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NOTE 10 — DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) 2. PEPFF Pension Costs At December 31, 2022, the City reported a liability of $11,196,681 for its proportionate share of the PEPFF's net pension liability. The net pension liability was measured as of June 30, 2022, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The City's proportionate share of the net pension liability was based on the City's contributions received by PERA during the measurement period for employer payroll paid dates July 1, 2021, through June 30, 2022, relative to the total employer contributions received from all of PERA's participating employers. The City's proportionate share was 0.2573% at the end of the measurement period and 0.2447% for the beginning of the period. The State of Minnesota also contributed $18 million to the PEPFF in the plan fiscal year ended June 30, 2022. The contribution consisted of $9.0 million in direct state aid that does meet the definition of a special funding situation and $9.0 million in supplemental state aid that does not meet the definition of a special funding situation. The $9.0 million of direct state was paid on October 1, 2021. Thereafter, by October 1 of each year, the state will pay $9 million to the PEPFF until full funding is reached by July 1, 2048, whichever is earlier. The $9 million in supplemental state aid will continue until the fund is 90% funded, or until the State Patrol Plan (administered by the Minnesota Retirement System) is 90% funded, whichever occurs later. The State of Minnesota is included as a non -employer contributing entity in the PEPFF Schedule of Employer Allocations and Schedule of Pension Amounts by Employer, Current Reporting Period Only (pension allocation schedules) for the $9.0 million in direct state aid. PEPFF employers need to recognize their proportionate share of the State of Minnesota's pension expense (and grant revenue) under GASB 68 special funding situation accounting and financial reporting requirements. For the year ended December 31, 2022, the City recognized pension expense of $1,154,205 for its proportionate share of the PEPFF's pension expense. The City recognized $94,865 as grant revenue for its proportionate share of the State of Minnesota's pension expense for the contribution of $9.0 million to the PEPFF. The amount recognized by the City as its proportionate share of the net pension liability, the direct aid and total portion of the net pension liability that was associated with the City were as follows: City's proportionate share of the net pension liability 11,196,681 State of Minnesota's proportionate share of the net pension liability associated with the City 489,060 Total $11,685,741 The State of Minnesota is not included as a non -employer contributing entity in the PEPFF allocation schedules for the $9 million in supplemental state aid. The City also recognized $23,157 for the year ended December 31, 2022 as revenue and an off -setting reduction of net pension liability for its proportionate share of the State of Minnesota's on -behalf contributions to the PEPFF. 85