The City of Charlotte faces several challenges in 2019 and beyond in addressing challenges to maintaining fiscal stability. Of primary concern is the need to prepare a corrective action plan to address the Department of Treasury’s finding that the City’s pension plan and retiree health insurance plan are underfunded.
As of the most recent actuarial valuations, the unfunded liability for pension exceeds $10 million while the unfunded liability for retiree health insurance is just under $2 million. Required annual minimum contributions to the pension system are expected to increase from just under $900,000 to more than $2.2 million over the next 20 years before declining. Required annual contributions to meet retiree health insurance obligations are expected to increase slightly above the current $135,000 before gradually declining over the next 30 years.
In addition, the City must identify means to address the challenge of aging infrastructure. Of particular note is the estimated $50 million to $75 million price tag for street reconstruction and rehabilitation necessary to return streets to good or excellent condition. Simply put, we are investing too little to effectively address this problem over any reasonable time frame.