The ARRA stimulus money was supposed to help put the nation back to work. But what did the O'Malley administration do - it took 329 million dollars of the 3.8 billion MD stimulus package and directed it towards increases in teacher retirement benefits. What is alarming - is that Annapolis State lawmakers neglected to identify how they would pay for the new spending, which must be financed every year in perpetuity. The ARRA stimulus runs out in 2012 - and so the $329 million basically provides only temporary relief from the ill effects of state lawmakers neglecting to make a difficult financial decisions in subsequent years.
Payment No. 2 -
Fast forward to this Tuesday's scheduled meeting with Governor O'Malley, Senator Mike Miller, and House Speaker Busch. To restore the State Retirement and Pension System (SRPS) to fiscal health, the appointed Pension Commission recommends shifting a portion of the liability onto the Counties. Beginning in fiscal 2000, the system actuarial liablities consistently grew faster on an annual basis than its actuarial value of assets, resulting in its unfunded liabilities increasing each year to the present. As a result, the system's actuarial funded status, which reached 100% in fiscal 2000, has dropped to 64.1% as of June 2010. This has prompted the growth rate for State pension contributions to far outpace its revenues. From fiscal 2002 to 2011, the annual state cost of teacher pensions grew 159% while general fund revenues grew just 39% - thus the present crisis. Current projections predict that annual State general fund expenditures on pension for both State employees and teachers will grow at twice the annual rate of general fund revenues between fiscal 2012 and 2015. While general fund revenues are expected to grow at 4.9% annually during that time, pension costs are projected to grow 9.9% annually. These trends make the current structure of State pension benefits unsustainable.
Maryland Counties - Look out, cause here it comes. You are about to inherit a partially depleted asset - with extensive exposure.
14 comments:
These people do an important job but it doesn't deserve a golden parachute. I bust my but and I get what I put in.
I have to pay for my own retirement.
There has to be way to make them pay for their own also! and if they don't like ti then time fo rthem to find another line of work. which I am sure will require them to pay for their own retirement anyway! this is total bs!
Now we know who got the stimulus.
Guess who - not the taxpayers, not the electricians, plumbers, pipefitters, not the beauticians, not the barbers, not the UPS or Fed Ex men, - nope - the government workers.
This crap has got to stop. We have to get rid of these leaches.
Great, first we get a 14+ million dollar hole in MOE, and now we are faced with potentially millions more in pension liability for an asset that has been plundered, pillaged, looted from the taxpayers coffers.
And people wonder why all of the businesses have left our so called great State. I'll tell you what our great state is - it is in a state of confusion.
I anticipate that the Governor, Senate President, House Speaker will try and sugar coat the intial shift by 'low balling' the intial price tag claiming that it will have minimal effect.
Then just as the pension cost swells to its maximum liability the State will have 'sunset provisions' that effectively takes them off the hook - thus the counties will bare the brunt of the burden. You watch and see if I'm not correct. Some of our elected officals have such a mindset as to believe all of the State government bullcrap.
By then - they'll be no record as to where all of the money disappeared to and O'Malley will be in the White House.
Response to 6:47
Come on now. Sounds as though you are saying that some of our politicians might have devious intentions.
As the old saying goes; Maryland is the best training ground for corrupt politicians. I believe this article reveals that fact to be true.
Shoooooo. Be quiet about all of this politically damaging information. The public might be listening and we don't want them to know about what is going to hit them in their hip pockets. They might not be so forgiving come election time.
It's time to stop all State& County Retirement packages----Now! The taxpayer cannot afford to keep it up!
One keen observation I've made about some of the elected democratic Delegates from our area(Conway & Cane). They have certainly made a lot of enemies among the respective county councils from the lower eastern shore. Not to mention their respective electorate.
Where did the information come from about O'Malley increased teachers'pension with ARRA funds? I most certainly did not have my retirement increased and I pay into that lousy system.O'Malley will steal money from any account he can get his hands on!
I can just hear it now,"We've had to make some very difficult decisions in the name of educating our young people and keeping our education system among the top in the nation.Instead of "We have stolen the money from the retirement fund because we could and the money was there.I'm really sorry for this and I will have myself prosecuted."
To 11:01
First off I would like to know why he took ARRA money that was slated for business stimulus and a reduction in unemployment - and then injects it into the schoolteachers pension fund. Not one single job was created from the injection of the ARRA money into the pension fund. But what is even more appauling is that the State did not fund any moneys during the two years that the ARRA stimulus money was used for the injection into the pension fund.
And people think that Bernie Madoff had a scam going.
Reference 9:00 PM Posting
I would add Senator Mathias to the mix with Conway & Cane. Look what he did to the Worcester County commissioners in regards to the residential sprinkler legislation.
Do not think that these individuals will not be remembered in future dealings with the Dorchester, Worcester, Somerset, Wicomico, Talbot, officials. Like you said - I believe these Delegates have made a lot of local enemies.
I believe the people of Maryland will soon realize that they are being set-up for big fall. There are aspects in regards to the faltering pension fund that are not well known by the public -(OPEB) - liability. When Wicomico officials learn about the new federal accounting standard and the lack of OPEB funding - the excrement really will hit the fan.
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