Pension Board Minutes 5.14.19 - Laserfiche WebLink

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starting to move towards a more direct five or three year smoothing period rather than just 20%. decision came about to go with that method. It was a pretty standard thing to have about five years ago but it should probably be updated soon. The plan liabilities have been smooth. Went up from $34,634,468 in 2018 to $35,321.682 in 2019. Unfunded accrued liability jumped from $6,560.560 to $8,230,922 because of the asset loss. Actuarial Value Funded Ratio went from 81.1% to 76.7%. The required contributed went from $1,275,970 in 2018 to $1,452,047 in 2019 (17.2% vs 19.2% of payroll). The normal contribution cost is made up of member and employer piece and for 2019 is $630,093. The 15-yr amortization of unfunded accrued liability is $821,954. It works like a mortgage payment but - because every year it gets re-amortized. Member McCarthy asked if the recommendation would be to go to ten or twelve years amortization period. Mr. Ribble said as a first step he would recommend closing the amortization period but there are budget implications. Another option is to close the amortization period and setup a layered amortization. Mr. Ribble summarized the Non-Uniformed valuation results stating that the Market Value is $21,269,878 down from $23,255,101 and the actuarial value is $23,275,646 up from $22,695,073. There was a loss with a market return of 6.1% vs the 6.5% of long-term return. Actuarial Accrued Liability increased to $5,585,988 from $4,897,286. The funded ratio decreased to 80.6% from 82.3%. The required contributed went from $876,694 in 2018 to $945,390 in 2019 (13.58% vs 13.86% of payroll). The normal cost contribution is $387,564 and 15 year amortization of UAL is $557,826. Mr. Ribble suggested reviewing assumptions every 3-5 years (last review was in 2015); consider which version of the new public mortality table to adopt as of January 1, 2020; consider closing the 15 year amortization period; review the Actuarial Value of Asset (AVA) Methodology and consider moving to a traditional smoothing method, which recognizes asset gains and losses over a shorter period of timethree years. City Manager Rose asked Mr. Ribble how he would describe the condition of the retirement plans. Mr. Ribble stated they are not untypical and fairly standard but there are concerns about slippery slope and should be watched carefully and tightened up. Chairman Reedy commented that everyone should be mindful that the police and fire dropped to 76.7% from 81.1% funded ratio. Member Stutz mentioned that the $3 million refund to the City from July 2018 likely impacted these numbers. Ќ