It's Your Money - Study Session: How To Deal With Billions Of Dollars In City’s Unfunded Liabilities
Joshua H. Silavent - Staff Writer
February 12, 2013 – The Long Beach City Council is holding a study session tonight, February 12, to examine the billions of dollars in unfunded liabilities that potentially threaten the city’s long-term fiscal health.
“What we’re trying to do is just make sure the council remembers that even if things start getting better in the general fund, we have significant unfunded liabilities that need to be addressed,” Councilmember Gary DeLong told the Business Journal.
Finance Director John Gross told the Business Journal that unfunded pension costs for city workers alone tops $1 billion.
Other unfunded liabilities, which are largely attributable to personnel costs, include sick leave coverage and workers’ compensation. “So these are some areas where we may be incurring costs now or liabilities and we may not be funding them at their full share,” Councilmember James Johnson told the Business Journal.
Much of the city’s unfunded debt goes back years, perhaps decades. They are promises made without consideration for how they will be fulfilled. Johnson said that addressing these liabilities is a matter of “inter-generational justice.”
Moreover, identifying the scope of this debt and looking at ways to draw it down will help stabilize the city’s finances in the future. “A lot of political bodies, they only face what’s in front of them right now and the crisis of today,” Johnson said.
“Once we understand how significant the dollar amount is,” DeLong said, “it is more than likely appropriate to begin discussion with the employees about how they can contribute to those unfunded liabilities. These are their benefits.”
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