The visualization covers the funding status of non-pension retiree benefits, also known as Other Post-Employment Benefits (OPEBs), of California’s twenty largest cities. Start by selecting a variable from the “Select Variable” drop down menu. A selection of a different variable changes all three graphs. The first graph on the left shows a map of California with each circle representing the relative size of the selected variable for each city. The graph on the top right allows city to city comparison of the selected variable using the most recent data available. The bottom right graph shows how the selected variable has changed since 2008. There is wide range of values for these cities. You can click on a city in any graph to show just that specific city. To select more than one city, first hold down the “Ctrl” button on your keyboard and then select your desired cities. To reset, click on a blank space in the graph that you used to select the cities. In each graph, the color of the city also represents the relative size of the selected variable. These variables are:
· Actual Contribution as a Percent of the Annual Required Contribution: The Annual Required Contribution (ARC) refers to a suggested payment that, if paid each year, will pay off the unfunded liability and any costs for newly earned benefits. The actual contribution refers to what each city actually paid. A percentage of 100 means that the ARC was paid in full.
· Actual Contribution as a Percent of General Fund Expenditure: The actual contribution is the same as above. This value was divided by the general fund expenditure to show the relative strain that these costs have on each city’s budget.
· Actuarial Accrued Liability (AAL): The Actuarial Accrued Liability is the liability that is attributed to OPEBs that have already been earned. Essentially, this is the total cost of providing the already promised benefits that have been earned thus far.
· Funding Ratio: The funding ratio is calculated by dividing any assets that have been set aside to fund these benefits by the AAL. A funding ratio of 0% means that no assets have been set aside.
· Unfunded Actuarial Accrued Liability: The unfunded actuarial accrued liability represents the portion of the AAL that has no assets set to cover it (AAL minus the assets). A funding ratio of 0% means that the unfunded actuarial accrued liability is equal to the actuarial accrued liability.
For more background information and the implications of these values, see our report, “Preventive Care for Our Cities: How Pre-Funding and Policy Changes Can Help California’s 20 Largest Cities Manage Growing Retiree Benefit Costs”.
Source: These values come from the Comprehensive Annual Financial Reports (CAFR) of each city for fiscal years 2007-2008 to 2010-2011. The values relating to OPEBs can be found in the notes to financial statements in the Other Post-Employment Benefits sections. The general fund expenditures can be found in the major governmental fund balance sheets