More than anything else the events of this week revealed exactly why the Jackson County Board of Supervisors hired Billy Guice. Campaign season can no longer be put on hold for incumbent Supervisors, who hired Guice to run interference for them, ultimately using Guice to throw their own political appointees under the bus in one last effort to save their jobs. The cost to the taxpayers for this political expenditure is $345,000 and counting. I’m fairly certain the retirees that are fixing to get screwed are not very happy with Guice’s recounting of the obvious for the Sups, which has been covered in detail on both these pages as well as the Sun Herald for the past 7 plus months.
Let’s start with the Sun Herald, which was excluded from Bronco Billy Guice’s Wild West Show, a fact they were clearly unhappy about:
Jackson County has spent $345,000 on SRHS probe ~ Anita Lee
Jackson County taxpayers should have saved their money ~ Sun Herald Editorial Board
A short snippet is in order but the entire Op-Ed is fine reading:
Looks as though the Jackson County Board of Supervisors brokered a deal for the taxpayers to buy a wheelbarrow full of fool’s gold for the low, low price of $345,000.
A subscription to the Sun Herald would have saved the taxpayers a ton of money — we don’t see anything in the report about the investigation into the Singing River Health System pension fund that hasn’t been covered in the paper.
Even better Jackson County taxpayers could have saved the S/H subscription and read up on things right here on Slabbed. 😉
Moving right along WLOX got in on the show with the following report which uncritically parrots Guice’s press release that ran in the Mississippi Press, which coincidentally is also a public relations prelude to screwing the SRHS retirees in my opinion:
Poor Billy Guice had no clue he needed firefighting training before taking on this $345,000 no-bid CONsulting job with Jackson County as we turn our attention next to the Jackson County press release disguised as a trio of new reports which ran yesterday in Pravda, err, I mean the
Mississippi Alabama Press:
- SRHS pension exclusive: Here are answers to 10 common questions regarding the system, its future and its pension ~ April Havens
- SRHS pension exclusive: System ‘actively misled’ employees, retirees about health of pension plan ~ April Havens
- SRHS pension exclusive: Why did system first stop contributing to pension plan? ~ April Havens
Finally it would not be Jackson County politics without some political incest:
So let’s review. The County Supervisors were asleep at the switch when their political appointees at Singing River Hospital pursued an ill advised business strategy of pouring millions of dollars into brick and mortar projects that was funded in part by taxpayer guaranteed debt and in part off the backs of the participants in the pension plan. Worth noting is the fact that Billy Guice appears to be talking out of both sides of his mouth when he terms the assertion that SRHS was required to make annual contributions to the pension plan “a misconception”. Here is a snippet via Guice and April Havens lined above:
Based on the pension agreement that established the plan, SRHS was only required to contribute when actuarial calculations showed it was necessary.
No contributions were made from 2002-2005, yet the fund remained funded at more than 90 percent.
So at what point did a contribution to the plan become actuarially necessary? Let’s again quote Billy Guice and April Havens:
By 2008, however, the pension was funded at only 73.9 percent — partially due to the market losses — and the liability catapulted to $44.4 million. That year, SRHS put in another $2.6 million.
By 2009, the pension was funded even less at 72.3 percent, and the unfunded liability had grown to nearly $47 million.
At the time that huge funding gap was discovered, Guice said SRHS was already running tight on money in operations, so leaders decided to make a partial payment of only $2 million in 2009.
Guice said when it became apparent that the health system could never catch up, he believes they gave up.
Seems to me management made an election to short the plan that does not exist per Guice and his clear-up of the funding misconception. Remember it was OK to short the plan from 2000 to 2005 because it was funded at over 90%. So exactly what is the unfunded liability threshold that would require contributions? 80%? 70%? 40%? You folks get the idea. Even better was Guice by implication throwing former trustee Morris Strickland under the bus by saying the plan did fine in its conservative investments until the time the decision was made to steer the plan into riskier investments back in 2007.
Finally are we noticing a trend with political corruption scandals and other politically made disasters? I am seeing a trend to use the opportunity presented by said disaster to stuff big money into the pockets of politically connected consultants. We saw it at DMR with the Horne CPA contract and we’re seeing it again in Jackson County in my opinion thus the taxpayers get raped twice instead of just once. And the military slang acronym used in the post title sums it up.
Worse, by setting sail on a course that runs again the prevailing headwind of hospital system consolidation brought on by the Affordable Care Act, made worse by Gov. Phil Bryant’s refusal to accept funding to expand medicaid to cover the working poor, the Sups and management at SRHS may well be insuring that whatever value is left in the Singing River community hospital system will be destroyed longer term. The potential here for retirees to lose a portion of their pension followed by the Jackson County taxpayers being stuck with the bill for all the legacy liabilities associated with the bad financial decision making is very real.
Luckily for the folks in Jackson County the primary election is 39 days away. In the meantime while the Sups are telling the hospital to cut to the bone they should take some of their own advice and start with their own consultants.