As of 2016, over 50% of Baton Rouge’s revenues were obligated to pay for pensions, but the city-parish only paid roughly half of what was due, The Wall Street Journal reports.
The same pressures Baton Rouge faces are plaguing public retirement systems around the country, as the amount owed to retirees accelerates faster than assets on hand to pay those future obligations.
Liabilities of major U.S. public pensions are up 64% since 2007 while assets are up 30%, according to the most recent data from Boston College’s Center for Retirement Research.
Illinois, New Jersey and Kentucky top the list of states in worst shape on a percentage of revenue basis.
Local governments first fell behind on its payments after the financial crisis of 2008. In response, states and cities reduced benefits for new employees, but deeper cuts needed to get back on track with payments often meet resistance from judges, unions and angry constituents—even in some of the most indebted states.
Chicago tops the list with more than 60% of its city revenues dedicated to pensions, while only paying some 35%. Read the full story.
