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  #71  
Old 01-14-2019, 04:29 PM
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Mary Pat Campbell
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MASSACHUSETTS

https://www.bostonherald.com/2019/01...r-5-2-billion/
Quote:
Massachusetts pension tension: Some payouts hit $350,000
More than 1,000 retirees get over $100g annually

Spoiler:
Tens of thousands of state pensions of up to $350,000 a year are straining the retirement system, forcing the Legislature to ask taxpayers for more cash to keep the system afloat.

A staggering 1,000-plus retirees earned $100,000 or more in pension pay last year — with former troopers, judges, provosts and school superintendents leading the way — with the total pension-fund liability at a budget-busting $5.21 billion.

It’s a trend one watchdog said is heading into the danger zone.

See the full state pension database here…

“These pensions are putting an enormous burden on the state budget,” said Greg Sullivan, a former state inspector general now with the Pioneer Institute. “It’s taking away money we need for roads, bridges and to fix the MBTA.”

Sullivan said the cost of footing the bill for these golden years has “skyrocketed” — forcing the state Legislature to pump $2.4 billion into that budget in 2018. He warned that the tab for this liability will climb to $11 billion by 2033.

“This is such a serious problem,” Sullivan added, “it’s become almost unrealistic.”

The 124,000-plus pension payouts studied by the Herald show former provosts, professors, prosecutors, teachers, social workers, toll collectors and prison guards collecting hefty checks:

Two former UMass Medical junior chancellors pulled down $347,000 and $338,000, respectively, last year. Both retired recently.
Ten retirees were close behind at more than $200,000 each last year, including William “Billy” Bulger, the brother of slain Southie mobster James “Whitey” Bulger. The former UMass president and onetime state Senate president took home $201,656 last year.
One man who retired in 1953 from “state service” was listed as collecting $12,200 last year. Others left state work in the 1960s, ’70s and ’80s and are still collecting checks.
Most retired public school teachers were paid about $50,000 last year, but the top earner in this category chalked up $149,000.
School superintendents and teachers from Athol to Wrentham had annual pensions of $209,000 to $400. (That was a teacher on Nantucket.)
Retired toll collectors, who had their jobs eliminated due to electronic tolling, clocked in at $61,000 and $56,000 a year, on the high side, to $9,959 in the slow lane.
Sullivan, who collects a $91,000 annual pension for his stint as an inspector general, said the culprit is the state’s growing payroll.


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As the Herald reported this week, the state payroll for 2018 was $7.74 billion. That figure has climbed 23 percent over the past five years. Yet the median household income for Massachusetts residents has gone up only 15 percent to $73,227 over the same period.
Gov. Charlie Baker’s administration said a timeline has been set to get the pension system under control, but it will take years.

“The Baker-Polito Administration has made progress to pay down the commonwealth’s long-term obligations like the unfunded pension liability. Under the current statutory funding schedule the final amortization payment will be made in fiscal 2036, four years before the statutory requirement,” said Julie Mehegan, spokeswoman for the Executive Office for Administration and Finance.

Until then, retired parole officers, jail guards, librarians, chauffeurs and janitors will need the Legislature to keep the payments coming.


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  #72  
Old 01-14-2019, 04:30 PM
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LOS ANGELES, CALIFORNIA

http://www.startribune.com/strike-or...ols/504265061/
Quote:
Strike or no strike, pensions problematic for LA schools

Spoiler:
LOS ANGELES — Strike or no strike, after a deal is ultimately reached on a contract for Los Angeles teachers, the school district will still be on a collision course with deficit spending because of pensions and other financial obligations.

School systems across California are experiencing burdensome payments to the state pension fund while struggling to improve schools.

The problem is especially acute for districts like Los Angeles Unified that will see a financial hit in part because of steadily declining enrollment.


As fewer students enroll, public schools get less in per-pupil funding from the state, said Helen Cregger, an analyst and vice president at the financial services company Moody's.

"Then comes the tradeoff between making good on pension promises and what you're capable of offering in salaries," she said.

The downward trend in enrollment is due to skyrocketing housing costs that keep families with school-age kids out of the city and the growth of charters — privately operated public schools that compete for students and the funds they bring in.

Los Angeles is among the school districts across California that are not well-positioned to manage the coming confluence of slower revenue growth, declining enrollment and rising pension contribution rates, according to a Moody's study published in September 2018.


The LA district's contributions to the state's two large pension plans — California State Teachers' Retirement System and the California Public Employees' Retirement System — amounted to about 5.5 percent of the budget in the 2014-15 school year. By last year, that number had climbed to nearly 8 percent, according to an Associated Press analysis.

The contributions ramped up quickly to chip away at plan underfunding and because of demographic trends: As retirees live longer, their lifetime pensions cost more. Meanwhile, the district is spending more on special education programs and seeing climbing health care costs.

