State OPEB Liabilities Might Be $498 Billion

NASRA with SLGE using CAFR data released a 2014 update of their 2013 report on state OPEB UAAL.

However they did not do a direct comparison between the two studies so I did.

The 2014 study does begin with the explanation:

A 2013 report from the National Association of State Retirement Administrators (NASRA) and the Center for State and Local Government Excellence (SLGE) examined the finances of health care benefits provided to general state employees for reporting periods 2011–2012. This update offers finance data on other postemployment benefits (or OPEB) which is expanded to include additional state and local government employee cohorts including teachers, public safety officers, university employees, and legislators, among others.

.

But would that explain why, after grouping by state and then percentage change, New Jersey’s OPEB liability in one year goes from $18.078 billion to $63.881 billion – a 253.36% increase?  Or Texas from $20.823 billion to $52.314 billion – 151.23%?  Or even Oklahoma from $359 million to $4 million – a 98.89% decrease?  And for all states combined have liabilities really risen from $399.461 billion to $497.693 billion – 24.59% – when presumably states have been reforming their OPEB plans?

It may but, based on what I have seen of government accounting around here, a more likely explanation would be GIGO.

3 responses to this post.

  1. Posted by Sheila Weinberg on December 16, 2014 at 3:54 pm

    Here is what Truth in Accounting found:

    $543,626,774,000

    $24,783,986,000 4%

    4 percent opeb funded.pngFor the most part states have not set aside money to pay OPEB benefits, relying on a “pay-as-you-go” system. Truth in Accounting’s analysis of all 50 states found only 4 cents has been set aside to fund each dollar of the promised retirees’ healthcare benefits.

    Determining state retirement liabilities is difficult due to the opacity of financial and actuarial reports for retirement plans of states and their component units. Calculation of some states’ retirement liabilities is made even more difficult because the state is involved in a multi-employer, cost-sharing retirement system.

    $24,783,986,000 4%

    We included the OPEB for each state’s comp

    $24,783,986,000 4%

    onent units.

    Sheila

    Sheila A. Weinberg

    Founder & CEO

    Truth in Accounting

    847-835-5200

    (c) 847-344-3824

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