5.2. SR 06-06-2011 - Laserfiche WebLink

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CITY OF ELK RIVER, MINNESOTA NOTES TO FINANCIAL STATEMENTS ' DECEMBER 31, 2010 Note 4: OTHER INFORMATION -CONTINUED ' There are different types of annuities available to members upon retirement. A single-life annuity is a lifetime annuity that ceases upon the death of the retiree-no survivor annuity is payable. There are also various types ' of joint and survivor annuity options available which will be payable over joint lives. Members may also leave their contributions in the fund upon termination of public ser~rice in order to qualify for a deferred annuity at retirement age. Refunds of contributions are available at any time to members who ' leave public service, but before retirement benefits begin. The benefit provisions stated in the previous paragraphs of this section are current provisions and apply to ' active plan participants. Vested, terminated employees who are entitled to benefits but are not receiving them yet are bound by the provisions in effect at the time they last terminated their public service. PERA issues a publicly available financial report that includes financial statements and required supplementary ' information for GERF and PEPFF. That report maybe obtained on the Internet at www.mnpera.or~, by writing to PERA, at 60 Empire Drive #200, St. Paul, Minnesota, 55103-2088 or by calling (651) 296-7460 or 1-800- 652-9026. b. Funding Policy ' Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are ' established and amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes. GERF Basic Plan members and Coordinated Plan members are required to contribute 9.1% and 6.0%, respectively, of their annual covered salary in 2010. PEPFF members ' were required to contribute 9.4% of their annual covered salary in 2010. In 2010, the City of Elk River is required to contribute the following percentages of annual covered payroll: 11.78% for Basic Plan members, 7% for Coordinated Plan members, and 14.1% for PEPFF members. Employer contribution rates for the Coordinated Plan will increase to 7.0%, effective January 1, 2010. The Ciry's contributions to the Public ' Employees Retirement Fund for the years ending December 31, 2010, 2009, and 2008 were 501,726, $496,994, and $496,832, respectively. The City's contributions to the Public Employees Police & Fire Fund for the years ending December 31, 2010, 2009, and 2008 were $357,977, $340,677, and $317,807, respectively. The City's ' contributions were equal to the contractually required contributions for each year as set by state statute. c. Defined Contribution Plan Three council members of the City of Elk River are covered by the Public Employees Defined Contribution ' Plan (PEDCP), amultiple-employer deferred compensation plan administered by the Public Employees Retirement Association of Minnesota (PERA). The PEDCP is a tax qualified plan under Section 401(a) of the ' Internal Revenue Code and all contributions by or on behalf of employees are tax deferred until time of withdrawal. Plan benefits depend solely on amounts contributed to the plan plus investment earnings, less administrative , expenses. Minnesota Statutes, Chapter 353D.03, specifies plan provisions, including the employee and employer contribution rates for those qualified personnel who elect to participate. An eligible elected official who decides to participate contributes 5 percent of salary which is matched by the elected official's employer. ' For salaried employees, employer contributions are determined by the employer and must be a fixed percentage of salary. Employees who are paid for their services may elect to make member contributions in an amount not to exceed the employer share. Employer and employee contributions are combined and used to purchase shares in one or more of the seven accounts of the Minnesota Supplemental Investment Fund. For administering the ' plan, PERA receives 2 percent of employer contributions and twenty-five hundredths of one percent of the assets in each member's account annually. 58 '