Town of Stoughton Other Postemployment Benefits Plan. GASB 45 Actuarial Valuation. as of. January 1, For the fiscal years ending

Transcription

1 Town of Stoughton Other Postemployment Benefits Plan GASB 45 Actuarial Valuation as of January 1, 2013 For the fiscal years ending June 30, 2013 June 30, 2014 Delivered

2 TABLE OF CONTENTS LETTER SECTION PAGE I PRINCIPAL RESULTS OF THE VALUATION 1 II SUMMARY OF PLAN PROVISIONS 10 III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS 11 EXHIBITS A FINANCIAL STATEMENT DISCLOSURES 19 B RECONCILIATION OF PLAN PARTICIPANTS 30 C PROJECTED CASH FLOWS (OPEN GROUP) 31 D PROJECTED CASH FLOWS (OPEN GROUP) FUNDING 32 E GLOSSARY OF TERMS 33

3 March 5, 2014 Personal and Confidential Mr. William Rowe Town Accountant Town of Stoughton 10 Pearl Street Stoughton, MA Dear Mr. Rowe: We have performed an actuarial valuation of the Town of Stoughton Other Postemployment Benefits Plan for the fiscal year ending June 30, The figures presented in this report reflect the adoption, by the Town of Stoughton, of Statement No. 45 of the Governmental Accounting Standards Board ( GASB 45 ) effective July 1, The financial results of the actuarial valuation are summarized in the report. The Executive Summaries highlight the results of the valuation. Additional information summarizing census data, actuarial assumptions, claim rates and the methodology for developing them, as well as a glossary of selected terms used in this study, is also included in the report. All costs, liabilities and other factors under the plan were determined in accordance with generally accepted actuarial principles and procedures. In our opinion, the actuarial assumptions used are reasonable, taking into account the experience of the plan and reasonable expectations and, in combination, represent our best estimate of the anticipated experience under the plan. We refer you to Section I of this report for a detailed summary and commentary on the results of the valuation and a comparison with the prior valuation. Section II is a summary of the plan provisions, and Section III describes the actuarial cost method and assumptions. Details for cost calculations, supporting data, and disclosures are provided in Exhibits A through C. We will be pleased to answer any questions that you may have regarding this actuarial valuation report. Very truly yours, Parker E. Elmore, A.S.A., E.A., M.A.A.A. President & CEO Enclosure

4 SECTION I PRINCIPAL RESULTS OF THE VALUATIONs Town of Stoughton Assuming Pay-as-you-go funding % discount r ate Compar ison of Plan L iabilities to Pr ior Valuation Januar y 1, 2013 Januar y 1, 2011 I. Present Value of Future Benefits A. Actives 103,382, ,086,037 B. Retirees/Disabled 45,285,331 49,326,264 C. Total 148,667, ,412,301 II. Present Value of Future Normal Cost 40,642,711 31,729,288 III. Actuarial Accrued Liability (Projected Unit Credit) A. Actives 62,739,545 73,356,749 B. Retirees/Disabled 45,285,331 49,326,264 C. Total 108,024, ,683,013 IV. Plan Assets 0 0 V. Unfunded Actuarial Accrued Liability ("UAAL") 108,024, ,683,013 VI. Funded Ratio 0.00% 0.00% VII. Annual Covered Payroll 36,692,795 N/A VIII. UAAL as % of Covered Payroll % N/A IX. Net OPEB Beginning of Fiscal Year 19,649,919 9,893,009 X. Number of Eligible Participants A. Actives B. Retirees/Disabled C. Total 1,250 1,031 For the Fiscal Year Ending: June 30, 2013 June 30, 2011 XI. Normal Cost 4,254,207 3,994,026 XII. Amortization of UAAL - 30 year increase 3.25% per yr 4,632,552 4,345,504 XIII. Annual Required Contribution ('ARC') [ XI. + XII.] 8,886,759 8,339,530 XIV. Interest on Net OPEB Obligation 785, ,721 XV. Adjustment to Annual Required Contribution (1,092,653) (855,565) XVI. Amortization of Actuarial (Gains) / Losses (120,395) 369,532 XVII. Annual OPEB Cost [XIII. + XIV. + XV. + XVI.] 8,459,710 8,249,218 XVIII.Expected Employer Contribution 3,065,420 3,513,700 XIX. Percentage of Annual OPEB Cost Contributed 36.2% 42.6% XX. Net OPEB Obligation at Beginning of Year (IX.) 19,649,919 9,893,009 XXI. Increase in Net OPEB Obligations (XVII. - XVIII.) 5,394,290 4,735,518 XXII. Net OPEB Obligation at End of Year (XX. + XXI.) 25,044,209 14,628,527 XXIII.Discount Rate 4.00% 4.00% Page 1

5 SECTION I PRINCIPAL RESULTS OF THE VALUATION Town of Stoughton Assuming Pay-as-you-go funding % discount r ate Plan L iabilities as of Januar y 1, 2013 M edical Dental Life Total I. Present Value of Future Benefits A. Actives 103,113, , ,382,256 B. Retirees/Disabled 44,688, ,347 45,285,331 C. Total 147,802, , ,667,587 II. Present Value of Future Normal Cost 40,571, ,324 40,642,711 III. Actuarial Accrued Liability (Projected Unit Credit) A. Actives 62,542, ,381 62,739,545 B. Retirees/Disabled 44,688, ,347 45,285,331 C. Total 107,231, , ,024,876 IV. Plan Assets V. Unfunded Actuarial Accrued Liability ("UAAL") 107,231, , ,024,876 VI. Annual Covered Payroll 36,692,795 36,692,795 36,692,795 36,692,795 VII. UAAL as % of Covered Payroll 292.2% 0.0% 2.2% 294.4% VIII. Net OPEB Beginning of Fiscal Year 19,505, ,381 19,649,919 IX. Number of Eligbible Participants A. Actives B. Retirees/Disabled C. Total 1, ,195 For Fiscal Year Ending June 30, 2013 X. Normal Cost 4,245, ,839 4,254,207 XI. Amortization of UAAL - 30 year increase 3.25% per yr 4,598, ,038 4,632,552 XII. Annual Required Contribution ('ARC') [ X. + XI.] 8,843, ,877 8,886,759 XIII. Interest on Net OPEB Obligation 780, , ,999 XIV. Adjustment to Annual Required Contribution (1,084,623) 0 (8,030) (1,092,653) XV. Amortization of Actuarial (Gains) / Losses (119,510) 0 (885) (120,395) XVI. Annual OPEB Cost [XII. + XIII. + XIV. + XV.] 8,419, ,739 8,459,710 XVII. Expected Employer Contribution 3,038, ,766 3,065,420 XVIII.Contribution to Trust Fund over 30 Years XIX. Total Employer Contribution 3,038, ,766 3,065,420 XX. Percentage of Annual OPEB Cost Contributed 36.1% 0.0% 67.4% 36.2% XXI. Net OPEB Obligation at Beginning of Year (VIII.) 19,505, ,381 19,649,919 XXII. Increase in Net OPEB Obligations (XVI. - XVII.) 5,381, ,973 5,394,290 XXIII.Net OPEB Obligation at End of Year (XXI. + XXII.) 24,886, ,354 25,044,209 Page 2