Governing bodies in some places — though not LA Unified — have skipped pension contributions altogether to deal with other more immediate budget crunches, compounding the shortfalls. California's major plans are short largely because they did not reach lofty investment return targets.

David Crane, president of the advocacy group Govern for California, said there's nothing an individual school district can do about its rising pension costs. He said state aid — like a plan that new Gov. Gavin Newsom introduced Thursday in his budget proposal — could reduce the burden for districts, though.

Newsom, a Democrat, wants to make a $3 billion one-time payment to California's teacher pension fund on behalf of schools to help districts that are seeing more of their budgets eaten up by pension obligations.


Crane said districts can reach deals with teachers unions to eliminate or scale back paying for retiree health care. He said those costs are not needed because they're subsidizing care largely for people already eligible for subsidized coverage or Medicare.

"It's coming out of current teachers' pockets," Crane said, and will only get more expensive in the future. Cutting the post-retirement benefits, which cost the district $343 million last school year, could mean raises of more than $10,000 for each of the district's 26,000 teachers, he said.

LAUSD Superintendent Austin Beutner said he's "delighted" by the new governor's commitment to public education and added that it's the district's obligation to make good on current pensions.

"The work's been done, the benefits have been earned," he said. "We wish the state would give us a little more money to cover the actual costs of those benefits but we're committed, of course, to maintaining the pension system that's in place."

Many educators say they chose teaching over more lucrative professions because of the promise of a secure retirement, and they hammer at the moral argument that pensions are promises.


Walkouts by teachers last year in Kentucky schools were largely over the governor's plan to cut future pension benefits there. Former New Jersey Gov. Chris Christie and his state's largest union spent nearly his entire eight years in office battling over pensions.

Teachers are preparing to strike in Los Angeles on Jan. 14, where the union is pushing for higher salaries and more hiring despite warnings from the LA County Office of Education about potential deficit spending.

Since 2014, California schools have been required to contribute an increasing amount of money to secure the pensions of current teachers and to pay down unfunded liabilities for retirees.

In 2013, schools put in 8.25 percent of a teacher's earnings to help fund pensions. That rate will more than double to 19 percent by 2020.

United Teachers Los Angeles has made Beutner, an investment banker and former Los Angeles deputy mayor without experience in education, a lightning rod in negotiations. The union says Beutner and school board members who voted him in are trying to privatize the district, encouraging school closures and flipping public schools into charters.


Beutner's supporters say now more than ever the system needs someone with a business background and an understanding of budgets and the bottom line.

-----


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  #73  
Old 01-14-2019, 04:31 PM
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OMAHA, NEBRASKA

https://www.omaha.com/news/education...49e10750e.html
Quote:
What even is OSERS? Explaining the basics behind OPS's $771 million pension shortfall

Spoiler:
Until former OPS Superintendent Mark Evans arrived in Omaha, he admits he had never heard of OSERS. He wasn’t the only one. Most people in Omaha likely have never heard of the pension fund that’s now costing the school district a bundle. Here’s a quick OSERS primer.

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What is OSERS?
It stands for the Omaha School Employees’ Retirement System, and it serves staff and retirees in the Omaha Public Schools. It was established in 1909, decades before the State of Nebraska created pensions for the rest of the state’s teachers. It’s believed OPS is among just eight school districts nationally with its own pension fund. The others: New York City, Chicago, Washington, DC, Kansas City, Denver, St. Louis and St. Paul, Minnesota. That also makes OSERS one of the smallest public pension funds in the country.

Who is served by OSERS?
OSERS currently covers roughly 7,500 active teachers and staff members, and mails monthly checks to about 4,500 retirees.

Who runs OSERS?
Effective Jan. 1, 2017, the Legislature turned OSERS investments over to the Nebraska Investment Council, the agency that handles investments for statewide pension funds. Before that, the fund’s board of trustees and OPS school board determined investment policy. The board of trustees, hired chief executive and staff continue to administer retirement benefits. The trustees once had 10 members that included three members of the school board. It now has seven members: two outside business representatives, four staff representatives and the district superintendent. The staff representatives are elected by their class of employees, including one current retiree. The OSERS office is in the OPS headquarters building, 3215 Cuming St., where the trustees meet monthly. Its website is osers.org





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How do the finances of OSERS work?
OSERS is a defined benefit pension plan, meaning that the district promises vested members a specified monthly payment for life upon retirement, with the payment determined by a formula that takes into account earnings history and years of service. The financial success of the plan for years allowed OSERS to offer more generous benefits than the state teachers’ plan.

