The Impact of Public Pensions on State and Local Budgets
The brief’s key findings are:
- Currently, state and local pension contributions equal 3.8 percent of total budgets.
- To get back on a path to full funding, sponsors will need to contribute:
- 5.0 percent of budgets if liabilities are discounted by 8 percent; or
- 9.1 percent of budgets if liabilities are discounted at 5 percent.
- But states with seriously underfunded plans and/or generous benefits – like CA, IL, and NJ – will need to contribute significantly more.