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City of Orono, Minnesota <br />Notes to the Financial Statements <br />December 31, 2023 <br />Note 4:Defined Benefit Pension Plans - Statewide (Continued) <br />Deferred Deferred <br />Outflows Inflows <br />of Resources of Resources <br />Differences Between Expected and Actual Economic Experience 1,046,427$ -$ <br />Changes in Actuarial Assumptions 4,409,989 5,331,900 <br />Net Difference Between Projected and Actual Investment Earnings - 102,474 <br />Changes in Proportion 62,434 173,987 <br />Contributions Paid to PERA Subsequent to the Measurement Date 275,895 - <br />Total 5,794,745$ 5,608,361$ <br />174,523$ <br />27,914 <br />916,070 <br />(267,149) <br />(940,869) <br />E. Long-term Expected Return on Investment <br />Domestic Equity 33.5 %5.10 % <br />International Equity 16.5 5.30 <br />Fixed Income 25.0 0.75 <br />Private Markets 25.0 5.90 <br />Total 100.0 % <br />Asset Class Allocation Rate of Return <br />resources and deferred inflows of resources from the following sources: <br />subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended <br />December 31, 2024. Other amounts reported as deferred outflows and inflows of resources related to pensions will be <br />recognized in pension expense as follows: <br />2024 <br />2025 <br />2026 <br />2027 <br />2028 <br />The State Board of Investment, which manages the investments of PERA, prepares an analysis of the reasonableness on <br />a regular basis of the long-term expected rate of return using a building-block method in which best-estimate ranges of <br />expected future rates of return are developed for each major asset class. These ranges are combined to produce an <br />expected long-term rate of return by weighting the expected future rates of return by the target asset allocation <br />percentages. The target allocation and best estimates of geometric real rates of return for each major asset class are <br />summarized in the following table: <br />Long-term <br />Target Expected Real <br />75 <br />174,523$ $ <br />27,914 <br />916,070 <br />(267,149) <br />(940,869) <br />E. Long-term Expected Return on InvestmentE. Long-term Expected Return on Investment <br />recognized in pension expense as follows:recognized in pension expense as follows: <br />110