Census Bureau Reports on Status of Public Pensions

There is great variation among the states regarding their ability to meet their obligations to current and future retirees from their state and local work forces. The U.S. Census Bureau in its recently released 2013 Survey of Public Pensions: State-Administered Defined Benefit Data highlights those differences in stark relief in the information it provides on revenues, expenditures, financial assets, membership and liabilities of 227 state-administered DB systems.

The survey provides a table and files that provide comprehensive statistical information about the financial activity and the membership of state and local government employee pension systems.

Population of Interest

The population of interest for this survey includes public employee pension systems administered by state governments throughout the nation. According to the Census Bureau, pension systems were only included if they met two criteria: 

• they were sponsored by a recognized unit of government as defined by the Census Bureau; and 
• their membership was comprised of public employees compensated with public funds. 

These pension systems consist of defined benefit plans — not defined contribution or post-employment health care plans.

The 2013 survey year encompasses fiscal years that end between July 1, 2012 and June 30, 2013. The Census Bureau notes that most state-administered pension systems have fiscal years that end on June 30 and for those systems, the 2013 survey year covers the period July 1, 2012-June 30, 2013. For pension systems with fiscal years that end after June 30, the survey year includes data from their 2012 fiscal year.

50 States, 50 Situations 

The report also provides additional detailed information on each state’s public pension plan contributions, investments, securities and obligations. 

California, for example, with more people than Canada and an economy bigger than that of many countries, also boasts the largest covered payroll of any state — more than $77 billion, 13% of all covered payroll in the United States. Its pension obligations amount to a whopping $613 billion. Not as high, but still above $100 billion, are the pension obligations of New York, Texas, Ohio, Illinois, Florida, Pennsylvania and New Jersey (in that order). 

These states are all among the most populous, but sheer population is not the only factor behind pension obligations; the pension plan each state runs, its rates and coverage, also affect the obligations. For instance, Alabama, Colorado and South Carolina, with much smaller populations, each have obligations of over $40 billion. Even Utah, which ranks 33rd in population, has pension obligations of $27 billion. 

None of these states has a public pension system with cash and investment holdings that even equal their obligations, but the disparity varies. For instance, California and Illinois have obligations that are at least $100 billion above their cash and investments, but the gap for New York, which has the second highest pension obligations, is only $7 billion.