Fiscal 2013 valuation

Town of Winthrop · from the Town's website · 33 pages · 544 KB
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TOWN OF WINTHROP 
OTHER POSTEMPLOYMENT BENEFITS PROGRAM 
Associate, Society of Actuaries 
ACTUARIAL VALUATION 
Prepared by: 
Christopher E. Bean, ASA, MAAA 
July 1, 2013 
Linda L. Bournival, FSA, EA, MAAA 
Member, American Academy of Actuaries 
DBR Group, Inc. 
KMS Actuaries, LLC 
Enrolled Actuary 
Member, American Academy of Actuaries 
and 
Fellow, Society of Actuaries

Mr. Timothy J. Gordon 
Chief Financial Officer 
Town of Winthrop 
1 Metcalf Square 
Winthrop, MA 02152 
Dear Tim: 
Our best estimate health care cost trend assumptions are based on recent experience and anticipated
future cost increases under the Town of Winthrop medical plans. Section 5 illustrates the sensitivity of
actuarial accrued liability and normal cost to a one percentage increase and decrease in the health care
cost trend assumption for each future year. 
Our actuarial valuation is based on a discount rate of 4.0% compounded annually. To illustrate the impact
on cost of fully prefunding the Town's benefit liabilities, our report also includes valuation results based on
an alternative 8.0% discount rate. 
We also provide 30-year forecasts of the OPEB liability under a pay-as-you-go arrangement and a fully-funded
arrangement as well as a 10-year forecast of the Annual OPEB Cost and the Net OPEB Obligation in Section
4. 
April 8, 2014 
Enclosed is our report summarizing the results of an actuarial valuation of the Town of Winthrop's Other
Postemployment Benefits (OPEB) as of July 1, 2013. Our valuation was performed in accordance with the
provisions contained in the GASB Statement No. 45, Accounting and Financial Reporting by Employers for
Postemployment Benefits Other Than Pensions (GASB 45). 
A summary of the valuation results is shown in Section 1. The principal results of our valuation are
summarized in Section 2. The Plan Provisions and Actuarial Assumptions and Methods are shown in
Sections 6 and 7, respectively. Section 8 summarizes the demographic profile of active employees and
retirees. 
The required disclosures under GASB 45 are presented in Section 3.

Page 2 
508-628-9022 
Our valuation follows generally accepted actuarial methods and we perform such tests as we consider
necessary to assure the accuracy of the results. The amounts presented in this report have been
appropriately determined according to the actuarial assumptions and methods stated herein. 
We are members of the American Academy of Actuaries and meet the Qualification Standards of the
American Academy of Actuaries to render the actuarial opinion contained herein. 
We appreciate this opportunity to be of service to the Town of Winthrop. We are available to answer any
questions with respect to our valuation. 
Mr. Timothy J. Gordon 
April 8, 2014 
Our calculations were based on participant census data and other information provided by the Town of
Winthrop and the benefit provisions of the medical plans as described in the benefit summaries. Our
valuation is also based on medical plan rates provided on the GIC website. 
Respectfully submitted, 
603-792-9494 
Christopher E. Bean, ASA, MAAA 
Member, American Academy of Actuaries 
Linda L. Bournival, FSA, EA, MAAA 
Member, American Academy of Actuaries

ACTUARIAL CERTIFICATION 1 
SECTION 1 - SUMMARY 2 
SECTION 2 - PRINCIPAL VALUATION RESULTS 6 
TABLE 2.1 - OPEB TRUST ASSETS 
TABLE 2.2 - ACTUARIAL ACCRUED LIABILITY 
TABLE 2.3 - NORMAL COST 
TABLE 2.4 - ANNUAL REQUIRED CONTRIBUTION AND ANNUAL OPEB COST 
SECTION 3 - GASB 45 ACCOUNTING DISCLOSURE 10 
SECTION 4 - FORECASTS 11 
TABLE 4.1 - ANNUAL REQUIRED CONTRIBUTIONS 
TABLE 4.2 - FUNDING THE ANNUAL REQUIRED CONTRIBUTION 
TABLE 4.3 - ANNUAL OPEB COST AND NET OPEB OBLIGATION 
SECTION 5 - SENSITIVITY TO HEALTH CARE COST TREND RATE 15 
TABLE 5.1 - ACTUARIAL ACCRUED LIABILITY 
TABLE 5.2 - NORMAL COST 
SECTION 6 - PLAN PROVISIONS 17 
SECTION 7 - ACTUARIAL ASSUMPTIONS AND METHODS 19 
SECTION 8 - PLAN MEMBER INFORMATION 24 
TABLE 8.1 - ACTIVE EMPLOYEES BY AGE and YEARS OF SERVICE 
TABLE 8.2 - RETIRED PLAN PARTICIPANTS and SURVIVORS 
SECTION 9 - GOVERNMENTAL ACCOUNTING STANDARDS BOARD 26 
STATEMENT NO. 45 GLOSSARY OF TERMS 
SECTION 10 - RESULTS BY SUBGROUP 28 
TABLE OF CONTENTS 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

Respectfully submitted, 
603-792-9494 
Christopher E. Bean, ASA, MAAA 
Member, American Academy of Actuaries 
508-628-9022 
Linda L. Bournival, FSA, EA, MAAA 
Member, American Academy of Actuaries 
This report is intended for the sole use of the Town of Winthrop and is intended to provide information to
comply with the stated purpose of the report. It may not be appropriate for other purposes. 
The undersigned credentialed actuaries are Members of the American Academy of Actuaries and together
meet the Qualification Standards of the American Academy of Actuaries necessary to render the actuarial
opinion contained herein. They are available to answer any questions with regard to this report. 
ACTUARIAL CERTIFICATION 
This report presents the results of the Actuarial Valuation for the Town of Winthrop Postemployment Benefits
Other Than Pensions as of July 1, 2013. The report presents the accounting and financial reporting
information in accordance with Statement Number 45 of the Governmental Accounting Standards Board
(GASB 45). 
This report was completed in accordance with generally accepted actuarial standards and procedures, and
conforms to the Code of Professional Conduct of the American Academy of Actuaries. The actuarial
assumptions other than those explicitly applicable to the postemployment benefit plans are consistent with
those used by the Winthrop Contributory Retirement System and Massachusetts Teachers Retirement
System's actuaries for the Retirement System pension valuations. 
This valuation was performed using employee data and financial information provided to us by the Town.
The data required enhancements before our analysis could be performed and we obtained additional or
corrected data from the Town. Judgmental adjustments were applied to the enhanced data that allowed us
to perform the analysis and are disclosed in Section 7 - Actuarial Assumptions and Methods. We did not
audit the data used in the valuation. 
Page 1 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

