The PSBA Insurance Trust has partnered with Willis of Pennsylvania to help school districts with recent retiree legislation.

The issuance of Government Accounting Standards Board Statement No. 45 (GASB No. 45) on Other Post-Employment Benefits (“OPEB”) will cause financial statements for governmental employers, including school districts, to change from cash to an accrual basis for retiree medical programs. This statement is effective for fiscal years beginning:

• After December 15, 2006, for school districts with total annual revenues of $100 million or more;
• After December 15, 2007, for school districts with total annual revenues of $10 million or more but less than $100 million; and
• After December 15, 2008, for school districts with total annual revenues of less than $10 million.

Earlier implementation is encouraged by the GASB and there are other good reasons for a school district to have a valuation performed earlier than required, including:

• To quantify the liability to determine and understand the magnitude and impact of the liability,
• To more thoroughly and thoughtfully address retiree medical benefits,
• To use this information in a proactive manner that will help plan for long-term financial and business planning and goals,
• To assess, evaluate and strategize the current and future retiree benefits,
• To determine what, if any changes should be made to reduce the liability and the impact of such changes, and
• To use the findings to strategize for contract negotiations.

The PSBA Insurance Trust’s partnership with Willis of Pennsylvania is already helping many school districts with adopting this new accounting standard. To receive more information on GASB 45 and how we can help your district, contact Tony Wright, Senior Sales Representative (770-2492, ext. 333).