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  #401  
Old 02-28-2019, 02:12 PM
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OKLAHOMA
COLAS

https://www.tulsaworld.com/news/hous...d86d75161.html

Quote:
House committee OK's cost of living adjustment for retired state employees

Spoiler:
OKLAHOMA CITY — It might not be much and it might not be for awhile, but long-suffering retired state employees may finally get a cost of living increase.

House Bill 2304, by Rep. Avery Frix, would provide 2 percent COLAs in 2020 from all six of the state’s pension funds. The funds have essentially been locked down for the past decade while their assets grew to something more in line with their long-term liabilities after years of being dangerously underfunded.

The bill passed out of a House of Representative’s Banking Committee on an 11-0 vote, but not without some reservations.



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Two of the more experienced legislators in the meeting, Appropriations Chairman Kevin Wallace, R-Wellston, and Rep. Mark Lepak, R-Claremore, fretted about the potential long-term consequences of the increase. They noted the COLAs will come from the funds without an additional appropriation, which is contrary to existing policy.

Wallace pointed out that while the increases would not come directly from appropriations, they would likely extend apportionments going directly to the funds from tax revenue.

Frix presented figures showing the increases would have a very small impact on the pension funds, some of which are already funded in excess of 100 percent of their liabilities.

Assets totaling 80 percent of long-term liabilities are generally considered adequately funded, according to previous expert testimony. Frix said that in some cases ratios in the 70s are considered acceptable.

He pointed out that 100 percent coverage means a fund could pay full benefits in the event everyone in it retired at the same time.

Current ratios range from 68 percent for the firefighters fund to 114 percent for judges. The Oklahoma Teacher Retirement System, by far the largest of the group, is at 72 percent.

The bill now goes to the full House.

Hours after the COLAs were approved, another committee approved a $2,500 across-the-board boost for current state employees. Also passed by the Appropriations and Budget Committee were bills that would raise the minimum pay for state employees and give overtime to salaried workers making less than $37,500 a year.

Appropriations also approved some teacher incentives, including a local option for $5,000 one-time bonuses for former educators who return to the classroom.

Another measure would allow districts to pay student teachers.


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  #402  
Old 03-01-2019, 05:49 AM
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CHICAGO, ILLINOIS

https://www.washingtonpost.com/opini...=.4630549bd360

Quote:
The next Chicago mayor will make history — and face a staggering fiscal challenge

Spoiler:
Chicago’s next mayor will be a black woman. Lori Lightfoot, a former federal prosecutor, and Toni Preckwinkle, the president of the Cook County Board of Commissioners, took the top two positions in the first-round election on Tuesday, beating 12 other candidates, and will advance to the April 2 runoff.

It’s a proud moment for a city with a not-always-proud history of racial tensions. But regardless of who wins, the next mayor will face a monumental challenge: Chicago’s crushing pension burden.

The city has been underfunding its pensions for decades, with dire results. Chicago’s pension plans collectively have only about a quarter of the assets they’ll need to pay benefits, one of the worst funding ratios in the nation. To put that hole in dollar terms, Chicago is about $28 billion short of what it needs, even under relatively favorable assumptions about future returns, or about $10,000 for every man, woman and child living in the city.

The problem could have been even worse. Mayor Rahm Emanuel, who chose not to seek a third term, has managed to halt what had been a free fall in funding levels. But while emergency action may have stabilized things, the patient is still on life support, with radical surgery still needed. Within a few years, pension contributions are projected to suck up more than 20 percent of the city’s budget. And Chicago can’t count on much help from the state, which is dealing with its own, equally severe case of pension underfunding.

From the moment the next mayor takes office in May, she will face fierce pressure. And the rest of the country will be watching, because what’s happening in Illinois is merely the earliest and most extreme manifestation of a quandary that will soon be dominating the public conversation in many states: how to pay for retirement promises to public employees without entering a fiscal death spiral.

Compared with the private sector, oversight for public-pension managers has been almost criminally lax, and the methods that many funds use to calculate their pension liabilities has been preposterously optimistic. The shoddy accounting allowed generations of politicians all over the country to curry favor with public-sector workers by offering them ever-fatter pension packages, gaining immediate benefit while deferring the political cost of paying for all those benefits until much later.

