06-27-2016 Council Packet - Laserfiche WebLink

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CITY OF ORONO NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2015 (50) NOTE 8 DEFINED BENEFIT PENSION PLANS – STATE-WIDE (CONTINUED) D. Pension Costs (Continued) 2. PEPFF Pension Costs At December 31, 2015, the City reported a liability of $2,624,701 for its proportionate share of the PEPFF’s net pension liability. The net pension liability was measured as of June 30, 2015, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City’s proportion of the net pension liability was based on the City’s contributions received by PERA during the measurement period for employer payroll paid dates from July 1, 2014, through June 30, 2015, relative to the total employer contributions received from all of PERA’s participating employers. At June 30, 2015, the City’s proportion was .231%. For the year ended December 31, 2015, the City recognized pension expense of $434,297 for its proportionate share of the PEPFF’s pension expense. The City also recognized $20,790 for the year ended December 31, 2015, as pension expense (and grant revenue) for its proportionate share of the State of Minnesota’s on-behalf contributions to the PEPFF. Legislation passed in 2013 required the State of Minnesota to begin contributing $9 million to the PEPFF each year, starting in fiscal year 2014. At December 31, 2015, the City reported its proportionate share of the PEPFF’s deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Description Deferred Outflows of Resources Deferred Inflows of Resources Differences Between Expected and Actual Economic Experience -$ 425,641$ Changes in Actuarial Assumptions - - Net Difference Between Projected and Actual Earnings on Pension Plan Investments 457,311 - Changes in Proportion and Differences Between City Contributions and Proportionate Share of Contributions - 90,003 City Contributions Subsequent to the Measurement Date 174,573 - Total 631,884$ 515,644$ A total of $174,573 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended December 31, 2016. Other amounts reported as deferred outflows and inflows of resources related to pensions will be recognized in pension expense as follows: Year Ended December 30 Pension Expenses Amount 2016 11,199$ 2017 11,199 2018 11,199 2019 11,199 2020 (103,129) Thereafter -