FY 25 Harford County Government Proposed Operating Budget

COUNTY BUDGET POLICIES AND PROCESS

provide annual contributions sufficient to satisfy the actuarially determined contribution requirements. Additional periodic County contributions are determined by an actuarially determined rate. Since there are no “Salaries”, the rate cannot be expressed as a percentage of covered payrolls. There are no participant financed benefits in this plan. Administrative costs are financed through investment earnings. The plan generally provides $5,000 burial benefits and other benefits for disability. Regular benefits are calculated at $12 per month for each of the first 25 years of service, plus $6 per month for each year in excess of 25. The maximum benefit is $450 per month. Post Retirement Benefit Plans - The County offers post-retirement medical and life insurance benefits to Harford County retirees. These benefits are referred to as Other Post Employment Benefits (OPEB). During Fiscal Year 2008, the County established a trust to act as the funding mechanism for the OPEB Plan. Funding for retiree benefits is not required by law other than pay-as-you-go amounts necessary to provide current benefits. Contributions to the OPEB Trust Fund may be made annually as appropriated by the County Council. The County’s annual OPEB cost is actuarially determined in accordance with Governmental Accounting Standards Board (GASB) Statement 45. Plan benefits are accounted for on an accrual basis. Retirement Health Savings - The County offers a tax-exempt health reimbursement arrangement that Harford County set up in accordance with the Internal Revenue Code Section 501(c)(9). This is a defined contribution benefit. Employees hired on or after July 1, 2010 are enrolled in the Retirement Health Savings (RHS) in lieu of the traditional defined-benefit retiree healthcare program. The County will negotiate with Union representatives each year to determine the amount of money to be placed in RHS.. The Risk Management Office, a division of the Law Department pursuant to Executive Order 14-08, is responsible for the oversight of all risk management and countywide safety programs, in addition to managing property damage, vehicle damage, general liability, and workers' compensation claims. Harford County has been self insured for property damage, vehicle damage, general liability, auto liability, and workers' compensation claims since July 1, 1982. The Self Insurance Program, which is administered by the Risk Management Office and actuarially determined annually, is the monetary source by which all claims are paid. The financial welfare of the County is further protected by the purchase of excess property, vehicle, general liability, auto liability, and workers' compensation insurance policies, that can be triggered and the financial obligation is then transferred and paid by that entity. Harford County’s Accounting Policies Basic Financial Statements Government-Wide Financial Statements - The government-wide financial statements are designed to provide readers a broad overview of Harford County Government’s finances, in a manner similar to a private sector business. As a general rule, the effect of interfund activity is eliminated from these statements. Exceptions would include payments in lieu of taxes and other charges between the water and sewer function and various other functions of the government. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Self Insurance and Risk Management

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