The City of Galt Adopts the PARS OPEB Trust: “A Superior Solution.”Categories: Hot Sheets,OPEB/GASB 45/75
As other post-employment benefits (OPEB) liabilities keep piling up, public administrators are grasping for solutions. Many California agencies have taken action by joining the PARS OPEB Trust. Even if budgets are tight, it makes good sense to make partial contributions to lower unfunded liabilities.
In 2012, the City of Galt’s Council directed staff to research firms that provide OPEB trust services for its post-employment health care benefits. Upon completion of their research, the staff recommended PARS to the City Council to handle the City’s OPEB trust needs.
Mike Sylvia, Deputy Finance Director for the City of Galt, comments, “PARS provides a flexible plan that can be tailored to the City’s needs. PARS has multiple trust investment options, does not require a mandated trust term, and the required actuarial valuations are every three years.” He continues, “PARS’ numerous investment options allow the City to structure the investments to meet the plan’s goals. PARS also has an approval (letter) ruling from the IRS, confirming its tax-exempt status.”
UNIQUE FEATURES OF THE PARS OPEB TRUST
These are unique features of the PARS program that differentiate us from our competitors:
- The Program is designed and administered by an experienced OPEB trust administrator, PARS, with 30 years of experience overall and 17 years in OPEB trust administration
- A strong, nationally chartered trustee – U.S. Bank – 5th largest commercial bank and highest rated in the nation
- IRS approval of PARS’ Trust on a multiple-employer basis as a tax-exempt pre-funding vehicle; the agency does not need to incur additional legal costs to form their own
- Complete customization of investments available using an open architecture platform
- Alternative directed trustee approach if agency wants to use its own investment manager/advisor
- Local control – agencies maintain control
- No mandates related to actuarial methods and timing
- Ready-to-use, simply organized multiple-employer trust; proven trust structure that works
- Account can be set-up within one week
- Legal counsel for PARS and numerous public agencies have carefully vetted all legal documents associated with the PARS OPEB Trust
- Economies of scale for investments and administration as the Trust continues to grow rapidly in participants and assets
- Personal service – a Senior Consultant from PARS and a Senior Portfolio Manager from HighMark are dedicated to serving your agency
The PARS Advantage
For 30 years, PARS has designed and delivered hundreds of individualized solutions that have saved more than 600 public agencies many millions of dollars. Our success can be attributed to our unique approach:
We craft customized, mutually-beneficial retirement solutions for agencies and their workforce
We guide agencies through the process, showing them how to achieve bottom-line results
We help to define the goals and objectives for each agency
Join the City of Galt in pre-funding your agency’s OPEB obligation. By doing so you will lower your agency’s unfunded retiree health care liability and affect the bottom line in a positive way for years to come.