Notes to Financial Statements

5) Postretirement Benefits other than Pensions (OPEB)

General Information about the OPEB Plan Plan Description and Benefits Provided

By City Council authorization, the City provides all employees eligible to retire under PERSI, a $10,000 life insurance policy, the premium of which is paid for by the City. Additionally, the City contributes $100 per month toward a retiree health insurance plan for retirees under the age of 65 and is administered as part of the Boise Municipal Health Care Trust (Health Trust). For post-65 retirees, the City contributes $50 per month towards a City-offered Medicare Advantage plan which is administered through an agreement with a third-party administrator. Retiring employees working 20 hours/week or more have accrued vacation and sick leave paid into their individual VEBA account. These health benefits are provided as a defined benefit post employment healthcare plan (the Plan). Amounts related to the proprietary fund types are accounted for separately in those funds. This is a single employer plan and all changes and/or amendments to the plan require City Council approval. The decision on funding methodology resides with the Mayor and the City Council. There is no separate trust through which benefits for retirees are funded. However, assets are currently earmarked for this purpose. All approved benefits are paid from the City’s general assets, when due on a pay-as-you-go basis.

Employees Covered by Benefit Terms

At September 30, 2022, the following employees were covered by the benefit terms:

Total OPEB Liability

The City’s total OPEB liability of $12,225 was measured as of September 30, 2022, and was determined by an actuarial valuation as of September 30, 2022.

Actuarial Methods and Assumptions

The total OPEB liability in the September 30, 2022 actuarial valuation was determined using the following actuarial assumptions and other inputs, applied to all periods included in the measurement unless otherwise specified:

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• The percentage of eligible retirees electing spousal health coverage is 30% for general employees and 20% for fire and police employees.

• The termination rates for general employees are based on the July 1, 2022 Public Employees Retirement System of Idaho assumptions. Termination rates for fire and police employees are based on Boise City historical data.

• Employees are assumed to retire based upon the July 1, 2022 Public Employees Retirement System of Idaho assumptions.

• The discount rate was based on the Bond Buyer General Obligation 20-Year Municipal Bond Index.

• Mortality rates were based on Pub-2010 using the valuation for contributing members, members retired for service, and beneficiaries with generational projection scale adjustments. The projection scales are calculated at each age as the 60-year geometric average of the mortality improvement rates reported by the Social Security Administration from 1957 through 2017 (blended 50% female, 50% male).