2019 City of Shakopee Comprehensive Annual Financial Report

CITY OF SHAKOPEE

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

2017

2018

Total OPEB Liability Service cost Interest

$

143,652 79,747

$

77,453 (69,528) (85,589) 164,694

Changes of assumptions Benefit payments

81,560 (72,637) 232,322 1,985,761

Net change in total OPEB liability Total OPEB liability- beginning

87,030 2,218,083

Total OPEB liability- ending

2,218,083 $

2,305,113 $

Covered Employee Payroll

12,533,653 $

12,472,516 $

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

17.70%

18.48%

Assumption changes:

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 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. Healthcare trend rates were reset to reflect updated const increase expectations, including 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. 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 In 2019, the following benefit changes occurred: The discount rate was changed from 3.31% as of 12/31/2017 to 3.71% as of 12/31/2018 based on updated 20-year municipal bond rates as of each measurement date.

analysis of inflation rates and forward looking market expectations.

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