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Dearborn Heights actuary: general employee pension contribution rises after large salary increases
Summary
An actuarial review presented to the Dearborn Heights City Council shows a roughly $200,000 increase in the city’s general employee pension contribution driven mainly by large pay increases and higher payroll, while the fund’s funded ratio dipped slightly.
Jason Franken, actuary at Foster & Foster, told the Dearborn Heights City Council that the general employee retirement system’s required contribution increased by about $200,000 for the most recent valuation period, primarily because payroll rose substantially.
Franken said the plan’s projected payroll increased from about $6,660,000 to about $7,140,000 and that the larger-than-expected salary increases over the last three years are the main driver of higher pension liabilities and the increased contribution requirement. "I don't think any any need for alarm here," Franken said about the plan's investment returns and overall status.
The report shows two asset measures: a five-year smoothed actuarial…
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