Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Pensions topic
No spam. Unsubscribe anytime.
Commissioner outlines bond plan arguing it could boost Livingston County pension assets
Summary
Commissioner Nakagiri presented analysis showing a potential $3.1 million to $16.1 million pension-asset gain over 10 years if the county issues a bond to prefund MERS liabilities; commissioners asked for more written detail before any decision.
Commissioner Nakagiri presented a slide-backed analysis urging the county to consider issuing a bond to prefund pension liabilities, saying the move would increase pension assets under most market scenarios. "In MERS expected market return, we would end up at the end of 10 years with $5,300,000 more in assets if we issued the bond," Nakagiri said during his presentation.
Nakagiri walked the board through three market scenarios used in a stress test—mid (6.93% return), bull (11%), and bear (3.8%)—and said the bond option produced higher pension assets in every case: $5.3 million in the mid case, $16.1 million in a strong market and $3.1 million even in a weak market. He also noted Livingston County's 2026 assessed property value of $18,000,000,000 and explained constitutional debt limits, saying the county would remain far below the 10% cap even after the proposed financing.
Nakagiri addressed Moody's treatment of pension liabilities and argued Moody's uses a more conservative discount (about 5.6%) than MERS's 6.93% assumed return, which increases reported pension debt. "When MERS says 6.93%, we have a pension debt of 44,000,000. But if our assets are only earning 5.6%, then our pension debt, according to Moody's, is 84,000,000," he said.
Several commissioners pressed for more documentation. Commissioner Groves said he wanted the presentation materials and underlying papers in writing before taking action. Commissioner (speaker 9) expressed concern that final bid and interest-rate assumptions could change the analysis, and asked for precisely laid-out paperwork rather than oral amendments. Commissioner Hoseman said now may be an opportune time to consider issuing debt if the county plans to do so in the near future.
The board did not take formal action on issuing a bond at the meeting. Commissioners asked Nakagiri to share his slides and supporting data and to return with final figures and any related procurement proposals. The discussion closed with multiple members indicating general interest but requesting additional written detail and a timeline for decision-making.
