By J.D. Davidson / June 11, 2022
Each person in Ohio is on the hook for more than $36,000 in unfunded state pension liabilities, one of the highest numbers in the nation, according to a new report from the American Legislative Exchange Council.
Nationwide, unfunded state pension liabilities have climbed to $8.28 trillion, or nearly $25,000 for every person in the United States. ALEC released the latest edition of its report on pensions in all 50 states Thursday. The report, “Unaccountable and Unaffordable 2021,” shows just a handful of states with outsize pension liabilities accounting for a large share of overall pension debt in the U.S.
“As these pension payments continue to grow, revenue that could have gone towards tax relief or essential services like public safety and education is spent paying off these liabilities instead,” the report reads.
Ohio ranked as the state with the fifth-most unfunded liabilities at $429.53 billion. The top four included California ($1.53 trillion), Illinois ($533.72 billion), Texas ($529.70 billion) and New York ($508.70 billion). Those five account for more than $3.5 trillion in unfunded liabilities, or about 43% of all unfunded liabilities in the U.S.
The report does rank Ohio in the middle of the pack in terms of funding ratio at 31.5%, which measures the health of pension plans based on the ratio of plan assets to plan liabilities. No state has a fully funded pension plan. Wisconsin ranked the best at 53%, while New Jersey was the lowest at 18%.
The Ohio Public Employees Retirement System has been in place since 1935 and is governed by 11 nonpaid members of a board of trustees. It serves more than 1 million past and present Ohio workers, including local and municipal employees as well as state college and university employees.
The report looked at 290 state-administered government pension plans and their assets and liabilities from fiscal year 2012 to fiscal year 2020.
The states with the least unfunded pension liabilities were Vermont ($14.43 billion), South Dakota ($14.44 billion), North Dakota ($15.13 billion), Delaware ($18.46 billion) and Wyoming ($18.71 billion). On a per capita basis, the lowest were Tennessee ($8,511.92), Indiana ($10,188.66), Nebraska ($13,370.44), Florida ($14,062.16) and Idaho ($15,918.74).
An Ohio native, J.D. Davidson is a veteran journalist with more than 30 years of experience in newspapers in Ohio, Georgia, Alabama and Texas. He has served as a reporter, editor, managing editor and publisher. Davidson is regional editor for The Center Square.
Categories: State of Ohio