Annual Financial Report 12/31/1985

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CITY OF LINO LAKES, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 1985 Note 2 - DETAIL NOTES ON ALL FUND AND ACCOUNT GROUPS (Continued) RETIREMENT (Continued) A summary of plan eligibility requirements is available at PERA. Such retire- ment terms are governed by State Statute. Retirees have a variety of annuity options available for payment of benefits. The amounts of annuity (retirement benefits) are based on the following formulas: BASIC MEMBERS - 2% of the average salary over the highest five successive years on which deductions were paid for each of the first 10 years and 2 -1/2% of said "average salary" for the period thereafter. COORDINATED MEMBERS - 1% of the average salary over the highest five suc- cessive years on which deductions were paid for each of the first 10 years and 1 -1/2% of said average salary for the period thereafter. POLICE AND FIRE MEMBERS - 2 -1/2% of the average salary over the highest five successive years on which deductions were paid for each of the first 25 years and 2% of said average salary for the period thereafter. PERA also provides death and disability benefits. Pension benefits are funded from member and employee contributions and income from investment of fund assets. Public Employees Retirement Fund members belong to either the Basic or Coordinated Plan. Coordinated members are covered by Social Security and Basic members are not. All new members of the Public Employees Retirement Fund must participate in the Coordinated Plan. Current contribution rates for the funds are as follows: Additional Employee Employer Employer Public Employees Retirement Fund: Basic Plan 8% 8% 2 -1/2% Coordinated Plan 4% 4% 1/4% Public Employees Police and Fire Fund 8% 12% Upon termination, regardless of years of service, if not rehired in a PERA- covered position, all salary deductions will be refunded, with interest at 5% compounded annually.