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SECTION 1 - SUMMARY 
ACTUARIAL VALUATION 
As of July 1, 2013, there are 456 active employees who may be eligible for benefits in the future and 391
retired employees, covered spouses and survivors who are currently receiving benefits. Coverage is for
individuals and families or individuals and spouses depending on the coverage selected. 
The Governmental Accounting Standards Board (GASB) is responsible for establishing accounting standards
for governmental entities. Calculations developed in accordance with GASB standards are required when
providing financial statements. 
GASB believes that postemployment benefits are a form of deferred compensation whose cost should be
recognized while the employee actually renders services rather than when the actual benefits are paid, many
years later. Ideally under the GASB standard the entire postemployment liability is recognized by the time an
active participant begins to receive postemployment benefits. GASB 45’s focus is on postemployment
benefits other than pensions, such as medical, dental and life insurance benefits. Unlike pensions where
sponsors are pre-funding for benefits due in the future, the impact of GASB 45 will be to significantly
increase cash pay-as-you-go expense. 
The effective date for GASB 45 is a function of the Town's total annual revenues in the first fiscal year ending
after June 15, 1999. We understand that this is your fiscal year that ended June 30, 1999, and that your
related revenues were greater than $10 million and less than $100 million. As a result, the Town was
required to comply with GASB 45 for the fiscal year ending June 30, 2009. 
Group 1 employees hired before April 2, 2012: retire after attaining age 55 with 10 or more years
of service or any age with 20 or more years of service 
Group 1 employees hired after April 1, 2012: retire after attaining age 60 with 10 or more years of
service 
Group 4 employees hired before April 2, 2012: retire after attaining age 55 or any age with 20 or
more years of service 
Group 4 employees hired after April 1, 2012: retire after attaining age 55 
BACKGROUND 
GASB 45 
The Town of Winthrop provides postemployment medical benefits to Town retirees and their covered
dependents. The Town provides benefits as follows: 
Medical coverage continues to the spouse after the death of the retiree provided the spouse makes the
required contributions. 
Page 2 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 1 - SUMMARY 
Valuation Date July 1, 2013 July 1, 2010 * 
Summary of Member Data 
Active Members** 456 322 
Average Age 45.9 47.4 
Average Service 12.5 12.3 
Retired Members and Survivors 273 256 
Average Age 72.9 Not Available 
Covered Spouses of Retired Members 118 Not Available 
Discount rate 4.00% 4.00% 
Actuarial Accrued Liability $65,990,530 $50,004,256 
Normal Cost $1,993,379 $1,598,233 
Assets $0 $0 
Unfunded Actuarial Accrued Liability $65,990,530 $50,004,256 
Annual Required Contribution $5,890,142 $4,361,481 
Expected Employer Premiums $2,177,250 $1,983,092 
* 
** 
Based on the actuarial report prepared by Primoris. 
SUMMARY OF PRINCIPAL RESULTS 
Prior to GASB 45, the annual cost recognized was the annual premiums or benefits paid plus administrative
expenses less any participant contributions paid towards the coverage. Under GASB 45, an annual cost for
postemployment coverage is developed for any person who is currently receiving or who is currently actively
employed and may be eligible to receive benefits in the future. In developing the GASB 45 cost for the Town
of Winthrop, the payment of future benefits is determined using the current schedule of premiums under the
GIC plans. We have used a single unadjusted premium rate applicable to both active employees and non-
Medicare-eligible retirees because the GIC would offer the same premium rates if only non-Medicare-eligible
retirees from the Town of Winthrop were covered. These premiums are increased in the future under the
annual healthcare cost trend rate assumptions. The per capita costs utilized in this valuation are detailed
in Section 7, Actuarial Assumptions and Methods. 
We believe the prior report included only active employees covered under a health care plan. 
Page 3 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 1 - SUMMARY 
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 
 
Actives: $35,282,712 
Retirees, Beneficiaries and Surviving Spouses: 30,707,818 
Total: $65,990,530 
ACTUARIAL ASSUMPTIONS 
The most important assumption for GASB 45 is the discount rate, which is used to discount future benefits
to current age. GASB 45 requires that the discount rate accurately reflects the rate of return on assets
dedicated to paying the retiree medical benefits. This means that a traditional pay-as-you-go system, which
pays benefits from the Town's annual budget and not a dedicated trust, must use a discount rate close to
the rate of return on cash. Full pre-funding by use of a dedicated trust with a mixture of stocks and bonds
can employ a higher discount rate that accurately reflects the expected return on trust assets dedicated to
pay retiree medical benefits. For the Town of Winthrop, we selected a 4.0% discount rate to reflect a pay-as-
you-go system with an expected return close to the rate of return on cash. 
CHANGES 
Some assumptions used in this valuation have changed from those used in the July 1, 2010 valuation and
are detailed in Section 7. The major assumption changes are summarized below: 
the mortality table was changed from the RP-2000 Mortality Table (no projection for mortality
improvement) to the RP-2000 Mortality Table projected to 2013 using Scale AA. 
disability rates were incorporated in this valuation to reflect the rates used by the Winthrop Retirement
System and the Massachusetts Teachers Retirement System for the Retirement System pension
valuations. 
the trend rates were changed from 8% in year 1, decreasing by 1% per year to an ultimate rate of 5%, to
9% in year one, decreasing by 1% per year to an ultimate rate of 5%. 
RESULTS 
the termination rates were changed in this valuation to reflect the rates used by the Winthrop
Retirement System and the Massachusetts Teachers Retirement System for the Retirement System
pension valuations, including rates applicable to public safety employees and teachers. 
We have provided results based on a discount rate of 4.0%. As shown in Table 4.3 of Section 4, the Annual
OPEB Cost for the fiscal year ending June 30, 2014 under GASB 45 is $5,667,465 and the estimated
Annual OPEB Cost for the fiscal year ending June 30, 2015 under GASB 45 is $5,832,296. 
The accumulated Net OPEB Obligation as of June 30, 2014 is $15,974,312 and the estimated Net OPEB
Obligation as of June 30, 2015 is $19,383,964. 
The Actuarial Accrued Liability (AAL) as of July 1, 2013 is $65,990,530. The AAL by status breakdown is
shown below: 
the plan participation rate was changed from 100% to 70% to reflect active participation in health care
plans as well as anticipated coverage upon retirement. 
Page 4 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 1 - SUMMARY 
July 1, 2010 July 1, 2011 
$50,004,256 $51,644,224 
1,598,233 1,662,162 
1,983,092 2,096,751 
2,024,827 2,090,732 
$51,644,224 $53,300,367 
July 1, 2012 
$53,300,367 
1,728,649 
2,158,236 
2,158,419 
$55,029,198 
$65,990,530 
($10,961,332) 
 10,961,332 
Whenever the service of a retired employee is attributable to service in more than one Massachusetts
governmental unit and the retired employee receives a healthcare premium contribution, Section 9A1/2 of
M.G.L. Section 32B provides for reimbursement by other governmental units for the portion of healthcare
premium contributions that corresponds to the percentage of the retiree's creditable service that is
attributable for each governmental unit. The other governmental units shall be charged based on the Town
of Winthrop's contribution rate or the contribution rate of the first employer, whichever is lower. 
For purposes of this valuation, we have not taken into account any prior service rendered at other
Massachusetts entities for current or future retirees for the Town of Winthrop nor have we taken into
account any service rendered by former Town of Winthrop employees currently working at or retired from
other Massachusetts entities that may notify the Town of Winthrop of reimbursement due for former Town of
Winthrop employees. 
REIMBURSEMENT FOR HEALTHCARE PREMIUM CONTRIBUTIONS 
Gain/(Loss) 
The actuarial loss of $10,961,332 was mostly comprised of the following: 
Actuarial Accrued Liability, beginning of year 
Normal Cost 
Expected Employer Premiums 
In performing the actuarial valuation, various assumptions are made regarding future premium rates,
mortality, retirement, disability and withdrawal rates as well as investment returns. A comparison of the
results of the current valuation and the prior valuation is made to determine how closely actual experience
relates to expected. Below is the development of the estimated Actuarial Gain/(Loss) for the current period: 
ACTUARIAL GAIN/LOSS ANALYSIS 
Normal Cost 
Expected Employer Premiums 
Interest 
Expected Actuarial Accrued Liability, end of year 
Interest 
Expected Actuarial Accrued Liability, end of year 
Actuarial Accrued Liability, beginning of year 
gain as a result of demographic and premium changes from the prior
valuation 
Actual Actuarial Accrued Liability 
Page 5 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

