HomeMy WebLinkAboutPension Service Company
Augusta Richmond GA
DOCUMENT NAME: 17err,jiDnSer- y \-c.e Lo'rrl Fnj
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DOCUMENT TYPE: '\kfD Y 1-
YEAR: 'Z-CfJO
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BOX NUMBERg
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FILE NUMBER: ) L--}- ,'''2-3
NUMBER OF PAGES: '
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Pensibn.
Serv.ite
I'
Comm~ny
APPROVED
APR 4
2000
(A~.ill!ST~~.oli'L~OIlNTY COMMISSIONl
March 7, 2000
Mr. Lon Morrey
County 1945 County Commission
530 Greene Street, Room 207
Augusta, Georgia 30911
Dear Mr. Morrey:
We are pleased to enclose the January 1, 1999 actuarial valuation report of Augusta-
Richmond County's three funded pension plans.
Augusta-Richmond County is required have actuarial valuations performed at least bi-
annually on these plans to determine required funding levels, These results will be
used to establish the annual ARC funding requirement for the 2000 plan year, as well
as the 2001 plan year (unless subsequent valuations are performed prior to December
31, 2000 and December 3 1, 2001, respectively.
The reports also document the annual pension cost and historical funding schedules
required by Governmental Accounting Standards Board Statement No. 27.
Please call if you have any questions regarding these reports,
Sincerely,
fJJ~
Paul Roberts
Chief Actuary
Enclosure
1100 Circi<: 7S Parkway, Suite 300, Atlanta, Georgia 30339, 770,952,5225, 770,563,9356Jo-" 800,736,7166, e-mail: pensionservice@mindspring.com
A I 1 a n I a
Au s t i 11
B 0 s t () 11
Columbus
Santa Barbara
A Di\';sion oj The Benefit ,l1arketinB Group, Inc.
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
ACTUARIAL V ALUA TION AS OF
JANUARY 1, 1999
CBIZ/PENSION SERVICE COMPANY
1100 Circle 75 Parkway
Suite 300
Atlanta, Georgia 30339
(770) 952-5225
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March 7, 2000
Augusta-Richmond County Pension Committee
Ladies and Gentlemen:
Re: January 1, 1999 Actuarial Valuation for the Augusta-Richmond County
'County 1945 Plan' (the Plan)
This report presents the results of the actuarial valuation of the plan for the 1999 plan
year, based on census information as of January 1,1999,
The primary function of the actu~al valuation report is to document the minimum
required employer contribution to the plan, as well other actuarial calculations and the
basis of the actuarial valuation. The results of this actuarial valuation will also serve as
the basis for the calculation of the annual pension cost and pension obligations
required by the Governmental Accounting Standards Board,
The required contribution for the 1999 plan year is $0. This amount represents 0.0%
of covered payroll. The required contribution rate determined in the prior valuation
was 0.0% of participant payroll.
Georgia law (pL 47-20) sets trurumum funding standards for state and 'local
government-sponsored defined benefit pension plans in Georgia, The results of this
valuation can be used to establish the funding requirement for the 2000 and 2001
calendar years,
The pension plan and the employer are subject to the reporting requirements of
Statements 25 and 27, respectively, of the Governmental Accounting Standards Board
(GASB), GASB 25 defines the financial reporting standards for the pension plan, A
separate report that contains the required GASB 25 current and historical plan
obligations, funding levels, and contribution amounts will be provided at a later date,
1100 Circle 75 Parkway, Suite 300, Atlanta, Georgia 30339, 770,952,5225. 770,563,9356Jax, 800,736,7166, e.mail: pensionservice@mindspring.com
A I I cl n I cl
All S t; n
B () s ton
Columbus
Santa Barbara
A Division oj The Benefit Marketing Group, Inc.
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Augusta-Richmond County
March 7, 2000
Page 2
GASB 27, which is effective for periods beginning after June 15, 1997, defines the
standards of accounting and financial reporting for pension plan costs and obligations
in the county's financial reports. All required GASB 27 information is provided in this
report.
Based on the results of this valuation, the annual pension cost that must be recognized
in the county's financial report equals $0, The annual pension cost will not equal the
State required contribution in all years.
I believe the methods and assumptions used to determine the annual contribution to
the plan are, in the aggregate, reasonable, considering the historical experience of the
plan and reasonable expectations for the future.
CBIZ/Pension Service Company relied on the following information in preparing the
actuarial valuation results presented in this report:
(a) Active and inactive participant census data as of January 1, 1999 provided by
Augusta-Richmond County. Page 3 contains a statistical summary of the
census data.
(b) Plan provisions as of J ailuary 1, 1999 as contained in the plan document
provided to the actuary by Augusta-Richmond County (summary begins on
page 9 of this report).
(c) The value of plan assets as of January 1, 1999 was furnished by the Augusta-
Richmond County Sta,ff and is shown on page 2 of this report. The assets used
for valuation purposes include any contribution receivables due for prior plan
years.
A summary of the actuarial methods and assumptions used in this actuarial valuation
begins on page 8 of this report.
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Augusta-Richmond County
March 7,2000
Page 3
CBIZ/Pension Service Company is available to answer any questions regarding this
report.
