HomeMy WebLinkAboutMinutes - Finance Committee - 09/27/2010 -r r
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Council Audit ft Finance Committee
Minutes
9/27/10
2:30a.m.4:00p.m.
Council Attendees:Mayor Doug Hutchinson,Mayor Pro Tern Kelly
Ohlson,Ben ManveL
City Staff Attendees:Darin Atteberry,John Voss,Mike Freernan,Rick
Richter,Greg Tempel,Harold Hall,Amy Sharkey,
Heather Shepherd
Others:
GERC Funding
Mike Freeman explained that this topic was originally presented to Council Finance
Committee in April,2010.At that meeting,information was presented showing that
there would be a future shortfall in funding the General Employee’s Retirement Plan,
and options were presented for closing this gap.City staff recommended a specific
action,however one fact wasn’t clear at the time.In addition to the current
contribution amount of 4.5%,the City will move it’s 3%ICMA contribution to the
GERP,and also contribute another 3%,for a total contribution of 10.5%.The City will
also continue the supplemental amount of $740,000.
The Committee members asked some clarifying questions regarding the exampLe sheet
that was distributed.See attached.
Mike Freeman stressed the importance of understanding the scenarios or options
before making a final decision.
John Voss explained an additional turn of events that was recently discovered.
Originally,due to an error,the $740,000 supplemental amount did not end up in the
City 2011-2012 budget.Now,to regain that amount,‘cost savings’from various
departments will be used.(Only from City departments who currently have GERP
members).That problem will be corrected.
Kelly Ohlson asked about timing and the reason for this action being taken sooner
rather than later.Mike Freeman said there are two reasons.First,it will take a
huge amount of staff time to ‘fix’the budget at this point.Second,there have been
City ofFortCoLlins
a host of plan member meetings and communication so there is some expectation that
action wiLL be taken.
KelLy OhLson asked if the CounciL Finance Committee is automaticaLLy advised on the
performance of GERP financials.Mike Freeman stated that data is presented to this
Committee every year by the actuariaL firm contracted with the City.
As a result of this meeting,the CounciL Finance Committee directs the Finance
department to proceed with bringing this topic before City CounciL,for a vote on the
funding options for GERP going forward.
Total City Cost Projections:
Current Proposed (All Members)Freeze (All Members)Lump Sum Payout (All Members)
Year Proposed GERP ICMA Proposed GERP Proposed ICMA Proposed ICMA Actives
Supplemental 4.5%Contribution 3.0%Contribution Supplemental 10.5%Contribution Supplemental 7.5%Contribution Supplemental 7.5%Contribution Remaining
2010 ---------100.0%
2011 1175,00000 499.500,00 333,000.00 740,000.00 1,172,900.00 590.000,00 832,500.00 600,000.00 832,500.00 92.5%
2012 1,175,000.00 472,500.00 315,000.00 740,000.00 1,109,500.00 590.000,00 787.500,00 600,000.00 787,500.00 87.5%
2013 1,175,000,00 445,500.00 297,000.00 740,000.00 1,046,100.00 590.000,00 742,500.00 600,000.00 742,500.00 82.5%
2014 1,175,000.00 418,500.00 279,000.00 740,000.00 982,700.00 590,000.00 697,500.00 600,000.00 697,500.00 77.5%
