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  #21  
Old 01-03-2017, 12:24 PM
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http://nypost.com/2017/01/03/outgoin...e-dip-pension/

Quote:
Outgoing Port Authority exec to cash in with double-dip pension

The outgoing head of the Port Authority is set to receive a retirement benefit reserved for just him and about 50 other execs at the scandal-scarred agency — a double-dip pension, The Post has learned.

Executive Director Pat Foye and administrators of the PA’s PATH system were deemed eligible to collect pensions from both New York and the federal Railroad Retirement Board under a questionable “legal finding” by the authority’s lawyers, sources said.

The PA wouldn’t reveal how many former executives are currently pocketing dual pensions or are in line to get them, or even say when the double-dipping began.

But the situation is under investigation by both PA Inspector General Michael Nestor and state Comptroller Tom DiNapoli, who thinks it’s “troubling” and “possibly illegal,” sources said.

A DiNapoli spokeswoman confirmed that “the matter is currently under review.”

In addition to Foye, those set to receive dual pensions include former Executive Director Tony Shorris, who is now the city’s first deputy mayor under Mayor de Blasio, sources said.
.....
Revelation of the double-dipping comes as a former PA official, Bill Baroni, awaits sentencing in the New Jersey Bridgegate scandal, and just weeks after The Post exposed PATH workers sleeping on the job while racking up overtime pay.

Tim Hoefer of the Empire Center for Public Policy called the dual pensions a “major problem” that could wind up costing the bi-state PA millions.

“You can’t imagine any scenario in which two pensions are being paid to the same individual for the same job that are being back-stopped by the public,” Hoefer said.

“It’s not good stewardship of either system to allow an individual to collect pensions from both entities.”
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Old 01-03-2017, 12:38 PM
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DALLAS POLICE AND FIRE
TEXAS

Quote:
Originally Posted by campbell View Post
http://www.texasstandard.org/stories...-pension-fund/

Quote:
TEXAS RANGERS TO INVESTIGATE DALLAS POLICE AND FIREFIGHTER PENSION FUND

Over the last few months, the Dallas Police and Fire Pension System has tanked, with reports saying the fund turned into a catastrophe after a string of bad real estate investments. To make matters worse, participants attempted to withdraw hundreds of millions of dollars, forcing Dallas Mayor Mike Rawlings to take legal action to stop the bleed off. Now Rawlings is asking for a full-blown criminal investigation led by the Texas Rangers.

Tristan Hallman, reporter for the Dallas Morning News, says the Texas Rangers have also expressed that they’re ready to start the investigation, which is unusual. The FBI is looking into transactions related to the pension fund. And the pension fund hired a law firm to look into what went on.

“Some people think this might be redundant, others say what’s one more law enforcement agency at the party here,” Hallman says. “But this also comes right before [the city] wants to go to the state legislature and propose their own solution on how to fix the pension fund.”

The legislature has ultimate control, Hallman says. The fund isn’t governed by the city, so they don’t get to make the decisions in terms of how to fix it. The legislature can’t force the city to bail out the pension fund but can impact the solution.

Hallman says there’s a benefit to Rawlings drawing attention to the pension fund’s previous actions. It’s possible that he’s pulling out all the stops so he can avoid saddling the city with the burden of having to cover massive losses and avoid bankruptcy.

“The mayor has made clear in the past that the city should not be on the hook, should not be liable for this, but will participate in the solution,” he says. “That seems to fit with what he’s doing here.”

The problem with the fund that exacerbated some of the overly generous benefits paid out over the years was that they invested heavily in non-traditional real estate, Hallman says. The fund had to write down some very significant losses within in the past few years.

“They had massively overvalued it,” Hallman says. “They didn’t follow accounting standards so the criminality, you would think, would be somewhere in there if it exists.”
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Old 01-03-2017, 01:24 PM
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TEXAS

http://www.battleswarmblog.com/?p=29693

Quote:
Interview with TPPF’s James Quintero on the Texas Municipal Pension Debt Crisis
James Quintero, the Director of the Center for Local Governance at the Texas Public Policy Foundation, was kind enough to provide some detailed answers to questions I sent him about the municipal pension crisis in Dallas and other large Texas cities. My questions are in italics.

The Dallas police/fireman’s pension fund issue is generally described as stemming from the fund manager’s risky real estate speculation. Are there any additional structural problems that helped hasten that fund’s crisis?
When it comes to Texas’ public retirement systems, one of my greatest concerns is that there are other ticking time-bombs, like the DPFP, out there getting ready to explode. It’s not just Dallas’ pension plan that’s taken on excessive risk to chase high yield in a low-yield environment.

