Auditor general’s report validates serious pension woes
Maybe the state’s Auditor General Eugene DePasquale can do what no one else has been able to do regarding public pension funds – that is, reform them before they bankrupt government.
DePasquale issued a recent report bringing into focus just how bad the municipal pension funding system is in the state.
He warned that rising pension costs for local government workers could push municipalities into bankruptcy and spur tax increases if policymakers do not make changes.
The state’s 1,200 municipal pension systems are underfunded by billions of dollars and DePasquale warned that the commitments could be at risk if municipalities follow the path of Detroit.
DePasquale called for the municipal pension systems to convert to a 401(k)-style retirement plan and make other changes to try to lower pension obligations to future employees. The changes he recommended include barring high amounts of an employee’s overtime pay from influencing pension obligations and adjusting age and service requirements for retirement eligibility to account for increased life expectancy.
He called for the state to increase pension aid to municipal systems meeting certain requirements. He called on the governor and state Legislature to act now on legislation that can make many of the suggestions happen.
This has all been said before.
Our modest hope would be that when the words come from the numbers guru the auditor general they might matter.
We won’t hold our breath. But we’d love to be surprised.