Municipality Legacy Costs

Funding the Legacy reportLegacy costs are one of the biggest financial challenges facing municipalities in Michigan. The two biggest legacy costs are pensions and other post-employment benefits (OPEB), specifically retiree healthcare. While pension obligations have been clearly defined and understood for decade, much less is known about retiree healthcare obligations.

A new Michigan State University Extension study examines 311 municipalities that offer OPEB, the scope of those benefits, compare the benefits to pension liability and other governmental debt, and quantifies the impact OPEB will have on municipal budgets.

Among its findings, the study found that the net unfunded OPEB liability is $12.7 billion. Detroit alone has an unfunded liability of $4.9 billion.

Read the report

Data tables for 311 municipal units

*Originally published 3-13-2013

*Update published 3-14-2013