Patrick Cloney asks Mike Wilson, Rogelio “Roy” Gomez…

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PDSIR: Pension Debt Service Impact Report

HumCo’s pension debt increased from $220 million in 2015 to $330 million in 2021, which saw HumCo announce its projected pension contributions would increase by $17 million …per year… for least the next decade. With this financial burden, would you, as County Supervisor, bring forth a yearly PDSIR: a Pension Debt Service Impact Report? A PDSIR would be a yearly report presented at budget time that would list Humco’s current pension debt, project payments for the year, and how these debt payments will impact services. 

— Patrick Cloney

Response

Mike Wilson

Thank you for this question; it’s an important topic. I believe Supervisor Bohn answered this question quite well. Since I agree with his response, I will answer by copying his response below (thanks, Rex!):

 

“Ensuring pension funding remains a top priority for the county. The implementation of the Public Employees’ Pension Reform Act (PEPRA) in 2013, which set compensation limits to balance pension obligations and reduce long-term liabilities, is now showing positive results for the county.

 

The county has a pension funding policy which details the strategies the county has taken on a yearly basis the agency re-evaluates the unfunded pension liability, which varies from year-to-year basis on market rates. As of June 2021, the safety plan pensions were 77.3% funded and miscellaneous plan pensions were 78.8% funded. Certainly, addressing the unfunded pension liability is a critical aspect of responsible financial management. I will continue to support an annual review of our pension liabilities and strategies. This review would be presented at budget time, providing transparency and a clear understanding of the county’s current pension debt, projected payments for the year, and the anticipated impact on services.

 

In response to the increasing pension debt and its impact on Humboldt County’s budget, the review serves as a tool for informed decision-making, allowing both policymakers and the public to assess the financial implications of pension obligations. By regularly presenting this report, we can foster accountability, maintain transparency, and ensure that Humboldt County residents are well-informed about the challenges and strategies associated with managing the pension liability.

 

This approach aligns with a commitment to responsible governance, allowing us to navigate the financial complexities effectively and make informed decisions that balance fiscal responsibility with the delivery of essential services to our community and peace of mind to our valued retired annuitants for their financial security and of course, out current and future dedicated employees.”