Laserfiche WebLink
Appendix A <br />Page 4 <br />Other Post-Employment Benefits (OPEB) <br /> <br />The City administers a single-employer defined benefit post-employment healthcare plan. <br />Permanent employees who retire under the City’s retirement plan are, pursuant to their respective <br />collective bargaining agreements, eligible to have their medical insurance premiums reimbursed by the <br />City up to the Kaiser family premium rate. Medical insurance premiums for spouses and other <br />dependents generally are not paid by the City. In the case of public safety disability retirement, the City <br />provides medical insurance for dependents. Currently there are 375 retirees receiving this benefit. <br /> <br />The City is not required by law or contractual agreement to provide funding for retiree health <br />costs other than the pay-as-you-go amount necessary to provide current benefits to retirees. The City’s <br />retiree health plan is being managed through the California Employer’s Retiree Benefits Trust (CERBT), <br />an irrevocable trust fund that allows public employers to prefund the future cost of their retiree health <br />insurance benefits and other post-employment benefits for their covered employees or retirees. <br /> <br />The CERBT’s administrator, CalPERS, issues a publicly available financial report consisting of <br />financial statements and required supplementary information for CERBT in aggregate. The report may be <br />obtained by writing to CalPERS, Lincoln Plaza North, 400 Q Street, Sacramento, CA 95811. During FY <br />2015-16, the City contributed $5,982,000, or 100%, of the actuarially required contributions to the retiree <br />health plan. <br /> <br />Total current payroll for all covered employees for the fiscal year ended June 30, 2016 was <br />$57,881,620. <br /> <br />The City’s annual other post-employment benefit (OPEB) cost (expense) is calculated based on <br />the annual required contribution (ARC) of the employer, an amount actuarially determined in accordance <br />with the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an <br />ongoing basis, is projected to cover normal costs each year and amortize any unfunded actuarial <br />liabilities (or funding excess) over a period not to exceed thirty years. <br /> <br />The following table shows the components of the City’s annual OPEB costs for the year, the <br />amount actually contributed to the plan, and changes in the City’s net OPEB obligation. <br /> <br />REDWOOD CITY <br />Annual OPEB Cost <br /> <br />Annual Required Contribution (ARC) 5,920,000 <br />Interest on net OPEB obligation 505,000 <br />Adjustment to ARC (443,000) <br />Annual OPEB Cost 5,982,000 <br />Contributions made to irrevocable trust (2,889,260) <br />Benefit payments made outside of trust (3,092,740) <br />Increase in net OPEB obligation - <br />Net OPEB obligation – beginning of year 6,962,477 <br />Net OPEB obligation – end of year 6,962,477 <br /> <br />Source: Redwood City 2015-16 CAFR. <br /> <br />8.C. - Page 79