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Auditor: San Benito’s retiree‑health trust up to roughly $36M; ADC for 2026–27 about $1.1M
Summary
Auditor‑Controller Joe Paul Gonzalez told supervisors the county’s irrevocable OPEB trust has grown to about $36 million and reported a FY26‑27 actuarily determined contribution near $1.1 million, urging continued funding of the ADC and careful treatment of cafeteria plan changes that alter liabilities.
Auditor‑Controller Joe Paul Gonzalez told the board the county’s OPEB (other post‑employment benefits) valuation used for budgeting is dated June 30, 2024, and that the trust’s market value had grown to roughly $36 million as of March 31, 2026.
Gonzalez explained the accounting framework (GASB 74 and 75) that requires biannual actuarial valuations, the role of the irrevocable IRC §115 trust the board established in 2009, and how employer cafeteria‑plan contribution increases would change the county’s net OPEB liability and require an updated actuarial evaluation.
He cited the actuarily determined contribution (ADC) for fiscal year 2026–27 at about $1.1 million and noted roughly half of that amount is a general‑fund obligation while the remainder is paid by other funds. He also highlighted annual benefit payments being drawn from the trust and the trust’s investment allocation (a mix of equities and fixed income) and recommended the board continue the existing policy of fully funding the ADC for budget stability and favorable financial‑statement treatment.
Supervisors asked whether the board could pause or reduce the ADC in the short term to relieve near‑term pressure; Gonzalez said changing ADC policy is a board decision but warned it affects accounting discount rates and external perceptions of fiscal management. He also explained legal limits on using irrevocable trust assets and the differences between pension funding and retiree‑health funding.
What it means: The trust’s current balance provides cushion for retiree health obligations, but the ADC and policy choices materially affect the county’s OPEB liability on the balance sheet. Any board decision to alter contributions will require actuarial recalculation and carry financial‑reporting implications.
