Many Public Pension Plans Still Recovering from Economic Downturn

Wednesday, June 11, 2014

The Center for State and Local Government Excellence 2014 report of state and local government pension funding finds that many plans are still recovering from the effects of the economic downturn. The paper, The Funding of State and Local Pensions 2013-2017, based on a survey of 114 state and 36 local plans, found that despite a strong stock market, the funded status of public plans in 2013 remained unchanged at 72% for two reasons: actuarial smoothed assets grew modestly, and the California Public Employees’ Retirement System, one of the nation's largest plans, significantly revised its reported funded ratio. Funded levels among plans vary significantly, but many sponsors appear to be paying a larger share of their annual required contribution, and the funded ratio is projected to gradually move to greater than 80%.