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NOTE 10 —DEFINED BENEFIT PENSION PLANS —STATE-WIDE (CONTINUED) <br />At December 31, 2022, the City reported its proportionate share of the PEPFF's deferred outflows <br />of resources and deferred inflows of resources related to pensions from the following sources: <br />Deferred <br />Deferred <br />Outflows of <br />Inflows of <br />Resources <br />Resources <br />Differences between expected and actual economic experience <br />$ 6671726 <br />$ - <br />Changes in actuarial assumptions <br />6,4761614 <br />601583 <br />Net collective difference between projected and actual <br />investment earnings <br />281,022 <br />- <br />Changes in proportion <br />220,561 <br />61526 <br />Contributions paid to the PERA subsequent to the measurement <br />date <br />277,786 <br />- <br />Total <br />7 923 709 <br />67 109 <br />A total of $277,786 reported as deferred outflows of resources related to pensions resulting from City <br />contributions subsequent to the measurement date will be recognized as a reduction of the net pension <br />liability in the year ending December 31, 2023. Other amounts reported as deferred outflows and <br />inflows of resources related to pensions will be recognized in pension expense as follows: <br />Year ended December 31: <br />2023 <br />2024 <br />2025 <br />2026 <br />2027 <br />Total <br />Pension Expense Amount <br />E. Long -Term Expected Return on Investments <br />$ 1,493,43 3 <br />1149913 66 <br />113341450 <br />213031767 <br />947.798 <br />7,578,814 <br />The Minnesota State Board of Investment, which manages the investments of the PERA, prepares an <br />analysis of the reasonableness on a regular basis of the long-term expected rate of return using a <br />building-block method in which best -estimate ranges of expected future rates of return are developed <br />for each major asset class. These ranges are combined to produce an expected long-term rate of return <br />by weighting the expected future rates of return by the target assess allocation percentages. <br />The target allocation and best -estimates of geometric real rates of return for each major asset class are <br />summarized in the following table: <br />Asset Class <br />Domestic Equity <br />International Equity <br />Fixed Income <br />Private Markets <br />Total <br />TarLyet Allocation <br />33.50% <br />16.50% <br />25.00% <br />5 nnoi,, <br />100.00% <br />Long -Term Expected Real Rate <br />of Return <br />5.10% <br />5.30% <br />0.75% <br />5.90% <br />86 <br />