CCP 07-27-2010 - Laserfiche WebLink

Home Browse Search

Volunteer Fire Relief Association Report from the Minnesota Office of the State Auditor The primary sources of revenue for relief associations are fire state aid, municipal contributions, and investment earnings. Fire state aid is derived from a two percent tax on insurance premiums and is allocated based on the market value of real property in the fire district and on the population of each fire district. State law requires that fire state aid be used for pension purposes when the firefighters are covered by a pension plan. When a municipality approves a relief association's benefit level, the municipality assumes responsibility for ensuring that the relief association Special Fund has sufficient assets to cover approved benefit levels. Contributions can be made voluntarily by a local municipality or may be required by law based in part on a relief association's financial situation. Relief associations exist to pay retirement, survivor, and disability benefits to members and their beneficiaries. These benefits compensate volunteer firefighters for their service to the community and assist in the recruitment and retention of volunteers. Nearly 84 percent of relief associations in Minnesota are lump sum plans, meaning that they pay benefits as a one-time lump sum payment to members upon their retirement. In lump sum plans, benefits are paid to members based on an annual benefit level in effect at the time of the member's separation from active service and membership. Lump sum plans are the most common plan type because they are generally easier to administer and have fewer associated administrative costs. The Metro Area region's average lump stun benefit level increased by 2.1 percent; New Brighton is seeking only a 1.8% increase. Com arison of the New Brighton Firefighters' Relief Association to other Metro Area lump sum plans: Relief Association Municipal Contributions Pension Amount Funding Ratio Cottage Grove $3,551 $3,600 94% Golden Valley - $6,700 82% Hopkins $32,166 $7,000 80% Inver Grove Heights $28,000 $5,000 105% Little Canada $15,000 $3,100 76% Maplewood $117,600 $5,500 68% North St. Paul $7,502 $3,400 73% Oakdale - $4,650 78% Rosemount $152,000 $6,900 71% St. Anthony $6,000 $2,500 85% Stillwater - $5,000 92% Vadnais Heights $3,600 71% Woodbury $6,720 81% Nei boring Relief Associations with the Plan Types Relief Association Municipal Contributions Yearly Benefit Monthly Benefit Funding Ratio Lake Johanna $76,253 $5,600 $34 78% Roseville $128,975 $3,000 $30 66% Spring Lake Park $259,962 - $34 90% 1000UNCILREPORW2010�Pobik Sdf ,TneRd ffl n.fdL ,d.&c