2012 Comprehensive Annual Financial Report - the City of Tukwila
2012 Comprehensive Annual Financial Report - the City of Tukwila 2012 Comprehensive Annual Financial Report - the City of Tukwila
CITY OF TUKWILA: 2012 CAFRNOTES TO THE FINANCIAL STATEMENTSserving in the uniformed services, may apply for interruptive military service credit. Should any suchmember die during this active duty, the member’s surviving spouse or eligible child(ren) may purchaseservice credit on behalf of the deceased member.PSERS members may also purchase up to 24 consecutive months of service credit for each period oftemporary duty disability.Beneficiaries of a PSERS Plan 2 member with ten years of service who is killed in the course ofemployment receive retirement benefits without actuarial reduction, if the member was not at normalretirement age at death. This provision applies to any member killed in the course of employment, iffound eligible by the Director of the Department of Labor and Industries.There are 76 participating employers in PSERS. Membership in PSERS consisted of the following as ofthe latest actuarial valuation date for the plan of June 30, 2011:Type of MembershipMembershipRetirees and Beneficiaries Receiving Benefits 15Terminated Plan Members Entitled to but not yet Receiving Benefits 1Active Plan Members Vested 167Active Plan Members Non-vested 4,020Total 4,203Funding PolicyEach biennium, the state Pension Funding Council adopts PSERS Plan 2 employer and employeecontribution rates. The employer and employee contribution rates for Plan 2 are developed by the Officeof the State Actuary to fully fund Plan 2. All employers are required to contribute at the level establishedby the Legislature. The methods used to determine the contribution requirements are established understate statue in the accordance with Chapters 41.37 and 41.45 RCW.The required contribution rates expressed as a percentage of covered payroll as of December 31, 2012are as follows:PSERS Plan IIEmployer 8.887%Employee 6.36%Both the City and the employees made the required contributions. The City’s required contributions tothe LEOFF system for the years ended December 31 are as follows:PSERS Plan II2012 $ 11,1872011 8,7122010 -88
CITY OF TUKWILA: 2012 CAFRNOTES TO THE FINANCIAL STATEMENTSFiremen’s Pension SystemPlan DescriptionThe City is the administrator of the Firemen’s Pension Plan which is a closed, single-employer, definedbenefit pension plan that was established in conformance with RCW Chapter 41.18. This plan providesretirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan membersand beneficiaries. Membership is limited to fire fighters employed prior to March 1, 1970 when the LEOFFretirement system was established. The City’s obligation under the Firemen’s Pension Plan consists ofpaying all benefits, including payments to beneficiaries, for fire fighters who retired prior to March 1, 1970and excess benefits over LEOFF for covered fire fighters who retired after March 1, 1970. Benefits andrefunds of the defined benefit pension plan are recognized when due and payable in accordance with thePlan. The Plan does not issue a separate financial report.Membership of the Firemen’s Pension Plan consisted of the following at December 31, 2012.Type of MembershipTotalRetirees and beneficiaries receiving benefits 9Retirees currently receiving full retirement benefits through theLaw Enforcement Officers and Fire Fighters Retirement Plan (LEOFF) 2Total 11Funding PolicyUnder State law, the Firemen’s Pension Plan is provided an allocation of all monies received by the Statefrom taxes on fire insurance premiums; interest earnings; member contributions made prior to theinception of LEOFF; and City contributions required to meet projected future pension obligations. Anactuarial valuation was completed as of January 1, 2011 and it was determined that current assets of thefund, along with future revenues from state fire insurance taxes and interest earnings, will be sufficient topay all future Firemen’s Pension Plan pension benefits. In 2012 $52,249 was received from the statefrom taxes on fire insurance premiums. On-behalf payments of fringe benefits and salaries for the City’semployees were recognized as revenues and expenditures/expenses during the period. Costs toadminister the plan are paid for through investment earnings and General Fund resources. The ActuarialValuation of Firefighters’ Pension Fund table is reported in the Required Supplemental Informationsection, and a recap of the Schedule of Funding Progress is as follows:ActuarialValuation DateActuarial Valueof AssetsPENSION SCHEDULE OF FUNDING PROGRESSActuarialAccruedLiabilitiesUnfunded ActuarialAccrued Liabilities(UAAL) Funded Ratio Covered PayrollUAAL as aPercentage ofCovered PayrollJanuary 1, 2000 $1,076 $1,243 $167 87% $112 149%January 1, 2003 1,215 1,135 (80) 107 0 N/AJanuary 1, 2005 1,265 1,182 (83) 107 0 N/AJanuary 1, 2007 1,336 1,310 (26) 102 0 N/AJanuary 1, 2009 1,445 1,610 165 90 442 37January 1, 2011 1,430 1,582 152 90 371 41The Firemen’s Pension Plan does not issue a stand-alone financial report and is not included in anotherPublic Employee Retirement System or another entity. Biennially a complete actuarial valuation financialreport, including an accounting update for intervening years, is prepared by Milliman USA, Incorporated.This report is available from the City of Tukwila.89
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CITY OF TUKWILA: <strong>2012</strong> CAFRNOTES TO THE FINANCIAL STATEMENTSserving in <strong>the</strong> uniformed services, may apply for interruptive military service credit. Should any suchmember die during this active duty, <strong>the</strong> member’s surviving spouse or eligible child(ren) may purchaseservice credit on behalf <strong>of</strong> <strong>the</strong> deceased member.PSERS members may also purchase up to 24 consecutive months <strong>of</strong> service credit for each period <strong>of</strong>temporary duty disability.Beneficiaries <strong>of</strong> a PSERS Plan 2 member with ten years <strong>of</strong> service who is killed in <strong>the</strong> course <strong>of</strong>employment receive retirement benefits without actuarial reduction, if <strong>the</strong> member was not at normalretirement age at death. This provision applies to any member killed in <strong>the</strong> course <strong>of</strong> employment, iffound eligible by <strong>the</strong> Director <strong>of</strong> <strong>the</strong> Department <strong>of</strong> Labor and Industries.There are 76 participating employers in PSERS. Membership in PSERS consisted <strong>of</strong> <strong>the</strong> following as <strong>of</strong><strong>the</strong> latest actuarial valuation date for <strong>the</strong> plan <strong>of</strong> June 30, 2011:Type <strong>of</strong> MembershipMembershipRetirees and Beneficiaries Receiving Benefits 15Terminated Plan Members Entitled to but not yet Receiving Benefits 1Active Plan Members Vested 167Active Plan Members Non-vested 4,020Total 4,203Funding PolicyEach biennium, <strong>the</strong> state Pension Funding Council adopts PSERS Plan 2 employer and employeecontribution rates. The employer and employee contribution rates for Plan 2 are developed by <strong>the</strong> Office<strong>of</strong> <strong>the</strong> State Actuary to fully fund Plan 2. All employers are required to contribute at <strong>the</strong> level establishedby <strong>the</strong> Legislature. The methods used to determine <strong>the</strong> contribution requirements are established understate statue in <strong>the</strong> accordance with Chapters 41.37 and 41.45 RCW.The required contribution rates expressed as a percentage <strong>of</strong> covered payroll as <strong>of</strong> December 31, <strong>2012</strong>are as follows:PSERS Plan IIEmployer 8.887%Employee 6.36%Both <strong>the</strong> <strong>City</strong> and <strong>the</strong> employees made <strong>the</strong> required contributions. The <strong>City</strong>’s required contributions to<strong>the</strong> LEOFF system for <strong>the</strong> years ended December 31 are as follows:PSERS Plan II<strong>2012</strong> $ 11,1872011 8,7122010 -88
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