Pensions

The City of Spring Valley Village has chosen The Texas Municipal Retirement System for its retirement plan. (TMRS) administers a retirement program for 872 Texas cities. TMRS was established in 1947 and is administered in accordance with the Texas Municipal Retirement System Act (Texas Government Code, Title 8, Subtitle G). TMRS is a qualified retirement plan under Section 401(a) of the Internal Revenue Code. The System offers a choice of benefits so that each participating city can design a plan to suit its needs and budget.

TMRS is a statewide retirement system that cities may elect to join
TMRS is a “hybrid” cash-balance defined benefit retirement plan rather than a traditional, formula-based defined benefit plan
TMRS does not receive any state funds and does not administer a health care plan
Benefits are based on a member’s account balance at retirement. The retirement benefit is funded through mandatory employee deposits, city contributions, and investment income

The City of Spring Valley Village has chosen the following benefits that are authorized under the TMRS statute:

Employee Contributions 7% of pay
City Matching Ratio 2 – 1
Vesting Requirements 5 years
Service Retirement Eligibility 5 years, age 60; 25 years, any age
Death Benefits Yes

Pension Plan Summary

TMRS Summary

The funded status represents the ratio of a pension’s assets to its liabilities or obligations. A funded status of 100% means that an entity has exactly enough assets set aside to pay for its future pension obligations at that particular point in time. TMRS employs two separate actuarial valuations under which the funded status is measured – the funding valuation and the Governmental Accounting Standards Board (GASB) 68 valuation. The primary difference between the two calculations is that the assets for purposes of the funding valuation are “smoothed” to lessen the volatility of market fluctuations of investments while the GASB 68 valuation captures the asset market value of a particular moment in time. Over time, the City is working towards a funded status of 100%. As of December 31, 2016, the City is funded as follows as it relates to the TMRS plan:

Funded ratio (Funding Valuation) 95.9%
Funded ratio (GASB 68 Valuation) 94.05%
Amortization Period 27.5 years
Unfunded Amount as a percentage of Covered Payroll 16%

Financials

As of 12/31/16 Valuation

Total Actuarial Liabilities
(Both Valuations):
$10,464,894

Actuarial Assets Total Fiduciary Net Position
Per Funding Valuation: Per GASB 68:
$10,031,552 $9,842,548