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HomeMy WebLinkAbout2014 - 27245 LBWL Lansing Board of Water and Light Employees' Defined Contribution Pension Plan 0614 Final Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Financial Report with Supplemental Information June 30, 2014 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Contents Report Letter 1-2 Management's Discussion and Analysis 3-4 Basic Financial Statements Statement of Net Position 5 Statement of Changes in Net Position 6 Notes to Financial Statements 7-12 Supplemental Information 13 Statement of Changes in Net Position by Fund 14-19 Independent Auditor's Report To the Honorable Mayor, Members of the City Council, and Commissioners of the Board of Water and Light Lansing Board of Water and Light Employees' Defined Contribution Pension Plan City of Lansing, Michigan Report on the Financial Statements We have audited the accompanying financial statements of Lansing Board of Water and Light Employees' Defined Contribution Pension Plan (the "Plan") as of and for the years ended June 30, 2014 and 2013 and the related notes to the financial statements, which collectively comprise the Plan's basic financial statements as listed in the table of contents. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control.Accordingly,we express no such opinion.An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. I To the Honorable Mayor, Members of the City Council, and Commissioners of the Board of Water and Light Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the net position of the Lansing Board of Water and Light Employees' Defined Contribution Pension Plan as of June 30, 2014 and 2013 and the changes in its net position for the years then ended, in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matter As discussed in Note I to the financial statements, in 2014, Plan adopted GASB Statement No. 67, Financial Reporting for Pension Plans. Our opinion is not modified with respect to this matter. Other Matters Required Supplemental Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis on pages 3 and 4 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, which considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audits were conducted for the purpose of forming an opinion on the financial statements that collectively comprise the Lansing Board of Water and Light Employees' Defined Contribution Pension Plan's basic financial statements. The statement of changes in net position by fund is presented for purposes of additional analysis and is not a required part of the basic financial statements. The statement of changes in net position by fund is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the statement of changes in net position by fund is fairly stated in all material respects in relation to the basic financial statements as a whole. ! �, PGLC September 2, 2014 2 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Management's Discussion and Analysis Using this Annual Report This annual report consists of two parts: (1) management's discussion and analysis (this section) and (2) the basic financial statements. The financial statements also include notes that explain some of the information in the financial statements and provide more detailed data. Condensed Financial Information The table below compares key financial information in a condensed format between the current year and the prior two years: 2014 2013 2012 Assets held in trust: Mutual funds $ 130,442,786 $ 109,882,178 $ 97,085,185 Stable value 33,607,203 32,243,585 30,547,019 Participant notes receivable and other 5,229,750 4,768,679 4,388,840 Net position $ 169,279,739 $ 146,894,442 $ 132,021,044 Changes in plan assets: Net investment income $ 23,453,570 $ 16,035,621 $ 520,705 Employer and participant contributions 6,521,703 7,889,794 6,633,327 Benefits paid to participants (7,645,1 16) (9,097,209) (1 1,632,674) Loan defaults and other increases 55,140 45,192 104,423 Changes in net position $ 22,385,297 $ 14,873,398 $ (4,374,219) During fiscal year 2014, net investment income was $23.5 million. Investment Objectives The principal purpose of the Plan is to provide benefits at a normal retirement age; the Plan's funds are selected to optimize return on a risk-adjusted basis within each asset class, to provide an opportunity to create a well-diversified portfolio, to control administrative and management cost, and