Tuesday, September 20, 2011

Cursive writing becoming scarcer

I’ve started to update my iPension page. The new actuarial reports are there on the right. The basis for everything are the newest (2011) biennial actuarial reports for the:

I won’t say it means anything, but on page 14 of each there might be something missing. Just an oversight I am sure.

and just as some debate who is responsible for what.  Every Act 205 report submitted by the city of Pittsburgh since the act was passed was signed by the city's Finance Director, until now.

You will see if you dig into it there are reported large employer contributions into each of the plans. These are the values of the ‘asset’ created by the promise of future parking revenues. I am a little curious how that ‘asset’ was divided among the 3 plans. 

Because of all the machinations here and all this new accounting, it really is impossible to tell from this how much each pension system has in liquid assets.  Why does that matter?  Cash still matters if you have to send out a check.  Not really news, but look closely at the very last page of the police pension report. Basically without the pension bond of the 1990’s the fund for police would have been broke all the way back at the beginning of 2009.  Note the top number there which is literally zero.  If the pension bond had actually been a pledged revenue stream, there would potentially have been a big problem by now.

Even with the large infusion of this 'asset' the city's Minimum Municipal Obligation (MMO) is going up from $38.1 million annually to $44.9 million annually.  That is what has to be paid in addition to the parking revenue pledged into the system.  What is a bit interesting is that the MMO's for the police and nonuniformed employees stayed pretty much the same, but the MMO for the fire pension system almost doubled from $7.9 million to over $14 million annually which is driving virtually all of the aggregate increase in the city's MMO.  Am not sure what is going on there that is any different from the other two plans. Bigger personnel cuts in recent years is probably a big part of it.


Anonymous Anonymous said...

Part of the increased MMO for fire may be driven by "spiking" which is unavailable to police and municipal employees.

Wednesday, September 21, 2011 8:42:00 AM  
Blogger C. Briem said...

I doubt it... at least to any noticable degree. Nothing new about spiking so it can't all of a sudden be causing something that big. That and nothing spiking could do over last 2 years (which would only impact the actuarial impact of new retirees over that period) could cause that much increase in the MMO.

Wednesday, September 21, 2011 8:59:00 AM  
Anonymous MH said...

I wonder if it has anything to do with which union's chief was most loudly insisting on local control.

Wednesday, September 21, 2011 9:13:00 AM  
Anonymous He said...


Are you saying that it was damn near impossible for the actuaries to determine that the pensions are at least funded to the 50 percent level?

Wednesday, September 21, 2011 12:38:00 PM  
Blogger C. Briem said...

Me = Sgt Schultz

Wednesday, September 21, 2011 12:56:00 PM  

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