Large User True-up Analysis City of Hollywood Large User True-up Analysis GASB 68 Discussion February 22, 2017

In our last meeting… Large Users asked for detailed presentation of the summary results of the two methods presented for addressing GASB 68. Those methods were: Pension Expense Method Pension Expense would be used each year, and Large Users would also pay their share of the Net Pension Liability (~$11 million) Pension Contribution Method Pension Contribution would be used each year After the last meeting, a detailed presentation of the calculations which underpinned those summary results was provided to the Large Users for review

Comparison of Pension Contribution vs Pension Expense – by Acct Number Account Number Pension Contribution - Fund 42 Pension Expense – Fund 42 (see note 1) Difference in Costs between Using Pension Contribution vs. Pension Expense Treasury - Utility Billing & Collections Utility Administration Engineering Support Water Treatment Plant Water Distribution Wastewater Treatment Plant Sewer Collection Total 42.4001.00000.536.00 $ 397,084 $ 260,710 $ 136,374   $ 136,374 42.4001.00732.536.00 210,917 175,847 35,070 42.4001.00783.536.00 221,016 149,953 71,063 42.4003.00000.536.00 450,007 271,427 178,580 42.4004.00000.536.00 646,724 336,631 310,093 42.4011.00000.536.00 496,080 251,800 244,280 42.4011.00762.536.00 209,117 103,853 105,264 42.4011.00765.536.00 74,647 37,789 36,858 42.4012.00772.536.00 960,037 526,719 433,318 42.4012.00773.536.00 310,413 203,820 106,593 42.4041.00000.536.00 672,998 391,256 281,742 42.4041.00782.536.00 375,710 190,497 185,213 42.4041.00784.536.00 164,543 114,789 49,754 42.4041.00785.536.00 196,342 131,712 64,630 42.4041.00786.536.00 70,497 - $ 5,456,132 $ 3,146,804 $ 2,309,328 $ 178,580 $ 171,443 $ 310,093 $ 386,402 $ 433,318 $ 722,899 $ 106,593 (1) In addition to the $3,146,804 for Pension Expense, the Large Users would also be liable for their allocated share of the Net Pension Liability.

Allocation of Difference to Large Users Diff. in Pers. Services Costs $2,309,328 Allocated to Water $ 1,120,472 Allocated to Sewer $ 1,188,856 Sewer Portion to Hollywood $603,725 Sewer Portion to Large Users $585,131 Adj. for: Gen. Admin. ($ 4,021) 10% RRI $58,111 Sewer Portion to Large Users $639,221 (as presented in cover letter and backup provided to LU’s)

Summary For FY 2015 True-up: LU Cost Share - Pension Expense Method: Based on Pension Expenses for FY 2015 (paid already), and Net Pension Liability (~$11 million), or amortization of the ~$11 million (not yet paid) LU Cost Share - Pension Contribution Method: Based on Pension Contributions for FY 2015 Additional $639,221 for FY 2015