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Committee discusses PERS funding pressures and past bonds as potential tools
Summary
Committee members and staff reviewed PERS unfunded liability concerns and prior bond strategies; staff described how bonds were used to reduce liabilities and warned of risks if market returns underperform relative to assumptions.
Committee members asked about the district's PERS exposure and whether bond mechanisms remain an option. Staff explained that PERS liability is apportioned across the statewide payroll pool and not by individual employees, and described past bond actions that provided relief: the district issued PERS-targeted bonds in 2003 and again in 2021 to address unfunded liabilities.
Staff cautioned that bonding carries risk if investment returns fail to meet assumptions or payroll grows unexpectedly. "What can happen: the market doesn't grow, or your payroll grows faster than they anticipated. And that's when you go backwards," the staff presenter said. The committee discussed the trade-offs of bonding and the district's conservative budgeting posture to avoid exposure.
