The majority of public pension plans made several
reforms following the financial crisis. A new brief by the Center for State and
Local Government Excellence examines how, why, and to what extent state and local
governments have enacted these changes.
According to the report, 74% of state plans and 57% of
large local plans have cut benefits or raised employee contributions to curb
rising costs. States with the strongest legal protections for current workers
were more likely to limit such cuts to new hires.
New employees most commonly experienced increases in
the age and tenure required to claim benefits. They also were likely to see reductions
in the benefit multiplier, and increases in the number of years used to
calculate final average salary.
Higher employee contributions were the most common
benefit cut for current employees followed by reductions to the cost-of-living
Authors Jean-Pierre Aubry and Caroline Crawford from
the Center for Retirement Research at Boston College examined data from 2009 to
2014 for all 114 state plans and 46 local plans in the Public Plans Database, along
with an additional 86 local plans.
The full brief "State and Local
Pension Reform Since the Financial Crisis"
can be found here.