ALBUQUERQUE, N.M. — New Mexico’s pension funds aren’t on quite as solid financial ground as was hoped four years when lawmakers approved fixes intended to shore up two large retirements systems.
The Public Employees Retirement Association and the Educational Retirement Board will not be 100 percent funded by 2043, falling short of goals previously set by officials, leading them to lower their expectations for annual investment gains , the Albuquerque Journal reported (http://bit.ly/2ybdth0).
Officials predict the Educational Retirement Board, which covers over 105,000 active school employees and retirees, will not reach 100 percent funding until 84 years from now.
Some state lawmakers are considering reducing or revising annual cost-of-living increases for retired members of the association similar to actions taken in 2013.
“Something has to be done,” said Democratic Sen. George Munoz of Gallup, the vice chairman of the Legislature’s interim Investments and Pension Oversight Committee. “The pension funds have too many benefits.”
The Public Employees Retirement Association’s estimated unfunded liability — the difference between future retirement benefits and the expected future assets available — has gone from $4.6 billion to $4.8 billion in the past four years. It covers 52,000 workers and 40,000 retirees composed of state workers, law enforcement officers and public-sector employees.
The situation is not as bad as it was during 2013, said Wayne Propst, the Public Employees Retirement Association’s executive director. That year, Gov. Susana Martinez moved to cut the annual cost-of-living adjustment for all members of the association and imposed stricter eligibility guidelines for future hires.
“We were headed toward insolvency before 2013, and now we’re not,” Propst said. “Our headwinds are manageable if we’re smart — I feel we are still on the right track.”
Lawmakers may not able to propose legislative change until 2019, when a new governor steps in.
Information from: Albuquerque Journal, http://www.abqjournal.com