Michigan cities and counties haunted by retiree liabilities
Legacy costs for public employee retiree pensions and health-care costs have long been a multi-billion dollar headache for the Michigan municipalities and school districts that pay them.
For decades, governments and school boards bargained contracts that became the gold standard for union employees, administrators and often the elected officials who signed off on the agreements. The problem: Many communities didn’t put away nearly enough money to pay for the future retiree obligations.
Local leaders are quick to point out that not all factors that stress their budgets have been within their control; most notably, steep cuts to state revenue sharing to local governments over the years. So too, many older, industrial cities in Michigan have a diminished tax base, with few options to increase revenue.
Attempts to address the issues often have led to a collision of politics and policy, finger-pointing and mea culpas, lawsuits and lingering resentments.
Read more: http://www.bridgemi.com/public-sector/michigan-cities-and-counties-haunted-retiree-liabilities
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