As Georgia’s lawmakers stare down the barrel of a $1 billion budget gap, they’re also looking at a $1.3 billion payment for 2011 to the state’s two largest pension plans, AJC reporter Russell Grantham writes.
That cost — about $135 for each Georgian — lately has been taking a bigger bite of tax revenues every year, chewing up resources that the state could use for schools or roads or other projects, Grantham writes. Even so, the Teachers Retirement System and the Employees’ Retirement System were under water by at least $10 billion in 2009.
Pension managers and other officials say the plans are not in danger and, in fact, they look good compared with the fiscal train wrecks that some other state pension systems have become, Grantham reports.
Still, Georgia’s plans are under strong pressure from two directions, Grantham writes. First, they lost $11 billion during the stock market crash of 2008 and 2009 — a beating from which they haven’t fully recovered. Second, the ratio of active workers paying in to retirees taking out has declined sharply, Grantham reports.
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- Henry Unger, The Biz Beat
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