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CITY OF ELK RIVER, MINNESOTA <br />NOTES TO THE FINANCIAL STATEMENTS <br />DECEMBER 31, 2018 <br />D. Changes in the Total OPEB Liability (Continued) <br />Utility - URHP <br />• The discount rate was changed from 3.81% to 3.31%. <br />• Withdrawal rates were updated from the Small Plan age -based table in the 2003 SOA Turnover, adjusted by <br />50% to the rate used in the 7/1/17 PERA General Employees Retirement Plan valuation. <br />• The health care trend rates were reset to reflect updated cost increase expectations, including an adjustment to <br />reflect the impact of the Affordable Care Act's Excise Tax on high-cost health insurance plans. <br />• Medical per capita claims cost were updated to reflect recent experience. <br />• The salary scale assumption was changed from a flat rate of 3.25% to the rates used in the 7/1/2017 PERA <br />General Employees Retirement Plan valuation. <br />E. Sensitivity of Total OPEB Liability <br />The following presents the total OPEB liability, as well as what the net OPEB liability would be if it were calculated <br />using a discount rate the 1 -percentage point lower or 1 -percentage point higher than the current discount rate: <br />City - MRHP <br />Net OPEB Liability <br />Utility - URHP <br />Net OPEB Liability <br />1% Decrease <br />(230%) <br />$ 987,172 <br />1% Decrease <br />(231%) <br />$ 110,190 <br />Discount Rate <br />(330%) <br />$ 916,510 <br />Discount Rate <br />(331%) <br />$ 100,572 <br />1% Increase <br />(430%) <br />$ 850,859 <br />1% Increase <br />—(4.31%) <br />$ 91,750 <br />The following presents the net OPEB liability, as well as what the net OPEB liability would be if it were calculated <br />using healthcare cost trend rates that are 1 -percentage point lower or 1 -percentage point higher than the current <br />healthcare cost trend rates: <br />City - MRHP <br />Net OPEB Liability <br />Utility – URHP <br />Net OPEB Liability <br />1% Decrease <br />(525% decreasing <br />to 4%) <br />$ 819,491 <br />1% Decrease <br />(5.9% decreasing <br />to 3.4%) <br />$ 87,443 <br />70 <br />Healthcare Cost <br />Trend Rates <br />(625% decreasing <br />to 5%) <br />$ 916,510 <br />Healthcare Cost <br />Trend Rates <br />(6.9% decreasing <br />to 4.4%) <br />$ 100,572 <br />1% Increase <br />(725% decreasing <br />to 6%) <br />$ 1,030,114 <br />1% Increase <br />(7.9% decreasing <br />to 5.4%) <br />$ 116,283 <br />