Comprehensive Annual Financial Report - Harford County Public ...

HARFORD COUNTY PUBLIC SCHOOLS
NOTES TO FINANCIAL STATEMENTS
June 30, 2012
Article of the Annotated Code of Maryland. The Agency issues a publicly available financial
report that includes basic financial statements and required supplementary information for the
State System. The report may be obtained by writing to the State Retirement and Pension
System of Maryland, 120 East Baltimore Street, Baltimore, MD 21202, or by calling 410-625-
5555.
The State Personnel and Pensions Article requires active members to contribute to the State
System at the rate of 5% or 7% of their covered salary depending upon the retirement option
selected. Harford County Public Schools is required to contribute at an actuarially determined
rate. The State’s contributions on behalf of the Board for the years ended June 30, 2012, 2011,
and 2010 were $33,360,568, $34,323,976 and $31,578,248, respectively, which were equal to the
required contributions for each year. The Board’s contribution for the years ended June 30,
2012, 2011 and 2010 were $2,946,759, $4,630,306 and $3,469,631 respectively, which were
equal to the required contributions for each year.
NOTE 6 - POSTEMPLOYMENT BENEFITS OTHER THAN PENSION BENEFITS
The Board provides medical, dental and life insurance benefits to eligible employees upon
retirement. The employer’s contributions are financed on a pay-as-you-go basis, and the future
payment of these benefits is contingent upon the annual approval of the operating budget.
Details of the postemployment benefits provided are as follows:
Medical Benefits - Retirees are eligible for continued membership in one of the school system’s
group medical plans provided that they have at least 10 years of service with the Board and are
under 65 years of age. The Board pays either 85% or 90% of these medical insurance premiums,
based on the plan chosen by the retiree. The Board pays 90% of the insurance premiums for
Medicare supplemental insurance for retirees age 65 and older. The medical benefits paid by the
Board for the year ended June 30, 2012 was $17,957,063. As of June 30, 2012, 2,019 of
approximately 2,200 eligible retirees were receiving benefits.
Dental Benefits - The Board pays 90% of dental insurance premiums for retirees with at least 10
years service. The dental benefits paid by the Board for the year ended June 30, 2012 was
$911,899. As of June 30, 2012, 2,003 of approximately 2,200 eligible retirees were receiving
benefits.
Life Insurance Benefits - The Board pays 90% of the life insurance premiums for retirees with at
least 10 years of service. The amount of insurance coverage is reduced to $20,000 upon
retirement and $10,000 five years after retirement. The life insurance benefits paid by the Board
for the year ended June 30, 2012 was $239,978. As of June 30, 2012, 1,902 of approximately
2,200 eligible retirees were receiving benefits.
The Board participates in the Maryland Association of Boards of Education (MABE) pooled
OPEB investment trust. It is a member owned trust that provides the Board and the other nine
member boards a structure to pool assets to reduce investment costs and share administrative
expenses.
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