Sincerely,
(1J'~
Paul Roberts, EA
Chief Actuary
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
TABLE OF CONTENTS
Development of Annual Contribution
Page 1
Reconciliation of Plan Assets
Page 2
Active and Inactive Participant Statistical Information
Page 3
Information for Financial Statements
Page 4
GASB 27 Notes to Financial Statements
Page 5
GASB 27 Required Supplementary Information:
Schedule of Funding Progress
Page 7
Summary of Actuarial Methods and Assumptions
Page 8
Summary of Main Plan Provisions for Valuation Purposes
Page 9
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I - 5. Employer Contribution as a Percentage of Payroll
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
DEVELOPMENT OF ANNUAL CONTRIBUTION
FOR THE PLAN YEAR ENDING DECEMBER 31, 1999
1. Participant Counts as of January 1, 1999
a. Active Participants
b. Retirees and Disableds
c. Deferred Vested (former employees)
2. Present Value of Future Benefits as of January 1, 1999
a. Active Participants
b. Retirees and Disableds
c. Deferred Vested (former employees)
Total
Actuarial Value of Assets as of January 1, 1999
a, Fund Balance as of the Beginning of the Plan Year
b. Net Contributions Receivable as of the Beginning of the Plan Year
Total
4. Dl~rivation of Required Employer Contribution
a. Present Value of Future Benefit Payments
b. Actuarial Value of Plan Assets
c, Present Value of Future Employee Contributions
d.' Present Value of Future Employer Contributions
= [(a) - (b) - (c)], but not less than $0
e, Present Value of Future Payroll
f Employer's Normal Cost Percentage = [Cd / (e)].
g. Current Active Participants' Payroll
h, Required Employer Contribution = [(f) x (g)]
1
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$ 1,250,930
11,605,253
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$12,856,183
$13,760,620
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$13,760,620
$12,856,183
13,760,620
74,052
0
$ 1,539,100
0,0%
$ 165,910
$ 0
0.0%
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
RECONCILIA nON OF PLAN ASSETS
1. M[arket Value of Plan Assets as of January 1, 1998
$13,711,309
2. Changes in Assets During the Year
a. Employer Contributions
b. Employee Contributions
c, Net Investment Income
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8,604
1,103,426
( 932,192)
( 130,527)
$ 49,311
d.
Benefits Paid
Administrative Fees Paid
Total Changes
e.
f
3. Market Value of Plan Assets as of January 1, 1999
$13,760,620
Contributions Receivable from the County
$ 0
5. Actuarial Value of Assets as of January 1, 1999: (3) + (4)
$13,760,620
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION Pt,AN
ACTIVE AND INACTIVE PARTICIPANT
STATISTICAL INFORMATION AS OF JANUARY 1, 1999
Active Participants
a. Number
b. Average Age
c. Average Service
d. Total Covered Earnings
4
48.5
28.0
$ 165,910
Inactive Participants
1. Retirees (and Beneficiaries)
a. Number
b. Total Annual Benefits
c. Average Annual Benefit
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$ 815,879
$ 18,543
2. Participants with Vested Deferred Benefits
a. Number
b" Total Annual Benefits
c. Average Annual Benefit
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$ 0
$ 0
3. Diisabled Participants Receiving Benefits
a. Number
b. Total Annual Benefits
c. Average Annual Benefit
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$ 0
$ 0
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
INFORMA TION FOR FINANCIAL STATEMENTS
AS OF JANUARY 1, 1999
1. Actuarial Present Value of Accumulated .Plan Benefits
a. Vested
1.
11.
111.
Retirees (and others in pay status)
Deferred Vested (former employees)
Vested Active Participants
Total
$11,605,253
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714,619
$12,319,872
b.
Nonvested
14,343
Total
$12,334,215
, 2.
EITect of Future Salary Increases
$ 201,670
Total Actuarial Accrued Liability (Projected Unit Credit)
$12,535,885
4. Net Assets Available for Benefits (including receivables)
$13,760,620
5. Net Assets in Excess of Actuarial Present Value of
Accumulated Plan Benefits
$1,426,405
6. PJrincipal Actuarial Assumptions
a, Investment Return
b. Rate of Future Salary Increase~
(not applicable to Accumulated Plan Benefits calculations)
8,0%
5.0%
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
GASB 27 NOTES TO FINANCIAL STATEMENTS
FOR THE, YEAR BEGINNING JANUARY 1, 1999
Note X. Pension Plan
The ernployersponsors County 1945 Plan (The Plan), which is a single-employer defined benefit pension
plan.
The Plan provides retirement, disability, and death benefits to plan participants and beneficiaries, as well as
automatic cost-of-living adjustments. The plan was closed to new participants effective September 30, 1975.
The Plan was initially established by Richmond County, prior to its consolidation with the City of Augusta,
The Plan can be amended by the Augusta-Richmond County Commission by passage of a resolution by its
memb{:rs. The Plan is administered by CBIZlPension Service Company,
FundilllK Policy: The employer is required to contribute an actuarially determined amount annually to The
, ,
Plan's trust. The contribution amount is determined using actuarial methods and assumptions approved by
The Plan's trustees and must satisfy the minimum contribution requirement contained in State of Georgia
statutes.
Annual Pension Cost: The employer's annual pension cost and net pension obligation for the pension plan
for the current year were determined as follows:
January 1. 1999
Derivation of Annual Pension Cost
Annual Required Contribution
Interest on Net Pension Obligation
Amortization of Net Pension Obligation
Annual Pension Cost
$
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$
Derivation of Net Pension Oblieation
Annual'Pension Cost for Prior Year
Actual Contributions to Plan for Prior Year
Increase in Net Pension Obligation
Net Pension Obligation as of January 1, 1998
Net Pension Obligation as of January 1, 1999
$
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$
$
$
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
GASB 27 NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR BEGINNING JANUARY 1, 1999
Basis of Valuation:
Current Valuation Date:
Annual Return on Invested Plan Assets
Projected Annual Salary Increases
Expected Annual Inflation
Actuarial Value of Assets
Actuarial Funding Method
The current funding method does not determine an actuarial liability; there was no unfunded~ C:1~
as of January 1, 1999
Trend Information for The Plan
Fiscal Annual Actual Percentage Net
Year Pension County of APC Pension
Beginning Cost (APC) Contribution Contributed Obligation
01/01/1999 $ 0 N/A N/A $ 0
01/01/1998 0 0 0,0% 0
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
SUMMARY OF ACTUARIAL ASSUMPTIONS AND METHODS
Investment Return:
8.0% per annum.
