Be sure you read more than the headline of today's coverage of last night's Worcester School Committee meeting in the Worcester Telegram and Gazette. The article is accurate; the notion that anyone on the committee is "seek(ing) council's input" is not.
Statutorily, as we were reminded last night, the ability to allocate funds within the Worcester Public School's budget belongs to the Worcester School Committee.
It does not lie either with the City Council or with the City Manager.
Do we have to fund Other Post-Employment Benefits? Yes.
Have we been doing so? Yes.
Do we--legally--have to do so ahead of time? No. We need to identify how we're going to do so ahead of time.
While there has been a great deal of discussion of the municipal bond rating, how good it is, and how paying for OPEB up front assists with that, there has yet to be any numbers associated with it.
In other words, we have been given no information that says that our superior bond rating is saving us more than paying for the OPEB is costing us.
And yes, the irony of having a superior bond rating in a city that continues to not meet its legal obligations on minimal funding of education has not escaped me.
What you need is a cost benefit analysis that shows the costs of paying the retirement benefits now and not later. You are using today's money to pay future obligations, and likely putting it in an investment account that does accumulate some interest. Those future obligations if paid in the future would be done with money that has been adjusted for inflation. Granted your benefit costs will also be impacted for inflation, so the CBA would accound for all that. The next question is does the savings, if any, on the municipal bond rating equal or exceed the cost in future expenses paid in current dollars. I know that's not something most voters get into, the details of finance, but it's where you have to with it to really understand it. Everyone likes simplistic sound bites on this stuff, but finance is a bit more complicated and big ticket finance is a lot more complicated.
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