Local governments often give retired police officers, firefighters, teachers, and other workers a pension plus healthcare benefits.
That’s about to change.
That’s on top of the estimated $1.1 trillion in unfunded pension liabilities they already had. In other words, this giant problem that no one knows how to solve is about to get 59% worse!
Healthcare is expensive even in the best circumstances. Imagine your health insurer had promised to cover your medical expenses but hadn’t set aside any cash to pay for it.
Remarkably, that’s exactly what has happened. Governments currently disclose their retiree healthcare liabilities only in footnotes to their financial statements. Many have saved little to no money to cover those future expenses.
Starting in 2018, the Governmental Accounting Standards Board—the source of generally accepted accounting principles (GAAP) for state and local governments—will force officials to record healthcare liabilities on their balance sheets. Pew Charitable Trusts estimates the national shortfall will add up to $645 billion.
Fortunately, Georgetown does not have large unfunded liabilities for retirees healthcare, but, it bears watching. There are several aspects of the retiree healthcare plan are are worth noting.Or, more accurately, it’s going to look 59% worse. The healthcare shortfall isn’t new. What’s new is that local governments have to stop obscuring it.
To stimulate low-income housing construction, the federal government allots a share of tax credits to the states, which dole them out to selected developers. The credits cover part of the construction costs of multifamily housing projects. The developers must cap rents for a share of the units, so the benefits of the tax credit are meant to flow to tenants in the form of lower rents. Yet the developers usually sell the credits to banks and investors, often using syndication companies as intermediaries. The investors, developers and middlemen—not poor families—end up grabbing most of the benefits.
Gregory Burge of the University of Oklahoma estimated in a 2010 study that the value of the rent savings for tenants was a mere 35% of the value of the tax benefits going to developers.
The housing credit is also a prime target for abuse. Earlier this year a National Public Radio reporter profiled a Miami-area business that stole $34 million from 14 low-income-credit housing projects by submitting inflated construction cost data to the government. Another Miami company discussed by NPR stole $4 million from four projects by the same method.This brings up an interesting question. Has the Texas tax credit program been audited to ascertain that the funds are being spent consistent with the program requirements?
The purpose of the Housing Advisory Board is to ensure that the City has affordable housing for residents of all income levels. The Board is responsible for providing long-range housing research and policy recommendations with the housing element of the City’s comprehensive plan. The Board is also responsible for reviewing and making recommendations regarding housing developments that request City support for state and federal funding.The City also apparently established a permanent staff position of "housing coordinator".
Total unfunded liabilities in state and local pensions have roughly quintupled in the last decade. You read that right – not doubled, tripled or quadrupled: quintupled.This has happened in a period of positive economic growth and significant growth in stocks, in which pension funds invest.
But wait, it gets still worse. (Do you see a trend here?) Many state and local governments have actually 100% funded their pension plans. Some states and local governments have even over funded them – assuming they get their projected returns. What that really means is that the unfunded liabilities are more concentrated, and they show up in unlikely places. You think Texas is doing well? Look at some of our cities and weep. Look, too, at other seemingly semi-prosperous cities all over the country. Do you think the suburbs of Dallas will want to see their taxes increased to help out the city? If you do, I may have a bridge to sell you – unless you would rather have oceanfront properties in Arizona.
This issue is going to set neighbor against neighbor and retirees against taxpayers. It will become one of the most heated battles of my lifetime.
And there is nothing more local than police and firefighters and teachers seeing their pensions cut because the money isn’t there. Tax increases of up to 100% are going to become commonplace. But even these new revenues won’t be enough… because we will be acting with too little, too late.
This is the core problem. Our political system gives some people incentives to make unrealistic promises while also absolving them of liability for doing so. It also places the costs of those must-break promises on innocent parties, i.e. the retirees who did their jobs and rightly expect the compensation they were told they would receive.
So at its heart the pension crisis is really not a financial problem. It’s a moral and ethical problem of making and breaking promises that profoundly impact people’s lives. Our culture puts a high value on integrity: doing what you said you would do.Read the entire article. It is a wake up call to all of us!
Andrew Appel, a professor at Princeton University, said it would be easy to write a program that cheats on election results and deletes evidence of the hack as soon as the results are reported.
The analysts didn’t point to any specific election that they knew had been compromised, but they said hackers likely would leave fingerprints only if they wanted to be spotted and hurt confidence in the U.S. electoral system.
“To ignore the fact that the computers are completely hackable and to try to run elections, as some states do, where they entirely rely on the word of a computer program on who won is entirely irresponsible,” Mr. Appel said.
“There’s no perfect security; there’s only degrees of insecurity,” said Ronald Rivest, a professor at the Massachusetts Institute of Technology.
He said hackers have myriad ways of attacking voting machines. “You don’t want to rest the election of the president on, ‘Maybe the Wi-Fi was turned on when it shouldn’t have been.’”
He and two other computer security experts said bar codes on ballots and smartphones in voting locations could give hackers a chance to rewrite results in ways that couldn’t be traceable, short of sampling of ballots or hand recounts — and those work only in cases where there’s a paper trail.
A newly released U.S. Department of Energy report on electricity markets and reliability makes it clear that renewable energy subsidies are contributing significantly to the increasing cost—and the decreasing reliability—of the national electric grid. The HillThe electrical grid has been designed to distribute electricity with stable generating sources providing for the base electrical load. With the intermittentancy associated with renewable sources, instability in the grid becomes an increasingly important issue for the grid operator to deal with.
The Strategic Partnerships for Community Services Advisory Board makes recommendations to the City Council to further the purpose of City funding to the nonprofit sector of cultivating and sustaining partnerships with 501(c)3 organizations that strengthen the City’s key priorities in Public Safety, Transportation, Housing, Parks and Recreation, Veteran Services and issues of Safety Net. This Advisory Board participates in the grant funding process. They review and evaluate applications submitted to the City for social funding.The budget for this board to fund community services is $400,000 this fiscal year. Here is a list of their proposed activites to fund:
As for the original $60 million projection (or $90 million with the cars), the cost of getting MetroRail up and running grew to what the agency eventually acknowledged was $140 million, for a lot of reasons. The cars cost $36 million rather than $30 million. The agency had to add an expensive rail bridge over an intersecting Union Pacific rail line. And the original track control systems turned out to be more complex and expensive than expected.Ridership projections have also been wildly optimistic. They promised 6,900 riders per day by 2017 and here we are.
They got ridership up to that initial 2,000 a day projection, then, with further tweaks, to the 2,500 to 3,000 a day level.
That is basically where ridership still sits. The weekday average boardings between July 2016 and this June was 2,900 a day, most of them commuters making two boardings each day.
Sharp-eyed readers will note that is a smidgen below the original 2017 projection. In fact, it is about 42 percent of the projection.Read the entire article to fully appreciate how our politicians and rail advocates "lie" to us, the taxpayers, about the cost and ridership of rail systems.
