7.5. SR 06-27-1994
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E ~ River
ITEM 7.5.
MEMORANDUM
FROM:
MAYOR & CITY COUNCIL
LORI JOHNSON, FINANCE DIRECTOR ~
JUNE 23, 1994
TO:
DATE:
SUBJECT: FIRE RELIEF ASSOCIATION BENEFIT
INCREASE REQUEST
At the May 31 City Council meeting, Randy Sykes, Treasurer of the Elk
River Fire Relief Association, presented the Council with preliminary
schedules for the 1995 benefit level for the Relief Association. The present
benefit is $2200 per year of service and the preliminary schedules requested
an increase to $2400 per year of service.
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The Fire Relief Association has revised its request and is asking for approval
of a $2350 per year benefit. This benefit calculation assumes that the City
Council will make a contribution of $19,000 to the Relief Association in 1994.
The benefit level does not require a City contribution in 1995.
Randy Sykes will be at the Council meeting to provide additional information
on this item. Because the schedules need to be submitted to the state by
August 1, 1994, the Relief Association is asking for Council action on the
schedules as well as the 1994 contribution to the Relief Association. The
1994 contingency budget includes funds for this expenditure. If the City
Council authorizes a contribution at a level other than $19,000, schedules 1
and 2 would need to be recalculated and resubmitted to the Council for
approval.
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Finally, the Fire Compensation Task Force has been working on reviewing
the total firefighter compensation package. This review includes the
possibility from changing to a defined benefit pension plan to a defined
contribution pension plan. At this time, it is anticipated that this change
would take place on January 1, 1995. If that changes does occur, schedules 1
and 2 would no longer be relevant as the payment to a retiring firefighter
would be based on the firefighter's percentage of the total available in the
pension fund versus an amount per year of service. The Task Force is
continuing to work on this item and will provide updates to the Council as
progress is made.
P.O. Box 490 · 13065 Orono Parkway · Elk River, MN 55330 · (612) 441-7420 · Fax: (612) 441-7425
e RECOMMENDATION
The Council is asked to take action on two items:
1. The 1994 contribution to the Elk River Relief Association.
2. Approval of the 1995 per year benefit level.
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ELK RIVER
FIREFIGHTERS' RELIEF ASSOCIATION
e Report of financial condition to end of 1994
and requirements for 1995
SCHEDULE I
CALCULATION OF SPECIAL FUND LIABILITY FOR ALL MEMBERS AT
PENSION LEVEL OF $2,350 PER YEAR OF ACTIVE SERVICE
ENTRY TO END OF 1994 TO END OF 1995
NO NAME DATE YRS LIAB YRS LIAB
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1 L MORRELL Jul-65 29 68 150 30 70,500
