State and local governments would have a single standard for disclosing pension liabilities that would be measured by fair market value, under a legislative proposal introduced Thursday by Rep. Devin Nunes, R-Calif.
The Public Employee Pension Transparency Act would require state and local governments to file annual reports to the Treasury secretary, which would be available on a searchable website.
Prominent House members including Budget Committee Chairman Paul Ryan, R-Wis., and Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., are expected to co-sponsor the legislation, along with Sen. Richard Burr, R-N.C.
Mr. Nunes said in a statement that the bill, similar to ones introduced in the last two years without final action, would offer a different way to report pension obligations that currently are “masked by accounting practices that would never be tolerated in the private sector,” and would rule out federal bailouts.
Public plan officials criticized the proposal as an additional burden just as new public pension accounting rules from the Governmental Accounting Standards Board start to take effect this year.
“PEPTA displays a fundamental lack of understanding of the strict standards already in place regarding public pension plan accounting and transparency,” said Meredith Williams, executive director of the National Council on Teacher Retirement in an e-mailed statement. Another accounting system “would needlessly create turmoil in the municipal bond markets and scare both bondholders and taxpayers, while adding costly federal reporting requirements.”
Michael Bird, senior federal affairs counsel with the National Conference of State Legislatures, questioned whether the legislation would do more than add “another layer of federal government reporting” and how it would be managed.
“The federal government is $17 trillion in debt, without a plan, and they want to help us?” Mr. Bird said.