Media
HB 2497 Increases Pension Unfunded Liabilities
As we’ve pointed out, PSERS own charts show that the reform would leave the pension fund dangerously close to 50% funded—the same ratio that could result in a state takeover of Pittsburgh’s pension plans—in the middle of this 30-year reamoritization. And that’s assuming a generous 8% return.
Should lawmakers vote today, as expected, we will be posting their votes on HB 2497 here.
Finally, here is a letter we sent to lawmakers today, along with a number of business associations:
UPDATE: The Buck Consultants report, originally featured in this post, refers to an earlier version of HB 2497, it does not apply to the present bill language. That text appears below:
While some advocates supporting HB 2497 claim it would “save $3 billion,” actuaries come up with different numbers. Writes Gary Weckelsblatt for the Bucks County Courier Times:
Buck Consultants, the consulting actuary for the PSERS which put together the projections for lawmakers, figures the reform will cost $41 billion more through 2042. Statewide, district costs would grow from just under $170 billion to nearly $211 billion, according to the firm. The commonwealth reimburses the school districts for about half of the employer contribution rate.
Savings, which would occur through 2022, would be particularly significant from 2013 to 2016. But beginning in 2023, when payments would hit 28 percent of payroll under the measure, they would remain at that level for 18 years, costing significantly more than they would have without the reamoritization.