Acton-Boxborough Regional School District Notes to Basic Financial Statements Year Ended June 30, 2024
Significant Actuarial Assumptions
The total other postemployment benefit liability in the July 1, 2023, actuarial valuation was determined using the following actuarial assumptions, applied to all periods in the measurement that was rolled forward to June 30, 2024:
Valuation date………………… July 1, 2023
Actuarial cost method………… Individual Entry Age Normal
Asset valuation method………… Fair value of assets as of reporting date, June 30, 2024
Investment rate of return……… 6.89%, net of OPEB plan investment expense, including inflation.
Municipal bond rate…………… 4.21% as of June 30, 2024 (source: S&P Municipal Bond 20-Year High Grade Index - SAPIHG)
Single equivalent discount rate… 6.55%, net of OPEB plan investment expense, including inflation, previously 5.92%
Inflation rate…………………… 2.50% as of June 30, 2024 and for future periods
Projected salary increases……… 3.00% annually as of June 30, 2024 and for future periods
Pre-retirment mortality………… General: RP-2014 Mortality Table for Blue Collar Employees projected generationally with scale MP-2016 for males and females, set forward 1 year for females Teachers: RP-2014 Mortality Table for White Collar Employees projected generationally with scale MP-2016 for males and females Post-retirement mortality……… General: RP-2014 Mortality Table for Blue Collar Healthy Annuitants projected generationally with scale MP-2016 for males and females, set forward 1 year for females Teachers: RP-2014 Mortality Table for White Collar Healthy Annuitants projected generationally with scale MP-2016 for males and females Disabled mortality……………… General: RP-2014 Mortality Table for Blue Collar Healthy Annuitants projected generationally with scale MP-2016 for males and females, set forward 1 year Teachers: RP-2014 Mortality Table for White Collar Healthy Annuitants projected generationally with scale MP-2016 for males and females Investment policy The OPEB plan’s assets are managed on a total return basis with a long-term objective of achieving and maintaining a fully funded status for the benefits provided through the OPEB plan. The long-term real rate of return on OPEB investments was determined using the District’s investment policy. 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 of returns (expected returns, net of OPEB
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