A new national study of the
nation's 100 largest public pension plans once again shows Oregon PERS to be
among the best funded in the United States.
This latest study was
commissioned and released by Milliman, one of the world's largest independent
actuarial and consulting firms. The study reviewed 100 of the nation's largest
public defined benefit pension plans, offering an aggregate analysis of these
100 public pensions and their funded status. Milliman's has done a corporate
pension funding study for the past 12 years, but this is its first
complementary public pension analysis.
"Milliman is in a unique
position to serve as the actuarial fact checkers for the self-reported interest
rate and liability information provided by public pensions," said Becky Sielman,
author of the Milliman Public Pension Funding Study. "Our approach was to start
with a clean slate and recalculate each plan's liability with an eye toward an
PERS Coalition attorney Greg
Hartman, who has reviewed the Milliman findings, says Sielman's group took
extra steps to ensure an accurate review of the public pension funds.
"If someone complains that
prior comparative studies are not accurate, this is the place to send them,"
says Hartman. "Without trying to get too technical, one of the difficulties of
doing comparative studies of the funding of public sector plans is the lack of
uniformity in assumptions and the valuation of assets. In this study, Milliman
tries to normalize those factors by using market values and using their
own actuarial assumptions, which are then uniformly applied.
"The bottom line, not
surprisingly, is that the Milliman study shows Oregon PERS to be one of the
better funded systems in the nation."
Earlier this year the Pew
Center on the States issued a public pension report that listed Oregon PERS as
87 percent funded, which was the seventh best state retirement system in the
U.S. at the time. The new Milliman rankings essentially confirm the Pew
results: Oregon PERS is again at 87 percent funded in the Milliman rankings,
tied with Florida for eighth place among general state pension funds.
Ahead of Oregon PERS in the
Milliman rankings: Wisconsin (100 percent funded), Washington (97 percent),
North Carolina (95 percent), Delaware and New York (both 94 percent), Tennessee
(92 percent) and Idaho (90 percent).
The Milliman study also
includes other large public pension funds. For example, the Sacramento County
(Calif.) pension fund is tied with Oregon and Florida at 87 percent funded.
Texas counties have their own unique fund (89 percent), as do New York teachers
(100 percent). The best-funded public pension plan in the U.S. is the police
and firefighters fund in Washington state (126 percent). The worst among the
top 100 studied were the Puerto Rico government employees (a scary 7 percent)
and the Puerto Rico teachers (21 percent). Of actual states, the worst two are
Illinois and Kentucky, both at 36 percent.
The full study methodology and other details
are available on the Milliman website. A PDF version of the study results is attached to this article.