2 M DREISSIG Jun-66 29 68:150 30 70,500
3 J NYSTROM Dee-67 27 63 , 450 28 65,800
4 B McCARTNEY Jun-68 27 63 450 28 65 800
5 J KREUSER ~-73 22 51;700 23 54;050
6 C OSCARSON r-75 20 47,000 21 49,350
7 R DREISSIG Sep-76 18 39,903 19 43,334
8 R MORRELL Apr-78 17 36 660 18 39 903
9 S DITBRENNER Sep-78 16 33;558 17 36;660
10 J DEIIN Nov-78 16 33,558 17 36 660
11 R BARSODY May-80 15 30,644 16 33;558
12 M TRUNNEL Nov-80 14 27 824 15 30 644
13 R SYKES Feb-81 14 27;824 15 30: 644
14 J FOLLMER Oct-81 13 25,145 14 27 824
15 D KREUSER May-82 13 25,145 14 27;824
16 C ANDERSON Aug-83 11 20,163 12 22,607
17 D PLUDE Aug-83 11 20,163 12 22,607
18 D ANDERSON Jan-85 10 17 860 11 20,163
19 B PEARSON Jan-85 10 17;860 11 20,163
20 R ADERMAN Jan-85 10 17 860 11 20,163
21 G ANDERSON Jun-88 7 11 ; 562 8 13,536
22 P COLLINS Jun-88 7 11 562 8 13,536
e 23 J SMITH Jun-88 7 11;562 8 13,536
24 B BORNTRAGER Sep-89 5 7,849 6 9,635
25 M CREPEAU Sep-89 5 7,849 6 9,635
26 C SKOGSTAD Sep-89 5 7,849 6 9,635
27 D SMITH Sep-89 5 7 .849 6 9,635
28 T DILLON Aug-92 2 2:914 3 4 465
29 T ELLIOT Aug-92 2 2,914 3 4;465
30 R POCHMAN Aug-92 2 2,914 3 4,465
31 S GREENE Aug-92 2 2,914 3 4, 465
32 S OLSON Aug-92 2 2,914 3 4, 465
33
34
35
36
37
38
39
40
41
42 DEF
43
44
45
46 E.V.
47 P LeF 10/81-10/93 . 68X2100X12 17,136 17,136
48
49
50
ACCRUED LIAB FOR ACTIVE MEMBERS 816,719 890,227
ACCRUED L lAB FOR DEFERRED MEMBERS 0 0
ACCRUED LIAB FOR EARLY VESTED MaRS 17,136 17,136
ACCRUED LlAB FOR UNPD INSTALLMENTS
e A~ ACCRUED LIABILITY THROUGH 1995 907,363
B ACCRUED LIABILITY THROUGH 1994 833,855 833,855
C L.A - L.B; NORMAL COST FOR 1995 73,508
SCHEDULE II
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Section 1. PROJECTION OF SPECIAL FUND ASSETS TO DECEMBER 31, 1994
ASSETS AT JANUARY 1, 1994 (12/31/93)------- 1. $ 785,696
EXPECTED INCOME TO DECEMBER 31, 1994
A Minn. State Aid $ 38,514
B City Contribution 19,000
C Fundraisers, etc. 0
D Interest, Inv. Income 43,213
E Realized Gains (losses) 0
F Unrealized " (losses) 0
G Other income 0
TOTAL OF LINES A THROUGH G-----------------
BEGINNING ASSETS PLUS EXPECTED INCOME------
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EXPECTED EXPENSE TO DECEMBER 31.1. 1994
H~ Pens ions :ti 81,400
I Other benefits 1,000
J Administrative 1,700
TOTAL OF LINES H- I -J-----------------
PROJECTED ASSETS AT 12/31/94 (L.3 - L.4)
2. $
3. $
100 ,727
-----
886, 423
4. $
5. $
84,100
---------
802, 323
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Section 2. Determination of projected SURPLUS
Projected Assets (Line 5)
Accrued Liability (Line B, Schedule 1)
or DEFICIT @ 12/31/94.
6. $ 802,323
7. $ 833, 855
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If L.6 > L.7, enter difference: SURPLUS 8a. $ 0
If L.7 > L.6, enter difference: DEFICIT Bb. $ 31,532
**00 to Section 3 if SURPLUS *** To Section 4 if DEFICIT**
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Section 3. Determination of 1995 Municipal
Normal Cost (line C, Schedule 1) ----------
Calculated Administrative Expense----------
Less:
K~ Minn. State Aid $ 0
L 5% of Line 5 0
M 10% of Line 8a 0
Total Subtractions ---------------
1995 City Contribution if SURPLUS exists (L. 8a)
Contribution (if SURPLUS)
9. $ 0
10. $ 0
11. $ 0
---------
12. $ 0
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Section 4. Determination of Municipal Contribution
Normal Cost (Line C, Sch. 1) 13. $
Amortization of deficit(s) incurred
prior to end of 1994
YR ORIGIN. AMT RET AMT LEFT
INCUR. AMOUNT PRE V TO RETIRE
(1) (2) (3)
19 0
19 0
19 0
Totals 0 0 0
TOT ORIG DEF 0 -------- X . 10 ------
Deduct col f3) total from L. Bb.
If col 3 < .8b, difference is a
NEW DEFICIT. $ 31,532 X .10 =--------
Calculated Administrative Expense -----------------
Total Costs -------
-
LESS:
N) Minn. State Aid ------ $ 38,514
0) 5% of Line 5---------- $ 40 116
Total Subtractions ------------~-------------------
1995 City Contribution, if DEFICIT exists (L.Bb)
(if DEFICIT)
73,508
14. $ 0
15. $ 3,153
16. $ 1,760
----------
$ 78,421
17. $ 78,630
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18. $ (209)
AVERAGE SPECIAL FUND INCOME bnon-investment) PER MEMBER
. FOR PREVIOUS THREE YEAR PERI D.
ACTV STATE LOCAL 1/10 ANNUAL 3YR
FF AID TAXES SURPLUS TOTAL TOTAL
34 1993 38,514 19 000 0 57,514
35 1992 38 590 19:000 0 57,590
30 1991 38;907 19,000 0 57,907 173,011
33
3YR TOT/3/IMBR 57,670 33 = tl,748 AVG PER MBR
Max pension (Avg. X 1.85) 3,233
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CERTIFICATION OF SPECIAL FUND REQUIREMENTS
This information must be certified to the clerk of the municipality or
to the independent non-profit firefighting corporation by 08/01/94.
We, the officers of the Elk River Firefighters' Relief Association,
state that the acc~ying schedules have been prepared in accordance
with the provisions of the Min. Stat. Ch. 69.772, sUbd 4. The average
amount of available financing per active member for the past three years was
$1,748 Further, benefit levels have been established in accordance
with the average amount of available financing, as required by law.
The minimum city contribution for 1995 is: ($209)
-------------------,
President
Secretary
Treasurer
Date__________________
Date__________________
Date__________________
-------------------,
.
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These Schedules were ~repared
from information prov~ded by
Officers of the Relief Association
and State Auditor Reports.
Calculated as 12/31/94
Prepared by:
Gus Welter, consultant
1901 Meadowview Road
Bloomington, MN 55425
(612) 854-8856
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CLERK'S CERTIFICATION
I am the clerk (or other designated official) of the city of Elk River.
I have received the completed Office of the State Auditor Schedules I & II
from the Elk River Firefighters Relief Association on t 1994.
I have reviewed Section 21 lines 8, 12 and 18. If line-I2-or-I~ne 18
reflects a required munic~pal contributiont I certify that I will
so advise the municipal governing body at ~ts next regularly scheduled
meeting. If the Certification of the Officers discloses that the Bylaws
have been amended to provide a benefit increase, I certify that the
municipal governing body has passed a resolution which approves the change
in the bylaws. A copy of the resolution is attached (if required).
Date________________,1994
Phone #
Signature ____________________________
Title
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(Note: Failure to file this document in a timely manner, whether or not
a municipal contribution is required, will result in loss of state aid.)