California Comprehensive Annual Financial Report - City of Temecula

City of Temecula
Notes to Financial Statements (Continued)
Note 14: Post Employment Benefits (Continued)
The schedule of funding progress below presents multiyear trend information about
whether the actuarial value of plan assets is increasing or decreasing over time relative to
the actuarial accrued liabilities for benefits. Only two years are presented as this is the
second year of the plan.
Unfunded
UAAL as a
Actuarial Actuarial Actuarial Actuarial Percent of
Type of Valuation Value of Accrued Accrued Funded Covered Covered Interest Salary
Valuation Date Assets Liabilities Liability Ratio Payroll Payroll Rate Scale
Actual 7/1/2007 $ - $ 3,572,029 $ 3,572,029 0.0% $ 13,069,614 27.33% 7.75% 3.25%
Actual 7/1/2008 3,286,043 3,629,275 343,232 90.5% 13,897,746 2.47% 7.75% 3.25%
Actuarial Methods and Assumptions
Note 15: Contingencies
Projections of benefits for financial reporting purposes are based on the substantive plan
(the plan as understood by the employer and the plan members) and include the types of
benefits provided at the time of each valuation and the historical pattern of sharing of
benefit costs between the employer and plan members to that point. The actuarial
methods and assumptions used include techniques that are designed to reduce the effects
of short-term volatility in the actuarial accrued liabilities and the actuarial value of assets,
consistent with the long-term perspective of the calculations.
In the July 1, 2008, actuarial valuation, the Individual Entry Age actuarial cost method was
used. The actuarial assumptions include a 7.75% investment rate of return, which is a
blended rate of the expected long-term investment return on plan assets and on the
employer’s own investments calculated based on the funded level of the plan at the
valuation date, and annual healthcare cost trend rate of 4.5%. The actuarial value of
assets is set equal to the reported market value of assets. The UAAL is being amortized
as a level percentage of payroll on an open basis. The remaining amortization period at
June 30, 2009, was twenty-eight years. The number of active participants is 215.
$51,250,000 Temecula Public Financing Authority Community Facilities District No. 03-02
Roripaugh Ranch), 2006 Special Tax Bonds
The master developer of the land within Temecula Public Financing Authority Community
Facilities District No. 03-02 (Roripaugh Ranch) (the Community Facilities District) is Ashby
USA, LLC, a California limited liability company, which, as of September 14, 2007, is the
current owner of land that has approximately 81.33% of the estimated special tax liability
with respect to the Community Facilities District. The special taxes to be levied in the
Community Facilities District are the primary source of funds to repay the Bonds, In
connection with the issuance of the Bonds, Ashby USA, LLC advised the Authority that it
is managed by Ashby Development Company, Inc., a California corporation, one of the
members of Ashby USA, LLC The City and Ashby USA, LLC entered into a Development
Agreement for development of the Project in December 2002.
Ashby USA, LLC also identified USA Investment Partners, LLC, a Nevada limited liability
company as another member of Ashby USA, LLC. The Authority also has been advised by
Ashby USA, LLC that USA Investment Partners, LLC made a loan to Ashby USA, LLC in
the principal amount of $4,250,000 which is secured by a junior deed of trust on property
within the Community Facilities District. The Authority has been further advised that USA
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