01-24-2022 Council Packet - Laserfiche WebLink

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City of Orono, Minnesota Notes to the Financial Statements December 31, 2020 Note 4: Defined Benefit Pension Plans - Statewide (Continued) G. Pension Liability Sensitivity The following presents the City’s proportionate share of the net pension liability for all plans it participates in, calculat ed using the discount rate disclosed in the preceding paragraph, as well as what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate 1 percentage point lower or 1 percentage point higher than the current discount rate: 1 Percent 1 Percent Decrease (6.50%)Current (7.50%)Increase (8.50%) General Employees Fund 2,613,550$ 1,630,764$ 820,045$ Police and Fire Fund 5,708,856 2,864,247 510,831 City Proportionate Share of NPL H. Pension Plan Fiduciary Net Position Detailed information about each pension plan’s fiduciary net position is available in a separately-issued PERA financial report that includes financial statements and required supplementary information. That report may be obtained on the Internet at www.mnpera.org. Note 5: Postemployment Benefits Other Than Pensions A. Plan Description The City provides a single-employer defined benefit health care plan to eligible retirees and their spouses. The plan offers medical coverage and is administered by Health Partners, Inc.. It is the City’s policy for Council to periodically review its medical coverage, and to obtain requests for proposals in order to provide the most favorable benefits and premiums for City employees and retirees. The City does not issue a publicly available repo rt. Inactive Plan Members or Beneficiaries Currently Receiving Benefit Payments 5 Active Plan Members 53 Total Plan Members 58 B. Funding Policy Retirees receiving benefits contribute 100 percent of their premium costs. Retirees and their spouses contribute to the health care plan at the same rate as City employees. This results in the retirees receiving an implicit rate subsidy. Contribution requirements are established by the City, based on the contract terms with HealthPartners, Inc. The required contributions are based on projected pay-as-you-go financing requirements. For the year ended December 31, 2020, the City’s average contribution rate was .5 percent of covered-employee payroll. For fiscal year 2020, the City contributed $30,694 to the plan. As of January 1, 2020, there were five retirees receiving health benefits from the City’s health plan.