2019 Comprehensive Annual Financial Report (CAFR)

Law Enforcement Officers Special Separation Allowance (LEOSSA) Plan Description The City is the administrator of a single-employer, defined benefit, retirement system (Separation Allowance) established by the City to provide special separation benefits to its law enforcement officers, as required by state law. Qualified sworn City law enforcement officers are covered by the Separation Allowance. At December 31, 2017, the date of the latest actuarial valuation, the Separation Allowance’s membership consisted of:

Retirees currently receiving benefits Inactive plan members entitled to but not yet receiving benefits

143

-

Active plan members

648 791

Total

The Separation Allowance provides separation benefits to all full-time City law enforcement officers who meet the following requirements: (1) Have (i) completed 30 or more years of creditable service or, (ii) attained 55 years of age and completed 5 or more years of creditable service; and (2) Have not attained 62 years of age; and (3) Have completed at least 5 years of continuous service as a law enforcement officer immediately preceding a service retirement The qualified law enforcement officers are entitled to an annual retirement benefit of 0.85% of the annual equivalent of the base rate of compensation most recently applicable to the covered employee for each year of creditable service. The retirement benefits are paid semi-monthly in equal installments. Payments to retired officers cease at their death or on the last day of the month in which the officer attains 62 years of age or upon the first day of reemployment by any State department, agency, or institution. Article 12D of G. S. Chapter 143 assigns the authority to establish and amend benefit provisions to the North Carolina General Assembly. The retirement benefits are not subject to any increases in salary or retirement allowances that may be authorized by the General Assembly. Management of the Separation Allowance is vested in three Trustees, the City Manager, the Director of Finance and the Director of Human Resources, appointed by the City Council. The Separation Allowance has a June 30, 2019 year end and does not issue a separate stand-alone financial report and is included in the City’s Comprehensive Annual Financial Report as a Pension Benefit Trust Fund. Summary of Significant Accounting Policies For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions and pension expense, information about the fiduciary net position of the Separation Allowance and additions to/deductions from the Separation Allowance’s fiduciary net position have been determined on the same basis as they are reported by the Pension Trust Fund, that is using the full accrual basis of accounting. Employer contributions to the Separation Allowance are recognized when due and when the City has made a formal commitment to provide the contributions. Benefits are recognized when due and payable in accordance with the terms of the Separation Allowance. Investments are reported at fair value. Contributions The City is required by Article 12D of G.S. Chapter 143 to provide these retirement benefits and has chosen to fund the amounts necessary to cover the benefits earned on a pay as you go basis through appropriations made in the General Fund operating budget and to also advance fund amounts as available. Contributions are not required to be made by employees, and as such, there were none. The City’s obligation to contribute to this plan is established and may be amended by the North Carolina 37uu