Retiree HRA VEBA - Post Tax Dollars and Purely Voluntary EE Contributions

I'm fairly new to the world of VEBA, but my understanding has always been that in order to have an HRA, there can be no employee contributions. Since a VEBA is just the funding vehicle, how can an association have a post-retirement HRA that is funded by voluntary post-tax employee contributions with a small employer match? I have an IRS approval letter for the VEBA where the plan accurately described itself as voluntary post-tax with a death benefit, but I'm perplexed as to how/why the IRS granted approval to begin with. What am I missing?

Perhaps, the distinction is that pre-tax employee contributions are not permitted in conjunction with an HRA. I realize this is not applicable in case of retirees, but who knows what IRS is thinking!

What you are missing is IRS Private Letter Ruling 200802003 that addresses mandatory pre-tax employee contributions to an HRA.

Good catch MRestum - Only mandatory employer contributions, mandatory employee contributions, and mandatory contributions of accumulated leave are made to Plan. The Plan provides that “mandatory employee contributions (i.e. mandatory salary reduction contributions and mandatory contributions of accumulated sick leave, vacation, and severance) which are not actually or constructively received by the Participant will be considered Employer Contributions for purposes of the Plan.” The Plan also provides that “no contributions other than Employer Contributions are required nor will they be accepted.” Contributions are made during an employee’s active employment with Taxpayer.

Note that the PLR was issued to a municipality - and remember the general rules about PLR guidance. 

HRAs are always notational, unfunded accounts. 

Where there is actual funding to a VEBA by employers AND employees, IRC 419 and 419A may apply to limit contributions. 

VEBAs have separate rules where the VEBA is limited only to employee after-tax contributions, or where there are represented employees. 

You described this as "IRS approval letter for the VEBA where the plan accurately described itself as voluntary post-tax with a death benefit".  So, perhaps the VEBA only accepts employee after-tax contributions, and the employer"match" is an unfunded, notational, HRA?