I. Employee Retirement Plans - Defined Benefit Plans {Continued)

City Council · 2026-04-21 · agenda_item

This item concerns the City of West Melbourne's employee retirement plans, specifically defined benefit plans and the Florida Retirement System. It details the asset allocation, expected returns, inflation assumptions, and discount rates used for financial reporting. The information presented includes a sensitivity analysis showing how changes in the discount rate could affect the city's net pension liability. This is a financial reporting and actuarial review item, not a construction project. Therefore, there are no direct construction or trade opportunities at this time. Businesses involved in financial planning, accounting, or actuarial services may find this information relevant for understanding the city's financial obligations.

Cash allocation

1.0 %

Cash arithmetic return

3.2 %

Cash geometric return

3.2 %

Fixed income allocation

29.0 %

Fixed income arithmetic return

5.5 %

Fixed income geometric return

5.4 %

Global equity allocation

45.0 %

Global equity arithmetic return

8.5 %

Global equity geometric return

6.9 %

Real estate allocation

12.0 %

Real estate arithmetic return

8.4 %

Real estate geometric return

7.1 %

Private equity allocation

11.0 %

Private equity arithmetic return

12.4 %

Private equity geometric return

8.8 %

Strategic investments allocation

2.0 %

Strategic investments arithmetic return

6.5 %

Strategic investments geometric return

6.1 %

Total allocation

100 %

Assumed Inflation - Mean

2.40 %

Discount rate

6.70 %

Municipal bond rate

5.20 %

Sensitivity analysis 1% decrease discount rate

5.70 %

Sensitivity analysis current discount rate

6.70 %

Sensitivity analysis 1% increase discount rate

7.70 %

Sensitivity analysis HIS Program 1% decrease discount rate

4.20 %

Sensitivity analysis HIS Program current discount rate

5.20 %

Sensitivity analysis HIS Program 1% increase discount rate

6.20 %

Employer's proportionate share of net pension liability (1% decrease)

6,228,174 $

Employer's proportionate share of net pension liability (current discount rate)

3,173,617 $

Employer's proportionate share of net pension liability (1% increase)

612,720 $

Employer's proportionate share of net pension liability HIS Program (1% decrease)

1,831,903 $

Employer's proportionate share of net pension liability HIS Program (current discount rate)

1,624,516 $

Employer's proportionate share of net pension liability HIS Program (1% increase)

1,450,584 $