City of Raleigh
All active full‐time employees are eligible for membership. At December 31, 2015, the plan membership consisted of:
Law enforcement officers
Summary of significant accounting policies:
The City pays the full cost or almost full cost of coverage, depending on coverage plan selected, for
health care and life insurance benefits, and a $100 monthly Medicare supplement for eligible retirees. The City has
chosen to fund the plan benefits based on an actuarially determined annual required contribution. For the current
year the City contributed $13,949,558 or 7.0% of the annual covered payroll. Contributions made by retirees for
dependent coverage and Medicare supplement premiums were $2,271,037.
Basis of Accounting
Financial statements for the plan are prepared using the accrual basis of accounting.
Employer contributions are recognized when due and when the City has made a formal commitment to provide
contributions. Benefits are recognized when due and payable in accordance with the plan terms.
Method used to Value Investments
The City pools money from several funds, including the OPEB trust fund. All
such pooled cash and investments are considered cash and cash equivalents, which approximates fair value.
The City’s annual pension cost and net OPEB obligation for the current year were as follows:
Employer annual required contribution
Interest paid on OPEB obligation
Adjustment to annual required contribution
Annual OPEB cost
Employer contributions made for current fiscal year
Increase in net OPEB obligation
Net OPEB (asset) obligation beginning of fiscal year
Net OPEB (asset) obligation end of fiscal year
The annual required contribution for the current year was determined as part of the December 31, 2015 actuarial
valuation using projected unit credit actuarial cost method. The actuarial assumptions included (a) 7.0% investment
rate of return and (b) projected medical cost trend rates of 7.75% to 5.0%, including an inflation component of 3.0%.
The actuarial value of assets was market value. The unfunded actuarial accrued liability is being amortized as level
percentage of pay on a closed basis. The remaining amortization period was 23 years.