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CITY OF EUGENE, OREGON <br /> <br />Notes to Basic Financial Statements <br /> <br />continued <br />(5) Other Information, continued <br /> <br /> (E) Other Post-Employment Benefits (OPEB) – Retirement Health Insurance Account (RHIA), continued <br /> <br />Depletion Date Projection, continued <br /> <br />The following circumstances justify an alternative evaluation of sufficiency for PERS: <br /> <br /> PERS has a formal written policy to calculate an Actuarially Determined Contribution (ADC), which is articulated <br />in the actuarial valuation report. <br /> The ADC is based on a closed, layered amortization period, which means that payment of the full ADC each year <br />will bring the plan to a 100% funded position by the end of the amortization period if future experience follows <br />assumption. <br /> GASB 75 specifies that the projections regarding future solvency assume that plan assets earn the assumed rate <br />return and there are no future changes in the plan provisions or actuarial methods and assumptions, which <br />means that the projections would not reflect any adverse future experience which might impact the plan’s funded <br />position. <br /> <br />Based on these circumstances, it is our independent actuary’s opinion that the detailed depletion date projections <br />outlined in GASB 75 would clearly indicate that the Fiduciary Net Position is always projected to be sufficient to cover <br />benefit payments and administrative expenses. <br /> <br />Sensitivity of the City's proportionate share of the net OPEB asset (liability) to changes in the discount rate <br /> <br />The following presents the City's proportionate share of the net OPEB asset (liability) calculated using the discount <br />rate of 7.5%, as well as what the City's proportionate share of the net OPEB asset (liability) would be if it were <br />calculated using a discount rate that is 1 percentage-point lower (6.5%) or 1 percentage-point higher (8.5%) than the <br />current rate: <br /> <br />Current <br />1% decrease discount rate 1% increase <br />(6.5%) (7.5%) (8.5%) <br />City’s proportionate share of the net <br /> OPEB asset (liability) $ (58,929) 422,740 832,428 <br />OPEB plan fiduciary net position <br /> <br />Detailed information about the OPEB plan's fiduciary net position is available in the separately issued OPERS <br />financial report <br /> <br />Changes in Assumptions and Other inputs <br /> <br />Changes in actuarial methods and assumptions implemented since the December 31, 2013 valuation are described in <br />the 2014 Experience Study (Study), published September 2015. <br /> <br />Changes in assumptions from that Study are reported in the table of actuarial methods and assumptions on page 71. <br />Modifications to the allocation of actuarial accrued liabilities, administrative expense assumptions, healthcare cost <br />inflation, and mortality tables can be found in the Study at: http://www.oregon.gov/PERS/Pages/Financials/Actuarial- <br />Presentations-and-Reports.aspx. <br /> <br />Changes in Plan Provisions Subsequent to Measurement Date <br /> <br />At its July 28, 2017 meeting, the PERS Board lowered the investment return assumption to 7.2%. The rate takes <br />effect January 1, 2018. <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />79 <br />December 10, 2018, Meeting - Item 2D