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Based on the recent actuarial report completed by the System’s actuary, the pension benefit funded ratio has increased from 86.6% to 91.5%. The combined funded ratio for pension and health benefits is 85%, up from 80.8% the previous year. This marks the second consecutive year that the combined funded ratio has increased for the System.



Every year a valuation of the LAFPP fund is performed by an actuary.&nbsp; The valuation reports the System’s assets and liabilities and establishes the City’s contribution to the fund for each fiscal year.&nbsp; The positive outcome for the year ending June 30, 2015 was the result of approximately $861 million in net actuarial gains for the year. The City’s combined contribution rate for July 15, 2016 will decrease by 1.97% of sworn payroll, from 46.51% to 44.54%. This contribution rate decrease is due to lower than expected COLA increases for retirees, beneficiaries and DROP members, lower than expected salary increases for active members, and a higher than expected rate of return on the valuation value of assets (after smoothing). The overall unfunded liabilities have decreased from $4.0 billion to $3.2 billion.



On a market value basis, the combined funded ratio is 88%, with retirement benefits funded at 94.6% and health subsidy benefits at 46.9%.



For additional information, please <a href="https://content.lafpp.com/wp-content/uploads/2023/06/11192015-agenda-rpts.pdf" target="_blank" rel="noreferrer noopener">click here</a> to view the actuarial report and presentation.

Pension Funded Ratio Increases To 91.5%

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