to comply with relevant Michigan and federal law. 3 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Management's Discussion and Analysis (Continued) The Plan allows each participant to direct the investment of the funds in his or her plan accounts. The Lansing Board of Water and Light (the "BWL") will offer various investment options (consistent with the investment policy statement), among which participants may choose to invest their respective interests in the Plan. The BWL periodically reviews the performance of investment options available to participants to ensure that each such option is meeting its investment objectives. Investment Results The fiscal year ended June 30, 2014 saw a net investment income of $23.5 million. Total assets held in trust at the end of the fiscal year were $169.3 million. Future Events The BWL has no current plans to revise the terms of its defined contribution pension plan. Contacting the Plan's Management This financial report is intended to provide a general overview of the Plan's finances and to show accountability for the money it receives. If you have questions about this report or need additional information, we welcome you to contact the office of Susan Devon, Chief Administrative and Technology Officer, at P.O. Box 13007, Lansing, Michigan 48901-3007. 4 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Statement of Net Position June 30 2014 2013 Assets Participant-directed investments (Note 1): Mutual funds: Money market $ 117,793 $ 418,421 Bond and equity funds 16,556,877 16,438,836 Stock funds 60,617,315 51,617,791 Balanced funds 29,495,580 20,394,104 Growth funds 6,144,760 5,736,285 International funds 17,510,461 15,276,741 Total mutual funds 130,442,786 109,882,178 Stable value 33,607,203 32,243,585 Self-directed brokerage account 1,147,041 859,599 Total participant-directed investments 165,197,030 142,985,362 Participant notes receivable 4,082,709 3,909,080 Net Position $ 169,279,739 $ 146,894,442 See Notes to Financial Statements. 5 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Statement of Changes in Net Position Year Ended June 30 2014 2013 Increase Investment income: Net appreciation in fair value of investments $ 17,907,856 $ 12,924,636 Dividend income 5,545,714 3,1 10,985 Total investment income 23,453,570 16,035,621 Employer contributions (Note 1) 5,467,824 5,494,101 Participant rollover contributions 1,053,879 2,395,693 Interest from participant notes receivable 155,997 139,026 Other 114,992 110,424 Total increase 30,246,262 24,174,865 Decrease Benefits paid to participants 7,645,1 16 9,097,209 Loan defaults 119,694 120,280 Participants' note and administrative fees 96,155 83,978 Total decrease 7,860,965 9,301,467 Change in Net Position 22,385,297 14,873,398 Net Position Beginning of year 146,894,442 132,021,044 End of year $ 169,279,739 $ 146,894,442 See Notes to Financial Statements. 6 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Notes to Financial Statements June 30, 2014 and 2013 Note I - Description of the Plan The following description of Lansing Board of Water and Light Employees' Defined Contribution Pension Plan (the "Plan") provides only general information. Participants should refer to the plan agreement for a more complete description of the Plans provisions. General - The Plan was established by the Lansing Board of Water and Light (the "BWL") in 1997 under Section 5-203 of the City Charter. Prior to its establishment, the BWL sponsored a defined benefit plan (Plan for Employees' Pensions of the Board of Water and Light - City of Lansing, Michigan - Defined Benefit Plan) in which substantially all employees of the BWL were participants. Effective December 1, 1997, all active participants of the defined benefit plan were required to make an irrevocable choice to either remain in the defined benefit plan or move to the newly established defined contribution plan (Lansing Board of Water and Light Employees' Defined Contribution Plan). Those participants who elected to move to the defined contribution plan received lump-sum distributions from the defined benefit plan, which were rolled into their accounts in the new defined contribution plan. Of the 760 active participants who were required to make this election, 602 elected to convert their retirement benefits to the newly established defined contribution plan. As a result of this action, effective December 1, 1997, the