By Mannix Porterfield
Sen. Bill Laird wondered Monday why local governments are helping the Regional Jail Authority pay off the Other Post-Employment Benefits debt when it has some $60 million in reserves.
Laird, a co-chairman of the Legislative Oversight Committee on Regional Jail and Correctional Facility Authority, posed the question to Joe DeLong, executive director of the RJA.
Information given him shows two separate cash balances totaling $61 million, including $18.7 million to cover bonded indebtedness payments, $18 million allowed by law for three months of operating expenses.
That, the senator said, leaves a cash balance of $24 million, all but $2 million of which is dedicated to the OPEB debt, or money spent on medical coverage for retirees.
Laird, D-Fayette, calls the situation “unique,” saying he knows of no other state agency relying on local governments to help satisfy an OPEB obligation.
“That leads me to speculate this has something to do with a need to reserve bond ratings,” he said.
“I assume bond holders like to see that there’s money. I assume that’s since the collection of court costs and fees are down to the point where you’re not capable of meeting the bond obligation.”
Laird said he isn’t convinced that local governments are responsible for funding a state agency’s OPEB obligation.
“For the life of me, I fail to understand how local units of government can be called upon to continue to fund that kind of reserve that seems to be just there,” he said.
Laird said counties in his district are facing tough decisions in meeting their own obligations.
“Special projects at local levels are being literally burned at the stake as a result of what is represented as being a payment requirement for the regional jail,” he said.
“We need a substantial reduction in regional jail costs to burn off what has been a surplus that has resulted from what can only be an overpayment of what your actual costs requirements are to run the agency.”
DeLong said the RJA is required to pay the OPEB debt and, if it fails to do so, the agency is running in the red.
The director said he would give the committee all the data through its financial officer at the August interims.
“I fully recognize the struggle that these counties go through,” DeLong said.
“But you also have to recognize that our per diem has not increased in years. It’s actually down. And the reason why counties are struggling to pay the per diem has nothing to do with the rate of per diem. It’s probably the lowest per diem in the country. It has more to do with the volume.”
Put simply, he said, “We are just arresting and incarcerating far more people than we’ve done in the past. It’s a volume-driven issue.”
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