State Guidance: Locals Must Report Share of State Unfunded Pension Liability

A widely anticipated letter from the Maryland State Retirement and Pension Systems spelled out procedures for reporting unfunded liabilities among the local governments who participate in the state pension system — and requires them to report a share of the whole state system’s unfunded liability, not just that of the local participants. The administrative decision […]

Editorial Critiques State Pension Funding Flip

An editorial in the Washington Post critiques the Maryland Legislature’s new approach to funding the state pension system, which has a larger than $17 billion unfunded liability. The Editorial states, FOUR YEARS ago, lawmakers in Annapolis struck a deal to undergird Maryland’s perilously indebted pension fund. The deal rested on a pair of sacrifices: State employees would contribute 7 […]

State Pension Board Adopts New Actuarial Assumptions, Could Lower Teacher Pension Normal Costs

At the meeting of the State Pension Board yesterday, the Board adopted new actuarial assumptions that could lower the normal costs of the teacher pension plan and considered a new method of funding the administrative costs of the system. Gabriel, Roeder Smith & Company, the State’s actuary, presented the results of the Maryland State Retirement […]

Editorial Lauds Governor’s Decision to Fund Pensions

An editorial in the Washington Post describes the merits of Governor Hogan’s decision to withhold $68 million in education funding with a pledge to provide that funding to the State’s pension system instead. The piece defends the decision, stating that there are long-term negative budgetary consequences of altering the legislature’s pension funding plan. The legislature may push […]

Governor to Fund Pension System, Not Education With Set Aside Funds

Governor Larry Hogan announced yesterday that he would not allocate the $68 million that the General Assembly set aside for education in the fiscal 2016 budget to fully fund the Geographic Cost of Education Index (GCEI). Instead, he stated that he would put the money in the State pension system to address its unfunded liability. From the Governor’s […]

MACo, MML Pursue Pension Liability Reporting Process

Recently adopted accounting standards required pension systems to allocate their unfunded liabilities for reporting on financial documents. For a pooled system like the state’s (which includes many local government employees who opt in), the system is obliged to apportion liabilities across pool participants. The Maryland State Retirement Agency recently shared a “dry run” of this […]

Presentation Explains Pension Funding Plan Passed by the House

A recent presentation by the Department of Legislative Services provides further explanation of the pension funding proposal adopted by the Maryland House of Delegates last night. As described in the presentation, Under the House proposal, the pension fund is projected to reach the 80% funding level by fiscal 2023, the original goal established by the […]

Post Editorial Critiques State Pension Move

The Maryland legislature is currently considering a proposal from the Department of Legislative Services that would alter the way the State funds its employee pension system while freeing up additional funds for the current budget year.  A recent editorial from the Washington Post critiques the proposal and asserts potential long-term negative effects on the pension system. From […]

Maryland Legislature Considers New Pension Funding Proposal

The General Assembly is weighing a proposal to change funding for the State Pension System that could provide additional funding for other parts of the budget over the next few years. The proposal would end the plan to reinvest savings from recent benefit reductions, but would accommodate a repeal of Maryland’s highly criticized corridor funding method in […]

Recommendation Repeals State Pension’s Corridor Funding Method and Supplemental Contribution

In a new analysis, the Department of Legislative Services is recommending a provision be added to HB 72, the Budget Reconciliation and Financing Act of 2015 to repeal the corridor funding method and the required supplemental contribution adopted a few years ago to assist with achieving full actuarial funding of the State Retirement and Pension System (SRPS). The […]