Two Port Moody school trustees are against a plan to ramp up payments to cover a $25-million liability for future health and retirement benefits for School District 43 employees.
SD43 is one of only five B.C. school districts that has not paid down the obligation for Employment Future Benefits (EFB) dating back to an accounting change in 2004, when the district was required to set aside funds for promised obligations for vacation, sick days, retirement incentives, pensions and health benefits earned by employees.
Prior to 2004, when the province moved to generally accepted accounting principles, SD43 and other jurisdictions had more flexibility in recording the obligation for future benefits and setting aside funds. Over the years, the district has been meeting its current obligations as well as paying interest and service costs so the liability doesn't increase and has managed to whittle it down from the original $40 million.
But with $25 million remaining on the books, trustees agreed Tuesday to review the liability annually and come up with a payment plan to fit the district's budget.
ROBUST PLAN NEEDED
"If we don't come up with a robust plan, a plan could be imposed on us," SD43 secretary treasurer Mark Ferrari told trustees.
Not paying down the liability "radically" was "shortsighted," said Anmore-Belcarra trustee Kerri Palmer Isaak while Port Coquitlam trustees Michael Thomas and Judy Shirra wanted to make sure trustees retain control over the amount of cash put towards the liability instead of establishing a minimum payment of $500,000 a year, using surplus benefit funds, as recommended by staff.
"This is money we're paying ourselves," Thomas said.
But PoMo Trustee Keith Watkins, who was one of the draftees of the original 2004 motion to retire the unfunded employment future benefit obligation over 20 years, said the need to set money aside for the obligation wasn't urgent, as the entire obligation would only have to be paid out if the district ceased to exist, and setting aside the funds was only being done to make the province and the banks happy.
"We're saying there's a compelling reason to put [unused benefits] towards the unfunded future liability," Watkins said, adding that he hasn't heard from the public that it's is a big problem.
Other trustees, including Coquitlam's Diane Sowden, offered solutions such as motion amendments to make the plan more acceptable to trustees or asked questions, such as trustee Carol Cahoon did, with Barb Hobson saying she couldn't support a motion that didn't give trustees more say in the matter.
REASONABLE COMPROMISE
Chuck Denison agreed: "I think we need to balance our needs, we need to be fiscally responsible and balance the needs of the classroom," adding that the amended motion giving trustees more say and flexibility in the payback plan was a "reasonable compromise."
Lisa Park joined Watkins in voting against the plan but was silent throughout the discussion and didn't explain her opposition.
