What is OPEB?OPEB stands for Other Post-Employment Benefits.
What does that mean? They are benefits that Wayland town employees will begin to receive at the start of retirement, i.e., healthcare premiums for health, dental, vision, prescription and life insurance and deferred-compensation arrangements, etc. The only thing they do not include is the pension benefit paid to the retired employee.
What's the big deal?The problem here in Wayland is that we have paid into this irrevocable trust $6,000,000 more than we needed to and no one, not even our Finance Committee, can explain how this happened, how, over a 4 year period $6M mades its way into this trust with no one having signed off on it. Click here for a graph that puts this in perspective.
Tell me moreThe Report of Wayland's Finance Committee (in the 2011 Annual Town Meeting Warrant, page 11) states: "The State has not mandated that communities begin payments toward OPEB; however, as part of our financial management plan, the Town has been making payments of approximately $1 million per year since FY2009."
Using the above "financial management plan" formula would put Wayland's OPEB trust at approximately $4 million as of FY2012. However, unbeknownst to the Finance Committee and taxpayers, someone - no one has claimed responsibility to date - transferred an additional $6M into this irrevocable trust. As you can see on pages 1, 3, 5 and 6 of the journal entries, the transfers of funds into OPEB for fiscal year 2011 were not signed off by anybody under "Submitted by". Who authorized these transfers? No one has taken responsibility for the transfer of this money.
But, isn't this a good thing that we've paid in advance?Would you pay your personal income taxes 6 years ahead of schedule?
Would you consider this to be sound fiscal management?
In four short years, during the worst economic times since the Great Depression, we were overtaxed by $6 million dollars. We have paid off 21% of an obligation in four years versus the required thirty years. This aggressive payment plan has put an undue burden on today's taxpayers. OPEB is no longer a liability on Wayland's books; it’s an ASSET (and likely the only municipality in the Commonwealth that lists OPEB as an asset)! This additional money was taken without the knowledge of the Finance Committee or town meeting.
Why weren't these payments amortized more fairly over the 30 year payment time frame? Who extracted so much money in such a short time span from taxpayers with no one noticing? This raises many questions about the town's frequent self-congratulatory claims of tight financial management.