Baltimore County officials are asking the County Council to approve the issuance of $255 million in bonds to fund the pension system.
County Administrative Officer Fred Homan told the council during a Tuesday lunch briefing that he wants to use the money to invest in the pension system.
"There are market risks to a pension bond deal," Homan said, adding that the risk is not achieving the 4.25 to 4.5 percent rate of interest the county believes the bonds will sell for.
Currently, the nearly $2 billion pension system is funded at nearly 77 percent.
Homan said the move is expected to lower long-term pension system costs over the next 30 years.
The request will be part of a two-bill package introduced Monday night with a vote expected in October.
Homan is expected to later Tuesday afternoon following a council work session.
Stay with Patch for updates on this story.
Sure you free up current budget dollars with the issuance but at the expense of long term debt. In 30 years Fred will be long gone, but if the pension return rate preforms badly you have to pur more tax dollars into the pension while servicing the debt. This hamstrings you ability to issue bonds for other projects. You stall and then quickly sink. For a bondseller you make the commission up front. The politicians get to claim they solved a problem indicative of their Solomon like wisdom. (KK can continue to aspire for the Governorship.) The only losers are the taxpayers who have to foot the bill down the line. Plus KK has political cover - "It was all Homan's idea! He was the one to pitch it!)
When all of us are entitled to pensions from our employers, on top of Social Security, you'll see me support this. Only then.
However, please, BlutAusNord - let's not pretend Republicans both state and federal haven't spend as badly as Democrats. Ehrlich's spending went up 30% over the life of his term in office, for example (just going from memory, I looked it up a couple months ago and was shocked). Then there's Republicans and their reckless war spending and tax cuts in the 2000's. Historically, Republicans haven't spent like drunken sailors...but they are every bit as guilty for the mess this country is in today as any Democrat. In fact, I'd argue they are worse. At least Democrats TAX and spend. Republicans in recent history cut taxes and still spend.
"Many Americans were upset when solar-panel maker Solyndra filed for bankruptcy last September owing taxpayers more than $500 million, but retiree Robert Grady Jr. was different. The more he read about the failed company, the more irritated he became. Finally, weeks after the bankruptcy case began, Mr. Grady did something he’d never done before. He filed a claim in U.S. Bankruptcy Court. It turned out to be the biggest single claim in the case — $535 million — but it wasn’t on behalf of himself. Rather, Mr. Grady, 57, made the claim on behalf of U.S. taxpayers because he said he didn’t trust Department of Energy lawyers to look out for taxpayers’ interests. The retiree said he wasn’t looking for any money. He just wanted the loan money returned to the U.S. Treasury. Now, after more than a year, the bankruptcy case finally is grinding to a halt. Among the thousands of claims filed in the case, Mr. Grady’s is perhaps the most unusual."
Solyndra received $535 million in federal loan guarantees in 2009 and was championed by, among others, Vice President Joseph R. Biden, but its bankruptcy last year fueled an ongoing congressional probe and turned into a big political headache for the Obama administration. In the 10 months since Mr. Grady filed his claim, he has followed the case closely from his computer at home in Redmond, Wash., and he has read just about all of the more than 1,000 docket entries filed so far during the proceedings. Yet he has never had any contact with anybody from the bankruptcy court or with any of the many lawyers in the case. Still, a few weeks ago, Mr. Grady noticed finally that somebody in the case was paying attention." http://www.washingtontimes.com/news/2012/sep/12/solyndrasuit-fullrefund-totaxpayers/
I'm not a fan of this reckless spending, nor am I a fan of QE3, which isn't going to help anything imho. It's only the Fed panicking, and it's only going to make matters worse for this country going forward. Printing more money is what banana republics do. Look, I'm not an apologist for either party these days. For most Democratic spending fiascos, I can probably name a Republican one, like Haliburton. The Keystone Pipeline is an interesting situation. Clearly, it benefits the country more then it harms - because it's Canadian oil. Obviously, there are environmental concerns, but for me personally, as long as we aren't mining our own country largescale, I'm fine with it. If Canada wants to strip mine its own country and sell us the oil...then I'm all for it.