Contact: Gina Diorio, 862-703-6670, [email protected]
Exposed: State Agency Pension Debt Revealed for First Time
$18 Billion SERS Unfunded Liability Breakdown Shows Urgent Need for Reform
September 7, 2016, HARRISBURG, Pa.—As lawmakers mull major changes to Pennsylvania’s public pension system this Fall, the Commonwealth Foundation today revealed new state pension details, showing specific unfunded liabilities for state and local agencies, the General Assembly, the judiciary, state-funded colleges, and other state employers.
Click here for an interactive, embeddable chart detailing unfunded liabilities for the more than 100 state employers in the State Employees’ Retirement System (SERS). These figures, totaling more than $18 billion as of December 31, 2015, were obtained from SERS via Right to Know request.
"We routinely see pension debt lumped in huge, hard to grasp numbers," commented Elizabeth Stelle, director of policy for the Commonwealth Foundation. "Seeing these costs broken down for the first time should alert taxpayers to where their money is going and give lawmakers a better understanding of the main cost drivers in our failing pension system.
"Pennsylvanians may be surprised to learn that Penn State University is nearly $1 billion in pension debt, that they are on the hook for the state House and Senate’s combined $385 million in unfunded liabilities, and that the Liquor Control Board—a Prohibition-era relic—accounts for $475 million in debt. From community colleges to legislative committees to the Milk Marketing Board, the amount of state employee pension debt is staggering.
"Government-owned businesses like the Liquor Control Board, Turnpike Commission, and Higher Education Assistance Agency, now have to disclose hundreds of millions of dollars in pension debt. These liabilities raise the cost of purchasing wine or spirits, driving across the state, or taking out a college loan."
Top 10 State Agencies by Pension Debt
Agency Unfunded Liability
Corrections Dept. $3,319,687,326
Dept. of Human Services $2,387,009,484
Pa. State Police $1,931,713,997
Transportation Dept. $1,788,139,855
State System of Higher Education $858,417,236
Labor and Industry Dept. $719,579,421
Liquor Control Board $475,046,271
Dept. of Environmental Protection $442,675,014
Pa. Higher Education Assistance Agency $440,673,163
Pa. Turnpike Commission $346,946,156
"State workers deserve a stable retirement, but many may not see one unless the current pension system—vulnerable to deliberate underfunding—is reformed. It’s time to transition new state employees to 401(k)-style plans that are portable from job to job and cannot be underfunded for political gain. Lawmakers must act now to avoid relegating more workers to a broken system that is failing both state employees and taxpayers."
Elizabeth Stelle and other Commonwealth Foundation experts are available for comment. Please contact Gina Diorio at 862-703-6670 or [email protected] to schedule an interview.
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