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REQUEST FOR COUNCIL ACTION Date: July 1, 2013 Item No.: 10.c Department Approval City Manager Approval Item Description: Roseville Fire Relief Association Discussion B ACKGROUND 1 The Roseville Fire Relief Association has requested that the City consider raising the monthly 2 benefit its members currently receive from $30 to $32 per month for each year of service. 3 Prior to considering this request, staff would like to provide the City Council with information 4 regarding the history of the Roseville Fire Relief Association and the future of the fire relief 5 pension. 6 st Staff has created a detailed presentation that it will share with the City Council during the July 1 7 meeting. Some of the highlights from the presentations include: 8 The Relief Association is statutorily established and is a separate legal entity from the 9 City of Roseville and the Fire Department. It exists to provide a retirement incentive for 10 firefighters. It is self-governing. It is designed to provide for the option of lump sum 11 benefit or monthly benefits. By definition, it is considered a defined benefit plan. 12 A board of nine trustees manages the business of the Relief Association. Six of the board 13 members are elected from the membership of the Association, one of which may be a 14 retired member receiving a monthly pension. The elected members serve three year terms 15 on a rotating basis. The three remaining trustees serve on the board per state law. These 16 ex-officio members are the Fire Chief, the Mayor, and the City Manager. 17 The Relief Association's first funding source is the State of Minnesota, which levies a 2% 18 tax on all fire insurance premiums paid in to the State. These monies are allocated to the 19 municipalities according to a formula which considers the population and taxable 20 property of the municipality. If State aid is not sufficient to meet the Association’s 21 benefit requirements, the City of Roseville is required to fund the difference. 22 In 2010 the City decided to change the pension option provided to part-time firefighters. 23 The City agreed to no longer offer the Relief Association as a pension option but to place 24 all newly hired firefighters into Public Employee Retirement Association (PERA). 25 Current employees in the Relief Association were offered a one-time possibility to switch 26 to PERA. 27 Since no new members are being added to the Relief Association, there will come a point 28 in the future that there will be no designated beneficiaries. In recognition of that fact, 29 staff believes that there should be a discussion with the Fire Relief Association on how 30 Page 1 of 2