Augmenting the research of www.publicfundsurvey.org and focusing on hard numbers regarding assets valued at market, payouts, and contributions this summary of 110 state retirement systems with valuations readily available provides a better picture of the future of the public retirement system without the distortions of inflated ‘actuarial’ asset values and interstate variations in actuarial assumptions.
Public employees have more in common with each other (lifetime health benefits for a start) than artificial distinctions like which state they come from or which actuary they use to value their liabilities would lead you to believe. My methodology approximates the overall liability of my own state, New Jersey, which is trending toward an ‘official’ accrued liability of $150 billion as of June 30, 2010 (it was ‘officially’ $135 billion as of 6/30/09). To get my funded percentage (Bury Ratio) I divide the total market value of assets by the sum of (a) benefits being paid by a factor of 10 and (b) active employees over retirees times the same benefits being paid by a factor of 5. With longer life expectancies for those with lifetime medical insurance and politicians unwilling to significantly challenge the status quo, it could be argued that 12 and 6 respectively would be more realistic factors which would lower the Bury Ratio for all plans to 55.04% from 66.05% but we’ll get into that later. For now, here is the spreadsheet:
Click below to open up a separate file:
statepensions.xls
Microsoft Excel sheet [51.0 KB]
The Payout Ratio is the value of benefits being paid over the market value of assets and provides an indication as to how long each plan may have left
assuming no significant departure from current funding streams.
Look for a series of blogs over the next few weeks analyzing these numbers, with a special emphasis on New Jersey, in conjunction with the rollout of this website. Below is a listing of links to the underlying valuation reports.
Arkansas
Arizona
California
Colorado
Public Employees Retirement Association
Georgia
Idaho
Louisiana
State Retirement and Pension System
Massachusetts
Michigan
Missouri
Montana
Nebraska
New Mexico
Firemens and Rescue Squad Workers
North Dakota
Ohio
Oklahoma
Employees Retirement System (ERSRI)
South Dakota
Tennessee
Consolidated Retirement System
Texas
Law Enforcement and Custodial Officer
Vermont
Virgina
Posted by openactuary on April 14, 2011 at 11:11 pm
Hi John,
Do you have a copy of the state data spreadsheet that contains actuarial liability numbers? I plan to load those data into R and see if I could create charts to highlights some of the points you made. This is both a learning exercise for myself as well as sharing information with the public. Thanks.
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