State Pension Plans: Liabilities, Funded Ratios

Investment research firm Morningstar, Inc., conducted a study analyzing state pension data, finding 21 states' retirement systems to not be fiscally sound.

The report employed two primary measures to assess pension funds. The funded ratios compare a system's total assets to its liabilities. The second measure, unfunded actuarial accrued liability per capita, pegs the amount each state resident would need to pay to fully fund the system.

Twenty-one states' aggregate funded ratios fell below 70 percent, which Morningstar considers the threshold for fiscally-sound funds. When measuring liability per capita, Alaska, Illinois and Hawaii recorded the highest amounts.

The table below lists figures for 2009-2011. Additional numbers are listed at the end of Morningstar's report.

The investment firm cautions that direct comparisons between state systems can be misleading. For many plans, other public entities are liable for benefits, along with state governments. Benefit types also vary from plan to plan, along with investment strategies.



State 2009 Funded 2009 Unfunded Liability/Capita 2010 Funded 2010 Unfunded Liability/Capita 2011 Funded 2011 Unfunded Liability/Capita Alabama 73.9% 2,307 70.3% 2,706 66.9% 3,059 Alaska 61.1% 8,641 59.5% 9,717 59.2% 10,235 Arizona 78.9% 1,237 76.2% 1,464 75.0% 1,592 Arkansas 77.5% 1,781 74.8% 2,092 72.5% 2,412 California 80.6% 2,557 78.2% 3,022 77.1% 3,249 Colorado 67.0% 1,349 62.8% 1,548 57.7% 1,804 Connecticut 61.6% 11,651 61.6% 11,651 53.4% 5,885 Delaware 94.5% 467 92.1% 693 90.7% 870 Florida 87.1% 951 86.6% 1,011 86.9% 1,024 Georgia 90.7% 741 87.9% 975 83.8% 1,376 Hawaii 64.6% 4,676 61.4% 5,353 59.4% 6,114 Idaho 73.6% 2,087 78.4% 1,774 89.9% 853 Illinois 50.6% 4,899 45.4% 5,943 43.4% 6,505 Indiana 63.4% 1,916 61.8% 2,103 59.6% 2,284 Iowa 80.9% 1,686 81.0% 1,701 79.5% 1,959 Kansas 63.7% 2,729 62.2% 2,942 59.2% 3,285 Kentucky 58.2% 3,481 54.3% 3,944 50.5% 4,488 Louisiana 69.9% 2,175 55.6% 3,921 56.0% 3,975 Maine 67.9% 3,008 66.2% 3,243 77.6% 1,913 Maryland 65.0% 3,238 64.1% 3,405 64.7% 3,465 Massachusetts 63.8% 3,141 68.7% 2,828 72.6% 2,589 Michigan 83.6% 1,157 78.9% 1,549 71.5% 2,228 Minnesota 79.6% 2,463 80.8% 2,238 79.3% 2,448 Mississippi 67.4% 3,434 64.2% 3,872 62.3% 4,242 Missouri 78.0% 1,821 75.5% 2,095 80.8% 1,564 Montana 74.3% 2,717 70.0% 3,405 66.3% 3,965 Nebraska 87.5% 643 83.6% 888 81.5% 1,059 Nevada 72.4% 3,468 70.5% 3,944 70.1% 4,192 New Hampshire 58.5% 2,696 58.6% 2,843 57.5% 3,252 New Jersey 66.6% 5,104 69.2% 4,448 67.5% 4,786 New Mexico 76.2% 3,432 72.4% 4,136 67.0% 5,310 New York 101.5% -111 94.3% 461 90.5% 814 North Carolina 99.2% 46 95.9% 264 95.3% 311 North Dakota 85.8% 437 74.5% 903 71.7% 1,061 Ohio 75.2% 1,603 75.2% 1,672 78.9% 1,496 Oklahoma 57.7% 3,653 56.1% 3,968 67.0% 2,603 Oregon 80.2% 2,855 85.8% 2,148 86.9% 2,059 Pennsylvania 80.8% 1,691 75.1% 2,334 67.8% 3,264 Rhode Island 58.7% 4,495 61.3% 3,892 58.6% 4,230 South Carolina 70.1% 2,672 68.6% 2,923 66.5% 3,265 South Dakota 91.7% 776 96.1% 365 96.3% 362 Tennessee 90.6% 436 92.1% 415 Texas 84.1% 1,016 83.3% 1,126 82.9% 1,188 Utah 85.8% 1,301 82.7% 1,660 78.3% 2,198 Vermont 71.1% 1,689 72.7% 1,611 70.4% 1,909 Virginia 83.5% 1,369 79.7% 1,787 72.0% 2,707 Washington 89.6% 907 92.5% 657 98.1% 160 West Virginia 63.6% 2,699 55.9% 3,417 57.9% 3,427 Wisconsin 99.7% 45 99.8% 34 99.8% 23 Wyoming 88.8% 1,522 85.9% 1,999 83.0% 2,486







Funded Ratio Map

The following map shows funded ratios Morningstar compiled, with green states reporting the highest ratios. Click a state to display 2011 figures: