Thank you for your readership and support of SBS throughout this past year, be it reading our website, sharing an article with others who are interested in state finance or following us on Facebook. We are grateful for you.
SBS has had a wonderful year in 2013 and we are very excited for 2014. We have big plans for the new year and will hit the ground running with the January release of our 4th annual state debt study with crucial information for citizens and lawmakers in all 50 states. You won't want to miss it.
Please consider a year-end tax deductible contribution supporting State Budget Solutions' vital reform work in the states!
From the entire SBS team we wish you all a Merry Christmas and Happy Holidays. This month's newsletter features some highlights from this year, enjoy!
Comprehensive research into the funded status of state level defined benefit public pension plans reveals that public employee retirement promises are underfunded by $4.1 trillion. Combined, state public pension plans are just 39 percent funded.
Figures were drawn from state Fiscal Year 2012 Comprehensive Annual Financial Reports, as well as the Comprehensive Annual Financial Reports and actuarial valuations published by individual plans. In each case, figures were from the most up-to-date valuation available at the time of research. Plans were compiled based on the United States Census Bureau's Annual Survey of Public Pensions and state-level financial reports. Therefore this includes municipal pension funds that are administered by the state.
The debate over Medicaid expansion is as much about federalism and the issue of state control as it is about money-because these are ultimately one in the same.
The Affordable Care Act (ACA) includes Medicaid expansion, which widens the range of eligible individuals who can receive government insurance. The federal government has promised to provide 100 percent of the funding for the new enrollees, consisting of the childless adults whose income is 138 percent of the federal poverty line, for the first three years. Over time, the states will gradually pick up 10 percent of the total costs. Several states have jumped at the opportunity to get "free money" to provide more government services.
The implementation of the Common Core State Standards Initiative is forcing states to determine when a "good offer" becomes an offer that cannot be refused. That is to say that federal incentives offered to states for adoption of the Common Core State Standards (CCSS) have become very attractive--so attractive that "voluntary" participation in the program may be merely a nominal check on the centralization of American education.
The CCSS are a list of specific and universal educational benchmarks in English language arts and mathematics that will replace the individual state K-12 education goals and requirements of each state that adopts them. This report will explain the issues surrounding the adoption of the CCSS and address the "voluntariness" question, the incentives and disincentives for states, and how the CCSS may affect the balance of federalism between states and the federal government. These issues are at the forefront as states grapple with whether to implement the CCSS and as some states, including Michigan and Indiana, reconsider their endorsement of the CCSS.
State Budget Solutions is a known expert in fiscal responsibility and pension reform. Every month, countless media outlets and financial professionals cite the work of SBS's expert analysis and publish the opinions of SBS leaders. Here are a few highlights from 2013:
California on the Brink: Pension Crisis About to Get Worse Fox News It's all largely due to soaring employee retirement costs, according to new analysis based on the methodology by Bob Williams and his team at State Budget Solution (SBS), a non-partisan organization that studies state budget crises. READ AND WATCH MORE
Detroit Emergency Manager Meeting with Creditors USA Today Detroit's debt-to-asset ratio may be as high as a stunning 33-1. Meaning, for every $1 in assets the city has, it holds $33 in debt. By comparison, that ratio was 20-1 for General Motors when it and Chrysler went into bankruptcy in 2009, according to State Budget Solutions, a nonpartisan nonprofit group that advocates for reform in government budgeting and pensions. READ MORE
Study: State Pension Shortfalls Reach $4.1 Trillion Daily Caller America’s state-level public employee pensions are underfunded by $4.1 trillion, according to a study released Tuesday by the organization State Budget Solutions. READ MORE
The Williams Report
As a former state legislator, gubernatorial candidate and auditor with the Government Accountability Office, State Budget Solutions' President Bob Williams is a national expert in fiscal and tax policies. Each week, he compiles the latest news and headlines pertaining to state budgets, collective bargaining and state public pensions into The Williams Report.
CONNECTICUT: State looking at deficits of more than $1.1 billion for three straight years starting in the 2016 fiscal year. Hartford Courant
Pensions for teachers fall farther behind. CalPERS added more than $4 billion to the unfunded pension liability in 2012 because they chose to underfund its so-called "catch up" payment. The Heartland Institute