6 SECTION I PRINCIPAL RESULTS OF THE VALUATION Town of Stoughton Plan L iabilities as of Januar y 1, 2013 Assuming maintain pay-as-you-go funding method Town School Police Employees Fir e Employees and and Ambulance Employees and Golf Cour se Enter prise Public Health Enter prise Sewer Enter prise Water Enter prise Sanitation Enter prise Total I. Present Value of Future Benefits A. Actives 28,551,962 56,836,704 1,463,253 2,510,307 7,539, ,807 1,175,473 1,579,825 2,234, , ,382,256 B. Retirees/Disabled 19,569,979 25,715, ,285,331 C. Total 48,121,941 82,552,056 1,463,253 2,510,307 7,539, ,807 1,175,473 1,579,825 2,234, , ,667,587 II. Present Value of Future Normal Cost 7,975,472 26,932, , ,143 2,108, , , , , ,864 40,642,711 III. Actuarial Accrued Liability (Projected Unit Credit) A. Actives 20,576,490 29,903, ,875 1,600,164 5,430,515 45, , ,814 1,670, ,692 62,739,545 B. Retirees/Disabled 19,569,979 25,715, ,285,331 C. Total 40,146,469 55,619, ,875 1,600,164 5,430,515 45, , ,814 1,670, , ,024,876 IV. Plan Assets V. Unfunded Actuarial Accrued Liability ("UAAL") 40,146,469 55,619, ,875 1,600,164 5,430,515 45, , ,814 1,670, , ,024,876 VI. Annual Covered Payroll 10,412,533 26,280,262 N/A N/A N/A N/A N/A N/A N/A N/A 36,692,795 VII. UAAL as % of Covered Payroll 385.6% 211.6% N/A N/A N/A N/A N/A N/A N/A N/A 294.4% VIII. Net OPEB Obligation 6,740,005 9,327, , ,470 1,166, , , , , ,438 19,649,919 IX. Number of Eligible Participants A. Actives B. Retirees/Disabled C. Total ,250 For Fiscal Year Ending June 30, 2013 X. Normal Cost 1,077,064 2,500,176 56, , ,815 42,191 31,658 68,858 61,572 26,157 4,254,207 XI. Amortization of UAAL - 30 year increase 3.25% per yr 1,433,781 2,620,907 43,836 75, ,004 2,130 44,189 46,944 78,757 30,569 4,632,552 XII. Annual Required Contribution ('ARC') [ X. + XI.] 2,510,845 5,121, , , ,819 44,321 75, , ,329 56,726 8,886,759 XIII. Interest on Net OPEB Obligation 269, ,109 6,241 10,739 46,675 12,122 12,408 14,768 25,558 14, ,999 XIV. Adjustment to Annual Required Contribution (374,784) (518,676) (8,676) (14,929) (64,885) (16,852) (17,250) (20,529) (35,529) (20,543) (1,092,653) XV. Amortization of Actuarial (Gains) / Losses 64,975 90,017 1,505 2,590 8,789 (295,155) 1,517 1,612 2,704 1,051 (120,395) XVI. Annual OPEB Cost [XII. + XIII. + XIV. + XV.] 2,470,637 5,065,533 99, , ,398 (255,564) 72, , ,062 52,012 8,459,710 XVII. Expected Employer Contribution 1,455,406 1,582,165 1,320 1,940 2, ,035 5,520 10,084 2,144 3,065,420 XVIII.Contribution to Trust Fund over 30 Years XIX. Total Employer Contribution 1,455,406 1,582,165 1,320 1,940 2, ,035 5,520 10,084 2,144 3,065,420 XX. Percentage of Annual OPEB Cost Contributed 58.9% 31.2% 1.3% 1.1% 0.5% 0.0% 5.6% 4.9% 7.6% 4.1% 36.2% XXI. Net OPEB Obligation at Beginning of Year (VIII.) 6,740,005 9,327, , ,470 1,166, , , , , ,438 19,649,919 XXII. Increase in Net OPEB Obligations (XVI. - XVII.) 1,015,231 3,483,368 98, , ,592 (255,564) 68, , ,978 49,868 5,394,290 XXIII.Net OPEB Obligation at End of Year (XXI. + XXII.) 7,755,236 12,811, , ,479 1,694,456 47, , , , ,306 25,044,209 Page 3

