Alaska Attempts to Shore up Pensions

The Alaska Retirement Board has approved a plan by Governor Sean Parnell to shift $3 billion is savings over to the state’s struggling pension funds. Unfunded liabilities in the Public Employee Retirement Fund and the Teacher Retirement System now exceed $12 billion, and the state recognizes that something must be done to avoid default.

Parnell’s proposal is popular because it helps the state balance its budget, and includes unfunded liability payment caps in the future that will reduce the danger of defaults and make budgets easier to balance for years to come. Parnell has been applauded for acting sooner rather than later so that the money deposited in the trust fund can have a chance to grow with time.

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