Beginning with the fiscal year 2011-2012 adjusted budget, our annual budgets have included the full, actuarially determined contributions to pension and retiree medical plans, without the use of reserves. Further, our multi-year forecast assumes the continuation of this full funding approach. In short, we are fully funding our pension and retiree health plans with current operating revenues.
We have also taken clear and decisive steps to reduce pension and retiree health liabilities and have put plans in motion to ensure sustainability of employee benefits while continuing to offer the services our community expects. (Examples of steps include new, lower benefit tiers; employees pay an average of 12.0% of salary towards their pensions; changes to prevent “pension spiking;” creation of an irrevocable trust for retiree health assets; and reducing the retiree health benefit for new hires to the lowest level allowed by law).
For a complete summary of retiree healthcare reforms as of summer 2013, see our response to a Grand Jury report on retiree healthcare throughout Marin.