Laserfiche WebLink
<br /> <br />Request for Action <br /> <br /> <br />To Item Number <br />Mayor and City Council 8.1 <br />Agenda Section Meeting Date Prepared by <br />General Business July 5, 2022 Lori Ziemer, Finance Director <br />Item Description Reviewed by <br />2023 Benefit Level for Elk River Fire Relief Cal Portner, City Administrator <br />Association <br />Reviewed by <br /> <br /> <br />Action Requested <br />Approve, by motion, the request by the Elk River Fire Relief Association (ERFRA) to increase the <br />pension benefit level to $9,685 per year of service effective January 1, 2023. <br /> <br />Background/Discussion <br />Prior to August 1 of each year, the ERFRA is required to certify to the city the required municipal contribution <br />for the following year. A request for an increase in the Per Year of Service Pension amount effective January 1 <br />for the next year must also be acted on by the Council before August 1. <br /> <br />ERFRA is a defined benefit plan. The pension liability is calculated by the number of active service years <br />multiplied by a set benefit level. Members who retire with less than 20 years of service are entitled to a reduced <br />service pension if they have reached the age of 50 and have completed at least five years of active membership. <br /> <br />On June 8, the ERFRA recommended increasing the benefit level to $9,685 from the current benefit level of <br />$8,850 approved in 2021, an increase of $835 or 9.4%. <br /> <br />The fire relief assets are managed by Parr McKnight Wealth Management Group. Based on their projection <br />investment markets will recover by the end of the year, it is anticipated the funding ratio will remain 100% with <br />the increased benefit level and is not expected to require a city contribution in 2023. However, as of June 29, <br />2022, the fire relief investment assets were down $590,000, or 13.8%, year to date. <br /> <br />The fire chief, mayor, and finance director serve as trustees of the ERFRA. A member of the Elk River Fire <br />Relief Board will be presenting their request to increase the pension benefit level to $9,685. <br /> <br />Financial Impact <br />The annual voluntary contribution of $30,000 is planned to be budgeted in the 2023 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 />