Salary Increases:
Mortality:
Termination:
Disability:
Retirement:
COLA Increases:
Asset Method:
Funding Method:
5.0% per annum.
1983 Group Annuity Mortality Table, sex-distinct male and female rates.
An experience-based, age-related set of rates; sample rates as follows:
Probability Probability
Age of Termination Age of Termination
20 31.4% 40 5.1%
25 16.1% 45 3.1%
30 9.6% 50 0.8%
35 7.0% 55 0,6%
Rates of disability are based on published studies conducted by the Social Security
Administration; sample rates as follows:
Male Probability Female Probability
Age of Disabilitv ' A~e of Disabilitv
20 0.04% 20 0.02%
30 0,10% 30 0,07%
40 0,23% 40 0.18%
50 0.64% 50 0.50%
60 2.24% 60 1.41%
All participants are assumed to retire at age 60, or current age if later.
CPI is assumed to increase 5.0% per annum,
The actuarial value of assets has been set equal to market value,
The aggregate cost method, Under this method, the excess of the present value of
projected future benefits over the actuarial value of assets is spread over the average
future working lifetime of the participants as a level percentage of payroll.
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
SUMMARY OF PLAN PROVISIONS
Effec::tive Date:
March 1, 1945.
Eligible Emplovees:
Service:
Eamin~s:
Employee Contributions:
Hicl1est Eamin~s:
Accrued Benefit:
Nomlal Retirement:
Eligibility
Benefit
Early Retirement:
Eligibility
Benefit
Regular, full-time County employees hired prior to age 35 and before age 60, excluding all
employees hired after 9/30/75 and employees of the Department of Family and Children's
Services, the Department of Health, and the Department of Public Welfare, The plan also
excludes any employee covered by any o~er retirement program to which the County
contributes, including Social Security.
The period of continuous service from date of hire to termination date during which the
participant made any required employee contributions.
Total compensation paid to an employee.
AfteHax contribution of 5.0% of total compensation. Employee contributions will be
accumulated with interest at a rate of 5.0% per annum.
The highest monthly earnings received within the 72-month period immediately preceding
termination of employment.
2.0% of highest earnings times service, but not greater than 60% of highest earnings.
Attainment of age 60.
The accrued benefit as of the date of termination,
The later of attainment of age 50 and completion of 15 years of service.
(a) A deferred benefit commencing at normal retirement equal to the accrued benefit at
termination, or
(b)
an inunediate benefit equal to the accrued benefit at termination, reduced by 5/12%
for each month that payments commence prior to normal retirement.
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
Disability
SuMMARy OF PLAN PROVISIONS
Pre-retirement Death
Post-retirement Death
Vesting Schedule:
Termination:
If the employee has completed at least one year of service and suffers an employment-
related total and permanent disability, benefit equals 50% of highest earnings minus any
Workers' Compensation payments.
If the employee's disability is total and permanent, but is not employment-related, the
employee will receive a return of their contributions with interest, less any payments
received from this plan.
If the employee's disability is temporary, and they have completed 12 years of service and
been disabled for 4 weeks, the benefit equals their accrued benefit, reduced by any
Workers' Compensation payments. Temporary disability is defined as an inability to
, perform job duties.
If death was employment-related, benefit equals 25% of monthly earnings at the time of
death, commencing immediately after Workers' Compensation payments cease. Benefit is
payable until the surviving spouse dies or is remarried or until unmarried children attain
age 18.
If death was not work-related, benefit equals the employee's contributions to the plan with
interest, less any payments received from the plan.
Benefit equals 60% of the participant's retirement benefit, payable until the death or
remarriage of the surviving spouse.
Completed Years
of Service
Vesting
Percentage
0%
50%
60%
70%
80%
90%
100%
<10
10
11
12
13
14
15 or more
,If the parti'cipant has not completed 10 years of service, benefit equals the employee's
contributions with interest.
If the participant has completed at least 10 years of service, a deferred benefit equal to
their accrued. benefit at termination times their vesting percentage, with benefits
commencing at normal retirement.
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AUGUSTA-RICHMOND COUNTY
COUNTY 1945 PENSION PLAN
SUMMARY OF PLAN PROVISIONS
Cost-of-Living:
Annual cost-of-living adjustments are provided, effective each March 1st, equal to the
change in the Coilsumer Price Index during the preceding calendar year, but not to exceed
5.0% in any year.
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
ACTUARIAL V ALUA nON AS OF
JANUARY 1, 1999
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CBIZ/PENSION SERVICE COMPANY
1100 Circle 75 Parkway
Suite 300
Atlanta, Georgia 30339
(770) 952-5225
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March 7,2000
Augusta-Richmond County Pension Committee
Ladies and Gentlemen:
Re: January 1, 1999 Actuarial Valuation for the Augusta-Richmond County
'City 1949 Plan' (the Plan)
This report presents the results of the actuarial valuation of the plan for the 1999 plan
year, based on census information as of January 1,1999.
The primary function of the actuarial valuation report is to document the minimum
required employer contribution to the plan, as well other actuarial calculations and the
basis of the actuarial valuation. The results of this actuarial valuation will also serve as
the basis for the calculation of the annual pension cost and pension obligations
required by the Governmental Accounting Standards Board,
The required contribution for the 1999 plan year is $0. This amount represents 0.0%
of covered payroll. The required contribution rate determined in the prior valuation
was 0.0% of participant payroll.