Setting aside the issue of risk for a moment, the DPFP, like most other public retirement systems around the state, suffers from a fundamental design flaw. That is, it’s based on the defined benefit (DB) system, which guarantees retirees a lifetime of monthly income irrespective of whether the pension fund has the money to make good on its promises or not. This kind of system is akin to an entitlement program, warts and all, and is very much at the heart of pension crises brewing in Texas and across the country.

One of the biggest problems with DB plans is that they rely on a lot of fuzzy math to make them work, or at least give the appearance of working. Take the issue of investment returns, for example. Many systems assume an overly optimistic rate of return when estimating a fund’s future earnings. Baking in these rosy projections is, among other things, a way to understate a plan’s pension debt. In an October 2016 study that I co-authored with the Mercatus Center’s Marc Joffe, I wrote the following to illustrate this very point:
Quote:
For example, the Houston Firefighters’ Relief and Retirement Fund (HFRRF) calculates its pension liability using a long-term expected rate of return on pension plan investments of 8.5%. During fiscal year 2015, the plan’s investments returned just 1.53%. Over a 7- and 10-year period the rates of return were 6.4% and 7.9%, respectively. Not achieving these investment returns year-after-year can have a dramatic fiscal impact.

Even a small change in the actuarial assumptions can have major consequences for the fiscal health of a pension fund. According the HFRRF’s 2015 Comprehensive Annual Financial Report, a 1% decrease in the current assumed rate of return (8.5%) would almost double the fund’s pension liabilities, from $577.7 million to $989.5 million.
.....
Compared to the Dallas situation, how badly off are the Houston, Austin and San Antonio public employee pension funds?

If you’re a taxpayer or property owner in one of Texas’ major cities, I’d be concerned. Moody’s, one of the largest credit rating agencies in the U.S., recently found that: “Rapid growth in unfunded liabilities over the past 10 years has transformed local governments’ balance sheet burdens to historically high levels,” and that Austin, Dallas, Houston, and San Antonio had a combined $22.6 billion in pension debt—and it’s growing worse!

Using the Pension Review Board’s latest Actuarial Valuations Report for November 2016, we can parse the systems within each municipality to get a little bit better sense of where the trouble lies. Pension debt for the retirement systems in the big 4 looks like this:

Austin Employees’ Retirement System: $1.1 billion, Austin Police Retirement System: $346 M, and Austin Fire Fighters Relief and Retirement Fund: $93 M;
Dallas Employees’ Retirement Fund: $809 M, Dallas Police and Fire Pension System—Combined Plan: $3.3 B, and Dallas Police and Fire Pension System—Supplemental: $23 M;
Houston Municipal Employees Pension System: $2.2 B, Houston Firefighters’ Relief and Retirement Fund: $467 M, and Houston Police Officer’s Pension System: $1.2 B; and
San Antonio Fire and Police Pension Fund: $360 M.
Of course, it’s important to keep in mind that the figures use some of the same fuzzy math as described above, so the actual extent of the problem may be worse than the PRB’s latest figures indicate.

.....
California pensions were notoriously generous (20 years and out, spiking, etc.). Do any Texas state or local pensions strike you as unrealistically generous?

Any plan that’s making pension promises but has no plan on how to make good on those promises is being unrealistically generous. And unfortunately for taxpayers and retirees alike, a fair number of plans can be categorized as such.

The Pension Review Board’s Actuarial Valuations Report for November 2016 reveals that of Texas’ 92 state and local retirement system, only 4 of them are fully-funded. At the other extreme, a whopping 19 of the 92 plans have amortization periods of more than 40 years. Six of those 19 plans have infinite amortization periods, which effectively means that they have no plan to keep their promises but are instead planning to fail.

As far as specific plans go, there’s no question that the Dallas Police and Fire Pension System is the posterchild for the overly generous. The Dallas Morning News recently covered the surreal levels of deferred compensation offered, finding that:
Quote:
The lump-sum withdrawals come from the Deferred Retirement Option Plan, known as DROP. The plan allows veteran officers and firefighters to essentially retire in the eyes of the system and stay on the job.

Their benefit checks then accrue in DROP accounts. For years, the fund guaranteed interest rates of at least 8 percent. DROP made hundreds of retired officers and firefighters millionaires. And once they stopped deferring the money, they received their monthly benefit checks in addition to their DROP balance. [emphasis mine]
It’s probably fair to say that any public program that makes millionaires out of its participants is probably being too generous with its benefits.

.....
n the Texas Public Policy Foundation’s 2017-18 Legislator’s Guide to the Issues, I cover this issue in a little more detail. In the article (see pgs. 122 – 124), I write of these plans’ fiscal issues which can be seen below, albeit with slightly older data.


