An article in Governing describes the nationwide negative effect for local governments of a new GASB rule. MACo has been advocating in defense of counties on the issue.
As reported in Governing, a new rule from the Government Accounting Standards Board (GASB) requires some counties and municipalities that participate in state pension plans to allocate and disclose their share of unfunded pension liabilities.
According to Governing, this new rule provides states with good news at the cost of city and county balance sheets.
Why is the new GASB rule good news for states? While it doesn’t change overall liabilities, its requirement that they be allocated and reported results in state liabilities falling by the same amount that municipal liabilities rise. –Governing
In Maryland, eleven county governments and many more municipalities participate in the State Pension System. MACo and MML advocated on behalf of affected counties and cities regarding their portion of State pension unfunded liabilities.
For more information read the full story from Governing, Cities’ Pension Liabilities Are About to Look a Lot Worse, see our recent post, State Retirement Agency Shares Reasoning on Recent Pension Decision, and read one of the letters from State Retirement Agency to county elected officials in Queen Anne’s County about the liability allocation.