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CITY OF SANTA ANA— Pension/OPEB Analysis & Financing Solutions OPEB • Debt Service on existing bonds • Capital Improvement Plan (CIP) • Projected Salary and Rate Increases We will commence the analytical by work building a customized pension model that Incorporates the City'$ current Amortization Bases: 18 Miscellaneous Plan& 17 Safety Plan, The model corresponds solely to the UAL for the 110 Tier "Classic." plan —since the predominant portion of the UAL is concentrated in the 1" Tier. The City's FY 19.20 UAL for the I" Tier Plans are equal to $635 million: • $275 million for Miscellaneous Plan —18 Amortizatlon Bases • $360 million Safety Plan-17 Amortization bases UFI will create an amortization schedule for each Amortization Base for each plan. These schedules serve as the foundation of the pension model, which enables the City to perform scenario analysis and determine the optimal solution for the use of Additional Discretionary Payments (ADPs) to COWERS, We will incorporate 3 funding solutions In the pension/OPEB model: 1) synthetic/soft fresh start, 2) tax-exempt exchange, and 3) Pension Obligation Bonds (POBs). This Information will serve as the baseline for the scenario analysis phase of the engagement. OPEB U,pfuffr(gra9yFfuad iabilily The city has an unfunded Ilablllty of $635 million — 69% The Clty's annual UAL payments are scheduled to Increase from $44 million In FY 19-20to $65 million In F120$0-al. These Payments are In addition, to the OtVs Normal costs, which are based an a percentage of payroll =19%(Mlac.) & 23% (Safety). The City only pays the PEMCHA minimum, currently $133 per month to is retirees as a retiree medical benefit, which significantly reduces the City's OPEB liability. Nonetheless, the City has 481 retirees and 502 active employees who are eligible forthis benefit, resulting In a $54.6 million OPEB liability, We will incorporate the projected "pay -go" retiree medical premiums into our financial retirement costs projections. Moreover, we will work with the City to identify potential OPEBfundingstrategies, Our projections will take Into account all of the City's significant financial obligations, collectively. We can integrate the cash flows from our pension/OPEB models Into your existing forecasting/rate model or help you to refine or develop a long-term financial planning model. Once the model is developed and data is analyzed, we will hold an In -person meeting to present basic findings and discuss potential financial solutions to City staff, After our initial meeting with City staff, using data outputs from the customized pension model to analyze the Impact of different options to address these liabilities, we seek to obtain feedback regarding the most viable financial solutions, UPI will refine these financial solutions, perform scenario analyses, and develop specific recommendations, We will present Our recommendations In a PowerPoint presentation to the (UUF I