For two decades, we’ve been reporting on OPEB, the acronym for Other Post Employment Benefits in addition to retiree pension benefits. OPEB consists almost entirely of future retiree health care costs.).Why have we been reporting on OPEB for such an extended period? To answer that question, we must go back to 2004. It was then that we saw the spotlight being focused on the issue of future retiree health care costs by a private sector board, called GASB (Government Accounting Standards Board).
GASB had finalized a new accounting rule (Standard 45) for state and local governments, entitled Other Post-Employment Benefits or OPEB. It required them to disclose on their financial papers the future costs of post-employment benefits, including retiree health care costs.
This new OPEB rule extended beyond the reporting of these costs. State and local officials were also expected to show how they intended to pay if off.
Three years later (2007), the State Retiree Benefits Trust Fund (SRBTF) was created as Section 24 of the state group insurance law (Chapter 32A), to “solely meet liabilities of the state employees’ retirement system for health care and other non-pension benefits for retired members of the system”. With those words, the SRBTF became and remains the Commonwealth’s OPEB trust whose funds are invested by the state PRIM (Pension Reserves Investment Management) Board.
Some four years later (2011), SRBTF’s scope expanded when the local OPEB law was amended, allowing local governments to transfer their OPEB funds into the SRBTF. It’s noteworthy that prior to the 2011 change in the law, local governments were creating their own OPEB trusts. They did so either with special legislation or adopting the local option law, sponsored by Mass Retirees and originally enacted in 2008 that allows local governments to establish their own OPEB trust.
LOCAL PARTICIPATION & ASSET VALUE INCREASING
The Town of Hingham was the first to participate in the SRBTF, but today it isn’t alone with the number of local participants having grown significantly. Currently there are over 80 local governments participating in SRBTF. See Table of SRBTF participating towns & cities below.
When we reported on the value of the SRBTF assets in the September 2021 Voice, we highlighted that it was approaching $2.5 Billion – in fact, at $2.48 Billion. Well now the Fund’s value has grown to $4.7 billion (as of May 2026) – an almost 90% increase in a relatively short period of time.
Of the $4.7 Billion currently in the Fund, $1.6 Billion comprises assets of the local participants. That represents one-third of the SRBTF assets being invested by PRIM.
