NASRA Annual Conference Presentation
Public Retirement Systems: Update on Recent Trends
Presentation Overview
1
Overarching trend: Shifting risk from employers to employees
▲ ▲ ▲
Shared Risk Continuum
NASRA Issue Brief: Shared Risk in Public Retirement Plans, 2014
2
Statewide Hybrid Plans Currently in Place
NASRA Issue Brief: State Hybrid Retirement Plans, 2016
Cash balance hybrid plans
3
DB-DC hybrid plans
New plan in Michigan
4
New plan in Pennsylvania
New plan for Houston city employees
5
Schematic of Houston’s Plan Design
Changing the default plan
6
Overarching trend: The new normal
Overarching trend: The new normal
7
Cumulative change in employment, private sector and state and local government, 2007-2017
US Bureau of Labor Statistics
Annual change in wages and salaries, private sector and state and local government, 2006-2016
US Bureau of Labor Statistics
8
Annual median change in public pension payrolls, FY 02 to FY 15
Public Fund Survey, NASRA
Distribution of Public Pension Investment Return Assumptions, FY 01 to FY 18
9
Changes to the investment return assumption
Methods states are using to amortize unfunded pension liabilities
10
Governance Changes
▲
Public Pension Legal Protections
11
Legal Rulings
Legal Rulings
12
Recent GASB Changes
▲
▲
▲
▲ ▲
Effects of new GASB Statements
13
Books, Budgets, and Bonds
Public Pension Funding Conditions
14
History of Aggregate Public Pension Funding Levels, FY 01 to FY 16
Public Plans Database and Public Fund Survey
Distribution of Public Pension Funding Levels, FY 16
Public Plans Database and Public Fund Survey
15
Annual Required Contribution/Actuarially Determined Contribution Experience, FY 01 to FY16
NASRA Issue Brief: State and Local Government Contributions to Statewide Pension Plans: FY 15
Annual Required Contribution/Actuarially Determined Contribution Experience, FY 15
NASRA Issue Brief: State and Local Government Contributions to Statewide Pension Plans: FY 15
16
Weighted Average Required Contribution Paid, by State, FY 01 to FY 15
NASRA Issue Brief: State and Local Government Contributions to Statewide Pension Plans: FY 15
Taxpayer spending on pensions
▲ ▲
17
Employer (taxpayer) spending on public pensions, 1986 to 2015
Dollars are adjusted for inflation
“State and Local Government Spending on Public Employee Retirement Systems,” NASRA 2017
Pension challenges facing state and local government
▲ ▲ ▲
18
Pension challenges facing state and local governments, continued
▲ ▲
▲
▲ ▲
▲
Contact Info
19
Presentation Overview
1
Overarching trend: Shifting risk from employers to employees
▲ ▲ ▲
Shared Risk Continuum
NASRA Issue Brief: Shared Risk in Public Retirement Plans, 2014
2
Statewide Hybrid Plans Currently in Place
NASRA Issue Brief: State Hybrid Retirement Plans, 2016
Cash balance hybrid plans
3
DB-DC hybrid plans
New plan in Michigan
4
New plan in Pennsylvania
New plan for Houston city employees
5
Schematic of Houston’s Plan Design
Changing the default plan
6
Overarching trend: The new normal
Overarching trend: The new normal
7
Cumulative change in employment, private sector and state and local government, 2007-2017
US Bureau of Labor Statistics
Annual change in wages and salaries, private sector and state and local government, 2006-2016
US Bureau of Labor Statistics
8
Annual median change in public pension payrolls, FY 02 to FY 15
Public Fund Survey, NASRA
Distribution of Public Pension Investment Return Assumptions, FY 01 to FY 18
9
Changes to the investment return assumption
Methods states are using to amortize unfunded pension liabilities
10
Governance Changes
▲
Public Pension Legal Protections
11
Legal Rulings
Legal Rulings
12
Recent GASB Changes
▲
▲
▲
▲ ▲
Effects of new GASB Statements
13
Books, Budgets, and Bonds
Public Pension Funding Conditions
14
History of Aggregate Public Pension Funding Levels, FY 01 to FY 16
Public Plans Database and Public Fund Survey
Distribution of Public Pension Funding Levels, FY 16
Public Plans Database and Public Fund Survey
15
Annual Required Contribution/Actuarially Determined Contribution Experience, FY 01 to FY16
NASRA Issue Brief: State and Local Government Contributions to Statewide Pension Plans: FY 15
Annual Required Contribution/Actuarially Determined Contribution Experience, FY 15
NASRA Issue Brief: State and Local Government Contributions to Statewide Pension Plans: FY 15
16
Weighted Average Required Contribution Paid, by State, FY 01 to FY 15
NASRA Issue Brief: State and Local Government Contributions to Statewide Pension Plans: FY 15
Taxpayer spending on pensions
▲ ▲
17
Employer (taxpayer) spending on public pensions, 1986 to 2015
Dollars are adjusted for inflation
“State and Local Government Spending on Public Employee Retirement Systems,” NASRA 2017
Pension challenges facing state and local government
▲ ▲ ▲
18
Pension challenges facing state and local governments, continued
▲ ▲
▲
▲ ▲
▲
Contact Info
19
