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February 1, 2017

Natalie Cohen, Senior Analyst
Municipal Securities Research natalie.cohen@wellsfargo.com
(212) 214-8014

PENSIONS IN CYBERSPACE
(Everything you have ever wanted to know about state and local
PUBLIC PENSIONS on the Internet)

A curated, annotated bibliography, hot-linked to resources

This is a selective inventory of articles touching on many areas of public pensions and retiree health
care. It is not comprehensive (we invite our readers to suggest favorite sites we may have missed.) For
example, this is not an analysis of which pensions are well-funded and which are not. It is also not set
up for you to find individual plan audits, but these can typically be found on the internet with a few
key words (name of plan and “audit” or “financial statement” for example). In many cases, plan
statements are housed at the state level. We hope this directory will be thought-provoking and help
you evaluate pensions and benefits.

Please see the disclosure appendix of this publication for certification
and disclosure information. Also note that all estimates and forecasts
are current as of 2/1/17 unless otherwise stated.
2/1/17 at 1:00 p.m. ET

Reports available on Bloomberg at WFRE and wellsfargoresearch.com
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February 1, 2017 MUNICIPAL SECURITIES RESEARCH

TABLE OF CONTENTS
(“click” in TOC will take you to the page in this document; a single click on websites will take you to the respective
webpages). The focus of this directory is to list sites that are free (unless otherwise indicated).

BASICS 3

TOPICS 3

Cost-Share Plans 3

Crowding-Out 4

Disclosure 4

Federal Oversight 4

Funding 4

GASB Accounting Changes 4

Governance 4

Investing Pension Assets 5

Legal Underpinnings of the Pension Promise 5

Local Pensions 5

Longevity 5

OPEB, Retiree Healthcare 5

Pension Obligation Bonds 6

Public vs. Private 6

Reform 6

Unions 6

SPECIFIC PLACES 6

California 6

Dallas 7

Detroit 7

Houston 7

Illinois 7

New Jersey 7

Pennsylvania 8

KEY ORGANIZATIONS, BLOGS, WEBSITES 8

AND OF COURSE, OUR WELLS FARGO RESEARCH REPORTS 9

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BASICS

Addressing the National Pension Crisis: It’s Not a Math Problem
(2013, September ). Retrieved Dec. 17, 2013, from The PFM Group :
PFM presents a comprehensive analysis of the public pension funding problem.

Blue Ribbon Panel
Belt, A. G., Biggs, A. G., Bilyeu, D. K., Crane , D., Elliott , D. J., Hamilton , M., et al. (2014, February).
Retrieved Feb. 28, 2014, from Society of Actuaries: https://www.soa.org/blueribbonpanel/
The Blue Ribbon Panel was commissioned by the Society of Actuaries to assess the status of pension plan
funding and make recommendations to improve the financial strength of public plans. The link will take you
to the report as well as press coverage and useful other articles on this topic.

GAO
Bovbjerg, B. D., & Czerwinski, S. J. (2012, March 2). Retrieved April 5, 2012, from U.S. Government Accountability
Office: http://www.gao.gov/products/GAO-12-322
While it is a bit dated, this GAO report details a cross-section of plans with lots of useful data that can provide
a starting point if you need to update specific plans or charts.

Buffett, W. (2013, August). Retrieved April 16, 2014, from Value Walk : http://www.valuewalk.com/2013/08/warren-
buffett-letter-katherine-graham/
This is a copy of Warren Buffett's famous letter to Katherine Graham of the Washington Post on the pitfalls of
defined benefit plans...a must read.

Rauh, J. (2014, January). Retrieved March 28, 2014, from Stanford Institute For Economic Policy Research: http://
siepr.stanford.edu/research/publications/causes-and-consequences-rising-costs-public-employee-pensions
A working paper from Professor Joshua Rauh analyzing why public pensions are typically defined benefit plans
while the private sector has moved to defined contribution. There is also detail on rising costs, the gap
between revenues and payments and crowding-out of public services.

TOPICS

COST-SHARE PLANS
Aubry , J.-P., & Munnell, A. H. (2016, January ). Retrieved Jan. 14, 2015, from Center for State & Local Government
Excellence : http://slge.org/publications/how-will-unfunded-pension-liabilities-affect-big-cities
This report focusses on large cities that participate in cost-sharing plans whose liabilities were not reflected on
the cities' financial statements until implementation of GASB 68.

