7998-R1_ML&P_Hollis_2020-2021_AnnualReport_Web

TOWN OF HOLLIS, MAINE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2021

NOTE 12 - OTHER POST EMPLOYMENT BENEFIT (OPEB) PLAN (CONTINUED) Retiree Continuation Percentage : Medicare participant retirees - 100% assumed to continue in the plan elected Pre-Medicare plan retirees and active participants - 75% assumed to continue coverage once Medicare-eligible Pre-Medicare plan spouses and spouses of active participants - 50% assumed to continue coverage once Medicare-eligible Changes in Net OPEB Liability Changes in net OPEB liability are recognized in OPEB expense for the year ended June 30, 2021 with the following exceptions: Differences between Expected and Actual Experience The difference between expected and actual experience are recognized in OPEB expense using a straight-line amortization method over a closed period equal to the average expected remaining service lives of active and inactive members in each plan. The first year is recognized as OPEB expense and the remaining years are shown as either deferred outflows of resources or deferred inflows of resources. The difference between expected and actual experience as of January 1, 2021 was $17,654. Changes in Assumptions Differences due to changes in assumptions about future economic, demographic or claim and expense factors or other inputs are recognized in OPEB expense using a straight-line amortization method over a closed period equal to the average expected remaining service lives of active and inactive members in each plan. The actuarial assumptions used in the June 30, 2017 and June 30, 2016 actuarial valuations were based primarily on those used by Maine State Retirement Consolidated Plan for Participating Local District at June 30, 2016 which were based on the experience study covering the period from June 30, 2012 through June 30, 2015. The first year is recognized as OPEB expense and the remaining years are shown as either deferred outflows of resources or deferred inflows of resources.

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