Report details Texas OPEB findings.

• Position: News & Numbers

A new report, NCTCOG Aggregate OPEB Report, summarizes the most recent findings for 107 Texas employers. This summary;, prepared by Gabriel Roeder Smith & Company for the North Central Texas Council of Governments, was created to allow employers to compare their results to those of other member organizations and to see which benefit provisions employers are amending to manage their OPEB liabilities.

The report provides data and analysis in five sections: Percentiles Based on ARC per Active Employee; Size of Governments; Size of Plans and Types of Insurance; Types of Benefit Provisions; and Average Claims Cost and Future Trend. Based on the feedback from the previous year's report, most key results are presented in total and are also broken out by subgroups, allowing users to better compare their results with those of their peer groups.

The median actuarially required contribution (ARC) per active member is $1,100, and the average is $2,347, according to the report. The average cost is considerably more than the median because of large outliers. Although it is generally true that a more generous plan will have a higher ARC per active employee, this is not always the case. Some employers have grandfathered a group of employees and as a result can no longer use a 30-year, growing amortization of the unfunded accrued liability because the bulk of the liability will be paid out in less than 30 years. Not allowing new hires to participate or grandfathering a certain group of employees will provide savings in the long run but will often have a minimal impact on the actuarial accrued liability and might increase the ARC due to the required change to the amortization method.

The...