Benefits have since been scaled back by the Legislature to more closely conform with the state plan, though those already in the system at the time of the changes continue to receive the enhanced benefits. The average monthly retirement benefit in 2017 was $1,720. All OPS employees pay nearly 10 percent of their gross salary into the fund, a figure which is essentially matched by the district.

The state in recent years has also kicked in a small amount, equal to 2 percent of annual payroll. The money in the trust fund — currently nearly $1.3 billion — is held and invested. The return on those investments, plus the money paid in annually, are supposed to be enough to pay promised benefits into the future.

Can OSERS meet its obligations?
If annual actuarial evaluations find there is a significant shortage between current assets and projected returns and estimated long-term obligations, the district and its taxpayers are required to make additional payments into the fund. That’s what’s happening now, as the current projected shortfall of $771 million forced the district to make an extra $18.9 million payment this school year. OSERS is currently projected to meet only 64 percent of its future obligations, well below the 80 percent that is generally considered the minimum for a healthy fund. It will take years of enhanced payments and good investment returns for OSERS to get back to adequate levels of funding.

OPS's $771 million pension shortfall a product of 'mind-boggling' mistakes, World-Herald investigation shows
OPS's $771 million pension shortfall a product of 'mind-boggling' mistakes, World-Herald investigation shows
The 2009 OPS trustees
These 10 members served as trustees for the Omaha School Employees' Retirement System during key years when investments were shifted from the stock market to so-called alternative investments. The decisions meant the system largely missed the stock market rebound and got lower returns or losses from the alternatives, creating the shortfall Omaha Public Schools is trying to manage.


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  #74  
Old 01-14-2019, 04:32 PM
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NEW YORK
DIVESTMENT

https://buffalonews.com/2019/01/11/a...-fossil-fuels/
Quote:
Another Voice: State pensions need to divest from fossil fuels

Spoiler:
Will Comptroller Thomas P. DiNapoli, his Decarbonization Advisory Panel and the fossil fuel industry be able to sideline divestment as the best strategy to a clean energy future, stronger pension funds, and a last ditch attempt to stop carbon emissions before it is too late?

It has become clear recently that some fossil fuel companies have revived “green-washing” as the more effective path in keeping their increasingly exposed industry afloat. They appear to have acknowledged that in the long term fossil fuels are no longer a viable business. Their new goal is to make sure that their term for selling oil, gas and their infrastructure will be as long as possible.

In their strategy shift they are counting on the financial hesitancy and political leanings of state workers. They are also counting on the gullibility of DiNapoli and his anti-divestment supporters.

Shell Oil announced in December that the company “acknowledges and agrees with the importance attached by its investors to the issue of climate change, and also agrees that Shell’s future success is contingent on its ability to effectively navigate the risks and the opportunities presented by climate change.”

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Shell claims that it will incentivize executives with higher pay if they reduce carbon emissions. It claims to support the Paris climate accords and is planning in two years to set hard targets for emission reductions. It is promoting green tech ideas in many news outlets.

One might think that Shell has finally seen the light of renewables and is turning off the oil lamp. One might then ask how could activists be so “divisive” as to oppose such a change of mind? Shell’s media campaign with its green dreams puts the divestment movement in the difficult position of undermining its own goals by saying “too little, too late.”

Unfortunately, urgency is the dominant truth in climate change. We are at the mercy of the nature that we are altering, and nature says: “If you want a livable world stop the increase of fossil fuel emissions in two years and cut them in half in the next five.” This is a world of difference from Shell saying, “We will figure out our deadlines for emission reductions in two years.”

The value of fossil fuel assets has never been more precarious. With DiNapoli’s refusal to divest the average pensioner has already lost $17,000. The fossil fuel market is proving to be consistently volatile, an unstable foundation for pensions.

Let the worldwide declaration of “fossil free” do its work in forcing the energy industry to change without delay. A slow deal is no deal for New York and the world. Divest New York State pension funds from fossil fuels now.

John Ingram is a climate activist with 350NYC and Divest New York State.


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  #75  
Old 01-14-2019, 04:36 PM
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KENTUCKY

https://www.courier-journal.com/stor...rm/2540729002/

Quote:
Credit agency rebuts Gov. Matt Bevin's warning about pension bill

Spoiler:
One of the country’s major financial agencies disagreed with Gov. Matt Bevin’s dire claim that the Kentucky Supreme Court ruling knocking down pension reform would hurt the state’s credit rating.

The New York-based company Fitch Group said in a report released Thursday that the proposed changes weren’t the most critical component in their grade for the state.

Instead, the agency said, it is the state’s ability to fully fund retirement benefits and end a reliance on one-time funds to pay for them that matters most.

“Given the modest savings anticipated, the proposed pension benefit changes, and any related litigation, would not affect the state’s rating,” the report said.

