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C'iTY OF ROSEVILLE
<br />NOTES TO FINANCIAL STATEMENTS
<br />DEC'EMBER 31. 1997
<br />Note 8 Defined Berefi[ Pe Pians - Statewide - n in
<br />PERA provides retirement benefits as well as disabiliry ber�fits to members and benefits to survivors upon death of eligible members.
<br />Benefits are established by State Statute, arKi vest after three years of credited service. The defined retirement benefits are based on a
<br />member's highest average salary for any five successive years of allowable service, age, and years of credit at temiination of service.
<br />Two methods are used ro compute benefits for PERF's Coordinated and Basic Plan members. The retiring member receives the higher
<br />of step-rate ber�efit accrual formula (Me[hod 1) or a level acerual forniula (Me[hod 2). Under Method 1, the annuiry accrual ydte for a
<br />gasic plan member who retires before July 1, 1997 is 2 percent of average salary for each of the first 10 years of service and 2.5 percent
<br />for each remaimng year. The annuity accrual rate for Basic members who retire on or after ]uly 1, 1997 is 2.2 percent of average salary
<br />for each of the first 10 years of service ard 2.7 percent for each remaining year. For a Coordinared Plan member who retires before JWy
<br />1, 199'7, the aruavty accn�al rate is 1 percent of average satary for each of the tirst 10 years and 1.5 percent for each remaining year. Por
<br />Coordimced memlxrs who retire on or after July l, 1997, the annuiry accruel rates inc rease by 0.2 percent to (1.2 percent of average salary
<br />for each of the first 10 years ard 1J percent for each remaining year.) Under Method 2, diz annuiry accrual rate is 2.5 percent for Basic
<br />Plan members and l.5 pereent for Coordina[ed Plan members who retire before July 1, 1997.Annuity accrual rates inc reaee 0.2 percent
<br />for members who retire on or after JWy i, 1997. For PEPFF members, the annuity accrual rate is 2.65 pzrcent for each year of service
<br />for members retiring before ]uly 1, 1997. Effecuve July 1, 1997, the annual accrual rate is increased ro 3.0 percent. For PERF members
<br />whose annuity is calculated using Method 1 and for all PEPFF members, a full annuiry is available when age pius years of service equal
<br />90. A reduced retirement annuity is also available to eligible members seeMng early retirement.
<br />There aze different types of annuities available to members upon retirement. A nomial annuity is a lifetime annuity that ceases upon the
<br />death of the retiree. No survivor annuity is payable. There are also various types of joint and survivor annuiry op[ioru available which
<br />wili reduce the monthly normal annuity amounc, because the annuiry is payable over joint lives_ Members may also leave their
<br />convibutions in the furd upon tem�ination of public service, in order ro qualify for a deferred armuiry at retirement age. Refunds of
<br />con[nbutions are available at any time to members who leave public service, but before retirement benefits begin.
<br />Ttie berefit pmvisions stated in tl�e previous paragraphs of this section are current provisionc and appiy to ac[ive plan participants. Vested,
<br />temiirtated employees who are entided to benefits but are not receiving them yet, are bound by the provisions in eftect at the time they last
<br />terniinated their public service.
<br />PERA issues a publicly available financial repott tha[ includes tinancial statements and required supplementary infonnation for PERF and
<br />pEpFF. That report may be obtair�ed by wnting to PERA, 514 St. Peter S[reet N200, St. PaW, Minnesota, 55102, or by caliing (612) 296-
<br />7460 or 1-800-652-9026.
<br />B. Funding Policy
<br />Minnesota Statwes Chapter 353 secs the rares for employer and employee contributioru. These stamtes are estabtished and amended by
<br />the state legislature. The City makes anrn�a� cQnuibuuons to the pe�uion pians equai to the a�nount reqwred by State Statutes. PERF Basic
<br />Planmembers ard Coordinated Plan members are required ro con[ribute 8.23� and 4.23�, respectively, of their annual covered salary.
<br />PEPFF members are required to con[ribute 7.60� of their annual covered salary. The Ciry of Roseviile is required to contnbute die
<br />following percentages of annual covered payroll: 10.73� for Basic Plan PERF members, 4.48� for Coordiru[ed Plan PERF members,
<br />ard 11.40�% for PEPFF mnnbers. The Ciry's coruributions to the Public Employees Retirement Fund for the years ending December 31,
<br />1997, 1996 and 1995 were $170,162, $173,241, and $18Q91I, respectively., equal [o the contractually required contributions for each
<br />year as set by State Statute. 'I'he Ciry's con[nbutionti ro the Public Employees Police & Fire Fund tor the years ending December 31, 1997,
<br />1996 and 1995 were $254,308, $249,841, and 5242, I73, respectively, equal ro the convactuatly required contributions for each year as
<br />set by State Statute.
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