A Lesson on Teacher Pensions
As the public pension crisis unfolded, the entity that sets accounting standards for governments decided that more disclosure of unfunded pension liabilities was needed. These are huge numbers (almost $6 billion in in Iowa), and, for the most part, have
Iowa is a great place to retire. After an eight-year phase-out period, Iowa retirees now pay no state income tax on their Social Security income. Retirees also continue to receive a large exclusion of pension income that was first made
The Governmental Standards Accounting Board (GASB) is a national organization that sets generally accepted accounting principles (GAAP) for state and local governments. Among the reasons such standards are useful is for comparability (everyone’s financials can be compared) and transparency (we
With the closing of the 2015 legislative session this year has come a chorus of lamentations about money that didn’t get spent, and how important interests from school children to outdoor recreation and environmental protection will suffer as a result.
Public pension funds around the country have fallen trillions of dollars behind in the amounts that should be set aside to pay pension benefits when they come due. Such shortfalls have arisen from many years of inadequate contributions, compounded by
Early retirement incentive programs are often used in the public sector as a way to reduce staffing in lieu of lay-offs, or as a means to reduce costs by replacing expensive, long-tenured staff with lower-cost new hires. These programs can
In this year’s annual letter to Berkshire Hathaway shareholders, Omaha’s Warren Buffett referred to public pensions as a “gigantic financial tapeworm that was born when promises were made that conflicted with a willingness to fund them.” He warned that local