How Bad Is the Pension Problem?
05/26/2011 - Well-publicized crises in Illinois and New Jersey may have given public systems a bad reputation, but in reality, the vast majority of state and local government programs are not on the verge of collapse.
"The public pension community is not in a state of crisis," says Keith Brainard, research director at the National Association of State Retirement Administrators. "Some plans face larger challenges than others, but it varies by plan."
Overall, state public pension programs were nearly 78 percent funded in 2009, according to the Pew Center on the States. While that figure is down from 84 percent funded in 2008, experts say the decline isn't cause for panic. "Seventy-eight percent is a number we're very comfortable with," says Hank Kim, executive director at The National Conference on Public Employee Retirement Systems
"The outlook is good," says Kil Huh, director of research at the Pew Center on the States. "We've seen strong market returns and that's good news for the states because it will help them get to a healthier level of funding over time. It's still going to take a number of years to get back to pre-recession levels, but they are on the way up."
Read the full article at usnews.com.
- Public Sector Retirement Systems