Texas Pension Review Board House Pensions Committee September 29, - - PowerPoint PPT Presentation
Texas Pension Review Board House Pensions Committee September 29, 2016 Systems Overview Governance Dallas Employees Chapter 40A of the Dallas City Code Retirement Fund (DERF) Seven-member board Dallas Police & Fire Pension Article
Dallas Employees’ Retirement Fund (DERF) Chapter 40A of the Dallas City Code Seven-member board Dallas Police & Fire Pension System (DPFPS) Article 6243a-1, Vernon’s Texas Civil Statutes Twelve-member board Fort Worth Employees’ Retirement Fund (FWERF) Article 6243i, Vernon’s Texas Civil Statutes Thirteen-member board
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DERF DPFPS
Benefit Types Service retirement, disability, and death benefits Service retirement, disability, and death benefits Benefit Tiers No Yes, includes five groups DROP Available No Yes (all members) COLA Yes (automatic COLA for all members) Yes (automatic COLA for Group A and Group B Tier 1. Ad-hoc for Group B Tier
Social Security Participation No No
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FWERF
Benefit Types Service retirement, disability, and death benefits Benefit Tiers Yes, includes six groups with multiple tiers DROP Available Yes (all members) COLA Yes, Tier 1: ad-hoc COLA contingent upon the funding status, or 2% simple. Tier 2: none Social Security Participation No
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Current Actuarial Snapshots
Active Annuitant Member Employer DERF 12/31/2015 $3.3 B $4.1 B $0.8 B 80.41% Infinite 8.00% 7,477 6,756 13.32% 14.33%1 DPFPS 1/1/2016 $2.7 B $5.9 B $3.3 B 45.07% Infinite 7.25% 5,415 4,230 7.08%2 30.53% FWERF 12/31/2015 $2.2 B $3.6 B $1.4B 60.65% 72.5 years 7.75% 6,280 4,042 8.00%3 19.97%
Key: AVA - Actuarial Value of Assets AAL - Actuarial Accrued Liability UAAL - Unfunded Actuarial Accrued Liability
Contribution
2 Member contributions are 8.50% of computation pay for participants who do not currently participate in the DROP, and 4.00% for DROP participants. The weighted
average of the member rates is 7.08% as of the valuation date.
3 Municipal employees and firefighters contribute 8.25% of pay, while police contribute 8.73%. Because members no longer contribute on overtime pay, the weighted
average of employee contributions between all five plan tiers is 8.00% of total compensation. The city of Fort Worth contributes 19.74% of pay for municipal employees and firefighters and 20.46% for police.
Plan Name Date of Valuation AVA AAL UAAL Funded Ratio Amortization Period Discount Rate Membership
1 The employer contribution shown reflects the amount paid by the City after subtracting out their pension obligation bond (POB) contribution.
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Funding Trends Funded Ratio, Assets, Liabilities and Year over Year Growth
Valuation Date, 12/31 2010 2011 2012 2013 2014 2015 Funded Ratio 92.24% 86.00% 80.89% 85.14% 80.94% 80.41% Amortization Period (years) 30 30 30 51 Infinite Infinite UAAL (in millions) $254.69 $474.91 $672.23 $536.56 $763.00 $808.75 AVA (in billions) $3.03 $2.92 $2.85 $3.07 $3.24 $3.32 AVA Growth (YoY)
8.02% 5.42% 2.45% AAL (in billions) $3.28 $3.39 $3.52 $3.61 $4.00 $4.13 AAL Growth (YoY) 2.82% 3.34% 3.74% 2.63% 10.89% 3.12%
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Funding Trends Funded Ratio, Assets, Liabilities and Year over Year Growth
Valuation Date, 1/1 2011 2012 2013 2014 2015 2016 Funded Ratio 79.48% 73.95% 78.12% 75.59% 63.80% 45.07% Amortization Period (years) 21 30 23 26 Infinite Infinite UAAL (in millions) $885.53 $1,190.37 $1,063.18 $1,251.87 $2,096.94 $3,267.05 AVA (in billions) $3.43 $3.38 $3.80 $3.88 $3.70 $2.68 AVA Growth (YoY) 1.42%
12.33% 2.17%
AAL (in billions) $4.32 $4.57 $4.86 $5.13 $5.79 $5.95 AAL Growth (YoY) 4.43% 5.85% 6.33% 5.58% 12.93% 2.68%
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Funding Trends Funded Ratio, Assets, Liabilities and Year over Year Growth
Valuation Date, 12/31 2010 2011 2012 2013 2014 2015 Funded Ratio 76.60% 71.42% 63.26% 63.86% 62.23% 60.65% Amortization Period (years) 19.5 28.4 36 49.3 55.7 72.5 UAAL (in millions) $578.96 $748.21 $1,077.42 $1,128.97 $1,271.15 $1,398.33 AVA (in billions) $1.89 $1.87 $1.85 $2.00 $2.09 $2.15 AVA Growth (YoY) 18.42%
7.56% 4.98% 2.89% AAL (in billions) $2.47 $2.62 $2.93 $3.12 $3.37 $3.55 AAL Growth (YoY) 12.95% 5.83% 12.01% 6.54% 7.73% 5.58%
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*Calculated as of 1/1 *Calculated as of 1/1
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*Calculated as of 1/1
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*Calculated as of 1/1, for the city’s fiscal year beginning 10/1
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*Calculated as of 1/1, for the city’s fiscal year beginning 10/1
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*Calculated as of 1/1, for the city’s fiscal year beginning 10/1
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*Calculated as of 1/1, for the city’s fiscal year beginning 10/1
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*Calculated as of 1/1, for the city’s fiscal year beginning 10/1
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*Calculated as of 1/1
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*Calculated as of 1/1
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*Calculated as of 1/1
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*Calculated as of 1/1
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* In 2005, DERF had a large increase in contributions ($588,961,000) due to the issuance of pension obligation bonds.
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*Investment returns are net of investment expenses.
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*Net investment returns are net of investment expenses.
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*Includes Cash, Securities Lending, Capital Assets, and Receivables
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2015 GASB 67 Reported Information System DERF DPFPS Total Pension Liability (TPL) $5,367,564,000 $9,536,840,000 Fiduciary Net Position $3,202,208,000 $2,680,124,000 Net Pension Liability (NPL) $2,165,356,000 $6,856,716,000 Funded Ratio 59.66% 28.10% Long-Term Expected Rate of Return 8.00% 7.25% TPL Discount Rate (Blended) 5.76% 3.95% NPL at Discount Rate – 1% $2,915,146,000 $8,471,987,000 NPL at Discount Rate +1% $1,457,749,000 $5,581,404,000 Muni Bond Rate 3.57% 3.57% Money-Weighted Rate of Return
DROP Balance N/A $1,517,000,000
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2015 GASB 67 Reported Information System FWERF Total Pension Liability (TPL) $4,127,343,024 Fiduciary Net Position $2,003,269,563 Net Pension Liability (NPL) $2,124,073,461 Funded Ratio 48.54% Long-Term Expected Rate of Return 8.00% TPL Discount Rate (Blended) 6.25% NPL at Discount Rate – 1% $2,845,284,182 NPL at Discount Rate +1% $1,773,132,040 Muni Bond Rate 3.71% Money-Weighted Rate of Return
DROP Balance $108,600,000