San Antonio Fire & Police Pension Fund Fire & Police Pre Funded Health Care Trust Fund

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1 San Antonio Fire & Police Pension Fund Fire & Police Pre Funded Health Care Trust Fund

2 Pension Fund Health Care Fund Established 1919 Codified in Statute 1941 Total Assets $2,464,121,621 Pensioners 2,181 Member Contributions $36,627,810 City Contributions $73,255,620 Total $109,883,430 No Social Security benefits or payments Recognitions: Small Pension Fund of the Year (2013) The best funded pension over $1 billion in Texas Established 1989 Codified in Statute 1997 Total Assets $275,350,365 Insured Families 1,836 Insured Individuals 3,425 Member Contributions $12,640,540 City Contributions $25,281,080 Total $37,921,620 Active Police 2,315 Active Fire 1,641 Total Members 3,956

3 Structure of the Funds Both Funds are structured by state law. Created an independent checks and balance. Changes are made with legislative approval of amendments to the state law. Exception in Retiree Health Care Fund. Both Boards receive input from the City Staff, City Council, Unions, Retirees. Reviewed by Fund s actuaries to assess the impact.

4 Structure of the Funds Continued Reviewed by actuaries at Pension Review Board. Presented to the Pension Committee/ Senate Affairs in order to move into the legislation for a vote. Retiree Health Care Fund subject to Committees established by presiding officer. Proposed changes must then pass both houses to become revised law. 4

5 Structure of the Boards Nine Trustees each board- identical structure established within the law. 4 Active members Two fire and two police representatives 2 Retiree members One fire and one police representatives 3 City council representatives Two current city council members Mayor or his designee

6 Pension Fund Contribution Rates Members 12.32% of payroll City 24.64% of payroll Do not contribute 6.2% into Social Security Consistent Funding Covers Disabilities and line of duty deaths Retiree Health Care Fund Member 4.7% of average base pay + longevity City 9.4% of average base pay + longevity

7 Assumed Rates of Return Pension Fund 7.5% Investment Return 3.5% Inflation Rate Retiree Health Care Fund 8.0% Investment Return 4% Inflation Rate (CPI) 5.5% medical Inflation

8 Pension Fund Returns & Growth 25 Year Average Return = 8.64% Sources: Pension Fund s financial statements

9 Pension Fund Historical Funded Ratio Sources: Pension Fund s financial statements

10 Healthcare Fund Returns & Growth 15 Year Average Return = 5.66% Sources: Healthcare Fund s financial statements

11 Retiree Health Care Fund 12 year Historical Funded Ratio Sources: Healthcare Fund s financial statements

12 Retiree Health Care Fund Cost Per Person 11 Year Average Growth = 5.84% 5 Year Average Growth = 11.23% 6 Year Average Growth = 1.24% Sources: Healthcare Fund s financial statements

13 Asset Allocation as of September 30, 2013 Pension Fund Retiree Health Care Fund Real Assets 5% Private Equity 5% Private Debt 2% International Fixed Income 9% Real Estate 10% Hedge Funds 9% Risk Parity 6% Cash 1% Domestic Equity 22% International Equity 21% Domestic Fixed Income 10% Sources: Pension & Healthcare Funds financial statements

14 Budget vs. Actual Revenues and Transfers $1,000,000,000 $950,000,000 $900,000,000 $850,000,000 $800,000,000 $750,000,000 $700,000,000 $650,000,000 $600,000,000 $550,000,000 $500,000, Budget Revenues and Transfers 584,322, ,732, ,286, ,140, ,040, ,301, ,502, ,148, ,525, ,295, ,150,108 Actual Revenue and Transfers 616,668, ,683, ,631, ,415, ,505, ,396, ,124, ,208, ,511, ,326, ,191,042 Source: COSA's Adopted Budget Reports for and Proposed Budget for

15 Budgeted Appropriations vs Actual Appropriations $1,200,000,000 $1,000,000,000 $800,000,000 $600,000,000 $400,000,000 $200,000,000 $ Budget Appropriations 601,386, ,440, ,170, ,119, ,668, ,549, ,961, ,077, ,845, ,175, ,616,804 Actual Appropriations 597,478, ,393, ,691, ,353, ,290, ,146, ,164, ,387, ,351, ,728, ,253,029 Source: Adopted Budget Reports for ffiscal Years and Proposed Budget for

16 Public Safety As a Percent of General Fund Sources: Comprehensive Annual Financial Reports for Cites Listed

17 Payroll Growth Forecasts Pension Fund assumes a 3.5% growth in Payroll. City has added 1% to account for longevity pay and rank increases. Pension Fund actuaries have indicated that longevity and rank increases is included in the 3.5% assumption.

18 Average Public Safety Salary per Member 10 Year Average Growth Rate = 3.1% Sources: Pension Fund s financial statements

19 Contributions Relative To General Fund Expenses (In Millions) 7.30% 7.87% 2.51% 2.71%

20 Awards and Recognitions 2013 Small Pension Fund of the Year. Money Management Intelligence Recognized by the State Comptroller Susan Combs as a model plan. Best funded plan in the State of Texas greater than 1 billion. Recognized as the most efficient use of tax dollars for a public pension in Texas.

21 Final Points Both Funds are well funded and managed. Help contribute to the City s AAA bond rating Funds are assets to the community and city. Quality Public safety recruitment. Retention to reduce training costs. Long term contract between the city and members who risk their lives for the citizens. Statutory trust representing unanimous consensus of all affected parties.