2015 1,175,000.00 391,500.00 261,000.00 740,000.00 919,300.00 590,000.00 652,500,00 600,000.00 652,500.00 72.5%
2016 1,175,000.00 364,500.00 243,000.00 740,000.00 855,900.00 590,000.00 607,500.00 600,000.00 607,500,00 67.5%
2017 1,175,000.00 326,700,00 217,800,00 740,000.00 767,140,00 590,000,00 544,500,00 600,000.00 544.500,00 60,5%
2018 1,175,000,00 280,900.00 192,600.00 740,000,00 678,380.00 590000.00 481 500,00 600,000,00 481,500.00 53.5%
2019 1,175,000,00 251,100.00 167400.00 740,000.00 589,620,00 590 000.00 41850000 600,000,00 418,500,00 46.5%
2020 1,175,000,00 213,300.00 142,200,00 740,000.00 500,860.00 590 000.00 355 500.00 600,000.00 355.500,00 39.5%
2021 1,175,000.00 175,500,00 117000.00 740,000,00 412,100,00 590 000.00 29250000 600,000,00 292,500.00 32.5%
2022 1,175,000,00 156.600,00 104,400.00 740,000,00 367,720.00 590000,00 261 000,00 600,000.00 261,000.00 29,0%
2023 1,175,000.00 137,700,00 91,800.00 740,000.00 323,340,00 590 000.00 229 500.00 600,000.00 229,500,00 25.5%
2024 1,175,000,00 118,800,00 79,200.00 740,000.00 278,960.00 590 000.00 19800000 600,000,00 198,000.00 22.0%
2025 1,175,000,00 99,900.00 66,600,00 740,000,00 234580.00 590 000,00 166 500,00 600,000.00 166,500.00 18,5%
2026 1,175,000,00 81,000.00 54,000,00 740,000.00 190,200,00 590 000,00 135 000.00 600,000.00 135,000,00 15,0%
2027 1,175,000.00 72,900,00 48,600.00 740,000,00 171,180,00 590 000.00 121 50000 600,000,00 121,500,00 13.5%
2028 1,175,000,00 64,600.00 43,200.00 740,000,00 152,160.00 590000.00 108000,00 600,000,00 108,000.00 12.0%
2029 1,175,000,00 56,700.00 37,800,00 740,000.00 133,140,00 590 000.00 94 500.00 600,000.00 94,500.00 10.5%
2030 1,175,000.00 48,600.00 32,400.00 740,000.00 114,120.00 590000.00 81 000.00 600,000.00 81,000.00 9.0%
2031 1,175,000.00 40,500.00 27,000,00 740,000.00 95,100,00 590 000.00 67 500.00 600,000.00 67.500,00 7.5%
2032 1,175,000.00 36,450.00 24,300,00 740,000,00 85,590,00 590000.00 60750.00 600,000,00 60,750,00 6.8%
2033 1,175,000.00 32,400,00 21,600,00 740,000.00 76,080,00 590000.00 54000.00 600,000,00 54,000,00 6.0%
2034 1.175,000.00 28,350,00 18,900.00 740,000,00 66,570.00 590 000.00 47 250,00 600,000,00 47,250.00 5.3%
2035 24,300.00 16,200,00 57060.00 40,500,00 40,500,00 4.5%
2036 20,250.00 13,500.00 47,550.00 33750,00 33,750.00 3.8%
2037 16,200.00 10,800.00 38,040,00 27 000.00 27,000,00 3.0%
2038 12,150.00 8100.00 28,530.00 20 250,00 20,250.00 2.3%
2039 8,100.00 5.400,00 1902000 13,500.00 13,500.00 1.5%
2040 4,050.00 2,700.00 9 510.00 6,750,00 6,750.00 0,8%
2041 0.00 0.00 0 00 0.00 0.00 0.0%
2042
2043
2044
2045
2046
2047
2048
2049
2050
Sum 28.200,000,00 4.907,250.00 3.271,500,00 17,760,000.00 11.522.950.00 14,160,000,00 8,178.750.00 14.400 000.00 8 178,750.00
Total 36,378,750.00 29,282,950.00 22,338,750.00 22,578,150.00
Costs:
Current Plan
Cost reduction (Current vs Proposed)
Proposed Plan
Cost reduction (Proposed vs Freeze)
Freeze Option
Cost Increase (Freeze vs Lump-Sum)
Lump-Sum Option
Assumptions:
$36,378,750.00
(7,095,800.00)$
5 29,282,950.00
$(6,944,200.00)
5 22,338,750.00
5 240,000.00
5 22,578,750,00
Investment Return on Assets
No pay increases
7.5%
C:\Documents and Settinosthsherjhercl\Locat Settinas\Temoorarv Internet Files\OLKI 18\GERP Cont Calc.xls