Looks like the color-coding is keying off the dreaded 80%.

(I assume this, because this guy has showed up in my 80% hall of shame before....

oh, and it says right below the graphic)

Quote:
(Funded ratios marked in red denote systems that are below the 80% threshold, signifying a plan that may be considered actuarially unsound. Source: Texas Bond Review Board.)
Let's check the Texas Bond Review Board link
http://www.prb.state.tx.us/about/age...ationsreports/

I get a 404 not found from that link

ooh, here we go:
https://www.comptroller.texas.gov/ap...pension/search

Nice!

I didn't see where the 80% is coming from, but I can look for it later.
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Last edited by campbell; 01-03-2017 at 01:39 PM..
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  #24  
Old 01-03-2017, 01:41 PM
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Mary Pat Campbell
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NEW JERSEY

Other data source:

https://data.nj.gov/browse?Governors...a=Pension+Data

https://data.nj.gov/dataset/YourMone...2016/6n22-63a4
https://data.nj.gov/dataset/YourMone...bers/44xg-bswk

etc.

thanks to John Bury for pointing this out:
https://burypensions.wordpress.com/2...y-is-going-to/
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Old 01-03-2017, 01:53 PM
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Quote:
Originally Posted by campbell View Post
TEXAS

http://www.battleswarmblog.com/?p=29693





Looks like the color-coding is keying off the dreaded 80%.

(I assume this, because this guy has showed up in my 80% hall of shame before....

oh, and it says right below the graphic)



Let's check the Texas Bond Review Board link
http://www.prb.state.tx.us/about/age...ationsreports/

I get a 404 not found from that link

ooh, here we go:
https://www.comptroller.texas.gov/ap...pension/search

Nice!

I didn't see where the 80% is coming from, but I can look for it later.
The Texas Bond Review Board doesn't oversee pension plans and as far as I know doesn't opine on pension plan funding. The Texas Pension Review Board does and AFAIK they have never used the 80% threshold (or any funded %) as a specific measure. The PRB has historically focused on amortization period.
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Old 01-03-2017, 02:13 PM
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Originally Posted by Kenny View Post
The Texas Bond Review Board doesn't oversee pension plans and as far as I know doesn't opine on pension plan funding. The Texas Pension Review Board does and AFAIK they have never used the 80% threshold (or any funded %) as a specific measure. The PRB has historically focused on amortization period.
I just noticed the link is taking you to the Pension Review Board website, not the Bond Review Board site. The new page is http://www.prb.state.tx.us/about/publicationsreports/.

I think the guy from TPPF is being a bit disingenuous with his statement and the attempt to link it to the PRB given he has a pretty clear policy outcome he is trying to push. The PRB has published The Guidelines for Actuarial Soundness, which is where the phrase "actuarially sound" likely comes from, but it does not mention funded ratio at all.

The only recent discussion funded ratio as a measure of performance I know of comes from the 2014 Financial Health Study and basically says it isn't sufficient to look at by itself.

Quote:
Funded Ratio
Some consider a funded ratio of at least 80% to signify overall financial health and a funded ratio of less than 60% problematic. Others would consider a funded ratio of 100% to be desirable. The funded ratio alone, however, may not provide enough insight into the overall financial health of a retirement system.

Newly formed retirement systems, for example, will have low funded ratios for some time as they build the value of their trust funds. Additionally, retirement systems with the same funded ratio may be in different positions to meet their long-term obligations. A retirement system’s funded ratio is only a onetime snapshot of the system’s asset to liability measurement and does not provide any trend-related information. Therefore, funded ratio should be evaluated in conjunction with a system’s amortization
period.
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Old 01-03-2017, 02:50 PM
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Thanks for hunting down the proper link.

If you go to this link:
https://www.comptroller.texas.gov/ap...pension/search

and then do a search on all plans, you get this text at the top:

Quote:
Assessing financial stability:

A standard measure of the financial health of any pension fund is its funded ratio, which is the ability of the plan’s current assets to cover promised benefits. A funded ratio of 100 percent or more means a plan is fully funded; some actuaries believe this is the only healthy plan condition.

The funded ratio also should be considered in light of a plan’s amortization period, which is the length of time required to pay off a plan’s current pension benefits earned to date plus an unfunded liability, based on current contributions. As of 2012, the Governmental Accounting Standards Board (GASB) recommends an amortization period of no more than 30 years. The Pension Review Board considers plans with an amortization of 40 years or more to be actuarially unsound.

