Dear Friend,
New York City has $92.5 billion in health care costs for retirees, and
no ability to pay for them.
This week, I introduced a proposal that would require the City to begin
saving money for our massive and under-funded health care obligations
for retirees.
In our labor agreements, city leadership has promised past, current, and
even future employees health benefits for their retirement. The bill for
those promises is $92.5 billion today. It doesn't come due all at
once, but it does come due.
We currently have $2.4 Billion in the Retiree Health Benefits Trust, which
I helped to create in 2006. This trust allows us to put aside funds to
tackle these long term obligations. Unfortunately, we didn't require
rules for deposits or withdrawals, so when times were good, we put in
a few billions dollars, and when we we needed the money, we took it right out.
This initiative -- supported by the Citizens Budget Commission, Citizens
Union, and the Partnership for New York City -- would guarantee a certain
level of minimum contributions to the trust, so that it grows over time
and will ensure that we do not get caught with a bill we cannot pay. The
funds could only be accessed for health care costs, or in a severe recession.
You can read the details
here.
This is a reasonable and affordable way to come to grips with our unfunded
liabilities. You can read more about the proposal in the
Daily News,
NY Post,
Gotham Gazette and
Capital NY.
I welcome your feedback.
Best,
Dan
[Garodnick]