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Discount Rate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¶VDFWXDULDOIXQGLQJSROLF\DQGDVUHTXLUHGE\56$$ %DVHGRQWKRVHDVVXPSWLRQVWKHSHQVLRQSODQ¶VILGXFLDU\QHWSRVLWLRQZDVSURMHFWHG WREHDYDLODEOHWRPDNHDOOSURMHFWHGIXWXUHEHQHILWSD\PHQWVWRFXUUHQWSODQPHP EHUV7KHUHIRUHWKHORQJWHUPH[SHFWHGUDWHRIUHWXUQRQSHQVLRQSODQLQYHVWPHQWV ZDVDSSOLHGWRDOOSHULRGVRISURMHFWHGEHQHILWSD\PHQWVWRGHWHUPLQHWKHWRWDOSHQ VLRQOLDELOLW\ H. Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount Rate 7KHIROORZLQJSUHVHQWVWKH&LW\¶VSURSRUWLRQDWHVKDUHRIWKHQHWSHQVLRQOLDELOLW\ FDOFXODWHGXVLQJWKHGLVFRXQWUDWHRIDVZHOODVZKDWWKH&LW\¶VSURSRUWLRQDWH VKDUHRIWKHQHWSHQVLRQOLDELOLW\ZRXOGEHLILWZHUHFDOFXODWHGXVLQJDGLVFRXQWUDWH WKDWLVSHUFHQWDJHSRLQWORZHU RUSHUFHQWDJHSRLQWKLJKHU WKDQ WKHFXUUHQWUDWH &XUUHQW 'HFUHDVH 'LVFRXQW5DWH ,QFUHDVH I. Pension Plan Fiduciary Net Position 'HWDLOHGLQIRUPDWLRQDERXWWKHSHQVLRQSODQ¶VILGXFLDU\QHWSRVLWLRQLVDYDLODEOHLQ WKHVHSDUDWHO\LVVXHG1+56ILQDQFLDOUHSRUW Public Works Employees’ Retirement System 7KH&LW\IROORZVWKHSURYLVLRQVRI*$6%6WDWHPHQW1RFinancial Reporting for Pension Plans – an amendment of GASB Statement No. 25 DQG*$6%6WDWHPHQW1R Accounting and Financial Reporting for Pensions – an amendment of GASB Statement No. 27, ZLWKUHVSHFWWRWKHHPSOR\HHV¶UHWLUHPHQWIXQGV A. Plan Description $OO3XEOLF:RUNVHPSOR\HHVRIWKH&LW\DUHPHPEHUVRIWKH3XEOLF:RUNV(PSOR\HHV¶ 5HWLUHPHQW6\VWHP WKH6\VWHP DVLQJOHHPSOR\HUGHILQHGEHQHILW3(56(OLJLEOH HPSOR\HHVPXVWSDUWLFLSDWHLQWKH6\VWHP7KHSHQVLRQSODQSURYLGHVSHQVLRQEHQH ILWVDQGGHDWKDQGGLVDELOLW\EHQHILWVWRHPSOR\HHVUHDFKLQJDJHSURYLGHGWKH\ KDYHDFFXPXODWHG\HDUVRIVHUYLFH$&LW\RUGLQDQFHSDVVHGLQ HVWDEOLVKHG A-77 WKH6\VWHPZKLFKLVDGPLQLVWHUHGE\DILYHPHPEHU%RDUGRI7UXVWHHV$PHQG PHQWVWREHQHILWSURYLVLRQVDUHPDGHE\WKH%RDUGRI7UXVWHHVZLWKWKHFRQFXUUHQFH