An Update on Locally-Administered Pension Plans
The brief’s key findings are:
- The funded status for local plans fell from 83 percent in 2006 to 77 percent in 2010, similar to the pattern for state plans.
- Discounting liabilities at the riskless rate would reduce the funded status to the 50-percent range.
- Local plans are more expensive than state plans, but they have done a better job of making their annual required contributions.
- Pension payments by local governments are about 8 percent of their total budgets.
- Strikingly, only 40 percent of local payments go to local plans; the other 60 percent go to state plans that cover local workers, primarily teachers.