7 SECTION I PRINCIPAL RESULTS OF THE VALUATION Town of Stoughton Detail of Plan Liabilities by Group and Dependency Status Assuming Pay-as-you-go funding % discount r ate Plan L iabilities as of Januar y 1, 2013 Actives Pr esent Value of Futur e Benefits Actuar ial Accr ued Liability (Projected Unit Cr edit) Nor mal Cost Under Age 65 A. Participants 11,668,528 6,784, ,997 B. Spouses 11,610,121 6,915, ,684 C. Total 23,278,649 13,699, ,681 Age 65 and Over A. Participants 44,436,672 27,194,184 1,820,291 B. Spouses 35,666,935 21,845,373 1,461,235 C. Total 80,103,607 49,039,557 3,281,526 Actives Total A. Participants 56,105,200 33,978,890 2,310,288 B. Spouses 47,277,056 28,760,655 1,943,919 C. Total 103,382,256 62,739,545 4,254,207 /Disabled Under Age 65 A. Participants 2,301,134 2,301,134 0 B. Spouses 1,744,338 1,744,338 0 C. Total 4,045,472 4,045,472 0 Age 65 and Over A. Participants 31,298,275 31,298,275 0 B. Spouses 9,941,584 9,941,584 0 C. Total 41,239,859 41,239,859 0 Retirees/Disabled Total A. Participants 33,599,409 33,599,409 0 B. Spouses 11,685,922 11,685,922 0 C. Total 45,285,331 45,285,331 0 Total Population A. Participants 89,704,609 67,578,299 2,310,288 B. Spouses 58,962,978 40,446,577 1,943,919 C. Total 148,667, ,024,876 4,254,207 Page 4

8 SECTION I PRINCIPAL RESULTS OF THE VALUATION Town of Stoughton Assuming Funding over 30 year s at 7.00% discount r ate and incr easing at 3.25% per year Plan L iabilities as of Januar y 1, 2013 M edical Dental Life Total I. Present Value of Future Benefits A. Actives 49,707, ,145 49,831,491 B. Retirees/Disabled 33,570, ,344 33,995,609 C. Total 83,277, ,489 83,827,100 II. Present Value of Future Normal Cost 15,848, ,388 15,873,448 III. Actuarial Accrued Liability (Projected Unit Credit) A. Actives 33,859, ,757 33,958,043 B. Retirees/Disabled 33,570, ,344 33,995,609 C. Total 67,429, ,101 67,953,652 IV. Plan Assets V. Unfunded Actuarial Accrued Liability ("UAAL") 67,429, ,101 67,953,652 VI. Annual Covered Payroll 36,692,795 36,692,795 36,692,795 36,692,795 VII. UAAL as % of Covered Payroll 183.8% 0.0% 1.4% 185.2% VIII. Net OPEB Obligation 19,505, ,381 19,649,919 IX. Number of Eligible Participants A. Actives B. Retirees/Disabled C. Total 1, ,195 For Fiscal Year Ending June 30, 2013 X. Normal Cost 1,857, ,493 1,861,304 XI. Amortization of UAAL - 30 year increase 3.25% per yr 6,339, ,273 6,388,583 XII. Annual Required Contribution ('ARC') [ X. + XI.] 8,197, ,766 8,249,887 XIII. Interest on Net OPEB Obligation 1,365, ,107 1,375,495 XIV. Adjustment to Annual Required Contribution (1,469,048) 0 (10,874) (1,479,922) XV. Amortization of Actuarial (Gains) / Losses (3,216,659) 0 35,651 (3,181,008) XVI. Annual OPEB Cost [XII. + XIII. + XIV. + XV.] 4,876, ,650 4,964,452 XVII. Expected Employer Contribution 3,038, ,766 3,065,420 XVIII.Contribution over 30 Years increasing at 3.25% per yr 2,244, ,884 2,305,176 XIX. Total Employer Contribution 5,282, ,650 5,370,596 XX. Percentage of Annual OPEB Cost Contributed 108.3% 0.0% 100.0% 108.2% XXI. Net OPEB Obligation at Beginning of Year (VIII.) 19,505, ,381 19,649,919 XXII. Increase in Net OPEB Obligations (XVI. - XVII.) (406,144) 0 0 (406,144) XXIII.Net OPEB Obligation at End of Year (XXI. + XXII.) 19,099, ,381 19,243,775 Page 5

9 SECTION I PRINCIPAL RESULTS OF THE VALUATION Town of Stoughton Plan L iabilities as of Januar y 1, 2013 Assuming Funding over 30 years at 7.00% discount rate and increasing at 3.25% per year Town School Police Fir e Employees and Ambulance Golf Cour se Enter prise Public Health Enter prise Sewer Enter prise Water Enter prise Sanitation Enter prise Total I. Present Value of Future Benefits A. Actives 13,762,388 27,395, ,306 1,209,998 3,634, , , ,495 1,077, ,532 49,831,491 B. Retirees/Disabled 14,691,145 19,304, ,995,609 C. Total 28,453,533 46,700, ,306 1,209,998 3,634, , , ,495 1,077, ,532 83,827,100 II. Present Value of Future Normal Cost 3,114,905 10,518, , , , ,409 92, , ,400 77,278 15,873,448 III. Actuarial Accrued Liability (Projected Unit Credit) A. Actives 11,137,110 16,185, , ,096 2,939,289 24, , , , ,649 33,958,043 B. Retirees/Disabled 14,691,145 19,304, ,995,609 C. Total 25,828,255 35,489, , ,096 2,939,289 24, , , , ,649 67,953,652 IV. Plan Assets V. Unfunded Actuarial Accrued Liability ("UAAL") 25,828,255 35,489, , ,096 2,939,289 24, , , , ,649 67,953,652 VI. Annual Covered Payroll 10,412,533 26,280,262 N/A N/A N/A N/A N/A N/A N/A N/A 36,692,795 VII. UAAL as % of Covered Payroll 248.0% 135.0% N/A N/A N/A N/A N/A N/A N/A N/A 185.2% VIII. Net OPEB Obligation 6,740,005 9,327, , ,470 1,166, , , , , ,438 19,649,919 IX. Number of Eligible Participants A. Actives B. Retirees/Disabled C. Total ,250 For Fiscal Year Ending June 30, 2013 X. Normal Cost 471,238 1,093,879 24,765 46, ,175 18,459 13,851 30,127 26,939 11,444 1,861,304 XI. Amortization of UAAL - 30 year increase 3.25% per yr 1,977,274 3,614,397 60, , ,046 2,937 60,939 64, ,611 42,157 6,388,583 XII. Annual Required Contribution ('ARC') [ X. + XI.] 2,448,512 4,708,276 85, , ,221 21,396 74,790 94, ,550 53,601 8,249,887 XIII. Interest on Net OPEB Obligation 471, ,939 10,922 18,793 81,681 21,213 21,714 25,844 44,726 25,861 1,375,495 XIV. Adjustment to Annual Required Contribution (507,619) (702,510) (11,751) (20,220) (87,882) (22,825) (23,364) (27,805) (48,122) (27,824) (1,479,922) XV. Amortization of Actuarial (Gains) / Losses (915,048) (1,661,337) (23,560) (40,543) (137,592) (295,155) (23,751) (25,231) (42,330) (16,461) (3,181,008) XVI. Annual OPEB Cost [XII. + XIII. + XIV. + XV.] 1,497,647 2,997,368 60, , ,428 (275,371) 49,389 67,674 89,824 35,177 4,964,452 XVII. Expected Employer Contribution 1,455,406 1,582,165 1,320 1,940 2, ,035 5,520 10,084 2,144 3,065,420 XVIII.Contribution over 30 Years increasing at 3.25% per yr 876,166 1,203,919 17,073 29,380 99, ,211 18,284 30,675 11,929 2,305,176 XIX. Total Employer Contribution 2,331,572 2,786,084 18,393 31, , ,246 23,804 40,759 14,073 5,370,596 XX. Percentage of Annual OPEB Cost Contributed 155.7% 93.0% 30.2% 28.9% 30.7% -0.3% 43.0% 35.2% 45.4% 40.0% 108.2% XXI. Net OPEB Obligation at Beginning of Year (VIII.) 6,740,005 9,327, , ,470 1,166, , , , , ,438 19,649,919 XXII. Increase in Net OPEB Obligations (XVI. - XIX.) (833,925) 211,284 42,436 77, ,913 (276,201) 28,143 43,870 49,065 21,104 (406,144) XXIII.Net OPEB Obligation at End of Year (XXI. + XXII.) 5,906,080 9,539, , ,637 1,397,777 26, , , , ,542 19,243,775 Page 6

