2005 Performance Based Budget - Laserfiche WebLink

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on apay-as-you-go basis. As part of the police and firefighters pension reform legislation in 1977, the State created a pension relief fund. The State distributions from this fund are to provide assistance to cities in meeting their employers' cantributinn requirements on a pay-as-you-go basis for these pension plans. Funding for this pension relief is provided by the state utilizing cigarette tax, liquor excise tax and other state revenue. This state pension relief revenue, along with City property taxes and employee contributions, was used to fund the City's current pension payments. However, due to the increased number of retirees that were employed prior to 1977, the pension payments were growing at a faster pace than the revenues supporting these payments. As a result, the Police and Fire Pension Fund balances were expected to be fully utilized by as early as 2001. It was necessary to begin to utilize General Fund dollars to support these two pension fiznds starting in 2000. The enaction of two new State pension laws, described earlier, in 2001 will have an effect on any amount transferred from General Fund to support the Pension Funds. The 2002 Budgeted interfund transfers from the General Fund ($840,000 to the Police Pension Fund and $459,000 to the Fire Pension Fund), were not necessary due to the one time "catch-up" funding from the State Pension Relief Funds in 2002. However, these "catch-up" dollars have quickly been used up and additional General Fund transfers are will be needed for 200b and 2007. The estimates of the interfund transfers for both Fire and Police Pension are $1.3 million for 2006 and $3.8 million for 2007. ~ The new state law that was passed in early 1498 has had the effect of shifting the responsibility for pension payments for certain police and firefighters from the City's pay- as-you-go pension plan to the State's 1977 Pension Plan. The pensioners that are impacted are those police and firefighters that have retired (or became disabled} before July 1, 1998 and have already opted to convert to the 1977 fund when the fund was established (even though the City was still financially responsible for all pension payments for those that had chosen to convert to the new plan). The City estimates that this change in pension payment responsibility will save the City approximately $1.5 million on an annual basis during the lifetime of those affected pensioners and their dependents. At this tune, the City does not know how this bill will impact the state pension relief funds the City anticipates to receive in the years to come. Following this Executive Summary, the reader will find the 2005 Budget Summary, along with each fund's projected annual revenue. A fund description summary precedes the 2005 Expenditure Budget by major classification as it was adopted by the City's Common Council. Following the 2045 Budget by Fund, a historical comparison of each fund's revenue and expenditures for the years 2002, 2003, and 2004 along with the 2004 original (i.e., excluding additional appropriations approved during the year} budget, will provide the reader with a broad view of the City's financial trends. Also included in this section is a multi-year forecast of revenue and expenditures for the City's budgeted funds. This has been provided, along with an explanation of the general assumptions used, in order to give the reader a better understanding of the City's projected financial future. This section ends with a personnel summary that provides historical data on staffing levels for the past three years. B-1 l