The Funding of State and Local Pensions: 2013-2017

Alicia H. MunnellJean-Pierre Aubry Mark Cafarelli

SLP#39

The brief’s key findings are:

  • Despite a strong stock market, the funded status of public plans in 2013 remained unchanged at 72 percent for two reasons:
    • actuarially smoothed assets grew modestly; and
    • CalPERS, one of the nation’s largest plans, significantly revised its reported funded ratio.
  • An encouraging sign is that sponsors appear to be paying a larger share of their annual required contribution.
  • Going forward, the funded ratio is projected to gradually move above 80 percent, assuming historical stock market returns.