2023 Annual Comprehensive Report

Discount rate The discount rate used to measure the total pension liability was 5.50%. The projection of cash flows used to determine the discount rate assumed that contributions from employers will be made at actuarially determined rates each year. Based on these assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of the current plan members. Therefore, the long-term expected rate of return on pension plan investments of 5.50% was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the City’s net pension liability to changes in the discount rate The following presents the City’s net pension liability calculated using the discount rate of 5.50 percent, as well as what the City’s share of net pension liability would be if it were calculated using a discount rate that is one percentage point lower (4.50 percent) or one percentage point higher (6.50 percent) than the current rate:

1%

Discount

1%

Decrease (4.50%)

Rate

Increase (6.50%)

(5.50%)

Net Pension Liability

$

32,348,943

$

29,497,172

$

26,901,217

Changes in the Net Pension Liability

Total Pension

Plan Net Position

Net Pension

Liability

Liability (a) - (b)

(a)

(b)

Balance as of December 31, 2021

$

36,020,258

$

9,285,280

$ 26,734,978

Changes for the year: Service Cost

988,773 1,897,770

988,773 1,897,770

Interest

Difference between expected and actual experience

1,564,864

1,564,864 (3,048,382) 1,354,041

Contributions - employer Net investment income

3,048,382 (1,354,041) (3,030,700) (1,341,487) 7,943,793 (5,128)

Benefits paid

(3,030,700)

Plan administrative expenses

5,128

Net changes

1,420,707 37,440,965

2,762,194

Balance as of December 31, 2022

$

$

$ 29,497,172

3. Supplemental Retirement Income Plan For Law Enforcement Officers All law enforcement officers employed by the City participate in the State of North Carolina Supplemental Retirement Income Plan, a 401(k) defined contribution pension plan, administered by the Department of State Treasurer and a Board of Trustees. Participation begins on the first day of the quarter upon reaching sworn status. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. Article 5 of G. S. Chapter 135 assigns the authority to establish and amend benefit provisions to the North Carolina General Assembly. Article 12E of G. S. Chapter 143 requires that the City contribute each month an amount equal to 5% of each officer’s salary, and all amounts contributed are vested immediately. Also, the law enforcement officers may make voluntary contributions to the plan.

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