SDCERS Releases June 30, 2013 Actuarial Valuations

Date: Jan 03, 2014

 

 The San Diego City Employees’ Retirement System (SDCERS) today released its annual actuarial valuations as of June 30, 2013 for the City of San Diego (City), the San Diego Unified Port District (Port) and the San Diego County Regional Airport Authority (Airport).
 
The City’s FY 2015 Actuarially Determined Contribution (ADC), formally known as the Annual Required Contribution or ARC, is $263.6 million. The decrease of $11.8 million from the $275.4 paid in FY 2014 was primarily driven by a multi-year freeze on inflationary pay increases through FY 2018 based on negotiated labor agreements. The FY 2015 ADC is due to be paid to SDCERS on or after July 1, 2014.
 
The City’s Unfunded Actuarial Liability (UAL) is $2.2 billion, a decrease of $41.6 million from June 30, 2012. The decrease is primarily due to the multi-year freeze on inflationary pay increases.  Other factors impacting the UAL were reductions in the actuarial discount rate to 7.25 percent and the long-term pay inflation assumption to 3.3 percent, and favorable investment returns versus expected returns. The City’s funding ratio, the ratio of the system’s actuarial value of assets to its actuarial liabilities, was 70.4 percent as of June 30, 2013.
 
The Port’s FY 2015 ADC is $14.3 million, compared to $13.9 million in FY 2014. The driving factor for the ADC increase was the lowering of the actuarial discount rate. The FY 2015 ADC is due to be paid to SDCERS on or after July 1, 2014. As of June 30, 2013, the Port’s UAL was $107.7 million, an increase of $3.5 million. The increase is also primarily due to the lowering of the actuarial discount rate. The UAL increase was partially offset by gains associated with favorable investment returns. The Port’s funding ratio was 73.7 percent as of June 30, 2013, an increase of 1.0 percent.
 
The Airport’s FY 2015 ADC is $3.8 million, compared to $2.9 million in FY 2014. The increase was driven by liability experience losses and the lowering of the actuarial discount rate. The FY 2015 ADC is due to be paid to SDCERS on or after July 1, 2014. The Airport’s UAL is $7.6 million as of June 30, 2013, an increase of $6.2 million. The UAL increase was also due to the liability experience loss and the lowering of the discount rate, both of which were partially offset by favorable investment returns.  The Airport’s funding ratio was 93.4 percent as of June 30, 2013.
 
SDCERS administers defined benefit plans for the City of San Diego, the San Diego Unified Port District, and the San Diego County Regional Airport Authority and provides service retirement, disability retirement, death and survivor benefits to more than 20,000 members. As of September 30, 2013, SDCERS had approximately $6.3 billion in net investments.
 
For additional information, please refer to the actuarial valuations and the corresponding FAQs available here.




Document Under Categories: Actuarial Valuations

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