6.3 SR 06-05-2023 - Laserfiche WebLink

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City of Elk River Notes to Basic Financial Statements NOTE 12 — PENSION PLANS (CONTINUED) Public Employees' Retirement Association (Continued) F. Actuarial Methods and Assumptions (Continued) Actuarial assumptions for the General Employees Plan are reviewed every four years. The most recent four-year experience study for the General Employees Plan was completed in 2019. The assumption changes were adopted by the Board and became effective with the July 1, 2020, actuarial valuation. The most recent four-year experience study for the Police and Fire Plan was completed in 2020 and was adopted by the Board and became effective with the July 1, 2021, actuarial valuation. The following changes in actuarial assumptions and plan provisions occurred in 2022: General Employees Fund Changes in Actuarial Assumptions • The mortality improvement scale was changed from scale MP-2020 to scale MP-2021. Changes in Plan Provisions • There have been no changes since the previous valuation. Police and Fire Fund Changes in Actuarial Assumptions • The mortality improvement scale was changed from MP-2020 to MP-2021. • The single discount rate was changed from 6.5% to 5.4%. Changes in Plan Provisions • There have been no changes since the previous valuation. G. Discount Rate The discount rate for the General Employees Plan used to measure the total pension liability in 2022 was 6.5%. The projection of cash flows used to determine the discount rate assumed that contributions from Plan members and employers will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net positions of the General Employees Fund was projected to be available to make all projected future benefit payments of current Plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. FOR