10 Overview of GASB 43 and 45 GASB 43 requires retiree medical plans to disclose information about asset and liability levels and show historical contribution information. GASB 43 only applies in situations where a separate trust is established to prefund these benefits. GASB 45 requires employers to perform periodic actuarial valuations to determine annual accounting costs, and to keep a running tally of the extent to which these amounts are over or under funded. GASB 43 and 45 apply to those benefits provided after retirement except for pension benefits such as medical insurance, dental and life insurance. The philosophy behind the accounting standard is that these post-employment benefits are part of the compensation earned by employees in return for their services, and the cost of these benefits should be recognized while employees are providing those services, rather than after they have retired. This philosophy has already been applied for years to defined benefit pensions; GASB 43 and 45 extend this practice to all other post-employment benefits. Page 7

11 Overview of GASB 43 and 45 The process of determining the liability for OPEB benefits is based on many assumptions about future events. The key actuarial assumptions are: Turnover and retirement rates: How likely is it that an employee will qualify for postemployment benefits and when will they start? Medical inflation and claims cost assumptions: When an employee starts receiving postemployment benefits many years from now, how much will be paid each year for the benefits and how rapidly will the costs grow? Mortality assumption: How long is a retiree likely to receive benefits? Discount rate assumption: What is the present value of those future benefit payments in terms of today s dollars? Since the liability is being recognized over the employee s whole career with the Town, the present value is divided into three pieces: the part that is attributed to past years (the Accrued Liability or Past Service Liability ), the part that is being earned this year (the Normal Cost ), and the part that will be earned in future years (the Future Service Liability ). Once the Accrued Liability and the Normal Cost have been calculated, the next step is to determine an annual contribution. This consists of two pieces: Normal Cost because the benefits earned each year should be paid for each year Past Service Cost a catch-up payment to fund the Accrued Liability over the next years The final step is to keep track going forward of how much of the contribution is actually paid. There is no requirement to actually fund these benefits, but the cumulative deficiency must be disclosed on the Town s financial statements as the OPEB liability. In addition, the Discount Rate used to calculate the liabilities must reflect the expected investment income of whatever funds are set aside to prefund the benefits; if there is no prefunding then the Discount Rate will be much lower and the liabilities significantly higher than if the benefits are prefunded. Page 8

12 1. Transition to GASB 45: Commentary on Plan Experience and Contribution Amounts The Plan adopted and implemented GASB 45 ( Accounting and Financial Reporting by Employers for Postemployment Benefits other than Pensions ) effective for the fiscal year ending June 30, As part of this implementation, the Employer must recognize the Actuarial Accrued Liability for past service. Under GASB 45, this amount may be amortized over a period not to exceed thirty (30) years. The Unfunded Actuarial Accrued Liability at transition was amortized over a 30 year period with amortization payments increasing at 3.25% per year. This approach yields an amortization charge of $4,632,552. Additionally the Employer must recognize a normal cost which represents the annual accrual of benefits for current active employees toward their ultimate postemployment benefits. The normal cost for the 2013 fiscal year is $4,254,207. The combined amortization charge and normal cost represent the Annual Required Contribution ( ARC ) for the plan for the 2013 fiscal year. As the Employer has chosen to continue their pay-as-you-go funding policy, this valuation must utilize a discount rate which represents earnings on short term investments. For this discount rate, we have used 4.00% per annum. The incremental cost of GASB 45 for the 2013 fiscal year beyond the pay-as-you-go costs is $5,394,290 reduced by contributions to an OPEB Trust of $0 for a net change in the OPEB liability of $5,394, Plan Experience: Plan experience was more favorable than expected. This was due to a reduction in the premiums for Medicare integrated plans and premiums remaining flat in pre-medicare plans vs. an expected 11% increase. This was somewhat offset by the introduction of a more conservative mortality table. The actuarial experience gain is amortized into the annual OPEB costs over a 30-year period. The net impact of plan experience is an increase in the annual OPEB cost as it was discovered that previous census information from the Schools excluded benefit eligible participants who elected to waive coverage leading to an increase in the Normal Cost. Page 9

