The State acts solely as the administrator and custodian of the assets of the following retirement systems. Although these retirement systems are included as pension trust funds, the State makes no contribution and has no financial liability other than a fiduciary responsibility.
Connecticut Municipal Employees' Retirement System (CMERS)
The system,
a cost-sharing multiple-employer PERS, provides a retirement system for
fire and police personnel as well as general government employees (except
teachers) for any local government authority in the State of Connecticut,
including towns, cities, boroughs, regional school districts, housing
authorities or other special districts, which may elect to participate and is
governed by Sections 7-425 to 7-451 of the Connecticut General Statutes.
As of July 1, l994, there were 7,395 active members and 3,659 retired
members. Municipalities may designate which departments are to be
covered under the CMERS and membership is then mandatory for all regular
full time employees of participating departments except for fire and
police hired after age 55. The pension plan provides pension, death, and
disability benefits. A member may retire after reaching the age of 55 and
having 10 years of continuous service, 15 years of active aggregate
service, or 25 years of aggregate service. The pension benefit for members
not covered by Social Security is 2% of the employee's average final
compensation times years of service, while for members covered by Social
Security, it is 1 and 1/6% of the average of compensation not in excess of
the Social Security taxable wage base for the ten highest paid years of
service plus 2% of that portion of average final compensation in excess of
that used previously, times years of service. Average final compensation
is the average of the three highest paid years of service. The current-
year covered payroll for all participants amounts to $226 million while
the total payroll is unknown.
The entire cost is borne by the participating municipalities and their employees through employee contributions of 2.25% to 5.0% of salary and contribution assessments on participating municipalities ranging from 7.0% to 10.75% of a participant's payroll.
Municipal contributions are redetermined based on annual actuarial studies in order to maintain the fund on a sound actuarial basis. Total contributions made during 1995 amounted to $29.8 million of which $22.2 million was made by the municipalities and $7.6 million by the employees.
The amounts shown as "pension benefit obligations" are standardized measurements that, with some exceptions, must be used by a PERS. The standardized measurement is the actuarial present value of credited projected benefits. This pension valuation method reflects the present value of estimated pension benefits that will be paid in future years as a result of employee services performed to date and is adjusted for the effects of projected salary increases and any step-rate benefits. The measure is independent of the actuarial funding method used to determine contributions to the systems.
Total unfunded pension benefit obligations of the CMERS as of July 1, 1994, is as follows: (amounts expressed in millions)
| Total pension benefit obligation | $620.1 |
| Net assets available for benefits, at cost | 536.0 |
| (market value $651.6) | |
| Unfunded pension benefit obligation | $84.1 |
Historical trend information is presented on pages 80 and 84 in order for a reader to assess the progress made in accumulating sufficient assets to pay pension benefits as they become payable.
Connecticut Probate Judges and Employees' Retirement System
This system provides retirement benefits to Probate Court Judges and employees. As of June 30, 1995, there were 347 active members with 162 retirees and fourteen widows(ers) receiving benefits.
The entire cost is borne by the Probate Courts and their employees through employee contributions of 1.0 to 3.75 percent of earnings and assessments on the various Probate Courts of the State which assessments are to be actuarially determined. Total contributions made by the members amounted to $236 thousand. No contribution was made by the Probate Courts due to the fully funded position of the system for Fiscal year 1994-95. However, Public Act 94-98 changed several plan provisions and the Probate Court system will be required to make future contributions.
As of the latest actuarial valuation, December 31, 1994, the unfunded pension benefit obligation is zero using the Frozen Entry Age Cost Method.
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