By Nels Johnson, Marin Independent Journal -
The county is doing better than most other Marin agencies in dealing with the spiraling tab for retiree health care, but the civil grand jury says it should be doing more, and pension critics agree.
Citizens for Sustainable Pension Plans urged county supervisors this week to tighten their fiscal grip on retiree health costs as advocated by the jury, but the county board agreed officials already are doing plenty to rein in what critic Jody Morales called a "Cadillac" health care plan.
With a minor addition, supervisors approved the administration's response to the jury's hard-hitting examination of Marin's retiree health care costs.
Speakers for the sustainable pension group contended current employees should share costs and should be required to work longer by "extending the age for benefits to commence." But county officials disagree, saying higher retirement ages "will not be implemented" and that changing cost programs for current employees requires analysis — and is a matter for the bargaining table.
"We agree with the grand jury that retiree health is a significant issue that needs to be addressed by nearly all public agencies," County Administrator Matthew Hymel said. "We have been aggressive in our efforts to reduce our long-term liabilities."
He noted the county adopted a lower-cost health plan for employees hired after 2008, contributed $26 million to a retiree health trust this year, will chip in $12.5 million next year, and intends to pay off unfunded liabilities over the next 30 years. Critics say a shorter payoff period should be required.
The only jury finding that both the supervisors and the critics agreed on was that local agencies "promising relatively generous benefits should provide clear justifications" to taxpayers. That's because retiree benefits vary widely, and the unfunded tab exceeds $522 million, posing a fiscal calamity for future taxpayers, the grand jury said.
Jurors said that in effect, the average household across all Marin cities owes about $5,700 to pay for retiree health care promised employees but left unfunded by elected officials. The liability at the county Civic Center was "$293 million or about $2,627 per county household," jurors added. Unfunded liability calculations range from highs of $7,982 per household in Mill Valley, $7,365 in Ross, and $7,127 in Corte Madera, to lows of $4,044 in Novato and $4,410 in Fairfax. Others include $4,484 in San Anselmo and $4,900 in San Rafael, as well as Belvedere, $5,184; Sausalito, $5,270; Larkspur, $5,374 and Tiburon, $5,500.
Barring action soon, "each Marin County household will be assessed significant additional taxes or will see a dramatic reduction in services," the grand jury warned.
The jury found that 26 agencies have set aside no funding at all for future health benefits — and only 12 have set aside more than 5 percent of the cost.
The jury noted the county pays $12 million a year to pay for health benefits for 1,400 retirees, or about $8,600 per year per retiree. In 2008, officials capped costs at $3,000 for new employees. But the jury found that county supervisors have funded only 8.2 percent of a $319 million tab for the retiree health benefits they have promised.
"The county's retiree health care liability is 92 percent unfunded," the jury reported. "In contrast, its pension liability is about 25 percent unfunded."
San Rafael has paid for 30.9 percent of its $35.2 million retiree health liability. Other agencies that have paid down or set aside some funding for future health benefits, with liabilities followed by the percent they have been funded, include: Tiburon Fire Protection District, $3.1 million, 26.7 percent; Fairfax, $1.28 million, 19.8 percent; Marin Municipal Water District, $44.77 million, 19.4 percent; Tamalpais High School District, $6.54 million, 19.3 percent; Central Marin Sanitation Agency, $3.55 million, 19.1 percent; Kentfield Fire Protection District, $2.39 million, 16.2 percent; Mill Valley, $28.1 million, 12.9 percent; Las Gallinas Valley Sanitary District, $2.15 million, 12.5 percent; Ross Valley Fire Department, $5.12 million, 6.1 percent; Novato Fire District, $17.71 million, 5.4 percent; Southern Marin Fire Protection District, $5.49 million, 3.6 percent, and Corte Madera, $11.83 million, 0.3 percent.
At $12.03 million, the tiny Marin Sonoma Mosquito and Vector Control District posted the highest unfunded health liability among those with no payment program.
The Marinwood Community Services District, where veteran employees may retire at 50 after only five years of service, a generous benefit "unique among the entities the grand jury studied," no provision has been made for funding a $4.74 million liability. The Marinwood district alone has generated unfunded liability per household of about $2,750 or "four times that of any other special district the grand jury surveyed." When health liabilities of other agencies serving Marinwood are counted, the household tab is $6,195.
Agencies under a wave of red ink include San Rafael city schools, which have set aside no funding despite a $10.4 million liability. Liabilities of other agencies with no payment plan include:
Larkspur, $7.49 million; Twin Cities Police Authority, $7.49 million; Sausalito, $6.63 million; Novato Sanitary District, $6.11 million; Sewerage Agency of Southern Marin, $4.11 million; North Marin Water District, $3.07 million; Reed Union School District, $3.04 million; Tiburon, $2.9 million; Mill Valley School District, $2.16 million; Ross School District, $2.14 million; San Anselmo, $1.94 million; Ross Valley School District, $1.84 million; Novato, $1.8 million; Shoreline School District, $1.8 million; Kentfield School District, $1.43 million; Dixie School District, $1.06 million; and Novato School District, $820,000.
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