Item 6CITEM 6C Ordinance No. 913 2nd Reading: Affecting participation of city employees in the Texas Municipal Retirement System (TMRS) – adopting a 20-year/any age service retirement option;
and prescribing an effective date.
Background
Qualified retirement plan under IRS Code, section 401
Established under Texas Government Code
Plan is city specific within general framework
Service retirement option:
Any age with at least 20 / 25* years of service.
*(Southlake at higher service requirement)
Background
Supports Strategic Objective L3: Attract, develop and retain a skilled workforce
Benchmark group: only one other city requires 25 years of service
Dallas region: 7 of 32 cities* require 25 years
Fort Worth region: 2 of 26 cities* require 25 years
*(cities with 100 or more employees)
Cost of implementation for FY 2008: $43,063
20-year rate 0.29%
TMRS total rate 12.71%
Effects of changing from 25 years to 20 years
Personnel
Other cities experience:
TMRS: actual less than predicted; rates reduced 50% three years after 1996 adoption
Effects of changing from 25 years to 20 years
Cost
TMRS: Southlake historical data suggests minimal future impact
Ordinance No. 913
Adopts 20-year service retirement as provided under Title 8, Texas Government Code
Effective Date of October 1, 2007
Actuarial study completed
Public Hearing -- 2nd reading: September 18, 2007