HomeMy WebLinkAbout6.d. 2022 Fire Relief Fund Benefit Proposal
EXECUTIVE SUMMARY
City Council Regular Meeting: August 1, 2022
AGENDA ITEM: Fire Relief Fund Benefit Proposal AGENDA SECTION:
Consent
PREPARED BY: Logan Martin, City Administrator
Teah Malecha, Finance Director AGENDA NO. 6.d.
ATTACHMENTS: 2022 Annual Report presentation, Yearly
Benefit Increase Process agreement APPROVED BY: LJM
RECOMMENDED ACTION: Motion authorizing a $400 increase up to $8,600 for the
Rosemount Fire Relief Association’s annual retirement benefit.
BACKGROUND
The Fire Relief Association, which manages the pension funds for our firefighters, has recommended a $400
increase in the retirement benefit from $8,200 to $8,600 per year of service. Representatives from the Relief
Association provided staff with updated financial projections reflecting this proposal, which indicate that
the Relief Fund will be 182 percent funded after accounting for the proposed increase. This funding ratio is
reflective of the positive results of the Relief Association’s investments. As of April 2022, the Fund was 157
percent funded when accounting for this increase and in response to the market downturn of early 2022.
As the Council will recall, the Relief Association worked with the Council in the fall of 2019 to establish a
procedure for adjusting the annual benefit based on the status of their financial investments. The final
agreement agreed to by both parties is attached, and indicates increases to their yearly benefit as follows:
Funding Ratio Increase
Less than 122% $0
<122% - 128% $150
<128% - 136% $275
136% or greater $400
RECOMMENDATION
Staff recommends the City Council approve a motion authorizing a $400 increase up to $8,600 for the
Rosemount Fire Relief Association’s annual retirement benefit, effective June 30, 2022.
Parr McKnight
State Board of Investments
2020
Ending Balance
2021
Ending Balance % Change
$1,598,357.88
$ 3,532,062.92
$1,741,835.15
$4,089,772.72
8.98%
15.79%
Fire State Aid Supplemental State Aid$139,861.53 $29,384.76
# Separated Not Vested
# Separated Added to Deferred
# Separated Benefit Paid
# Deferred Paid
# Added 7
3
1
1
0
Beginning of Year
# Active # Deferred
End of Year
43 2
45 3
Accrued Liabilities
Assets
Funding Ratio
2021 Year End Funding Ratio
$5,885,041
$3,090,077
191%
Plan Funding Ratio Increase
less than 122%$0
122% or greater but less than 128%$150
128% or greater but less than 136%$275
136% or greater $400
Accrued Liabilities
Assets
Funding Ratio
Funding Ratio after Increase
$5,885,041
$3,240,810
182%
Benefit Increase of $400
Parr McKnight
State Board of Investments
2021
Ending Balance
2022
Balance as of 4-30 % Change
$1,741,835.15
$4,089,772.72
$1,445,805.90
$3,647,902.26
17.00%
10.80%
Accrued Liabilities
Assets
Funding Ratio
2021 Funding Ratio with Increase
$5,885,041
$ 3,240,810
182%
Accrued Liabilities
Assets
Funding Ratio
Funding Ratio as of 4-30
$5,093,708
$ 3,240,810
157%