Also: Bevin re-election rumors dominate 2019. But there are bigger questions

That rebuts the governor and his administration’s warning to state lawmakers in December when he called a surprise special session for them to pass a new pension bill.

Bevin said at the time that Kentucky’s low bond ratings could be downgraded — a move that would cost the state more to borrow and have additional implications.


“For the sake of all current and future Kentuckians, the legislature must act immediately before the commonwealth incurs further credit downgrades that will cost tens of millions of dollars for taxpayers and further limit the Commonwealth’s ability to pay for essential services, including education and healthcare,” Bevin said at the time.

Lawmakers convened for less than 24 hours.

Read this: After striking out twice, GOP tries again to 'effectively' ban abortion

"The left-wing media should be embarrassed of itself for celebrating a credit rating report that reaffirms the systemic problems facing our pension systems," Bevin spokeswoman Elizabeth Kuhn said.

Fitch's analysis follows a similar one last month by Moody's Investor Services, one of the other big three credit rating agencies, which also said the ruling didn’t result in any change to the state's overall credit rating.

But Moody's noted that the unanimous decision was a "credit negative" to delay much-needed reforms that were set to provide modest savings over the long term.

Kuhn mentioned that report, and how it noted Kentucky’s "failure to make significant pension reforms, in her statement.

The pension reform package, known as Senate Bill 151, was expected to save the state about $300 million over the next three decades, according to the Fitch report. The agency estimates that unfunded liability is at roughly $40 billion.

Bevin has made it his political mission to save Kentucky’s pension system, which is one of the worst-funded retirement benefit programs in the nation.

The Republican-controlled legislature zipped a controversial plan through the halls of Frankfort last year, which was met with furious protests from teachers and other public workers. It was soon thrust into the courts following a lawsuit by Democratic Attorney General Andy Beshear, who is running for governor.

Related: Bevin calls Lil Wayne a 'has-been' after Alabama-Clemson halftime show

Competition?: Robert Goforth enters governor's race, gives GOP a Bevin alternative

One part of the GOP plan would put future teachers into a cash balance retirement plan similar to a 401(k) savings plan, rather than into the traditional pension plan for teachers with defined benefits.

Legislative leaders have said they plan to take up pension reform again during this year’s 30-day legislative session but no such bill has been filed as of yet.

Fitch said in its new report that it will focus on how the state budget absorbs pension costs rather than proposed reforms when grading Kentucky’s credit rating.

“Assuming the legislature pursues similar provisions in a new bill, Fitch anticipates any beneficial effects to emerge slowly, as new hires with lower benefits gradually replace existing employees with higher benefits,” the report said. “These changes are unlikely to materially affect Fitch’s view of Kentucky’s long-term liability burden.”


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  #76  
Old 01-14-2019, 04:38 PM
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PENNSYLVANIA

http://www.altoonamirror.com/opinion...-pension-debt/

Quote:
We must pay our $70B pension debt

Spoiler:
The Mirror’s call for a closer look at Pennsylvania’s pension systems and the many news stories published in reaction to the review commission’s recommendations are welcome developments on an issue that’s too often overlooked by Pennsylvanians.


However, transparency and attention won’t pay for Pennsyl*vania’s $70 billion unfunded pension debt. Much more is needed if we want to avoid the steep tax increases that will be needed to pay for an unsustainable pension system during a recession.

Act 5 of 2017 took a meaningful first step away from defined-benefit plans — in which politics dictate benefits and taxpayers bear all the risk — and gives new public employees and new lawmakers a choice between a hybrid defined-contribution (401k) and defined-benefit plan or a purely defined-contribution plan.

Now, lawmakers can continue the transformation initiated by Act 5 by doing the following:

Increase pension contributions to pay off the unfunded liability over a 20-year period, as has been previously proposed in the House.

Modify pension plan benefits not yet earned.

Limit state spending growth and use revenue options — like privatizing Pennsylvania’s liquor control system — to pay down the liability.

Enact municipal pension reforms, supported by a bi-partisan coalition of mayors, that increase transparency, and moves to cash balance or defined-contribution plans for new employees in distressed municipalities.

We must not only bring transparency to Pennsylvania’s ill-managed and politicized pensions, but we must take intelligent action to stave off the potential financial distress our pension liability holds over our heads.

Michael Torres

Communications Officer

Commonwealth Foundation

Harrisburg


https://www.mcall.com/news/nationwor...110-story.html
Quote:
From boom to bust: A timeline of Pennsylvania's public pension systems

Spoiler:
Public pensions are funded three ways: employer contributions, employee contributions and investment returns.

When employers live up to their obligations and Wall Street performs well, public pensions pay for themselves.

But that has not been the case for decades in Pennsylvania as this timeline shows.

The timeline starts with the creation of state’s two public pension systems in the early 20th century.