Board of Commissioners transferred $75,1 16,470 to the newly established defined contribution plan, reflecting the plan participants' accumulated benefits as of said date. ICMA-RC, the plan administrator, controls and manages the operation and administration of the Plan. Contributions - For employees hired before January 1, 1997, the BWL is required to contribute 15 percent of the employees' compensation. For employees hired on or after January 1, 1997, the BWL is required to contribute 8.1 percent of the employees' compensation. In addition, the BWL is required to contribute an additional 3.0 percent of the employees' compensation for all employees who are not eligible to receive overtime pay and 0.5 percent of the employees' compensation for all non-bargaining employees. The Board of Commissioners of the Board of Water and Light - City of Lansing may amend the Plan's provisions and contribution requirements. 7 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Notes to Financial Statements June 30, 2014 and 2013 Note I - Description of the Plan (Continued) Participant Accounts - Each participant's account is credited with the participant's rollover contributions and withdrawals, as applicable, and allocations of the BWL's contributions and plan earnings. Allocations are based on participants' earnings or account balances, as defined in the plan document. Forfeited balances of terminated participants' non-vested accounts are used to reduce future BWL contributions. The benefit to which a participant is entitled is the benefit that can be provided from the participant's account. As of June 30, 2014, there were 822 participants in the Plan, of which 682 were active employees. As of June 30, 2013, there were 825 participants in the Plan, of which 657 were active employees. Vesting - Participants become vested in the BWL contribution and related earnings after completing three years of service, at a rate of 25 percent each year. Participants become fully vested after six years of service. Investment Options - Participants may direct contributions in any of the following investment options, which are administered by ICMA-RC. Since ICMA-RC is the custodian as defined by the Plan, transactions in the ICMA funds qualify as transactions with parties-in-interest. Stable Value - Seeks safety of principal, adequate liquidity, and returns superior to shorter maturity alternatives by actively managing a diversified portfolio of assets issued by highly rated financial institutions and corporations as well as obligations of the U.S. government or its agencies. Balanced - Seeks both current income and capital appreciation by investing in a combination of stocks, bonds, and money market instruments. Growth - Seeks long-term capital appreciation by investing primarily in equity securities of companies with above-average growth prospects. Current income is a secondary concern. 8 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Notes to Financial Statements June 30, 2014 and 2013 Note I - Description of the Plan (Continued) International - Seeks long-term capital appreciation by investing primarily in equity securities of issuers located outside of the U.S. Stock Funds - Seeks long-term growth through capital gains, although historically dividends have been an important source of total return. These funds primarily invest in the common stocks of companies based in the United States. There are many options for diversification within this category. Bond and Equity Funds - Seeks to maximize current income with capital appreciation as a secondary consideration by investing primarily in debt securities issued by the U.S. government or its agencies and domestic and foreign corporations. They are not fixed- income investments. Even when a mutual fund's portfolio is composed entirely of bonds, the fund itself has neither a fixed yield nor a contractual obligation to give investors back their principal at some later maturity date -the two key fixed characteristics of individual bonds. Self-directed Brokerage Account - Participants with a minimum account balance of $35,000 may transfer from their fund accounts a minimum of $5,000 to a self-directed brokerage account. Eligible investments are equity securities traded on U.S. exchanges valued at greater than $5 and over 400 mutual funds from 18 investment management companies. Participants pay a one-time set-up fee of$50. Participant