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What are the Governmental Accounting Standards Board's (GASB) reporting requirements for Other Post-Employment Benefit (OPEB) Plans? How can the Tegrit OPEB Funding Trust Program help? How does the employer benefit from this program? How are contributions determined? How will the assets be invested? Will the employer receive account statements? What are the Governmental Accounting Standards Board's (GASB) reporting requirements for Other Post-Employment Benefit (OPEB) plans?
GASB Statement 45 establishes accounting and reporting requirements for governmental employers providing retiree health care and other non-pension benefits for employees. While public entities are not required to prefund OPEB obligations, they may realize significant benefits by taking a proactive approach. << Back To Top How can the Tegrit OPEB Funding Trust Program help?
Tegrit OPEB Services offers a solution to satisfying GASB Statement 45 requirements by helping employers establish a 115 Governmental Trust to dedicate assets to fund their OPEB liabilities. Since GASB allows a higher rate of return on investments held in trust than for OPEB assets not held in trust, employers have a significant incentive for holding their assets in trust. Tegrit's program allows participating employers to: i) invest their assets in numerous diversified investment options and ii) use investment earnings to help pay for retiree health benefits and other post-employment benefits. << Back To Top How does the employer benefit from this program?
Creating an OPEB Funding Trust and dedicating assets for OPEB, benefits the employer by i) helping the employer address issues related to GASB 45, ii) funding future OPEB costs in advance which allows earnings from trust investments to help reduce employer OPEB costs, iii) utilizing long-term investment rate of return assumptions, also known as discount rate assumptions, which may reduce annual expenses and unfunded liabilities for OPEB costs, iv) allowing the employer that proactively sets aside assets to take advantage of Tegrit’s investment options, v) preventing the employer’s OPEB obligation from becoming a significant liability on its balance sheet, vi) lowering unfunded liabilities that may result in higher bond ratings for the employer, and vii) ensuring that plan assets are used for the exclusive benefits of those participants entitled to OPEB and are not subject to creditors’ claims or diverted for other purposes such as budgetary emergencies.
<< Back To Top How are contributions determined?
Each participating employer will solely determine the contribution structure for the funding of its OPEB Funding Trust. The sole contribution method will be “pay as you go” cash funding. << Back To Top How will the assets be invested?
Assets in the program will be invested in Tegrit’s model portfolios created in conjunction with the Municipal Employees' Retirement System (MERS) of Michigan that are designed to allow diversification and custom allocations. << Back To Top Will the employer receive account statements and year-end reports?
Yes, the participating employer will receive quarterly account statements and a year-end report. << Back To Top Contact Tegrit Financial Group to obtain more details about Tegrit OPEB Services.
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OPEB Funding Trust 