Later is now arriving. Cities and states have to figure out how to pay for all the promises made by their elected predecessors, and none of the choices are good.

Chicago isn’t a poor city like Detroit, unable to pay for its pensions (or much of anything else). It has a robust housing market, and both its per capita and median household income are within striking distance of New York City’s. Moreover, Chicago would seem to have plenty of unused taxing capacity, since the tax burden on its higher-income residents is relatively low compared with that of similar cities.

But Chicago lacks the thing that gives other blue-state behemoths nearly unlimited taxing power: a thick upper crust of ultra-affluent taxpayers sustained by a dominant position in a global industry such as tech, entertainment or finance. Los Angeles can effectively tell its wealthiest taxpayers “Pay up — or try getting your movie produced in Omaha.” Chicago doesn’t have that many rich residents who are so thoroughly captive to geography.

Chicago has been losing lower- and middle-class residents for years, in part because of its heavily regressive tax burden. And when Chicago and Illinois both start raising the rates on upper earners — as they will have to, and soon — they run the risk that those people ,too, will start trickling away, either to smaller cities without the burdensome pension-legacy costs, or coastal cities that can offer the economic benefits of living in a dense urban cluster.

Nor are the alternatives any better. The Illinois Constitution forbids both city and state from cutting pension benefits, and so far it has proved politically impossible to amend. The only remaining choice is cutting services: a good way to drive away taxpayers more interested in regular trash pickup than in paying for the workers of yesteryear, and bad for anyone who stays behind. And thus there’s a real danger that Chicago could find itself caught in a vicious circle, where any measures undertaken to pay the pensions actually make the pensions harder to pay.

This spring, either Lori Lightfoot or Toni Preckwinkle will make history in Chicago. And the next mayor will have a national impact if she can successfully address the city’s looming pension disaster. Because local governments across the country that will soon find themselves in similar straits desperately need a creative leader to show them how to square the vicious circle.


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  #403  
Old 03-01-2019, 06:26 AM
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https://www.bizjournals.com/sanfranc...hoo&yptr=yahoo

Quote:
Warren Buffett discusses ‘disaster’ contributing to Bay Area exodus in CNBC interview

Spoiler:
Warren Buffett described unfunded public pensions as a “disaster” that companies and individuals must consider when deciding where to expand or move.

While corporate America’s traditional, defined-benefit pension plans are no longer the problem they were 10 or 20 years ago, “in the public sector, you know, it’s a disaster,” Buffett told CNBC this week in discussing Amazon’s (NASDAQ: AMZN) decision to ditch New York City for a major expansion.

California’s unfunded public pensions are a hot topic, with taxpayers on the hook for making up any shortfalls in employee contributions or investment returns.

“If I were relocating into some state that had a huge unfunded pension plan, I'm walking into liabilities," Buffett said. "'Cause I mean, who knows whether they're gonna get it from the corporate income tax or my employees — you know, with personal income taxes or what. That liability isn't gonna — you can't ship it offshore or anything like that. And those are big numbers, really big numbers.

“The politicians are the ones that really haven't attacked it in a good many states. And when you see what they would have to do, I say to myself, ‘Why do I wanna build a plant there that has to sit there for 30 or 40 years?’” he said. “They will come after corporations, they'll come after individuals. They're gonna have to raise a lotta money.”

Buffett’s concerns, however, haven’t stopped him from investing in California. Buffett-led Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) is the largest shareholder in San Francisco-based Wells Fargo (NYSE: WFC) and is the outright owner of San Francisco-based Business Wire and South San Francisco-based See’s Candies.

But talk of a Bay Area exodus has been on the rise in recent months as a change in federal tax law means affluent residents of California and other high-tax states likely face bigger tax bills. Plus, the Bay Area has recently lost two Fortune 500 headquarters: San Francisco-based McKesson (NYSE: MCK) and South San Francisco-based Core-Mark Holding Co. (NASDAQ: CORE). Both companies moved to Dallas.


