Note 12. Federal Employee Benefits
These liabilities consist of:
Federal Employee Benefits Liabilities
(In Thousands)
|
FY 2005 |
FY 2004 |
Actuarial FECA Liability |
$173,414 |
$179,179 |
NOAA Corps Retirement System Liability |
350,300 |
335,700 |
NOAA Corps Post-retirement Health Benefits Liability |
45,400
|
42,800
|
Total |
$569,114
|
$557,679
|
Actuarial FECA Liability:
Actuarial FECA liability is calculated annually, as of September 30. For discounting projected annual future benefit payments to present value, the interest rate assumptions used by DOL were as follows:
Interest Rate Assumptions
|
FY 2005 |
FY 2004 |
Year 1 |
4.528% |
4.88% |
Year 2 and Thereafter |
5.020% |
5.24% |
The wage inflation factors (Cost of Living Allowance) and medical inflation factors (Consumer Price Index - Medical) applied to the calculation of projected future benefits, and also used to adjust the methodology’s historical payments to current year constant dollars, were as follows:
Wage and Medical Inflation Factors
FY 2005
Fiscal Year |
Cost of Living Allowance |
Consumer Price Index - Medical |
2006 |
3.33% |
4.09% |
2007 |
2.93% |
4.01% |
2008 |
2.40% |
4.01% |
2009 and Thereafter |
2.40% |
4.01% |
Wage and Medical Inflation Factors
FY 2004
Fiscal Year |
Cost of Living Allowance |
Consumer Price Index - Medical |
2005 |
2.03% |
4.14% |
2006 |
2.73% |
3.96% |
2007 |
2.40% |
3.98% |
2008 |
2.40% |
3.99% |
2009 and Thereafter |
2.40% |
4.02% |
NOAA Corps Retirement System Liability:
This liability represents the unfunded actuarial present value of projected plan benefits. The actuarial calculation is performed annually, as of September 30. The actuarial calculations used the following U.S. Department of Defense Retirement Board economic assumptions:
U.S. Department of Defense Retirement Board Economic Assumptions
|
FY 2005 |
FY 2004 |
Investment Earnings on Federal Securities |
6.25% |
6.25% |
Annual Basic Pay Increases |
3.75% |
3.75% |
Annual Inflation |
3.00% |
3.00% |
The related pension costs included in the Consolidated Statements of Net Cost are as follows:
Related Pension Costs
(In Thousands)
|
FY 2005 |
FY 2004 |
Normal Cost |
$ 5,600 |
$ 4,900 |
Interest on the Unfunded Liability |
20,500 |
19,900 |
Actuarial (Gains) Losses, Net |
4,900
|
(100)
|
Total Pension Costs |
$31,000
|
$24,700
|
NOAA Corps Post-retirement Health Benefits Liability:
This liability represents the unfunded actuarial present value of projected post-retirement plan benefits. The actuarial calculation is performed annually, as of September 30. The actuarial calculations used the same U.S. Department of Defense Retirement Board economic assumptions as used for the NOAA Corps Retirement System actuarial calculations. The claims costs used to derive the post-retirement liabilities were taken from the analysis of the U.S. Military’s Projected Retiree Medical Liabilities reports for FY 2005 and FY 2004.
The related post-retirement health benefits costs included in the Consolidated Statements of Net Cost are as follows:
Related Post-Retirement Health Benefits Costs
(In Thousands)
|
FY 2005 |
FY 2004 |
Normal Cost |
$2,900 |
$3,200 |
Interest on the Unfunded Liability |
2,700 |
2,500 |
Actuarial (Gains) Losses, Net |
(1,700)
|
(1,900)
|
Total Post-retirement Health Benefits Costs |
$3,900
|
$3,800
|
|