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CITY OF HUGO, MINNESOTA <br />NOTES TO FINANCIAL STATEMENTS (CONTINUED) <br />4. Other Information (Continued) <br />C. Pension Plans (Continued) <br />2. Hugo Firefighter's Relief Association <br />A. Plan Description <br />The Hugo Firefighter's Relief Association administers a single -employer defined benefit <br />pension plan (the Plan) available to volunteer firefighters. As of December 31, 2016, the plan <br />covered 32 active firefighters and 7 vested terminated firefighters whose pension benefits are <br />deferred. The plan is established and administered in accordance with Minnesota Statutes, <br />Chapter 424 A. The December 31, 2016 information is the latest reported for this Plan. <br />B. Benefits Provided <br />Volunteer firefighters for the City are members of the Hugo Firefighter's Relief Association. <br />Association members are eligible to receive a lump sum benefit after 20 years of service with <br />a minimum retirement age of 50. Currently retirees receive a benefit of $3,300 for every year <br />of service. These benefit provisions and all other requirements are consistent with State <br />statutes. Volunteers of the fire department are not required to contribute to the relief <br />association. Members with 10 years of service receive partial vesting at 60% of the 20 -year <br />rate and 4% added for every one year of service beyond ten years up to 20 years. <br />C. Contributions <br />The Plan is funded by fire state aid, investment earnings and, if necessary, employer <br />contributions as specified in Minnesota statutes, and voluntary City contributions. The State of <br />Minnesota contributed $83,852 in state aid to the plan on behalf of the Association for the year <br />ended December 31, 2016, which was recorded as revenue. The City levies property taxes <br />for the benefit of the Association and passes through state aids allocated to the plan, all in <br />accordance with State statutes. During 2016, at the Association's direction, the City did not <br />levy any property taxes to be paid to the Association. <br />D. Pension Costs <br />At December 31, 2016, the City reported a net pension asset of $511,851 for the plan. The net <br />pension asset was measured as of December 31, 2016. The total pension liability used to <br />calculate the net pension asset in accordance with GASB 68 was determined by applying an <br />actuarial formula to specific census data certified by the fire department as of December 31, <br />2016. <br />62 <br />