Georgia law (pL 47-20) sets nurumum funding standards for state and local
government-sponsored defined benefit pension plans in Georgia, The results of this
valuation satisfy the State's funding requirement and can be used to establish the
funding requirement for the 2000 and 2001 calendar years,
The pension plan and the employer are subject to the reporting requirements of
Statements 25 and 27, respectively, of the Governmental Accounting Standards Board
(GASB), GASB 25 defines the financial reporting standards for the pension plan. A
separate report that contains the required GASB 25 current and historical plan
obligations, funding levels, and contribution amounts will be provided at a later date.
1100 Circle 75 Parkway, Suite 300, Atlanta, Georgia 30339, 770,952,5225, 770,563,9356Jax, 800,736,7166, e-mail: pensionservice@mindspring.com
A I 1(/ n I a
Au s tin
B O.'i ton
Columbus
Santa Barbara
A Division of The Benefit Marketin8 Group, Inc.
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Augusta-Richmond County
March 7,2000
Page 2
GASB 27, which is effective for periods beginning after June 15, 1997, defines the
standards of accounting and financial reporting for pension plan costs and obligations
in the county's financial reports. All required GASB 27 information is provided in this
report.
Based on the results of this valuation, the annual pension cost that must be recognized
in the county's financial report equals $0. The annual pension cost will not equal the
State required contribution in all years,
I believe the methods and assumptions used to determine the annual contribution to
the plan are, in the aggregate, reasonable, considering the historical experience of the
plan and reasonable expectations for the future,
CBIZ/Pension Service Company relied on the following information in preparing the
actuarial valuation results presented in this report:
(a) Active and inactive participant census data as of January 1, 1999 provided by
Augusta-Richmond County, Page 3 contains a statistical summary of the
census data.
(b) Plan provisions as of January 1, 1999 as contained in the plan document
provided to the actuary by Augusta-:Richmond County (summary begins on
page 9 of this report).
( c) The value of plan assets as of January 1, 1999 was furnished by the Augusta-
Richmond County Staff and is shown on page 2 of this report, The assets used
,for valuation purposes include any contribution receivables due for prior plan
years,
A summary of the actuarial !TIethods and assumptions used in this actuarial valuation
begins on: page 8 of this report.
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Augusta-Richmond County
March 7, 2000
Page 3
CBIZ/Pension Service Company is available to answer any questions regarding this
report.
Sincerely,
rlJ~
Paul Roberts, EA
Chief Actuary
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
TABLE OF CONTENTS
Development of Annual Contribution
Page 1
Reconciliation of Plan Assets
Page 2
Active and Inactive Participant Statistical Information
Page 3
Information for Financial Statements
Page 4
GASB 27 Notes to Financial Statements
Page 5
GASB 27 Required Supplementary Information:
Schedule of Funding Progress
Page 7
Summary of Actuarial Methods and Assumptions
Page 8
Summary of Main Plan Provisions for Valuation Purposes
Page 9
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AUGUSTA-RICHMOND COUNTY
trty 1949 PENSION PLAN
DEVELOPMENT OF ANNUAL CONTRIBUTION
FOR THE PLAN YEAR ENDING DECEMBER 31, 1999
1. P~lrticipant Counts as of January 1, 1999
a. Active Participants
b. Retirees and Disableds .
175
160
4
c.
Deferred Vested (former employees)
2. Present Value of Future Benefits as of January 1, 1999
a. Active Participants
b, Retirees and Disableds
c. Deferred Vested (former employees)
Total
$26,960,376
34,582,659
3,120
$61,546,155
Market Value of Assets as of January 1, 1999
a. Fund Balance as of the Beginning of the Plan Year
b. Net Contributions Receivable as of the Beginning of the Plan Year
Total
$71,138,815
o
$71,138,815
4. Derivation of Required Employer Contribution
a. Present Value of Future Benefit Payments
b, Actuarial Value of Plan Assets
$61,546,155
66,295,617
3,671,019
c.
Present Value of Future Employee Contributions
Present Value of Future Employer Contributions
= [(a) - (b) - (c)], but not less than $0
Present Value of Future Payroll
Employer's Normal Cost Percentage = [Cd / (e)]
Current Active Participants' Payroll
Required Employer Contribution = [(t) x (g)]
$ 5,794,554
$ 0
d.
e.
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$57,813,100
0.0%
f
g,
h;
Employer Contribution as a Per:c~nta.ge of Payroll
0,0%
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
RECONCILIA nON OF PLAN ASSETS
1. :Market Value of Plan Assets as of January 1, 1998
$66,391,882
2. Changes in Assets Duringthe Yea:r
a. Employer Contributions
b.' Employee Contributions
c. Net Investment Income
o
380,871
7,966,537
( 3,128,560)
( 471,915)
$ 4,746,933
d.
Benefits Paid
Administrative Fees Paid
Total Changes
e.
f
3.' l\1[arket Value of Plan Assets as of January 1, 1999
$71,138,815
Contributions Receivable from the County
$ 0
5. Market Value of Assets as of January 1, 1999: (3) + (4)
$71,138,815
6. Expected Actuarial Value of Assets as of December 31, 1998
$ 65,084,818
7. Actuarial Value of Assets as of January 1, 1999: (6) + 20% x [(5) - (6)]
$ 66,295,617
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
ACTIVE AND INACTIVE PARTICIPANT
STATISTICAL INFORMATION AS OF JANUARY 1, 1999
Active Participants
a. Number
b. Average Age
c. Average Service'
d. Total Covered Earnings
175
43.8
18.8
$5,794,554
Inacti've Participants
1. Retirees (and Beneficiaries)
a, Number
b. Total Annual Benefits
c, Average Annual Benefit
126
$2,443,936
$ 19,396
2. Pllrticipants with Vested Deferred Benefits
a. Number
b. Total Annual Benefits
c. Average Annual Benefit
4
$ 78,575
$ 19,644
3. Disabled Participants Receiving Benefits
a, Number
b, Total Annual Benefits
c, Average Annual Benefit
34
$ 525,036
$ 15,442
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
INFORMATION FOR FINANCIAL STATEMENTS
AS OF JANUARY 1, 1999
1. Aduarial Present Value of Accumulated Plan Benefits
a. Vested
I.