Golub-Sass, A., Haverstick , K., & Munnell, A. (2008, May ). Retrieved Sept. 28, 2015, from Center for Retirement
Research at Boston College : http://crr.bc.edu/briefs/why-dont-some-states-and-localities-pay-their-required-pension
-contributions/
Surprisingly, cost-share pension contributions are often controlled by legislative statute rather than actuarially
determined. Often too, plan document may state they have made their required contributions which may be
accurate but not adequate when considering actuarial calculations.

Shnitser, N. (2015, January 01). Retrieved Sept. 21, 2015, from Digital Commons @ Boston College Law School: http://
lawdigitalcommons.bc.edu/cgi/viewcontent.cgi?article=1932&context=lsfp
Excellent analysis of the condition of cost-sharing plans, which occur among the universities and school
districts.

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CROWDING-OUT
Nation , J. (2011, December ). Retrieved March 19, 2012, from Stanford Institute for Economic Policy Research :
http://siepr.stanford.edu/research/publications/pension-math-how-california-s-retirement-spending-squeezing-state
-budget
Joe Nation’s analysis about how California’s underfunded public pensions are crowding out other spending.

Varghese , R. (2014, April 03). Retrieved April 04, 2014, from Bloomberg : https://www.bloomberg.com/news/
articles/2014-04-04/pennsylvania-schools-shun-debt-amid-austerity-push-muni-credit
This is a Bloomberg article discussing the crowding out of infrastructure improvements in Pennsylvania’s
school districts.

DISCLOSURE
Elizabeth M. Murphy, Secretary . (2010, August 08). Retrieved Aug. 05, 2014, from U.S. Securities and Exchange
Commission : https://secsearch.sec.gov/search?utf8=%E2%9C%93&affiliate=secsearch&query=Release+No.+9135
Links to the SEC’s settlements with the states of New Jersey and Illinois for misleading investors about the
condition of the states’ pension underfunding.

FEDERAL OVERSIGHT
Hatch, O. (2012, January 10). Retrieved Jan. 10, 2012, from Orrin Hatch United States Senator for Utah : http://
www.hatch.senate.gov/public/index.cfm/2012/1/hatch-releases-report-detailing-threat-of-4-4-trillion-public-pension
-debt
This is Utah Senator Orrin Hatch’s policy paper concerning underfunded public pensions and the perceived
implications to the federal budget. The report also details Rep. Devin Nunes’(R-CA) “PEPTA” bill that denies
tax exemption for the bonds of any issuer that fails to fully disclose their pension liabilities using a “risk free”
discount rate.

FUNDING
NGA, NCSL, CSG, NACO, NLC, USCM, et. al. (2013, June). Retrieved April 25, 2013, from National Association of
Counties: http://www.naco.org/sites/default/files/documents/PensionFundingGuide.pdf
Following the GASB accounting changes 67 and 68, which focused on measurement of pension assets and
liabilities but not funding, government groups got together to produce this guide for governments seeking to
fund their pension obligations.

GASB ACCOUNTING CHANGES
(2013, September 10). Retrieved Jan. 30 , 2014, from CALSTRS: http://www.calstrs.com/gasb-accounting-changes
CALSTRS page on GASB pension accounting

Aubry , J.-P., & Munnell, A. H. (2015, June). Retrieved Aug. 31, 2015, from Center for Retirement Research at Boston
College: http://crr.bc.edu/briefs/the-funding-of-state-and-local-pensions-2014-2018/
This report highlights the changes from GASB 25 to GASB 67, particularly noting the change from asset
smoothing to market value. Authors also highlight the seven plans that are using a "blended" discount rate.
This is the case where assets are not expected to be available to cover all liabilities, a key factor for the most
deeply underfunded plans. (For example, the blended rate reduces New Jersey Teachers' funded level to
33.6%.)

GOVERNANCE
Copland, J. R., & Malanga, S. (2016, March 9). Retrieved March 9, 2016, from Manhattan-Institute: http://
www.manhattan-institute.org/html/safeguarding-public-pension-systems-governance-based-approach-8595.html
This report covers and important but often overlooked aspect of public pensions: governance.

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INVESTING PENSION ASSETS
Boyd , D., & Yin , Y. (2016, August 10). Retrieved Aug. 15, 2016, from The Nelson A. Rockefeller Institute of
Government: http://www.rockinst.org/pdf/government_finance/Boyd%20Yin%20NCSL%20Chicago%202016-08-10
(25).pdf
Boyd and Yin analyze pension investing in the era of low returns when many plans have embraced more risky
assets.

