55 min
Special Briefing: Public Pensions - Still a Crisis? Special Briefing
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- Government
Many states, counties, and cities emerged from the COVID-19 pandemic and resulting recession with record cash reserves following the US government’s injection of $5 trillion to revive the economy and prop up local government budgets. But even after the unprecedented federal support, states and municipalities have been left with more than $1.3 trillion in unfunded liabilities for public employee pension benefits that were promised but are not fully funded. Join our panel of experts as they discuss strategies that state and local governments are adopting to reduce this pension burden and whether they may have to reduce spending for education, infrastructure, and other critical public services to make room for increasing retirement contributions.
Our panel of experts includes Liz Farmer, public finance journalist and co-host of the Public Money podcast; Vedanta Goenka, senior municipal strategist, Citigroup; Merl Hackbart, professor emeritus, Martin School of Public Policy and Administration, University of Kentucky; Shoaib Khan, director, New Jersey Treasury Division of Investment; Anthony Randazzo, executive director, Equable Institute; and Les Richmond, vice president and actuary, Build America Mutual.
Notable Quotes:
“We have a target of approximately 30% of the [pension] portfolio to alternative asset classes,” - Shoaib Khan.
“Our top assessment from a 50 state review of data is that funding strategies for public plans have significantly improved whether we look at the last five years or the last 15 years,” - Anthony Randazzo
“As far as pension funding is concerned, we–– as Anthony mentioned –– have seen a tremendous improvement in ratios since the pandemic,” - Vedanta Goenka
“The adjustments that state and local governments have made to their pension systems in response to pension system concerns, such as adjusting benefits, supplemental funding, and ensuring contributions are meeting their requirements, has demonstrated a commitment to take actions to ensure the sustainability of pension systems,” - Merl Hackbart
"So, you might have neighboring towns that have very similar pension profiles — one is carrying a high amount of debt, one is carrying a little amount of debt — I would say the one with a little amount of debt is in much better shape. So it calls for granular analysis [if] we're going to answer the question if pensions are still in crisis.” - Les Richmond
“In a lot of places, [pensions are] still very much an issue, but in terms of the national conversation, pensions have definitely kind of taken a step back.” - Liz Farmer
Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.
Learn more about the Volcker Alliance at: volckeralliance.org
Learn more about Penn IUR at: penniur.upenn.edu
Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn
Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.
Many states, counties, and cities emerged from the COVID-19 pandemic and resulting recession with record cash reserves following the US government’s injection of $5 trillion to revive the economy and prop up local government budgets. But even after the unprecedented federal support, states and municipalities have been left with more than $1.3 trillion in unfunded liabilities for public employee pension benefits that were promised but are not fully funded. Join our panel of experts as they discuss strategies that state and local governments are adopting to reduce this pension burden and whether they may have to reduce spending for education, infrastructure, and other critical public services to make room for increasing retirement contributions.
Our panel of experts includes Liz Farmer, public finance journalist and co-host of the Public Money podcast; Vedanta Goenka, senior municipal strategist, Citigroup; Merl Hackbart, professor emeritus, Martin School of Public Policy and Administration, University of Kentucky; Shoaib Khan, director, New Jersey Treasury Division of Investment; Anthony Randazzo, executive director, Equable Institute; and Les Richmond, vice president and actuary, Build America Mutual.
Notable Quotes:
“We have a target of approximately 30% of the [pension] portfolio to alternative asset classes,” - Shoaib Khan.
“Our top assessment from a 50 state review of data is that funding strategies for public plans have significantly improved whether we look at the last five years or the last 15 years,” - Anthony Randazzo
“As far as pension funding is concerned, we–– as Anthony mentioned –– have seen a tremendous improvement in ratios since the pandemic,” - Vedanta Goenka
“The adjustments that state and local governments have made to their pension systems in response to pension system concerns, such as adjusting benefits, supplemental funding, and ensuring contributions are meeting their requirements, has demonstrated a commitment to take actions to ensure the sustainability of pension systems,” - Merl Hackbart
"So, you might have neighboring towns that have very similar pension profiles — one is carrying a high amount of debt, one is carrying a little amount of debt — I would say the one with a little amount of debt is in much better shape. So it calls for granular analysis [if] we're going to answer the question if pensions are still in crisis.” - Les Richmond
“In a lot of places, [pensions are] still very much an issue, but in terms of the national conversation, pensions have definitely kind of taken a step back.” - Liz Farmer
Be sure to subscribe to Special Briefing to stay up to date on the world of public finance.
Learn more about the Volcker Alliance at: volckeralliance.org
Learn more about Penn IUR at: penniur.upenn.edu
Connect with us @VolckerAlliance and @PennIUR on Twitter, Facebook and LinkedIn
Special Briefing is published by the Volcker Alliance, as part of its Public Finance initiatives, and Penn IUR. The views expressed on this podcast are those of the panelists and do not necessarily reflect the position of the Volcker Alliance or Penn IUR.
55 min