Financial Report - Moreno Valley

City of Moreno Valley
Notes to Financial Statements
Year Ended June 30, 2011 (Continued)
Note 7: Interfund Receivables, Payables and Transfers (Continued)
The General Fund transferred a total of $2,605,518 to several funds to provide subsidies to
cover the operating deficits.
The Development Impact Fees Fund transferred a total of $4,084,493 to nonmajor
governmental funds for debt service payments and provide support for several capital
projects in the fiscal year.
The Community Redevelopment Agency Debt Service Fund transferred a total of $2,285,357
for debt service payments in the fiscal year. Additionally, the Community Redevelopment
Agency Debt Service Fund transferred $595,863 to the Community Redevelopment Agency
Capital Projects Fund for administrative costs.
Note 8: Employee Pension Plan
Plan Description
The City's defined benefit pension plan, Public Employees Retirement System (PERS),
provides retirement and disability benefits, annual cost-of-living adjustments and death
benefits to plan members and beneficiaries. PERS is part of the Public Agency portion of
the California Public Employees Retirement System (CalPERS), an agent
multiple-employer plan administered by CalPERS, which acts as a common investment
and administrative agent for participating public employers within the State of California.
A menu of benefit provisions, as well as other requirements, is established by state
statutes within the Public Employees' Retirement Law. The City selects optional benefit
provisions from the benefit menu by contract with CalPERS and adopts those benefits
through local ordinance. CalPERS issues a separate comprehensive annual financial
report. Copies of the CalPERS annual financial report may be obtained from the
CalPERS Headquarters, 400 Q Street, Sacramento, California 95811.
Funding Policy
Active plan members in PERS are required to contribute 8.00% of their annual covered
salary as of January 2008. The City is required to contribute the actuarially determined
remaining amounts necessary to fund the benefits for its members. The actuarial
methods and assumptions used are those adopted by the CalPERS Board of
Administration. The required employer contribution rate is 15.505% for fiscal year
2010-2011. The contribution requirements of the plan members are established by state
statute and the employer contribution rate is established and may be amended by
CalPERS.
Annual Pension Cost
For fiscal year 2010-2011, the City's annual pension cost was $5,214,878. The City also
contributed $78,226 on behalf of the employees for the employee contribution. The
required contribution for the fiscal year 2010-2011 was determined as part of the
June 30, 2008 actuarial valuation using the entry age normal actuarial cost method with
the contributions determined as a percent of pay. The actuarial assumptions included:
a) 7.75% investment rate of return (net of administrative expenses), b) projected salary
increases for employees that vary by duration of service ranging from 3.25% to 14.45%
for miscellaneous members, and c) 3.25% cost-of-living adjustment. Both a) and
b) include an inflation component of 3.00%. The actuarial value of PERS assets was
determined using a technique that smoothes the effect of short-term volatility in the fair
value of investments over a 15-year period. The PERS unfunded actuarial accrued
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