8.1. SR 07-20-2009 - Laserfiche WebLink

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,L~11S, \~,,,~'~..- R.iver Fire Department July 20, 2009 To: Mayor and City Council From: Scott Schmitt, President of the Elk River Fire Department (FRED) Relief Association Back~ound of the Association The ERFD Relief Association is made up of the active paid-on-call members of the ERFD. The purpose of the association is to provide retirement, disability and death benefits to the members or beneficiaries of members of the department. The pension benefit is also one way to encourage volunteer orpaid-on-call members to "stay on the job". The State of Minnesota has provided the major share of funding for the association through distribution of the money collected from a gross earnings tax on fire insurance premiums sold in the state. The funds are allocated to the departments based on the population and property values in the area served by that department. There is a strong relationship between state fire aid and the number of fire-related calls a fire department responds each year. The City has also shown continued support of the Relief Association as exampled bypast contributions and the three year commitment of $30,000 commencing in 2008. State law requires that a relief association be governed by arsine-member board of trustees. The ERFD Relief Association is directed by six trustees elected by members of the ERFD, the fire chief, the city Finance Director, and the Mayor. A minimum of four meetings are held each year to oversee the management of the Association's funds. Twe of Pension Plan The members of the Relief Association are covered by a defined benefit plan. The yearly benefit level of the plan is determined bythe number of members, their length of service, and the value of the relief fund. Benefit level studies are performed on an annual basis and presented to members of the Association and the City Council for their approval, and then submitted to the State Auditor.