In 2002, the Fresno County Board of Supervisors refinanced a pension bond to get a lower interest rate and lower short-term payments, but the deal will cost taxpayers $77.6 million.
The Fresno Bee reported:
“The pension expenses are for county workers whose costs are covered partly by state and federal dollars – such as social service department workers who handle public assistance programs. When the county refinanced its pension bonds in 2002, the 10 extra years of payments meant the ultimate expense would exceed the cost of the earlier bond by $77.6 million. The county expected that about half of that would be covered by state and federal agencies.”
Now, the U.S. Department of Health and Human Services has asked the county to pay to cover the additional costs that resulted from the refinancing, and the state has indicated it is in the process of billing the county, too. Together, the state and federal governments are expected to ask the county for approximately $37.7 million for the pension bond refinance costs.
The county is challenging the federal and state actions. (Source: The Fresno Bee, March 13.)