LEGAL UNDERPINNINGS OF THE PENSION PROMISE
The Laura and John Arnold Foundation launched the “pension litigation tracker” in 2014 and it follows the status of
cases in each state. The site includes useful links to court documents and decisions. Public Pension Litigation

Monahan, A. (2010, March 17). Retrieved January 17, 2013, from University of Minnesota: https://www.law.umn.edu/
profiles/amy-b-monahan
This link takes you to a bibliography of Professor Monahan’s prolific writings on public pensions and
healthcare. We specifically recommend “Public Pension Reform: the Legal Framework” which details the legal
nature of the pension payment obligation. If you navigate to the resource: “SSRN” and locate “Monahan” you
will find this useful paper.

Munnell, A., & Quinby , L. (2012, Aug. 06). Retrieved Aug. 2012, 2012, from Center For State & Local Government
Excellence: http://slge.org/publications/legal-constraints-on-changes-in-state-and-local-pensions
This paper outlines legal provisions that prevent or permit pension reform.

Selby , A. K. (2012). Retrieved March 4 , 2016, from Texas Tech Law Review : http://texastechlawreview.org/wp-
content/uploads/Selby.pdf
This is a legal discussion of the variety of protections offered to Texas public pensions

LOCAL PENSIONS
Kellar , E. (2015, November ). Retrieved Nov. 23, 2015, from ICMA Publications : http://icma.org/en/press/
pm_magazine/article/106393
This is a comprehensive article on local public sector defined benefit plans from the President and CEO of the
Center for State and Local Government Excellence

LONGEVITY
Aubry , J.-P., Cafarelli , M., & Munnell, A. (2015, April ). Retrieved Feb. 10, 2016, from Center for Retirement Research
at Boston College : http://crr.bc.edu/briefs/how-will-longer-lifespans-affect-state-and-local-pension-funding/
Lifespans have grown since many pension plans were originated making plans more costly. Many plans have
adopted the new mortality tables but some have not. This report explores the issues around longevity

OPEB, RETIREE HEALTHCARE
Barberot , C., Bayer , E., Beaumount , E., Becker, C., Faulk , B., Franzel , J., et al. (2014, Dec.). Retrieved Dec. 23, 2014,
from Center for State & Local Government Excellence: http://slge.org/publications/local-government-strategies-to-
address-rising-health-care-costs
This report covers problems and actions local governments are taking to manage healthcare costs for both
active and retired employees.

Kerrigan , H. (2014, May 22). Retrieved June 03, 2014, from Governing : http://www.governing.com/topics/mgmt/gov
-cities-stop-covering-retired-workers-health-care.html
This article in Governing Magazine details the shift of Detroit’s and Chicago’s retirees to healthcare exchanges
and spousal healthcare coverage. (Beware some potential additional costs for these two cities if the exchange-
based healthcare is eliminated.)

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PENSION OBLIGATION BONDS
Aubry , J.-P., Cafarelli, M., & Munnell, A. H. (2014, July). Retrieved Sept. 4, 2014, from Center For State & Local
Government Excellence: http://slge.org/publications/an-update-on-pension-obligation-bonds
We are frequently asked whether pension obligation bonds are "worth it". The GFOA has recommended against
issuing POBs (see http://www.gfoa.org/pension-obligation-bonds for their advisory). The authors find the
effectiveness of POBs depends heavily on the timing of issuance. Also prevalent, is the fact that governments
facing fiscal stress are often POB issuers, with proceeds being used for budget relief to meet current year
contributions as well as unfunded liabilities.

PUBLIC VS. PRIVATE
Munnell, A. H., & Soto , M. (2007, November). Retrieved Oct. 22, 2010, from Center for Retirement Research at Boston
College : http://crr.bc.edu/briefs/state-and-local-pensions-are-different-from-private-plans/
This report compares public and private sector plans.

REFORM
Becker , C., Brown , A., Franzel , J., Kellar , E., & Miller Wagner , D. (2011, September ). Retrieved June 29, 2012, from
Center For State & Local Government Excellence: http://slge.org/publications/strengthening-state-and-local-
government-finances-lessons-for-negotiating-public-pension-plan-reforms
This report explores reforms implemented by Iowa, Oregon, Vermont, Gwinnett County, Houston. A set of fact
sheets updates findings one year later and adds Denver to the case studies. http://slge.org/publications/
updates-on-five-governments-that-have-negotiated-pension-plan-reforms

McGuinn, P. (2014, February). Retrieved Feb. 28, 2014, from Brookings : https://www.brookings.edu/research/public-
pension-reform-series/
The Brookings Institution report on what can be done to reform public pensions along with their
recommendations for policy changes.

