Grassroot Institute to release report on how to fix pension crisis
The independent, nonprofit think tank will debut its findings July 31 at a presentation on Maui
HONOLULU, July 26, 2018 >> The Grassroot Institute of Hawaii will release a new report on Tuesday, July 31, about how to bring under control the unfunded liabilities of Hawaii’s public pension system, conservatively estimated at almost $13 billion.
The report, “How to resolve Hawaii’s public pension crisis,” will be presented during a luncheon at the Maui Country Club in Paia and made available as well through the Grassroot Institute’s website, at grassrootinstitute.org.
Keli‘i Akina, president of the Grassroot Institute, said the unfunded liabilities of the Hawaii Employees’ Retirement System (ERS) could jeopardize the retirement benefits of Hawaii’s public employees and impose a significant burden on Hawaii taxpayers.
“Our public pension fund is only 54 percent funded, which means that it’s half empty,” Akina said. “If the state were to renege on its pension promises, it wouldn’t go down well with the many government employees who suddenly would have their retirement benefits eliminated or reduced.”
Akina said the new report “looks at many states that have fixed their pension debt problems through best practices, such as the creation of a new pension plan.”
According to the Grassroot Institute’s report, a new Hawaii public pension plan could:
>> Provide more flexibility to alter employee and employer contribution rates, depending on the recommendation of the pension plan actuary.
>> Protect against pension spiking.
>> Cap benefits at reasonable levels.
>> Eliminate overtime and vacation pay when calculating benefits for current hires for service yet to be rendered.
>> Base benefits on the amount of money contributed toward the plan.
“By creating a new pension system based on best practices from other state,” Akina said, “Hawaii’s lawmakers could take a step toward helping the ERS match its promised retirement benefits with employee contributions, helping roll back the system’s — and thereby the state’s — unfunded public pension liabilities.”
For more information or to arrange an interview with Keli‘i Akina, Ph.D., contact Josh Mason, Grassroot Institute of Hawaii communications director, at (918) 261-8444 or firstname.lastname@example.org.
UPDATE: The full report is available for download here.