This Fiscal Note is not an official copy and should not be quoted or cited.
This Fiscal Note is not an official copy and should not be quoted or cited.
Fiscal Note - SB 0925 - St. Louis City Firefighters' Retirement System
COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. NO. 3932-01
BILL NO. Perfected SB 925
SUBJECT: Retirement: Firefighters
TYPE: Original
DATE: March 24, 1998
FISCAL SUMMARY
ESTIMATED NET EFFECT ON STATE FUNDS Net Effect on All State Funds ESTIMATED NET EFFECT ON FEDERAL FUNDS Net Effect on All Federal Funds
FUND AFFECTED
FY 1999
FY 2000
FY 2001 None
$0
$0
$0
Total Estimated
$0
$0
$0
FUND AFFECTED
FY 1999
FY 2000
FY 2001 None
$0
$0
$0
Total Estimated
$0
$0
$0
|
ESTIMATED NET EFFECT ON LOCAL FUNDS | |||
| FUND AFFECTED | FY 1999 | FY 2000 | FY 2001 |
| City of St. Louis | $0 | ($484,000) | ($484,000) |
Numbers within parentheses: ( ) indicate costs or losses
This fiscal note contains 3 pages.
FISCAL ANALYSIS
ASSUMPTION
The Joint Committee on Public Employee Retirement has reviewed this proposal and has determined it does not represent a "substantial proposed change" in future plan benefits as defined in section 105.660(5), RSMo.
Firemen's Retirement System of St. Louis officials obtained an actuarial cost analysis of the provisions of this proposal. That analysis is based on data from the September 1, 1997 actuarial valuation as well as the following assumptions:
The actuary indicates that the cost savings expected due to the decrease in credited service is more than offset by the cost increase expected due to the lump sum payment. They estimate that these changes would result in a net increase in System liabilities of $3,167,000. The unfunded accrued liability would be amortized over 30 years, requiring a yearly payment of $285,000. In addition, the normal contribution to the System would increase by approximately $199,000, for a total annual estimated cost to the City of St. Louis of $484,000 (representing 1.76% of covered payroll).
Officials of the City of St. Louis assume cost figures provided by the System's actuary would represent additional costs to be incurred by the City as a result of this proposal.
Oversight assumes that the contribution for the System's and City's FY 1999 has already been determined; therefore, costs are reflected to the City beginning in FY 2000. Oversight also assumes that since that benefit changes to the Firemen's Retirement System of St. Louis require approval by the City of St. Louis Board of Aldermen before becoming effective, the provisions of
Article X, Section 21 would not apply. Therefore, no potential costs to the state for mandating local costs are reflected.
| FISCAL IMPACT - State Government | FY 1999 | FY 2000 | FY 2001 |
| (10 Mo.) | |||
| $0 | $0 | $0 | |
| FISCAL IMPACT - Local Government | FY 1999 | FY 2000 | FY 2001 |
| (10 Mo.) | |||
| CITY OF ST. LOUIS | |||
| Costs-contributions to Firemen's Retirement | |||
| System of St. Louis | $0 | ($484,000) | ($484,000) |
FISCAL IMPACT - Small Business
No direct fiscal impact to small businesses would be expected as a result of this proposal.
DESCRIPTION
The proposal would allow a retiring member as well as members participating in the deferred retirement option plan (DROP) of the Firemen's Retirement System of St. Louis to elect, in lieu of applying unused sick leave towards creditable service, to receive a lump sum amount equal to the number of unused hours of sick leave multiplied by the member's hourly rate of pay.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Joint Committee on Public Employee Retirement
Firemen's Retirement System of St. Louis
City of St. Louis
Jeanne Jarrett, CPA
Director
March 24, 1998