8.2. SR 07-16-2018 - Laserfiche WebLink

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Eclty1� ,.,�� Request for Action River To Item Number Mayor and City Council 8.2 Agenda Section Meeting Date Prepared by General Business July 16, 2018 Lori Ziemer, Finance Director Item Description Reviewed by 2019 Benefit Level for Elk River Fire Relief Cal Portner, City Administrator Association Reviewed by Action Requested Approve,by motion, an increase for the Elk River Fire Relief Association (ERFRA) benefit level to $7,120 per year of service effective January 1, 2019. Background/Discussion Prior to August 1 of each year, the ERFRA is required to certify to the city the required municipal contribution for the following year. A request for an increase in the per year of service pension amount effective January 1 for the next year must also be acted on by the Council before August 1. ERFRA operates under a defined benefit plan. The pension liability is calculated by the number of active service years multiplied by a set benefit level. Members who retire with less than 20 years of service are entitled to a reduced service pension if they have reached the age of 50 years and have completed at least five years of active membership. On June 13, the ERFRA recommended increasing the benefit level to $7,120 from the current benefit level of$6,285, an increase of 13% or $835. The new rate of$7,120 does not require a city contribution for 2019. The relief assets are managed by The Parr McKnight Wealth Management Group and the actual funding ratio was 112% as of 12/31/17. ERFRA projections indicate the funding ratio will remain over 100% even with the increased benefit level. The city representatives that serve as trustees of the ERFRA consist of the fire chief, the mayor, and the finance director. Financial Impact The annual voluntary contribution of$30,000 is planned to be budgeted in 2019 in the Fire Administration budget. Attachments ■ Memo from the Elk River Fire Relief Association The Elk River Vision A PehoMing community 2a itb revolutionary and spirited resourcefulness, exceptional POWERED By service, and community engagement that encourages and inspires prosperity INAMIRE1