Page 101 - Moreno Valley 2025 Annual Financial Report

City of Moreno Valley, California

Notes to Financial Statements
For the Year Ended June 30, 2025

Note 9. Other Post Employment Benefits (OPEB) (Continued)

Sensitivity of the net OPEB liability to changes in the discount rate

The net OPEB liability of the City, as well as what the City’s net OPEB liability would be if it were
calculated using a discount rate that is one percentage point lower 5.40% or one percentage
point higher 7.40% follows:

1% Decrease Discount Rate 1% Increase
5.40% 6.40% 7.40%
Net OPEB Liability (Asset) $ 1,059,679 $ (853,300) $ (2,489,085)

Sensitivity of the net OPEB liability to changes in the healthcare cost trend rates

The net OPEB liability of the City, as well as what the City’s net OPEB liability would be if it were
calculated using healthcare cost trend rates that are one percentage point lower 5.80% or one
percentage point higher 7.80% than current healthcare cost trend rates follows:

1% Decrease Trend Rate 1% Increase
5.80% 6.80% 7.80%
Net OPEB Liability (Asset) $ (1,191,079) $ (853,300) $ (483,782)

OPEB Expense and Deferred Inflows and Outflows of Resources Related to OPEB

For the year ended June 30, 2025, the City recognized an OPEB expense of $515,736. At
June 30, 2025, the City reported deferred outflows of resources and deferred inflows of
resources related to OPEB from the following sources:

Deferred Outflows Deferred Inflows
of Resources of Resources
Differences Between Expected and Actual Experience $ 85,676 $ (1,344,389)
Changes of Assumptions 480,200 (1,686,589)
Net Difference Between Projected and Actual Earnings
on Plan Investments - (45,948)
Contributions Subsequent to the Measurement Date (1) 1,406,963 -
$ 1,972,839 $ (3,076,926)
(1) Contributions made after the measurement date will be recognized as a reduction of the net OPEB liability or collective net
OPEB liability in the following fiscal period, rather than in the current period.

Amounts reported as deferred outflows of resources and deferred inflows of resources related
to OPEB will be recognized in OPEB expense as follows:

Fiscal Year Ending
June 30
2026 $ (390,794)
2027 (159,365)
2028 (784,941)
2029 (527,449)
2030 (223,624)
Remaining (424,877)

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