California State Pension System (CalPERS and CalSTRS)

Resources:
Mercatus Center
CalPERS Annual Report 2017
CalSTRS Annual Report 2017

Illinois State Retirement Fund

 

Pew Research Center on Illinois Pensions

Illinois Policy Center

Mercatus Center on Illinois Pension

New York City Pension Fund

New York City Pension Fund

 

  • New York City officials estimate the pension debt at $65 billion, but the Manhattan Institute estimates the debt at $142 billion
  • New York City pension plans assess the return on long-term pension investments to be 7%, when the real return on long term bond investments is closer to 2%.
  • Today, 11% of the budget of New York City is devoted to servicing the pension plans of its retirees
  • New York City increased benefits to retirees in the early 2000’s – without the funding to do so. That move has costed the city more than $13 billion to the pension bill in the decade following.
  • New York City made a new rule in the early 2000’s that exempted most city employees for having to contribute to their pension plan during their employment.

 

Manhattan Institute on New York Pension

Pew Research on New York City Pensions

New Jersey State Pension Fund and New Jersey State Cash Management Fund

  • The New Jersey state pension system is comprised of seven public service pension funds.
  • As of January 2018, that State of New Jersey Pension Fund possessed assets that covered 30 percent of outstanding liabilities, below the 40 percent mark that the Rockefeller Institute deems “crisis level”
  • The New Jersey State Pension Fund is the most under-funded in America with $124 Billion dollars in debt heading into 2018
  • According to the new accounting standards introduced by WNYC, the total pension debt is $253 billion dollars as of 2018. The total state budget for New Jersey is $35 Billion.
  • By 2023 the state will be liable for $11.3 billion dollars of pension benefits, amounting to 27 percent of the total budget for the state
  • The Urban Institute Pension Report Card gave the New Jersey State Pension Fund a rating of “D”

Resources:
Pew Report on New Jersey’s Pension Fund
Mercatus Institute on New Jersey’s Pension Fund
Urban Institute on New Jersey’s Pension Fund
Manhattan Institute Report on New Jersey Pension Fund

Manhattan Institute: The Public Pension Problem: It’s Much Worse than It Appears

Taxpayer-funded contributions to government pensions can make up one the largest single elements in a local budget. Manhattan Institute scholars have consistently pushed for governments to reform their pension system and thus avoid the necessity of cutting public services.

View the article: Manhattan Institute: The Public Pension Problem: It’s Much Worse than It Appears

Press-Republican: Cuomo ignites pension fund debate with divestment push

But the governor’s move has spawned concerns that a green energy litmus test over investment decisions could end up limiting the fund’s growth should Cuomo’s prognostications regarding energy sector stocks prove to be flawed. “The comptroller needs to stick to his guns and understand that his fiduciary responsibility is to the beneficiaries” of the fund, said Christopher Burnham, the former Connecticut state treasurer who served as the sole trustee of the Nutmeg State’s pension fund from 1995 to 1997.

 

“You have to invest these monies cautiously, carefully and wisely, and without allowing a personal agenda to play a role in how you execute your duties,” said Burnham, a Republican and native New Yorker who is chairman of Cambridge Global Advisors in Virginia. DiNapoli and Cuomo are downstate Democrats, though at times the relationship between the two has been chilly. Since Cuomo advanced his pension proposal, the comptroller has avoided arguing with the governor over the issue, instead signaling that he welcomes the “opportunity to partner” with Cuomo via an advisory council aimed at “achieving investment returns.”

 

ALEC: Unaccountable and Unaffordable: Unfunded Public Pension Liabilities Exceed $6 Trillion

Absent significant reforms, unfunded liabilities of state-administered pension plans will continue to grow and threaten the financial security of state retirees and taxpayers alike. The fiscal calamity could be far deeper and prolonged than the Great Recession.

View the pdf: ALEC: Unaccountable and Unaffordable: Unfunded Public Pension Liabilities Exceed $6 Trillion

The Hill: Pensions should avoid politics and invest for the benefit of our workers

Why do public fiduciaries think they should impose their political agenda on other people’s retirement benefits? Is not the standard of care to manage public retirement funds with the highest return at the lowest reasonable risk? With more than 50 percent of all state pension funds significantly underfunded and at least five states, including my native Connecticut, facing immanent bankruptcy due to grossly unfunded state employee and teacher pension systems, why would both beneficiaries and taxpayers, who will be forced to makeup those liabilities, want to politicize the management of the money? As I will also be a beneficiary in a few years, please manage the money without a political agenda.

 

When I was elected state treasurer of Connecticut in 1994, I inherited the worst performing state pension system in America for the previous 10 years. Within the first six months we fired the vast majority of money managers and indexed 75 percent of the portfolio. Yet, I was attacked for holding tobacco stocks in the portfolio, by virtue of the fact that we owned an S&P 500 stock index fund. I refused to play politics with the pension, particularly after 10 years of politics had relegated pension fund performance to the gutter. Instead, we focused on the highest return at a reasonable risk, and performance skyrocketed from dead last to the top 25 percent in the country, overnight.