Public Sector Pensions

Public Sector Pensions

Research

Marc Joffe, Jesse Martinez | Apr 12, 2016
Puerto Rico is facing a severe fiscal crisis, and new crises will be almost inevitable in the absence of major institutional changes in the commonwealth. History has bequeathed the island inefficient state-run enterprises and a government unable to balance its budget, but Puerto Rico could have a bright future if it undertakes the right reforms.
John A. Dove, Daniel J. Smith | Mar 22, 2016
Alabama currently lags behind its regional neighbors and the nation in economic growth and performance. This study undertakes a comprehensive analysis of Alabama's current fiscal situation as well as the reforms necessary to put Alabama on the road to economic prosperity.
Mark J. Warshawsky, Ross Marchand | Jan 07, 2016
A new study for the Mercatus Center at George Mason University examines both the overall financial condition of state and local pension plans and the legal impediments to pension reform. It argues that reform proposals that assume the federal government will bail out state and local pen- sions are politically and economically unworkable and unfair. Instead, it presents a two-pronged reform proposal: (1) require state and local authorities to disclose the financial condition of their pension plans to beneficiaries in plain language and using standardized conservative accounting assumptions, and (2) allow state and local governments to offer beneficiaries a choice between accepting the uncertain and risky future benefits originally promised or receiving a discounted lump-sum benefit right away.
Susan P. Convery, Andrew J. Imdieke | Nov 05, 2015
A new study for the Mercatus Center at George Mason University examines how government financial statements that follow generally accepted accounting principles provide useful information to decision makers. Local government decision makers should learn how to use this information to design stronger governments that avoid fiscal distress.
Erick M. Elder, Gary A. Wagner | Apr 15, 2015
A new study for the Mercatus Center at George Mason University is the first to examine whether public pensions that are funded at various levels will have sufficient assets to pay all promised future benefits. The study also looks at the distribution of the potential accumulation of assets for pensions that do have sufficient assets. Examining PSERS and SERS using financial modeling over a period of years, the study presents two conclusions applicable to all public pensions.
Andrew G. Biggs | Feb 10, 2015
A new study for the Mercatus Center at George Mason University explores investment-based transition costs and calculates optimal investment portfolios for pension plans, both those that remain open to new participants and those that have been closed.

Testimony & Comments

Research Summaries & Toolkits

Speeches & Presentations

Expert Commentary

Aug 18, 2016

When investment returns aren't enough, who foots the bill? Of the $2.26 billion in TRS revenues in 2015, only a sliver came from investment income while 83 percent came from the pockets of Alabama employees and their employers.
Aug 17, 2016

Many U.S. state and local employee pensions are facing dire problems as massive plan liabilities come due, threatening to drain government coffers.
Jun 01, 2016

In a new Mercatus Center study that ranks each of the 50 states and Puerto Rico according to their fiscal condition, one common theme among the worst performing states is their drastically under-funded public pension systems.
Jun 01, 2016

The information is right in front of us, but if we don’t pay attention, we risk missing the warning signs of the next state or territorial fiscal crisis.
May 23, 2016

Defenders of Alabama's tenuous pension status quo accurately point out that we have not yet seen the full effects of the 2011 and 2012 reforms to the Retirement System of Alabama. Unfortunately, that is not an excuse to avoid further action.
Jan 10, 2016

Poor decisions by state and local officials, and the politically charged collective-bargaining environment they work within, are to blame for the crisis. It's up to these policymakers to work with pension-plan beneficiaries and their representatives to solve it. The following plan would alleviate some of the financial pressure on public pension plans and satisfy retirees who are willing to opt-in - and it is politically viable.

Charts

Experts

Podcasts

Eileen Norcross | April 09, 2015
With all the talk about pension reform in Pennsylvania, Eileen Norcross discusses whether existing guidelines are enforced this with Keystone Crossroads.

Recent Events

Mercatus Center budget scholars will share their academic research and practical knowledge with local thought leaders in a half-day seminar hosted by the Bluegrass Institute in Lexington, Kentucky.

Media Clippings

Eileen Norcross, Matthew Mitchell, | Jul 23, 2013
Detroit reports an unfunded pension liability of $634 million, but using more accurate accounting methods it's closer to $3.5 billion.
Eileen Norcross, Jerry Brito | Oct 01, 2012
Eileen Norcross and Jerry Brito cited on Virginia Watchdog discussing public pensions.
Eileen Norcross | Aug 30, 2012
Eileen Norcross cited discussing high risk financing.
Eileen Norcross | Jul 11, 2012
Eileen Norcross is quoted in the guardian discussing the straining budgets of state and local governments in the U.S.
Eileen Norcross | Jun 15, 2012
Eileen Norcross explains the effect changes will have on New Jersey's pension liability.
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