Laserfiche WebLink
Elk River Municipal Utilities <br />Elk River, Minnesota <br />Notes to the Financial Statements <br />December 31, 2019 <br />Note:Postemployment Benefits Otherhan Pensions <br />D.Changes in the Total OPEB Liability <br />Total OPEB <br />Liability <br />(a) <br />Balances at December 31, 2018$100,572 <br />Changes for the Year: <br />Service cost12,750 <br />Interest3,751 <br />Differences between expected and actual experience(3,832) <br />Changes in assumptions or other inputs104,531 <br />Net Changes117,200 <br />Balances at December 31, 2019$217,772 <br />Since the prior measurement date, the following assumptions changed: <br />The discount rate was changed from 3.31% to 3.71%. <br />Mortality, withdrawal and salary scale updated to the rates used in the July 1, 2018 PERA of Minnesota Retirement <br />Plan actuarial valuation to reflect recently-published tables. <br />Medical per capita claims costs were updated to reflect recent experience. <br />The assumed retirement age was updated from 60 to 57 to reflect recent experience. <br />The inflation assumption was changed from 2.75% to 2.50% based on an updated historical analysis of inflation <br />rates and forward-looking market expectations. <br />Health care trend rates were reset to reflect updated cost increase expectations, including an adjustment to reflect <br />the impact of the Affordable Care Act's Excise Tax on high-cost health insurance plans. <br />E.Sensitivity of the Total OPEB Liability <br />The following presents the total OPEB liability of the Utilities, as well as what the Utilities’total OPEB liability would be if it <br />were calculated using a discount rate that is 1-percentage point lower (2.71percent) or 1-percentage-point higher (4.71 <br />percent) than the current discount rate: <br />1 Percent1 Percent <br />Decrease (2.71%)Current (3.71%)Increase (4.71%) <br />$237,862$217,772$199,558 <br />The following presents the total OPEB liability of the Utilities, as well as what the Utilities’total OPEB liability would be if it <br />were calculated using a Healthcare Cost Trent Rates that is 1-percentage point lower (5.40percent decreasing to 3.00 <br />percent) or 1-percentage-point higher (7.40percent increasing to 5.00percent) than the current discount rate: <br />Healthcare Cost <br />1 Percent DecreaseTrend Rates1 Percent Increase <br />(5.4% Decreasing(6.4% Decreasing(7.4% Decreasing <br />to 3%)to 4%)to 5%) <br />$194,867$217,772$244,554 <br />48 <br />138 <br />