Comprehensive Annual Financial Report - St. Tammany Parish ...

ST. TAMMANY PARISH GOVERNMENT
Notes to the Financial Statements 2010
been recorded. The Parish does appropriate funds yearly in the public health fund for any expenditure that may be needed.
In 2010, the Parish budgeted $3,000 and no expenditures were incurred.
E. Extraordinary Event
Fire Protection District No. 1
Fire Protection District No. 1 was forgiven of its entire Community Disaster Loan in the amount of $5,145,439.
F. Post-employment Benefits
Plan Description. St. Tammany Parish Government’s medical benefits are provided through an insured medical plan and
are made available to employees upon actual retirement. The plan is a single-employer defined benefit plan.
The employer pays only for the employee or retiree (not dependents) medical coverage. The employer pays 100% of the
employee coverage before retirement and a percentage of the retiree coverage varying depending on years of service at
retirement (25% for 10-15 years; 50% for 15-20 years; and, 75% for 20 years or more). The retirement eligibility
(D.R.O.P. entry) provisions are as follows: the earliest of 30 years of service; age 55 and 25 years of service; age 60 and
10 years of service; or, age 65 and 7 years of service. Complete plan provisions are contained in the official plan
documents.
Contribution Rates. Employees do not contribute to their post employment benefits costs until they become retirees and
begin receiving those benefits. The plan provisions and contribution rates are contained in the official plan documents.
Fund Policy. Until 2008, St. Tammany Parish Government recognized the cost of providing post-employment medical
benefits (St. Tammany Parish Government’s portion of the retiree medical benefit premiums) as an expense when the
benefit premiums were due and thus financed the cost of the post-employment benefits on a pay-as-you-go basis. In 2008,
2009 and 2010, respectively, St. Tammany Parish Government’s portion of health care funding cost for retired employees
totaled $90,194, $85,361and $97,042.
Effective with the Fiscal Year beginning January 1, 2008, St. Tammany Parish Government implemented Government
Accounting Standards Board Statement Number 45, Accounting and Financial Reporting by Employers for Post
employment Benefits Other than Pensions (GASB 45).
Annual Required Contribution. St. Tammany Parish Government’s Annual Required Contribution (ARC) is an amount
actuarially determined in accordance with GASB 45. The Annual Required Contribution (ARC) is the sum of the Normal
Cost plus the contribution to amortize the Actuarial Accrued Liability (AAL). A level dollar, closed amortization period of
30 years (the maximum amortization period allowed by GASB 43/45) has been used for the post-employment benefits.
The total ARC for the fiscal year beginning January 1, 2010 is $708,820, as set forth below:
Medical
Normal cost $294,324
30-year UAL amortization 414,496
Annual required contribution (ARC) $708,820
Net Post-employment Benefit Obligation. The table below shows St. Tammany Parish Government’s Net Other Postemployment
Benefit (OPEB) Obligation for fiscal year ending December 31, 2010:
Medical
Beginning Net OPEB Obligation 1/1/2010 $1,017,968
Annual required contribution 708,820
Interest on Net OPEB Obligation 39,801
ARC Adjustment (57,543)
OPEB Cost 691,078
Contribution 0
Current year retiree premium (97,042)
Change in Net OPEB Obligation 594,036
Ending Net OPEB Obligation 12/31/2010 $1,612,004
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