by Deborah D. Thornton
Public Interest Institute
February 26, 2014
The Fiscal Year 2013 Iowa Public Employee Retirement System (IPERS) annual report was greeted with good cheer by many in the Legislature and state government. In general, a pension plan is considered to be adequately funded if 80 percent of the money owed is available. Current IPERS funded ratio is 81 percent, up from 79.5 percent in 2012. This is still well down from its 97.9 percent high in 2000, before the financial crisis and large increase in retirees, but it has stabilized in the “approved” 80 percent range. However, the IPERS unfunded actuarial liability (UAL) is still almost $6 billion, or a full year of the state budget. The question is, “Is this good enough?” Because the amounts owed to both current and future beneficiaries must be paid by future taxpayers—the younger workers of today and tomorrow—the answer is “No.”

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