORMATION (Continued) <br />D. Annual pension cost and net pension obligation (Continued) <br />The annual required contribution was determined as part of the January 1, 2007 actuarial valuation. The <br />actuarial assumptions included (a) 5% investment rate of return (net of administrative expenses); (b) a <br />mortality table of the 1983 Group Annuity Mortality Table for Males and Females; (c) termination of <br />6 percent rate from age 20 -30, grading to no terminations after age 50; (d) disability rates based upon 75 <br />percent of the Railroad Retirement Board Disability Rates; (e) entry age actuarial cost method based <br />upon age on employment date; (f) retirement age based upon the later of age 55 or 20 years of service; <br />(g) 85 percent of members are assumed to be married, with wives three years younger than husbands; (h) <br />normal form of payment based upon joint and 100 percent to survivor annuity; (i) asset basis based upon <br />market value; and (j) level dollar amortization which is sufficient to amortize the unfunded actuarial <br />accrued liability by a closed period ending December 31, 2017 and a closed period of 20 years for Plan <br />amendments. <br />The Fire Relief Association is required to have an actuarial valuation completed once every two years. <br />The latest actuarial value of plan liability on December 31, 2007 was $8,336,812. The value of the plan <br />assets, valued at market, totaled $8,328,320 on December 31, 2007. A six -year summary of Assets, <br />Liabilities and funding ratios are listed below: <br />Covered payroll is not an actuarial factor in determining benefits or funding obligations under applicable <br />Minnesota statutes. <br />73 <br />Schedule of Funding Progress <br />December 31, 2007 <br />Actuarial <br />Actu aria', <br />Unfunded <br />Value of <br />Accrued Liability <br />(Overfunded) <br />Funded <br />Year <br />Assets <br />(Entry Age) <br />Accrued Liability <br />Ratio <br />2002 <br />$ 51127,888 <br />$ 71489,194 <br />$ 21361,306 <br />68.5% <br />2003 <br />61195,089 <br />71760,496 <br />11565,407 <br />79.8% <br />2004 <br />61812,594 <br />71873,859 <br />11061,265 <br />86.5% <br />2005 <br />7,165, 225 <br />81099,640 <br />9341415 <br />88.5% <br />2006 <br />81007,935 <br />8,197, 703 <br />189,768 <br />97.7% <br />2007 <br />81328,320 <br />81336,812 <br />81492 <br />99.9% <br />Covered payroll is not an actuarial factor in determining benefits or funding obligations under applicable <br />Minnesota statutes. <br />73 <br />