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6.1 B
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<br /> NOTE 9 — EMPLOYEE BENEFITS �CONTINUED)
<br /> The City is not required by law or contractual agreement to provide funding for retiree health costs
<br /> other than the pay-as-you-go amount necessary to provide current benefits to retirees. The City's retiree
<br /> health plan is being managed through the California Employer's Retiree Benefits Trust (CERBT), an
<br /> 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 /> The CERBT's administrator, CaIPERS, issues a publicly available financial report consisting of financial
<br /> statements and required supplementary information for CERBT in aggregate. The report may be
<br /> obtained by writing to CaIPERS, Lincoln Plaza North, 400 Q Street, Sacramento, CA 95811. During FY
<br /> 2009/10, the City contributed $3,830,000, or 103%, of the actuarially required contributions to the
<br /> retiree health plan. �
<br /> The City's annual other post employment benefit (OPEB) cost (expense) is calculated based on the
<br /> annual required contribution of the employer (ARC), 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. The following table shows the
<br /> components of the City's annual OPEB costs for the year, the amount actually contributed to the plan,
<br /> and changes in the City's net OPEB obligation.
<br /> Annual Required Contribution $ 3,729,000
<br /> Interest on net OPEB obligation 517,000
<br /> Adjustment to annual required contribution (416,000)
<br /> Annual OPEB Cost 3,830,000
<br /> Contributions made to irrevocable trust (2,207,196)
<br /> Benefit payments made outside of trust (1,622,804)
<br /> Increase in net OPEB obligation p
<br /> Net OPEB obligation - beginning of the year 6,674,477
<br /> Net OPEB obligation - end of the year $ 6,674,477
<br /> The City annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net
<br /> OPEB obligation for the fiscal year ended June 30, 2010 and the two preceding years were as follows:
<br /> Year Annual AnnuaIOPEB OPEB
<br /> Ended OPEB Cost Cost Contributed Obligation (Asset)
<br /> $ % $
<br /> 6/30/2008 4,744,124 31 3,263,392
<br /> 6/30/2009 5,027,000 32 6,674,477
<br /> 6/30/2010 3,830,000 100 6,674,477
<br /> As of June 30, 2009, the most recent actuarial valuation date, the plan was 0% funded. The actuarial
<br /> accrued liability (AAL) for benefits was $37,264,000, and the actuarial value of plan assets was $0,
<br /> resulting in an unfunded actuarial accrued liability (UAAL) of $37,264,000. The covered payroll (annual
<br /> payroll of active employees covered by the plan) was $43,764,165 and the ratio of UAAL to the covered
<br /> payroll was 85%.
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