Market Value of Assets 
Fiscal Year Ending 6/30/2014 6/30/2013 
Assets as of Beginning of Year $0 $0 
Contributions Receivable $0 $0 
Assets as of Beginning of Year $0 $0 
Employer Contributions 
Paid Premiums* $2,082,000 $2,031,235 
OPEB Trust Deposits 0 0 
Total Employer Contributions $2,082,000 $2,031,235 
Benefits Paid (2,082,000) ($2,031,235) 
Expenses 0 0 
Investment Earnings 0 0 
Assets as of End of Year $0 $0 
SECTION 2 - PRINCIPAL VALUATION RESULTS 
The Actuarial Value of Plan Assets is equal to the market value. The asset activity during the 2-year period
July 1, 2012 through June 30, 2014 follows: 
TABLE 2.1 - OPEB TRUST ASSETS 
* Paid premiums for the fisal year ending June 30, 2013 were provided by the Town of Winthrop. Paid
premiums for the fiscal year ending June 30, 2014 were estimated based on the retiree data submitted
by the Town. 
Section 20 of M.G.L. Chapter 32 allows municipal entities to establish an OPEB trust for purposes of
accumulating assets to prefund the OPEB liabilities. We understand that the Town of Winthrop has not
established an irrevocable trust for the purpose of prefunding OPEB liabilities. 
Page 6 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 2 - PRINCIPAL VALUATION RESULTS 
Pay-As-You-Go Full Pre-Funding 
Discount Rate 4.0% 8.0% 
Current Active Employees 
Pre-Medicare Gross Benefit $11,578,070 $7,085,312 
Pre-Medicare Participant Contributions 1,677,856 1,039,943 
Net Pre-Medicare Benefit $9,900,214 $6,045,369 
Post - Medicare Gross Benefit $29,842,014 $12,458,663 
Post - Medicare Participant Contributions 4,459,516 1,873,281 
Net Post - Medicare Benefit $25,382,498 $10,585,382 
Total Current Active Employees $35,282,712 $16,630,751 
Current Retirees 
Pre-Medicare Gross Benefit $4,660,511 $4,127,128 
Pre-Medicare Participant Contributions 619,753 545,930 
Net Pre-Medicare Benefit $4,040,758 $3,581,198 
Post - Medicare Gross Benefit $30,778,264 $20,169,006 
Post - Medicare Participant Contributions 4,111,204 2,696,999 
Net Post - Medicare Benefit $26,667,060 $17,472,007 
Total Current Retirees $30,707,818 $21,053,205 
Total Actuarial Accrued Liability (AAL) $65,990,530 $37,683,956 
The Actuarial Accrued Liability is the portion of the Actuarial Present Value of Future Benefits which is
allocated to all periods prior to a valuation year and therefore is not provided for by future Normal Costs.
Below is the Actuarial Accrued Liability assuming a discount rate of 4.0%, the rate of return on cash, and
8.0%, the rate of return on a dedicated trust if the Town were to fully pre-fund benefits: 
TABLE 2.2 - ACTUARIAL ACCRUED LIABILITY 
Page 7 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 2 - PRINCIPAL VALUATION RESULTS 
Pay-As-You-Go Full Pre-Funding 
Discount Rate 4.0% 8.0% 
Current Active Employees 
Pre-Medicare Gross Benefit $723,591 $323,222 
Pre-Medicare Participant Contributions 100,507 45,662 
Net Pre-Medicare Benefit $623,084 $277,560 
Post - Medicare Gross Benefit $1,606,443 $478,672 
Post - Medicare Participant Contributions 236,148 71,313 
Net Post - Medicare Benefit $1,370,295 $407,359 
Total Current Active Employees $1,993,379 $684,919 
Current Retirees 
Pre-Medicare Gross Benefit $0 $0 
Pre-Medicare Participant Contributions 0 0 
Net Pre-Medicare Benefit $0 $0 
Post - Medicare Gross Benefit $0 $0 
Post - Medicare Participant Contributions 0 0 
Net Post - Medicare Benefit $0 $0 
Total Current Retirees $0 $0 
Total Normal Cost (NC) $1,993,379 $684,919 
TABLE 2.3 - NORMAL COST 
The Normal Cost is the portion of the Actuarial Present Value of Future Benefits which is attributed to
services rendered by active employees in the current year. Below is the Normal Cost assuming a discount
rate of 4.0%, the rate of return on cash, and 8.0%, the rate of return on a dedicated trust if the Town were
to fully pre-fund benefits: 
Page 8 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 2 - PRINCIPAL VALUATION RESULTS 
Pay-As-You-Go Full Pre-Funding 
4.0% 8.0% 
1. Normal Cost $1,993,379 $684,919 
2. Unfunded Actuarial Accrued Liability 
a. Actuarial Accrued Liability $65,990,530 $37,683,956 
b. Actuarial Value of Plan Assets $0 $0 
c. Unfunded Actuarial Accrued Liability $65,990,530 $37,683,956 
3. Amortization of Unfunded Actuarial 
Accrued Liability 
a. Unfunded Actuarial Accrued Liability $65,990,530 $37,683,956 
b. Amortization Period in years 30 30 
c. Factor Increasing Rate 0.0% 0.0% 
d. Amortization Factor 17.98 12.16 
e. Amortization Amount (3.a. / 3.d.) $3,670,219 $3,099,010 
4. $226,544 $302,714 
5. Annual Required Contribution (1. + 3.e. + 4.) $5,890,142 $4,086,643 
6. Net OPEB Obligation / (Asset) beginning of year $12,484,097 Not Applicable 
7. Interest on Net OPEB Obligation at 4.00% $499,364 Not Applicable 
8. Adjustment to Annual Required Contribution at 4.00% $722,041 Not Applicable 
9. Annual OPEB Cost (5. + 7. - 8.) $5,667,465 Not Applicable 
Interest on 1. and 3.e. 
Discount Rate 
TABLE 2.4 - ANNUAL REQUIRED CONTRIBUTION and ANNUAL OPEB COST 
Under GASB 45, the Annual Required Contribution (ARC) of the employer equals the Normal Cost plus a
provision for amortizing the Unfunded Actuarial Accrued Liability. We have assumed level dollar
amortization over the maximum acceptable amortization period of 30 years. For the period beginning July
1, 2013, the ARC, calculated under the parameters of this actuarial valuation, would be: 
Page 9 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

7/1/2014 7/1/2013 7/1/2012 
Fiscal Year Ending 6/30/2013 6/30/2014 6/30/2013 6/30/2012 
Discount rate 4.0% 4.00% 4.00% 4.00% 
Annual Required Contribution $5,890,142 $5,890,142 $4,496,321 $4,418,412 
Interest on Net OPEB Obligation 499,364 499,364 402,131 309,268 
Adjustment to annual required contribution 722,041 (722,041) (309,376) (309,376) 
Annual OPEB cost/(expense) $5,667,465 $5,667,465 $4,589,076 $4,418,304 
Employer contributions (including subsidy) 2,177,250 (2,177,250) (2,158,236) (2,096,751) 
Change in Net OPEB Obligation $3,490,215 $3,490,215 $2,430,840 $2,321,553 
Net OPEB Obligation (Asset) - beginning of year $15,974,312 $12,484,097 $10,053,257 $7,731,704 
Net OPEB Obligation (Asset) - end of year $19,464,527 $15,974,312 $12,484,097 $10,053,257 
Fiscal Year
Ended 
Annual OPEB
Cost 
Percentage of
Annual OPEB
Cost
Contributed 
Net OPEB
Obligation 
6/30/2014 5,667,465 38.4% 15,974,312 
6/30/2013 4,589,076 47.0% 12,484,097 
6/30/2012 4,418,304 47.5% 10,053,257 
Actuarial
Valuation
Date 
Actuarial
Value of
Assets
(a) 
Actuarial
Accrued
Liability
(b) 
Unfunded
AAL (UAAL)
(b-a) 
Funded
Ratio
(a/b) 
Covered
Payroll
(c) 
UAAL as a
Percentage
of Covered
Payroll
((b-a) / c) 
7/1/2013 0 65,990,530 65,990,530 0.00% 20,795,753 317.3% 
7/1/2010 0 50,004,256 50,004,256 0.00% Not Available Not available 
7/1/2008 0 49,693,455 49,693,455 0.00% Not Available Not available 
SECTION 3 - GASB 45 ACCOUNTING DISCLOSURE 
GASB 45 requires disclosure of the annual OPEB cost, the Net OPEB Obligation and the Schedule of Funding Progress. In
addition, information about the Actuarial Methods and Assumptions used in the valuation and a summary of the
Substantive Plan Provisions are disclosed, which are provided in Section 6 and Section 7, respectively. 
Schedule of Funding Progress 
Plan History 
Annual OPEB Cost and Net OPEB Obligation 
Page 10 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

