Archive for the ‘Public Pensions – General’ Category

No Will on Pension Reform

In plugging his new book George F. Will made the point:

I now have the book and Donald Trump is indeed not in the index. What does appear (once) is the word ‘pensions’ on page xxx.

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Consolidating Illinois Pension Problems

What can be done with all those badly funded Illinois public pension plans? A task force says to merge them and they put out a report on why it makes sense to them that Mary Pat Campbell debunked nicely including this note:

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Funded Status of Local Pensions per CSLGE – 2018

Based on an analysis of 190 major pension plans (114 state and 76 local) that represent over 95 percent of total U.S. state and local pension assets and membership, the Center for State and Local Government Excellence (CSLGE) released a brief concluding:

Fundamentally, the path of the funded ratio for public plans depends upon the growth of actuarial assets relative to the growth of actuarial liabilities. Liability growth slowed dramatically from 2001 to 2018, but still exceeded asset growth over the period – driving down the funded ratio from 103 percent in 2001 to 73 percent in 2018. While more stringent funding methods would have modestly improved the trajectory of plan assets from 2001 to 2018, significant change requires also using a lower assumed return.

Nothing alarming here (though significantly less upbeat than the last update) but that might have more to do with CSLGE’s funding than those of the plans. A footnote accounts for that rosy 73 percent figure:

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Moody’s Take On State Pension Liabilities

According to a research announcement released this week by Moody’s:

US states’ adjusted net pension liabilities (ANPL) declined in fiscal 2018 reporting due to healthy investment returns the prior fiscal year, Moody’s Investors Service says in a new report. Continued favorable investment returns, along with a rise in interest rates, will lead to another modest decline in fiscal 2019 reporting, before pension liabilities jump up again the following year.

The full report is only available to subscribers but they did release the names and ANPLs of some states and (after estimating state own-source revenues from this site and assuming one-half as the state portion) here is how those states stack up as ranked by highest burden:

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Governing Funding Ratios

The Tax Foundation picked up on recently released data from The Pew Charitable Trust on funded ratios of state pensions (based on data reported by the states themselves) and came up with a handy chart:

State pension plan, pension plans, pensions by state, pension fund

The Tax Foundation did the same thing a year ago and in most cases the ratios went up, significantly in some states that also happened to get new governors around the time the new numbers were calculated.
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A Generation of Sociopaths (1): The Brief Triumph of Long Retirement

Bruce Gibneys’ first book had a chapter (12) on the various pension crises that I kick off (what may be a series) with:

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How Do Public Plans Value Their Assets?

The Center for Retirement Research at Boston College sought to answer that question in a new brief that “provides an update on the investment performance of U.S. public pension plans since 2001 and introduces new Governmental Accounting Standards Board reporting on the fair value methods of pension plan assets.”

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