Public Pension Resource Guide:
Case Studies of State Pension Plans that Switched to Defined Contribution Plans

 

The “Public Pension Resource Guide” provides readers with facts and data on the important role that public pensions play in the economy—for employees and retirees, public employers, and taxpayers alike. 

A misperception persists among some that defined contribution (DC) plans “save money” when compared with traditional pensions. However, several states that switched to DC plans have experienced a much different reality over time. Indeed, a recent NIRS analysis of the economic efficiencies of defined benefit (DB) plans reconfirmed that pensions deliver the same amount of lifetime income for about half of the cost of providing the lifetime income from a typical DC plan. 

“Case Studies of State Pension Plans that Switched to Defined Contribution Plans” presents summaries of past changes in three state retirement systems that made the switch to a DC plan from a traditional DB pension. Case studies cover the following states: West Virginia, Michigan, and Alaska. Rather than save states money, these DB to DC switch exacerbated funding problems and drove up pension debt. 

 

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In light of the recent events in Ferguson, Staten Island, Cleveland, and around the country, the Obama Administration announced new steps to strengthen the relationships between local police and the communities they are supposed to protect and serve. One of the primary actions was the creation of a task force to improve community policing.

 

The President’s Executive Order directed the task force to prepare a report and present their recommendations; the interim report was provided to the President March 2.

 

 

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