TOWNSEND -- The North Middesex Regional School District is considering options to combat a $48 million unfunded liability for health insurance over the next 30 years.

"In layman's terms, these are financial promises we've made that we need to keep," Chairman Susan Robbins said.

District treasurer Michael Hartnett briefed the School Committee on the shortfall Monday night and went over a series of options for gradually funding the costs.

The district is operating on a $1.7 million-per-year, pay-as-you-go model that Hartnett said will not meet the cost projections in the long run.

"If we wanted to continue to fund on a pay-as-you-go basis, we would have to start funding about $3.5 million a year in order to reach a point 30 years down the road where that $48 million goes away," Hartnett said.

He said options include starting to budget a higher cost for new employees while continuing the current model for current and retired employees, paying that higher cost for all employees, or choosing an amount to put toward a trust fund to cover the costs.

Hartnett said North Middlesex is not alone in not funding the shortfalls, with about 95 percent of school districts and communities across the state having similar problems.

Robbins said the committee would have to further discuss the issue at future meetings.

"At some point down the road, some future generation is going to be affected," she said. "There's going to be less money for education because of these health-care costs."

Committee member Jonna Clermont said the consequences of continuing on the current path could be too serious to ignore.

"Basically, it's a $48 million unfunded liability that could bankrupt us if we don't plan and save," Clermont said. "It's hard to do nothing when you see what's going to happen."

Committee member Rob Templeton said the district would be hard-pressed to allocate more money toward health insurance, especially with the looming costs of the North Middlesex Regional High School building project.

"We're having a hard time paying the $1.7 million, let alone doubling it to pay for a rainy day," Templeton said.

Hartnett offered no recommendation on which option the board should take, but said the decision should be made based on what the district can afford.

"We can't ignore it, so let's look it right in the eye and be reasonable and realistic, and decide what to do," Hartnett said.

The board did not vote on the issue, but will be consider it at its next meeting, scheduled for Sept. 23.

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