Notes Receivable - Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum of the lesser of $50,000 or 50 percent of their account balances. Notes receivable are treated as transfers between the investment fund and the notes receivable fund. Note terms range from one to five years or up to 20 years for the purchase of a primary residence. The notes receivable are secured by the balance in the participant's account and bear interest at a rate commensurate with prevailing rates as determined periodically by the plan administrator. Principal and interest are paid ratably through payroll deductions. Payment of Benefits - Upon termination of service, a participant may elect to receive either a lump-sum amount equal to the value of the participant's vested interest in his or her account, or choose from a variety of periodic payment options. Change in Accounting - During the current year, the Plan adopted GASB Statement No. 67, Financial Reporting for Pension Plans. This statement required certain information to be included within the notes to the financial statements. As this information was already included, there were no significant changes due to the implementation of this standard. 9 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Notes to Financial Statements June 30, 2014 and 2013 Note 2 - Summary of Significant Accounting Policies Basis of Accounting - The financial statements of the Plan have been prepared using the accrual method of accounting in accordance with Governmental Accounting Standards Board (GASB) Statement No. 67, Financial Reporting for Pension Plans. Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of additions and deductions during the reporting period. Actual results could differ from those estimates. Valuation of Investments and Income Recognition - The investments are stated at market value based on closing sales prices reported on recognized securities exchanges on the last business day of the year, or for listed securities having no sales reported, and for unlisted securities, upon the last reported bid prices on that date. The mutual funds are valued at quoted market prices, which represent the net asset values of shares held by the Plan at year end. Purchases and sales of investments are recorded on a trade-date basis. Interest income is accrued when earned. Dividend income is recorded on the ex-dividend date. Participant Notes Receivable - Participant notes receivable are recorded at their unpaid principal balances plus any accrued interest. Participant notes receivable are written off when deemed uncollectible. Expenses - The Plan's expenses are paid by the BWL as provided by the plan document. Regulatory Status - The Plan is not subject to the reporting requirements of the Employee Retirement Income Security Act of 1974 (ERISA) as it has been established for the benefit of a governmental unit. 10 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Notes to Financial Statements June 30, 2014 and 2013 Note 3 - Investments The pension trust fund is authorized by Michigan Public Act 314 of 1965, as amended, to invest in certain reverse repurchase agreements, stocks, diversified investment companies, annuity investment contracts, real estate leased to public entities, mortgages, real estate, debt or equity of certain small businesses, certain state and local government obligations, and certain other specified investment vehicles. The Plan's deposits and investment policies are in accordance with PA 196 of 1997 and has authorized the investments according to Michigan PA 314 of 1965, as amended. Risks at June 30, 2014 Custodial Credit Risk of Bank Deposits - At the end of the year, the Plan has no bank deposits. Credit Risk - State law limits investments in commercial paper to the top two ratings issued by nationally recognized statistical rating organizations. The Plan has no investment policy that would further limit its investment choices. As of year end, the credit quality ratings of debt securities (other than the U.S. government) are as follows: Rating Investment Fair Value Rating Organization Mutual funds $ 130,442,786 Not rated Not rated Stable value 33,607,203 AA S&P Risks at June 30, 2013 Custodial Credit Risk of Bank Deposits - At the end of the year, the Plan has no bank deposits. Credit Risk - State law limits investments in commercial paper to the top two ratings issued by nationally recognized statistical