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CITY OF ST. ANTHONY, MINNESOTA <br />NOTES TO FINANCIAL STATEMENTS <br />December 31, 2022 <br /> <br /> <br /> <br /> <br />Salary growth assumptions in the GERF range in annual increments from 10.25% after one year of <br />service to 3.0% after 27 years of service. In the PEPFF, salary growth assumptions range from 11.75% <br />after one year of service to 3.0% after 24 years of service. <br /> <br />Mortality rates for GERF were based on the Pub-2010 General Employee Mortality Table. Mortality <br />rates for PEPFF were based on the Pub-2010 Public Safety Employee Mortality tables. The tables are <br />adjusted slightly to fit PERA’s experience. <br /> <br />Actuarial assumptions for GERF are reviewed every four years. The most recent four-year experience <br />study for GERF was completed in 2019. The assumption changes were adopted by the Board and <br />become effective with the July 1, 2020 actuarial valuation. The most recent four-year experience study <br />for PEPFF was completed in 2020 and adopted by the Board and became effective with the July 1, <br />2021 actuarial valuation. <br /> <br />The following changes in actuarial assumptions and plan provisions occurred in 2022: <br /> <br />General Employees Fund <br />Changes in Actuarial Assumptions: <br /> The mortality improvement scale was changed from Scale MP-2020 to Scale MP-2021. <br /> <br />Police and Fire Fund <br />Changes in Actuarial Assumptions: <br /> The single discount rate was changed from 6.50% to 5.40%. <br /> The mortality improvement scale was changed from MP-2020 to MN-2021. <br /> <br />The State Board of Investment, which manages the investments of PERA, prepares an analysis of the <br />reasonableness on a regular basis of the long-term expected rate of return using a building-block <br />method in which best-estimate ranges of expected future rates of return are developed for each major <br />asset class. These ranges are combined to produce an expected long-term rate of return by weighting <br />the expected future rates of return by the target asset allocation percentages. The target allocation and <br />best estimates of geometric real rates of return for each major asset class are summarized in the <br />following table: <br /> <br />Target Long-Term Expected <br />Asset Class Allocation Real Rate of Return <br />Domestic equity 35.0%5.10% <br />International equity 15.0%5.30% <br />Bonds 45.0%0.75% <br />Unallocated cash 5.0%0.00% <br />Total 100% <br />71