13 SECTION II SUMMARY OF PLAN PROVISIONS Effective Date July 1, 2008; GASB 45 is adopted. Plan Year July 1 through June 30. Eligibility Credited Service Participant Contributions Benefits Offered Normal Retirement Date Early Retirement An employee hired before April 2, 2012 shall become eligible to retire under this plan upon attainment of age 55 as an active member and completion of 10 years of service or an employee shall be able to retire with 20 years of service regardless of age. Those hired on or after April 2, 2012 shall be eligible to retire upon attainment of age 60 with 10 years of creditable service. Elapsed time from date of hire to termination of service date. 30% of premiums for Medical Insurance, 50% for Life Insurance, retired teachers pay 10%-15% depending on retirement date. Comprehensive Medical, Dental & Life Insurance offered through Blue Cross Blue Shield of Massachusetts, Harvard Pilgrim Health Group and Tufts. Retired teachers receive benefits through the Group Insurance Commission. The normal retirement date is the first day of the month following a participant's 65th birthday. Early retirement is available for any participant who has attained benefit eligibility. Page 10

14 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS A. ACTUARIAL COST METHOD The actuarial cost method used to calculate the costs and liabilities of the plan is the Projected Unit Credit Actuarial Cost Method. Under this method, the normal cost and actuarial accrued liability are both based on an accrual of projected benefits over the period for which benefits are accrued. The normal cost is the actuarial present value of one year's benefit accrual on this basis. The actuarial accrued liability is the actuarial present value of the projected benefit times the ratio of past service to total service at full eligibility for benefits. Actuarial gains and losses are calculated each year and amortized over a 30 year period. All employees who are plan participants on a valuation date are included in the actuarial valuation. B. ASSET VALUATION METHOD The actuarial value of assets is equal to the Market Value of the Plan s assets. Page 11

15 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS C. ACTUARIAL ASSUMPTIONS We used the following assumptions in this year s actuarial valuation: Pre- and Post-Retirement Mortality It is assumed that both pre-retirement and post-retirement mortality are represented by the RP-2000 Mortality Table projected to 2017 for males and females. Discount Rate 4.00% per annum (previously 4.00%) Employee Termination It was assumed that employees would terminate employment in accordance with the sample rates shown in the following table: Ser vice Non Public Safety M ale Non Public Safety Female Public Safety % 15.00% 1.50% % 7.60% 1.50% % 5.40% 1.50% % 3.30% 0.00% % 2.00% 0.00% % 1.00% 0.00% % 0.00% 0.00% Page 12

16 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS C. ACTUARIAL ASSUMPTIONS Retirement Rates for non-teachers It was assumed that the following percentage of eligible employees would retire each year: Age Non Public Safety M ale Non Public Safety Female Public Safety % 0.00% 1.00% % 0.00% 1.00% % 0.00% 1.00% % 0.00% 1.00% % 0.00% 1.00% % 1.50% 2.00% % 1.50% 2.00% % 2.50% 2.00% % 2.50% 5.00% % 2.50% 7.50% % 5.50% 15.00% % 6.50% 10.00% % 6.50% 10.00% % 6.50% 10.00% % 6.50% 15.00% % 5.00% 20.00% % 13.00% 20.00% % 15.00% 25.00% % 12.50% 25.00% % 18.00% 30.00% % 15.00% % % 20.00% % % 20.00% % % 25.00% % % 20.00% % % % % % % % % % % Page 13

17 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS C. ACTUARIAL ASSUMPTIONS Healthcare Trend It was assumed that healthcare costs would increase in accordance with the trend rates in the following table: Year M edical FY % FY % FY % FY % FY % FY % FY % FY % Participation Rate Percent Married It was assumed that 80% of employees eligible to receive retirement benefits would enroll in the retiree medical and dental plans upon retirement (90% for retired teachers). For life insurance plans, it was assumed that 80% of eligible employees would elect coverage upon retirement (90% for retired teachers). It was assumed that 80% of participants who elect retiree healthcare coverage for themselves would also elect coverage for a spouse upon retirement (80% for retired teachers). It was further assumed that husbands are three years older than their wives. For current retirees, the actual census information was used. Page 14

18 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS C. ACTUARIAL ASSUMPTIONS Compensation Increases Additional Comments 3.00% per year. The values in this report reflect a closed group and do not reflect any new entrants after the valuation date. For purposes of this valuation, retiree contributions were assumed to increase with the same trend rate as health care claims. Page 15

19 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS D. DEVELOPMENT OF REPRESENTATIVE MEDICAL PER CAPITA CLAIMS COSTS As part of the Other Post-Employment Benefits Program, there are situations where the cost is borne partly or entirely on the retirees. In most cases, the premium that is used to split the cost is lower than the true cost of providing the medical benefits, for two reasons: The cost sharing program is usually a fixed amount such as a COBRA premium that does not take into account the age of the retiree and his/her dependents. Since medical costs generally increase with age, the cost sharing premium is often lower than the true cost of the medical benefits: The cost sharing premium is usually a blended rate that takes into account the cost of medical benefits for active employees as well as retirees. Medical costs are generally higher for retirees than for active employees of the same age. This means that, again, the cost sharing premium is often lower than the true cost of the medical benefits. Because of these two factors, a retiree who is paying 100% of the cost sharing premium is most likely not paying 100% of the true cost of the medical benefits. This situation is known as an implicit subsidy. GASB 43 and 45 require the plan sponsor to measure the liability for this subsidy; that is, the difference between the true cost of the medical benefits and the cost sharing premiums paid by the retiree. To do this, our valuation consists of several steps: First, we calculate the liability for the true cost of medical benefits expected to be received by retirees and their dependents. This liability is based factors developed by actuaries that reflect how the cost of medical benefits varies by age and gender, as well as the other assumptions discussed on the prior page. Next, we calculate the liability for the future premiums expected to be paid by the retiree for their own and their dependents coverage. This liability is based on the current premium rates without adjustment for age or gender. It also is based on the terms of the retiree medical program different retirees pay different percentages based on their union, date of retirement, age at retirement, and other factors. Page 16