11.
111.
Retirees (and others in pay status)
Deferred Vested (former employees)
Vested Active PartiCipants
Total
$34,582,659
3,120
7,678,776
$42,264,555
b.
Nonvested
2,513,705
Total
, $44,778,260
2. Effect of Future Salary Increases
$6,609,814
Total Actuarial Accrued Liability (Projected Unit Credit)
$51,388,074
4. Nd Assets Available for Benefits (including receivables)
$71,138,815
5. N .~t Assets in Excess of Actuarial Present Value of
A(~cumulated Plan Benefits
$26,360,555
6. Principal Actuarial Assumptions
a. Investment Return
b. Rate of Future Salary Increases
(not applicable to Accumulated Plan, Benefits calculations)
8,0%
5.5%
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
GASB 27 NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR BEGINNING JANUARY 1, 1999
Note X. Pension Plan
The employer sponsors City 1949 Plan (The Plan), which is a single-employer defined benefit pension plan.
The Plan provides retirement, disability, and death benefits to plan participants and beneficiaries, as well as
automatic cost-of-living adjustments. The plan was closed to new participants effective December 31, 1997.
The Plan was initially established by the City of Augusta, prior to its consolidation with Richmond County,
The Plan can be amended by the Augusta-Richmond County Commission by passage of a resolution by its
membc~rs. The Plan is administered by CBIZ/Pension Service Company.
Funding Policy: The employer is required to contribute an actuarially determined amount annually to The
Plan's trust. The contribution amount is determined using actuarial methods and assumptions approved by
The Plan's trustees and must satisfy the minimum contribution requirement contained in State of Georgia
statute:s.
Annual Pension Cost: The employer's annual pension cost and net pension obligation for the pension plan
for the current year were determined as follows:
January 1. 1999
Deriv~lltion of Annual Pension Cost
Annual Required Contribution
Interest on Net Pension Obligation
Amortization of Net Pension Obligation
Annual Pension Cost
$
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$
Deriv~l1tion of Net Pension Obli2ation
Annual Pension Cost for Prior Year
Actual Contributions to Plan for Prior Year
Increase in Net Pension Obligation
Net Pension Obligation as of January 1, 1998
Net Pension Obligation as of January 1, 1999
$
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$
$
$
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
GASB 27 NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR BEGINNING JANUARY 1, 1999
Basis of Valuation:
Current Valuation Date:
Annual Return on Invested Plan Assets
Projected Annual Salary Increases
Expected Annual Inflation
Actuarial Funding Method
January 1, 1999
8.0%
5.5%
5.0%
Aggregate Method
The Actuarial Value of Assets equals the expected actuarial value of plan assets (projected from the most
recent actuarial valuation) plus 20% of the difference between the market value of assets and the expected
actuarial value of assets.
The current funding method does not determine an actuarial liability; there was no unfunded actuarial liability
as of January 1, 1999
Trend Information for The Plan
Fiscal Annual Actual Percentage Net
Year Pension County of APC Pension
Beginning Cost (APC) Contribution Contributed Obligation
01/01/1999 $ 0 N/A N/A $ 0
01/01/1998 0 0 0.0% 0
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
SUMMARY OF ACTUARIAL ASSUMPTIONS AND METHODS
Investment Return:
Salary Increases:
Mortalitv:
Healthy Lives
Disabled Lives
Temlination:
Disabilitv:
Retirement:
COLA Increases:
Asset Method:
Funding Method:
8.0% per annum.
5.5% per annum.
1983 Group Annuity Mortality Table, sex-distinct male and female rates.
1965 Railroad Board Ultimate Mortality Table
An experience-based, age-related set of rates; sample rates as follows:
Probability Probability
Age of Termination Age of Termination
20 6.64% 40 4.04%
25 5.35% 45 3.57%
30 4.93% 50 2.17%
35 4.61% 55 1.38%
Rates of disability are based on published studies cond'.lcted by the Social Security
Administration; sample rates as follows:
Male Probability Female Probability
Age of Disabilitv Age of Disability
20 0:13% 20 0.04%
30 0.21% 30 0.16%
40 0.44% 40 0.39%
50 1.09% 50 0.94%
60 2.90% 60 1.93%
All participants are assumed to retire at normal retirement, or current age if later.
CPI is assumed to increase 4.0% per annum.
The actuarial value of assets has been set equal to the expected actuarial value of
assets plus 20% of the difference between the expected actuarial value and the actual
market value of assets.
The aggregate cost methOd. Under this method, the excess of the present value of
projected future benefits over the actuarial value of assets is spread over the average
future working lifetime of the participants as a level percentage of payroll.
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
SUMMARY OF PLAN PROVISIONS
Effective Date:
March 1, 1949.
Eligible Emplovees:
Service:
Employee Contributions:
Average Earnings:
Accrued Benefit:
Normal Retirement:
Eligibility
Benefit
Early Retirement:
Eligibility
Benefit
Regular, full-time City employees llired after 1949 and before 1987, excluding all
employees of University Hospital, Sinking Fund Commission, the recorder, the assistant
recorder, and elected officials.
The period of continuous County service from date of llire to termination date during
wllich the participant made any required employee contributions.
After-tax contribution of 8.0% of total compensation (5.0% ifllired prior to 7/1/80).
