Investment return: Funded status impact

ENTERPRISE RISK MEASURE

Proposed Measure

FUND SUSTAINABILITY | Strengthen the long-term sustainability of the pension fund

Item 6b ? Attachment 02 Page 1 of 2

CURRENT STATUS

1 year 6.7%

5 year 5.8%

10 year 9.1%

Most recent reported investment returns

7%

MEASURE DESCRIPTION

Five investment return scenarios from 5 percent to 9 percent are shown to illustrate the resulting estimated PERF funded status over a ten year period. For example, if the target rate of 7 percent is achieved the resulting funded status would be 86 percent. Similarly, if the investment return is 5, 6, 8 or 9 percent each year over the next ten years, the estimated funded status is identified in the funded status column.

Investment return: Funded status impact

PERFORMANCE

100%

Investment Return

9%

Funded Status

99%

PERF FUNDED STATUS

8%

92%

90%

Target

7%

86%

80%

6%

80%

5%

74%

70%

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

10 YEAR VIEW

Action Items Employer education and communication plan

NEXT STEPS

Owner

Deputy Executive Officer, Communications & Stakeholder Relations

Targeted Completion Date Ongoing

ENTERPRISE RISK MEASURE

Proposed Measure

FUND SUSTAINABILITY | Strengthen the long-term sustainability of the pension fund

Item 6b ? Attachment 02 Page 2 of 2

Investment return: Employer contribution rate impact

CURRENT STATUS

1 year 6.7% 5 year 5.8% 10 year 9.1%

Most recent reported investment returns

7%

65% SAFETY

60% 55%

PERFORMANCE

EMPLOYER CONTRIBUTION RATE % OF PAYROLL

MEASURE DESCRIPTION

Five investment return scenarios from 5 percent to 9 percent are shown to illustrate the resulting estimated typical safety and miscellaneous employer contribution rates over a ten year period. For example, if the target rate of 7 percent is achieved the resulting contribution rate would be 50 percent for safety and 26 percent for miscellaneous plans. Similarly, if the investment return is 5, 6, 8 or 9 percent each year over the next ten years, the estimated typical safety and miscellaneous employer contribution rate is identified in the contribution rate column.

50% 45% 40% 35%

MISCELLANEOUS

30%

25%

20%

Investment Contribution

Return

Rate

5%

61%

6%

56%

Target

7%

50%

8%

44%

9%

38%

5%

33%

6%

30%

Target

7%

26%

8%

22%

9%

19%

15%

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

10 YEAR VIEW

Action Items Employer education and communication plan

NEXT STEPS

Owner

Deputy Executive Officer, Communications & Stakeholder Relations

Targeted Completion Date Ongoing

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