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CITY OF LITTLE CANADA, MINNESOTA <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />DECEMBER 31, 2019 <br /> <br /> <br /> <br /> <br /> <br />NOTE 7 DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED) <br />D. Pension Costs (Continued) <br />1. General Employees Fund Pensions Costs (Continued) <br />For the year ended December 31, 2019, the City recognized pension expense of $63,961 for its <br />proportionate share of the General Employees Plan’s pension expense. In addition, the City <br />recognized an additional $2,034 as pension expense (and grant revenue) for its proportionate <br />share of the State of Minnesota’s contribution of $16 million to the General Employees Fund. <br /> <br />At December 31, 2019, the City reported its proportionate share of the General Employees <br />Plan’s deferred outflows of resources and deferred inflows of resources related to pensions <br />from the following sources: <br />Description <br />Deferred <br />Outflows of <br />Resources <br />Deferred <br />Inflows of <br />Resources <br />Differences between expected and actual economic experience $ 24,209 $ - <br />Changes in actuarial assumption - 68,661 <br />Net differences between projected and actual earnings <br /> on pension plan investments - 88,544 <br />Changes in proportion and differences between city <br /> contributions and proportionate share of contributions 9,185 76,636 <br />City contributions subsequent to the measurement date 43,384 - <br /> Total $ 76,778 $ 233,841 <br /> <br />The $43,384 reported as deferred outflows of resources related to pensions resulting from City <br />contributions subsequent to the measurement date will be recognized as a reduction of the net <br />pension liability in the year ended December 31, 2020. Other amounts reported as deferred <br />outflows and deferred inflows of resources related to pensions will be recognized in pension <br />expense as follows: <br /> <br />Year Ended December 31, <br />Pension Expenses <br />Amount <br />2020 $ (75,085) <br />2021 (87,503) <br />2022 (39,268) <br />2023 1,409 <br /> <br />E. Actuarial Assumptions <br />The total pension liability in the June 30, 2019, actuarial valuation was determined using the <br />following actuarial assumptions: <br /> <br />Inflation 2.50% per year <br />Active member payroll growth 3.25% per year <br />Investment rate of return 7.50% <br /> <br />Salary increases were based on a service-related table. Mortality rates for active members, retirees, <br />survivors, and disabilitants were based on RP-2014 tables for males or females, as appropriate, with <br />slight adjustments to fit PERA’s experience. Cost of living benefit increases for retirees are <br />assumed to be 1.25% per year for the General Employees Plan. <br /> <br /> <br /> <br />68