Unfunded Retiree Medical Benefit Liabilities
Original post made by Stacey, Amberwood/Wood Meadows, on May 20, 2009
"An even bigger headache is a new requirement that state and local governments identify and quantify their obligations for providing health care to their retired employees. The state auditor's office and an advisory commission told the state two years ago that its unfunded liability for health care is $48 billion. "
PUSD has zero dollars devoted to this. That means when they have to start quantifying their obligation on the books, their credit rating could go down.
"The state auditor's office says in a new report that $4.71 billion would be needed in 2009-10 â€” this year's unfunded deficit, next year's current costs and next year's share of the unfunded amount. It's like a high-interest credit card debt that continues to grow when a cardholder makes only minimum payments.
Those numbers don't count future health care costs for University of California or court system retirees, estimated at $13 billion. Nor do they include retirees from local school districts and local governments, another $58.7 billion. "