It includes key legal decisions cementing the pension systems into public policy. It highlights political and financial decisions politicians have made, as well as market downturns, that have helped laden the systems with debt.

The timeline ends, for now, with a new law, which went into effect this month. The law reduces future investment risk for taxpayers by reducing retirement benefits for most future state employees and all future school workers.

Timeline
1917: Pennsylvania establishes Public School Employees’ Retirement System (PSERS) to provide retirement benefits for teachers and others.

1923: The state establishes State Employees' Retirement System (SERS) for government employees.

1934: Pennsylvania Supreme Court rules that government cannot take away a pension benefit previously granted to a worker. Since then, no state court has wavered from that precedent, which was based on a strict interpretation of the state constitution’s contract provision known as the remedies’ clause.

1960: State Supreme Court rules governments can change workers’ future retirement benefits to improve the financial soundness of a pension system.

1968: Lawmakers start providing cost-of-living increases to retired PSERS and SERS members every four to five years.

1981: Republican Gov. Dick Thornburgh and the Legislature establish Public Employee Retirement Commission to give non-binding reports on the viability of SERS and PSERS and on financial implications of legislation that would change the retirement systems.

1984: State Supreme Court rules the state cannot retroactively raise employees’ pension contribution rates for existing school employees.

1987: Lawmakers vote to give themselves a mid-term raise of $12,000 despite a constitutional provision barring it. The salaries of judges, the lieutenant governor and the governor’s cabinet also increase. Pensions, which are tied to pay, also go up.

1988: State Rep. John Kennedy, R-Cumberland, sues in Commonwealth Court to overturn the pay raise as unconstitutional; The court rejects the lawsuit.

1995: Legislators vote to raise their salaries nearly 19 percent, which in turn boosts pensions upon retirement.

1995: New law gives annual cost of living increases to employees in all branches of state government, which also boosts pensions upon retirement.

1997: Republican Gov. Tom Ridge and lawmakers reduce the state’s and school district’s employer contributions to nearly 0 percent because SERS and PSERS are flush with investment cash.

2000: SERS reaches surplus zenith of $6.4 billion.

2001: Ridge lets lawmakers dip into the surplus by signing Act 9. The law retroactively raises pensions for legislators by 50 percent, and state workers and teachers by 25 percent from the first day of public service. It also reduces from five to 10 years how long it takes for elected officials and employees to become vested. The Sept. 11 terror attacks come months later, putting Wall Street investments into a tailspin and triggering today’s deficit.

2002: PSERS surplus plateaus at $6.9 billion before it descends.

2002: GOP Gov. Mark Schweiker signs Act 38. It appeases retirees’ anger at being left out of the 2001 pension bump law by giving them a cost-of-living hike that which adds $1.75 billion in unfunded costs for SERS and PSERS. It also puts a one-year cap on employer contributions at 1.15 percent, further underfunding SERS and PSERS.

2003: Act 40 spreads out employers’ SERS and PSERS’ pension obligations from 10 years to 30 years to the reduce annual debt burden on taxpayers.

2005: In a late-night vote, legislators give themselves pay raises ranging from 16-34 percent, as well as increases for the governor, cabinet, judges and university presidents, among others.

2005: Lawmakers repeal all pay raises amid voter outrage — but the repeal does not affect pensions, which remain higher based on the four months of higher pay.

2006: State Supreme Court rules lawmakers’ 2005 pay raise unconstitutional, but says the Legislature could not reduce judges’ raises, which were reinstated.

2008: SERS and PSERS investments take giant tumbles in Great Recession.

2010: Democratic Gov. Ed Rendell signs Act 120 to partially rollback pension obligations caused by the 2001 law and pay back debt that had been accruing since 1997. Act 120 only affects new employees hired after July 1, 2011, by increasing retirement age to 55 and 65, depending on the job, and increasing vesting time from five to 10 years.

2011: Republican Gov. Tom Corbett takes office and gets stuck with paying Act 120’s long-term back debt obligations ($14.7 billion for SERS; $2.5 billion for PSERS) amid ongoing state and national financial crisis.

2013: Corbett’s 2013-14 budget proposal calls for pension reforms. He wants to reduce prospective benefits for current employees and put all future employees in a 401(k)-like system. Republican and Democratic lawmakers rebel, labeling his plan to change current workers benefits illegal under the 1934 court ruling.

2014: Corbett, while seeking re-election, sees his pension plan die in a budget fight with Legislature and amid legal threats.

2015: GOP-led House and Senate pass a version of Corbett’s pension bill knowing first-term Tom Wolf, a Democrat, will veto it because of legal questions. Wolf does.

2016: Wolf, with lawmakers’ blessing, shuts down Public Employee Retirement Commission, which had found errors in reform bills floated to settle budget fight.

