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CITY OF LINO LAKES, MINNESOTA
<br />NOTES TO FINANCIAL STATEMENTS
<br />December 31, 1999
<br />Note 5 LEGAL DEBT MARGIN
<br />The City is subject to a statutory limitation by the State of Minnesota for bonded indebtedness payable
<br />principally from property taxes. The City of Lino Lake's legal debt margin for 1999 and 1998 is computed as
<br />follows:
<br />Market value
<br />Applicable percentage
<br />Debt Limit
<br />Amount of debt applicable to debt limit:
<br />Total bonded debt
<br />Less: Special assessment bonds
<br />Public project revenue bonds
<br />Cash and investment in Debt Service Funds
<br />Revenue bonds
<br />Total debt applicable to debt limit
<br />Legal debt margin
<br />December 31,
<br />1999 1998
<br />687,737,400 627,423,800
<br />2 % 2 %
<br />13,754,748 12,548,476
<br />25,499,570
<br />(14,045,000)
<br />(6,330,000)
<br />(29,726)
<br />(4,550,000)
<br />544,844
<br />13,209,904
<br />Note 6 DEFINED BENEFIT PENSION PLANS - STATEWIDE
<br />A. PLAN DESCRIPTION
<br />24,152,734
<br />(13,215,000)
<br />(6,350,000)
<br />(8,893)
<br />(4,075,000)
<br />503,841
<br />12,044,635
<br />All full -time and certain part-time employees of the City of Lino Lakes are covered by defined benefit
<br />plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA
<br />administers the Public Employees Retirement Fund (PERF) and the Public Employees Police and Fire
<br />Fund (PEPFF) which are cost - sharing, multiple - employer retirement plans. These plans are
<br />established and administered in accordance with Minnesota Statute, Chapters 353 and 356.
<br />PERF members belong to either the Coordinated Plan or the Basic Plan. Coordinated Plan members
<br />are covered by Social Security and Basic Plan members are not. All new members must participate
<br />in the Coordinated Plan. All police officers, firefighters and peace officers who qualify for
<br />membership by statute are covered by the PEPFF.
<br />PERA provides retirement benefits as well as disability benefits to members, and benefits to survivors
<br />upon death of eligible members. Benefits are established by State Statute, and vest after three years of
<br />credited service. The defined retirement benefits are based on a member's highest average salary for
<br />any five successive years of allowable service, age, and years of credit at termination of service.
<br />Two methods are used to compute benefits for PERF's Coordinated and Basic Plan members. The
<br />retiring member receives the higher of a step -rate benefit accrual formula (Method 1) or a level
<br />accrual formula (Method 2). Under Method 1, the annuity accrual rate for a Basic Plan member who
<br />retired before July 1, 1997 is 2 percent of average salary for each of the first 10 years of services and
<br />2.5 percent for each remaining year. The annuity accrual rate for Basic members who retire on or
<br />after July 1, 1997 is 2.2 percent of average salary for each of the first 10 years and 2.7 percent for
<br />each remaining year. For a Coordinated Plan member who retired before July 1, 1997, the annuity
<br />accrual rate is 1 percent of average salary for each of the first 10 years and 1.5 percent for each
<br />remaining year. For Coordinated members who retire on or after July 1, 1997, the annuity accrual
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