MACo Formally Launches OPEB Investment Trust

This week, working cooperatively with several local governments, MACo formally launched the MACo Pooled OPEB Investment Trust Fund – a new vehicle designed to help local governments invest current funds toward future obligations for retiree health insurance, a.k.a. “other post-employment benefits.” Recent accounting rule changes have highlighted these liabilities on government balance sheets, and many counties are amidst plans to save toward these future costs.

Investing through an entity like the MACo Pooled OPEB Trust offers governments an opportunity under state law to invest funds in a manner suitable for longer term assets, and outside the laws generally governing “public funds.” The Trust arrangement ensures that the funds may not be extracted for purposes other than the intended benefits, making that distinction clear. Some counties have created similar entities on their own, but others have sought a collective effort to make costs manageable and seek greater expertise from outside advisors.

This week, the initial Trustees were named, representing entities that have adopted the Trust to be among their options for investing current or future OPEB payments. They are:

Jason Bennett, Allegany County Finance Director – Chair
Angela Lane, Talbot County Finance Director – Vice Chair
Elaine Kramer, St. Mary’s County Chief Financial Officer
Rebecca Schick, St. Mary’s County Metropolitan Commission Chief Financial Officer
Michael Sanderson, MACo Executive Director – ex officio

The Trustees formalized the founding documents for the Trust, and then heard from the various advisors who were selected to help guide the Trust through its initial stages – including developing actuarial assessments of Trust members needs and risk profiles, and developing an investment strategy for Trust assets.

Among the advisors selected by the Trustees are:
Davenport & Company – offering Trust management and administrative services
McGuire Woods – offering legal services
Boomershine Consulting – actual services to the Trust and its members
Wilmington Trust – custodial and oversight services
Wells Fargo Advisers – investment consulting

Both county and municipal governments, and other county-funded entities (like libraries and community colleges), are welcome to join the MACo OPEB Trust – regardless of whether they currently have their own Trust, have current assets in use, or only have a plan to target this issue. Contact MACo Executive Director Michael Sanderson with any inquiries.

Michael Sanderson

Executive Director Maryland Association of Counties
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