Retiree Health Costs Discussed in Bay Area
Contra Costa County supervisors have been "extremely slow to address retiree health issues" and have not accounted for significant retiree health costs in the fiscal year 2006-2007 county budget, according to a grand jury report, the Contra Costa Times reports.
According to the report, the county should more than double its annual payments for retiree health care costs. Currently, the county pays $32 million per year, but the report recommends that the county should pay at least $65 million annually for an estimated $1.4 billion to $2.6 billion health care liability.
County Administrator John Cullen said the county must create a fund that matures over time to cover retiree health care costs.
Board of Supervisors Chair John Gioia criticized the report, saying it did not take into account county action on retiree health care that will reduce costs in the future, such as negotiations with unions over benefits (Rosen Lum, Contra Costa Times, 6/9).
San Francisco Mayor Gavin Newsom (D) on Thursday said he would negotiate with unions to increase San Francisco's tenure requirements to be eligible for retiree health benefits as a way to control future health care liabilities, the San Francisco Examiner reports. The city will pay about $100 million this year for retiree health care.
City Controller Ed Harrington said he will release a report within the next two weeks detailing San Francisco's unfunded liability, which likely will be billions of dollars.
San Francisco will negotiate with its 38 labor unions over the next two years. Any changes to retiree benefits must be approved by voters.
Director of the Department of Human Resources Philip Ginsburg said San Francisco should develop a fund for retiree health benefits that is similar to the city's pension fund (Sabatini, San Francisco Examiner, 6/9).