Indiana will contribute an additional $360 million combined to five pension funds as part of a $720 million state budget surplus, Gov. Mitch Daniels announced Thursday.
The contributions will increase the funded status of four pension plans to 80% and add $206.8 million to the fifth, the closed pre-1996 Teachers' Retirement Fund.
Legislation passed last year dictated that half of the past fiscal year's surplus be used to bolster state pension plans and the other half be rebated to taxpayers, Adam Horst, Indiana's director of office management and budget, said in a telephone interview. Only the teachers' fund will get a part of the surplus in future years.
The contribution “reduces the need to make bigger (contribution) increases … it shores them up and helps the budget in the long term,” Mr. Horst said.
In addition to the teachers' fund, the pension funds that received additional contributions are the Judges' Retirement System, $90.2 million; Prosecuting Attorneys' Retirement Fund, $17.4 million; State Excise Police, Gaming Agent, Gaming Control Officer and Conservation Enforcement Officers' Retirement Plan, $14.6 million; and State Police Pension Trust, $31.7 million. The first three funds are all managed by the $25.7 billion Indiana Public Retirement System, Indianapolis.
The two largest funds managed by the public retirement system the Public Employees' Retirement Fund and the Teachers' Retirement Fund, had funding levels of 80.5% and 91.7%, respectively, as of June 30, 2011.