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B. Funding Policy CITY OF RAMSEY Notes to Financial Statements (continued) December 31, 2000 NOTE 8 — DEFINED BENEFIT PENSION PLANS — STATEWIDE (CONTINUED) Minnesota Statutes Chapter 353 sets the rates for employer and employee contributions. These statutes are established and amended by the state legislature. The City makes annual contributions to the pension plans equal to the amount required by state statutes. PERF Basic Plan members and Coordinated Plan members are required to contribute 8.75% and 4.75 %, respectively, of their annual covered salary. PEPFF members are required to contribute 6.2% of their annual covered salary. The City of Ramsey is required to contribute the following percentages of annual covered payroll: 11.43% for Basic Plan PERF members, 5.18% for Coordinated Plan PERF members, and 9.3% for PEPFF members. The City's contributions to the Public Employees Retirement Fund for the years ending December 31, 2000, 1999, and 1998 were $64,912, $59,821, and $50,503, respectively. The City's contributions to the Public Employees Police and Fire Fund for the years ending December 31, 2000, 1999, and 1998 were $83,250, $76,750, and $79,896, respectively. The City's contributions were equal to the contractually required contributions for each year as set by state statute. NOTE 9 - DEFINED CONTRIBUTION PENSION PLAN - FIRE RELIEF ASSOCIATION A. Plan Description Volunteer fire fighters of the City of Ramsey are members of the Ramsey Fire Fighter's Relief Association. The Association is a single- employer defined contribution pension plan that operates under the provisions of Minnesota State Statutes § 69 and 424, as amended. It is governed by a Board of six officers and trustees elected by the members of the Association for three year terms. The chief of the Ramsey Volunteer Fire Department, the Mayor, and the Finance Director of the City of Ramsey are ex -officio members of the Board of Trustees. The City's payroll for members of the Relief Association for the year ended December 31, 2000, was $97,780 compared to a total City payroll of $2,545,581. For financial reporting purposes, the Association's financial statements are not included in the City of Ramsey's financial statements because the Association is not a component unit of the City. The Relief Association issues a publicly available financial report. A copy of the report may be obtained at Ramsey City Hall, 15153 Nowthen Boulevard, Ramsey, Minnesota, 55303. B. Pension Benefits Minnesota State Statutes Chapters 424 and 424A authorize pension benefits for volunteer fire relief associations. In order to be entitled to a pension benefit, a fire fighter must have completed a minimum of 10 years of service with the Department, 10 years membership in the Association, and attain the age of 50 years. The fire fighter will then be 60% vested with every year after that at 4% per year until the 20th year when 100% vesting will occur. Because this plan is a defined contribution plan, the amount of the retirement benefit is not predetermined, but rather is based on the individual member's allocable portion of contributions made during the participation period.