HomeMy WebLinkAboutItem #36 - Discussion ItemCITY OF MIAMI. FLORIOA
INTEROFFICE MEMORANDUM
TO Howard V. Gary DATE September 15, 1981
City Manager
sU9JECT Pension Funding
FROM REFERENCES
Carlos E. Garcia
Acting Director of ki
ce
ENCLOSURES.
The firm of Edward H. Friend & Company is finalizing the
actuarial report for the funding requirements of the City's
Pension Retirement Plan and System for fiscal year 81-82.
Mr. Edward H. Friend, who is an expert in the pension field,
will be available on the 24th to discuss this report and the
State of Florida requirements for funding pension benefits.
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W,0,-,AP0 H. FRIEND 6 COMPANY
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Chart 3
SCHEMATIC DIAGRAM
ILLUSTRATING THE
DIFFERENCE BETWEEN
LEVEL DOLLAR
AND
INCREASING
AMORTIZATION OF
UNFUNDED ACTUARIAL ACCRUED LIABILITY
September 24, 1981
level
Z AX 'R��'�
dollar `------------- �5�W'
z-------------
schedule I� 4Roy0RZZ0�
RZSZ�G
adopted
schedule
t Amortization Period
Beginning End
Notes: (1) Dotted line (----) reflects a level dollar type amortization
schedule wherein a level dollar amount is set aside each year to
amortize the unfunded actuarial accrued liability (UAAL).
(2) Light portion () of diagonal line reflects period during which
amortization payments are less than interest on the UAAL (and,
accordingly, reflecting the period during which the UAAL continues
to rise; extent of rise diminishes as the payments increase).
(3) Heavy portion (•--) of diagonal line reflects period during which
amortization payments are more than interest on the UAAL; the larger
the difference, the greater the "chunk" of UAAL amortized.
EDWARD H. FRIEND S COMPANY
Chart 4
ADDITIONAL SCHMATICS
i
i
i
. op Percentage of Tax Revenue
Dollar
Contributions
Diagram 1 �•'
Fixed Dollar Payments
Fixed Dollar Payments
Cost as
Percent Percentage of Tax Revenue Payments
of-----—i-----
Diagram 2 Aggregate
Payroll
I�r �♦
Percentage of
Dollar Tax Revenue
Size of
Amortization
Diagram 3
Unfunded �
Actuarial 1
Accrued Fixed
Liability Dollar i
Amortizaition,/
September 24, 1981
EDWARD H. FRIEND 6 COMPANY
Chart 3
a SCHEMATIC DIAGRAM
ILLUSTRATING THE
DIFFERENCE BETWEEN
LEVEL DOLLAR
AND
INCREASING
AMORTIZATION OF
UNFUNDED ACTUARIAL ACCRUED LIABILITY
level 1�
dollar �pATE�
type-- - - - - - - -- - - - -- -p - — - -- - ---- - -- -- - -
schedule Rp40RT�pTy TO
adopted
RISZ�G Zt` Y
schedule
t Amortization Period
Beginning End
Notes: (1) Dotted line (----) reflects a level dollar type amortization
schedule wherein a level dollar amount is set aside each year to
amortize the unfunded actuarial accrued liability (UAAL).
(2) Light portion () of diagonal line reflects period during which
amortization payments are less than interest on the UAAL (and,
_ accordingly, reflecting the period during which the UAAL continues
to rise; extent of rise diminishes as the payments increase).
(3) Heavy portion (a--) of diagonal line reflects period during which
amortization payments are more than interest on the UAAL; the larger
the difference, the greater the "chunk" of UAAL amortized.