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1 <br />1 <br />1 <br />COUNCIL WORK SESSION MARCH 11, 1991 <br />A work session of the Lino Lakes City Council was called to order <br />by Mayor Bisel at 5:30 P.M., Monday, March 11, 1991. Council <br />Members present: Neal, Kuether, Bisel, Reinert, Bohjanen. <br />Council Members absent: none. City Accountant, Paula Schloer; <br />Administrator, Randy Schumacher and Clerk- Treasurer Marilyn <br />Anderson were also present. <br />The purpose of the work session was to discuss elected officials <br />retirement plan alternatives and in particular the Defined <br />Contribution Plan. John Paulson from PERA was present to outline <br />the plan for the Council and to answer questions. <br />Mr. Paulson gave a brief background on how and why the <br />legislature decided to offer this particular plan to elected <br />officials. Mr. Paulson noted that if Council Members decide not <br />to enroll in the elected officials PERA plan, social security <br />will be deducted from their salaries beginning July 1, 1991. The <br />Defined Contribution Plan is administered by PERA and is a <br />retirement program for elected officials and public ambulance <br />service personnel where participants determine how employee and <br />employer contributions are to be invested through the purchase of <br />shares in accounts of the Minnesota Supplemental Investment Fund. <br />Total contributions plus investment performance determine the <br />ultimate benefit, which is paid as a lump sum upon withdrawal. <br />The rate of contribution to this plan is five (5%) per cent for <br />the elected official and this amount will be matched by the <br />employer. <br />Mr. Paulson handed out several booklets to the Council Members. <br />He outlined the Defined Contribution Plan and noted that it is <br />actually a deferred tax plan. He noted that elected officials <br />may make contributions to the plan for past uncovered elective <br />service. In this case the employer will match these <br />contributions according to the rate that was in effect at the <br />time the public official was in office. <br />Mr. Paulson explained that if a public official decides to enroll <br />in the Defined Contribution Plan, the public official can <br />determine how he wants his contributions to be invested. He also <br />explained that the contributions to this plan must remain in the <br />fund until the participant is no longer in elective office, is <br />disabled or dies. At either of these events, the total amount is <br />withdrawn in a lump fund. <br />Mr. Paulson explained the form that must be completed by the <br />elected official if he /she wishes to make contributions to the <br />plan for past uncovered elective service. He noted that in some <br />cases it may take several years to purchase back uncovered <br />PAGE 1 <br />a1 <br />