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Public Pensions
The City participates as one of 934 plans in the defined benefit cash-balance plan administered by 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 TMRS with a six-member, governor-appointed Board of Trustees; however, TMRS is not fiscally dependent on the State of Texas. TMRS issues a publicly available annual comprehensive financial report (ACFR) that can be obtained at www.tmrs.com.
Pension Summary
TMRS provides each of its member cities with two slightly different actuarial valuations which are both reflected below as of December 31, 2023 (TMRS’ year-end is December 31, 2023, 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 Midland’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 Midland’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 (AAL) | 14.4 | 15.1 |
| Covered Payroll | 72, 134, 713 | 60, 863, 506 |
| Funding Valuation (Smoothed Value) | 12/31/2024 | 12/31/2023 |
| Actuarial Accrued Liability (AAL) | 426, 097, 368 | 404, 839, 099 |
| Actuarial Value of Assets (AVA) | 376, 081, 390 | 357, 230, 062 |
| Unfunded Actuarial Accrued Liability (UAAL) | 50, 015, 978 | 47, 609, 037 |
| Funded Ratio | 88.3% | 88.2% |
| UAAL as a percentage of covered payroll | 69.3% | 78.2% |
| GASB 68 Valuation (Market Value) | 12/31/2024 | 12/31/2023 |
| Total Pension Liability | 426, 097, 368 | 404, 839, 099 |
| Plan Fiduciary Net Position | 387, 366, 713 | 356, 495, 162 |
| Net Pension Liability (NPL) | 38, 730, 655 | 48, 343, 937 |
| Funded Ratio | 90.9% | 88.1% |
| NPL as a percentage of covered payroll | 53.7% | 79.4% |
Using both valuation methods, the City’s funded ratio is above 88%. 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.
Investments
More detailed information regarding investment objectives, policies, and performance of the TMRS pension system can be found at www.tmrs.com 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:
TMRS' Current Assumed Rate of Return = 6.75%
| Plan Year | Investment Income | Employer Contributions | Employee Contributions | Total Additions |
|---|---|---|---|---|
| 2019 | 42,509,375 | 7,358,089 | 3,625,046 | 53,492,510 |
| 2020 | 23,470,380 | 7,814,479 | 3,796,070 | 35,080,929 |
| 2021 | 42,352,873 | 8,336,855 | 4,016,325 | 54,706,053 |
| 2022 | 26,052,046 | 8,037,557 | 3,934,937 | 14,079,552 |
| 2023 | 37,708,884 | 8,771,112 | 4,260,777 | 50,740,773 |
| 2024 | 36,899,669 | 11,022,179 | 5,049,430 | 52,971,278 |