The City's Pension Plan 

The City of Carrollton is a member of Texas Municipal Retirement System (TMRS) a statewide, multiple employer agent plan.

In an agent plan, each participating government’s pension is centrally administered and governed by state statutes but the assets and related pension liabilities for each government are accounted for separately and any unfunded liabilities are solely the obligation of that government.

Upon retirement, the employee account balance including interest is combined with the employer match to price a lifetime annuity based on the employee’s age at retirement. 

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Plan Provisions Summary 

The City of Carrollton has chosen from a menu of plan options as authorized by the TMRS statute.

Carrollton’s plan provides the following benefit level:

Information on investment strategies and results are available in the investment section of the TMRS’s Annual Comprehensive Financial Report (ACFR). 

If TMRS does not earn its projected rate of return, assets will be less than expected and the City will have to make up the shortfall through increased contributions.

TMRS employs two separate actuarial valuations:

1. Funding Valuation: Used to calculate the City’s actuarially determined contribution.
   
   
2. Governmental Accounting Standards Board (GASB) Valuation (GASB 68): Used for financial reporting purposes and is reported in the City’s Annual Comprehensive Financial Report (ACFR).

The primary difference between the two valuations is that the funding valuation uses a smoothed actuarial value of assets and the GASB 68 valuation utilizes fiduciary net position based on a market value of assets on the reporting date.

• Smoothed Actuarial Value: The average of assets over time
  
  
• Fiduciary Net Position: The exact amount at a specific moment (market value)

Additional information on actuarial policies including valuations and experience studies validating assumptions used can also be found here (pages 7-69).

If unrealistic actuarial assumptions or methodology are used, actual liabilities could be higher than projected and the City would be required to make up the shortfall with additional contributions.

Actuarial Value of Assets vs. Actuarial Accrued Liabilities (5 Year Comparison)

Downloadable Data

Funding

Information on the City’s commitment to fund its pension liabilities and funded status of those liabilities is provided on this page and in the City’s ACFR, located here.

Contributions

The City of Carrollton has a long history of always contributing its actuarially determined contribution and will often contribute more than this amount as it eliminates future interest costs, improves funding percentages, and provides a cushion of protection against rate volatility.

Actuarially Determined Contribution vs.
Actual Total Contribution Rate Over Time
(Fiscal Year 2023)*

*This information comes from RSI section in ACFR report