Recommendations proposed by State Treasurer Beth Pearce would reduce the pension fund shortfall and maintain defined benefits. However, the retirement payout for current employees would likely be smaller, while the shortfall would be reduced by “only” $2.2 billion. The entire pension fund shortfall is $2.9 billion.
The total of the two pension funds and expected OPEB obligations went from $4.637 billion a year ago to the present $5.657 Billion. That’s an increase in required expenditures of over a billion dollars in a single year. How did we get to this dismal situation?
Faced with a $2.2 billion shortfall of unfunded financial obligations, New Hampshire entered the current pandemic playing catch-up and could face more challenging headwinds in the future, a new report states.
The retirement system ranked 54th on a list of 148 state and local retirement funds nationwide with at least $2 billion in assets. The list, which includes pension systems in every state except Vermont, lists pension funds from fiscally weakest to strongest.
The state needs an independent analysis of these plans that will test not only the state’s ability to pay for our liabilities under different market and economic situations, but will ensure that the participants will get the promised benefits. And this test needs to be conducted on a regular basis.
Vermont’s pension debts are much bigger than politicians have admitted. The Democrat and Progressive establishment that runs Vermont has used fake accounting to downplay the vast extent of our state’s unfunded obligations.
The politicians who created this problem are slow to take up the task of fixing this because the numbers are huge. But who should take the hit: taxpayers or union members? Actually, morally speaking, neither.
The Ethan Allen Institute has been working with the Business Roundtable’s Pension Reform Task Force to better understand the problem of our state’s $4.5 billion pension liability and to explore some possible paths to a solution. The 31-page report resulting from this study came out in January.
Worse, if Congress bails out private union pension plans, how will it say no to teachers, police and firefighters who come to the federal government asking for a bailout of their state and local pensions that have an estimated $4 trillion to $6 trillion in unfunded pension promises?
In all seriousness, how do our representatives expect us to pay for all of this? There are only about 320,000 taxpayers in Vermont. This ever-growing burden on so few shoulders is crushing. It has to stop.
In the 12th episode of “Travels With Charlie – Vermont Politics in Real Life,” host Charlie Papillo discusses Vermont’s growing pension crisis with economist Art Woolf and David Coates, retired managing partner at KPMG.