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City pension receives $118,329.50 in premium tax; $59,003.68 supplemental likely to follow
Summary
Board staff told trustees the fund received a $118,329.50 premium tax distribution and that a supplemental payment of about $59,003.68 may arrive; staff explained the state collects an extra tax on property insurance premiums that is distributed to municipal pension plans and must be remitted to the trust fund.
At the Oct. 7 Firefighters Pension Board meeting, staff reported the pension plan received a premium tax distribution of $118,329.50 and said a supplemental payment of approximately $59,003.68 may be forthcoming.
A staff member explained the money derives from an additional tax collected on property insurance premiums. "For the fire side, there's a, extra tax collected on property insurance premiums within the city ... The insurance carrier has to send that tax to the state," the staff member said, adding that the state prorates and returns remaining funds to municipalities with qualifying local pension plans.
The staff member said those dollars must go into the trust fund and that the check is routed through the city. "By rule, by law ... the check comes to the city. They have 5 days to sign it and send it over to the trust fund. It must go into the trust fund," the staff member said.
How it is allocated within the plan is typically negotiated between the municipality and the firefighters (for example, additional benefits, employer contribution offsets, or a split). The staff member said the June distribution would appear in the next quarterly accounting; the presenter noted the $118,329.50 is for the period described and the supplemental amount is being confirmed.
No formal board action was recorded to reallocate the funds at the meeting; staff said when the supplemental check arrives it will be deposited in the trust fund and accounted for in the next quarterly report.
