06-04-2018 Council Work Session Packet

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CITY OF LINO LAKES, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2017 Based on past experience of the plan, 90% of future retirees are assumed to continue medical coverage until age 65. 50% of police/fire employees are assumed to retire at age 55, the balance at age 65. 50% of other City employees are assumed to retire at age 62, the balance at age 65. F. SENSITIVITY OF THE TOTAL OPEB LIABILITY TO CHANGES IN THE DISCOUNT RATE The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability would be if it were calculated using a discount rate that is 1% lower (1.85%) or 1% higher (3.85%) than the current discount rate: 1% Decrease Discount Rate 1% Increase (1.85%)(2.85%)(3.85%) Total OPEB liability $831,489 $746,540 $671,756 G. SENSITIVITY OF THE TOTAL OPEB LIABILITY TO CHANGES IN THE HEALTHCARE COST TREND RATES The following presents the total OPEB liability of the City, as well as what the City’s total OPEB liability would be if it were calculated using healthcare cost trend rates that are 1% lower (7% decreasing to 2%) or 1% higher (9% decreasing to 4%) than the current healthcare cost trend rates: Healthcare Cost 1% Decrease Trend Rates 1% Increase (7% decreasing to 2%) (8% decreasing to 3%) (9% decreasing to 4%) Total OPEB liability $661,327 $746,540 $845,440 H. OPEB EXPENSE AND DEFERRED OUTFLOWS AND INFLOWS OF RESOURCES RELATED TO OPEB For the year ended December 31, 2017, the City recognized $39,532 of OPEB expense. At December 31, 2017, the City reported deferred outflows and inflows of resources related to OPEB from the following sources: Deferred Outflows Deferred Inflows of Resources of Resources Differences between expected and actual experience $0 $51,083 77