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Assets are assumed to grow annually at the selected discount rate plus Additional Funding amounts
made at the end of each fiscal year. 
Actuarial Accrued Liability (AAL), end of year, equals AAL, beginning of year, plus Normal Cost less
Expected Employer Premiums plus interest on these items. 
Amortization Amount with Interest is the amount necessary to amortize the Unfunded Actuarial Accrued
Liability over 30 years at a discount rate of 8% on a closed amortization basis. The closed amortization
period is 30 years at year one declining to zero after 30 years. This method fully funds the UAL at the
end of 30 years. 
Assumes Additional Funding of the excess of the ARC over the Expected Employer Premiums. 
Table 4.2 is based on fully funding the Annual Required Contribution (ARC) each year. 
The assumed discount rate is 8%. 
Amortization Amount with Interest is the amount necessary to amortize the Unfunded Actuarial Accrued
Liability over 30 years at a discount rate of 4% on an open amortization basis. The open amortization
period is 30 years, recalcuated at each valuation date. 
Unfunded Actuarial Accrued Liability (UAAL) equals the AAL less Assets. 
the Annual Required Contribution (ARC) is the sum of the Normal Cost with Interest and the Amortization
Amount with Interest. 
The assumed discount rate is 4%. 
Table 4.1 is based on funding the expected Employer share of premiums on a pay-as-you-go basis. 
SECTION 4 - FORECASTS 
OVERVIEW 
In Section 4, we have provided 30-year forecasts of the annual funding requirements, accrued liability,
assets and unfunded actuarial accrued liability under a pay-as-you-go scenario and a fully-funded funding
scenario. The entries in Tables 4.1 and 4.2 are based on the assumptions stated below: 
Expected Employer Premiums are developed in the actuarial valuation and are based on the
assumptions detailed in Section 7. 
Normal Cost with interest is assumed to increase annually by 4%. 
Page 11 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

FYE June
30 
(1)
Normal Cost 
(2)
Actuarial Accrued
Liability 
(3)
Assets, BOY 
(4)
Unfunded Actuarial
Accrued Liability
(2) - (3) 
(5)
Expected
Employer
Premiums 
(6)
Employer
Contributions 
(7)
Amortization
Amount 
(8)
Interest 
(9)
ARC
(1) + (7) + (8) 
2014 1,993,379 65,990,530 - 65,990,530 2,177,250 2,177,250 3,670,219 226,544 5,890,142 
2015 2,073,114 68,482,897 - 68,482,897 2,422,644 2,422,644 3,808,837 235,278 6,117,229 
2016 2,156,039 70,907,630 - 70,907,630 2,649,133 2,649,133 3,943,695 243,989 6,343,723 
2017 2,242,281 73,284,620 - 73,284,620 2,550,452 2,550,452 4,075,897 252,727 6,570,905 
2018 2,331,972 75,947,017 - 75,947,017 2,683,794 2,683,794 4,223,972 262,238 6,818,182 
2019 2,425,251 78,673,205 - 78,673,205 2,794,052 2,794,052 4,375,595 272,034 7,072,880 
2020 2,522,261 81,493,010 - 81,493,010 2,849,909 2,849,909 4,532,425 282,187 7,336,873 
2021 2,623,151 84,469,534 - 84,469,534 2,929,366 2,929,366 4,697,972 292,845 7,613,968 
2022 2,728,077 87,589,014 - 87,589,014 3,030,796 3,030,796 4,871,469 303,982 7,903,528 
2023 2,837,200 90,838,957 - 90,838,957 3,131,767 3,131,767 5,052,222 315,577 8,204,999 
2024 2,950,688 94,229,415 - 94,229,415 3,242,046 3,242,046 5,240,791 327,659 8,519,138 
2025 3,068,716 97,761,056 - 97,761,056 3,323,817 3,323,817 5,437,211 340,237 8,846,164 
2026 3,191,465 101,473,322 - 101,473,322 3,409,496 3,409,496 5,643,678 353,406 9,188,549 
2027 3,319,124 105,374,361 - 105,374,361 3,483,769 3,483,769 5,860,643 367,191 9,546,958 
2028 3,451,889 109,488,464 - 109,488,464 3,546,343 3,546,343 6,089,459 381,654 9,923,002 
2029 3,589,965 113,841,393 - 113,841,393 3,589,042 3,589,042 6,331,557 396,861 10,318,383 
2030 3,733,564 118,468,493 - 118,468,493 3,624,284 3,624,284 6,588,904 412,899 10,735,367 
2031 3,882,907 123,394,081 - 123,394,081 3,659,324 3,659,324 6,862,852 429,830 11,175,589 
2032 4,038,223 128,636,275 - 128,636,275 3,657,513 3,657,513 7,154,409 447,705 11,640,337 
2033 4,199,752 134,251,532 - 134,251,532 3,655,515 3,655,515 7,466,715 466,659 12,133,126 
2034 4,367,742 140,261,427 - 140,261,427 3,616,015 3,616,015 7,800,969 486,748 12,655,459 
2035 4,542,452 146,726,710 - 146,726,710 3,570,040 3,570,040 8,160,551 508,120 13,211,123 
2036 4,724,150 153,679,188 - 153,679,188 3,545,918 3,545,918 8,547,230 530,855 13,802,235 
2037 4,913,116 161,123,331 - 161,123,331 3,525,292 3,525,292 8,961,253 554,975 14,429,344 
2038 5,109,641 169,082,799 - 169,082,799 3,483,542 3,483,542 9,403,938 580,543 15,094,122 
2039 5,314,027 177,607,608 - 177,607,608 3,495,755 3,495,755 9,878,065 607,684 15,799,776 
2040 5,526,588 186,673,516 - 186,673,516 3,468,762 3,468,762 10,382,287 636,355 16,545,230 
2041 5,747,652 196,350,651 - 196,350,651 3,450,041 3,450,041 10,920,503 666,726 17,334,881 
2042 5,977,558 206,663,870 - 206,663,870 3,432,573 3,432,573 11,494,097 698,866 18,170,521 
2043 6,216,660 217,646,534 - 217,646,534 3,354,853 3,354,853 12,104,924 732,863 19,054,447 
30 years open, 4.0% discount rate. 
SECTION 4 - FORECASTS 
TABLE 4.1 - ANNUAL REQUIRED CONTRIBUTIONS 
Page 12 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

