Metro sponsors four defined benefit pension plans. As fiduciaries for the plans, the Board of Commissioners is required to appoint trustees to an administrative pension committee for each plan; oversee the funded status and trustee administration; and approve plan amendments, benefits, funding and investment policy guidelines. The Board of Commissioners authorizes the trustees of the pension committees to As a means to lower Metro’s borrowing costs, when compared against fixed-rate bonds at the time of issuance in November 2002, and to hedge against interest rate volatility, Metro entered into an interest rate swap with two counterparties in connection with the $100 million Series 2002A Variable-Rate Bonds. The intention of the swap was to effectively change Metro’s interest rate on the bonds to a fixed rate of 3.656 %. Under
e swap, Metro paid th
variable payment on 67% of the one-month LIBOR, on the notional amount of $100 million. On May 22, 2006, Metro entered into a forward starting Constant Maturity Swap (CMS), for the notional amount of $100.0 million. Under the 2006 swap, effective December 1, 2006, Metro paid the counterparties a variable payment of 67% of one-
onth LIBOR and received a variable payment based on 6 m
Missouri-Illinois Metropolitan District
Notes to Financial Statements
June 30, 2010 and 2009
administer, construe an iform and nondiscriminatory
manner. T termine eligibility
as administer the plan assets.
the OPEB pl
y single employer
defined ben All Metro full-time
alaried em Plan. Employees who retire
e
or the plans are
All Metro full-time employees who are included in one of the collective bargaining units recognized by Metro are required to participate in the applicable Union Plan. The Union Plans are contributory single employer defined benefit pension plans. Participants must satisfy minimum age and service requirements for retirement and are eligible for a deferred vested pension if they leave the service of the Agency with at least 10 years credited service. The Union Plans are as follows:
1) Bi-State Development Agency Missouri-Illinois Metropolitan District and Division 788 Amalgamated Transit Union, AFL-CIO Employees’ Pension Plan and Agreement (“788 O&M Plan”)
2) Bi-State Development Agency Missouri-Illinois Metropolitan District and Division 788, Clerical Unit, Amalgamated Transit Union, AFL-CIO Employees’ Pension Plan and Agreement (“788 Clerical Plan”)
3) Bi-State Development Agency Missouri-Illinois Metropolitan District and Locals No. 2 and No. 309 of the International Brotherhood of Electrical Workers Employees’ Pension Plan and Agreement (“IBEW Plan”)
he 788 O&M Plan members are eligible for full retirement benefits at (a) age 65, (b) the ompletion of 25 years of credited service or (c) age 55 with 20 years of credited service.
articipants who have attained age 55 with 15 years of credited service may retire and ceive reduced benefits.
nder the 788 Clerical Plan, members are eligible for retirement benefits at (a) age 65 ith 10 years of credited service or (b) the completion of 25 years of credited service. articipants in the Clerical Unit Plan who have attained age 55 with 15 years credited ervice may retire and receive reduced benefits.
d interpret the pension plans in a un
he trustees of the pension committees are authorized to de for benefits under the plans and to construe the plans terms as well
There are no separate audited GAAP-basis reports for the pension plans or an.
The Pension Plan for Salaried Employees of Metro is a noncontributor efit pension plan for salaried employees (“Salaried Plan”). ployees are eligible to participate in the Salaried
s
after attaining the normal service retirement age as defined in the plan, provided th mployees have five years of credited service, are entitled to normal retirement benefits, e
payable monthly for life, based upon final average monthly earnings and years of credited service. Final average monthly earnings are the employee’s average monthly earnings for the three consecutive Plan years preceding cessation of employment producing the highest average. Participants who have attained age 55 and completed ten years of credited service may retire and receive reduced benefits. The Salaried Plan
lso provides death and disability benefits. The amortization periods f a closed. T c P re U w P s
Missouri-Illinois Metropolitan District
Notes to Financial Statements
June 30, 2010 and 2009
he IBEW Plan me 65 with 12 years
ll Union em employee leaves
hly benefit, he or
he is eligib are entitled to a
ach plan statements and
required su ublicly
e Benefits Section, Bi-State
Developmen or by
calling 314-
Total Metro covered payroll for plan years ending in 2010 and 2009 was $82,519,393 and $84,532,419, respectively. Below are the total employees and retirees covered under the Salaried Plan for plan years ending May 31, 2010 and 2009 and for the Union Plans for plan years ending March 31, 2010 and 2009.
