Greg David, reporter for Crain’s New York Business, posted the following story:
Okay, the headline is a bit alarmist, but as Gov. Andrew Cuomo pushes his plan to reduce costs for local governments by slashing their required payments to the state pension funds, it is important to understand exactly how solid the state’s pension system is.
This is a big and complicated issue and I’ll be writing about for the next couple of days, including Monday’s print and online column.
Below are the best funded state pension systems as calculated by the Pew Center on the States, the best source of comparative data.
New York’s Pension Fund Compared
% of pension liabilities funded
So, in just one year New York slipped from the No. 1, a position it had held for sometime, to No. 5.
The governor’s rationale is that the new, lower-cost pension benefits for new workers he pushed through the Legislature will cut required contributions later in the decade. So he wants to take the benefits now to deal with the fiscal crises faced by many upstate cities, towns and school districts.
True, we are still a long way from Illinois and California, which are at the bottom of the Pew ranking with less than 1% of their liability set aside. However, the governor’s plan will push New York way down this list.
Is that really a good thing?