Unfunded pension liabilities are the dark cloud on the horizon of state budgets; a cloud totaling $4.1 trillion dollars for state-administered public pension plans, as SBS reported this year. Though they represent unavoidable fiscal debt, pension liabilities often slip under the radar when states tally up their spending, thanks to their status as "future payments" and accounting games. Aggressive pension reform is urgently needed in almost every state.

A recent group of studies by the GAO and Fed show how dire the situation really is.  Read about them here.

Courts are weighing in on what pension reform is feasible. Check out our monthly pension litigation update here.

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    • HEADLINES: Alaska, California, Colorado, Connecticut, Delaware, Florida, Illinois, Hawaii, Iowa, Louisiana, North Carolina , Pennsylvania, Vermont, West Virginia, Massachusetts , New York

      Williams Report - November 17, 2015

      State Budget Solutions | by Bob Williams | November 17, 2015

      Join us on Twitter by following @StateBudgets and tweeting with the hashtag #SBSbob. 

    • HEADLINES: Alabama, California, Connecticut, Georgia, Illinois, Colorado, Nebraska, North Carolina , Oregon, Pennsylvania, South Dakota, Virginia, Washington

      Williams Report - November 10, 2015

      State Budget Solutions | by Bob Williams | November 10, 2015

      Join us on Twitter by following @StateBudgets and tweeting with the hashtag #SBSbob. 

    • HEADLINES: Illinois, Pennsylvania, Alabama, New Hampshire , North Carolina

      And Then There Were Two

      State Budget Solutions | by Sarah Curry | November 9, 2015

      It is now past time for officials in these last two states to overcome political their differences, and use fiscally responsible means to support the functions of state government today and for generations to come.

    • HEADLINES: Alabama, Arkansas, Idaho, Illinois, Michigan, New York, Ohio, Pennsylvania, Washington, Wisconsin, Alaska, California, Connecticut, Kansas, New Jersey, Oklahoma

      Williams Report - October 6, 2015

      State Budget Solutions | by Bob Williams | October 6, 2015

      Join us on Twitter by following @StateBudgets and tweeting with the hashtag #SBSBob. 

    • HEADLINES: Alabama, Alaska, Arizona, California, Colorado, Delaware, Florida, Illinois, Louisiana, Maryland, New Jersey, New York, Oklahoma, Pennsylvania, Utah, Rhode Island, Massachusetts

      Williams Report - September 29, 2015

      State Budget Solutions | by Bob Williams | September 29, 2015

      Join us on Twitter by following @StateBudgets and tweeting with the hashtag #SBSbob.

    • HEADLINES: Alabama, Alaska, Arkansas, Connecticut, Florida, Illinois, Minnesota, Missouri, New Hampshire , North Carolina , Oklahoma, Pennsylvania, Tennessee, California

      Williams Report - September 22, 2015

      State Budget Solutions | by Bob Williams | September 22, 2015
      Join us on Twitter by following @StateBudgets and using the hashtag #SBSbob.
    • HEADLINES: Alabama, Arizona, Arkansas, Connecticut, Illinois, Kansas, Louisiana, Missouri, North Carolina , Ohio, Pennsylvania, Rhode Island, Virginia, California, Kentucky, New Jersey, Texas, Utah

      Williams Report - September 8, 2015

      State Budget Solutions | by Bob Williams | September 8, 2015

      Join us on Twitter today, by following @StateBudgets and using the hashtag #SBSbob!

    • HEADLINES: Alabama, Alaska, Colorado, Connecticut, Florida, Illinois, New Hampshire , New Jersey, North Carolina , Pennsylvania, Oregon, Maine , New York

      Williams Report - September 2, 2015

      State Budget Solutions | by Bob Williams | September 2, 2015

      Join us on Twitter today, by following @StateBudgets and tweeting with the hashtag #SBSbob! 


      Now Is the Time for Pension Reform

      State Budget Solutions | by Sarah Curry | August 27, 2015

      The future of public pension plans in America may seem bleak, but all hope is not lost.

