2018 City of Shakopee Comprehensive Annual Financial Report

CITY OF SHAKOPEE SCHEDULE OF CHANGES IN THE CITY'S OPEB LIABILITY AND RELATED RATIOS

2018

Total OPEB Liability Service cost

$

143,652 79,747 81,560 (72,637) 232,322

Interest

Changes of assumptions

Benefit payments

Net change in total OPEB liability Total OPEB liability- beginning

1,985,761

Total OPEB liability- ending

2,218,083 $

Covered Employee Payroll

12,533,653 $

City's Total OPEB Liability as a Percentage of Covered Employee Payroll

17.70%

Assumption changes: In 2018, the following benefit changes occurred: The discount rate was changed from 3.81% as of 12/31/2016 to 3.31% as of 12/31/2017 based on updated 20-year municipal bond rates as of each measurement date. Since the most recent GASB 45 valuation, the following changes have been made: The discount rate was changed from 3.50% to 3.81% based on updated measurement dates and GASB 75 requirements. Healthcare trend rates were reset to reflect updated const increase expectations, including an adjustment to reflect the impact of the Affodarble Care Act's Excise Tas on high-cost health insurance plans. Medical per capita claims costs were updated to reflect recent experience and new plan offerings. Withdrawal, retirement, mortality and salary increase rates were updated from the rates used in the 7/1/2015 PERA General and Police & Fire Employees Retirement Plan to the rates used in the 7/1/2018 valuation. The percent of future regular retirees assumed to elect coverage at retirement changed from 50% to 30% to reflect recent plan experience. The inflation assumption was changed from 2.75% to 2.50% based on an updated historical analysis of inflation rates and forward looking market expectations.

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