City of Coral Springs, Florida

Notes to Financial Statements

Note 16. Other Post-Employment Benefits (Continued)

The deferred outflows of resources related to the OPEB plan totaling $214,200 resulting from City contributions to the Plan subsequent to the measurement date, will be recognized as a reduction of the OPEB liability for the fiscal year ending September 30, 2023 Other amounts reported as deferred outflows of resources and as deferred inflows of resources related to the Plan will be recognized in expense as follows:

Plan Reporting As Required By Gasb 74

The following disclosures for the City’s OPEB Trust Fund are required by GASB Statement No 74, Financial Reporting for Post-Employment Benefit Plans Other than Pension Plans. However, the balance for the Net OPEB Liability is not required to be reported on the City’s financial statements until September 30, 2023.

Employees Covered by benefit terms. As of October 1, 2021, employee membership data related to the Plan is as follows:

Rate of return. For the year ended September 30, 2022, the annual money-weighted rate of return (loss) on investments, net of investment expense, was -13.11% The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested.

Net OPEB Liability of the City

The components of the net OPEB liability of the City as of September 30, 2022 (measurement date), were as follows:

Note 16. Other Post-Employment Benefits (Continued)

Actuarial assumptions

The total OPEB liability was determined by an actuarial valuation as of October 1, 2021 with updated asset information as of September 30, 2022, using the following assumptions, applied to all prior period included in the measurement:

For police and fire employees, mortality rates were based on sex distinct PUB 2010 safety employees headcount weighted mortality table with generational mortality improvement scale MP-2021 For all other employees, mortality rates were based on sex distinct PUB 2010 general employees headcount weighted mortality table with generational mortality improvement scale MP-2021

For the measurement date of September 30, 2022, the following assumptions were changed:

• The mortality improvement scale was updated to MP-2021.

• The per capita claims costs and how these costs escalate in the future were updated for medical coverage. Dental costs remained flat and thus were not updated.

• The discount rate for accounting purposes was updated to reflect the weighted discount rate of the expected return on plan assets and the yield on a highly rated 20-year municipal bond as of September 30, 2022.

The long-term expected rate of return on OPEB plan investments was determined using a building-block method in which best–estimate ranges of expected future real rates of return (expected returns, net of investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation.

Note 16. Other Post-Employment Benefits (Continued)

The target allocation and best estimates of real rates of return for each major asset class as of September 30, 2022 (measurement date), are summarized in the following table:

Discount rate The discount rate used to measure the total OPEB liability was 5.10%. The projection of cash flows used to determine the discount rate assumes that City contributions will be made at rates equal to the actuarially determined contribution rates The long-term expected rate of return on OPEB plan investments are based on a blend of the expected long-term rate of return on assets of 5.50% for benefit payments during the first 17 years after the valuation date and a yield on 20-year grade AA/Aa or higher municipal bonds of 4.77% per year for benefit payments beyond the first 14 years after the valuation date.

Sensitivity of the Net OPEB Liability to Changes in the Discount Rate The following table illustrates the impact of interest rate sensitivity on the net OPEB liability of the City as of September 30, 2022 (measurement date):

Sensitivity of the Net OPEB Liability to Changes in the healthcare cost trend rates The following table illustrates the impact of healthcare cost trend rate sensitivity on the net OPEB liability of the City as of September 30, 2022 (measurement date):

Note 17. Pronouncements Issued But Not Yet Adopted

GASB Statement No. 91, Conduit Debt Obligations, was issued May 2019. This Statement provides a single method of reporting conduit debt obligations by issuers and eliminates diversity in practice associated with: (1) commitments extended by issuers, (2) arrangements associated with conduit debt obligations, and (3) related note disclosures. The provisions of this Statement will be effective for the City beginning with its year ending September 30, 2023.

GASB Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements, was issued March 2020. This statement improves financial reporting by addressing issues related to public-private and public-public partnership arrangements (PPPs). This Statement also provides guidance for accounting and financial reporting for availability payment arrangements (APAs). The requirements of this Statement are effective for the City beginning with its year ending September 30, 2023.

