What Price Pensions?
With memories of the market crash still fresh, however, commissioners were wary. "We were asked to make a decision in May," says Rabhi. "But it's easy to get carried away, so we pulled it until July." At that point, the board ruled out a related proposal to borrow money to cover an anticipated shortfall in next year's operating budget. And by the time McDaniel unveiled her budget in October, bonding for benefits was not included.
The concept of borrowing money to invest is still on the table, however. To Rabhi, the potential benefit is simple: "We won't have to ask taxpayers for additional money to cover unfunded liabilities."
"In the best-case scenario, we'd have a surplus of funds in the trust and at end of twenty-five years [would] have money to give back to citizens," says LaBarre. "I'm not saying it's likely."
Neither does Rabhi. "Bonding is inherently risky. If you borrow money to invest, and if the return isn't what you expect--if there're a couple years of recession in the beginning--it'd be hard to recover from." The board chair doesn't close the door entirely, saying that "bonding is an option we'll be looking at it in the next months." LaBarre, though, doubts the votes are there to pass it--and hints that he won't support it, saying, "I get very nervous when we're depending on market performance to save our skin."