The Center for Retirement Research at Boston College has released a new Issue in Brief: "The Impact of Public Pensions on State and Local Budgets" by Alicia H. Munnell, Jean-Pierre Aubry, and Laura Quinby.
The brief's key findings are:
- Currently, state and local pension contributions equal 3.8 percent of total budgets.
- To get back on a path to full funding, sponsors will need to contribute:
5.0 percent of budgets if liabilities are discounted by 8 percent; or
9.1 percent of budgets if liabilities are discounted at 5 percent. - But states with seriously underfunded plans and/or generous benefits – like CA, IL, and NJ – will need to contribute significantly more.
The brief is available here.
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