Merced County pensions may have the lowest funding level of any public pension system in California, a shortfall officials attribute to a big retroactive pension increase for all county employees a decade ago and faulty actuarial work.
Like most pension systems, the funding level of the giant California Public Employees Retirement System has gone up since a stock market crash in 2008 punched a big hole in investment funds, increasing from about 60 percent to 76 percent.
But the funding level of the Merced County Employees Retirement Association has continued to drop since the crash, decreasing from 70.5 percent in 2008 to 51.4 percent last year, despite nearly doubling employer payments into the pension fund.
In the latest annual public pension report from the state controller’s office, Merced County stands out with the lowest level of funding in the last reported year, 54.7 percent in 2010-11. ...
The 4,600-member system owes $1 billion for pensions promised in future decades, up from $692 million in 2008. The projected assets from employer-employee contributions and investment earnings only increased from $488 million to $547 million.
Merced County pension fund investments earned an annual average of 6.6 percent during the last 10 years, less than the 7.75 percent currently expected. ...
Read full story here. Hat tip to BenefitsLink.