(1)
FYE June
30 
(2)
Expected
Employer
Premiums 
(3)
AAL at
Beginning of
Year 
(4)
Assets at
Beginning of
Year 
(5)
Normal Cost
with Interest 
(6)
Amortization
Amount
with Interest 
(7)
ARC
(5) + (6) 
(8)
Additional
Funding
(7) - (2) 
(9)
Assets at End
of Year 
(10)
AAL at End of
Year 
(11)
UAAL at End of
Year
(10) - (9) 
2014 2,177,250 37,683,956 - 739,713 3,346,930 4,086,643 1,909,393 - 39,175,720 39,175,720 
2015 2,422,644 39,175,720 - 769,301 3,511,185 4,280,486 1,857,842 1,762,801 40,561,394 38,798,593 
2016 2,649,133 40,561,394 1,762,801 800,073 3,509,420 4,309,494 1,660,361 3,460,258 41,853,318 38,393,060 
2017 2,550,452 41,853,318 3,460,258 832,076 3,510,966 4,343,042 1,792,590 5,429,614 43,383,153 37,953,539 
2018 2,683,794 43,383,153 5,429,614 865,359 3,512,410 4,377,769 1,693,975 7,452,671 44,930,084 37,477,413 
2019 2,794,052 44,930,084 7,452,671 899,973 3,510,460 4,410,434 1,616,382 9,555,655 46,520,801 36,965,145 
2020 2,849,909 46,520,801 9,555,655 935,972 3,511,201 4,447,173 1,597,265 11,805,569 48,216,725 36,411,156 
2021 2,929,366 48,216,725 11,805,569 973,411 3,511,076 4,484,487 1,555,121 14,190,215 50,003,188 35,812,973 
2022 3,030,796 50,003,188 14,190,215 1,012,348 3,509,801 4,522,149 1,491,353 16,697,886 51,866,095 35,168,209 
2023 3,131,767 51,866,095 16,697,886 1,052,842 3,510,320 4,563,162 1,431,395 19,342,251 53,813,597 34,471,346 
2024 3,242,046 53,813,597 19,342,251 1,094,955 3,512,175 4,607,130 1,365,084 22,127,528 55,844,406 33,716,878 
2025 3,323,817 55,844,406 22,127,528 1,138,753 3,511,497 4,650,251 1,326,434 25,093,770 57,996,501 32,902,731 
2026 3,409,496 57,996,501 25,093,770 1,184,304 3,511,359 4,695,662 1,286,167 28,253,681 60,277,272 32,023,591 
2027 3,483,769 60,277,272 28,253,681 1,231,676 3,511,216 4,742,892 1,259,123 31,636,429 62,710,692 31,074,262 
2028 3,546,343 62,710,692 31,636,429 1,280,943 3,510,482 4,791,424 1,245,082 35,273,300 65,323,022 30,049,722 
2029 3,589,042 65,323,022 35,273,300 1,332,180 3,512,305 4,844,486 1,255,443 39,209,808 68,151,202 28,941,394 
2030 3,624,284 68,151,202 39,209,808 1,385,468 3,511,989 4,897,457 1,273,174 43,477,584 71,222,300 27,744,716 
2031 3,659,324 71,222,300 43,477,584 1,440,886 3,508,699 4,949,586 1,290,262 48,102,495 74,558,089 26,455,594 
2032 3,657,513 74,558,089 48,102,495 1,498,522 3,510,079 5,008,601 1,351,088 53,158,297 78,220,260 25,061,963 
2033 3,655,515 78,220,260 53,158,297 1,558,463 3,510,625 5,069,088 1,413,573 58,681,126 82,237,421 23,556,295 
2034 3,616,015 82,237,421 58,681,126 1,620,801 3,509,076 5,129,877 1,513,862 64,747,620 86,679,343 21,931,723 
2035 3,570,040 86,679,343 64,747,620 1,685,633 3,509,076 5,194,709 1,624,669 71,412,044 91,589,229 20,177,185 
2036 3,545,918 91,589,229 71,412,044 1,753,059 3,509,076 5,262,134 1,716,216 78,702,116 96,984,400 18,282,284 
2037 3,525,292 96,984,400 78,702,116 1,823,181 3,513,321 5,336,502 1,811,211 86,671,197 102,902,742 16,231,545 
2038 3,483,542 102,902,742 86,671,197 1,896,108 3,513,040 5,409,148 1,925,606 95,393,838 109,410,867 14,017,029 
2039 3,495,755 109,410,867 95,393,838 1,971,953 3,512,388 5,484,340 1,988,586 104,876,790 116,502,794 11,626,004 
2040 3,468,762 116,502,794 104,876,790 2,050,831 3,507,286 5,558,117 2,089,355 115,220,207 124,269,005 9,048,798 
2041 3,450,041 124,269,005 115,220,207 2,132,864 3,515,360 5,648,224 2,198,183 126,500,660 132,758,001 6,257,341 
2042 3,432,573 132,758,001 126,500,660 2,218,178 3,501,517 5,719,696 2,287,123 138,773,175 142,029,586 3,256,411 
2043 3,354,853 142,029,586 138,773,175 2,306,906 3,516,924 5,823,830 2,468,977 152,212,393 152,212,393 - 
2044 3,278,994 152,212,393 152,212,393 2,399,182 - 2,399,182 - 163,380,936 163,380,936 - 
30-years closed, 8.0% discount rate. 
SECTION 4 - FORECASTS 
TABLE 4.2 - Funding the Annual Required Contribution (ARC) 
Page 13 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

FYE June
30 ARC 
Interest on
Net OPEB
Obligation 
ARC
Adjustment 
Amortization
Factor 
Annual
OPEB Cost 
Employer
Contributions 
Change in Net
OPEB
Obligation 
Net OPEB
Obligation
Balance 
12,484,097 
2014 5,890,142 499,364 722,041 17.29 5,667,465 2,177,250 3,490,215 15,974,312 
2015 6,117,229 638,972 923,905 17.29 5,832,296 2,422,644 3,409,652 19,383,964 
2016 6,343,723 775,359 1,121,108 17.29 5,997,974 2,649,133 3,348,841 22,732,805 
2017 6,570,905 909,312 1,314,795 17.29 6,165,422 2,550,452 3,614,970 26,347,776 
2018 6,818,182 1,053,911 1,523,874 17.29 6,348,219 2,683,794 3,664,425 30,012,201 
2019 7,072,880 1,200,488 1,735,813 17.29 6,537,555 2,794,052 3,743,503 33,755,704 
2020 7,336,873 1,350,228 1,952,325 17.29 6,734,776 2,849,909 3,884,867 37,640,572 
2021 7,613,968 1,505,623 2,177,014 17.29 6,942,577 2,929,366 4,013,211 41,653,783 
2022 7,903,528 1,666,151 2,409,126 17.29 7,160,553 3,030,796 4,129,757 45,783,540 
2023 8,204,999 1,831,342 2,647,978 17.29 7,388,363 3,131,767 4,256,596 50,040,136 
Notes: 
1. ARC and Employer Contributions are from 30-Year Forecast of Annual Required Contributions (Table 4.1). 
2. 
3. ARC Adjustment is the prior year Net OPEB Obligation Balance amortized over 30 years. 
4. OPEB Cost is the ARC plus Interest on Net OPEB Obligation less ARC Adjustment. 
5. Change in Net OPEB Obligation is the difference between the OPEB Cost and Employer Contributions. 
6. Net OPEB Obligation is the prior year Net OPEB Obligation Balance plus Change in Net OPEB Obligation. 
7. Year one Interest on Net OPEB Obligation and ARC Adjustment computed at prior discount rate of 4.00%. 
8. Subsequent years' Interest on Net OPEB Obligation and ARC Adjustment computed at current discount rate of 4.00%. 
Interest on Net OPEB Obligation is computed on the prior year Net OPEB Obligation Balance. 
TABLE 4.3 - ANNUAL OPEB COST and NET OPEB OBLIGATION 
SECTION 4 - FORECASTS 
Page 14 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