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But Bay Area business leaders are quick to counter such talk, saying the region's economy continues to enjoy dramatic growth, with the nine-county region’s unemployment at levels that are below the national and California averages.

Joining Buffett’s chorus is Berkshire Hathaway Vice Chairman Charlie Munger, a Southern California resident, who criticizes states and cities with high taxes and regulations that make them unattractive to the wealthy.

“Driving the rich people out is pretty dumb, if you’re a state or a city,” Munger told CNBC. “There are a number of places that have shot themselves in the foot — Connecticut, California, New York City.”


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  #404  
Old 03-01-2019, 06:26 AM
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KENTUCKY
http://www.wave3.com/2019/03/01/hund...rt-protest-hb/
Quote:
Thousands of KY teachers show up in Frankfort to protest HB 525

Spoiler:
FRANKFORT, KY (WAVE) - On a day when Jefferson County Public Schools and other districts across the state canceled classes due to teacher call-outs, a House committee approved a bill that would impact the management of the state retirement system for many of those teachers.

House Bill 525 reorganizes the board of trustees for the Kentucky Teachers’ Retirement Systems. The bill made it out of committee Thursday and will continue its way towards a final vote.

Educators marched on Frankfort on Thursday to follow the bill that could ultimately affect their pensions. Teachers said they want to get ahead of any changes that could affect public school education.

Kentucky’s $43 billion pension deficit needs a solution, but many educators say cutting funds to public education is not it.

“They keep throwing out raising taxes [as the alternative] and that gets the public saying, ‘no one wants their taxes raised,’” Crystal Walts-Paulin, a JCPS teacher, said.

Walts-Paulin said even though HB 525 doesn’t address specific pension reform, it’s still a loss for educators.

“The Kentucky Teachers’ Retirement Systems board has traditionally had a lot of representation for teachers, so this is a power grab to take that away from teachers and give it to the governor,” Chris Tobe, a former retirement board trustee, said.

Tobe said it is a mistake for HB 525 to get rid of provisions that ensure educators are on the Teachers’ Retirement System board of trustees.

RELATED STORIES
Pension Bill passes out of House Standing Committee
Parents, business affected by JCPS sickout
Kentucky teachers group calls for statewide ‘sickout’ in protest of HB 525 on Thursday
“We are no longer waiting until they pass something to stand out here and chant into nothing,” Walts-Paulin said. “Now we are going to be part of the process.”

Walts-Paulin said the bill is in its early stages, but the future of public education and her pension is important to her. A line of educators from all over the commonwealth felt similarly.

“Ultimately we are out here because we firmly believe this is best for our students and...best for our schools,” Heather Kirchdorfer, a Fayette County teacher, said. “We just hope that our lawmakers hear us and hear our concerns.”

On Thursday, several districts across the commonwealth canceled school. JCPS officials said 35% of teachers called off in the district. Some teachers said they are willing to call out again.

“We don’t want to be out," Walts-Paulin said. "We hate it, but we also have to take care of public education.”


https://www.wdrb.com/news/wdrb-video...b84891d16.html
Quote:
Pension-related bill passed out of Ky. House despite teacher protests
[video]

http://blogs.edweek.org/edweek/teach...s_sickout.html
Quote:
The Kentucky 'Pension Flu' Has Hit Teachers Once Again
Spoiler:
The "pension flu" is coming around again—thousands of Kentucky teachers called out sick on Thursday to protest legislation, forcing at least eight school districts to close.

Teachers are protesting a bill that would restructure the board that oversees the state's teacher pension system. Currently, the board has seven members—four who are teachers (and are nominated by educators who contribute to the pension system), one who is a retired teacher, and two who are not in the teaching profession. The bill would scrap the election process, and have seven statewide groups choose a member instead. Five of those groups are education-related, but only two are associations of current educators, according to the Courier-Journal.

The state's two largest school districts—Jefferson and Fayette Counties—are among the districts forced to close because of a lack of substitutes to cover the number of teacher absences.

Last year, Kentucky teachers rallied at the state Capitol on three separate occasions to protest changes to the state's retirement plan. Schools were forced to close then, too. The sickout this year was called for by the grassroots group KY 120 United, which led the protests last year.