    • HEADLINES: Alabama, California, Illinois, Missouri, New Jersey, North Carolina , Pennsylvania, Tennessee

      Williams Report - August 25, 2015

      State Budget Solutions | by Bob Williams | August 25, 2015

      Join us on Twitter today by following @StateBudgets and tweeting with the hashtag #SBSbob!

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      Pension Markets in Focus: Pension fund assets hit record USD 20.1 trillion in 2011 but investment performance weakens

      The Organisation for Economic Co-operation and Development | by André Laboul | September 27, 2012

      Recent years have witnessed intense pension reform efforts in countries around the globe, often involving an increased use of funded pension programmes managed by the private sector. These funded arrangements are likely to play an increasingly important role in delivering retirement income in many countries and privately managed pension assets will play an increasing role in financial markets, notably as a source of long-term savings.

      Published annually since 2005 by the The Organisation for Economic Co-operation and Development  (OECD) Directorate for Financial and Enterprise Affairs, Pension Markets in Focus provides accurate, comprehensive, comparable and up-to-date statistics to help policy makers, regulators and market participants measure, compare and evaluate programme developments and country experiences globally.




      The Revenue Demands of Public Employee Pension Promises

      by Robert Novy-Marx and Joshua Rauh | September 16, 2012

      Calculation of the increases in contributions required to achieve full funding of state and local pension
      systems in the U.S. over 30 years. Without policy changes, contributions must increase by a factor of 2.5, reaching 14.1% of the total own-revenue generated by state and local governments.
      This represents a tax increase of $1,385 per household per year.

    • RESEARCH: New York

      Iceberg Ahead

      Empire Center for New York State Policy | by E.J. McMahon | September 5, 2012

      New York taxpayers spend billions of dollars a year on health insurance coverage for retired state and local government employees, many of whom are too young to be eligible for Medicare. But the mounting "pay-as-you-go" bill for retiree healthcare is just the tip of a much larger iceberg. Thanks to a new government accounting standard, the true cost of this long-term entitlement is finally emerging from the depths of state and local finances.


      The Public Pension Crisis

      Boston Univ. School of Law, Public Law Research Paper | by Jack M. Beermann | August 27, 2012

      Unfunded employee pension obligations will present a serious fiscal problem to state and local governments in the not too distant future. This article takes a looks at the causes and potential cures for the public pension mess, mainly through the lens of legal doctrines that limit public employers' ability to avoid obligations.


      Retirement Plan Reform and Intergenerational Equity

      National Conference of State Legislatures | by Girard Miller | August 27, 2012

      Girard Miller's presentation at the National Conference of State Legislators in Chicago August 2012.


      Wall Street Feeds and The Maryland Public Pension Fund

      Maryland Public Policy Institute and the Maryland Tax Education Foundation | by Jeff Hooke and Michael Tasselmyer | August 10, 2012

      If public pension fund assets were indexed to relevant markets rather than actively managed, the public pension systems in Maryland and across the united States would save enormous amounts of money on fees, without undue harm to investment performance.


      Pensions and Retirement Plan Enactments in 2012 State Legislatures

      National Conference of State Legislatures | by Ron Snell | August 1, 2012

      This report summarizes selected state pensions and retirement legislation enacted in 2012.


      State Defined Contribution and Hybrid Retirement Plans

      National Conference of State Legislatures | by Ron Snell | August 1, 2012

      This report describes state retirement plans that depart from the traditional public sector model of defined benefit (DB) plans.


      Links: State and Local Government Pensions and Retirement Internet Resources

      National Conference of State Legislatures | August 1, 2012

      This document provides links to resources provided by other organizations on state pensions and retirement issues. Also included are links to many state-specific studies from recent years, which constitute important contributions to the national debate on public retirement systems' structures and funding.


      'GASB won't let me'-- A false objection to public pension reform

      The Laura and John Arnold Foundation | by Robert Costrell | June 25, 2012

      It might seem improbable that huge unfunded liabilities would be proffered as the reason not to adopt alternatives designed to prevent new unfunded liabilities. And yet, this claim has effectively stymied reform in state after state.

