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Finance Department <br />~~C~ <br />June 25, 2007 <br />To: Board of County Commissioners <br />From: Pamela S. Dubois, Deputy County Manager 4 <br />Subject: New Accounting Procedures for Other Post employment Benefits (OPEB), <br />Retiree Health Insurance and Life Insurance <br />The topic of this memo is to provide the history of retiree health insurance at Cabarrus <br />County and the recent issuance of Governmental Accounting Standazds Boazd (GASB) <br />Statements 43 and 45 (financial reporting issues) ,which require governments that <br />provide OPEB to report the liability that is accruing to retirees and potential retirees. The <br />guidance does NOT require governments to pre-fund such plans, but simply to identify <br />the cost of the plans themselves. <br />History <br />On July 1, 1997, the Boazd of County Commissioners approved aCounty- paid basic <br />group health and life insurance coverage for employees who retire as members of the <br />North Carolina Local Governmental Employees' Retirement System with at least their <br />last ten (10) years of creditable service at Cabarrus County. This benefit is paid at the <br />same level of active employees. It will be provided to retired employees until they <br />become eligible for Medicare (or reach the age where they would have had such benefits <br />if they had been qualified for Social Security). Employees qualifying for retirement in the <br />North Cazolina Local Governmental Employees' Retirement System with less than ten <br />(10) years of service with Cabarrus County will receive health and life insurance <br />coverage for 50% of the actual premium. <br />The policy was modified by the Board, effective November 1, 2003 and now reads as <br />follows: <br />County will pay basic group health and life insurance coverage for employees who retire <br />as members of the North Carolina Local Governmental Employees' Retirement System <br />with at least the last twenty-five (25) of creditable service at Cabarrus County. This <br />benefit is paid at the same level of active employees and is provided to retired employees <br />until they become eligible for Medicaze (or reach the age where they would have had <br />such benefits if they had been qualified for Social Security). Employees qualifying for <br />retirement in the North Carolina Local Governmental Employees' Retireme stem <br />~"q~~~>~M~ <br />Finance Department ~7fY/f~~ I lW <br />P.O. Box 707 • Concord, NC 28026-0707 • 704-920-2104 • www.cabarruscounty.us rhpCeMer b Nnakan Maaspwb+ <br />NORiN CAROLINA <br />