Assumed Trend Trend +1% Trend -1% 
Discount Rate 4.0% 4.0% 4.0% 
Current Active Employees 
Pre-Medicare Gross Benefit $11,578,070 $13,232,818 $10,191,206 
Pre-Medicare Participant Contributions 1,677,856 1,912,029 1,481,100 
Net Pre-Medicare Benefit $9,900,214 $11,320,789 $8,710,106 
Post - Medicare Gross Benefit $29,842,014 $38,232,338 $23,589,765 
Post - Medicare Participant Contributions 4,459,516 5,699,422 3,533,619 
Net Post - Medicare Benefit $25,382,498 $32,532,916 $20,056,146 
Total Current Active Employees $35,282,712 $43,853,705 $28,766,252 
Current Retirees 
Pre-Medicare Gross Benefit $4,660,511 $4,790,882 $4,537,145 
Pre-Medicare Participant Contributions 619,753 638,106 602,434 
Net Pre-Medicare Benefit $4,040,758 $4,152,776 $3,934,711 
Post - Medicare Gross Benefit $30,778,264 $34,590,340 $27,550,448 
Post - Medicare Participant Contributions 4,111,204 4,618,395 3,681,823 
Net Post - Medicare Benefit $26,667,060 $29,971,945 $23,868,625 
Total Current Retirees $30,707,818 $34,124,721 $27,803,336 
Total Actuarial Accrued Liability (AAL) $65,990,530 $77,978,426 $56,569,588 
SECTION 5 - SENSITIVITY TO HEALTH CARE COST TREND RATE 
Below we illustrate the sensitivity of Actuarial Accrued Liability to a one percentage increase and decrease in
health care cost trend assumption for each future year: 
TABLE 5.1 - ACTUARIAL ACCRUED LIABILITY 
Page 15 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 5 - SENSITIVITY TO HEALTH CARE COST TREND RATE 
Assumed Trend Trend +1% Trend -1% 
Discount Rate 4.0% 4.0% 4.0% 
Current Active Employees 
Pre-Medicare Gross Benefit $723,591 $895,759 $587,716 
Pre-Medicare Participant Contributions 100,507 124,062 81,886 
Net Pre-Medicare Benefit $623,084 $771,697 $505,830 
Post - Medicare Gross Benefit $1,606,443 $2,247,682 $1,163,297 
Post - Medicare Participant Contributions 236,148 329,188 171,643 
Net Post - Medicare Benefit $1,370,295 $1,918,494 $991,654 
Total Current Active Employees $1,993,379 $2,690,191 $1,497,484 
Current Retirees 
Pre-Medicare Gross Benefit $0 $0 $0 
Pre-Medicare Participant Contributions 0 0 0 
Net Pre-Medicare Benefit $0 $0 $0 
Post - Medicare Gross Benefit $0 $0 $0 
Post - Medicare Participant Contributions 0 0 0 
Net Post - Medicare Benefit $0 $0 $0 
Total Current Retirees $0 $0 $0 
Total Normal Cost $1,993,379 $2,690,191 $1,497,484 
Below we illustrate the sensitivity of Normal Cost to a one percentage increase and decrease in health care
cost trend assumption for each future year: 
TABLE 5.2 - NORMAL COST 
Page 16 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

Eligibility: 
Medical Premium Rates: 
Individual Family 
$471.78 $1,132.26 
$593.45 $1,424.28 
$680.75 $1,661.01 
$544.59 $1,328.81 
$459.40 $1,138.95 
$457.91 $1,213.45 
$627.17 $1,521.18 
$505.07 $1,223.25 
$920.94 $2,149.50 
$879.28 $2,052.87 
$428.78 $1,029.06 
$624.55 $1,490.51 
$274.86 
$395.19 
$363.49 
$385.92 
$254.27 
$381.22 
$370.28 
Group 4 employees hired before April 2, 2012: retire after attaining age 55
or any age with 20 or more years of service 
HP Medicare Enhanced 
Tufts Medicare Complement 
Fallon Senior 
UniCare OME w/CIC 
UniCare OME w/o CIC 
Fallon Select Care 
HP Independence Plan 
HP Primary Choice 
Health New England 
NHP Care (Neighborhood Health Plan) 
SECTION 6 - PLAN PROVISIONS 
Group 1 employees hired before April 2, 2012: retire after attaining age 55
with 10 or more years of service or any age with 20 or more years of service 
Non-Medicare Plans - July 1, 2013 
Fallon Direct Care 
Group 1 employees hired after April 1, 2012: retire after attaining age 60
with 10 or more years of service 
Group 4 employees hired after April 1, 2012: retire after attaining age 55 
The total monthly cost by plan are shown below: 
Tufts Health Plan Navigator 
Tufts Health Plan Spirit 
UniCare Basic with CIC 
UniCare Basic without CIC 
UniCare Community Choice 
UniCare PLUS 
Medicare Plans - July 1, 2013 
Tufts Medicare Preferred 
Health NE MedPlus 
Page 17 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 6 - PLAN PROVISIONS 
Participant Contributions: 
Continuation of Coverage to
Spouse After Death of Retiree: 
Life Insurance Benefit: 
Life Insurance Premium: 
Life Insurance Contributions: 
PPACA Excise Tax: 
Teachers who retired before July 1, 2008 contribute 10%. 
All others enrolled in UniCare State Indemnity plans contribute 35%. 
All others contribute 15%. 
Retired employees contribute $1.61 per month for life insurance. 
Retirees are eligible for a $2,000 life insurance benefit. 
The total monthly cost is $3.22. 
Surviving spouse may continue coverage for lifetime by paying required
medical premium rates. 
Retired employees contribute between 10% and 35% of the total medical
premium rates, as follows: 
The Patient Protection and Affordable Care Act (PPACA) applies a 40% excise
tax to the cost of plan benefits in excess of statutory thresholds beginning in
2018. The 2018 thresholds are assumed to be $10,200 for individual and
$27,500 for family coverage and increase by CPI in future years. The annual
limits are increased by $1,650 for individual and $3,450 for family coverage
for retirees not eligible for Medicare benefits. 
Page 18 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

