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NOTE 13 — OTHER POST -EMPLOYMENT BENEFITS (OPEB) PLAN (CONTINUED) <br />B. Benefits Provided <br />All retirees of the City have the option under state law to continue their medical insurance coverage through <br />the City from the time of retirement until the employee reaches the age of eligibility for Medicare. For <br />members of all employee groups, the retiree must pay the full premium to continue coverage for medical <br />and dental insurance. Per state statutes, the City is also required to contribute towards the cost of continued <br />health insurance coverage for officers and firefighters disabled or killed in the line of duty. <br />The City is legally required to include any retirees for whom it provides health insurance coverage in the <br />same insurance pool as its active employees until the retiree reaches Medicare eligibility, whether the <br />premiums are paid by the City or the retiree. Consequently, participating retirees are considered to receive <br />a secondary benefit known as an "implicit rate subsidy." This benefit relates to the assumption that the <br />retiree is receiving a more favorable premium rate than they would otherwise be able to obtain if purchasing <br />insurance on their own, due to being included in the same pool with the City's younger and statistically <br />healthier active employees. <br />C. Contributions <br />The required contribution is based on projected pay-as-you-go financing requirements, with additional <br />amounts to prefund benefits as determined periodically by the City. The City's current year required pay- <br />as-you-go contributions to finance the benefits described in the previous section totaled $49,708. <br />D. Membership <br />Membership in the plan consisted of the following as of the latest actuarial valuation: <br />Retirees and beneficiaries receiving benefits 4 <br />Active plan members 100 <br />Total members 104 <br />E. Total OPEB Liability of the City <br />The City's total OPEB liability of $1,379,460 as of year-end was measured as of December 31, 2023, and <br />was determined by an actuarial valuation as of December 31, 2023. <br />F. Actuarial Methods and Assumptions <br />The total OPEB liability was determined by an actuarial valuation as of December 31, 2023, using the entry <br />age normal level percent of pay method. The following actuarial assumptions applied to all periods <br />included in the measurement, unless otherwise specified: <br />Discount rate 3.77% <br />20-year municipal bond yield 3.77% <br />Inflation rate 2.60% <br />Salary increases 3.00% <br />Healthcare cost trend rate 7.75% grading to 4.00% over several decades <br />91 <br />