The average annual pay rate during the last three years of employment.
2.15% of average earnings times service (maximum of 30 years), plus
1.5% of average earnings times service in excess of 30 years.
For police and fire employees, the later of attainment of age 55 and completion of 25 years
of service. For all other employees, the later of attainment of age 60 and completion of 25
years of service. If an employee is permanently separated involuntarily by the City,
without fault on the employee's part, normal retirement is the date of termination if they
have completed at least 20 years of service.
The accrued benefit as of the date of termination.
Any date no more than five years prior to normal retirement, after completing at least 20
years of service.
(a) A deferred benefit commencing at normal retirement equal to the accrued benefit at
termination, or
(b) an immediate benefit equal to the accrued benefit at termination, reduced by 0.5% for
each month that payments commence prior to normal retirement.
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
Disabilitv
SuMMARy OF PLAN PROVISIONS
Pre-fl~tirement Death
Vesting Schedule:
Termination:
If the employee's disability occurs after completion of ten years of service, the benefit
equals the accrued benefit minus any Workers' Compensation payments.
If the employee suffers an employment-related disability, the ten year service requirement
is waived and the benefit paid will not be less than 50% of average earnings minus any
Workers' Compensation payments not specifically awarded for medical expenses.
Benefit commences immediately after Board approval of disability.
If death occurs prior to eligibility for plan benefits, benefit is a refund of employee
contributions.
If death occurs after meeting eligibility for benefits but prior to attaining age 55 and
completing ten years of service, benefit equals survivor's portion of a joint and survivor
annuity that is equivalent to the participant's accrued benefit, if elected by the employee.
If the employee "attains age 55 and completes ten years of service prior to death, the
survivor's portion of a 100% joint and survivor annuity, calculated as though he had
retired under that annuity option immediately prior to death.
Attained Age 45 with
at Least Service of
< 15
15
16
17
18
J9
20 or more
Vesting
Percentage
0%
50%
60%
70%
80%
90%
100%
If the participant has not completed 10 years of service, benefit equals the employee's
contributions.
If the participant has completed at least 10 years of service, a deferred benefit equal to
their accrued benefit at termination times their vesting percentage, with benefits
commencing at normal retirement.
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AUGUSTA-RICHMOND COUNTY
CITY 1949 PENSION PLAN
SUMMARY OF PLAN PROVISIONS
Normal Form:
Straight life annuity to the participant.
Cost.-of-Living:
Annual cost-of-living adjustments are provided, effective each April 1st for all benefits in
payment status for at least one year, equal to the change in the Consumer Price Index
during the preceding calendar year, but not to exceed 5.0% in any year without Council
approval. No change will be made if the CPI change is an increase of less than 2.0% or a
decrease of less than 5.0%, though the change will be aggregated with the CPI increase in
future years.
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
ACTUARIAL VALUATION AS OF
JANUARY 1, 1999
CBIZIPENSION SERVICE COMPANY
. 1100 Circle 75 Parkway
Suite 300
Atlanta, Georgia 30339
(770) 952-5225
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March 7, 2000
Augusta-Richmond County Pension Committee
Ladies and Gentlemen:
Re: January 1, 1999 Actuarial Valuation for the Augusta-Richmond County
'County 1977 Plan' (the Plan)
This report presents the results of the actuarial valuation of the plan for the 1999 plan
year, based on census information as of January 1, 1999.
The primary function of the actuarial valuation report is to document the minimum
required employer contribution to the plan, as well other actuarial calculations and the
basis of the actuarial valuation. The results of this actuarial valuation will also serve as
the basis for the calculation of the annual pension cost and pension obligations
required by the Governmental Accounting Standards Board.
The required contribution for the 1999 plan year is $1,124,928. This amount
represents 4.6% of covered payroll. The required contribution rate determined in the
prior valuation was 3.5% of participant payroll.
Georgia law (PL 47-20) sets minimum funding standards for state and .local
government-sponsored defined benefit pension plans in Georgia. The results of this
valuation satisfies the State's funding requirement and can be used to establish the
funding requirement for the 2000 and 2001 calendar years.
The pension plan and the employer are subject to the reporting requirements of
Statements 25 and 27, respectively, of the Governmental Accounting Standards Board
(GASB). GASB 25 defines the financial reporting standards for the pension plan. A
separate report that contains the required GASB 25 current and historical plan
obligations, funding levels, and contribution amounts will be provided at a later date.
1100 Circle 75 Parkway, Suite 300, Atlanta. Georgia 30339, 770.952.5225, 770.563.9356Jox, 800.736.7166, e-mail: pensionservice@minclspring.com
A t I (1 n t (1
Au s tin
B 0 .\' t- () II
Columbus
San t a
Barbara
A Dil'ision oj The Benefit Marketing Group. Inc.
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Augusta-Richmond County
Marclt 7, 2000
Page 2
GASB 27, which is effective for periods beginning after June 15, 1997, defines the
standards of accounting and financial reporting for pension plan costs and obligations
in the county's financial reports. All required GASB 27 inforlnation is provided in this
report.
Based on the results of this valuation, the annual pension cost that must be recognized
in the county's financial report equals $1,124,928. The annual pension cost will not
equal the State required contribution in all years.
I believe the methods and assumptions used to determine the annual contribution to
the plan are, in the aggregate, reasonable, considering the historical experience of the
plan and reasonable expectations for the future.
CBIZ/Pension Service Company relied on the following information in preparing the
actuarial valuation results presented in this report:
(a) Active and inactive participant census data as of January 1, 1999 provided by
Augusta-Richmond County. Page 3 contains a statistical summary of the
census data.
