October 28, 2008

Get the GASB 45 details Wednesday

A newly created panel may find a way to tap the city’s flush pension accounts to get some cash to cover costly health care for retired municipal workers.
If the new GASB 45 Committee, named for an accounting rule, determines that it can tap the money, taxpayers could save more than $1 million annually, officials said.
The first meeting of the new committee is slated for 5 p.m. Wednesday in the City Council chambers at City Hall.
Mayor Art Ward said he’s eager to have the issue explored thoroughly to determine if savings are possible for taxpayers.
The 13-person panel includes Comptroller Glenn Klocko, city Councilors Ken Cockayne and Cliff Block, city attorney Dale Clift and the presidents of each of the city’s unions.
Klocko said the initial session will devote an hour to explaining the issue in some depth to members and others who are interested in the subject.
He said that a PowerPoint slide show will cover the reason the city has to have a plan for tackling the costly post-employment benefits that workers receive in addition to their pensions, the legal rules governing the use of pension money and the actuarial figures involved.
“We’re going to show them the facts and figures,” Klocko said.
Klocko said once the committee has the information, its members will discuss what should be done, if anything.If a recommendation to pursue the idea is adopted, city councilors would have to give their approval, he said.
Those pushing the concept, including Cockayne, have long argued that taking some of the surplus cash in the city’s overfunded pension accounts and putting it a new trust for health care for retired workers would help everyone.
The city has a long-term plan to use tax money to fill the new health care fund, but doing it will require ever increasing funds to meet the demand and get ahead of the costs.
The city’s unions have been at best skeptical of the idea, claiming it risks losing pension money that may well be needed. They also say the city should negotiate any change with them.
Klocko said he hopes the information gathered by his office, the city’s pension lawyer and actuarial experts will aid in understanding the issue.
“We’re going to clear the misconceptions up,” he said.
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Copyright 2008. All rights reserved.
Contact Steve Collins at scollins@bristolpress.com

12 comments:

Anonymous said...

My concern is with regard to what has happened to the stock market. It has lost trillions of dollars since the slide started. Let's not forget that those funds have been hit just as hard as everyone elses. I don't think it's something that should be touched and what has happened to the market is a good example of why it should be left alone. We want to make sure that those funds are there for the employees to use when it comes time for their retirement especially with the concern that Social Security may not be around in the future.

I also believe that tapping into this fund is like our so called "temporary income tax." Wiecker pushed hard for the income tax saying it was only going to be temporary. Here we are 17 years later and the amount we have to pay will be going up! So much for temporary!

Once we raid this fund, we won't be able to stop. The amount we take will increase and increase just like what the state did to the teacher's retirement fund. This committee had better think long and hard about what it is doing.

Mark my words, this is a bad thing for the reasons I have stated and probably other reasons that I haven't considered.

Anonymous said...

Steve,
In the yesterday's article on the two important meetings, you state that Klocko said that the funds were "down a bit." Apparently his head is in the sand, because I'm sure "down a bit" is an understatement! Has he looked at his retirement statement lately? I'm sure the pension fund has been socked good and hard! Here we go again with a management guy trying to hurt the union employees. I'm sure he'd be shouting good and loud if anyone thought about touching his pension.

I also heard a rumor that this clown would like to be the COO if it passes. It must be Halloween, because I'm scared out of my wits to think that could possibly come to pass!

Steve Collins said...

In all honesty, I have no idea if the city's pension funds are down 5 percent, 10 percent or 20 percent. I'm sure they're down.
But they are so flush that it would be shocking at this point if they weren't still overfunded by a wide margin, despite the stock market drop.
We'll know much more tonight, of course, but the logic of keeping the money there as opposed to a different trust fund that benefits the same people doesn't fly. No matter which fund the cash is invested in, taxpayers are on the hook if there's a shortage. There's no way around that.
The only issue is whether it makes sense to tax people more to fill the health benefits trust if there's already money available to cover the tab in an overfunded pension trust fund. And that depends on the legal technicalities and the actuarial data. We should know later today whether that information shows that it's worth trying to do this or not.

Anonymous said...

Steve, one bit of analysis that you did not include:
If the retiremnent fund goes down to a point where contributions are needed, the city can revert back to the old way where both the city and the bargaining unit contributed. Not so with benefits.

Also, if benefits are flush and have no immediate impact on the budget, how long will it be before they are increased, above the @50% level that currently exists?

Anonymous said...

I just hear that Craig Minor stated after the conclusion of this meeting that he was interested in the applying for the C.O.O. position when it passes. Not to fast Craig, the election hasn't taken place yet.

Craig Minor said...

If you heard me say that, you were listening to the tail end of a tongue-in-cheek conversation between me and a friend of many years. I have said it before and I will probably have to say it again: no one in Bristol is qualified to be the COO. The charter requires the COO to have a BA (preferably MA) in government/public administration/business/related field AND at least four years as a COO or Town Manager or EQUIVALENT position. That disqualifies everyone who is currently working for the City and every current, former, or wannabe politician that I know of.

Anonymous said...

Minor

Who are you to say who is or is not qualified for ANY position?

Why don't you go back to where you come from you are a one time jerk. (you sure look like it at the council meetings)

Anonymous said...

talk about a couple of pompous, arrogant dorks - minor has the nerve to say that no one in bristol, including wanna-bees, is qualified to be a COO? then I would say that the position isn't needed because it won't be anyone who can relate to people at all - like minor.
Minor should be thinking about doing Bristol a favor and moving his butt to cromwell where he probably has them buffaloed.
Cockayne tries to talk like he has a clue but proves to be nothing short of a boisterous bully, ignorant enough to think that his (1) year of political experience makes him a guru when he really has become the embarrassment of bristol politics.
The shrew of the group of social and political bigots is ken johnson, whose basis for pushing the COO idea is that he couldn't win his own election for mayor because of his own incompetence, sleeziness and continued duping of the public (municipal energy sham. This person tries to hide from the public until he thinks that he can leap onto an opportunity to help himself, regardless of the cost or detriment to the city of bristol.
He should trade in those orange shirts for bright red ones in order to blend in with the red face of embarrassment that he is becoming to this city.

Anonymous said...

Cockayne and Klocko: they deserve each other.

Anonymous said...

We still haven't got all the details, all the information necessary to make the right decision.

Odin said...

"We still haven't got all the details, all the information necessary to make the right decision."

You apparently have commitment issues. If you can't make a decision with limited facts, stay home. Stay in bed where it's safe. Don't vote for McCain or Obama either, since you don't really know enough about either of them to know who would make the better President.

Anonymous said...

ODIN,

And you make decisions without all the necessary information?

I hope you are not making any that affect me!!!