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Financial Strateg Session February 14, 2013 Page 3 Water Costs The Distnct`s�.'ater costs ;+ave increased rar,a ',--ali+ _ even. as the s°,�znunt'1#vv- ate r -n Distri c` uses On a ''per ac;e' basis ha: acfirJed AithCLC-ho he race. of V.'at.?' Nrica Increases is expected t! SIS`.;, caverin in'crsasEd 3�'eis y+td7r. limited .,r' zar=y tax increases 's a challenge Pension Costs Market forces and s-.,anges in CaIPERS actuarial a$sumpti0r�7 are driving ircrsases in pension costs. As noted above, the District remained in conservative formulas and re;^:2- employees do not receive full pension bsrefits until age 67. The Employer's share of pension costs is estimated tc rise from S.6% of payroll tc approximately 11.0% by -0 ,7-t3, Health Care NlIarl: provisiorsof -he Fstlart Prnacti^r'so-a fi raiable 09reAc" (PPACA ✓ V VV. \}. Wl r I M V V J Jn'1 i as "H'sal-t:hc9-9 Ref_"rm A •c#cr rse-,;a .affective on .a'Lary `+ 0,:mer 'hers ars 3tiPM 3eV�'a! , :Ieiie, Fat►^!" s3L53+ 'C+c� L"'ss *1 at tere i',:*, j"$; j:,Csljr definej �Di3'!r!c' st a!= riLin '--03 t "':?. if :+r 3 s,7 o!L): `"i en:s :'f �i+-fA. as well as +.rs'.PEi?� 3 r?spt7n5e .o it_ in <rdyr n manage ,?s ffsc-r on tip Dist.w=�` Other Post-Emp`'cyment Benefits - ReVree Med}cai (OPEB - GASB 45) in its actuarial raptor; as of -I0v ' 2011, the District's Ur%rded Actuarial Acc�-aed Liability was estimated to be bst teerp 475 millior; and $5.0 million depending on the investment earnings (discount rate) the funds are p_.-oia.c1er_i to generate. The Normal Cost ranges from $192,000 to 5325=0 arnua''y in 2008, the Board approvea, _e`tirg aside $3.7 million to fund file accrued costs along w& annually budgeting ar estimated amourt fnr each year's cost The dif#er'er.cs between the annually budgeted amount anti the amount actually paid to retirees each •gear has been added to the initial reserve, vvhich totals $4.6 million as of June 30, 2012. The District considw~ed and has determined not to put these ressr,. e funds into an rre: ocaE✓;a trust with CaIPERS There are other methods b.,- which fund the increasirr annual ccsts and remaining 11abiliv outsite of CaIPERS. The State Budget vVitn the passage of Prop 30 and the slowly improving economy, current reports indicate that the State yf California will not be iookirta to local government for resources this year. 711e `" Employees new to CaIPERS system w NNith a gap in service exceeding 6 montk.s. HILLCR=3TCEr'iTER_ ar• +E3T -1 RR -ST E. T 4:,"�:� CS!+_ F:cRf.I A 'D1360 4223