Look on Page 11 - the Maryland Legislature - in anticipation of potential litigation as a result of BRFA's enactment - has proposed a funding mechanism to try and offset a Court reversal of this legislation.
EXCERPT FROM PAGE 11
'Requires local boards of education to budget the costs to satisfy any final court judgments; prohibits the county government from reducing funds in the school budget dedicated to satisfying a final court judgment; and that, if it becomes necessary for the State to make payment, the amount will be deducted from State education aid due to that board of education in the following fiscal year
Provides an additional State grant to a county board of education to ensure that direct education aid in fiscal 2013 does not decrease by more than 5% compared to fiscal 2012'
Look on Page 19 - at how the BOE is to be funded under the newly proposed method. In my humble opinion - the MOE should not be increased, but instead, be decreased each year by the additional pension cost liability imposed on each County. The taxpayers are being 'set-up' to be enjoined by this action.
EXCERPT FROM PAGE 19
The required maintenance of effort amount paid by counties increases each year by the additional pension costs during the phase-in period.
Take a look at Page 19 of the Proposed BRFA - (Budget Reconciliation Financing Act 2012) - My Question - what makes you think the State is going to cover the liabilities - their track record shows that they are incapable of controlling losses & maintaining adequate funding levels. Moody's, Fitch, S&P have already ripped the State apart for letting the fund drop to dangerously low levels. Will not the County become culpable by withholding and advancing payment into this already underfunded account? What makes any of the localities think that the State is going to act differently this time around. The State has already lost credibility by not funding the account in 2009, 2010, and 2011.
EXCERPT FROM PAGE 19
State maintains responsibility to pay for unfunded accrued liabilities and reinvestment, as well as a portion of the normal cost and any costs above the estimates during the phase-in period.
New Posts to fall below.