UNIONS
Munnell, A. H., Aubry, J.-P., Hurwitz , J., & Quinby , L. (2011, July). Retrieved July 18, 2011, from Center For State &
Local Government Excellence: http://slge.org/publications/unions-and-public-pension-benefits
This is a fascinating look at the role that unions play in pension benefits and wages.

SPECIFIC PLACES

CALIFORNIA
Brown Jr., E. (2013, Oct. 28). Retrieved October 28, 2013, from Calpensions: https://calpensions.com/2013/10/28/will
-transit-challenge-derail-pension-reform/
Calpensions discusses the interesting consequence of Governor Brown's 2013 pension reform which ran afoul of
federal labor law and threatened BART with the potential loss of federal transit grants.

Mendel , E. (2012, Sept. 11). Retrieved Sept. 11, 2012, from PublicCEO : http://www.publicceo.com/2012/09/pension-
reform-third-of-state-workers-pay-more/
Analysis of California’s pension reforms

Storms , E., & Nation, Ph.D., J. (2012, Feb. 21). Retrieved Feb. 22, 2012, from DocPlayer : http://
docplayer.net/6658291-More-pension-math-evan-storms-stanford-university-california-common-sense-and-joe-nation
-ph-d.html
This report addresses California municipalities that are not part of the state run agent plan: CALPERS or the
state’s school and university cost-share plan: CALSTRs – namely the counties, larger cities and special districts.

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Walsh, M. (2012, March 16). Retrieved March 19, 2012, from The New York Times : http://
www.nytimes.com/2012/03/17/business/untouchable-pensions-in-california-may-be-put-to-the-test.html
We know the outcome, but this article highlights the pension tensions for municipalities in bankruptcy...
written during the Stockton California bankruptcy.

DALLAS
Walsh, M. (2016, Nov. 20). Retrieved Nov. 20, 2016, from The New York Times: http://www.nytimes.com/2016/11/21/
business/dealbook/dallas-pension-debt-threat-of-bankruptcy.html?_r=1
Dallas pension problems

Young , S. (2015, December 03). Retrieved Feb. 05, 2016, from Observer : http://www.dallasobserver.com/news/dallas-
police-and-fire-pension-system-severely-wounded-not-dead-7823201
When investment decisions went awry in Dallas

DETROIT
Christoff, C. (2013, December 02). Retrieved Jan. 13, 2014, from Bloomberg: https://www.bloomberg.com/news/
articles/2013-12-02/detroit-retirees-strike-pay-dirt-with-city-guaranteed-savings
Discussion of Detroit's annuity plan that promised employees a return that is the greater of 8% or actual
earnings that year. (These excess earnings were ultimately clawed back in the city's bankruptcy reorganization
plan.

Russ , H., & Seetharaman, D. (2013, Aug. 09). Retrieved Aug. 12, 2013, from Reuters : http://www.reuters.com/article/
us-usa-detroit-pensions-analysis-idUSBRE9780SC20130809
This news article discusses the changes in unfunded pensions in Detroit from the actuary’s report before the
bankruptcy filing and the increased estimate after the filing

HOUSTON
Cassidy , J. (2015, Sept. 28). Retrieved Feb. 08, 2016, from Watchdog.org Texas Bureau : http://watchdog.org/239667/
houston-union-pension/
Pension reform, Houston style: tug of war between government and employee unions

ILLINOIS
Commision on Government Forecasting and Accountability . (2014, Oct. ). Retrieved July 07, 2015, from CGFA: http://
cgfa.ilga.gov/Resource.aspx?id=5
Illinois pension documents – includes state plans as well as Chicago, Cook County and the Illinois Municipal
Retirement Fund which covers municipalities outside Chicagoland. Downstate Police and Fire financials are
also included.

Dabrowski, T., Jensen , T., & Klingner , J. (2015, Aug.). Retrieved Aug. 16, 2015, from Illinois Policy: https://
www.illinoispolicy.org/reports/cps-pensions-from-retirement-security-to-political-slush-fund/
A critical look at the politics surrounding Chicago Public Schools’ severely underfunded pension plan and their
10-year payment holiday.