January 2017: Pension debt climbs to $72 billion, activists say.

June 5, 2017: GOP-led Senate passes a pension bill to reduce future debt risk to taxpayers starting in 2019. The bill creates a hybrid pension plan that puts about half the officials’ and workers’ pension benefits in SERS’ and PSERS’ existing taxpayer-backed systems, and the other half into a corporate-style 401(k)-style plan that fluctuates with the markets.

June 8, 2017: GOP-led House passes the Senate pension bill after amending it to exclude lawmakers, state law enforcement and corrections officers from mandatory participation in the hybrid plans.

June 12, 2017: Wolf signs pension bill, creating Act 5. The law does not reduce existing debt, which fluctuates between $68 billion and $72 billion for both systems.

Dec. 19, 2018: Wolf, accompanied by the state treasurer and lawmakers, releases a report recommending SERS and PSERS change how they invest and manage money to potentially save taxpayers up to $10 billion over three decades.

Jan. 1, 2019: Act 5 takes effect for incoming state employees, who will receive reduced pension benefits compared to others already on the payroll.

July 1, 2019: Act 5 takes effect for incoming new school employees.

Sources: Pennsylvania Office of the Budget, state Public Employment Retirement Commission, SERS, PSERS and Morning Call archives, which includes staff and Associated Press reports.


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Old 01-14-2019, 05:08 PM
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CONNECTICUT

https://www.ctnewsjunkie.com/archive...sset_question/

Quote:
Pension Commission Still Wrestling With Asset Question

Spoiler:
HARTFORD, CT — Would $500 million in state-owned property be enough to create a trust fund to help stabilize one of the nation’s worst under-funded pension liabilities? Should state parks and forests be exempt from consideration? What about polluted or historic properties?

Those were just a few of the unanswered questions the Pension Stability Commission wrestled with Thursday.


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Rep. Jonathan Steinberg, D-Westport, said in the next few weeks the commission, which is already in overtime, will have to start making recommendations to the new legislature.

He said the commission won’t have time to go over every asset the state owns and determine whether it could be added to a Legacy Obligation Trust. However, he sought to get the commission to offer up some guidelines for what property might be included or excluded.

Under the Legacy Obligation Trust model, the trust would get credit against an unfunded liability based on the valuation of the asset in the trust.

But not every member of the commission believes that model is feasible.

Erin Choquette, legislative and policy adviser at the state Department of Administrative Services, questioned whether there are enough assets to generate enough money to help prop up the pension plans.

“I don’t think we should discount the LOT, but based on my discussions with Paul I’m not sure there are sufficient assets to create a LOT at this time,” Ted Murphy, a Litchfield real estate professional on the commission, said.

Choquette said she doesn’t believe anyone on the commission is uncertain about how they feel regarding the LOT concept.

The commission is still working on creating an inventory of state assets. Working through the legal obligations of each piece of property will require greater expertise than the commission possesses.

Steinberg said back when the commission was formed the initial goal was to create $1 billion in value to support the pension plans.

“No matter how many assets there are it’s not solving the entire pension problem,” Steinberg said.

Michael Imber, another member of the panel who has touted the LOT concept, said this would be the first time any government has formally tried to evaluate this idea.

The commission is also considering recommending using assets from the Connecticut Lottery to shore up the Teacher’s Retirement System. That was a recommendation by former state Treasurer Denise Nappier.

The commission suggested the new state Treasurer Shawn Wooden should have an opportunity to weigh in on the issue.


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Old 01-14-2019, 05:17 PM
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VENTURA COUNTY, CALIFORNIA

https://www.vcstar.com/story/news/lo...rs/2499298002/
Quote:
A booming economy hasn't put a dent in Ventura's pension debt

Spoiler:
Even with over nine years of a growing economy, Ventura's pension debt continues to increase, according to the most recent report on the city's overall financial health.

The city's overall pension obligations sat at $654.8 million as of June 30, 2018, a jump of nearly 10 percent from the previous fiscal year, the report shows. The funded ratio, or how much the city has in assets compared to its liabilities, is 68.4 percent. It has decreased each of the last three years, meaning its unfunded portion has grown.

MORE: Four cities tackle growing pension costs

The just-released Comprehensive Annual Financial Report, which covers fiscal year 2017-18, will be discussed during Monday night's City Council meeting.

Ventura breaks down its retirement costs into two plans, one for miscellaneous employees and one for public safety (police and fire). As of June 30, the funded ratio for miscellaneous was 73 percent, while public safety sat at 60 percent, according to the CAFR.

The funded ratio is considered one measure of the health of pension plans, along with an agency's debt, tax base, cash flow and other factors.


