How to Reduce Liabilities and Lower Health Plan Expenses for Public Entities
Public Entities Struggle to Meet Obligations
From the local to the state level, the days when governments could hike taxes to raise needed funds are mostly a memory. In the wake of the Great Recession, entities from school districts to cities and counties continue to struggle, and governments are finding it difficult to ask more from a shrinking tax base. In this environment, almost three dozen municipalities haved filed for bankruptcy since 2010. The latest filing was the largest.
In late February, officials in Detroit detailed a plan to exit the largest municipal bankruptcy in U.S. history, looking to restructure $18 billion in debt. According to The Wall Street Journal, employee and retiree pension and healthcare obligations accounted for about $7 billion of that debt — almost 40 percent of the city’s total. Short of bailing on these obligations —The Journal estimates Detroit’s public employees will have to settle for as little as 30 percent of what was initially promised — there are still ways to survive in this environment.Read More »How to Reduce Liabilities and Lower Health Plan Expenses for Public Entities