Government Retiree Costs to Be Put in the Spotlight – finally‼️ It’s time for taxpayers to pay attention 😡

Do you pay taxes in your state? If so, you should pay attention to the following; a requirement long overdue. Nearly a half a trillion dollars is a lot of money even for government. 

The next time you are inclined to blast a governor (probably Republican) for trying to fix this, keep the numbers and how they will be paid for in mind. The next time your governor stands along side public employee unions to preserve all this (probably Democrat), ask how it will be paid for. And no, even the wealthy can’t cover all this through higher taxes. 

Also, you might want to check how well funded your own pension is. What’s that? You don’t have a pension … no kidding. Do you get what’s going on yet⁉️😡

State and local governments will have to add hundreds of billions of dollars in retiree obligations to their books under rules enacted Tuesday that spotlight the growing costs of health insurance and other benefits owed to former municipal employees.

The new rules approved unanimously by the Governmental Accounting Standards Board, which sets accounting rules for states and municipalities, will require governments to carry their unfunded retiree-benefit obligations on their balance sheets—thus making their overall financial position look worse. Currently, governments are required only to disclose the benefit costs in the footnotes to their financial statements.

In addition, governments will have to use more conservative interest-rate assumptions in calculating the value of benefit obligations that they haven’t funded. That could increase the current value of the obligations, thus worsening the plans’ funding shortfalls.

The changes are in­tended to pro­vide more in­for­ma­tion to tax­pay­ers, pol­icy mak­ers and mu­nic­i­pal-bond an­a­lysts, GASB Chair­man David Vaudt said in a state­ment. The rules won’t re­quire gov­ern­ments to com­mit more money to pay for re­tiree ben­e­fits, nor do they re­quire any changes in the level of ben­e­fits pro­vided to re­tirees. But by mak­ing ben­e­fit costs more vis­i­ble, the changes could prompt more gov­ern­ments to take ac­tion to ad­dress ris­ing ben­e­fit costs.

The ris­ing costs of re­tiree ben­e­fits have plagued state and lo­cal gov­ern­ments and have played a role in the bank­ruptcies of cities like Detroit.

Ac­cord­ing to Moody’s, state gov­ern­ments alone had $454 bil­lion in un­funded retiree-ben­e­fit li­a­bil­i­ties for 2013, the most re­cent data avail­able.

via Government Retiree Costs to Be Put in the Spotlight – WSJ.