Pension Plans

METRO has three pension plans which consist of two defined benefit pension plans and one defined contribution pension plan. Contributions for all three plans are authorized annually by the METRO Board of Directors during the annual budgeting process.

The Government Finance Officers Association (GFOA) has regularly awarded METRO a certificate of achievement for excellence in financial reporting for our two defined benefit pension plans. And we’ve earned the highest grade available from the Texas Comptroller's Office.

Transparency Star for Public Pensions from the Texas Comptroller's Office and GFOA Certificate of Achievement for Excellence in Financial Reporting logos.

Definitions

The Non-Union Pension Plan is a noncontributory, single-employer, defined-benefit plan and was closed to new participants on October 1, 2007.

METRO makes monthly contributions to this plan which are authorized annually by METRO’s Board of Directors during the annual budgeting process.

Funding policy for the defined benefit pension plans is to contribute each year the independently calculated, actuarially determined contribution in equal payments over a 12-month period using the key assumptions provided in the actuarial methodology tab below.

The Transport Workers Union Pension Plan (Union Plan) is a contributory (effective October 1, 2018), single-employer, defined-benefit pension plan and was closed to new participants on October 1, 2012. Employees in the Union Plan contribute $3 each week through payroll deductions. Employees not eligible for the defined benefit pension plans are placed into the defined contribution plan.

METRO makes monthly contributions to this plan which are authorized annually by METRO’s Board of Directors during the annual budgeting process.

Funding policy for the defined benefit pension plans is to contribute each year the independently calculated, actuarially determined contribution in equal payments over a 12-month period using the key assumptions provided in the actuarial methodology tab below.

METRO’s monthly contributions to the defined contribution plan equals 4% of the employees’ annual salary with METRO matching up to an additional 4% of the employee’s 457(b) Deferred Compensation Plan contributions.

METRO makes weekly contributions to the defined contribution plan, which are authorized annually by METRO’s Board of Directors during the annual budgeting process.

METRO’s contributions are placed into a third-party trust account with employees’ vesting rates equally 40 percent after the second year with an additional 20 percent vesting occurring each of the next three years.

Funding policy for the defined benefit pension plans is to contribute each year the independently calculated, actuarially determined contribution in equal payments over a 12-month period using the following key assumptions:

  • Actuarial cost method – Entry age normal
  • Amortization method – Level percentage of payroll, closed
  • Asset valuation method – five-year smoothed market value
  • Inflation – 2.30%
  • Salary increases:
    Union
    3.25% for 2024, 4.00% for 2025, 3.50% for 2026, 4.00% for 2027 and 3.25% thereafter, with an additional 0.25% for 2025, 1.25% for 2026, and 1.5% for 2027 for bus operators hired after June 1, 1999.
    Non-Union
    3.25% for 2024 and thereafter.
  • Actuarial assumed rate of return 6.25% is a net of an explicit assumption for expected administrative expense.
  • Mortality – The mortality assumption is updated annually and is currently using the Pub-2010 General Employee / Healthy Retiree Mortality Tables for M/F projected forward (fully generational) with MP-2021 with separate tables for contingent survivors and disabled participants. This reflects the most current mortality experience published by the Society of Actuaries for public plans. This assumption includes a margin for future improvements in longevity.

Public Pension Summary

The following table shows financial information for the public pension summary and defined benefit plans as of Dec. 31, 2024.

InformationUnionNon-Union
Funded ratio69.8%59.9%
Remaining Amortization period18 year18 year
Rate of return*  
1 Year7.5%8.3%
3 Year0.2%0.6%
5 Year4.7%4.9%
10 Year5.3%5.2%
Assumed rate of return6.25%6.25%
Actuarially Determined Contribution (ADC) amount$14,362,215$15,134,183
Actual Employer Contribution amount$14,447,534$15,152,716
Unfunded Actuarial Accrued Liability (UAAL)$139,214,731$138,294,863
UAAL as a percent of covered payroll228.9%420.4%


* The investment returns are calculated using the geometric method and are presented net of fees.