RIWKH%RDUGRI$OGHUPHQ7KH3XEOLF:RUNV(PSOR\HHV¶5HWLUHPHQW6\VWHPGRHV QRWLVVXHLQGHSHQGHQWILQDQFLDOVWDWHPHQWV$GPLQLVWUDWLYHFRVWVDUHILQDQFHGE\ 7UXVWHDUQLQJV 0HPEHUVKLSRIHDFKSODQFRQVLVWHGRIWKHIROORZLQJDW-XO\WKHGDWHRIWKH ODWHVWDFWXDULDOYDOXDWLRQ ,QDFWLYHSODQPHPEHUVRUEHQHILFLDULHVUHFHLYLQJEHQHILWV ,QDFWLYHSODQPHPEHUVHQWLWOHGWREXWQRW\HW UHFHLYLQJEHQHILWV $FWLYHSODQPHPEHUV 7RWDO B. Benefits Provided 7KH6\VWHPSURYLGHVIRUUHWLUHPHQWDQGGHDWKEHQHILWV7KHUHWLUHPHQWDOORZDQFH EHQHILWLVXSWRDPD[LPXPRIILQDOFRPSHQVDWLRQUHGXFHGSURSRUWLRQDWHO\IRU FUHGLWDEOHVHUYLFHVOHVVWKDQ\HDUV LIKLUHGDIWHU-XO\ %HQHILWSD\ PHQWVDUHEDVHGXSRQDPHPEHU¶VDJHDQGOHQJWKRIFUHGLWDEOHVHUYLFH0HPEHUV EHFRPHIXOO\YHVWHGDIWHU\HDUVRIFUHGLWDEOHVHUYLFH$UHWLUHPHQWDOORZDQFH PD\EHUHFHLYHGXSRQUHDFKLQJDJRZLWK\HDUVRIFUHGLWHGVHUYLFHRUXSRQ DWWDLQLQJ\HDUV \HDUVLIKLUHGDIWHU-XO\ RIFRQWLQXRXVVHUYLFHZLWK WKH%RDUGRI3XEOLF:RUNV7KHSODQDOVRSURYLGHVIRUHDUO\UHWLUHPHQWIRURI ILQDOFRPSHQVDWLRQUHGXFHGE\IRUHDFKPRQWKEHWZHHQDJHDQGWKH PHPEHU¶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ontributions 7KH&LW\HPSOR\HHVHDFKFRQWULEXWH RIWKHLUEDVHVDODU\DVVSHFLILHGE\ RUGLQDQFH7KH&LW\¶VFRQWULEXWLRQLVGHWHUPLQHGE\WKHDFWXDULDOYDOXDWLRQ7KH A-78 &LW\¶VFRQWULEXWLRQWRWKH6\VWHPIRUWKH\HDUHQGHG-XQHZDV ZKLFKZDVHTXDOWRLWVDQQXDOUHTXLUHGFRQWULEXWLRQ D. Summary of Significant Accounting Policies 7KHDFFRXQWLQJSROLFLHVRIWKH6\VWHPDVUHIOHFWHGLQWKHDFFRPSDQ\LQJILQDQFLDO VWDWHPHQWVIRUWKH\HDUHQGHG-XQHFRQIRUPWRJHQHUDOO\DFFHSWHGDFFRXQW LQJSULQFLSOHVIRUSXEOLFHPSOR\HHUHWLUHPHQWV\VWHPV 3(56 7KHPRUHVLJQLIL FDQWDFFRXQWLQJSROLFLHVRIWKH6\VWHPDUHVXPPDUL]HGEHORZ Basis of accounting &RQWULEXWRU\UHWLUHPHQWV\VWHPILQDQFLDOVWDWHPHQWVDUHSUH SDUHGXVLQJWKHDFFUXDOEDVLVRIDFFRXQWLQJ3ODQPHPEHUFRQWULEXWLRQVDUHUHFRJ QL]HGDVUHYHQXHLQWKHSHULRGLQZKLFKWKHPHPEHUVSURYLGHVHUYLFHVWRWKHHPSOR\HU (PSOR\HUFRQWULEXWLRQVDUHUHFRJQL]HGZKHQGXHDQGWKHHPSOR\HUKDVPDGHDIRU