|
City of Orono, Minnesota
<br />Required Supplementary Information (Continued)
<br />For the Year Ended December 31, 2019
<br />Notes to the Required Supplementary Information - General Employees Fund
<br />Changes in Actuarial Assumptions
<br />2019 - The mortality projection was changed from MP-2017 to MP-2018
<br />2018 - The mortality projection scale was changed from MP-2015 to MP-2017. The assumed benefit increase was
<br />changed from 1.00 percent per year through 2044 and 2.50 percent per year thereafter to 1.25 percent per year.
<br />2017 - The Combined Service Annuity (CSA) loads were changed from 0.8 percent for active members and 60 percent for
<br />vested and non-vested deferred members. The revised CSA loads are now 0.0 percent for active member liability, 15.0
<br />percent for vested deferred member liability and 3.0 percent for non-vested deferred member liability. The assumed post-
<br />retirement benefit increase rate was changed from 1.0 percent per year for all years to 1.0 percent per year through 2044
<br />and 2.5 percent per year thereafter.
<br />2016 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2035 and 2.5
<br />percent per year thereafter to 1.0 percent per year for all future years. The assumed investment return was changed from
<br />7.9 percent to 7.5 percent. The single discount rate was changed from 7.9 percent to 7.5 percent. Other assumptions
<br />were changed pursuant to the experience study dated June 30, 2015. The assumed future salary increases, payroll
<br />growth and inflation were decreased by 0.25 percent to 3.25 percent for payroll growth and 2.50 percent for inflation.
<br />2015 - The assumed post-retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5
<br />percent per year thereafter to 1.0 percent per year through 2035 and 2.5 percent per year thereafter.
<br />Changes in Plan Provisions
<br />2019 - The employer supplemental contribution was changed prospectively, decreasing from $31.0 million to $21.0 million
<br />per year. The state’s special funding contribution was changed prospectively, requiring $16.0 million due per year through
<br />2031.
<br />2018 - The augmentation adjustment in early retirement factors is eliminated over a five-year period starting July 1, 2019,
<br />resulting in actuarial equivalence after June 30, 2024. Interest credited on member contributions decreased from 4.00
<br />percent to 3.00 percent, beginning July 1, 2018. Deferred augmentation was changed to 0.00 percent, effective
<br />January 1, 2019. Augmentation that has already accrued for deferred members will still apply. Contribution stabilizer
<br />provisions were repealed. Postretirement benefit increases were changed from 1.00 percent per year with a provision to
<br />increase to 2.50 percent upon attainment of 90.00 percent funding ratio to 50.00 percent of the Social Security Cost of
<br />Living Adjustment, not less than 1.00 percent and not more than 1.50 percent, beginning January 1, 2019. For retirements
<br />on or after January 1, 2024, the first benefit increase is delayed until the retiree reaches normal retirement age; does not
<br />apply to Rule of 90 retirees, disability benefit recipients, or survivors. Actuarial equivalent factors were updated to reflect
<br />revised mortality and interest assumptions.
<br />2017 - The State’s contribution for the Minneapolis Employees Retirement Fund equals $16,000,000 in 2017 and 2018,
<br />and $6,000,000 thereafter. The Employer Supplemental Contribution for the Minneapolis Employees Retirement Fund
<br />changed from $21,000,000 to $31,000,000 in calendar years 2019 to 2031. The state’s contribution changed from
<br />$16,000,000 to $6,000,000 in calendar years 2019 to 2031.
<br />2015 - On January 1, 2015, the Minneapolis Employees Retirement Fund was merged into the General Employees Fund,
<br />which increased the total pension liability by $1.1 billion and increased the fiduciary plan net position by $892 million.
<br />Upon consolidation, state and employer contributions were revised.
<br />retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5 retirement benefit increase rate was changed from 1.0 percent per year through 2030 and 2.5
<br />percent per year thereafter to 1.0 percent per year through 2035percent per year thereafter to 1.0 percent per year through 2035 and 2.5 percent per year thereafter.and 2.5 percent per year thereafter.
<br />sionssions
<br />The employer supplemental contribution was changed prospectively, decreasing from $31.0 million to $21.0 million The employer supplemental contribution was changed prospectively, decreasing from $31.0 million to $21.0 million
<br />per year. The state’s special funding contribution was changed prospectively, requiring $16.0 million due per year through per year. The state’s special funding contribution was changed prospectively, requiring $16.0 million due per year through
<br />The augmentation adjustment in early retirement factors is eliminated over a fiveThe augmentation adjustment in early retirement factors is eliminated over a five-year period starting July 1, 2019, year period starting July 1, 2019,
<br />resulting in actuarial equivalence after June 30, 2024. Interest crediresulting in actuarial equivalence after June 30, 2024. Interest credited on member contributions decreased from 4.00 ted on member contributions decreased from 4.00
<br />89
|