One of the important duties vested with the Board of Trustees is that each year, after hearing from our highly experienced professional staff, we must evaluate rates for the coming year. This is somewhat of a balancing act. We want to collect enough money to cover expenses and build reserves. We do not want to come to possess more money than our professional staff thinks we reasonably need.
At the onset of this year, the trustees consulted with our experts and laid out the rate structure that would cover us until July 2015. Numerous factors came to bear this year that were highly favorable to LDF.
Even after trustees in July 2014 lowered the Base Plan 1 rate for the first time in 12 years, we have found that our reserves have grown by millions of dollars more than we had planned when we adopted the rates set in conjunction and consultation with our actuarial advisers, financial planners, accountants and professional staff.
On October 3, 2014, we announced a midyear, one-time rate reduction for the billing cycle occurring the first quarter of 2015. Some people have labeled this a partial rate holiday; some are calling it a reduction. But regardless of the label, this amounts to an immediate return to members of over $1.3 million. If you have not already seen the original announcement, it is included at the right, along with a graph showing the continued growth of fund assets that we have available for member benefits.