Public Pension

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Table of Contents

• Plan Description
• Benefits Provided
• Employees Covered by Benefit Terms
• Pension Summary
• Contributions
• Investments
• Changes in Fiduciary Net Position
• Reference Documents & Schedules

Plan Description

The City of Waco participates as one of over 900 plans administered by the Texas Municipal Retirement System (TMRS). TMRS is a statewide public retirement plan created by the State of Texas and administered in accordance with the Texas Government Code, Title 8, Subtitle G (TMRS Act) as an agent multiple-employer retirement system for employees of Texas participating cities. The TMRS Act places the general administration and management of the System with a six-member, Governor-appointed Board of Trustees; however, TMRS does not receive any funding from the State of Texas. TMRS issues a publicly available annual comprehensive financial report (ACFR) that can be obtained at www.tmrs.com.

Benefits Provided

The City of Waco has chosen from a menu of plan options as authorized by the TMRS statute. The City of Waco’s plan provides the following benefit level:

Employee Contributions	7% of Pay
City to Employee Matching Ratio	2 to 1
Updated Service Credit Rate	100% repeating transfers
Cost of Living Adjustments	Effective 1/1/24 the City implemented a 30% non-retroactive repeating Cost of Living Adjustment.
Years Required for Vesting	5 Years
Service Retirement Eligibility	5 Years age 60 or 20years any age
Supplemental Death Benefit to Active Employees	No
Supplemental Death Benefit to Retirees	No

All eligible employees of the City are required to participate in TMRS. 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.

Employees Covered by Benefit Terms

At the December 31, 2024 valuation and measurement date, the following employees were covered by the benefit terms:

Inactive employees or beneficiaries currently receiving benefits (Annuitants)	1,264
Inactive employees entitle to but not yet receiving benefits	859
Active employees	1,611
Total	3,734

 

Pension Summary

TMRS provides each of its member cities with two slightly different actuarial valuations which are both reflected below as of December 31, 2024 (TMRS’ year-end is December 31, 2024, and that is the most recent valuation date for which data is available and has been provided to the City). The first is a funding valuation which uses a smoothed actuarial value of assets to calculate the City of Waco’s actuarially determined contribution (ADC) to the plan. The second valuation is provided for Governmental Accounting Standards Board (GASB) Pronouncement 68 financial reporting purposes and reflects the City of Waco’s fiduciary net position based on the market value of its assets on the reporting date. Results of the most recent valuation follows:

Equivalent Single Amortization Period	13.1
Annual Payroll	$125,148,164

12/31/2024

Actuarial Funding Validation	Amount
Actuarial Accrued Liability (AAL)	$710,582,556
Actuarial Value of Assets (AVA)	$600,218,414
Unfunded Actuarial Accrued Liability (UAAL)	$110,364,142
Funded Ratio	84.5%
UAAL as a percentage of covered payroll	88.2%

12/31/2023

GASB 68 Valuation	Amount
Total Pension Liability	$670,319,008
Plan Fiduciary Net Position	$562,142,652
Net Pension Liability (NPL)	$108,176,356
Funded Ratio	83.9%
NPL as a percentage of covered payroll	90.8%

Using both valuation methods, the City’s funded ratio is above 80%. It is important to note that the primary financial objective of TMRS is to achieve the long-term full funding of promised benefits and each calendar year, TMRS informs the City of what its contribution requirements are to achieve this financial objective.

Downloadable Data(XLSX, 18KB)

Contributions

Employees are required to contribute 7% of their annual gross earnings based on the City’s plan provisions. 

Actuarially Determined Contributions

(as a percentage of pay)

Calendar Year	2022	2023	2024	2025	2026
Employee Rate	7.00%	7.00%	7.00%	7.00%	7.00%
City Rate	14.34%	13.67%	13.92%	18.04%	18.13%
Total Actuarially Determined Contributions	21.34%	20.67%	20.92%	25.04%	25.13%

 

Investments

More detailed information regarding investment objectives, policies, and performance of the TMRS pension system can be found at https://www.tmrs.org/investments.php or in the TMRS Annual Financial Report. TMRS’ current assumed rate of return and total fund return at 1 year, 3 years, 5 years, and 10 years, follow:

2024 Investment Results

(TMRS Total Fund Return)

1 Year	5 Years	10 Years
10.41%	6.82%	6.62%

Source: TMRS 2024 Annual Comprehensive Financial Report

Changes in Fiduciary Net Position

The fiduciary net position is the market value of the assets of the trust. For GASB 68 reporting purposes, the City of Waco’s total pension liability is reduced by the fiduciary net position to arrive at the City’s net pension liability. The breakout of the additions to and deductions from the City’s fiduciary net position for the most recent valuation period as of 12/31/2024 follows:

Downloadable Data(XLSX, 26KB)

Reference Documents & Schedules