- Apr 23, 2015
The City of Worcester, like most municipalities, has struggled with outstanding pension and other post-employment benefit (OPEB) liabilities. While the City is engaged on a plan to fund its pension obligations by 2032, there is no plan in place to address the more than $727 million owed for OPEB, which mainly consists of retiree health care costs. Government Accounting Standards Board (GASB) rules require municipalities to calculate and report current OPEB liabilities, but Massachusetts law does not yet require cities or towns to address those liabilities. Without annual advanced funding, OPEB liabilities will continue to grow, reaching $1 billion by 2023 and $2 billion by 2042. As the City of Worcester prepares its FY 2016 budget, Bureau Brief – Worcester’s Unfunded OPEB Liability reviews the situation and the limited, and costly, options for moving forward.