Valuation Date: 
Discount Rates: 
Amortization Method: 
Health Care Cost Trend Rates: 
Current Prior 
9.00% 8.00% 
8.00% 7.00% 
7.00% 6.00% 
6.00% 5.00% 
5.00% 5.00% 
5.00% 5.00% 
CPI: 
Mortality Table: 
Turnover Rates: 
Service Rate Service Rate 
0 15.00% 0-10 1.50% 
1 12.00% 11+ 0.00% 
2 10.00% 
3 9.00% 
4 8.00% 
5-9 7.60% 
10-14 5.40% 
15-19 3.30% 
20-24 2.00% 
25-29 1.00% 
30+ 0.00% 
1 
Ultimate 
Groups 1 and 2 
SECTION 7 - ACTUARIAL ASSUMPTIONS AND METHODS 
July 1, 2013 
4.00% pay-as-you-go. 
Level dollar amount over thirty (30) years on an open amortization period for
pay-as-you-go. 
8.00% full pre-funding. 
Level dollar amount over thirty (30) years on a closed amortization period
for full pre-funding. 
Year 
2 
RP-2000 Healthy Annuitant Table, projected to 2013, using Scale AA. 
3 
Group 4 
4 
5 
Non-Teachers: 
3% per year. 
Page 19 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 7 - ACTUARIAL ASSUMPTIONS AND METHODS 
Turnover Rates: (continued) 
Age Male Female Male Female Male Female 
20 12.0% 10.0% 4.5% 9.0% 1.0% 5.0% 
30 11.4% 12.0% 4.5% 9.0% 1.0% 5.0% 
40 9.7% 11.0% 5.4% 6.5% 1.7% 2.9% 
50 10.0% 8.2% 4.8% 4.2% 2.2% 2.1% 
Disability Rates: 
Age Rate Age Rate 
20 0.01% 20 0.10% 
30 0.03% 30 0.30% 
40 0.10% 40 0.30% 
50 0.19% 50 1.25% 
Age Rate 
20 0.004% 
30 0.006% 
40 0.010% 
50 0.050% 
60 0.100% 
10+ 
Teachers: 
Service 
Teachers: 
0 
Groups 1 and 2 
5 
Group 4 
Non-Teachers: 
Page 20 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 7 - ACTUARIAL ASSUMPTIONS AND METHODS 
Retirement Rates: 
Group 4 
Age Male Female All 
45 0.00% 0.00% 1.00% 
46 0.00% 0.00% 1.00% 
47 0.00% 0.00% 1.00% 
48 0.00% 0.00% 1.00% 
49 0.00% 0.00% 1.00% 
50 1.00% 1.50% 2.00% 
51 1.00% 1.50% 2.00% 
52 1.00% 2.00% 2.00% 
53 1.00% 2.50% 5.00% 
54 2.00% 2.50% 7.50% 
55 2.00% 5.50% 15.00% 
56 2.50% 6.50% 10.00% 
57 2.50% 6.50% 10.00% 
58 5.00% 6.50% 10.00% 
59 6.50% 6.50% 15.00% 
60 12.00% 5.00% 20.00% 
61 20.00% 13.00% 20.00% 
62 30.00% 15.00% 25.00% 
63 25.00% 12.50% 25.00% 
64 22.00% 18.00% 30.00% 
65 40.00% 15.00% 100.00% 
66 25.00% 20.00% 
67 25.00% 20.00% 
68 30.00% 25.00% 
69 30.00% 20.00% 
70 100.00% 100.00% 
Non-Teachers: 
Groups 1 and 2 
Page 21 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 7 - ACTUARIAL ASSUMPTIONS AND METHODS 
Retirement Rates: (continued) 
Age Male Female Male Female Male Female 
45 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 
50 0.0% 0.0% 1.0% 1.5% 2.0% 2.0% 
55 3.0% 2.0% 3.0% 3.0% 6.0% 6.0% 
60 15.0% 20.0% 20.0% 16.0% 50.0% 35.0% 
62 20.0% 25.0% 30.0% 30.0% 40.0% 40.0% 
65 40.0% 30.0% 40.0% 30.0% 50.0% 35.0% 
69 40.0% 30.0% 30.0% 30.0% 50.0% 30.0% 
70 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 
Medical Plan Participation: 
Life Insurance Participation: 
Dependent Status: 
Medical Per Capita Costs: 
Age Group 2 Cost 
Under 65 $9,905 
65 and Over $4,664 
70% of eligible retirees will elect to participate. 
20-30 30+ Less than 20 
Years of Service 
Annual per capita costs for the fiscal year beginning July 1, 2013 are as
follows: 
50% of employees are assumed to retire with a covered spouse. 
For current retirees, the actual census information provided is used. 
Teachers: 
Male spouses are assumed to be three years older and female spouses are
assumed to be three years younger than the retired employee. 
70% of eligible retirees will elect to participate. 
Page 22 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 7 - ACTUARIAL ASSUMPTIONS AND METHODS 
Retiree Contributions: 
Age 10% 15% 35% 
Under 65 $991 $1,486 $3,467 
65 and older $466 $700 $1,632 
Excise Tax: 
Actuarial Cost Method: 
Employee Data: 
Submitted data for retired Teachers did not contain gender or
birth dates. We assumed that retired Teachers enrolled in pre-
Medicare plans were age 60 as of the valuation date and that
retired Teachers enrolled in Medicare plans were age 75 as of
the valuation date. Gender codes were assigned based on
names provided. 
We assumed female spouses were three years younger than
retired male teachers with family coverage and male spouses
were three years older than retired female teachers with family
coverage as no spouses' birth dates were provided in the data. 
Employee and retiree data were submitted by the Town. We made
reasonable adjustments for missing or invalid data. 
Annual per capita participant contributions for the fiscal year beginning July
1, 2013 are as follows: 
Projected Unit Credit. The costs of each employee's postemployment
benefits are allocated on a pro rata basis from the employee's date of hire
to the date the employee is fully eligible for benefits. 
For purposes of estimating the excise tax, per capita plan costs are
developed for individual and family coverage for both Medicare and non-
Medicare members. These plan costs are compared to the thresholds
stipulated in the Patient Protection and Affordable Care Act (PPACA).
Beginning in 2018, a 40% excise tax is applied on the excess of the plan
costs over the thresholds, which increase annually by CPI. 
Page 23 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

Age 0 to 4 5 to 9 10 to 14 15 to 19 20 to 24 25 to 29 30 to 34 35 to 39 40 & up Total Percent 
Under 25 14 1 0 0 0 0 0 0 0 15 3% 
25 to 29 42 4 2 0 0 0 0 0 0 48 11% 
30 to 34 31 21 6 0 0 0 0 0 0 58 13% 
35 to 39 11 17 7 1 0 0 0 0 0 36 8% 
40 to 44 12 9 19 4 3 1 0 0 0 48 11% 
45 to 49 6 19 14 11 12 1 0 0 0 63 13% 
50 to 54 6 13 13 10 5 11 0 0 0 58 13% 
55 to 59 9 2 8 12 11 8 11 1 0 62 13% 
60 to 64 2 6 5 9 6 8 3 3 2 44 10% 
65 to 69 1 2 1 2 3 3 0 0 3 15 3% 
70 & up 0 0 2 1 2 1 1 0 2 9 2% 
Total 134 94 77 50 42 33 15 4 7 456 
Percent 29% 21% 17% 11% 9% 7% 3% 1% 2% 100% 
Average Age: 45.9 Average Service: 12.5 
TABLE 8.1 - ACTIVE EMPLOYEES BY AGE and YEARS OF SERVICE AS OF JULY 1, 2013 
Years of Service 
SECTION 8 - PLAN MEMBER INFORMATION 
Page 24 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

TABLE 8.2 - RETIRED PLAN PARTICIPANTS, COVERED SPOUSES and SURVIVORS AS OF JULY 1, 2013 
SECTION 8 - PLAN MEMBER INFORMATION 
Non-Medicare Plans: 
Age 
HP Independence
Plan 
HP Primary Choice 
Tufts Health Plan
Navigator 
Tufts Health Plan
Spirit 
UniCare Basic with
CIC 
UniCare Community
Choice 
Fallon Senior 
HP Medicare
Enhanced 
Tufts Medicare
Complement 
Tufts Medicare
Preferred 
UniCare OME w/CIC 
Life Only 
Total 
Under 40 0 0 0 0 0 0 0 0 0 0 0 0 0 
40 to 44 0 0 0 0 0 0 0 0 0 0 0 0 0 
45 to 49 1 0 0 0 0 0 0 0 0 0 0 0 1 
50 to 54 2 0 1 0 0 0 0 0 0 0 0 0 3 
55 to 59 2 0 0 0 0 0 0 1 0 0 0 1 4 
60 to 64 31 4 3 1 15 1 0 6 0 0 0 1 62 
65 to 69 7 0 0 0 0 0 0 13 0 0 1 2 23 
70 to 74 5 1 0 0 6 0 0 24 2 2 0 5 45 
75 to 79 1 0 0 0 0 0 1 39 0 0 51 2 94 
80 to 84 0 0 0 0 0 0 0 12 0 0 0 2 14 
85 to 89 0 0 0 0 0 0 0 11 0 0 0 4 15 
90+ 0 0 0 0 0 0 0 12 0 0 0 0 12 
Total 49 5 4 1 21 1 1 118 2 2 52 17 273 
Covered
Spouses 31 3 3 1 8 0 0 47 1 1 23 118 
In addition, there are 0 retirees with life insurance coverage who are not covered under any medical plan. 
Page 25 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 9 - GASB 45 GLOSSARY OF TERMS 
Explicit Subsidy – The difference between (a) the blended rates based on combined active and retired
member experience and (b) actual cash contributions made by the employer. 
Annual Required Contribution (ARC) – Includes the employer's Normal Cost and a provision for amortizing
the Unfunded Actuarial Accrued Liability. 
Annual OPEB Cost - The accrual basis annual cost for the OPEB plan sponsored by the employer. In the
year of implementation of GASB 45, the Annual OPEB Cost equals the ARC. In subsequent years, if an
employer has a Net OPEB Obligation, Annual OPEB Cost equals the ARC plus one year's interest on the Net
OPEB Obligation plus an adjustment to the ARC. 
Funded Ratio – The Actuarial Value of Assets expressed as a percentage of the Actuarial Accrued Liability. 
Health Cost Trend Rate – The rate of change in per capita health claims cost over time as a result of factors
such as medical inflation, utilization of healthcare services, plan design, and technological developments. 
Implicit Subsidy – In an experience-rated healthcare plan that includes both active employees and retirees
with blended premium rates for all plan members, the difference between (a) the age-adjusted premiums
approximating claim costs for retirees in the group and (b) the blended rates based on combined active and
retired member experience. 
Actuarial Accrued Liability – The portion of the Actuarial Present Value of future benefits which is allocated
to all periods prior to a valuation year and therefore is not provided by future Normal Costs. 
Actuarial Assumptions – Assumptions as to the occurrence of future events affecting OPEB costs, such as
mortality, withdrawal, disablement and retirement; changes in compensation and Government provided
pension benefits; rates of investment earnings and asset appreciation or depreciation; procedures used to
determine the Actuarial Value of Assets; characteristics of future entrants for Open Group Actuarial Cost
Methods; and other relevant items. 
Actuarial Value of Assets – The value of plan assets used in an actuarial valuation. The Actuarial Value of
Assets may reflect smoothing techniques intended to dampen year-to-year fluctuations in the market value
of assets. 
Actuarial Present Value of Future Benefits – The present value of the cost to finance all benefits payable in
the future, discounted to reflect the probability of payment and the time value of money. 
Actuarial Valuation – the determination, as of a valuation date, of the Normal Cost, Actuarial Accrued
Liability, Actuarial Value of Assets and related Actuarial Present Values for an OPEB plan. 
Page 26 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

