At its regular meeting on Monday, May 6, 2013, the Board of Selectmen voted to approve the following charge of the OPEB Advisory Committee:
MEMBERS: Five members chosen by and reportable to the Board of Selectmen whose commission shall serve until such time as the following goals are achieved or a date no later than June 1, 2015: one member from the Finance Committee, one member from the Personnel Board, and three independent members from the public whose selection will be based upon their qualifications as deemed appropriate by the Board. (At its regular meeting on Monday, May 11, 2015, the Board of Selectmen voted to extend the charge of the committee members to September 30, 2015.)
GOALS: Evaluate and document a clear understanding of how the town’s fiduciary responsibilities are currently being carried out. Evaluate and develop as necessary appropriate trust fund documents to protect the beneficiaries, review the current investment management and funding policies and make recommendations for improvement or revisions, review and recommend improvements to current reporting or develop additional reporting to ensure appropriate benchmarks and performance indicators for investments and to provide regular fund financial reports. Develop a plan for containing current and long-term costs for OPEB including retiree health care benefits and for coordinating with the Commonwealth of Massachusetts on effective cost containment and other legislation.
1. Review and evaluate all current OPEB documents and develop appropriate policy documents, guidelines and trust documents as required.
2. Evaluate current investment management policy and funding plan and recommend and develop future policy changes.
3. Evaluate current financial reporting and develop reporting policy and standards. Create financial reporting model and metrics as deemed necessary for internal management and public disclosure including for Annual Town Meeting and Annual Town Report. Develop appropriate benchmarks and performance indicators to assist in appropriate funding and management planning.
4. Review existing financial information and verify key amounts as deemed necessary, including a determination of the actual amounts paid for health insurance benefits for current retirees for FY 2012 and FY 2013 and any other relevant periods as deemed necessary. Work with the Town’s Finance Director, Board of Selectmen, Finance Committee and if necessary the Audit committee to recommend the services of any independent insurance advisors and/or auditor to perform special procedures as deemed necessary, such procedures may include the following:
- Review all current OPEB beneficiaries to ensure they are qualified for the benefits they are receiving under state law and related contractual obligations of the Town, .
- Review the annual costs paid for current retiree benefits to determine proper segregation of costs between School, Town and Fee Payors, and evaluate data to assure proper segregation of the annual funding of OPEB obligations.
- Analyze premiums paid on behalf of current retirees compared to standard premium rates for active employees and compare amounts to actuarial assumptions to properly calculate the annual costs of benefits paid for retirees for both fiscal 2012 and FY 2013. Analyze results to properly ensure that amounts paid by active employees does not include a disproportionate amount of funding for retiree health benefits. Analyze information to evaluate assumptions used for actuarial valuations and OPEB obligations.
- Conduct an analysis of data to determine if any amount of OPEB funding was provided by taxpayers on behalf of fee-based program staff and evaluate methods of reimbursement and recommendations for future policy changes.
5. Evaluate current personnel management plan and cost containment and mitigation plans to include appropriate coordination with the Board of Selectmen on employee contractual obligations and negotiations.
6. Evaluate and advise the Board of Selectmen on matters with the Commonwealth of Massachusetts and GASB with respect to proposed legislation and regulations/standards related to future OPEB obligations and reporting.
7. Recommend statutory and bylaw amendments as necessary to effect such changes.