20 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS D. DEVELOPMENT OF REPRESENTATIVE MEDICAL PER CAPITA CLAIMS COSTS I. CLAI M S COSTS DEVELOPM ENT - Based on Active & Retir ee I ncurr ed Claims & Pr emiums Number of Participants Single Two-Person Family Total Tufts EPO Harvard Pilgrim Network Blue M anaged Blue for Senior s 4 4 Tufts Medicare Plus M edex Total Per Contract Premiums (monthly) - FY 2014 Single Two-Person Family Tufts EPO , Harvard Pilgrim , Network Blue , BCBS HMO , Tufts Medicare Plus M anaged Blue for Senior s Tufts Medicare Plus M edex , Gross Expected FY 2014 Incurred Premiums 5,622,662 Adjustment to reflect children's claims (419,873) Total Expected FY 2014 Incurred Premiums (adults only) 5,202,790 II. PRE-65 AND POST-65 PER CAPITA RETIREE ANNUAL CLAIM COSTS Employer Medicare Primary Primary Age 65 12,810 6,585 Average Age 12,025 6,585 GIC Plans for Retired Teachers Per Contract Costs (monthly) - FY 2014 Single Two-Person Family Fallon Direct , Fallon Select , NHP Care , Tufts Spirit , Unicare Basic w/ CIC , Unicare Basic w/o CIC , Unicare OME w/ CIC Unicare OME w/o CIC Tufts Medicare Complement Tufts Medicare Preferred Har var d Senior (GI C) Fallon Senior Page 17

21 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS D. DEVELOPMENT OF REPRESENTATIVE MEDICAL PER CAPITA CLAIMS COSTS III. BREAKDOWN OF CLAIM COSTS 5,202,790 Active and Retired Claims (No Children) - Including Administrative fees & trend 5,990 Average Per-Capita Claim (including Retention & Pooling) ALL ACTIVE EMPLOYEES AND SPOUSES (non-gic) Female Aging Factor Male Aging Factor Aged (F) Average Claims Aged (M) Average Claims Number of Number of Age Related Age Bracket Females Males Claims 24 & Under ,859 3,289 46, to ,859 3, , to ,859 4, , to ,859 5, , to ,859 5, , to ,721 7, , to ,578 8, , to ,423 10, , to ,788 12, , to ,986 13, , & Over ,352 15,316 61,264 Total ,332,274 ALL RETIREES AND SPOUSES - NOT M EDICARE ELIGIBLE (non-gic) Female Aging Factor Male Aging Factor Aged (F) Average Claims Aged (M) Average Claims Number of Number of Age Related Age Bracket Females Males Claims 44 & Under ,859 5, to ,721 7,146 8, to ,578 8,632 35, to ,423 10,500 83, to ,788 12, , to ,986 13,873 26, to ,352 15, to ,532 16,586 16, to ,317 17, to ,155 18,323 18, & Over ,030 19,258 19,258 Total ,431 ALL RETIREES AND SPOUSES - M EDICARE ELIGIBLE (non-gic) Page 18 Female Aging Factor Male Aging Factor Aged (F) Average Claims Aged (M) Average Claims Number of Number of Age Related Age Bracket Females Males Claims 65 to ,585 6, , to ,585 6, , to ,585 6, , to ,585 6, , to ,585 6, , & Over ,585 6,585 59,265 Total ,185,300 Grand Totals ,203,005

22 SECTION III ACTUARIAL COST METHOD, ASSET VALUATION METHOD AND ACTUARIAL ASSUMPTIONS E. DEVELOPMENT OF REPRESENTATIVE DENTAL PER CAPITA CLAIMS COSTS I. CLAI M S COSTS DEVELOPM ENT - with Active & Retir ee I ncur r ed Pr emiums Per Contract Costs (monthly) - FY 2014 Single Two-Person Family Dental Plan N/A N/A FY 2014 Expected Per Person Rate N/A Page 19

23 Page 20 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) The GASB Standards for accounting and financial reporting for postemployment benefits other than pensions requires the following disclosures in the financial statements with regard to the retiree medical and life insurance benefits; 1. A DESCRIPTION OF THE RETIREE MEDICAL INSURANCE PROGRAM: a. Plan Type: Comprehensive Medical offered through Blue Cross Blue Shield of Massachusetts, Harvard Pilgrim Health Group and Tufts. Retired teachers receive benefits through the Group Insurance Commission. b. Administrator: Town of Stoughton c. Eligibility: An employee hired before April 2, 2012 shall become eligible to retire under this plan upon attainment of age 55 as an active member and completion of 10 years of service or an employee shall be able to retire with 20 years of service regardless of age. Those hired on or after April 2, 2012 shall be eligible to retire upon attainment of age 60 with 10 years of creditable service. d. Cost Sharing: 30% of premiums, retired teachers pay 10%-15% depending on retirement date. 2. A DESCRIPTION OF THE DENTAL INSURANCE PROGRAM: a. Plan Type: Comprehensive Dental Insurance offered through the Group Insurance Commission (retired teachers only) b. Administrator: Town of Stoughton c. Eligibility: Same as above d. Cost sharing: 100% Participant paid. 3. A DESCRIPTION OF THE RETIREE LIFE INSURANCE PROGRAM: a. Plan Type: Group Term Life Insurance - $2,000 offered through Boston Mutual. Retired Teachers receive a $5,000 policy via the Group Insurance Commission b. Administrator: Town of Stoughton c. Eligibility: Same as above d. Cost sharing: 50% of premiums, retired teachers pay 10%-15% depending on retirement date.