PDOFRPPLWPHQWWRSURYLGHWKHFRQWULEXWLRQV%HQHILWVDQGUHIXQGVDUHUHFRJQL]HG ZKHQGXHDQGSD\DEOHLQDFFRUGDQFHZLWKWKHWHUPVRIWKHSODQ Investment policy ,QYHVWPHQWVDUHUHSRUWHGDWIDLUYDOXHLQDFFRUGDQFHZLWKUHTXLUH PHQWV6\VWHPDVVHWVDUHPDQDJHGRQDWRWDOUHWXUQEDVLVZLWKDORQJWHUPREMHFWLYH RIDFKLHYLQJDQGPDLQWDLQLQJDIXOO\IXQGHGVWDWXVIRUWKHEHQHILWVSURYLGHGWKURXJK WKHSHQVLRQSODQ Rate of return )RUWKH\HDUHQGHG-XQHWKHDQQXDOPRQH\ZHLJKWHGUDWH RIUHWXUQRQSHQVLRQSODQLQYHVWPHQWVQHWRISHQVLRQSODQLQYHVWPHQWH[SHQVHV ZDV 7KHPRQH\ZHLJKWHGUDWHRIUHWXUQH[SUHVVHVLQYHVWPHQWSHUIRUPDQFH QHWRILQYHVWPHQWH[SHQVHDGMXVWHGIRUWKHFKDQJLQJDPRXQWVDFWXDOO\LQYHVWHG Net pension liability )RUSXUSRVHVRIPHDVXULQJWKHQHWSHQVLRQOLDELOLW\GHIHUUHG RXWIORZVRIUHVRXUFHVDQGGHIHUUHGLQIORZVRIUHVRXUFHVUHODWHGWRSHQVLRQVDQG SHQVLRQH[SHQVHLQIRUPDWLRQDERXWWKHILGXFLDU\QHWSRVLWLRQRIWKH6\VWHPDQG DGGLWLRQVWRGHGXFWLRQVIURP6\VWHP¶VILGXFLDU\QHWSRVLWLRQKDYHEHHQGHWHUPLQHG RQWKHVDPHEDVLVDVWKH\DUHUHSRUWHGE\6\VWHP)RUWKLVSXUSRVHEHQHILWSD\ PHQWV LQFOXGLQJUHIXQGVRIHPSOR\HHFRQWULEXWLRQV DUHUHFRJQL]HGZKHQGXHDQG SD\DEOHLQDFFRUGDQFHZLWKEHQHILWWHUPV,QYHVWPHQWVDUHUHSRUWHGDWIDLUYDOXH E. Net Pension Liability of the City 7KHFRPSRQHQWVRIWKHQHWSHQVLRQOLDELOLW\RIWKH&LW\DW-XQHZHUHDV IROORZV 7RWDOSHQVLRQOLDELOLW\ 3ODQILGXFLDU\QHWSRVLWLRQ (PSOR\HUV QHWSHQVLRQOLDELOLW\ 3ODQILGXFLDU\QHWSRVWLRQDVD SHUFHQWDJHRIWRWDOSHQVLRQOLDELOLW\ A-79 Changes in the Net Pension Liability - Board of Public Works ,QFUHDVH 'HFUHDVH 7RWDO3HQVLRQ 3ODQ)LGXFLDU\ 1HW3HQVLRQ /LDELOLW\ 1HW3RVLWLRQ /LDELOLW\ %DODQFHVDW-XQH &KDQJHVIRUWKH\HDU 6HUYLFHFRVW ,QWHUHVW 'LIIHUHQFHVEHWZHHQH[SHFWHGDQG DFWXDOH[SHULHQFH &KDQJHVRIDVVXPSWLRQV &RQWULEXWLRQVHPSOR\HU &RQWULEXWLRQVHPSOR\HH 1HWLQYHVWPHQWLQFRPH %HQHILWSD\PHQWVLQFOXGLQJUHIXQGVRI HPSOR\HHFRQWULEXWLRQV $GPLQLVWUDWLYHH[SHQVH 1HWFKDQJHV %DODQFHVDW-XQH F. 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