(b) Plan provisions as of January 1, 1999 as contained in the plan document
provided to the actuary by Augusta-Richmond County (summary begins on
page 9 of this report).
(c) The value of plan assets as of January 1, 1999 was furnished by the Augusta-
Richmond County Staff and is shown on page 2 of this report. The assets used
for valuation purposes include any contribution receivables due for prior plan
years.
A summary of the actuarial methods and assumptions used in this actuarial valuation
begins on page 8 of this report.
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Augusta-Richmond County
March 7, 2000
Page 3
CBIZ/Pension Service Company is available to answer any questions regarding this
report. .
Sincerely,
,;;~~
Paul Roberts, EA
Chief Actuary
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
TABLE OF CONTENTS
Development of Annual Contribution
Reconciliation of Plan Assets
Active and Inactive Participant Statistical Infonnation
Infonnation for Financial Statements
GASB 27 Notes to Financial Statements
GASB 27 Required Supplementary Infonnation:
Schedule of Funding Progress
Summary of Actuarial Methods and Assumptions
Summary of Main Plan Provisions for Valuation Purposes
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
DEVELOPMENT OF.ANNUAL CONTRIBUTION
FOR THE PLAN YEAR ENDING DECEMBER 31, 1999
1. Participant Counts as of January 1, 1999
a. Active Participants
b. Retirees and Disableds
c. Deferred Vested (former employees)
2. Present Value of Future Benefits as of January 1, 1999
a. Active Participants
b. Retirees and Disableds
c.
Deferred Vested (former employees)
Total
3. Aduarial Value of Assets as of January 1, 1999
a. Fund Balance as of the Beginning of the Plan Year
b. Net Contributions Receivable as of the Beginning of the Plan Year
Total
4. Derivation of Required Employer Contribution
.a. Present Value of Future Benefit Payments
b. Actuarial Value of Plan Assets
c. Present Value of Future Employee Contributions
d. Present Value of Future Employer Contributions
= [(a) - (b) - (c)], but not less than $0
e. Present Value of Future Payroll
f Employer's Normal Cost Percentage = [(d I (e)]
g. . Current Active Participants' Payroll
h. Required Employer Contribution = [(f) x (g)]
Employer Contribution as a Percentage of Payroll
1
987
51
10
$24,505,256
5,981,173
1,928
$30,488,357
$9,976,793
o
$9,976,793
$30,488,357
9,976,793
9,619,015
10,892,549
$238,008,952
4.6%
$24,454,857
$ 1,124,928
4.6%
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
RECONCILIATION OF PLAN ASSETS
1. l\1[arket Value of Plan Assets as of January 1, 1998
$ 8,236,242
2. Changes in Assets During the Year
a. Employer Contributions
b. Employee Contributions
c. Net Investment Income
897,930
1,057,428
485,952
( 636,954)
( 63,805)
$ 1,740,551
d.
Benefits Paid
Administrative Fees Paid.
Total Changes
e.
f
3. l\1[arket Value of Plan Assets as of January 1, 1999
$9,976,793
Contributions Receivable from the County
$ 0
5. Actuarial Value of Assets as of January 1, .1999: (3) + (4)
$ 9,976,793
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AUGUSTA-RICHMOND COUNTY
COuNTY 1977 PENSION pLAN
ACTIVE AND INACTIVE PARTICIPANT
STATISTICAL INFORMATION AS OF JANUARY 1, 1999
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Active: Participants
a. Number
b. Average Age
c. Average Service
d. Total Covered Earnings
Inactive Participants
1. Rdirees (and Beneficiaries)
a. Number
b. Total Annual Benefits
c. Average Annual Benefit
2. Participants with Vested Deferred Benefits
a. Number
b. Total Annual Benefits
c. Average Annual Benefit
3. Disabled Participants Receiving Benefits
a.
b.
Number
Total Annual Benefits
Average Annual Benefit
c.
3
987
39.2
4.1
$24,454,857
51
$ 391,064
$ 7,668
10
$ 32,648
$ 3,265
$
$
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
INFORMA TION FOR FINANCIAL STATEMENTS
AS OF JANUARY 1, 1999
1. Actuarial Present Value of Accumulated Plan Benefits
a. Vested
I.
11.
Ill.
Retirees (and others in pay status)
Deferred Vested (former employees)
Vested Active Participants
Total
$5,981,173
1,928
5,959,577
$11,942,678
b.
Nonvested
391,923
Total
$12,334,601
2. Effect of Future Salary Increases
$1,803,111
Total Actuarial Accrued Liability (Projected Unit Credit)
$14,137,712
4. NI~t Assets Available for Benefits (including receivables)
$9,976,793
5. Net Assets in Excess of Actuarial Present Value of
Accumulated Plan Benefits
($2,3579808)
6. Pl'incipal Actuarial Assumptions
a. Investment Return
b. Rate of Future Salary Increases.
(not applicable to Accumulated Plan Benefits calculations)
8.0%
5.0%
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
GASB 27 NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR BEGINNING JANUARY 1, 1999
Note X. Pension Plan
The employer sponsors County 1977 ~lan (The Plan), which is a single-employer defined benefit pension
plan.
The Plan provides retirement, disability, and death benefits to plan participants and beneficiaries, as well as
automatic cost-of-living adjustments. The plan was closed to new participants effective December 31, 1997.
The Plan was initially established by the Richmond County Commission, prior to its consolidation with the
City of Augusta. The Plan can be amended by the Augusta-Richmond County Commission by passage of a
resolution by its members. The Plan is administered by CBIZ/Pension Service Company.
Fundi,ng Policy: The employer is required to contribute an actuarially determined amount annually to The
Plan's trust. The contribution amount is determined using actuarial methods and assumptions approved by
The Plan's trustees and must satisfy the minimum contribution requirement contained in State of Georgia
statutes.
