Distrito Escolar del - Osceola County School District

The District has set aside “contingency reserves” as per School Board Rule 7.10 to help sustain the financial
stability of the District during times of emergency spending for items such as disaster recovery and revenue
shortfalls that could potentially occur after the current year’s budget adoption. School Board Rule 7.10
requires an amount equal to 6 percent of the current year’s annual estimated general fund revenues to be
reserved for contingency purposes. The Superintendent shall obtain approval from the School Board if at
any time it is projected that this balance will not be maintained. The contingency funds of $21,700,000 are
included as part of the unassigned general fund balance of $52,631,593.
14. OTHER POSTEMPLOYMENT BENEFITS PAYABLE
Plan Description. The Other Postemployment Benefits Plan (Plan) is a single-employer defined benefit
plan administered by the District. Pursuant to the provision of Section 112.0801, Florida Statutes, employees
who retire from the District, and eligible dependants, may continue to participate in the District’s health and
hospitalization plan for medical and prescriptions and life insurance coverage. The District subsidizes the
premium rates paid by the retirees by allowing them to participate in the plan at the blended group (implicitly
subsidized) premium rates for both active and retired employees. These rates provide an implicit subsidy for
retirees because, on an actuarial basis, their current and future claims are expected to result in higher costs to
the plan on average than those of active employees. The District does not offer any explicit subsidies for
retiree coverage. Retirees are assumed to enroll in the Federal Medicare program for their primary coverage
as soon as they are eligible. The Plan does not issue a stand-alone report, and is not included in the report of
a Public Employee Retirement System or another entity.
Funding Policy. Plan contribution requirements of the District and Plan members are established and may
be amended through recommendations of the Insurance Committee and action from the Board. The
District has not advanced-funded or established a funding methodology for the annual other
postemployment benefit (OPEB) costs or the net OPEB obligation, and the Plan is financed on a pay-asyou-go
basis. For the 2011-12 fiscal year, 360 retirees received other postemployment healthcare benefits,
and another 179 retirees received only life insurance benefits. The District provided required contributions
of $2,118,105 toward the annual OPEB cost, net of retiree contributions totaling $1,911,895, which
represents 1 percent of covered payroll.
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