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<br />CITY OF LA PORTE, TEXAS <br />Notes to the Financial Statements <br />September 30, 2008 <br /> <br />10. Post-Employment Benefits - Continued <br /> <br />The ARC is made up of two components-the Normal Cost and the Amortization Amount. The normal cost, <br />which is the present value of the benefits deemed to accrue in the plan year, is $1 million. The amortized <br />amount, which is the present value of the accrued benefit, is $1.2 million. The amortized amount has been <br />calculated by level percent of payroll contributions. The amortized amount is required to fully amortize the <br />unfunded actuarial accrued liabilities over a 30 year period assuming payroll growth of 3%. <br /> <br />The City's annual employer contributions each year will continue to equal the benefits that are paid on <br />behalf of the retirees. The City will reflect proper treatment and note disclosure of Health Care Benefits for <br />Retired Employees in accordance with GASB No. 45 beginning with the fiscal year ending September 30, <br />2009. <br /> <br />11. Deficit Fund Balance <br /> <br />The Tax Increment Reinvestment Zone One (TIRZ) Fund has a deficit fund balance of $293,847, as of <br />September 30, 2008. This deficit is the result of the TIRZ borrowing money from a capital projects fund to <br />finance capital improvements. This deficit fund balance will be covered with future property tax revenues. <br /> <br />73 <br />