NEW JERSEY
Burgos v. State of New Jersey, 075736 (Supreme Court of New Jersey June 9, 2015). http://law.justia.com/cases/new-
jersey/supreme-court/2015/a-55-04.html
In this decision, justices found that Act 78, which was passed in 2011 as the governor’s solution to underfunded
pension plans, cannot create an enforceable and legally binding requirement to make annual payments. The
court stated: “So long as Chapter 78 exists in its present statutory form, each year’s appropriations act will
reflect the present legislative and executive judgment as to the budgetary priority of this pressing need for
which those branches will be answerable to the public and to the financial marketplace. It is not the place of

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this Court to dictate that judgment, for the Constitution has left such budgetary and political questions to the
other two branches.” Mind you, the Court did not say the state should not make payments, rather it placed the
responsibility squarely on the executive and legislative branches.

Khuzami , R. (2010, April 180). Retrieved Aug. 05, 2014, from U.S. Securities and Exchange Commission : https://
www.sec.gov/news/press/2010/2010-152.htm
SEC press release concerning the New Jersey settlement on failure to disclose the state’s pension
underfunding to investors.

Magyar , M. (2014, Dec. 04). Retrieved Dec. 26, 2015, from New Jersey Spotlight : http://www.njspotlight.com/
stories/14/12/03/moody-s-new-jersey-s-pension-funds-could-run-dry-in-just-10-years/
Further detail on New Jersey’s pension problems.

PENNSYLVANIA
Public Retirement Commission . (2015 , Jan.). Retrieved June 08, 2015, from Pennsylvania Public Employee
Retirement Commission : http://www.perc.pa.gov/ReportsandPublications/Pages/Commission'sAnnualReports.aspx
These annual reports detail legislation and advisory memos on the state’s three pension plans for the Governor
and Assembly.

KEY ORGANIZATIONS, BLOGS AND WEBSITES
CENTER FOR STATE AND LOCAL GOVERNMENT EXCELLENCE
“Helping state and local governments become excellent employers so they can attract and retain talented public
servants”. SLGE co-sponsors the Public Plans Database along with the Center for Retirement Research at Boston
College, Slge.org

CENTER FOR RETIREMENT RESEARCH
All manner of research on retirement including state and local government retirement benefits and much more. http://
crr.bc.edu

NATIONAL ASSOCIATION OF STATE RETIREMENT ADMINISTRATORS
NASRA.org posts detailed research and data on a broad range of topics, such as state pension reforms, cost of living
adjustments, accounting changes (to name just a few) as well as individual state information.

PEW CHARITABLE TRUSTS
Pew Charitable Trusts have done numerous papers on public pensions and retiree healthcare. If you navigate to their
main site and go to the dropdown box for “Public Sector Pensions”, you will find their latest research.
www.pewtrusts.org

THE NATIONAL CONFERENCE OF STATE LEGISLATURES
NCSL maintains a database of legislative action relating to pensions in the states (funded by Pew Charitable Trust) that
is searchable by state and topic.

Public Plans Database This database is a joint effort by the Center for Retirement Research at Boston College, the
Center for State and Local Excellence and the National Association of State Retirement Administrators. When you click
on the link, you will find an easily searchable database for the top 100+ public pension plans in the U.S.

Calpensions.com Covers CalPERS, CalSTRS and other government pension plans in California

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Pensiontsunami.com This is an “aggregator” site that has links to recent news items about pensions, both public sector
and corporate

WELLS FARGO RESEARCH — AVAILABLE ON WELLSFARGORESEARCH.COM
Public Pension Sleepers — on investments and governance issues — March 7, 2016

State Revenues and Public Pensions — about the link between market performance and pensions and states with
capital gains and investment taxes — March 23, 2015

Municipal Market Matters: Puerto Rico Pensions — August 21, 2014

Analyzing Public Pensions — April 23, 2014

Public Pension Update — May 17, 2013

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February 1, 2017 MUNICIPAL SECURITIES RESEARCH

Global Head of Research, Economics & Strategy
Diane Schumaker-Krieg, Managing Director, Global Head of Research, Economics & Strategy diane.schumaker@wellsfargo.com (704) 410-1801
(212) 214-5070

Municipal Securities Research
Natalie Cohen, Managing Director Head of Municipal Research natalie.cohen@wellsfargo.com (212) 214-8014

George Huang, Director Healthcare george.huang@wellsfargo.com (212) 214-5061

Randall Gerardes, Vice President Infrastructure randall.gerardes@wellsfargo.com (212) 214-5026

Roy Eappen, Associate General Municipal Analyst roy.eappen@wellsfargo.com (212) 214-8045

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