Annual_Report_1992_001 - Laserfiche WebLink

Home

LITY OF ROSEVILLE MINNESOTA NOTES TO FINANLIAL STATEMENTS DECEMBER 37. 1992 Note 8- Defined eenefit Pension Plans - Stateuide A. Plan Destription All full-2ime and certain pert-time employees of the City are covered by defined benefit pension plans adninistered by the Pubtic Employees Retirement Association of Minnesota (PERA). GERA administers the Public Employees Retirement FuM (PERF) and the Pubic Employers Potice and Fire Fund (PEPFF) uhich ere rost sharing multiple-emptoyer public employee retirement plans. PERF merti6ers betong to either the Coordinated Plan or the Basit Plan. Coordinated members are covered by Sociel Security and easic membersare not. All neu members must participate in the Coordinated Plen. Alt police offiters, fire fighters and peace officers uho quatify for mertibership by statute are covered by the PEPFP. The payroll for e�toyees covered by PERF and PEPFF tor the year ended Detenber 31, 1992, was 82,862,478 and Si,889,700 respectivety ; the City's totaL payroLL uas E5,576,246. Pera provides retirement benefits as uell as disability benefits to members, and benefits to survivors upon death of eligible members. Benefits are established by State Statute, end vest after three years of credited service. The defined retirement benetits are based on member�s everege selary for any five successive years of atlouable service, age, and years of credit et termination of service. Two methods are used to compute benefits for Coordinated and Basic members. 7he retiring member receives the higher of step•rate benetit eccruaL formula (Method 1) or a level accrual forrtula (Meihod 2). Under Method t, the annuity accrual rate for e Basic member is 2 percent of average satary for each of the first 10 years of service end 2.5 percent for each remaining year. For a Coordinated mertd�er, the annuity accrual rate is 1 percent of average salary for each of the first 70 years and 7.5 percent tor each remaining year. Using Method 2, the annuity accrual rete is 2.5 percent ot average salary for Basic members and 7.5 percent for Coordinated members. For PEPFF members, the ennuity accruat rate is 2.5 percent for each year of service. for PERF members whose annuity is calculated using Method 1, and for all PEPFF memhers, a futl annuity is eveileble when age plus yeers of service equat 90. There ere different types of annuities svaileble to rt�ers upon retirement. A normal annuity is e lifetime annuity that ceases upon the death of the retiree. No survivor annuity is peyabte. There are atso various types ot joint and survivor annuity options avaiteble which witl reduce the monthly normal annuity amount, beceuse the annuity is payable over joint lives. Members may atso leave their con[ributions in the fund upon termination of public service, in order to quatify for a deferred annuity at retirement age. Refunds of contributions ere availabte et any time to members uho leave public service, but before retirement benefits beg i n. 8. Lontributions Required and Contri6utions Mede Minnesota Statutes Chapter 353 sets the rates for emptoyer arx! employee tontributions. The City makes annual contributions to the pension plans equat to the emount required by state statues. According to Minnesota Statues Chapter 356.215, Sud. 4(g) the date of futt furding required for PERF and PEPFF is the year 2020. As part of the annual actuariet valuation, PERA's actuary determines the sufficiency of the statutory contribution rates towards meeting the required full funding deedline. The ectuary tompares the actuet contribution rate to a"required�� contribution rate. Current combined statutory contribution rates and attuarially required contribution rates for the plans are as follous: PERF: Besic and Coordinaied Plans PEPfF: Statutorv Rates E�tovee E�Lover 4.41% 4.74% 8X 12% Total contributions made by the City during fiscel year 1992 uere: PERF: PEPFf: TotaLs Amounts EmotoYee ErtploYer E 728,929 E 140,498 S 151,176 S 280.105 39 E 226.772 E 367.270 Reauired Rates 9.95% 18.bX Pertentage of Covered Payrotl EmoLovees Emptover 4.5% 8.0% 7.43� 72.00%