GASB Statement No 96, Subscription-Based Information Technology Arrangements, was issued May 2020 This Statement provides guidance on the accounting and financial reporting for subscription-based information technology arrangements (SBITAs) for government end users (governments). The requirements of this Statement are effective for the City beginning with its year ending September 30, 2023.

GASB Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans an amendment of GASB Statements No. 14 and No. 84, and a supersession of GASB Statement No. 32, was issued June 2020. The primary objectives of this Statement are to: (1) increase consistency and comparability related to the reporting of fiduciary component units in circumstances in which a potential component unit does not have a governing board and the primary government performs the duties that a governing board typically would perform; (2) mitigate costs associated with the reporting of certain defined contribution pension plans, defined contribution other postemployment benefit (OPEB) plans, and employee benefit plans other than pension plans or OPEB plans (other employee benefit plans) as fiduciary component units in fiduciary fund financial statements; and (3) enhance the relevance, consistency, and comparability of the accounting and financial reporting for Internal Revenue Code (IRC) Section 457 deferred compensation plans (Section 457 plans) that meet the definition of a pension plan and for benefits provided through those plans The requirements of this Statement are effective for the City beginning with its year ending September 30, 2022. Except for the requirement of this Statement that: (1) exempt primary governments that perform the duties that a governing board typically performs from treating the absence of a governing board the same as the appointment of a voting majority of a governing board in determining whether they are financially accountable for defined contribution pension plans, defined contribution OPEB plans, or other employee benefit plans, and (2) limit the applicability of the financial burden criterion in paragraph 7 of Statement 84 to defined benefit pension plans and defined benefit OPEB plans that are administered through trust that meet the criteria in paragraph 30 of Statement 67 or paragraph 30 of Statement 74, respectively, are effective immediately.

GASB Statement No. 99, Omnibus 2022 will enhance comparability in the application of accounting and financial reporting requirements and will improve the consistency of authoritative literature. Consistent authoritative literature enables governments and other stakeholders to more easily locate and apply the correct accounting and financial reporting provisions, which improves the consistency with which such provisions are applied. The comparability of financial statements also will improve as a result of this Statement. Better consistency and comparability improve the usefulness of information for users of state and local government financial statements. The statement will be effective for the City at various times through the year ending September 30, 2024

Note 17. Pronouncements Issued But Not Yet Adopted (Continued)

GASB Statement No. 100, Accounting Changes and Error Corrections will improve the clarity of the accounting and financial reporting requirements for accounting changes and error corrections, which will result in greater consistency in application in practice. In turn, more understandable, reliable, relevant, consistent, and comparable information will be provided to financial statement users for making decisions or assessing accountability. In addition, the display and note disclosure requirements will result in more consistent, decision useful, understandable and comprehensive information for users about accounting changes and error corrections. The statement will be effective for the City with its year ending September 30, 2024.

GASB Statement No. 101, Compensated Absences will through its unified recognition and remeasurement model, result in a liability for compensated absences that more appropriately reflects when a government incurs an obligation. In addition, the model can be applied consistently to any type of compensated absence and will eliminate potential comparability issues between governments that offer different types of leave. The model also will result in a more robust estimate of the amount of compensated absences that a government will pay or settle, which will enhance the relevance and reliability of information about the liability for compensated absences. The statement will be effective for the City with its year ending September 30, 2024

The City’s management has not yet determined the effect these statements will have on the City’s financial statements.

City of Coral Springs, Florida

Notes to Financial Statements

Note 18. Restatement of Prior Year Balances

The City implemented GASB Statement 87, Leases during the fiscal year 2022. The new standard requires the reporting of certain lease assets and liabilities, which were not previously reported. The result of these changes impacted the beginning lease receivable, right-of-use asset, lease liability and deferred inflows of resources as shown below:

City of Coral Springs, Florida

Required Supplementary Information General Fund

Schedule of Revenue, Expenditures, Other Financing Sources (Uses) and Changes in Fund Balances –Budget and Actual (Budgetary Basis) – Unaudited

Fiscal Year Ended September 30, 2022

See Notes to Required Supplementary Information.

