TWENTY COUNTY SCHOOL SYSTEMS SUING STATE OVER MASSIVE LIABILITIES

(07/24/2009)

At least 20 West Virginia county school systems are taking the state to court to clarify who's responsible for massive liabilities for health care promised to public employees when they retire. The suit will clarify how that debt is to be reported on financial statements. This is reportedly an outgrowth of a new national standard for recording the cost of health benefits promised to public employees when they retire. The Legislature passed legislation that resulted in PEIA [Public Employees Insurance Agency] starting to send annual statements to school boards and other local governments informing them of their liabilities. Officials say the cost of promised benefits is currently estimated at $7 billion statewide, a figure that is growing. The state has yet to require counties to fully pay the liabilities, which can be millions of dollars each year for the larger county school systems. Most county systems say they will bankrupt if the issue is pressed. Nineteen counties have formally announced they will join in the suit - Barbour, Cabell, Clay, Harrison, Jackson, Marion, Mineral, Morgan, Nicholas, Raleigh, Randolph, Ritchie, Roane, Summers, Webster, Wetzel, Wirt, Wood and Wyoming, according to a list provided by attorney Howard Seufer Jr. According to Kanawha County's school board attorney Jim Withrow, they too will likely join the suit.

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