Gov. Earl Ray Tomblin, joined by state Senate President Jeffrey Kessler, House Speaker Rick Thompson and members of the legislature, today signed Senate Bill 469 relating to Other Post-Employment Benefits (OPEB).
"As a former school teacher I personally know what this will mean for our teachers, but more importantly, what it will mean for the students in the Mountain State," Gov. Tomblin said. "Relieving county boards of this liability means that Morgantown High School teacher Sam Brunette will now have funds to outfit his award winning Graphics Art class with computers, in pursuit of 21st century skills; it means that Kanawha County librarian Gina Miller will now be able to continue to open the world to the students at Malden Elementary with all day library services; it also means that the students in Marlinton Middle School will have access to portable computer labs while in Christine Campbell's language arts class."
The governor's legislation, passed near unanimously in the House and Senate, dedicates $30 million a year beginning in approximately 2016 to address the $5 billion unfunded liability caused primarily by past promises that became too expensive to maintain. This legislation will eliminate the state's last unfunded liability by 2036. At the same time, the bill establishes an employee trust fund for those state employees hired after July 1, 2010. Each year $5 million will be put into this fund and invested for those employees. The bill will also save the county boards of education $485 million in future OPEB liability payments. Today, the counties who have saved money for payment toward this debt can now utilize the $20 million that they have saved for their local needs.
With the governor's signature, West Virginia becomes a national leader on OPEB and continues to strengthen its dedication to fiscal responsibility.
"West Virginia is the first state in the nation to address OPEB among those that have similar obligations," said Senate President Jeffrey Kessler. "This shows that West Virginia is ahead of the curve and that we are serious about keeping our fiscal house in order."
"This massive debt has been not only problematic for the state's financial picture, but also a very troubling issue for local school systems," said House Speaker Rick Thompson. "Through this legislation, the county school boards will finally have some relief. I am proud that we are getting this burdensome liability under control, and keeping the focus on the long-term fiscal stability of the state budget."
Late last year, the PEIA Finance Board cut the $10 billion OPEB liability in half by providing a 3 percent cap on that subsidy, reducing the liability to $5 billion and helping to responsibly manage and limit the future growth of OPEB.