18 - Firefighters Relief & Retirement Fund -Pursue a Pension Bond - Freeze Fire Pension - Transfer Employees to TMRS

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For the employees, they will go from 16% annual contribution to the existing pension to 7% annual contribution to the new TMRS account like all other employees. This will be a significant benefit to these employees. All in all, there appear to be significant wins for the employees, taxpayers, and municipal operations if this works out. And finally, assuming the market and return on investment holds favorably, the large deposit could see the fund through final life of the program, the taxpayer's expense for pension should end when the final payment for debt is completed (20 years), and the pension itself will terminate upon the passing of the final beneficiary with all future beneficiaries within the department coming under the TMRS. Disclaimer — It must be stated that this all assumes a favorable market and return on investments. It is not impossible that at some future point, the City might have to deposit additional funds (possibly even another smaller bond) to fund the Pension. We are working off of best estimates assuming future variables, all produced by an actuary. However, having frozen the fund with no new employees entering in to it, the City will have hedged its risk and eventually will bring it to a conclusion. OPTIONS: 1. Authorize the City Manager to continue pursuing this project and bring back at a future date a Pension Bond and an agreement with the Pension Board. 2. Request additional information to be brought back. 3. Reject the proposal and keep the Pension as is. 4. Recommend other solutions for funding the pension and/or giving employees a better retirement benefit. RECOMMENDATION: 1. Authorize the City Manager to continue pursuing this project and bring back at a future date a Pension Bond and an agreement with the Pension Board.