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Report to the county board
Wed October 16, 2013
Oneida County Faces Millions In Retirement Health Costs
Oneida county has more than 8 million dollars pending in health benefits being paid to workers who have left county employment, mainly through retirement.
A county financial advisor, John Frederick, updated the county board Tuesday.
He says current accounting practices find the health care benefit must be reflected during the time the person is employed, rather than as a gratutiy after they retire...
"...the costs are incurred each year from date of hire to date of retirement with the idea of fully reflecting the costs of the retirement by the time the employee retires. From that point forward the benefits are paid out..."
He outlines the updated numbers..
"...the value of all future benefits is expected to be about $12.7 million. And the portion attributable to prior service is about $8 million, 90 thousand(dollars). And the annual cost ...each year is about $900,000....
County Finance Director Margie Sorenson called that issue the "800 pound gorilla in the room". She says the county has been paying the costs as they go, rather than stashing money for the payout at the end, and the cost in 2014 would be around $305,000.