Any objective observer with even a minimal understanding of pension funding has to recognize that if New Jersey continues funding pensions the way they have been doing there is a significant risk of insolvency within a relatively short period of time. But with the release of the June 30, 2014 actuarial valuation reports we now have an actuary for the state making this statement in bold print in the first paragraph of their comments:
This report summarizes the results of the actuarial valuation of the Teacher’s Pension and Annuity Fund (TPAF) as of June 30, 2014. This valuation reflects deviations from the anticipated State contributions for the fiscal years ending June 30, 2014 and June 30, 2015 incorporated in the 2013 valuation. These contribution amounts are much less than the expected phased-in contributions, representing no more than 18% of the full statutory contributions. Continued funding at these levels would put TPAF at significant risk of insolvency within a relatively short period of time. The impact of these deviations is discussed further below.
Milliman does the Teachers plan while Buck does the PERS, PFRS, State Police, Judges, and two closed plans. For the Buck reports, all signed by Aaron Shapiro, FSA, EA, MAAA, the only foray into opinion was one paragraph in the cover letter to the valuations:
In my opinion, the actuarial assumptions used are appropriate for purposes of the valuation and are reasonably related to the experience of the System and to reasonable long-term expectations. These assumptions were selected in accordance with applicable Actuarial Standards of Practice published by the Actuarial Standards Board.
Funded ratios for the State portion of the PERS and PFRS plans as well as the Judges’ plan are in the same ballpark as the TPAF plan yet no mention is made by Buck of any “risk of insolvency within a relatively short period of time” (for either the plans or Buck).