1. Retiree Healthcare Benefits January 4, 2012 Michael E. Finn, CFO

2. Phase out over the next two years – Transition existing retirees to ASRS ASRS currently utilizes UHC network Financial impact – Employees who retire before June 30, 2013 would still be able to retire with full benefits if criteria set forth in Governing Board Policy is met Retiree Healthcare Benefits

3. Grandfathered Recommendation – 75% offset to those with 25 years or more of continuous service prior to June 30, 2014 – 50% offset to those with 25 years or more of continuous service prior to June 30, 2015 – 25% offset to those with 25 years of continuous service prior to June 30, 2016 3 Recommended Transition Option

4. 4 Current Employee Years of Service

5. 5 Existing Retiree Demographics

6. 6 Current and Future Point Projections

7. 7 Demographics of 2013 Projected Retirees

8. 8 Retiree Medical Benefits Cash Flow Projections (As Presented in Study Session) **Assumes all eligible employees retire to ensure coverage**

9. DISCUSSION AND QUESTIONS