TITLE
A Resolution of the Mayor and City Council of the City of Maricopa, Arizona, approving and adopting a Public Safety Retirement System (PSPRS) Pension Funding Policy. Discussion and Action.
AGENDA ITEM DESCRIPTION
On April 3, 2018 the Arizona House of Representatives approved House Bill 2097 amending, Section 1. Title 38, chapter 5, article 4, Arizona Revised Statue, by adding section 38-863.01 to read:
“ Pension funding policies; employers
A. Beginning on or before July 1, 2019, each governing body of an employer shall annually:
1. Adopt a pension funding policy for the system for employees who were hired before July 1, 2017. The pension funding policy shall include funding objectives that address at least the following:
a. How to maintain stability of the governing body’s contributions to the system.
b. How and when the governing body’s funding requirements of the system will be met.
c. Defining the governing body’s funded ratio target under the system and the timeline for reaching the targeted funded ratio.
2. Formally accept the employer’s share of the assets and liabilities under the system based on the system’s actuarial valuation report.
B. The governing body shall post the pension funding policy on the governing body’s public website.
The purpose of The Funding Pension Policy is to establish the pension funding objectives set by the City Council for the City's pension plan. In 2012, the Governmental Accounting Standards Board (GASB) approved two financial standards; GASB Statement No. 67 (Financial Reporting for Pension Plans) and GASB Statement No. 68 (Accounting and Financial Reporting for Pensions). Prior to these changes, the Annual Required Contribution (ARC) rate was used as a basis for funding decisions. The Government Finance Officers Association (GFOA) recommends the adoption of a pension funding policy and has numerous recommendations regarding the funding of pension plans. The recommendations are incorporated into this policy. ...
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