Union Plans
Salaried Plan 788 O&M 788 Clerical IBEW Total 2009
T mbers are eligible for retirement benefits at (a) age of credited service or (b) the completion of 25 years of credited service.
ployees are required to contribute each week. If a union rior to being eligible to receive a mont le for a refund of contributions. Upon retirement, employees
has an annual actuarial valuation that includes financial
pplementary information for that plan. The actuarial valuation is p available. Those reports may be obtained from th
t Agency, 707 North First Street, Mail Stop #125, St. Louis, MO 63102, 982-1471.
A
the employment of the Agency p s
benefit, payable monthly for life. The Union Plans also provide survivor and disability benefits. E 2008 2009 2008 2009 2008 2009 2008 2009 2008 Retirees and Beneficiaries 248 200 950 958 61 57 7 3 1,266 1,218 Vested Long-Term Disability Claimants 8 9 10 9 - 7 - 2 18 27 Terminated vested 145 130 36 1 2 - 3 - 186 131 Fully vested active 280 264 862 598 43 31 32 10 1,217 903 Nonvested active 180 210 357 657 9 21 23 43 569 931 Total participants 861 813 2,215 1152,223 116 65 58 3,256 3,210 Changes to prior year reports are based on the latest actuarial reports.
Funding Policy, Annual Pension Cost and Actuarial Assumptions
For the Salaried Plan, Metro contributes the actuarially recommended contribution. For the Union Plans, Metro has agreed within each collective bargaining agreement, to fund 70 percent of the actuarially recommended contribution, with the remaining 30 percent funded from employee contributions. Following is Metro's annual pension cost for the current year and related information for each plan.
Missouri-Illinois Metropolitan District
Notes to Financial Statements
June 30, 2010 and 2009
Union Plans
Salaried Plan 788 O&M 788 Clerical IBEW
Act 09
Contributions
Employee none $ 2,054,808 $ 96,048 $ 54,564
Employer 2,234,053 4,854,000 216,471 125,842
Total contributions made $ 2,234,053 $ 6,908,808 $ 312,519 $ 180,406 Contribution rates (as percent
of covered payroll)
Employee 0.0% 3.9% 5.7% 1.9%
Employer 8.8% 9.3% 13.0% 4.3%
Employer Annual Pension Cost $ 2,234,053 $ 4,854,000 $ 216,471 $ 125,842
Actuarial cost method Projected Unit Entry Age Entry Age Entry Age
Credit Cost *
Amortization method 30 years, * Level dollar, Level dollar, Level dollar,
Level dollar, if fixed period fixed period fixed period
greater than $0
Closed Closed Closed Closed
Remaining amortization period na 24 years 25 years 26 years
Assumed yield, with market value adjustment Assumed yield, with market value adjustment Assumed yield, with market value adjustment Assumed yield, with market value adjustment Act 3.5% 3.5% 3.5% lary increases 4.5% 4.5% 4.5% 4.5% 0.0% 0.0% 0.0% 0.0% * E
Asset valuation method
uarial valuation date Jun 01, 2009 Apr 01, 2009 Apr 01, 2009 Apr 01, 20
uarial assumptions:
Investment rate of return 8.0% 8.0% 8.0% 8.0%
Inflation rate of return 3.5%
Projected sa
Post-retirement benefit increases
Missouri-Illinois Metropolitan District
Notes to Financial Statements
June 30, 2010 and 2009
nnual employer pension cost, percentage of annual employer pension cost contributed and the net pension obligation, for each plan, for the
or which information is available is as follows:
of APC Pension
June 30, * Cost (APC) Contributed Obligation
788 O&M Plan 2008 $ 4,671,805 100% -
2008 $ 229,977 100% -
6,471 100% -
-
-
10 APC to be made in the subsequent fiscal year. * The above pension costs are based upon annual actuarial valu
Three-Year Trend Information
Trend information relating to the a most recent years f
For the Annual Percentage Net
Year Ending Pension
Salaried Plan 2008 $ 1,731,125 100% - 2009 $ 2,234,053 100% - 2010 $ 1,924,943 - - 2009 $ 4,854,000 100% - 2010 $ 4,953,503 - - 788 Clerical Plan 2009 $ 21 2010 $ 223,550 IBEW Plan 2008 $ 191,261 100% - 2009 $ 125,842 100% - 2010 $ 122,475 - - Note: 20 ations.
