Pension Information

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Public Pensions

Texas Municipal Retirement System

The City of Van  participates in the nontraditional, joint contributory, hybrid defined benefit agent multiple-employer pension plan administered by the Texas Municipal Retirement System (TMRS). 

TMRS, an agency created by the State of Texas and administered in accordance with the TMRS Act, Subtitle G, Title 8, Texas Government Code (the TMRS Act), is an agent multiple-employer retirement system for municipal employees in the State of Texas. The TMRS Act places the general administration and management of the System with a six-member Board of Trustees. Although the Governor, with the advice and consent of the Senate, appoints the Board, TMRS is not fiscally dependent on the State of Texas. 

TMRS’s defined benefit pension plan is a tax-qualified plan under Section 401(a) of the Internal Revenue Code. TMRS issues a publicly available annual comprehensive financial report (ACFR)

Benefits Provided

TMRS provides retirement, disability and death benefits. Benefit provisions are adopted by the governing body of the city, within the options available in the state statutes governing TMRS. 


Plan Provisions Summary
Employee Deposit Rate:

7% of pay

Matching Ratio (City to Employee):

2 to 1

Vesting of Benefits:

5 years

Service retirement eligibility:

20 years at any age, 5 years at the age of 60 and above

Updated Service Credit:

100% Repeating Transfers

Annuity Increases (to retirees):

70% of CPI Repeating

Death Benefits:

Yes


Employees Covered by Benefit Terms

At the December 31, 2021 valuation and measurement date, the following employees were covered by benefit terms:

Inactive employees or beneficiaries currently receiving benefits                00

Inactive employees entitled to but not yet receiving benefits                       00

Active employees                                                                                            ___00        

                                 Total                                                                                ___00

Pension Summary

To understand the pension commitments made by government to its employees and how successful it has been in funding those commitments to date, it is important to understand the following:

     Investments – management of the assets/TMRS responsibility.

     Actuarial valuations – calculation of the cost of benefits earned to date/TMRS responsibility.

     Funding – the city’s commitment to make contributions to fund the benefits earned to date/city responsibility.

Information on investment strategies and results are available in the investment section of TMRS’s Annual Comprehensive Financial Report, pages 51-59. 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.

Additional information on actuarial policies including valuations and experience studies validating assumptions used can also be found on pages 62-79 of the Annual Comprehensive Financial Report. If unrealistic 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.

Interested parties should note that TMRS employs two separate actuarial valuations:

  • A funding valuation to calculate the city’s actuarial determined contribution.
  • The Governmental Accounting Standards Board (GASB 68) valuation which is used for financial reporting purposes and is reported in the city’s  Annual Comprehensive Financial Report 

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

  • Equivalent Single Amortization Period: ###
  • Covered Payroll: $####

 

Contributions

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

Investments

View more detailed information about investment objectives, policies and performance of the TMRS pension system or view the TMRS Comprehensive Annual Financial Report PDF.

TMRS Current Assumed Rate of Return = 6.75%

2021 Investment Results – TMRS Total Fund Return

             1 Year                    3 Year                        5 Year                      10 Year

            12.92%                    14.68%                        13.82%                        5.85%

 Source: TMRS 2021 Comprehensive Annual Financial Report 

Rates of return presented are calculated using the time-weighted rate of return methodology based upon market values, and are presented gross of investment management fees.

Reference Documents


Actuarial Valuations – 

2022 Rate Letter (2021 Funding Valuation Summary) PDF

2021 GASB 68 Valuation for City of Van PDF

Prior Years TMRS Rate Letters – Funding Valuations

Prior Years GASB Actuarial Valuations for City of Van

TMRS System Documents –

  • 2021 TMRS Schedule of Changes in Fiduciary Net Position (pages 22-23)

Links to Other Information