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. 1 1 CITY OF ST. ANTHONY NOTES TO FINANCIAL STATEMENTS DECEMBER 31 , 1999 Note 12. Defined Benefit Pension Plan - Firefighters Relief Association ' The St. Anthony Firefighters Relief Association is the administrator of a single employer retirement system established to provide pension and other benefits to its membership in accordance with Minnesota Statutes. The Association maintains a sepa- 1 rate Special Fund to accumulate assets to fund retirement benefits earned by its members. Funding of the Association is derived primarily from an insurance premium tax in accordance with the Volunteer Firefighter's Relief Association Financing Guidelines Act of 1971 (Chapter 261 as amended by Chapter 509 of Minnesota Statutes). The financial requirements of the Special Fund are determined in accordance with Section 69.772 of the Minnesota Statutes, which requires -the payment of pension bene- fits in a lump sum or optionally in annual installments. Benefits are payable after age 50 with 20 years of service and 10 years of membership, or upon death. Benefits are accumulated at-$1 ,000 per year of active service in the fire department. The accrued liability for these accumulated benefits is computed using increasing per- centages based on years of service. At 20 years of service, the liability is equal to the number of years of service times benefits per year. Association members are ' fully vested after 10 years. The City contributed $6,000 to the Association in 1999. ' As of December 31 , 1998, assets of the Special Fund totaled approximately $538,000 (market value of investments and other assets) and the liability for pension bene- fits was estimated at $396,000. Information for 1999 was not available. 1 Note 13. Deferred Compensation Plans ' The City offers its employees deferred compensation plans created in accordance with Internal Revenue Code Section 457. The plans, available to all City employees, per- mit them to defer a portion of their salary until future years. Participation in ' the plans is optional . Prior to 1998, the deferred compensation was not available to employees until termi- nation, retirement, death or unforeseeable emergency. All amounts of compensation deferred under the plans, were solely the property of the City subject to the claims of the City's general creditors. Participant's rights under the plans were equal ' to "those of general creditors of the City in an amount equal to the value of the deferred account for each. participant. In 1998, the City implemented GASB Statement No. 32, Accounting and Financial ' Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans. As a result of legislation passed, the assets of City deferred compensation plans, as administered by third parties, are now held in trust for the exclusive benefit of ' participants and their beneficiaries. Consequently, assets and liabilities asso- ciated with these plans no longer need to be reported in the financial statements of the City. -31-