Sec. 28. Pension accumulation fund.
28.1.
a. The pension accumulation fund is hereby continued. It shall be the fund in which shall be accumulated the contributions made by the City to the Retirement Plan, and from which shall be made transfers to the pension fund, as provided in this Section.
b. Upon the basis of such mortality and other tables of experience, and regular interest, as the Retirement Board shall from time to time adopt the actuary shall annually compute (1) the actuarially-required pension reserves for pensions being paid retirants and beneficiaries, and (2) the actuarially-required pension reserves for service rendered and to be rendered by members. The pension reserves so computed shall include the reserves already held in (and to be deposited in) the employees’ savings fund and the pension accumulation fund for purposes of the calculation of the annual contributions determined under this Section. The actuarially-required pension reserves shall be financed jointly by the City and members by annual contributions determined by the Retirement Board in accordance with the provisions of paragraphs (1) and (2) below:
(1) The total required annual contribution to the Retirement Plan for members’ current and accrued service, as well as for pensions being paid retirants and beneficiaries, shall be calculated as follows:
(i) an amount which if paid annually during the members’ future service is expected to be sufficient to provide the actuarially-required pension reserves at the time of their retirements for the portions of the pensions to be paid them based upon their future service; plus
(ii) an amount which if paid annually over a period of years, to be determined by the Retirement Board, will amortize at regular interest the actuarially-required pension reserves (to the extent not funded by current assets), if any, for the accrued service portions of the pension to be paid members upon their retirements and pensions being paid retirants and beneficiaries.
(2) Once calculated, the total required annual contribution to the Retirement Plan described in subparagraph (b)(1) above will be stated in the form of a percentage of members’ projected annual compensations for the applicable fiscal year (the "Projected Percentage"). The total required annual contribution will then be paid to the Retirement Plan by both the City and members as follows:
(i) Each Tier 1 Member will pay to the Retirement Plan 5 percent of his annual compensation.
(ii) Each Tier 2 Member and Tier 3 Member will pay to the Retirement Plan a percentage of his annual compensation equal to one-half of the Projected Percentage, but, as of the start of the first full pay period after January 1, 2016, such percentage shall not exceed 11 percent of the member’s annual compensation (i.e., if one-half of the Projected Percentage is 11 percent or less of the member’s annual compensation then the member pays one-half of the Projected Percentage, but if one-half of the Projected Percentage is more than 11 percent of the member’s annual compensation then the member pays only 11 percent of his annual compensation).
(iii) The City will pay to the Retirement Plan (A) one-half of the Projected Percentage of the aggregate compensation of all Tier 2 Members and Tier 3 Members, plus (B) as of the first full pay period after January 1, 2016, if one-half of the Projected Percentage is in excess of 11 percent of members’ projected annual compensations for the applicable fiscal year, the difference between 11 percent of the aggregate compensation of all Tier 2 Members and Tier 3 Members for that fiscal year and one-half of the Projected Percentage of the aggregate compensation of all Tier 2 Members and Tier 3 Members, plus (C) the Projected Percentage less 5 percent (but not less than zero) of the aggregate compensation of all Tier 1 Members.
(iv) If the Projected Percentage is less than 5 percent, each Tier 1 Member will still pay to the Retirement Plan 5 percent of his annual compensation as specified in subparagraph (b)(2)(i) above, however, the Projected Percentage shall be adjusted (but shall not be less than zero) so that 5 percent of the projected aggregate compensation of all Tier 1 Members plus the Projected Percentage times the projected aggregate compensation of all Tier 2 Members and Tier 3 Members equals the total required annual contribution.
c. The Retirement Board shall, in each fiscal year, certify to the City Council the contributions determined in Subsection (b) of this Section and the City Council shall appropriate and the City and members shall pay, within the next fiscal year, the contributions so certified. When paid the contributions from the City shall be credited to the pension accumulation fund. When paid the contributions from members shall be credited to the individual account in the employees’ savings fund of the member from whose compensation said deductions were made in accordance with Section 27.
d. Should the balance in the pension reserve fund be insufficient to cover the pension reserve fund liabilities the amount of such insufficiency shall be transferred from the pension accumulation fund to the pension reserve fund.
e. Upon the retirement of a member, or upon the death of a member if a pension becomes payable on account of his death, the pension reserve for the pension payable, less his balance in the employees’ savings fund at the time of his retirement or death, shall be transferred from the pension accumulation fund to the pension reserve fund.
f. In any fiscal year the City may elect to contribute amounts to the Retirement Plan in excess of the contributions to the pension accumulation fund required pursuant to Section 28.1(b). If the City exercises its right to make additional contributions to the pension accumulation fund pursuant to this subparagraph (f), then the amounts of such additional contributions will not offset or be used to reduce the amount of required contributions from members during the fiscal year in which they are made.
(Election of 3-12-2013, eff. 6-17-2013; election of 8-25-2015, eff. 10-22-2015)