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<br /> <br />Request for Action <br /> <br /> <br />To Item Number <br />Mayor and City Council 8.2 <br />Agenda Section Meeting Date Prepared by <br />General Business July 19, 2021 Lori Ziemer, Finance Director <br />Item Description Reviewed by <br />2022 Benefit Level for Elk River Fire Relief Cal Portner, City Administrator <br />Association <br />Reviewed by <br /> <br />Action Requested <br />Approve, by motion, an increase for the Elk River Fire Relief Association (ERFRA) benefit level to <br />$8,850 per year of service effective January 1, 2022. <br /> <br />Background/Discussion <br />Prior to August 1 of each year, the ERFRA is required to certify to the city the required municipal <br />contribution for the following year. A request for an increase in the Per Year of Service Pension amount <br />effective January 1 for the next year must also be acted on by the Council before August 1. <br /> <br />ERFRA operates under a defined benefit plan. The pension liability is calculated by the number of active <br />service years multiplied by a set benefit level. Members who retire with less than 20 years of service are <br />entitled to a reduced service pension if they have reached the age of 50 years and have completed at least <br />five years of active membership. <br /> <br />On June 9, the ERFRA recommended increasing the benefit level to $8,850 from the current benefit level <br />of $7,120 approved in 2018, an increase of $1,730 or 24%. The new benefit level of $8,850 is not <br />expected to require a city contribution for 2022. <br /> <br />The relief assets are managed by The Parr McKnight Wealth Management Group and projections indicate <br />the funding ratio will remain over 100% even with the increased benefit level. <br /> <br />The city representatives that serve as trustees of the ERFRA consist of the fire chief, the mayor, and the <br />finance director. <br /> <br />Financial Impact <br />The annual voluntary contribution of $30,000 is planned to be budgeted in the 2022 Fire budget. <br /> <br />Mission/Policy/Goal <br />N/A <br /> <br />Attachments <br /> Memo from the Elk River Fire Relief Association <br /> <br />The Elk River Vision <br />A welcoming community with revolutionary and spirited resourcefulness, exceptional <br />service, and community engagement that encourages and inspires prosperity <br />