March 24, 2007

UNfunded liabilities $205,000 per employee in one district!!

Again the you know what has not yet hit the fan... Wait until the all the government entities have to comply within the next four years with a new accounting standard of the Governmental Accounting Standards Board Statement, aka GASB 45...The taxpayers are going to get a serious prostate exam...
CBS 5 - San Francisco,CA,USA

A Marin County grand jury this week said the county has a long-term health care liability of $378 million because of health care payments to retired employees.

The county likely won't be able to make the payments without raising taxes or cutting services, the jury found.

The civil grand jury questioned whether the health care benefits for retirees are vested and can't be taken away, or whether they are subject to change or elimination.

The panel also asked whether managers and elected officials who are eligible for retiree health care benefits are in a conflict of interest position when making decisions about those benefits.

The $378 million liability "is only a little less than the county's entire 2007 annual budget of $400 million, the grand jurors said.

Towns, cities, special districts and school districts are expected to report their un-funded liabilities, including present and future costs of pensions and retiree health care benefits, within the next four years under a new accounting standard of the Governmental Accounting Standards Board Statement 45, GASB 45, the panel noted.

"They (the unfunded liabilities) will be substantial,'' the panel reported. "One of 36 special districts, for example, estimated its liability in 2005 at around $8.6 million, or $205,000 per employee.''

The panel recommended the county, towns, cities and special districts determine whether the benefits are vested and inform employees of their findings.

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