State and local governments often back-load employee compensation into retirement by promising generous retirement benefits. However, many governments have failed to set aside money to pay for these benefits. While pensions have received the lion’s share of public attention, the Federal Reserve estimates that the long-term liability for providing health-care coverage for retired public workers is over $1 trillion. These rising costs constrain governments’ ability to address pressing problems and have helped drive a few cities into bankruptcy. Read Full Article »
North Carolina's Experiment: Defusing the State Debt Bomb
A de
cade after the Great Recession, state and local governments still face barriers to providing their citizens with ample services. Among the larger fiscal challenges is Other Post-Employment Benefits (OPEB) for public employees. The costs of these programs have been rising, which constrains spending on other priorities.
State and local governments often back-load employee compensation into retirement by promising generous retirement benefits. However, many governments have failed to set aside money to pay for these benefits. While pensions have received the lion’s share of public attention, the Federal Reserve estimates that the long-term liability for providing health-care coverage for retired public workers is over $1 trillion. These rising costs constrain governments’ ability to address pressing problems and have helped drive a few cities into bankruptcy. Read Full Article »
State and local governments often back-load employee compensation into retirement by promising generous retirement benefits. However, many governments have failed to set aside money to pay for these benefits. While pensions have received the lion’s share of public attention, the Federal Reserve estimates that the long-term liability for providing health-care coverage for retired public workers is over $1 trillion. These rising costs constrain governments’ ability to address pressing problems and have helped drive a few cities into bankruptcy. Read Full Article »
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