Senate committee nixes OPEB relief plan
House committee, however, OKs billMichael Erb
PARKERSBURG - Local education officials were left scratching their heads Wednesday after the West Virginia Senate Finance Committee in Charleston rejected a plan to give school boards a temporary reprieve from a growing OPEB debt and in the process stave off a possible lawsuit against the state.
The committee voted Wednesday to reject Gov. Joe Manchin's special session proposal to allow them a partial, one-year reprieve from Other Post-Employment Benefit costs.
The governor wants lawmakers to allow government employers to pay just what they owe their current retirees in ''other post-employment benefit'' costs this budget year. A nearly unanimous committee instead favored pursuing a long-term solution that also addresses future, promised benefits during the 2010 regular session. It starts in January.
''I don't think we should be doing this in a special session,'' said Sen. Robert Plymale, D-Wayne. ''We need to do a lot more work on this, from the Senate's standpoint.''
Manchin spokesman Matt Turner noted the House version of the bill remains alive. The House Finance Committee advanced that version to the full House later Wednesday.
Wood County Schools Superintendent Bill Niday, who also heads the state's Superintendents Association, said he was unsure of the reasoning behind the move.
"I don't understand why they killed it," he said. "I agree we need a long-term solution to OPEB. The purpose of this bill was to make sure counties weren't getting additional harm while there was an attempt to work out a long-term solution."
Wood County Board of Education President Rick Olcott, who also serves as president of the state School Boards Association, called the move "a slap in the face" to the governor's task force, which came up with the plan.
"I'm pretty disappointed," Olcott said. "I don't know the reasons."
Forty-nine of the state's 55 counties have banded together in a potential lawsuit against the state concerning the OPEB issue. The districts want the courts to decide who ultimately is responsible for the debt. At a recent Wood County Board of Education meeting, Niday said all of the preliminary work had been finished on the lawsuit, which could be filed in early December if no changes are made at the state level during this special session.
Niday on Wednesday declined to comment on the lawsuit.
"I really can't say more until after the special session," he said.
The mounting Other Post Employment Benefit debt is a major concern for the local school system. Wood County Schools set aside $1.8 million in last year's budget to cover OPEB. The district is now receiving a monthly invoice for $1.33 million from PEIA. By next fall the debt for Wood County Schools is expected to top $16 million.
For years the state has allowed employees to cash in unused sick leave to pay premiums on the state retirement fund. The practice has created a growing debt with no source of funding. Federal accounting rules require an employee's last employer to record the debt on its books, meaning school systems could be stuck with the bill and no way to pay.
Roane and Wirt counties are facing similar situations, as both will be required to report the liabilities this coming year. Both have little in the way of funds to set aside to cover the debt, however, and will go into a deficit almost immediately, officials said.
Manchin administration officials have brokered meetings to avoid a lawsuit, and say the legislation offers breathing space for that process.
Plymale and other committee members greeted the boards' threat to sue with a bring-em-on stance.
''If this suit goes on to a court of law, and a court of law says, 'These are your employees, this is your debt,' what are they going to do then?'' asked Sen. Roman Prezioso, D-Marion and an educator in that county.
Sen. John Unger, D-Berkeley, said West Virginia would be ''cooking the books'' by pretending for one year that the debt is not owed, for bond-selling purposes.
''I can't believe we're actually discussing this,'' he said. ''It may not be illegal, but it seems unethical if we're starting to shift debt around without anyone taking responsibility for it.''
''We are doing nothing dishonest, nothing unethical,'' replied PEIA Director Ted Cheatham, who took issue with Unger's read of the proposal.
The Associated Press contributed to this report.
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Watching
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11-19-09 10:21 AM
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The state is the largest employer IN the state. The state HAS to come to terms with streamlining its current payroll. Every department should be scrutinized for position cuts. All state vehicles should be parked when not in use for state purposes, and used oon a "sign-out" basis. And, finally, school systems should be combined, with one superintendent overseeing several counties from within a RESA type department. Otherwise, cut the RESA's as part of the stream-lined effort. West Virginia is on a roller coaster collision course and we're riding in the first car!
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gorilla
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11-19-09 9:59 AM
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The state is learning from the federal government how to shuffle the citizens tax dollars to cover up management errors. It doesn't work!
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