Union Plan


Actuarial Value of Assets Versus Actuarial Accrued Liabilities (In Millions)


Fiscal YearValue of AssetsAccrued Liabilities
2020$302.6$447.0
2021$323.6$458.9
2022$325.1$459.8
2023$326.4$458.9
2024$321.9$461.1

The investment returns are calculated using the geometric method and are presented net of fees.

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Actuarially Determined Contribution Amount Versus Actual Total Contribution Amount Fiscal Year 2020-2024 (In Thousands)


Fiscal YearDetermined ContributionActual Contribution
2020$17,079$17,079
2021$15,836$15,836
2022$15,166$15,668
2023$14,557$14,557
2024$14,362$14,362

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Actuarially Determined Contribution Rate Versus Actual Total Contribution Rate Fiscal Year 2020-2024


Fiscal YearDetermined ContributionActual Contribution
202021.0%21.0%
202120.0%20.0%
202222.8%23.6%
202322.1%22.1%
202423.6%23.6%

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Transport Workers Union Pension Plan, Local 260, AFL-CIO For Five Years Ended December 31 for the following years:


Additions20242023202220212020
Employer contributions$14,362,215$14,557,542$15,668,399$15,836,027$17,805,961
Pick-up contributions$85,319$103,386$142,951$164,295$184,148
Investment income / (loss)     
Interest and dividends$2,160,511$1,972,220$1,835,654$3,874,488$3,821,788
Net appreciation / (depreciation) on investments$20,469,595$23,917,246-$50,437,482$34,202,401$30,524,776
Investment income / (loss)$22,630,106$25,889,466-$48,601,828$38,076,889$34,346,564
Less investment expenses$684,824$726,297$837,193$712,658$679,664
Net investment income / (loss)$21,945,282$25,163,169-$49,439,021$37,364,231$33,666,900
Total Additions$36,392,816$39,824,097-$33,627,671$53,364,553$50,929,731

Deductions20242023202220212020
Paid to Plan members and beneficiaries$31,365,050$30,148,705$26,127,147$24,083,715$23,306,331
Administrative services$421,981$403,087$411,191$417,525$388,021
Total Deductions$31,787,031$30,551,792$26,538,338$24,501,240$23,694,352

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Non-Union Plan


Actuarial Value of Assets Versus Actuarial Accrued Liabilities (In Millions)


Fiscal YearValue of AssetsAccrued Liabilities
2020$193.5$307.7
2021$195.3$302.9
2022$197.8$323.6
2023$207.8$334.4
2024$207.0$345.3

The investment returns are calculated using the geometric method and are presented net of fees.

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Actuarially Determined Contribution Amount Versus Actual Total Contribution Amount Fiscal Year 2020-2024 (In Thousands)


Fiscal YearDetermined ContributionActual Contribution
2020$14,218$14,237
2021$13,429$13,448
2022$12,583$13,308
2023$14,831$14,850
2024$15,134$15,153

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Actuarially Determined Contribution Rate Versus Actual Total Contribution Rate Fiscal Year 2020-2024


Fiscal YearDetermined ContributionActual Contribution
202037.4%37.4%
202141.7%41.8%
202238.4%40.6%
202344.3%44.4%
202446.0%46.1%

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Non-Union Pension Plan For Five Years Ended December 31


Additions20242023202220212020
Employer contributions$15,152,816$14,849,952$13,308,196$13,447,958$14,236,592
Investment income     
Interest and dividends$1,311,324$1,254,943$1,045,282$1,455,245$960,902
Net appreciation / (depreciation) on investments$14,651,483$16,094,346-$30,036,961$21,752,092$20,373,224
Investment income / (loss)$15,962,807$17,349,289-$28,991,679$23,207,337$21,334,126
Less investment expenses$469,334$493,002$549,135$507,884$451,839
Net investment income / (loss)$15,493,473$16,856,287-$29,540,814$22,699,453$20,882,287
Total Additions$30,646,289$31,706,239-$16,232,618$36,147,411$35,118,879

Deductions20242023202220212020
Paid to Plan members and beneficiaries$24,700,720$15,536,121$17,595,120$29,179,951$16,899,341
Administrative services$367,436$306,556$278,324$324,750$351,276
Total Deductions$25,068,156$15,842,67717,873,444$29,504,701$17,250,617

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