Ventura's funded ratio is similar to that of the state's plan, and much lower than the County of Ventura, which runs its own pension fund. That plan stood at nearly 88 percent as of June 30.

The city participates in the California Public Employees' Retirement System. CalPERS pays retiree benefits through employer and employee contributions, which pay for 26 cents and 13 respectively of each dollar paid out; and investments, which pay for 61 cents. That heavy reliance on investments makes the system vulnerable to economic downturns, and when the market fails to hit the 7 percent target CalPERS has set for returns, taxpayers make up the difference.


In the past six years, CalPERS investment returns have ranged from 0.6 percent to 17.7 percent, exceeding 7 percent in four of those years.

MORE: Newsom will propose nearly $2 billion for early childhood programs

Ventura paid $17.4 million to CalPERS in the fiscal year that ended June 30. That figure is expected to well exceed $30 million by 2045-25, according to the most recent actuarialreports.

Also Monday, the City Council will vote on a new contract with members of the city's fire management union that gives raises of just over 5 percent for two years. The contract, which started Jan. 1 and ends Dec. 31, 2020, will cost roughly $110,000, according to the staff report.

The council previously approved new contracts with police, Service Employees International Union and others. The contracts total about $3.9 million in raises over the life of the contracts, which expire between June 30, 2020 and Dec. 31, 2020. The council continues to negotiate with members of its rank-and-file fire union.

Monday's meeting starts at 6 p.m. at City Hall, 501 Poli St.


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Old 01-14-2019, 05:18 PM
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KENTUCKY

http://www.wave3.com/2019/01/13/ky-s...ion-statement/
Quote:
KY Senate Republican leader agrees with credit agency’s pension statement
Pension changes would not affect Kentucky’s credit rating, a leading agency says

Spoiler:
LOUISVILLE, KY (WAVE) - The President of the Kentucky State Senate stated this week that he agrees with statements made by the Fitch Ratings agency that Kentucky’s pension crisis might not crater the state’s credit rating, as Governor Bevin feared, following a Kentucky Supreme Court decision to strike down a pension bill it considered to be passed unconstitutionally during the 2019 legislative session.

When asked about his thoughts on the one of the country’s “Big Three” credit agencies saying proposed changes so far wouldn’t affect Kentucky’s rating, President Robert Stivers said that he agreed.

The ratings agency said the proposed pension changes aren't the most critical factor in grading the state's credit.

The governor justified December's special session by claiming a failure to act would trigger a credit downgrade for the state’s bond ratings.

The Fitch report said the pension bill would only save Kentucky 300 million dollars over the next 30 years, which is less than one percent of the state’s pension liability.

In December, Moody’s called legal challenges to that bill a “credit negative”, but did not lower the state’s rating.

Stivers said he agrees with what Fitch said, and echoed the previous comments from Moody’s.


“This is something that has to move in increments," Stivers said. "One of the increments funding is a part of it. A new plan is a part of it. Things like that have to be taken into conjunction with each other.”

No major pension legislation was brought to the floor during the first part of the 2019 regular session of the Kentucky legislature.

Lawmakers on both sides of the aisle noted Friday that a fix to the pension crisis might not even come this session. They also floated the possibility of using a special session to tackle the issue this year.

It was announced Friday that a bipartisan working group has been developed to come up with a solution by an initial deadline of Mid-February.


http://www.weku.fm/post/state-public...t-meeting-week

Quote:
State Public Pension Working Group's First Meeting This Week

Spoiler:
The first meeting of a newly formed legislative Public Pension Working Group is scheduled Tuesday in Frankfort. It will review the systems’ structure, costs, benefits, and funding. The group is charged with making recommendations for General Assembly action by mid- February, but it could be extended until December first.

Listen Listening...1:43
Legislative action on a pension fix this session is certainly a question mark. During last week’s initial four days of the 2019 session, Grayson Senator Robin Webb was asked about that possibility. “I think there are some ideological differences on each side as to what the definition of fix would be, and who has the risk, how we fund things, how it’s structured going forward. I think those are all legitimate differences,” said Webb.

Lexington Senator Alice Forgy Kerr believes the first priority is to identify pools of money to address the pension plans’ unfunded liability.

Governor Bevin called lawmakers to Frankfort for a special session in December. The House and Senate adjourned in day two without taking action.

Bevin was critical for what he termed a lack of leadership in acting on special session recommendations. Veteran Louisville Senator Dan Seum believes the governor’s comments do complicate the process. “You know everybody seems to forget, when you elect a governor, one of his charges is he has to govern. And quite frankly this guy’s not very good at it,” said Seum.

Senate President Robert Stivers says there will be an effort to create a pension bill, but he’s not sure if it will be finalized with a vote this session.


