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NOTE 8 — DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) <br />The target allocation and best estimates of geometric rates of return for each major class are summarized <br />in the following table: <br />Asset Class Target Allocation <br />Domestic Equity 35.5% <br />Private Markets 25.0% <br />Fixed Income 20.0% <br />International Equity 17.5% <br />Cash Equivalents 2.0% <br />Total 100% <br />F. Discount Rate <br />Long -Term Expected Real Rate <br />of Return <br />5.10% <br />5.90% <br />0.75% <br />5.90% <br />-% <br />The discount rate used to measure the total pension liability in 2019 was 7.5%. The projection of cash <br />flows used to deteiniine the discount rate assumed that contributions from plan members and employers <br />will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net positions of <br />GERF and PEPFF were projected to be available to make all projected future benefit payments of current <br />plan members. Therefore, the long-teini expected rate of return on pension plan investments was applied <br />to all periods of projected benefit payments to deteiniine the total pension liability. <br />G. Pension Liability Sensitivity <br />The following presents the City's proportionate share of the net pension liability for all plans it participates <br />in, calculated using the discount rate disclosed in the preceding paragraph, as well as what the City's <br />proportionate share of the net pension liability would be if it were calculated using a discount rate 1 <br />percentage point lower or 1 percentage point higher than the current discount rate: <br />The City's Proportionate <br />Share of the GERF Net <br />Pension Liability: <br />The City's Proportionate <br />Share of the PEPFF Net <br />Pension Liability: <br />1% Decrease in Current 1% Increase in <br />Discount Rate Discount Rate Discount Rate <br />(6.5%) (7.5%) (8.5%) <br />$4,817,175 <br />$5,424,284 <br />H. Pension Plan Fiduciary Net Position <br />$2,930,253 $1,372,220 <br />$2,481,585 $48,021 <br />Detailed information about each pension plan's fiduciary net position is available in a separately -issued <br />PERA financial report that includes financial statements and required supplementary infoiniation. That <br />report may be obtained on the Internet at www.mnpera.org. <br />85 <br />