Center for State and Local Government Excellence Awards Second Grant

Saturday, August 25, 2007 General News
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WASHINGTON, Aug. 24 The Center for State andLocal Government Excellence has awarded a $377,000 grant to North CarolinaState University to study state and local government health care benefits.

Under the 18-month grant, North Carolina State will assess the status ofstate and local government health care benefits, alternative plans andapproaches, and costs and estimated future liabilities. The study will:

State and local governments are under pressure from a number ofdirections. GASB Statement No. 45 requires state and local governments toreveal the future costs of their non-pension post-employment benefits,including health care; indications are that many health care plans areunder-funded and costs are rising faster than inflation. At the same time,state and local officials must become more competitive with the private sectorto hire and retain the talent they need to provide critical public servicestheir residents demand.

The human resource exodus of knowledge workers as baby boomers retire willbe more intense for governments because their workforce is older and theyemploy more individuals with advanced degrees than does the private sector.According to 2006 Census data, 48 percent of private sector workers were over40 years of age, compared with 60 percent of state government workers and63.5 percent of local government workers.

"Providing high quality, cost-effective health care benefits for theiremployees is a high priority for state and local governments," said Center forExcellence Executive Director Elizabeth Kellar. "They know that they need toadopt progressive employment practices and to offer good benefits to becompetitive. This study will identify innovative health care programs andwill give state and local officials the tools they need to better estimate andfinance their health care obligations."

In May, the Center awarded its first grant to the Center for RetirementResearch at Boston College to establish a data clearinghouse on state andlocal pension plans and explore their funding status and economic impact.

About the Center for State and Local Government Excellence

The Center for State and Local Government Excellence supports efforts tomake state and local governments knowledgeable and competitive employers sothey can attract and retain a skilled and committed workforce. The Centeridentifies best practices and conducts research on competitive employmentpractices, workforce development, pensions, retiree health security, andfinancial planning. Please visit for more information.

About North Carolina State University and the School of Public andInternational Affairs

Founded in 1887 as a land grant institution in Raleigh, NC, State todayenrolls 30,000 students. Dedicated to serving North Carolina and the nationwith practical knowledge and analysis of government and public affairs, itsSchool of Public and International Affairs includes graduate and undergraduateprograms in political science, public administration, and internationalstudies.-- Identify practices that show the most promise for providing retiree health care benefits. -- Assess post-employment health care available to state and local government employees. -- Calculate the financial contribution by state and local governments to retiree health care prior to age 65 and after, including co-pay costs, employer contributions, and employee contributions. -- Measure to what extent employers are pre-funding health care for state and local government retirees; what is guaranteed; how much of the cost shifts to employees after they retire; restrictions on how much state and local governments can draw from pension funds to pay for health care; and what is co-mingled.

SOURCE The Center for State and Local Government Excellence

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