Reforms Needed for North Carolina's Ailing Pension System | Eastern North Carolina Now

    [1] "Pension Benefits Discussion," a Fiscal Research presentation for the House Select Committee on Legacy Costs from the State Health Plan, Pensions and Employment Security Commission; Dec. 13, 2011. Available online at: http://www.nccivitas.org/wp-content/uploads/2012/06/pensions.pdf

    [2] Teachers' and State Employees' Retirement System Handbook, North Carolina Department of State Treasurer. Jan. 2012. Available online at: http://www.nctreasurer.com/ret/Benefits%20Handbooks/NCTeaState.pdf

    [3] The 8.33% rate from Session Law 2012-142 (FY 2012-13 State Budget), Section 25.10. Available online at: http://www.ncleg.net/Sessions/2011/Bills/House/PDF/H950v7.pdf Salary base used for calculation is $9.7 B for General Fund supported positions obtained in email correspondence with State Treasurer's Office and Fiscal Research Division.

    [4] TSERS Handbook, Ibid.

    [5] "Get the Facts: The North Carolina Pension System," Assembled by the North Carolina Department of State Treasurer. Available online at: https://www.nctreasurer.com/ret/Active%20Employees/PensionFactSheet.pdf

    [6] "Report on the Sixty-Eighth Annual Valuation of the Teachers' and State Employees' Retirement System of North Carolina Prepared as of December 31, 2010," Buck Consultants. Available online at: https://www.nctreasurer.com/ret/Retirement%20Reports/Valuation-Report-TSERS-2010.pdf

    [7] "Teachers' and State Employees' Retirement System of North Carolina, Projection of Funded Ratios and Required State Contribution Rates." Obtained via email correspondence with state treasurer's office in Jan. of 2012. Available online at: http://www.nccivitas.org/wp-content/uploads/2012/07/tsers-est.pdf

    [8] "State of North Carolina 2009 Compensation & Benefits Report," North Carolina Office of State Personnel, Dec. 2008. Available online at: http://www.osp.state.nc.us/CompWebSite/2009%20Comp%20&%20Benefits%20Report.pdf

    [9] Buck Consultants, Ibid. Schedule D, Table 1.

    [10] Data prepared for the North Carolina Future of Retirement Study Commission by the state treasurer's office. Available online at: https://www.nctreasurer.com/ret/Future%20of%20Retirement/RetirementAgesHistoryExhibits.pdf

    [11] "Get the Facts," Ibid.

    [12] McDonnell, Ken. "Retirement Annuity and Employment-Based Pension Income,

    Among Individuals Age 50 and Over: 2008"

    Employee Benefits Research Institute, Notes; Vol. 31, No. 5. May 2010. Available online at: http://www.ebri.org/pdf/notespdf/EBRI_Notes_05-May10.IAs.pdf

    [13] "Pension Benefits Discussion," Ibid.

    [14] Martin, Patricia. "Comparing Replacement Rates Under Private and Federal Retirement Systems," U.S. Social Security Administration Office of Policy. Social Security Bulletin, Vol. 65 No. 1, 2003.2004. Available online at: http://www.ssa.gov/policy/docs/ssb/v65n1/v65n1p17.html#mt4

    [15] Ibid.

    [16] Ibid.

    [17] Bureau of Labor Statistics, U.S. Department of Labor. "National Compensation Survey: Employee Benefits in Private Industry in the United States, 2005." Table 50. May 2007. Available online at: http://www.bls.gov/ncs/ebs/sp/ebbl0022.pdf

    [18] The Pew Center on the States, "The Widening Gap Update", Issue Brief, June 2012. Available online at: http://www.pewstates.org/uploadedFiles/PCS_Assets/2012/Pew_Pensions_Update.pdf

    [19] Williams, Bob. "Pew Study Fails to Give Accurate Portrayal of Pension Crisis," Washington Examiner. June 26, 2012. Available online at: http://washingtonexaminer.com/pew-study-fails-to-give-accurate-portrayal-of-pension-crisis/article/2500667

    [20] Snell, Robert K. "Pensions and Retirement Plan Enactments in 2011 State Legislatures," National Conference of State Legislatures 2011 State Retirement Legislation Report. Jan. 31, 2012. Available online at: http://www.ncsl.org/documents/employ/2011EnactmentsFinalReport.pdf

    [21] Buck Consultants, Ibid.

    [22] "Get the Facts," Ibid.

    [23] Bureau of Labor Statistics, U.S. Department of Labor. "National Compensation Survey: Employee Benefits in the United States, March 2010." Private industry tables, Table 2. Sept. 2010. Available online at: http://www.bls.gov/ncs/ebs/benefits/2010/ebbl0046.pdf

    [24] National Compensation Survey 2010, Ibid. Table 28. Available online at: http://www.bls.gov/ncs/ebs/detailedprovisions/2010/ownership/private/table28a.txt

    NOTE: The treasurer office's "Get the Facts" sheet claims "According to federal statistics, the average large employer contributes over seven percent of pay to their employees' retirement benefits." This is misleading. The statistic they are referencing can be found in the Bureau of Labor Statistics' March 2012 Employer Costs for Employee Compensation report, found online here: http://www.bls.gov/news.release/pdf/ecec.pdf Table 8 indicates an average employer cost of 7.5% of wages for total retirement and savings contributions, not just the cost of employer contributions to defined contribution - 401(k) - plans. The data used in this article specifically looks at employer contribution for defined contribution plans to ensure an accurate comparison.

    [25] Office of State Personnel, Ibid.

    [26] "Final Report to Boards of Trustees of the Teachers' and State Employees' Retirement System and the Local Governmental Employees' Retirement System," North Carolina Future of Retirement Study Commission. Nov. 16, 2010. Available online at: https://www.nctreasurer.com/ret/Future%20of%20Retirement/FORSCreport.pdf

    [27] "Projection of Funded Ratios and State Contribution Rates," Ibid.

    [28] North Carolina Department of State Treasurer, Annual Report for FY 2010-11, pg. 33. Available online at: https://www.nctreasurer.com/inside-the-department/Reports/AnnualReport-FY11.pdf

    [29] Dreyfuss, Richard C. "Estimated Savings From Michigan's 1997 State Employees Pension Plan Reform." Mackinac Center for Public Policy, Policy Brief, June 23. 2011. Available online at: http://www.mackinac.org/15284

    [30] Office of State Personnel, Ibid.

    [31] Ibid.

    [32] Snell, Ronald K. "Changes in Age and Service Requirements for Normal Retirement in State Retirement Plans, 2009-2011." National Conference of State Legislatures, March 2012. Available online at: http://www.ncsl.org/documents/employ/ReportAgeServiceChangesFINAL.pdf

    [33] Wisconsin Legislative Council,

    "2008 COMPARATIVE STUDY OF MAJOR PUBLIC EMPLOYEE RETIREMENT SYSTEMS." Chart II. Dec. 2009 (Revised May 2010). Available online at: http://legis.wisconsin.gov/lc/publications/crs/2008_retirement.pdf

    [34] National Association of State Retirement Administrators, "Selected Approved Changes to State Public Pensions to Restore or Preserve Plan Sustainability." May 2012. Available online at: http://www.nasra.org/resources/SustainabilityChanges.pdf

    [35] National Compensation Survey, 2005; Table 47. Ibid.

    [36] North Carolina Future of Retirement Study Commission, "Recent Changes that Could Reduce Compensation Spiking". Available online at: https://www.nctreasurer.com/ret/Future%20of%20Retirement/FactSheetAntiSpiking.pdf