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OPEB Studies

Click on the titles below to open the PDF.

2007 Other Post-Employment Benefits (OPEB) Actuarial Valuation Report [644kb]

2007 LEOFF 1 Medical Benefits Study [974kb]

Please note that PDF files are best viewed using Adobe Reader’s latest version. Click on the icon below to access free updates:

OPEB Calculation Tool - Version 1.1

OSA developed several tools (spreadsheets) for use by local governments to calculate OPEB costs for LEOFF 1 and PEBB plans.

NOTE:  Please read the Instructions document first.  When accessing the tools, please download them to your computer first and do not rename the file.

OPEB Calculation Tool Instructions

LEOFF 1 GASB 45 Tool

PEBB GASB 45 Tool

Changes in OPEB Reporting

New financial reporting requirements in Governmental Accounting Standards Board (GASB) Statement 45, entitled "Accounting and Financial Reporting by Employers for Post Employment Benefits Other Than Pensions," cause concern for many public entities.  The following Q & A should help the preparers of financial statements for local governments satisfy the new requirements.

Frequently Asked OPEB Questions

• Does GASB 45 Apply to My Entity?

• When Does Reporting Begin Under GASB 45?

• How Do Entities Determine OPEB Costs?

• My Entity has Fewer than 100 Members in its OPEB Plan.  Can I Perform the Alternative Calculation to Determine My Entity’s OPEB Costs?

• How Often Do OPEB Costs Need to be Determined?

• I Represent a Local Government. Can we Use the "2007 LEOFF 1 Medical Benefits Study" Performed by the Office of the State Actuary (OSA) to Report Our LEOFF 1 OPEB Liability?

• Who Prepared this Information?

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Does GASB 45 Apply to My Entity?

If your entity does both of the following, GASB 45 applies. Does your entity:

• Report financial statements using Generally Accepted Accounting Principles (GAAP basis)?

• Offer Other Post Employment Benefits (OPEB) subsidies?  These could be direct subsidies like paying for health related benefits, insurance, or long-term health care to retirees.  Besides these direct payments to members, grouping retirees and active members together for the purpose of determining premiums qualifies as providing an indirect subsidy.

Examples of entities where GASB 45 may apply – those who:

• Have LEOFF 1 members.

• Belong to the state-run Public Employees Benefits Board (PEBB) retiree-medical plan.

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When Does Reporting Begin Under GASB 45?

It depends on the gross annual revenue of your entity in the fiscal year ending after June 15, 1999.

If your entity had 1999 revenues of $100,000,000 or more, your entity will first report in Phase 1.  Phase 1 begins the first fiscal period ending after December 15, 2006.

If your entity had 1999 revenues of less than $100,000,000, but more than $10,000,000, your entity will first report in Phase 2.  Phase 2 begins the first fiscal period ending after December 15, 2007.

If your entity had 1999 revenues of less than $10,000,000, your entity will first report in Phase 3.  Phase 3 begins the first fiscal period ending after December 15, 2008.

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How do Entities Determine OPEB Costs?

It depends on how many members your entity’s OPEB plan contains.

If your entity’s OPEB plan has 100 or more members, GASB 45 requires you to have an actuary determine the costs of the plan by performing an actuarial valuation.

If your entity’s OPEB plan has fewer than 100 members, GASB 45 provides TWO options for determining the costs of your plan. You can either have:

1. An actuary perform an actuarial valuation of the plan.

2. Do the valuation yourself using simplified assumptions and calculations permitted under GASB's "alternative measurement method."

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My Entity has Fewer than 100 Members in its OPEB Plan.  Can I Perform the Alternative Calculation to Determine My Entity’s OPEB Costs?

Yes.

The Office of the State Actuary (OSA) will develop an interactive-online tool for use by local governments.  We will complete the tool and have it available on our website early in 2008.  We intend for employers who either employ LEOFF 1 members or participate in PEBB to use this tool.  The tool requires that you input the following data from the members in your OPEB plan:

• Total number of members.

• Average age.

• Average service.

• Percent of members who are male/female.

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How Often do OPEB Costs Need to be Determined?

It depends on how many members your entity’s OPEB plan contains.

If your entity’s OPEB plan has 200 or more members, GASB 45 requires you to determine costs at least every two years.

If your entity’s OPEB plan has fewer than 200 members, GASB 45 requires you to determine costs at least every three years.

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I Represent a Local Government.  Can we Use the "2007 LEOFF 1 Medical Benefits Study" Performed by the Office of the State Actuary (OSA) to Report Our LEOFF 1 OPEB Liability?

No.

The OSA LEOFF 1 study reports the state-wide LEOFF 1 OPEB liability.  GASB 45 requires individual entities to report their OPEB liability.  To see how your entity can have these costs calculated see the entry, “How do Entities Determine OPEB Costs?” above.

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Who Prepared this Information?

Phillip Parks, CPA, Assistant Audit Manager from the Washington State Auditor’s Office assisted in the preparation of this FAQ.  Troy Dempsey, Actuarial Assistant, from the Office of the State Actuary, provided technical assistance.

If you have other questions about reporting under GASB please e-mail either:

Troy Dempsey at dempsey.troy@leg.wa.gov

Phillip Parks at parksp@sao.wa.gov