Appropriates $1 billion to Division of Pensions and Benefits for State-administrated retirement systems and pension funds.
Impact
The appropriation is critical for stabilizing the state's retirement systems, which have faced financial strain due to past underfunding. By allocating these funds, the state aims to improve its pension funding ratio and ensure that obligations to retirees are met. This legislative action is expected to alleviate some of the fiscal pressure on future budgets related to pension liabilities and help restore confidence among state employees and retirees regarding their benefits.
Summary
Senate Bill S2588 proposes an appropriation of $1 billion to the Division of Pensions and Benefits for State-administered retirement systems and pension funds. This funding aims to address the state's unfunded accrued liabilities, a significant issue stemming from years of inadequate pension contributions. With a record increase in state revenue, the bill seeks to make a good faith payment to these pension systems, enhancing their long-term viability.
Contention
While the intent of S2588 is to bolster financial security for state retirement systems, there may be contention regarding the sustainability of such appropriations. Critics might raise concerns about the potential for future budget deficits if the state's revenue does not continue to rise as projected. Additionally, there could be debates about prioritizing pension funding over other pressing budgetary needs, such as education and infrastructure, leading to discussions on the balance of financial commitments within the state budget.
Requires Treasurer and Divisions of Pensions and Benefits and Investment Directors to report on status of State-administered pension plans to Legislature by May 15 and November 15 each year.
To provide appropriations from the General Fund for the expenses of the Executive, Legislative and Judicial Departments of the Commonwealth, the public debt and the public schools for the fiscal year July 1, 2023, to June 30, 2024, and for the payment of bills incurred and remaining unpaid at the close of the fiscal year ending June 30, 2023; to provide appropriations from special funds and accounts to the Executive and Judicial Departments for the fiscal year July 1, 2023, to June 30, 2024, and for the payment of bills remaining unpaid at the close of the fiscal year ending June 30, 2023; to provide for the appropriation of Federal funds to the Executive and Judicial Departments for the fiscal year July 1, 2023, to June 30, 2024, and for the payment of bills remaining unpaid at the close of the fiscal year ending June 30, 2023; and to provide for the additional appropriation of Federal and State funds to the Executive and Legislative Departments for the fiscal year July 1, 2022, to June 30, 2023, and for the payment of bills incurred and remaining unpaid at the close of the fiscal year ending June 30, 2022.