City of Raleigh
The trend information is as follows:
June 30, 2014
June 30, 2015
June 30, 2016
Funded Status and Funding Progress
As of December 31, 2015, the most recent actuarial valuation date, the plan
was 14.5% funded. The actuarial accrued liability for benefits was $195,163,081, and the actuarial value of assets was
$28,387,974, resulting in an unfunded actuarial accrued liability (UAAL) of $166,775,107. The covered payroll
(annual payroll of active employees covered by the plan) was $210,481,133, and the ratio of UAAL to the covered
payroll was 79.2%. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and
assumptions about the probability of occurrence of events far into the future. Examples include assumptions about
future employment, mortality, and healthcare trends. Amounts determined regarding the funded status of the plan
and the annual required contributions of the employer are subject to continual revision as actual results are compared
with past expectations and new estimates are made about the future.
The schedule of funding progress immediately following the notes to the financial statements presents multi‐year
trend information about whether the actuarial value of plan assets is increasing or decreasing relative to the actuarial
accrued liability for benefits over time. Other required supplementary information is included in the required
supplementary financial data.
Actuarial Methods and Assumptions
. Projections of benefits for financial reporting purposes are based on the
substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits
provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and
plan members at that point. The actuarial methods and assumptions used include techniques that are designed to
reduce the effects of short‐term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent
with the long‐term perspective of the calculations.
Supplemental Retirement Plan – Section 401a
The City contributes to a Section 401a Money Purchase Pension Plan for the purpose of providing
supplemental retirement benefits to general employees. This plan is a defined contribution plan and is reported as a
pension trust fund. The City is a trustee of all plan resources. The plan is managed by the City and administered by
Branch Banking and Trust Company with investment options being exercised by employees.
For each eligible employee who contributes a minimum of 1.5% of salary to a Section 457
Supplemental Retirement Plan, the City contributes double this percentage (to a maximum of 3.0%) into the 401a
plan. During fiscal year 2015‐16, the City contributed $3,810,616 to the plan.