"We show up every day in the classroom with a lot of passion, but sadly passion will not substitute for our pension or our paycheck. It has been crystal clear for over a year that public education, teachers, and our public pensions are under attack. Enough is enough," KY 120 United posted. "This isn't about just one bill but a series of events that have transpired over the past year."

Kentucky's pension system is one of the worst-funded in the nation, and fixing it has been a priority for lawmakers. Last year, they moved new teachers to a "cash-balance" plan, which is a hybrid of a traditional defined-benefit pension and the kind of 401(K) retirement savings plan common in the private sector. That will help ensure that the state does not accrue additional unfunded liabilities. In addition, school districts are now expected to contribute 2 percent of teachers' salaries to their pension plans, on top of the contribution from the commonwealth.

See also: Costly Pension Plans Are Fanning the Flames of Teacher Unrest

While the legislation that ultimately passed did not include any significant changes to current teachers or retirees' benefit plans, it still angered many teachers, who are now watching legislators very closely. The Kentucky Education Association has called the bill to restructure the pension system's board a "retaliatory effort" for last year's protests.

Although the state teachers' union did not sanction the sickout, it posted on Twitter a quote from community organizer Fannie Lou Hamer: "I'm sick and tired of being sick and tired."

Kentucky was part of a rash of widespread teacher activism last year that has continued into 2019 as well. In addition to big-city teacher strikes in Denver, Los Angeles, and now Oakland, Calif., West Virginia teachers repeated their activism last year with another two-day strike this month over a school choice bill.

In Kentucky, state Rep. Travis Brenda, a high school math teacher who was elected to the legislature as a Republican last year, posted on Twitter that the bill that sparked the protests is currently in its first draft. The "updates that are in the works," he said, "will be dramatically better."

Image: Kristin Walker, a Jefferson County teacher, sits in a hearing room waiting to protest the passage of a bill that would change how individuals are nominated to the Kentucky Teachers' Retirement System's board of trustees. —Bryan Woolston/AP


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  #405  
Old 03-01-2019, 06:27 AM
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KENTUCKY
ILLINOIS

http://www.governing.com/topics/fina...m_medium=email

Quote:
The Drastic, Risky, Measures to Fix America's Brokest Pension Systems
Kentucky and Illinois are weighing extreme options to reduce their pension debt -- but critics say they could ultimately cost the states more.

Spoiler:
Kentucky and Illinois have two of the worst-funded pension plans in the country, and they’re struggling under the weight of skyrocketing costs. Both are now considering drastic measures to ease the annual burden in ways that critics say will ultimately make the problem worse.

In Kentucky, where teachers staged a "sickout" on Thursday over separate pension legislation, an unusual, if not unprecedented, bill is making its way through the legislature that would allow regional colleges, universities and other quasi-government institutions to leave the state's troubled pension system without immediately paying off their debt. Instead, they could pay it off over 25 years. Employers leaving the fund would be required to provide other retirement options for their employees, such as a 401(k).

The legislation is being pushed by the presidents of the regional universities as increasing pension costs are squeezing their budgets and forcing them to raise tuition.

RELATED
These Pension Funds Invest Millions in Private Prisons Should Pensions Own Utilities? Congress Has Considered It Before. Pensions Are Shelling Out Billions in Fees -- and It's Not Paying Off In Kentucky, Pension Reform Fails (Again)
But ditching the plan without a lump sum payout is a move that actuaries have warned could threaten the solvency of the $2 billion plan.

“We believe that enacting this provision will result in substantial sustainability risk as other employers lobby for the enactment of similar type legislation to reduce their pension cost,” GRS Retirement Consulting said in a report last week.

Jim Carroll, co-founder of the advocacy group Kentucky Government Retirees, is worried that the government employers that don't leave the pension system will ultimately pay the price.

“This makes a bad problem worse by incentivizing employers to leave,” he says. “You could end up with a bankrupt plan, and how does that help anything?”

Kentucky’s state employees plan has been in a freefall for more than a decade, despite major reforms. Over the past 10 years, it’s gone from paying the equivalent of 6 percent of its payroll costs toward pensions to roughly half last year. (The average among all states is less than 15 percent.) During that time span, the state plan has gone from having about 60 percent of the assets it needs to meet its liabilities to just 13 percent.