Many experts also compare a plan’s assumed and actual Rates of Return to measure long-term stability. Lower Rates of Return over time will reduce a plan’s ability to meet its obligations unless employee/employer contributions are increased.
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Old 01-04-2017, 01:38 PM
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MIDDLETOWN, NEW JERSEY

http://www.app.com/story/news/educat...sion/96103956/

Quote:
Middletown schools owe pension system $3.8M

Middletown Township School District owes a pension fund $3.8 million — the extra costs associated with an unapproved early retirement incentive program implemented nearly a decade ago, a state appellate court has ruled.

The ruling is the latest chapter in a legal battle that has continued since 2008, over a program designed to save property owners money but now portends to saddle them with unexpected costs — upward of $3.8 million.

District business administrator Amy Gallagher told the Press that the board will discuss the ruling and resulting charge at Wednesday night's reorganization meeting. The tab stems from decisions made nearly 10 years ago.

In October 2007, the school board agreed to offer sick-time payouts of up to $40,000 to tenured or near-tenured staff, hoping to entice these higher-paid employees into early retirement, according to court documents. Forty-one staff members said yes.

While the retirement incentive did not increase the size of payments to the pensioners, these retirees would begin collecting earlier — and for longer — than they would have without the offer. This caused the state Treasury Department's Division of Pension and Benefits to object.
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Old 01-04-2017, 01:39 PM
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MICHIGAN

http://www.miningjournal.net/news/fr...n-liabilities/

Quote:
Pension Problems: Breaking down state pension liabilities

The first in a six-part series on the state of pensions in Michigan

– At just 61.6 percent funded, Michigan ranks 39th nationally for the health of its public pension system, according to a report by the Wall Street Journal

MARQUETTE — A perfect storm has converged around public pension plans, putting municipalities, schools, administrators and legislators in a bind over how to rebuild and fund benefits sustainably into the future.

With costs rising to meet the growing liability, public entities are facing difficult decisions.

“You start playing this game of, well, what’s more important — should we pave this road or pay this extra retirement contribution?” said Marquette City CFO Gary Simpson.

Unfunded accrued pension liability is the difference between the total amount due to both retirees and current employees upon retirement, and the actual amount of money the system has on hand to make those payments.

Negaunee City Manager Jeff Thornton said the impact of unfunded pension liability is being felt in cities across the state. For instance, downstate Port Huron led a conference call on unfunded liability with the Michigan Municipal League a couple months ago, he said.

“They actually said on the phone call that if something doesn’t change, they will be bankrupt in three years,” Thornton said.

Concerns about growing liability are reaching a fever pitch because of a complex web of pressures on the system, which this series will seek to untangle while shedding light on local challenges and efforts to pay down the looming burden.

By state

At just 61.6 percent funded, Michigan ranks 39th nationally for the health of its public pension system, according to a report by the Wall Street Journal that looked at 2013-14 data from the Bureau of Economic Analysis and the National Association of State Retirement Administrators.

NASRA says a minimum funding target for states should be 80 percent, though 100 percent is the goal.

Two states, Wisconsin and South Dakota, are 100 percent funded, while Washington, North Carolina and Oregon are more than 95 percent funded.
Ah, gotta add it to my list
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Old 01-04-2017, 01:43 PM
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ILLINOIS

http://www.mywebtimes.com/news/local...dcdc821d8.html

Quote:
The State Retirement Systems of Illinois acknowledged Tuesday it provided incorrect information about former state Rep. Frank Mautino's pension earlier this year.

According to that information, Mautino, D-Spring Valley, was slated to receive a nearly $60,000 jump in his pension after a year as the state's auditor general.

But a spokesman for the retirement systems said Tuesday the increase actually will be about $19,000. The earlier mistake came to light in September, he said.

The Times discovered the new numbers after Mautino's spokesman questioned the previous ones in a response to an email from a reporter.

If Mautino had left state employment as a legislator, he would have collected a $74,482 pension starting in August, when he turns 55, said Jeff Houch, a spokesman with State Retirement Systems. After a year as auditor general, Mautino will be able to draw a $93,793 pension, Houch said.

"I would like to apologize for giving you faulty information before," Houch told The Times, noting the complexity of the state's pension systems.

The retirement system had given the same information to state Rep. Jeanne Ives, R-Wheaton, who spread the numbers to conservative media.

The pension agency, Houch said, miscoded Mautino as a Tier 1 employee, which means he was hired before Jan. 1, 2011, and would get greater benefits. But Mautino should have been classified as Tier 2, in which those hired on or after Jan. 1, 2011, receive less, Houch said. Mautino was Tier 1 as a legislator, Tier 2 as auditor general.


"Very rarely do you see someone who is Tier 1 in one system, but Tier 2 in another," Houch said.

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