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Franklin retirees' health plan 'hurting'

January 22, 2009|By DON AINES

CHAMBERSBURG, Pa. -- A health care program for Franklin County retirees will need an infusion of money to keep it fully funded, both for 2008 and 2009, Fiscal Department Director Teresa Beckner told the Board of County Commissioners on Thursday.

The county budgeted $1.2 million for the Post-Employment Health Benefits program and $1.3 million for 2009, Shank said. The county is required by Governmental Accounting Standards Board rules to report the fund's annual liability, she said.

The county is not required to fully fund the trust annually, but Beckner is recommending the county do so. Otherwise, it could affect the county's ability to borrow in the future, she said.

Fully funding the program will require an additional $800,000 for 2008 and $700,000 for 2009, Beckner said. The program had been operated on a "pay-as-you-go" basis, but will now be funded to anticipate future liability.

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In December 1986, a previous Board of Commissioners established an obligation to provide health-care coverage to retired employees and spouses, Commissioner Bob Thomas said. Some years later, the county realized the program would become a huge financial burden, he said.

"They didn't establish a fund that was self-supporting," Thomas said.

No one hired by the county after Dec. 31, 2001, is included in the program, Beckner said.

While the annual required contribution to the retirees' health-care plan was low in 2008, Beckner said the county contribution to the pension fund was about $500,000 above what was needed to keep that plan fully funded. That excess could offset part of the shortfall for the health plan, she said.

Beckner could not say how much of the money to fund the health-care plan might come from the county's general fund. Many of the county's more than 900 employees have their salaries paid through either state or federal subsidies, which figures into how the plan is funded.

The trust fund currently has $1,196,577 and there are 492 beneficiaries, she said.

Funding for the pension plan is based on estimates at the beginning of the year and the actual cost is not known until the year is complete, Beckner said, explaining the overfunding.

Franklin County has more than $1 million in a designated solid waste fund, money set aside to administer recycling programs, Beckner said. However, the fund has been inactive for a number of years.

Beckner recommended the commissioners take the necessary legal steps to remove the designation from the fund so that it can be used for other purposes.

In this tight budget year, state reimbursements for programs administered by the county's Children and Youth Services are coming in slowly, Beckner said. She recommended expanding from $1 million to $1.5 million the tax and revenue anticipation note used to fund that program until revenues catch up.

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