24 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) 4. RETIREE MEDICAL AND LIFE INSURANCE CONTRIBUTIONS: Group Individual Family Medical 30% of premiums, retired teachers pay 10%-15% depending on retirement date. Life 50% of premiums, retired teachers pay 10%-15% depending on retirement date. 30% of premiums, retired teachers pay 10%-15% depending on retirement date. N/A 5. FUNDING POLICY The contribution requirements of plan members and the Town are established and may be amended through Town ordinances. The required contribution is based on the projected pay-as-you-go financing requirements. For the 2013 fiscal year, total Town premiums plus implicit costs for the retiree medical program are $3,065,420. The Town is also projected to make a contribution to an OPEB Trust of $0 for the 2013 fiscal year for a total contribution of $3,065,420. Page 21

25 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) 6. ANNUAL OPEB COST AND NET OPEB OBLIGATION The Town s annual other postemployment benefit ( OPEB ) cost (expense) is calculated based on the annual required contribution of the employer ( ARC ), an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty (30) years. The following table shows the components of the Town s annual OPEB costs for the fiscal year, the amount actually contributed to the plan and changes in the Town s net OPEB obligation to the plan: Annual Required Contribution $8,886,759 Interest on net OPEB obligation $785,999 Adjustment to annual required contribution ($1,092,653) Amortization of Actuarial (Gains) / Losses ($120,395) Annual OPEB cost (expense) $8,459,710 Contributions made to pay benefits $3,065,420 Contributions made to OPEB Trust $0 Increase in net OPEB obligation $5,394,290 Net OPEB Obligation beginning of year $19,649,919 Net OPEB Obligation end of year $25,044,209 Page 22

26 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) The Town s annual OPEB cost, the percentage of the annual OPEB cost contributed to the plan, and the net OPEB obligation for the 2013 fiscal year and the three preceding years were as follows: Fiscal Year Ended Annual OPEB Cost Expected Employer Payments Per centage of OPEB Cost Contributed I ncr ease in OPEB Obligation Net OPEB Obligation 06/30/2015 (est.) $9,948,753 $3,363, % $6,585,322 $37,639,739 06/30/2014 (est.) $9,225,744 $3,215, % $6,010,206 $31,054,417 06/30/2013 $8,459,712 $3,065, % $5,394,292 $25,044,211 06/30/2012 $8,695,467 $3,674, % $5,021,392 $19,649,919 06/30/2011 $8,249,218 $3,513, % $4,735,518 $14,628,527 06/30/2010 $9,138,293 $4,132, % $5,005,985 $9,893,009 Schedule of Funding Progress: Actuar ial Valuation Actuar ial Value of Unfunded Actuar ial Accr ued Actuar ial Accr ued Funded UAAL as a % of Cover ed Date Assets Liability Liability Ratio Cover ed Payr oll Payr oll 01/01/2015 (est.) $0 $119,568,949 $119,568, % $38,927, % 01/01/2014 (est.) $0 $113,563,317 $113,563, % $37,793, % 01/01/2013 $0 $108,024,876 $108,024, % $36,692, % 01/01/2012 $0 $122,683,013 $122,683, % N/A N/A 01/01/2011 $0 $122,837,052 $122,837, % N/A N/A 01/01/2010 $0 $117,348,576 $117,348, % N/A N/A Page 23

27 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) Fiscal Year Ending June 30, 2013 Ambulance Golf Cour se Enter prise Public Health Enter prise Sewer Enter prise Water Enter prise Sanitation Enter prise Town Employees and School Employees and Police Employees and Fir e Employees and Total OPEB obligation at beginning of year 6,740,005 9,327, , ,470 1,166, , , , , ,438 19,649,919 Annual Required Contribution 2,510,845 5,121, , , ,819 44,321 75, , ,329 56,726 8,886,759 Interest on Net OPEB Obligation 269, ,109 6,241 10,739 46,675 12,122 12,408 14,768 25,558 14, ,999 Adjustment to the ARC (374,784) (518,676) (8,676) (14,929) (64,885) (16,852) (17,250) (20,529) (35,529) (20,543) (1,092,653) Amortization of Actuarial (Gains)/Losses 64,975 90,017 1,505 2,590 8,789 (295,155) 1,517 1,612 2,704 1,051 (120,395) Annual OPEB Cost 2,470,637 5,065,533 99, , ,398 (255,564) 72, , ,062 52,012 8,459,710 Total Expected Employer Payments 1,455,406 1,582,165 1,320 1,940 2,806-4,035 5,520 10,084 2,144 3,065,420 Increase in OPEB Obligation 1,015,231 3,483,368 98, , ,592 (255,564) 68, , ,978 49,868 5,394,290 OPEB obligation at end of year 7,755,236 12,811, , ,479 1,694,456 47, , , , ,306 25,044,209 APBO at beginning of year 40,146,469 55,619, ,875 1,600,164 5,430,515 45, , ,814 1,670, , ,024,876 Ambulance Fiscal Year Ending June 30, 2014 Golf Cour se Enter prise Public Health Enter prise Sewer Enter prise Water Enter prise Sanitation Enter prise Town Employees and School Employees and Police Employees and Fir e Employees and Total OPEB obligation at beginning of year 7,755,236 12,811, , ,479 1,694,456 47, , , , ,306 25,044,209 Annual Required Contribution 2,666,318 5,438, , , ,244 47,065 80, , ,018 60,238 9,437,024 Interest on Net OPEB Obligation 343, ,533 7,954 13,687 59,488 15,450 15,814 18,822 32,574 18,835 1,001,768 Adjustment to the ARC (477,670) (661,061) (11,058) (19,027) (82,697) (21,478) (21,985) (26,165) (45,282) (26,182) (1,392,605) Amortization of Actuarial (Gains)/Losses (119,122) 271,570 4,966 8,794 28,391 (38,525) 4,717 6,134 8,801 3, ,557 Annual OPEB Cost 2,413,137 5,524, , , ,426 2,512 79, , ,111 56,722 9,225,744 Total Expected Employer Payments 1,526,679 1,659,646 1,385 2,035 2,943-4,233 5,790 10,578 2,249 3,215,538 Increase in OPEB Obligation 886,458 3,864, , , ,483 2,512 74, , ,533 54,473 6,010,206 OPEB obligation at end of year 8,641,694 16,675, , ,688 2,269,939 50, , , , ,779 31,054,415 APBO at beginning of year 42,204,781 58,470, ,550 1,682,204 5,708,938 47, ,461 1,046,869 1,756, , ,563,317 Page 24