A big reason costs have spiked recently is because the pension system changed the way it values its liabilities. That’s resulted in a roughly one-third increase in pension payments for government employers. The state’s regional colleges and universities have been allowed to phase that in, but they’re worried about future hikes. The schools say the strain has already forced them to increase tuition, which is making college unaffordable for middle- and lower-class families.

The bipartisan bill passed the Kentucky House this week by a wide margin and is now before a Senate committee. Gov. Matt Bevin has stayed quiet on the bill, but he previously vetoed legislation that would have allowed government agencies to exit the state-run, county employees pension plan.


Illinois Gov. Pritzker's Pension Plan
In Illinois, pension costs are similarly overwhelming. Newly elected Gov. J.B. Pritzker’s administration is pushing a plan that -- if it fails -- could result in Illinois being the first state in the modern era to be downgraded to junk status.

Facing a $3.2 billion budget deficit, Pritzker wants to extend the schedule for paying off the state's pension debt by seven more years. He says the change would save $800 million a year.

That sort of delaying the inevitable is exactly what got Illinois into its current pension crisis and, S&P Global Ratings warned this week, “has been a key contributor to Illinois’ deteriorating credit position,” which is one notch above junk. “If it adopts the budget in its current form,” the agency continued, “it remains at risk of repeating a pattern of putting off hard choices while eroding pension funding.”

The plan would put a huge dent in the state’s pension payment, which is scheduled to be $9.1 billion next year, or roughly 21 percent of the budget. (The average among all states is about 6.5 percent, according to the Center for Retirement Research.) The state employees plan, which represents about one-third of that $9.1 billion payment, is in the worst shape -- over 10 years, it has gone from 54 percent funded to just 35 percent. Meanwhile, the state's annual payments into the plan have nearly tripled.

Pritzker’s administration is also looking at reducing the pension system’s unfunded liability by issuing $2 billion in bonds and is evaluating publicly owned assets to sell or repurpose. Proceeds from bond and asset sales or transfers would go into the pension plan to pump up the value. The administration is pitching an income tax hike on higher-earners to help pay off the bonds.

Analysts characterize those ideas as big risks that have a high chance of not paying off.

Pritzker's budget plan faces long odds as conservatives criticize it for relying on new taxes, and progressives say it doesn't go far enough to tax the wealthy and corporations.


Comparing Kentucky and Illinois
Illinois and Kentucky share some key similarities that contribute to how they got here.

For starters, neither state paid its full pension bill for years, which is akin to skipping credit card or mortgage payments and letting the interest pile up. While many other states did the same, Illinois and Kentucky neglected pensions to the point where they were already unhealthy by the time the recession hit in 2008 and severely damaged plans.

Both state employees plans also have more retirees than active employees, which means they are paying out more money than they are taking in most years.

But when it comes to turning things around, the states face different barriers.

Illinois' obstacles are generally legal and political. Protections for worker pensions are fierce and, barring a change to the state constitution -- which is likely difficult -- Illinois will be hard-pressed to find ways to reduce its retirement liabilities.

Kentucky’s biggest barrier is time. Its state employees' plan has been cash-flow negative for more than a decade. Following pension reform, it reduced its liabilities and has for the past three years met or exceeded its payments. But according to actuaries, Kentucky must continue to overpay for years to keep the plan solvent. Any slight shift in finances could derail the fund.
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Old 03-01-2019, 06:34 AM
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ILLINOIS

https://chicagounbound.uchicago.edu/...0&context=uclf

Quote:
Illinois’s Impending Pension Insolvency: Could
Public Pensions Off-Load Risk onto Private
Insurers?
It's a legal review paper, so it doesn't have an abstract. ... I'll just copy the conclusion

Quote:
VII. CONCLUSION
Public pensions have been a symbol of stability for workers in Illinois and throughout the country for over a century. The government
promised employees pensions in return for their life’s work. Generations of employees have contributed to the vitality of civic society
through public work and are owed their dues—as a matter of public
policy and law.
In order to find solutions to the problems facing public pensions
today, reformers must learn from the past—the abuses that have led
us here and the efforts to remediate that fell short. This Comment
seeks to illustrate where Illinois stands as a matter of law and financial need. These two elements together serve as the necessary ingredients to develop a workable model for reforming the state system.