Missouri-Illinois Metropolitan District
Notes to Financial Statements
June 30, 2010 and 2009
Salaried Plan 788 O&M Plan 788 Clerical Plan IBEW Plan
cent Funded 101.8% 61.5% 60.3% 70.8%
Actuaria lity 80,01 0,13 2,151,016
Actuarial Value of Assets ,9 6,11 ,521,939
Unfunded A ccrue
Liability ( 46,942) $ 5 4 $ 4,020 629,077
Covered Pay 5,982 $ 5 $ 1,671 2,939,269
Ratio of UA ered
Payroll -3.3% % 24 21.4%
Funding Status and Funding Progress
As of the latest actuarial valuation date for each plan funding progress is as follows:
Per l Accrued Liabit $ 47,2 7 $ 154,636,364 $ 1 59 $ 95,099,820 $ 7,473 $ 7,313 $ 1 48,126 $ d ctuarial A UAAL) $ (8 9,536,54 ,160 $ roll AL to Cov 25,46 $ 2,442,843 ,299 $ -113.5 0.5%
The schedule of funding progress, presented as required supplementary information
ted claims incurred but not yet reported (IBNR) (RSI) following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets are increasing or decreasing over time relative to the actuarial accrued liability for benefits.
Other Post-Employment Benefits
In addition to the pension benefits described above, Metro provides post-employment health care benefits to all employees who meet retirement requirements and provide an employee share of premiums. The benefits for union retirees are determined by contractual agreement and the benefits for salaried retirees represent a voluntary payment. As of June 30, 2010 and 2009, 1,107 and 1,090 union and salaried retirees, respectively, met those requirements.
care. Expenditures for post-employment health care benefits are recognized as retirees report Three plan options are offered, and retiree contributions are three-tiered based on retirement date. The retiree contributions range from $2 per monthTier 1 Economy Plan coverage to $304 per month for family Tier 3 Premium Plan coverage. Metro reimburses a minimum of eighty percent of the amount of validated claims for medical and hospitalization costs incurred by retirees and their dependents.
For each retiree eligible for Medicare, Metro’s Plan coordinates benefits with Medi claims and include a provision for estima
to Metro. In addition, some retirees are included in health maintenance organizations for which Metro pays fixed premiums.
Plan Description
Metro Self-Insured Comprehensive Medical Plan is a single-employer healthcare plan. Metro provides healthcare benefits to retirees, their spouses and their eligible dependents, and life insurance benefits to its retirees.
Missouri-Illinois Metropolitan District
Notes to Financial Statements
June 30, 2010 and 2009
Funding Policy
The plan is funded by financing requirements. M
employer and retiree contributions that are pay-as-you-go etro established a trust for future other post-employment
fiscal years 2010 and e $6.8 million and $6.0 illion, respectively.
nts, with an additional amount to prefund enefits as determined annually by Metro. For the fiscal year 2010, Metro contributed nt premiums and an additional $3.1 million
ty years. he following table shows the actuarial assessment of Metro’s annual OPEB cost for the year
thousa
benefits (OPEB) funding above pay as you go methodology. For 2009, Metro expenses under the pay as you go methodology wer m
The contribution requirements of plan members and Metro are established and may be amended by the Board of Commissioners. The required contribution is based upon projected pay-as-you-go financing requireme
b
$9.9 million to the plan, including $6.8 for curre prefund benefits.
to
Annual OPEB Cost and Net OPEB Obligation.
Metro’s annual OPEB cost (expense) is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASBS No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any
nfunded actuarial liabilities (or funding excess) over a period not to exceed thir u
T
and the changes in Metro’s net OPEB obligation. The following table is in nds:
2010 2009
Annual required contribution $ 18,078 $ 18,157
Interest on net OPEB obligation 1,029 -
Adjustment to annual required contribution (1,274) - Annual OPEB cost (expense) 17,833 18,157
Contributions (9,914) (6,008)
Increase in net OPEB obligation 7,919 12,149 Net OPEB obligation—beginning of year 23,650 11,501 Net OPEB obligation—end of year $ 31,569 $ 23,650 Metro
s co
the percentage of annual OPEB cost contributed to the plan, ’s actual contributions under the pay-as-you-go methodology have been favorable mpared to the actuarial estimate for the past two years.
a
Metro’s annual OPEB cost,