Underfunded teacher pension fund could hinder future budgets

HARTFORD, Conn. (AP) — A state-run pension fund for public school teachers is $13 billion out of whack, a slow-ticking time bomb that needs to be defused before it blows up the state budget.

The question of how to solve the nagging and astronomically costly challenges to the viability of the Teachers' Retirement System now falls to Gov. Ned Lamont and the state legislature, as a new state budget must be crafted during the next five months.

A number of possible solutions to the fiscal conundrum have been outlined, and any response that state leaders devise is likely to involve a combination of approaches.

Some potential actions include transferring lottery proceeds and other state assets to the pension fund; adjusting the rate of investment returns; higher member contributions; revising cost-of-living adjustments; restructuring benefits; moving new teachers to Social Security or establishing a new retirement plan; having cities and towns contribute to teacher pensions; and paying off pension obligation bonds issued in 2008 early and re-amortizing the debt.

Read more: https://www.ctpost.com/news/education/article/Underfunded-teacher-pension-fund-could-hinder-13567571.php