Released on = March 21, 2007, 12:14 pm

Press Release Author = Laura P. Wright, BlabberMouth PR

Industry = Government

Press Release Summary = Across the U.S., state and local governments are scrambling
to determine how they will deal with the future costs of employee healthcare and
other non-pension benefits under the new Government Accounting Standards Board
(GASB) Statement No. 45 rules. It’s clear that the pay-as-you-go strategy currently
in use is a recipe for disaster, according to national investment management and
financial advisory firm Sage Advisory Services. However, pre-funding those
obligations may offer a real solution.

Press Release Body = FOR IMMEDIATE RELEASE

Pre-funding OPEB Obligations Can Help Governments Cope with GASB 45 Standards, Says
Sage Advisory

AUSTIN, Texas – March 21, 2007 –Across the U.S., state and local governments are
scrambling to determine how they will deal with the future costs of employee
healthcare and other non-pension benefits under the new Government Accounting
Standards Board (GASB) Statement No. 45 rules. It’s clear that the pay-as-you-go
strategy currently in use is a recipe for disaster, according to national investment
management and financial advisory firm Sage Advisory Services. However, pre-funding
those obligations may offer a real solution.

“Today, GASB 45 OPEB (other post-employment benefit) liabilities may total in excess
of $1 trillion across the United States,” says Robert G. Smith, Sage Advisory
president and CIO, “and most of them are unfunded. Retiree healthcare programs
typically represent more than 90 percent of the costs of non-pension benefits. As
healthcare costs rise and retiree populations expand, the financial ability to fund
obligations on a pay-as-you-go basis will lead to enormous costs on the back end,
easily double or triple today’s expenses.”

“Pre-funding OPEB obligations now allows funds to earn interest and investment
returns that can be used to offset future retiree costs,” he explained.

In 2004, when GASB issued Statement No. 45, it required state and local government
employers that provide healthcare to account for and report the cost of OPEB
annually, as well as related outstanding obligations and commitments. The largest
employers are required to meet this standard beginning this year. Medium-sized
employers are given a one-year extension.

For employers with unfunded OPEB obligations, this disclosure requirement threatens
to damage their bond rating and reputation among potential investors.

“GASB 45 doesn’t require that OPEB obligations be pre-funded, but by taking this
step, public entities may benefit front the ability to apply higher discounts
valuation rates and report lower liabilities,” says Smith.

For more information on the GASB 45 issue, Sage Advisory Services offers a webcast
titled \"Gasping Over GASB 45\" on its website at
http://www.sageadvisory.com/r_e/webcasts/index.php. The password is “irving.”

About Sage Advisory Services
Founded in 1996, Sage Advisory Services is a national investment management and
financial advisory firm that provides institutions and high-net-worth individuals
with customized products and services including fixed-income and equity portfolio
management, asset/liability analysis and structured portfolio solutions designed to
minimize financial risk and increase returns. Sage is one of the fastest growing
companies in Central Texas, with an AUM (assets under management) growth rate of 20
percent per year over the past five years. Its consistently high performance record
is a result of its proprietary investment process, as well as its dedication to
offering clients exclusive representation by senior-level managers with global
expertise.

Sage’s investment management strategy employs a top-down approach to market
analysis, taking into account broad domestic, international and economic trends when
applying portfolio management strategies. And while most investment management firms
have limited experience with exchange-traded funds, Sage offers an in-depth
understanding of ETFs and a highly successful five-year performance record managing
ETF portfolios. Reflecting its commitment to providing education and transparency,
Sage provides frequent access to up-to-date information on investment fundamentals,
market trends and economic issues affecting client investments, and 24-hour
real-time access to information about investment activity. For more information,
visit www.sageadvisory.com.

###

CONTACT:
Laura P. Wright
Blabbermouth PR
512-461-5777
laura@blabbermouthpr.com



Web Site = http://www.sageadvisory.com

Contact Details = Laura P. Wright
Blabbermouth PR
512-461-5777
laura@blabbermouthpr.com