7.1. SR 07-19-2010 - Laserfiche WebLink

Home Browse Search

:ver Fire Department July 19, 2010 To: Mayor and City Council From: Scott Schmitt, President of the Elk River Fire Department (FRED) Relief Association Baclc~ound of the Association The ERFD Relief Association is made up of the active paid-on-call members of the ERFD. The purpose of the association is to provide retirement, disability and death benefits to the members or beneficiaries of members of the department. The pension benefit is also one way to encourage volunteer or paid-on-call members to "stay on the job". The State of Minnesota has provided the major share of funding for the association through distribution of the money collected from a gross earnings tax on fire insurance premiums sold in the state. The funds are allocated to the departments based on the population and property values in the area served by that department. There is a strong relationship between state fire aid and the number of fire-related calls a fire department responds each year. The City has also shown continued support of the Relief Association as exampled by past contributions and the three year commitment of $30,000 commencing in 2008. State law requires that a relief association be governed by arsine-member board of trustees. The ERFD Relief Association is directed by six trustees elected by members of the ERFD, the fire chief, the city Finance Director, and the Mayor. A minimum of four meetings are held each year to oversee the management of the Association's funds. Tie of Pension Plan The members of the Relief Association are covered by a defined benefit plan. The benefit level of the plan is determined by the number of members, their length of service, and the value of the relief fund. Benefit level studies are performed on an annual basis. When a benefit level increase is warranted an approval request is made to the City Council. The year 2011 will be our fourth consecutive year of not having a funding rate that would merit an increase request.