City of Coral Springs, Florida

Required Supplementary Information

Fire Special Revenue Fund

Schedule of Revenue, Expenditures, Other Financing Sources (Uses) and Changes in Fund Balances –Budget and Actual (Budgetary Basis) – Unaudited

Fiscal Year Ended September 30, 2022

See Notes to Required Supplementary Information.

City of Coral Springs, Florida Required

* There are currently no active employees in the plan. This Schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10-year trend is compiled, information for those years for which information is available will be presented.

City of Coral Springs, Florida

Required Supplementary Information

Police Officers’ Retirement Plan

Schedule of Changes in the Net Pension Liability and Related Ratios

Last Eight Fiscal Years (Unaudited)

* The Total Pension Liability – beginning and Plan Fiduciary Net Position – beginning for 2022 includes DROP amounts that are now being included due to the implementaion of GASB 84. That amount is $18,043,457.

This Schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10-year trend is compiled, information for those years for which information is available will be presented.

City of Coral Springs, Florida

Required Supplementary Information

Firefighters’ Retirement Plan

Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios

Last Eight Fiscal Years (Unaudited)

This Schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10-year trend is compiled, information for those years for which information is available will be presented.

City of Coral Springs, Florida

Required Supplementary Information

* Beginning in fiscal year 2018, there were no active employees in the General Employees’ Retirement Plan. As a result, covered payroll is zero. Notes

The following actuarial methods and assumptions were used in 2022, to determine contribution rates reported in this schedule:

Headcount Weighted Mortality Tables with mortality improvements projected to all future years after 2010 using Scale MP-2018. For females, the base table used is the Below Median Healthy Retiree Female table. For males, the base table used is the Below Median Healthy Retiree Male Table, set back 1 year.

City of Coral Springs, Florida

Required

* The employee contributions for 2022, excludes DROP contribuions of $3,293,591 that are not available to fund the total pension liabiliity.

The following actuarial methods and assumptions were used in 2022, to determine contribution rates reported in this schedule:

City of Coral Springs, Florida

Required

* The employee contributions for 2022, excludes DROP contribuions of $2,450,806 that are not available to fund the total pension liabiliity

The following actuarial methods and assumptions were used in 2022, to determine contribution rates reported in this schedule:

As mandated by Chapter 2015-157, Laws of Florida, the assumed rates of mortality are the rates used in Milliman's July 1, 2019 FRS valuation for special risk employees, updated with appropriate adjustments made based on plan demographics.

Notes to Schedule:

This Schedule is presented to illustrate the requirements of GASB 67. The requirement is to show information for 10 years. However, until a full 10-year trend is compiled, information for those years for which information is available will be presented.

City of Coral Springs, Florida

Required Supplementary Information

Other Post-Employment Benefits – Employer Reporting Schedule of Changes in the Net OPEB Liability and Related Ratios

Notes to Schedule:

* Changes in assumptions. In 2022, the following assumptions were changed: the discount rate increased from 3.08% to 3.21%, and the per capita claims costs for medical coverage were updated.

* This Schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10-year trend is compiled, information for those years for which information is available will be presented.

City of Coral Springs, Florida

* Contributions made include payments made to the OPEB Trust Fund and claims cost in excess of retiree contributions. This Schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10-year trend is compiled, information for those years for which information is available will be presented.

City of Coral Springs, Florida

Required Supplementary Information

Other Post-Employment Benefits – Plan Reporting Schedule of Changes in the Net OPEB Liability and Related Ratios

This Schedule is presented to illustrate the requirement to show information for 10 years. However, until a full 10-year trend is compiled, information for those years for which information is available will be presented.

Notes to Schedule:

This Schedule is presented to illustrate the requirement of GASB 74. The requirement is to show information for 10 years. However, until a full 10-year trend is compiled, information for those years for which information is available will be presented.