06-14-2021 Council Packet - Laserfiche WebLink

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CITY OF LINO LAKES, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO RSI December 31, 2019 Note A LEGAL COMPLIANCE -BUDGETS The General Fund budget is legally adopted on a basis consistent with accounting principles generally accepted in the United States of America. The legal level of budgetary control is at the department level for the General Fund. Note B OPEB INFORMATION No assets are accumulated in a trust that meets the criteria in paragraph 4 ofGASB Statement No. 75 to pay related benefits. The previous actuarial valuation included a liability for benefits provided to the beneficiary of a deceased employee. As of the most recent actuarial valuation date, the beneficiary was not enrolled in the City's plan, but has been assigned a 20% probability ofretuming to the plan. Note C PENSION INFORMATION PERA -General Employees Retirement Fund 2019 Changes in Actuarial Assumptions: • The mortality projection scale was changed from MP-2017 to MP-2018 2019 Changes in the Plan Provisions: • The employer supplemental contribution was changed prospectively, decreasing from $31.0 million to $21.0 million per year. The State's special funding contribution was changed prospectively, requiring $16.0 million due per year through 2031. 2018 Changes in Actuarial Assumptions: • The mortality projection scale was changed from MP-2015 to MP-2017. • The assumed benefit increase was changed from 1.00"/o per year through 2044 and 2.50% per year thereafter to 1.25% per year. 2017 Changes in Actuarial Assumptions: • The Combined Service Annuity (CSA) loads were changed from 0.8% for active members and 60% for vested and non-vested deferred members. The revised CSA loads are now 0.0% for active member liability, 15.0% for vested deferred member liability and 3.0% for non-vested deferred member liability. • The assumed post-retirement benefit increase rate was changed from 1.0% per year for all years to 1.0% per year through 2044 and 2.5% per year thereafter. 2016 Changes in Actuarial Assumptions: • The assumed post-retirement benefit increase rate was changed from 1.0% per year through 2035 and 2.5% per year thereafter to 1.0% per year for all future years. • The assumed investment retorn was changed from 7 .9% to 7 .5%. The single discount rate was changed from 7 .9% to 7 .5%. CITY OF LINO LAKES, MINNESOTA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO RSI December 31, 2019 • Other assumptions were changed porsuant to the experience stody dated June 30, 2015. The assumed future salary increases, payroll growth, and inflation were decreased by 0.25% to 3.25% for payroll growth and 2.50% for inflation. PERA -Public Employees Police and Fire Fund 2019 Changes in Actuarial Assumptions: • The mortality projection scale was changed from MP-2017 to MP-2018 2018 Changes in Actuarial Assumptions: • The mortality projection scale was changed from MP-2016 to MP-2017. 2017 Changes in Actuarial Assumptions: • The single discount rate was changed from 5.6% to 7.5%. • Assumed salary increases were changed as recommended in the June 30, 2016 experience study. The net effect is proposed rates that average 0.34 percent lower than the previous rates. • Assumed rates of retirement were changed, resulting in fewer retirements. • The Combined Service Annuity (CSA) load was 30 percent for vested and non-vested deferred members. The CSA has been changed to 33 percent for vested members and 2 percent for non- vested members. The base mortality table for healthy annuitants was changed from the RP-2000 fully generational table to the RP-2014 fully generational table (with a base year of2006), with male rates adjusted by a factor of 0.96. The mortality improvement scale was changed from Scale AA to Scale MP- 2016. The base mortality table for disabled annuitants was changed from the RP-2000 disabled mortality table to the mortality tables assumed for healthy retirees. • Assumed termination rates were decreased to 3% for the first three years of service. Rates beyond the select period of three years were adjusted, resulting in more expected terminations overall. • Assumed percentage of married female members was decreased from 65% to 60%. • Assumed age difference was changed from separate assumptions for male members (wives assumed to be three years younger) and female members (husbands assumed to be four years older) to the assumption that males are two years older than females. • The assumed percentage offemale members electing Joint and Survivor annuities was increased. • The assumed post-retirement benefit increase rate was changed from 1.00% for all years to 1.00% per year through 2064 and 2.50% thereafter. 2016 Changes in Actuarial Assumptions: • The assomed post-retirement benefit increase rate was changed from 1.0% per year through 2037 and 2.5% per year thereafter to 1.0% per year for all future years. • The assumed investment retum was changed from 7 .9% to 7 .5%. The single discount rate changed from 7.9% to 5.6%. IV-44