Agenda - Council - 06/25/2024 - Laserfiche WebLink

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NOTE 10 — DEFINED BENEFIT PENSION PLANS — STATE-WIDE (CONTINUED) 1. GERF (Continued) • A one-time, non -compounding benefit increase of 2.5% minus the actual 2024 adjustment will be payable in lump sum for calendar year 2024 by March 31, 2024. 2. PEPFF • Additional one-time direct state aid contribution of $19.4 million will be contributed to the Plan on October 1, 2023. • Vesting requirement for new hires after June 30, 2014, was changed from a graded 20-year vesting schedule to a graded 10-year vesting schedule, with 50.0% vesting after five years, increasing incrementally to 100.0% after 10 years. • A one-time, non -compounding benefit increase of 3.0% will be payable in a lump sum for calendar year 2024 by March 31, 2024. • Psychological treatment is required effective July 1, 2023, prior to approval for a duty disability benefit for psychological condition relating to the member's occupation. • The total and permanent duty disability benefit was increased, effective July 1, 2023. G. Discount Rate The discount rate used to measure the total pension liability in 2023 was 7.0%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members and employers will be made at rates set in Minnesota Statutes. Based on these assumptions, the fiduciary net positions of the GERF and the PEPFF were projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. 88