Public pension officials and policymakers have almost too many options for figuring out their funding demands these days. First are the new accounting standards from the Governmental Accounting Standards Board that start going into effect this year, with a new “net pension liability” figure.
In June, Moody's Investors Service came out with a new measure of public pension liabilities, based on market value of pension plan assets and liabilities. And, according to best practices just released by the Government Finance Officers Association, Washington, the actuarial valuation reports are the ones to follow.
To help state and local governments sort through it all, a Pension Funding Task Force of national organizations representing governors, state legislatures, state and local officials and public finance professionals has just released “Pension Funding: a Guide for Elected Officials.”
The guide lays out three distinct buckets for pension numbers, depending on whether they are used for “books” — annual financial statements, “bonds” — how pension fund liabilities affect creditworthiness, or “budgets” — figuring out annual pension contributions for sound funding.
The guide is available at www.wikipension.com/images/ 5/51/BBBonepager.pdf.