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Old 01-14-2019, 05:19 PM
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CALIFORNIA
https://calmatters.org/articles/laus...nsion-schools/

Quote:
It didn’t fix the L.A. teacher strike, but Newsom’s pension idea would help schools, anyway

Spoiler:
Gov. Gavin Newsom’s $3 billion plan to pay down California public schools’ pension obligations may not have been enough to prevent teachers in Los Angeles from striking. But it’s not nothing, school officials across California say.

Newsom’s proposal, made last week as part of a record $80.7 billion budget for K-14 education, threw school districts a modest lifeline on one of the public school system’s more widespread financial pressures—the rapidly rising cost of teacher pensions.

The suggestion alone was enough to briefly raise hopes at the Los Angeles Unified School District, and to prompt officials there to make a fresh offer to the local teachers union, based on an estimate that Newsom’s idea could generate $40 million or more for classroom size reductions and more nurses and counselors.

The union wasn’t buying, but other districts say they’re already looking at what they could do with the estimated $50 per student the plan could save them, by the California School Board Association’s calculation. For example, Torrance Unified, which educates more than 23,000 kids in Los Angeles County, estimates it could save $2.6 million over the next three years from Newsom’s proposal, according to superintendent George Mannon.

“It’s a tremendous first step, which lessens the impact on districts and frees up more resources to be used for students,” said School Boards Association spokesman Troy Flint. “Schools will be able to direct more resources to the classroom as a result of what the governor proposed in his budget, and we’re very excited about that.”

Under Newsom’s proposal, $2.3 billion would be earmarked to help pay down school districts’ long-term unfunded pension liability into the California State Teachers’ Retirement System (CalSTRS), while another $700 million would lower districts’ contribution rates over the next two fiscal years.

The one-time funding would save schools $700 million in the short-term and about $6.9 billion over the next three decades, according to projections by the Newsom administration. It essentially would free up operating dollars that districts could potentially spend in classrooms.

Michael Fine, CEO of the state’s Fiscal Crisis and Management Assistance Team, said in an email that Newsom’s proposal would have a “positive impact on districts.” While schools’ pension contribution rates would still rise slightly next year, the impact is “certainly not small,” Fine noted.

“Maybe more importantly,” he added, “it [Newsom’s proposal] is a public recognition by Sacramento that districts are struggling.”

California has increased spending for K-12 education by an unprecedented $23 billion since Gov. Jerry Brown signed the Local Control Funding Formula into law in 2013. The new school funding mechanism restored steep cuts made during the recession and channeled more money to schools that have higher concentrations of disadvantaged students.

But despite a flourishing economy and increased state spending, the benefits of recent funding boosts have not been fully realized by districts, school finance experts say, in part because of fixed costs that have climbed at a faster rate than operating budgets. Student enrollment, and the per-pupil funding that comes with it, continues to decline across the state while the number of costlier special needs students has risen, along with pension costs that have more than doubled since 2013.

In 2014, the state Legislature required teachers and school districts to make higher payments into CalSTRS, which had been severely underfunded and threatened retirement savings for teachers, who don’t receive Social Security.

For school districts, that meant increasing payments from 8 percent of payroll in 2013 to 19 percent by 2020. While these pension costs would continue to increase under Newsom’s proposal, they would do so at a lower rate.

So instead of having districts’ contribution rate go up from the current 16.28 percent to 18.13 percent, as state law mandates, the rates would only go up less than 1 percentage point in 2019-20, to 17.1 percent. The following year, the rate would rise to 18.1 percent instead of 19.1 percent.

“If you are a member of a school board, you are enthusiastic about this,” Newsom said Thursday when he unveiled his budget.

“This is a big deal. This is not paying down the state’s obligation—this is helping relieve the districts’ burden… I know it’s still 18.1 (percent in 2020-21), but it’s a relief to the system, and I think it’s an important one as well.”

Newsom’s budget also includes a four-year, $2.9 billion pay down plan of the state’s long-term CalSTRS obligations, which he said would save the state $7.4 billion over the next 30 years.

A November 2017 survey by the School Boards Association found that practically all districts have either dipped into their reserves to cover pension costs or made budget cuts.

“While this is helpful, we don’t want people to think that school districts are in good shape financially,” said Steve Ward, legislative analyst for Clovis Unified in the Central Valley, which anticipates about $2 million in savings from Newsom’s plan.

Ward said the district, which educates more than 42,000 students, could perhaps restore some student programs and resources while deficit spending at the current rate, or use the money to pay off more debt. But the money, he added, would hardly be a cure-all.

“Districts all around the state are severely stressed. We’ve got to continue advocating and educating people as to why it is that school districts are making cuts when the economy is booming.”

Flint of the School Boards Association agreed that rising pension costs “have had a negative impact on every California district in one way or another, and the governor’s proposal is not going to completely eliminate that.”


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