4.2. SR 07-27-1998 - Laserfiche WebLink

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~ity of · lver MEMORANDUM Item #4.2. TO: FROM: DATE: SUBJECT: Mayor & City Council Pat Klaers, City Ad July 27, 1998 Fire Department Relief Association Per Year Benefit Level Retirement Plan There are really two requests with this agenda item. The first request is for the city to release its 1998 Relief Association contribution. The second item is for the City Council to establish the per year benefit level for the Fire Department Retirement Plan. Regarding the city contribution to the Fire Department Relief Association, it should be noted that there is $17,500 in the 1998 fire department budget. However, in late October 1997, the City Council accepted a proposal which showed the contribution level to be $20,150 in 1998. Accordingly, some of this contribution will need to come from the city council contingency fund. It is staffs recommendation the City Council, by motion, approve the release of $20,150 in city funds to the Relief Association. The second issue regarding the per year benefit level is more difficult to address. Identifying the appropriate level is more of an art than a science and the level of benefit for 1999, which is what the Council is being asked to set, is generally based upon projections for returns on investments. Staff agrees with the position of the Relief Association in that a significant surplus in its fund does no one any good, and that they have a certain obligation to pay at the maximum level possible for the benefit of the firefighters. Additionally, staff applauds the recent investment planning of the Relief Association. The Relief Association is asking for an increase in the per year benefit level to $2,970. This is an 11 percent increase from the 1998 level of $2,674. Projections from the department (based on 9 percent this year and 7 percent 13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · TDD & Phone: (612) 441-7420 · Fax: (612) 441-7425