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Attachment B 3. Hear a Request from the Roseville Fire Relief Association for a Pension Benefit Increase Association Treasurer Jim Bodsgard and Assistant Treasurer Dennis Koehntopp (K��!- TOP) presented a Bench Handout entitled; "Roseville Firefighter's Relief Association Request for Increase in Pension" dated July 17, 2006 (attached). Mr. Bodsgard and Mr. Koehntopptook turns providing detailed actuarial figures; financial impacts; peer association comparisons; and benefit rate information related to their request for an inflation-based rate increase and support for a$2.00 annual increase for association benefits. Discussion included accumulated interest on investments as monitored by the State of MN; annual requirementsfor funding the Relief Fund; no additional liability for the City based on $2 additional per month; funded ratio assumptions and reductions from 88% to 80%; risk management; amortization over finrenty years of unfunded liability; number of participants; Public Employee RetirementAssociation (PERA) status of some firefighters, currently affecting two (2) City employees; and the need to consider as part of the 2007 budget, with City Finance Director Chris Milier advising that it had already been appropriated into the 2007 budget, but would require ongoing commitment. Additional discussion included historical data; most recent pay increase in the year 2000; investments under the management of the Minnesota State Board of Administration; workers compensation and disability provisions related to pension draws; Attorney General opinion regarding "double-dipping"with State Statute and City Council policy silent on the issue; revision of Association by-laws; and eligibility definitions. Benchmarks Request a Resolution for Increase: Social Security Cost of Living Allowance (COLA) has increased 12.9% over the last 5 years; I nflation from Consumer Price Index (CPI) has increased over 13% during last 5 years; and This proposal of $2.00 represents a total increase of 7.4°/a, but only 1.5% increase peryear. Establish a Plan or Policy on Future Increases: Future increases could be based on an Index Scale; SSA; orState of MN — PERA Proposal for Guidelines for Future Increases "The Association would like to have the City Council considerthis proposal as to how future increases to its members would be granted. Currently, we have done as we just completed the request to have a$2.00lyear increase, rising from $27 to $291year of service to its members. The Association would like to propose that in the future, increases would be based on the Cost of Living Allowance (COLA) that the yearly Social Security increase is based on. We would like to have this increase effective with the year 2006 and 2007, with the increase effective January 1, 2008. The Association would recommend the increase be rounded up to the nearest quarter of a dollar. The COLA for the year 2006 would be based on the actual percentage increase, while the COLA for 2007 would be based on the estimated percentage increase. This format would be followed in future years, actual percentage in the odd years and estimated percentage in the even years. The rationale behind this is that the Association is required by Minnesota Statute to have an