2023 Annual Comprehensive Financial Report

NOTES TO REQUIRED SUPPLEMENTARY INFORMATION

2022 CITY OF SHAKOPEE SCHEDULE OF CHANGES IN THE CITY'S OPEB LIABILITY AND RELATED RATIOS 2023 2021 2020 2018 2019

Total OPEB Liability Service cost Interest

$

79,747 143,652

$

164,694 77,453

$

162,381 89,919

$

80,808 212,676 (11,389) 215,072

$

248,127

$

129,364

67,656 (755,344) (471,095) (88,083) (998,739) 3,178,694

(87,485) (333,352) 3,690 (420,608) 41,687 2,179,955

Differenced between expected and actual experience Changes of assumptions

-

-

135,664

(87,621) 164,630

81,560

(69,528) (85,589)

Benefit payments

(72,637) 232,322

(88,559) 408,608 2,770,086

87,030 2,218,083

464,973 2,305,113

Net change in total OPEB liability Total OPEB liability- beginning

1,985,761

Total OPEB liability- ending

$

2,218,083

$

2,305,113

$

2,770,086

$

3,178,694

$

2,179,955

$

1,846,603

Covered Employee Payroll

$ 12,533,653

$ 12,472,516

$ 12,982,682

$ 13,704,330

$ 14,047,001

$ 15,240,076

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

17.70%

18.48%

21.34%

23.19%

15.52%

12.12%

Note: No Assets are accumulated in a trust to pay related benefits.

Assumption changes:

on updated 20-year municipal bond rates as of each measurement date. In 2022, the following benefit changes occurred: The discount rate was changed from 2.00% as of 12/31/2020 to 1.84% as of 12/31/2021 based on updated 20-year municipal bond rates as of each measurement date. analysis of inflation rates and forward looking market expectations. The payroll growth rate changed from 3.25% as of 12/31/2020 to 3.00% as of 12/31/2021 based on an updated historical analysis of inflation rates and forward looking market expectations. In 2023, the following benefit changes occurred: The discount rate was changed from 1.84% as of 12/31/2021 to 4.05% as of 12/31/2022 based on updated 20-year municipal bond rates as of each measurement date. The inflation assumption changed from 2.50% to 2.25% based on an updated historical In 2021, the following benefit changes occurred: The discount rate was changed from 2.75% as of 12/31/2019 to 2.00% as of 12/31/2020 based The discount rate was changed from 3.31% as of 12/31/2017 to 3.71% as of 12/31/2018 based 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 In 2018, the following benefit changes occurred: on updated 20-year municipal bond rates as of each measurement date. The discount rate was changed from 3.71% as of 12/31/2018 to 2.75% as of 12/31/2019 based on updated 20-year municipal bond rates as of each measurement date. In 2019, the following benefit changes occurred: to reflect the impact of the Affordable Care Act's Excise Tax 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 In 2020, the following benefit changes occurred: analysis of inflation rates and forward looking market expectations. 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 changed from 2.75% to 2.50% based on an updated historical

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