Annual Pension Cost: The employer's annual pension cost and net pension obligation for the pension plan
for the current year were determined as follows:
January 1. 1999
Deriv2lltion of Annual Pension Cost"
Annual Required Contribution
Interest on Net Pension Obligation
Amortization of Net Pension Obligation
Annual. Pension Cost
$ 1,124,928
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$ 1,124,928
Derivaltion of Net Pension Obli2ation
Annual Pension Cost for Prior Year
Actual Contributions to Plan for Prior Year
Increase in Net Pension Obligation
Net Pension Obligation as of January 1, 1998
Net Pension Obligation as of January 1,1999
$ 897,930
897,930
$ 0
$ 0
$ 0
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
GASB 27 NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR BEGINNING JANUARY 1, 1999
Basis of Valuation:
Current Valuation Date:
Annual Return on Invested Plan Assets
Projected Annual Salary Increases
Expected Annual Inflation
Actuarial Value of Assets
Actuarial Funding Method
January 1, 1999
8.0%
5.0%
5.0%
Market Value
Aggregate Method
The current funding method does not determine an actuarial liability; there was no unfunded actuarial liability
as of January 1, 1999
Trend Information for The Plan
Fiscal Annual Actual Percentage Net
Year Pension County of APC Pension
Beginning Cost (APC) Contribution Contributed Obligation
01/01/1999 $ 1,124,928 N/A N/A $ 0
01/01/1998 897,930 897,930 100.0% 0
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
SUMMARY OF ACTUARIAL ASSUMPTIONS AND METHODS
Investment Return:
8.0% per annum.
Salaxv Increases:
Mortalitv:
Temunation:
Disabilitv:
Retirement:
COLA Increases:
Asset Method:
Funding Method:
5.0% per annum.
1983 Group Annuity Mortality Table, sex-distinct male and female rates.
An experience-based, age-related set of rates; sample rates as follows:
Probability Probability
Age of Termination Age of Termination
20 31.4% 40 5.1%
25 16.1% 45 3.1%
30 9.6% 50 0.8%
35 7.0% 55 0.6%
Rates of disability are based on published studies conducted by the Social Security
Administration; sample rates as follows:
Male Probability Female Probability
Age of Disabilitv Age of Disabilitv
20 0.04% 20 0.02%
30 0.10% 30 0.07%
40 0.23% 40 0.18%
50 0.64% 50 0.50%
60 2.24% 60 1.41%
All participants are assumed io retire at the earlier of (1) age 65, (2) the later of
attainment of age 62 and the completion of 25 years of service.
CPI is assumed to increase 5.0% per annwn.
The actUarial value of assets has been set equal to market value.
The aggregate cost method. Under this method, the excess of the present value of
projected future benefits over the actuarial value of assets is spread over the average
future working lifetime of the participants as a level percentage of payroll.
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
SUMMARY OF PLAN PROVISIONS
Effe:tive Date:
January 1, 1977.
Eligible Employees:
Service:
Earnings:
Emoloyee Contributions:
Average Earnings:
Accrued Benefit:
Normal Retirement:
Eligibility
Benefit
Early Retirement:
Eligibility
Benefit
Regular, full-time County employees, including employees of the Richmond County Water
and Sewer System, but excluding employees of the Department of Health, the Department
of Family and Children's Services (except those eligible for coverage under the County
Merit System), and any employees covered by the County 1945 Pension Plan.
Years and complete months of County service from the later of January 1, 1977 or the
employee's County employment date, excluding any periods during wllich the employee
did not make any required contributions to the plan. The first three months of County
service are excluded for employees llired after December 31, 1992.
Total compensation paid to an employee, including pre-tax employee contributions to the
plan.
Pre-tax contribution of 4.0% of total compensation. Employee contributions will be
accumulated with interest at a rate of 5.0% per annum.
The average of earnings during the five consecutive calendar years immediately preceding
termination of employment.
1.0% of average earnings times service.
The earlier of (1) attainment of age 65 and (2) the later of attainment of age 62 and the
completion of 25 years of service.
The accrued benefit as of the date of termination.
The later of attainment of age 50 and completion of 15 years of service.
(a) A deferred benefit commencing at normal retirement equal to the accrued benefit at
termination, or
(b) an i mmedJ ate benefit equal to the accrued benefit at termination, reduced by 5/12%
for each month that payments commence prior to normal retirement.
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AUGUSTA-RICHMOND COUNTY
COUNTY 1977 PENSION PLAN
Disabilitv
SuMMARY OF PLAN PRovisIONS
Pre-retirement Death
Vesting Percentage:
Termination:
Normal Form:
Cost--of-Livinl!.:
If the employee suffers an employment-related disability, benefit equals 25% of average
earr1ings minus any Workers' Compensation payments, payable upon approval of
disability.
.If the employee's diSability is not employment-related, benefit equals their vested accrued
benefit at time of disability less any Workers' Compensation payments, payable upon
- ,
If death was employment-related, benefit equals 25% of average earr1ings at the time of
death, commencing immediately after Workers' Compensation payments cease. Benefit is
payable until the surviving spouse dies or remarries, or until unmarried children attain age
18.
If death was not work-related, benefit equals the employee's contributions to the plan with
interest.
0% if less than 5. years of service are completed: otherwise, 100%.
If the participant has not completed 5 years of service, benefit equals the employee's
contributions with interest.
If the participant has completed at least 5 years of service, a deferred benefit equal to their
accrued benefit at termination, with benefits commencing at normal retirement.
Straight life annuity to the participant.
Annual cost-of-living adjustments are provided, effective each March 1st, equal to the
change in the Consumer Price Index during the preceding calendar year, but not to exceed
5.0% in any year.
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