Ready for more depressing news on the state's bleak financial outlook?
I thought you were.
New Jersey Spotlight reports that New Jersey - which is the worst in the nation in unfunded retiree health-care costs, topping even debt-ridden California - expects the annual cost of benefits to retirees will more than double over the next nine years.
I know the numbers get eye-glazing, but here they are:
Health care for retired teachers and state workers will go from $1.27 billion to $2.75 billion ... annually. Moreover, even if the state makes the partial pension payments it's promised to over the next several years, those payments are expected to rise to more than $5 billion in nine years. Add it up. That's going to mean huge cuts in other areas, quite possibly big-ticket items like municipal and school aid, and/or tax hikes.
County and municipal workers' health-care costs in retirement will double as well, from about $500 million to $1 billion. That, too, means service cuts or property-tax hikes. Health-care costs, notably, are exempt from the 2 percent property-tax cap.
The good news is that unlike the pension system, where politicians push off payments endlessly until they are hopelessly behind, the health-care costs must be funded on a pay-as-you-go basis. Those costs could be reduced by prefunding - but considering the state doesn't even make its payments to the pension system, don't expect that to happen anytime soon.
The combined unfunded liability of pensions health-care costs to retirees is $114.5 billion - or $13,700 for every state resident.
And rising.
And until people - voters - stop glazing over on issues like these, politicians will continue to take the easiest way out. And the hole will just get bigger.
