HomeMy WebLinkAbout2005-05-23 05-176 ORDERCOUNCIL
Item No, 05-176
Date: 05-n-05
Item/Subject: ORDER, Eliminating the Designated Fund Balance Reserve Entitled: "MSR5 Consolidated
Flan Reserve"
Responsible Department: Finance
Commentary:
During the mid 19901s, the Maine State Retirement System (MSR5) moved away from indlvidual plate for
each community to a consolidated plan for all members. This change allowed for greater portability by
individual members. In the beginning, the contribution rates averaged 9%. Beginning with FY2000, Me
average contribution rates dropped significantly to around 4.7%. The reduction in rates was primarily
due to investments outperforming actuarial assumptions and actual wage increases being lower than
projected. Realizing that Me possibility ewsbed for the rates to Increase in Me future, a portion of Me
savings achieved through Me lower rates was set aside to offset potential future increases. To date, the
rates have remained stable as investments continue to outperform actuarial assumptions and the wage
and cast of living increases remain below projections. As a result, it has not been necessary m make use
of this reserve.
Therefore, It Is staffs recommendation that the reserve be eliminated and Me balance of funds in the
amount of $475,818 be [rensferretl to the General Fund's Undesignated Fund Balance.
As part of the budget process raw underway, staff anticipates appropriating Me amount transferred into
Me Undesignated Pond Balance for the purpose of continued funding for Me Penobscot River Coal Tar
suit.
This has been reviewed and Is recommended by the France C nnm'Rtae. Zk
Gty Manager
Associated Information:
Legal Approval:
City Ilcitor
Introduced for
X passage
_ First Reading page _ of
Referral
05-1]6
,r AaelgneA to Councilor Cashvell May 23. 2005
CITY OF BANGOR
(TITLE.) ORDER, Eliminating the Designated Fund Balance Reserve Entitled: "MSRS
Consolidated Plan Reserve"
BE Tr ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR, THAT
The Designated Fund Balax Reserve entitled "MSRS Consolidated Plan Reserve," as
originally authorized by Council Order 99-228, is hereby eliminated and the funds
available in that reserve are hereby transferred to the Oity's General Fund Undesignated
Fund Balance.
IN CITY MUNCIL
Nay 23, 2005
Hatim Nade and Seconded
for ge
Passed 0 B 0 I R
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MILE) 11®tootine the Tesl¢ ted I au e
8 serve Nntfrled: 'R6P5 Consolidated Ploo
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