SECTION 9 - GASB 45 GLOSSARY OF TERMS 
• 
• 
• 
Projected Unit Credit Actuarial Cost Method – A method under which the projected benefits of each
individual included in an Actuarial Valuation are allocated by a consistent formula to valuation years.
Projected Unit Credit is one of the actuarial cost methods allowed and most often used for developing
liabilities under GASB 45. 
Plan Assets – Investments segregated and restricted in a trust or similar arrangement under which: 
Pay-As-You-Go – A method of financing an OPEB plan under which the contributions to the plan are
generally made at about the same time and in about the same amount as benefit payments and expenses
becoming due. 
assets are legally protected from creditors. 
employer contributions to the trust are irrevocable, 
Substantive Plan – The terms of an OPEB plan as understood by the employer and plan members. 
Unfunded Actuarial Accrued Liability – The excess of Actuarial Accrued Liability over the Actuarial Value of
Assets. 
OPEB – Other Postemployment Benefits including medical, dental, vision, hearing and life insurance
benefits. 
Present Value of Future Benefits – The actuarial present value of the cost to finance benefits payable in the
future, discounted to reflect the expected effects of the time value of money and the probabilities of
payment. 
assets are dedicated to providing plan benefits, and 
Net OPEB Obligation – The cumulative excess since adoption of GASB 45 of Annual OPEB Cost over the
employer's contributions to the plan. 
Normal Cost – The portion of the Actuarial Present Value of Future Benefits which is allocated to a valuation
year. 
Page 27 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

Unit Town School Recreation Rink #N/A Total 
1 2 5 6 
Summary of Member Data 
Active Members 223 229 3 1 0 456 
Average Age 49.5 42.4 44.2 55.6 0.0 45.9 
Average Service 13.5 11.5 11.7 0.4 0.0 12.5 
Retired Members and Survivors 142 131 0 0 0 273 
Average Age 75.0 70.6 0.0 0.0 0.0 72.9 
Actuarial Accrued Liability - July 1, 2013 
Active Employees 18,933,643 16,154,336 193,196 1,537 0 35,282,712 
Retired Employees and Survivors 12,716,711 17,991,107 0 0 0 30,707,818 
Total 31,650,354 34,145,443 193,196 1,537 0 65,990,530 
Actuarial Value of Plan Assets - July 1, 2013 0 0 0 0 0 0 
Unfunded Actuarial Accrued Liability 31,650,354 34,145,443 193,196 1,537 0 65,990,530 
Annual Required Contribution (ARC) for FYE 2014 
Normal Cost 882,750 1,090,818 15,985 3,826 0 1,993,379 
Amortization of UAL 1,760,309 1,899,080 10,745 85 0 3,670,219 
Interest 105,722 119,597 1,069 156 0 226,544 
Total 2,748,781 3,109,495 27,799 4,067 0 5,890,142 
Annual OPEB Cost for FYE 2014 
Annual Required Contribution 2,748,781 3,109,495 27,799 4,067 0 5,890,142 
Interest on Net OPEB Obligation 233,041 263,621 2,357 345 0 499,364 
Adjustment to annual required contribution (336,958) (381,176) (3,408) (499) 0 (722,041) 
Annual OPEB cost/(expense) 2,644,864 2,991,940 26,748 3,913 0 5,667,465 
Expected Employer premiums (939,471) (1,237,779) 0 0 0 (2,177,250) 
OPEB Trust contributions 0 0 0 0 0 0 
Employer contributions (including subsidy) (939,471) (1,237,779) 0 0 0 (2,177,250) 
Change in Net OPEB Obligation 1,705,393 1,754,161 26,748 3,913 0 3,490,215 
Net OPEB Obligation (Asset) - beginning of year* 5,826,013 6,590,544 58,920 8,620 0 12,484,097 
Net OPEB Obligation (Asset) - end of year 7,531,406 8,344,705 85,668 12,533 0 15,974,312 
SECTION 10 - RESULTS BY SUBGROUP 
Page 28 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013

Unit Town School Recreation Rink #N/A Total 
1 2 5 6 
SECTION 10 - RESULTS BY SUBGROUP 
Actuarial Accrued Liability - July 1, 2014 
Total 32,876,352 35,383,419 217,548 5,578 - 68,482,897 
Actuarial Value of Plan Assets - July 1, 2014 0 0 0 0 0 0 
Unfunded Actuarial Accrued Liability 32,876,352 35,383,419 217,548 5,578 0 68,482,897 
Annual Required Contribution (ARC) for FYE 2015 
Normal Cost 918,060 1,134,451 16,624 3,979 0 2,073,114 
Amortization of UAL 1,828,495 1,967,933 12,099 310 0 3,808,837 
Interest 109,862 124,095 1,149 172 0 235,278 
Total 2,856,417 3,226,479 29,872 4,461 0 6,117,229 
Annual OPEB Cost for FYE 2015 
Annual Required Contribution 2,856,417 3,226,479 29,872 4,461 0 6,117,229 
Interest on Net OPEB Obligation 301,256 333,788 3,427 501 0 638,972 
Adjustment to annual required contribution (435,593) (482,632) (4,955) (725) 0 (923,905) 
Annual OPEB cost/(expense) 2,722,080 3,077,635 28,344 4,237 0 5,832,296 
Expected Employer premiums (1,043,752) (1,378,892) 0 0 0 (2,422,644) 
OPEB Trust contributions 0 0 0 0 0 0 
Employer contributions (including subsidy) (1,043,752) (1,378,892) 0 0 0 (2,422,644) 
Change in Net OPEB Obligation 1,678,328 1,698,743 28,344 4,237 0 3,409,652 
Net OPEB Obligation (Asset) - beginning of year 7,531,406 8,344,705 85,668 12,533 0 15,974,312 
Net OPEB Obligation (Asset) - end of year 9,209,734 10,043,448 114,012 16,770 0 19,383,964 
* The Net OPEB Obligation as of June 30, 2012 is allocated to each subgroup based on the Annual Required Contribution as of June 30, 2013. 
Page 29 
Town of Winthrop Postemployment Benefits Other Than Pensions
Actuarial Valuation as of July 1, 2013