Rather than “re-invent the wheel,” reformers can look to successes
achieved for similar purposes. Like the problem at hand here, private
pensions have struggled to maintain secure funding. While the private
pension context is not perfect, the federal structure of ERISA has, for
the most part, been successful. The creation of the government backed
insurance system, the PBGC, might serve as a model for a similartype system to be created for states. The implementation of regulations to police this new third-party insurer appears to also present
strong starting points for further research.
In addition to identifying the ways a public pension system might
benefit from these proposals, similar considerations will need to be
made for how they might raise new challenges such as increased burdens on the federal government or increased administrative costs in
setting up the system.
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Old 03-01-2019, 06:34 AM
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ALASKA

https://www.teacherpensions.org/blog...vidence-alaska
Quote:
What Happens When a State Gets Rid of Its Teacher Pension Plan? Evidence from Alaska
Spoiler:
Our news cycle is lightning quick. Proponents and naysayers alike are often loudest just prior to a policy change’s implementation, before moving on to tackle the next one. But what happens after the dust settles? Were the changes as meaningful as supporters hoped? Were ramifications as cutting as detractors warned? We don’t always get the chance to go back and check.

Alaska’s 2005 teacher pension system reform legislation provides a unique opportunity to do just that. We’ve collected pre and post reform data to examine teacher workforce impact in the wake of retirement plan changes. While it is important to note that these trends should not be interpreted as causal, we feel there are meaningful takeaways all the same.

But first, some history. In a 2005 special session, the Alaska state legislature passed retirement reform laws, effectively freezing the state’s existing defined benefit pension plan, and enrolling new employees in a 401(k)-styled defined contribution plan. The state faced a $5.7 billion unfunded liability, and while changing the plan structure would not eliminate that debt, it would prevent it from snowballing further. Critics were concerned that the switch would cause teachers to leave the profession in droves, or never enter it at all, citing pensions as a key recruitment and retention incentive.

So what actually happened? Not much. The table below tracks the average Alaska teacher salary, the number of teachers in the state*, and the percentage of Alaska teachers leaving their district in a given year. The 2005-06 school year is highlighted to denote the policy change. Alaska’s average teacher salaries have risen steadily from 2002 to 2012. The number of teachers has fluctuated over that time, but remained largely consistent.

Alaska-blog-1.PNG

And teacher turnover, one of the biggest concerns going into the reform, has remained steady as well. The chart below tracks the percentage of Alaska teachers who left their district each year (including those who leave the profession entirely or moved to a different school), and highlights the new hire cohort first enrolled in the new retirement system. Warnings of dramatic teacher shortages in the wake of retirement plan changes have not come to pass.


Alaska-blog-2.PNG

This is not to say that Alaska’s reform is a perfect exemplar. The DC plan sets decent contribution rates, with a mandated 8 percent employee contribution and a 7 percent employer contribution, but in passing the 2005 reform legislation, the state missed an opportunity to extend Social Security coverage to its teachers. As a result, Alaska teachers continue to be uncovered, putting their retirement security at risk. The plan isn’t ideal, but it does offer better benefits to a larger group of mobile workers, and it should help keep the state’s finances stable over the long-term.

Pensions make up an increasing portion of a state’s education spending and any changes to the plans must be balanced to both do right by new hires as well as uphold promises made to existing employees. There are no easy answers, but taking opportunities to examine results in case studies like Alaska allow future policy makers to cut through some of the discourse.


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Old 03-01-2019, 06:37 AM
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WEST WARWICK, RHODE ISLAND

https://www.usnews.com/news/best-sta...-pension-board

Quote:
Police Seek to Remove Convicted Felon From Pension Board
West Warwick Police Union president says officers want a convicted felon who was appointed to town council to either resign or be removed.
Spoiler:
WEST WARWICK, R.I. (AP) — The president of the West Warwick Police Union says officers want a convicted felon who was appointed to town council to either resign or be removed.

