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CITY OF LINO LAKES, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2012 52 Note 6 DEFINED BENEFIT PENSIO N PLANS – STATEWIDE (CONTINUED) B. FUNDING POLICY Minnesota Statutes, Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes. GERF Basic Plan members and Coordinated Plan members are required to contribute 9.10% a nd 6.25% respectively, of their a nnual covered salary. PEPFF members were required to contribute 9.6% of their annual covered salary in 2012. The City is required to contribute the following percentages of annual covered payr oll: 11.78% for Basic Plan members, 7.25% for Coordinated Plan members, and 14.4% for PEPFF memb ers. The City's contributions to the General Employees Retirement Fund for the years ende d December 31, 2012, 2011, and 2010 were $164,317, $187,186, and $177,081, respectively. The City’s contributions to the Public Employees Police & Fire Fund for the years ended December 31, 2012, 2011, and 2010 were $315,541, $285,356, and $280,046, respectively. The City’s contributions were equal to the contractually required contributi ons for each year as set by state statute. Note 7 METROPOLITAN COUNCIL ENVIRONMENTAL SERVICES During 1971, the Metropolitan Waste Cont rol Commission (MWCC) was organized to provide for consolidation of the sanitary sewer collection, treatme nt and disposal in the seven count y metropolitan area surrounding Minneapolis and St. Paul. Previously, these operations were maintained by the city governments on an individual or collective basis. The MWCC merged with th e Metropolitan Council during 1994 to fo rm Metropolitan Council Wastewater Services (MCWS) and is now called the Metropolitan C ouncil Environmental Services (MCES). The MCES bills the City annually based upon estimated volume and budgeted costs. The City follows the accounting policy of recognizing these charges as an expense of the sewer u tility operation in the year fo r which they are billed. Note 8 STEWARDSHIP COMP LIANCE AND ACCOUNTABILITY A. Deficit Fund Balances The City has deficit fund balances at December 31, 2012 as follows: Fund Balance Deficit Dedicated Parks(495,592)$ Tax Increment Financing 1-11(763,593) G.O. Improvement Bonds 2005A (2,003,261) Improvement Bonds of 2012A(282) The City intends to fund these deficits through future tax levies, special assessment levies, tax increments, transfers from other funds, and various other sources.