Ordinance 2024-611 - Laserfiche WebLink

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CITY OF SUNNY ISLES BEACH, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2023 NOTE 7 — EMPLOYMENT RETIREMENT SYSTEM (CONTINUED) HIS PLAN (CONTINUED) Actuarial Assumptions The total pension liability in the July 1, 2022 actuarial valuation was determined using the following actuarial assumptions, applied to all periods included in the measurement: Inflation 2.40% Salary increases 3.25%, average, including inflation Municipal bond rate 3.65% Mortality rates were based on the Generational PUB -2010 with Projection Scale MP -2018 tables. Because the HIS Program is funded on a pay-as-you-go basis, no experience study has been completed for that program. The actuarial assumptions that determined the total pension liability for the HIS Program were based on certain results of the most recent experience study for the FRS Pension Plan. The municipal rate used to determine total pension liability was increased from 3.54% to 3.65%. Discount Rate The discount rate used to measure the total pension liability was 3.65%. In general, the discount rate for calculating the total pension liability is equal to the single rate equivalent to discounting at the long-term expected rate of return for benefit payments prior to the projected depletion date. Because the HIS benefit is essentially funded on a pay-as-you-go basis, the depletion date is considered to be immediate, and the single equivalent discount rate is equal to the municipal bond rate selected by the HIS Plan sponsor. The Bond Buyer General Obligation 20 -Bond Municipal Bond Index was adopted as the applicable municipal bond index. Sensitivity of the City's Proportionate Share of the Net Position Liability to Changes in the Discount Rate The following represents the City's proportionate share of the net pension liability calculated using the discount rate of 3.65%, as well as what the City's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1 - percentage -point lower (2.65%) or 1 -percentage -point higher (4.65%) than the current rate: Current 1% Discount 1% Decrease Rate Increase (2.65%) (3.65%) (4.65%) City's proportionate share of the net pension liability $ 9,449,742 $ 8,283,116 $ 7,316,061 •1