Press Release

States Remain at Risk Due to Unfunded Pension Liabilities

Unfunded pension liabilities exceed $5.8 trillion across the 50 states

FOR IMMEDIATE RELEASE
Contact:
Alexis Jarrett
[email protected]

States Remain at Risk Due to Unfunded Pension Liabilities

Unfunded pension liabilities exceed $5.8 trillion across the 50 states

ARLINGTON, VA – (JUNE 24, 2021) Today, the American Legislative Exchange Council (ALEC) releases Unaccountable and Unaffordable, 2020. This annual publication from the ALEC Center for State Fiscal Reform collects and analyzes each state’s unfunded public pension liabilities. The report finds state governments’ unfunded liabilities total $5.82 trillion nationwide – an average of $17,748 per person.

This comparative analysis of state pension systems is a valuable tool for state legislators as they strive to keep promises made to retired public employees while also protecting taxpayers through responsible pension reforms.

“Unfunded pension liabilities are a looming threat to states’ financial health,” said ALEC CEO Lisa B. Nelson. “This report tackles the issue head on and provides examples of reforms that work, such as defined contribution plans.”

This publication uses unfunded pension liabilities per capita to illustrate the magnitude of the liabilities:

Top 5 States Ranked (per capita)

1. Tennessee: $6,346

2. Indiana: $7,859

3. Nebraska: $9,874

4.Florida: $10,113

5. Wisconsin: $10,169

Worst 5 States Ranked (per capita)

46. New Jersey: $28,643

47. Hawaii: $31,078

48. Connecticut: $31,192

49. Illinois: $31,980

50. Alaska: $42,818

Follow this link to read the full report.

“In Tennessee, we have worked hard to maintain one of the nation’s best funded pension systems,” said Tennessee State Representative Susan Lynn. “Our efforts on behalf of taxpayers will continue, and we are proud to be recognized in the latest edition of ALEC’s report for our commitment to sound pension policies.

“Unfunded public pension liabilities represent a massive risk for state taxpayers, as well as state workers and retirees,” says ALEC Chief Economist and Executive Vice President of Policy Jonathan Williams. “Fortunately, states like Wisconsin, Michigan, Tennessee and Oklahoma have all enacted pension reforms in recent years that will ensure promises to workers and retirees are honored, provide flexibility for young workers and protect hardworking taxpayers.”

The ALEC Center for State Fiscal Reform strives to educate decision makers and the general public on the principles of sound fiscal policy and the evidence that supports those principles. This is done by personalized research, policy briefings in the states and by releasing nonpartisan policy publications for distribution.

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The American Legislative Exchange Council is the largest nonpartisan, voluntary membership organization of state legislators in the United States. The Council is governed by state legislators who comprise the Board of Directors and is advised by the Private Enterprise Advisory Council, a group of private, foundation and think tank members. For more information about the American Legislative Exchange Council, please visit: www.alec.org.


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    Unaccountable and Unaffordable, 2020

    Our latest edition of this report finds that unfunded state pension liabilities total $5.82 trillion or $17,748 for every man, woman and child in the United States. State governments are …