Subsidy Cap, Tobacco Tax Hike Eyed To Cover W.Va. Retiree Costs

CHARLESTON, W.Va. — A funding gap for public retiree health care is prompting West Virginia lawmakers to consider raising tobacco taxes and capping retiree subsidies.

A Senate bill introduced Monday also aims to ease concerns that prompted county school boards to sue unsuccessfully over retiree costs last year.

The measure focuses on other post-employment benefits, or OPEB. West Virginia estimates it lacks nearly $7 billion of what it’s promised in these benefits, mostly health coverage.

This liability led the state to end coverage subsidies for employees hired after June 2010. The bill keeps that and caps existing subsidies at $150 million annually.

The bill proposes tax increases on cigarettes and other tobacco products that are also pending in a separate measure.

source: The Associated Press

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