(a) Adoption of Annual Budget. The Board of Fire and Police Pension Commissioners shall adopt a budget each year setting forth the administration expense for each Tier of the Fire and Police Pension Plan. The budget shall be adopted at a meeting open to the public. At the discretion of the Council, administrative expense, which includes investment management expense, may be paid from the assets of the Plan.
(b) Separate Items of Budget. The Board shall annually prepare and transmit to the Mayor, Council and Controller a budget setting forth the estimated cost of maintaining the Fire and Police Pension Plan. The budget shall include each of the following separate items, whether such item is a positive number or a negative number:
(1) Fire and Police Pension Plan - Tier 1.
(a) A sum equal to that percentage of the salaries of all Tier 1 Members shown in the last actuarial valuation to be required to cover the entry age cost to be paid by the City on account of new entrants into Tier 1. The entry age cost is defined as the level percentage of compensation of new Tier 1 entrants which must be paid into the Plan from their date of entry in order to provide the benefits under the Plan, less the contributions to be made by new entrants during the period of their membership as provided in Section 1324.
(b) A sum, which may be a positive number or a negative number, equal to the dollar amount shown in the last actuarial valuation to be required to amortize the unfunded liabilities of the Plan allocable to Tier 1 for the purpose of preparation of the budget. The unfunded liabilities to be allocated are the present value of all of the assumed obligations under Tier 1 of the Plan, less
(i) the present value of the future contributions to be made by the City under the preceding subsection and by the members under Section 1324, and
(ii) the assets of the Plan allocated for this purpose to the Fire and Police Tier 1 Service Pension Fund and to the Fire and Police Tier 1 General Pension Fund. The amortization period shall be 70 years beginning with the fiscal year 1967-1968.
(c) A sum sufficient to cover the cost, if any, as determined by an actuarial estimate, of benefits granted by the Council under the authority of Section 1330 of Tier 1.
(2) Fire and Police Pension Plan - Tier 2.
(a) A sum equal to that percentage of the salaries of all Tier 2 Members shown in the last actuarial valuation to be required to cover the entry age cost to be paid by the City on account of new System Member entrants into Tier 2. The entry age cost is defined as the level percentage of salary of Tier 2 entrants which must be paid into the Plan from their respective dates of entry in order to provide the benefits pursuant to this Plan, less the deductions to be made from the salaries of new entrants, while they are Tier 2 Members, as provided by Section 1420.
(b) A sum, which may be a positive number or a negative number, equal to that percentage of the aggregate salaries of all members of the Fire Department and of the Police Department who are included under the provisions of Tiers 1, 2, 3 and 4 of this Plan, as shown in the last actuarial valuation required to amortize the unfunded liabilities of the Plan allocable to Tier 2 for the purpose of preparation of the budget, which sum will remain level as a percentage of salary, but which will increase in dollar amount in accordance with the aggregate salary increase assumption. The unfunded liabilities to be allocated are the present value of all of the assumed obligations under Tier 2 of the Plan less:
(i) the present value of the future contributions to be made by the City pursuant to the preceding subsection (2) (a);
(ii) the present value of the deductions to be made from the salaries of the Tier 2 Members; and
(iii) the assets of the Plan allocated for this purpose to the Fire and Police Tier 2 Service Pension Fund and the Fire and Police Tier 2 General Pension Fund.
The amortization period shall be 70 years beginning with the fiscal year 1967-68, except the Board shall assume that the unfunded liabilities of Tier 2 shall be $258,000,000 as of July 1, 1967. Notwithstanding the foregoing, in the event that the unfunded liability as of any fiscal year beginning on or after July 1, 2001 with respect to Tier 2 is greater than zero, the amortization period for such unfunded liability shall be 30 years if less than the period specified in the preceding sentence. The amortization period for any increases in the unfunded liability for any subsequent fiscal year shall be the amortization period of 70 years beginning with the fiscal year 1967-68 or, if shorter, 30 years with respect to increases in unfunded liabilities resulting from amendment to the Plan and 15 years with respect to increases in unfunded liabilities resulting from actuarial experience losses; the amortization period for any decreases in unfunded liabilities shall remain unchanged.
(c) A sum sufficient to cover the cost, if any, as determined by actuarial estimate, of benefits granted by the Council under the authority of Section 1428 of this Tier 2.
(3) Fire and Police Pension Plan - Tier 3.
(a) A sum equal to that percentage of the salaries of all Tier 3 Members shown in the last actuarial valuation to be required to cover the entry age cost to be paid by the City on account of Tier 3 Member entrants into the Fire and Police Pension Plan - Tier 3. The entry age cost being defined as the level percentage of salary of new Tier 3 Member entrants which must be paid into the Plan from their respective dates of entry in order to provide the benefits pursuant to the Tier 3 provisions, less the deductions to be made from the salaries of new entrants while they are Tier 3 Members.
(b) A sum, which may be a positive number or a negative number, equal to that percentage of salaries of all Tier 3 Members shown in the last actuarial valuation to be required to amortize the unfunded liabilities of the Plan allocable to Tier 3 for the purpose of preparation of the budget. The unfunded liabilities to be allocated are the present value of all the assumed obligations under Tier 3 of the Plan less:
(i) the present value of the future contributions to be made by the City under the preceding subsection 3(a);
(ii) the present value of the deductions to be made from the salaries of the Tier 3 Members; and
(iii) the assets of the Plan allocated for this purpose to the Fire and Police Pension Plan - Tier 3.
(c) A sum sufficient to cover the cost, if any, as determined by an actuarial estimate, of benefits granted by the City Council by ordinance as authorized by Tier 3.
(4) Fire and Police Pension Plan - Tier 4.
(a) A sum equal to that percentage of the salaries of all Tier 4 Members shown in the last actuarial valuation to be required to cover the entry age cost to be paid by the City on account of Member entrants into Tier 4. The entry age cost is defined as the level percentage of salary of new Tier 4 Member entrants which must be paid into the Plan from their respective dates of entry in order to provide the benefits pursuant to the Tier 4 provisions, less the deductions to be made from the salaries of new entrants while they are Tier 4 Members.
(b) A sum, which may be a positive number or a negative number, equal to that percentage of salaries of all Tier 4 Members shown in the last actuarial valuation to be required to amortize the unfunded liabilities of the Plan allocable to Tier 4 for the purpose of preparation of the budget. The unfunded liabilities to be allocated are the present value of all the assumed obligations under Tier 4 of the Plan less:
(i) the present value of the future contributions to be made by the City pursuant to the preceding subsection 4(a);
(ii) the present value of the deductions to be made from the salaries of the Tier 4 Members; and
(iii) the assets of the Plan allocated for this purpose to the Fire and Police Pension Plan - Tier 4.
(c) A sum sufficient to cover the cost, if any, as determined by an actuarial estimate, of benefits granted by the Council by ordinance as authorized by Tier 4.
(c) General Obligation of the City. For the purpose of providing funds to meet the budget of the Fire and Police Pension Plan, the Council annually shall provide from revenues available to it, funds sufficient to provide the total amount of all positive items, reduced by the total amount of all negative items, in the budget submitted by the Board, such reduction subject to any restrictions imposed by Section 401(h) of the Internal Revenue Code.
SECTION HISTORY
Amended by: Charter Amendment A § 4, approved June 5, 2001, effective July 10, 2001.