More bad news for New Jersey surfaced last week as part of the disclosure paperwork released by the state as it prepares for a $535 million dollar general obligation bond issue. In the filings with the SEC it was reveled that the state's pension plans, now subject to new GASB accounting standards, are in much worse shape than previously thought. According to Reuters the funding level is nearly 20 percentage points lower than previously estimated. It is reported at just 44% funding for fiscal 2014.
This new level is even in dispute as an article from John Bury, a state pension expert that created the BuryPensions Blog, claims the funding level is just 32.6 percent of what is promised to government employees.
New Jersey is considered to be among the worst prepared and among the least well funded public pension systems of all states.
It does not take a crystal ball to know that when the stock market experiences a sharp decline or, as many financial pundits expect, the mega crash hits, this low level of funding will likely be catastrophic.
In advance of the pending calamity I think it is reasonable to ask how much this pension system and it's inequities to the private sector is behind the dismal economy and dire loss of opportunity that the people of New Jersey face?
America's Poster Child of Decline; Bankrupted Morals and Bankrupted Finances
RESOURCES
Pension & Investments
http://www.pionline.com/article/20141126/ONLINE/141129877/new-gasb-rules-result-in-new-jerseys-funded-status-plummeting-to-44
Reuters
http://www.reuters.com/article/2014/11/26/usa-new-jersey-pensions-idUSL2N0TF23620141126
BuryPensions Blog
https://burypensions.wordpress.com/2014/11/26/32-6-funded-ratio/
No comments:
Post a Comment