WPRI-TV reports Mayor Ernest Lavigne told the council that Jerry Leite's no contest plea to embezzling donations for a murdered officer's charity event makes his conviction "even more alarming."

Leite was appointed to the council's pension committee by a 4-1 vote Feb. 5.

Three council members say they didn't know Leite was a convicted felon, and two others have not responded to requests for comment.

The town charter states no one convicted of a felony is eligible for employment or appointment to any position in town.

Leite says he will not resign, and he will serve with integrity.
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Old 03-01-2019, 06:38 AM
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PENNSYLVANIA
DIVESTMENT
ESG

https://triblive.com/news/pennsylvan...prison-stocks/

Quote:
Union wants Pennsylvania school pension fund to divest private prison stocks

Spoiler:
The American Federation of Teachers, or AFT, is calling on Pennsylvania’s $56.2 billion school employees’ retirement fund (PSERs) and 23 other large pension funds to consider divesting their stock in private prison corporations.

A new AFT report found that PSERs is among two dozen public pension funds that own a combined $75 million in investments in CoreCivic and GEO, the nation’s largest public prison corporations, Governing magazine reported.

The union cautioned that such investments not only support private prisons, which lack the oversight mechanisms of the federal prisons and include immigration detention centers, but also expose the pension funds to public relations and legal issues that could affect the value of such investments.

PSERs spokeswoman Evelyn Williams said she had yet to hear of any specific calls for divestment to PSERs. She said the pension fund does not invest or divest based on concerns about social issues.

“Those investments are part of the SP 400 index … meaning anyone that passively invests in the SP400 index would hold those investments just like PSERs,” Williams said. “The few times we have divested — like Sudan and Iran — in the past required legislation to be passed.”
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Old 03-01-2019, 06:39 AM
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ILLINOIS

https://www.mdjonline.com/neighbor_n...6287d9b63.html
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Retirees object to governor's pension holiday plan

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The Illinois Retired Teachers Association is critical of Gov. J.B. Pritzker’s proposal to pay more than required into the pension system for Chicago teachers while underfunding the pension system that serves the rest of the state's retired teachers.

Pritzker proposed changing the state’s payment schedule for its underfunded public retirement accounts. In exchange for paying more in years ahead, he’s proposing shorting the required contribution for teachers outside of Chicago by $500 million.

“Delaying pension payments just kicks the can down the road again and costs future generations of Illinois taxpayers (if any left) billions of dollars,” Illinois Retired Teachers Association President Roger Hampton said in a statement.


Association Executive Director Jim Bachman said Pritzker's promise of higher payments later is not new. Teachers have heard it before from both Democratic and Republican governors.

“This is the same road that we’ve gone down many times,” he said.

During the campaign, Pritzker repeatedly said he wanted to pay more into pensions. He said that to Crain’s Chicago Business and repeated it during the debates.

“He said it was his intent to be putting more into the system, if possible, to reduce that debt, but in lieu of that we went the opposite way,” Bachman said.

The association said that while Pritzker is proposing a $576 million pension holiday for the Teachers' Retirement System of the State of Illinois, the Chicago Democrat is also proposing a nearly $20 million increase to contributions to the Public School Teachers’ Pension and Retirement Fund of Chicago.


“You’re fulfilling your thoughts or promises to the Chicago teachers, but you’re not doing that for downstate,” Bachman said. “This worries me that we’re going to continue to do this.”

In total, Illinois has more than $135 billion in unfunded pension liabilities. If the state maintained its actuarially required contributions for the coming fiscal year, it would amount to nearly a quarter of the state's budget.

There has been a debate about whether or not to classify the state’s pension underfunding as a “crisis.” Bachman said the amount of money TRS controls will allow the system to continue to make payments to its 417,000 retirees, but he said he thinks the cost to future generations is the real crisis.

“Somebody in the future is going to have to pay for it,” he said. “In that sense, yeah, it is a crisis.”

The IRTA endorsed Pritzker over former Gov. Bruce Rauner in last y
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