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CITY OF LITTLE CANADA, MINNESOTA <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />DECEMBER 31, 2015 <br /> <br /> <br /> <br />(60) <br /> <br />NOTE 7 DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED) <br />D. Pension Costs (Continued) <br />1. GERF Pension Costs (Continue) <br />A total of $43,038 reported as deferred outflows of resources related to pensions <br />resulting from City contributions subsequent to the measurement date will be <br />recognized as a reduction of the net pension liability in the year ended December 31, <br />2015. Other amounts reported as deferred outflows and inflows of resources related <br />to pensions will be recognized in pension expense as follows: <br /> <br />Year Ended December 31, <br />Pension <br />Expenses <br />Amount <br />2016 (16,768)$ <br />2017 (16,768) <br />2018 (16,768) <br />2019 23,182 <br /> <br /> <br />E. Actuarial Assumptions <br />The total pension liability in the June 30, 2015, actuarial valuation was determined using <br />the following actuarial assumptions: <br /> <br />Inflation 2.75% per year <br />Active Member Payroll Growth 3.50% per year <br />Investment Rate of Return 7.90% <br /> <br />Salary increases were based on a service-related table. Mortality rates for active <br />members, retirees, survivors, and disabilitants were based on RP-2000 tables for males <br />or females, as appropriate, with slight adjustments. Benefit increases for retirees are <br />assumed to be 1% effective every January 1st through 2026 and 2.5% thereafter. <br /> <br />Actuarial assumptions used in the June 30, 2015, valuation were based on the results of <br />actuarial experience studies. The experience study in the GERF was for the period <br />July 1, 2004, through June 30, 2008, with an update of economic assumptions in 2014. <br />Experience studies have not been prepared for PERA’s other plans, but assumptions <br />are reviewed annually.