Totalrentalexpenserelatedtooperatingleaseswas$655,354 includedwithintheaccompanyingconsolidatedfinancial
and$362,061fortheyearsendedMarch31,2008and2007, statements. PEFincursvariouscostsforpayroll,benefitsand
respectively. Leaseagreementsfrequentlyincluderenewal officeexpensesonbehalfoftheRetirees’Fund,whichitbillsback
optionsandrequirePEFtopayutilities,taxes,insuranceand totheFund. IncludedinotherreceivablesatMarch31,2008and
maintenance. 2007arereceivablesfromtheFundfor$27,857and$21,514,
Additionally,asofMarch31,2008,PEF,aslessor,leases respectively.
certainofficespaceinitsmainofficebuildingonamonth-to-
monthbasis. Minimummonthlyrentalpaymentswillbe$2,661 9. FUNCTIONALEXPENSES
permonth.
PEF’sexpensesbyfunctionalactivitywereasfollows:
7. LITIGATION
2008 2007
UnderanarbitrationawardrenderedinMay1985,PEFwas
Membershipservices $13,638,669 $13,473,544
orderedtopayNewYorkStateUnitedTeachers/American
Administrationandsupport 4,067,480 3,093,684
FederationofTeachers(AFT)inexcessof$9millioninbackper
Grantsandcontractsactivities 372,996 470,840
capitataxesfortheperiodMarch1983throughMay1985.
Labormanagementactivities 2,843,770 3,749,507
Duringfiscal1988,aStateSupremeCourtdecisionvacatedthe
Legislativeandpoliticalaction 1,149,839 1,369,007
awardinitsentirety. However,AFTsubsequentlyappealedthe
Total
_
$
_
2
__
2
_
,0
__
7
_
2
_
,
_
7
_
5
_
4
_ _
$
_
2
__
2
_
,1
__
5
_
6
_
,
_
5
_
8
_
2
_
decisionand,inMay1989,theAppellateDivisionreversedthe
lowercourtdecision,therebyawardingAFTapproximately$9.2 10. TEMPORARILYRESTRICTEDNETASSETS
millionofbackpercapitataxes. In1989,PEFattemptedto
appealthedecisionoftheAppellateDivision.
TemporarilyrestrictednetassetsatMarch31,2008and
OnMarch27,1990,theCourtofAppealsdeniedPEF’s
2007areavailableforthefollowingpurposes:
motionandreaffirmedthejudgmenttoAFTofapproximately$9.2 2008 2007
millionforpercapitataxes. DuringthefiscalyearendingMarch COPE:
31,1991,AFTmadeamotiontotheStateSupremeCourttobe Politicalcontributions $274,598 $292,514
awardedprejudgmentdateinterest. InJune1991,theState
SupremeCourtgrantedAFT’smotionforprejudgmentdate 11. CHANGESINTEMPORARILYRESTRICTEDNETASSETS
interest. Interestontheoutstandingbalanceaccruesattherate
of9%annually. Eachyearsince1991,AFThasunilaterally
2008 2007
forgivenonetwentiethofthetotaloutstandingprincipalbalance
COPE:
andtheannualaccruedinterestamount.
Contributionsreceived
AFThasnotsoughtenforcementofthejudgmentinthepast,
withdonorrestrictions $108,825 $100,463
butrather,asnoted,hasforgivenaportionoftheindebtedness
Interestearnedthathas
andinterest. ItisnotpossibletopredictwhetherAFTwillseekto
beenrestricted $ 10,788 $ 10,978
enforcethejudgmentinthefuture. Accordingly,PEFhas
reportedaliabilityofapproximately$2.44million,which
Netassetsreleasedfromdonor
representsthejudgmentamountplusaccruedinterestat9%per
restrictionsbyincurring
annumfromthearbitrationdateslessamountspreviously
expensessatisfyingthe
forgiven.
restrictedpurposes $137,529 $ 78,297
PEFhasbeennamedasadefendantinseveralotherlawsuits
andclaims. Whiletheultimateoutcomeoftheseactionscannot
12. CONCENTRATIONOFCREDITRISK
bepredictedatthistime,itistheopinionofmanagementthatthe
dispositionoftheselawsuitsandclaimswillnothaveamaterial
PEFmaintainsitscashaccountsinlocalfinancial
adverseeffectonthefinancialpositionofPEF.
institutions. AttimesthesebalancesexceedFDICinsured
amounts.
8. RELATEDORGANIZATIONS
13. ACCRUEDPOST-RETIREMENTBENEFITS
RetiredPEFemployeescanconvertunusedsickleavetocash
PEFisaffiliatedwiththefollowing:
forthepurposeofpayinghealthinsurancebenefits. Tobe
PublicEmployeesFederationMembershipBenefitsProgram
eligible,retiringemployeesmustmeetoneofthethreefollowing
criteria: sixty-fiveyearsofageandthreeyearsofservice;fifty-five
ThistrustwasestablishedtoprovidePEFmembersthe yearsofageand10yearsofservice;oragefiftyand30yearsof
opportunitytoobtainvariousinsuranceandotherbenefitsat service. PEFrecognizesthecostofprovidingpostretirement
grouprates. ThisprogramisoutsidetheoperationsofPEFandis healthinsurancebenefitsbyestimatingtheaccumulated
notincludedwithintheaccompanyingconsolidatedfinancial postretirementbenefit. Itisatleastreasonablypossiblethatthis
statements. PEFisnotresponsibleforthedebtsofthe significantestimatewillchangewithinthenextyear.
MembershipBenefitsProgramandanyremainingassetsupon Thefollowingtablesetsforththeplan’sstatusreconciled
terminationoftheprogramreverttotheparticipatingmembers withtheamountshowninPEF'sstatementoffinancialposition
andnottoPEF. atMarch31,2008:
PEFincurscostsonbehalfoftheprogram,whicharebilled
backtotheMembershipBenefitsProgram. Includedinother AccumulatedPostretirementBenefitObligation:
receivablesatMarch31,2008and2007arereceivablesfromthe Benefitobligationatbeginningofyear $2,676,746
programfor$253,101and$175,238,respectively. The Servicecost 155,112
MembershipBenefitsProgramoccupiesspaceinPEF’s Interestcost 215,944
headquartersonamonthtomonthleasewithPEFrequiring Benefitspaid (117,993)
minimumpaymentsof$2,661monthlyplustheproportionate Recognitionofactuarialloss(gain) 610,116
shareoftaxes,utilitiesandcommonareacosts. TotalAccumulatedPostretirement
BenefitObligation $3,539,925
Retirees’Fund Planassetsatfairvalue —
AccumulatedPostretirementBenefit
TheFundwasestablishedtoprovidevariousservices,such
ObligationinExcessofPlanAssets (3,539,925)
ascontinuinginsuranceandseminars,toretiredPEFmembers.
Unrecognizedpriorservicecost —
ThisFundisoutsidetheoperationsandcontrolofPEFandisnot
Unrecognizedactuarialloss —
Page20—TheCommunicatorFebruary2009 PEFInformationLine:1-800-553-2445
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