RES 781 Draft 01 2018-2020 - Laserfiche WebLink

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• s ■ 1 To address this unfunded liability, Act 268, Session Laws of Hawaii 2013, requires the State and 2 counties to prefund other post-employment health and other benefit plan costs for retirees and their 3 beneficiaries by making annual contributions to the other post-employment benefits trust 4 fund. State. county. and other public employers' annual contributions to the other post- s employment benefits trust fund totals $427.299.249, while all assets of the trust fund total 6 $2,370,481,565. for fiscal year 2018. 7 Meanwhile, the State, counties, and other public employers are also required to make 8 payments to cover a portion of pay-as-you-go Hawaii employer-union health benefits trust fund 9 costs. Clearly. given current and projected revenues, the State and the counties cannot afford to 10 prefund both health and pension unfunded liabilities, which are projected to total more than 11 $800.000,000 per year in later years. A more affordable and less painful solution is necessary. 12 Furthermore, the Hawaii employer-union health benefits trust fund projects a seven per 13 cent investment return on funds in the other post-employment benefits trust fund. which amounts 14 to an estimated $140,000,000 that will be deposited into the rate stabilization reserve fund each 15 year. By not requiring other post-employment benefits prefunding through 2049,this Act will free 16 up moneys for important state, county, and other public employee services, projects. and needs. 17 Accordingly,this part: 18 (1) Caps public employer prefunding to the other post-employment benefits trust fund 19 once the separate accounts for each public employer have a combined subaccount balance of at 20 least$2.000,000,000; 6