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    • SOLUTIONS: Kentucky

      Future Shock Solutions

      The Bluegrass Institute | by Lowell Reese | April 8, 2013

      The goal is to enact systemic change and create a climate for long-term solvency for Kentucky's public pensions. This requires changing the very structure of the system while providing the minimum amount of one-time immediate funding to stave off bankruptcy in the state employees’ fund. Steps also must be taken to set in place policies that will enable the commonwealth to avoid such pension crises in the future.


      Why government employee collective bargaining laws must be reformed now

      State Budget Solutions | by Bob Williams | December 5, 2012

      There are three important lessons from the Wisconsin collective bargaining battles over the past eighteen months:

      1. The power of the government-sector unions and their impact on elections is greatly overestimated. With the November 2012 victory for  Senate Republicans to regain control of the Wisconsin Senate,  government employee union  suffered their sixth  major defeat since March 2011.

      2. When given a choice, government employees will quit their union in large numbers.

      3. Government employees' salaries and benefits, particularly pensions, are financially unsustainable in most states and collective bargaining reform is needed.


      How to Prevent Future Pension Crises

      by Cory Eucalitto | November 1, 2012

      The time for state and local governments to offer defined contribution retirement plans that protect both taxpayer dollars and public employee retirement security is now.

    • SOLUTIONS: California

      Reform Before Revenue: How to Fix California's Retiree Health-Care Problem

      The Manhattan Institute | by Stephen D. Eide | October 31, 2012

      This paper examines the ongoing fiscal crisis caused by health-care plans for retirees (known as "other post-employment benefits," or OPEB) in one of the hardest-hit states, California, and outlines necessary reforms that should come before tax increases or cuts to government services.

    • SOLUTIONS: California

      Rising Pension Costs Threaten Cities’ Ability to Provide Services

      Hoover Institution of Stanford University | by Chuck Reed | October 16, 2012

      In June 2012, nearly 70% of San Jose voters approved "Measure B" - a set of pension reforms that the City Council placed on the ballot after more than 8 months of negotiations with our employee unions.

    • SOLUTIONS: North Carolina

      Reforms Needed for North Carolina's Ailing Pension System

      Civitas Institute | by Brian Balfour | September 12, 2012

      In numerous measurable ways, North Carolina's pension benefits are more generous than those offered in the private sector and most other states. Financial and demographic trends point toward rapidly increasing obligations in the near- and long-term future. Sensible reforms that bring North Carolina's pension benefits more on par with those of other states and the private sector are needed to avoid a massive taxpayer bailout of the pension fund.


      Solutions to the public pension crisis

      State Budget Solutions | by Bob Williams | August 1, 2012

      Public pensions at the state and municipal levels are unsustainable in their current form.  State Budget Solutions' recent study by Andrew Biggs found that public pensions are underfunded by $4.6 trilion. Here we offer solutions to the pension crisis

    • SOLUTIONS: Maine

      Unfunded Government Employee Pension Liabilities Reform

      The State of Maine | December 7, 2011

      Proposal for reforming Maine's pension plans, including freezing pensions for three years (2011 - 2013), identical to the state employee salary freeze, and ensuring reasonable increases in pensions after that, close to the historical norm of 2.8% annually, based on CPI (inflation), but capped at 2% (currently capped at 4%).


      Creating a New Public Pension System

      The Laura and John Arnold Foundation | by Josh B. McGee, Ph.D. | December 5, 2011

      Sound pension reform meets four general criteria: (1) establish transparency with respect to the true cost of the benefits promised to public employees; (2) mandate that the pension plan sponsor pay the full cost of accrued benefits each year; (3) mandate that the pension plan sponsor pay down the unfunded accrued liability over a reasonable time horizon and (4) improve the generational equity, portability and security of benefits for public employees.

    • SOLUTIONS: Virginia

      Pension Plan Reform in Virginia

      The Thomas Jefferson Institute for Public Policy | by Robert C. Carlson | December 2, 2011

      Paper suggesting Virginia move toward a combined retirement program that includes partially a defined benefits program and added to this should be a defined contributions program. Such a balanced system would make the Commonwealth’s costs lower and more predictable while providing attractive benefits to employees.

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