rating organizations. The Plan has no investment policy that would further limit its investment choices. As of year end, the credit quality ratings of debt securities (other than the U.S. government) are as follows: Rating Investment Fair Value Rating Organization Mutual funds $ 109,882,178 Not rated Not rated Stable value 32,243,585 AA S&P II Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Notes to Financial Statements June 30, 2014 and 2013 Note 4 - Plan Termination Although it has not expressed any intention to do so, the BWL has the right under the Plan to terminate the Plan subject to the provisions set forth in Article 12 of the Plan. In the event of any termination of the Plan, or upon complete or partial discontinuance of contributions, the accounts of each affected participant shall become fully vested. Note 5 - Tax Status The Plan is a prototype plan. The prototype plan has received a favorable opinion letter from the Internal Revenue Service (IRS) that the prototype plan, as designed, is qualified for federal income tax-exempt status. The Plan has not individually sought its own determination letter. 12 Supplemental Information 13 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Statement of Changes in Net Position by Fund Money Market Bond Funds Year Ended June 30 Year Ended June 30 2014 2013 2014 2013 Increase Investment income: Net appreciation(depreciation) in fair value of investments $ 485 $ 672 $ 449,026 $ (597,106) Interest income - - - - Dividend income - 2 555,414 818,952 Employer contributions 13,731 10,367 487,362 477,598 Participant rollover contributions - 3,553 33,403 14,921 Loan repayments 4,550 3,271 173,174 157,446 Interest from participant notes receivable - - - - Other - - 13 Total increase, net of realized and unrealized gains and losses 18,766 17,865 1,698,392 866,743 Decrease Benefits paid to participants 64,086 64,224 536,673 519,536 Loans to participants 3,572 4,869 169,585 183,939 Loan defaults - - - - Participants'note and administrative fees 972 552 21,360 16,768 Total decrease 68,630 69,645 727,618 720,243 Net(Decrease) Increase Prior to Interfund Transfers (49,864) (51,780) 970,774 146,500 Interfund Transfers (250,764) 294,155 (852,733) 2,652,578 Net(Decrease) Increase (300,628) 242,375 118,041 2,799,078 Net Position Beginning of year 418,421 176,046 16,438,836 13,639,758 End of year $ 117,793 $ 418,421 $ 16,556,877 $ 16,438,836 14 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Statement of Changes in Net Position by Fund (Continued) Stock Funds Balanced Funds Year Ended June 30 Year Ended June 30 2014 2013 2014 2013 Increase Investment income: Net appreciation(depreciation) in fair value of investments $ 9,532,529 $ 8,254,935 $ 3,198,720 $ 1,770,597 Interest income - - - - Dividend income 3,874,276 1,273,144 558,296 425,615 Employer contributions 1,752,951 1,802,137 1,375,608 1,269,412 Participant rollover contributions 100,790 289,661 197,557 830,559 Loan repayments 602,678 619,254 349,248 370,113 Interest from participant notes receivable - - - - Other 5 39 65 5,255 Total increase, net of realized and unrealized gains and losses 15,863,229 12,239,170 5,679,494 4,671,551 Decrease Benefits paid to participants 2,539,594 2,599,500 996,083 1,262,633 Loans to participants 634,522 640,159 367,726 497,315 Loan defaults - - - - Participants'note and administrative fees 31,744 31,247 12,891 9,530 Total decrease 3,205,860 3,270,906 1,376,700 1,769,478 Net(Decrease) Increase Prior to Interfund Transfers 12,657,369 8,968,264 4,302,794 2,902,073 Interfund Transfers (3,657,845) (2,789,461) 4,798,682 (761,958) Net Incease(Decrease) 8,999,524 6,178,803 9,101,476 2,140,1 15 Net Position Beginning of year 51,617,791 45,438,988 20,394,104 18,253,989 End of year $ 60,617,315 $ 51,617,791 $ 29,495,580 $ 20,394,104 15 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Statement of Changes in Net Position by Fund (Continued) Growth Funds International Funds Year Ended June 30 Year Ended June 30 2014 2013 2014 2013 Increase Investment income: Net appreciation(depreciation) in fair value of investments $ 1,053,965 $ 587,820 $ 3,063,853 $ 2,231,514 Interest income - - - - Dividend income - 176,562 397,037 416,710 Employer contributions 588,556 609,029 535,453 595,157 Participant rollover contributions 9,045 - 31,217 148,746 Loan repayments 138,956 114,581 168,865 176,721 Interest from participant notes receivable - - - - Other - - 22 - Total increase, net of realized and unrealized gains and losses 1,790,522 1,487,992 4,196,447 3,568,848 Decrease Benefits paid to participants 266,068 308,879 712,842 873,697 Loans to participants 355,677 108,463 154,955 174,776 Loan defaults - - - - Participants'note and administrative fees 4,010 2,718 14,078 13,339 Total decrease 625,755 420,060 881,875 1,061,812 Net(Decrease) Increase Prior to Interfund Transfers 1,164,767 1,067,932 3,314,572 2,507,036 Interfund Transfers (756,292) (476,252) (1,080,852) (1,662,094) Net Incease(Decrease) 408,475 591,680 2,233,720 844,942 Net Position Beginning of year 5,736,285 5,144,605 15,276,741 14,431,799 End of year $ 6,144,760 $ 5,736,285 $ 17,510,461 $ 15,276,741 16 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Statement of Changes in Net Position by Fund (Continued) Total Mutual Funds Year Ended June 30 2014 2013 Increase Investment income: Net appreciation(depreciation) in fair value of investments $ 17,298,578 $ 12,248,432 Interest income - - Dividend income 5,385,023 3,1 10,985 Employer contributions 4,753,661 4,763,700 Participant rollover contributions 372,012 1,287,440 Loan repayments 1,437,471 1,441,386 Interest from participant notes receivable - - Other 105 226 Total increase, net of realized and unrealized gains and losses 29,246,850 22,852,169 Decrease Benefits paid to participants 5,1 15,346 5,628,469 Loans to participants 1,686,037 1,609,521 Loan defaults - - Participants'note and administrative fees 85,055 74,154 Total decrease 6,886,438 7,312,144 Net(Decrease) Increase Prior to Interfund Transfers 22,360,412 15,540,025 Interfund Transfers (1,799,804) (2,743,032) Net Incease(Decrease) 20,560,608 12,796,993 Net Position Beginning of year 109,882,178 97,085,185 End of year $ 130,442,786 $ 109,882,178 17 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Statement of Changes in Net Position by Fund (Continued) Stable Value Fund Brokerage Account Year Ended June 30 Year Ended June 30 2014 2013 2014 2013 Increase Investment income: Net appreciation(depreciation) in fair value of investments $ 609,278 $ 695,952 $ - $ (19,748) Interest income - - 160,691 - Dividend income - - - - Employer contributions 714,164 730,401 - - Participant rollover contributions 681,866 1,108,253 - - Loan repayments 233,842 235,983 - - Interest from participant notes receivable - - Other 114,887 110,198 - - Total increase, net of realized and unrealized gains and losses 2,354,037 2,880,787 160,691 (19,748) Decrease Benefits paid to participants 2,529,770 3,468,740 - - Loans to participants 122,602 255,109 - - Loan defaults - - - - Participants'note and administrative fees 11,100 9,824 - - Total decrease 2,663,472 3,733,673 - - Net Increase (Decrease) Prior to Interfund Transfers (309,435) (852,886) 160,691 (19,748) Interfund Transfers 1,673,053 2,549,452 126,751 193,580 Net Incease(Decrease) 1,363,618 1,696,566 287,442 173,832 Net Position Beginning of year 32,243,585 30,547,019 859,599 685,767 End of year $ 33,607,203 $ 32,243,585 $ 1,147,041 $ 859,599 18 Lansing Board of Water and Light Employees' Defined Contribution Pension Plan Statement of Changes in Net Position by Fund (Continued) Participant Notes Receivable Total Year Ended June 30 Year Ended June 30 2014 2013 2014 2013 Increase Investment income: Net appreciation(depreciation) in fair value of investments $ - $ - $ 17,907,856 $ 12,924,636 Interest income - - 160,691 - Dividend income - - 5,385,023 3,1 10,985 Employer contributions - - 5,467,825 5,494,101 Participant rollover contributions - - 1,053,878 2,395,693 Loan repayments (1,671,313) (1,677,369) - - Interest from participant notes receivable 155,997 139,026 155,997 139,026 Other - - 114,992 110,424 Total increase, net of realized and unrealized gains and losses (1,515,316) (1,538,343) 30,246,262 24,174,865 Decrease Benefits paid to participants - - 7,645,1 16 9,097,209 Loans to participants (1,808,639) (1,864,630) - - Loan defaults 1 19,694 120,280 119,694 120,280 Participants'note and administrative fees - - 96,155 83,978 Total decrease (1,688,945) (1,744,350) 7,860,965 9,301,467 Net Increase(Decrease) Prior to Interfund Transfers 173,629 206,007 22,385,297 14,873,398 Interfund Transfers - - - - Net Incease(Decrease) 173,629 206,007 22,385,297 14,873,398 Net Position Beginning of year 3,909,080 3,703,073 146,894,442 132,021,044 End of year $ 4,082,709 $ 3,909,080 $ 169,279,739 $ 146,894,442 19