28 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) 7. FUNDED STATUS AND FUNDING PROGRESS As of January 1, 2013, the most recent valuation date, the plan was 0.00% funded. The actuarial liability for benefits was $108,024,876, and the actuarial value of assets was $ 0, resulting in an unfunded actuarial accrued liability (UAAL) of $108,024,876. The covered payroll (annual payroll of active employees covered by the plan) was $ 36,692,795 and the ratio of the UAAL to the covered payroll was 294.4%. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contribution of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented in the required supplementary information following the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. 8. EFFECT OF 1% CHANGE IN HEALTHCARE TREND RATES In the event that healthcare trend rates were 1% higher than forecast and employee contributions were to increase at the forecast rates, the Actuarial Accrued Liability would increase to $136,870,108 or by 26.7% and the corresponding Normal Cost would increase to $6,298,923 or by 48.1%. If such healthcare trend rates were 1% less than forecast and employee contributions were to increase at the forecast rate, the Actuarial Accrued Liability would decrease to $85,717,125 or by 20.7% and the corresponding Normal Cost would decrease to $2,807,680 or by 34.0%. Page 25

29 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) 9. ACTUARIAL METHODS AND ASSUMPTIONS Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. Actuarial Cost Method: Projected Unit Credit Investment Rate of Return: 4.00% per annum (previously 4.00%) Healthcare Trend Rates Year M edical FY % FY % FY % FY % FY % FY % FY % FY % General Inflation Assumption: 2.50% per annum Annual Compensation Increases: 3.00% per annum Actuarial Value of Assets: Market Value Amortization of UAAL: Amortized increasing at 3.25% per year over 30 years at transition Remaining Amortization Period: 26 years at January 1, 2013 Page 26

30 10. Remaining Amortization Bases EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) The initial Actuarial Accrued Liability as of the date GASB 45 was adopted is amortized as a component of the Annual Required Contribution ( ARC ). The Unfunded Actuarial Accrued Liability at transition was amortized over a 30 year period with amortization payments increasing at 3.25% per year. For years subsequent to the initial adoption of GASB 45, cumulative gains/losses are amortized on a level dollar basis over a 30 year period. Gains and losses arise from experience and contribution deficiencies and excess contributions in relation to each year s ARC under GASB 45. Expected Unfunded Actuarial Liability 1. Actuarial Accrued Liability at prior valuation date 122,683, Actuarial Value of Assets at prior valuation date 0 3. Unfunded Actuarial Accrued Liability at prior valuation date [ ] 122,683, Normal Cost for prior periods 7,988, Employer Contribitions for prior periods (7,187,775) 6. Interest to current valuation date 10,356, Expected Actuarial Accrued Liability [ ] 133,839,743 Actual Unfunded Actuarial Liability Changes in Unfunded Actuarial Liability Since Prior Valuation 8. Actuarial Accrued Liability at current valuation date 108,024, Actuarial Value of Assets at current valuation date Unfunded Actuarial Accrued Liability at current valuation date [ ] 108,024,876 Net Actuarial (Gain) / Loss from Plan Experience [ ] (25,814,867) 11. Unfunded Actuarial Accrued Liability at current valuation date [10.] 108,024, Remaining Initial Unfunded to be amortized 110,190, Actuarial (Gain) / Loss to be amortized: [ ] (2,165,158) Page 27

31 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) Amortization of Initial Unfunded and Plan Experience under GASB 45 Initial Amount Initial Amor tization Per iod Remaining Balance at Valuation Date Remaining Amor tization Per iod Annual Amor tization Payment Date Established Description July 1, 2008 GASB 45 Liability 117,348, ,190, ,632,552 July 1, 2012 Cumulative (Gain) / Loss (2,165,158) 30 (2,165,149) 30 (120,395) July 1, 2012 Adjustment to ARC (19,649,919) 30 (19,649,919) 30 (1,092,651) Total 88,374,966 3,419, Recognition of OPEB trust assets The State of Massachusetts has recently passed legislation allowing municipal entities to establish a trust for Other Than Postemployment Benefits ( OPEB ) under M.G.L. Chapter 32B, Section 20 for purposes of accumulating assets to prefund the liabilities under GASB 45. To the best of our knowledge, the Town of Stoughton has accepted M.G.L. Chapter 32B, Section 20 which authorizes it to establish an irrevocable Trust for the purposes of prefunding liabilities under GASB 45. However, at this point they have not funded the Trust. Page 28

32 EXHIBIT A Financial Statement Disclosure (As of January 1, 2013) 12. Impact of Patient Protection and Affordable Care Act ( PPACA ) Excise Tax For purposes of this valuation, we have not attempted to value the impact of the PPACA excise tax for the cost of plan benefits beyond the statutory thresholds beginning in While the threshold levels are known, our position is to wait for more guidance on how this excise tax will work and how employers and bargaining units will respond so as to avoid overstating the impact of such a tax. Beyond that, it is not clear if this tax should be considered a benefit for GASB 45 purposes or should be considered an operating expense of the entity. 13. Impact of Section 9A1/2 of M.G.L. Chapter 32B For employees who retire on or after January 1, 2011 whenever a retired employee or beneficiary receives a healthcare premium contribution from a governmental unit in a case where a portion of the retiree's creditable service is attributable to service in 1 or more other governmental units, the first governmental unit shall be reimbursed in full, in accordance with this paragraph, by the other governmental units for the portion of the premium contributions that corresponds to the percentage of the retiree's creditable service that is attributable to each governmental unit. The other governmental units shall be charged based on their own contribution rate or the contribution rate of the first employer, whichever is lower. For purposes of the valuation we have not attempted to value the impact of prior governmental service at other entities in the State of Massachusetts for current employees of the Town of Stoughton nor have we attempted to value the impact of prior Town of Stoughton employees currently working at other governmental entities in the State of Massachusetts. Page 29