State Public Pension Plan Strategies for Reporting and Disclosure

A look at practices nationwide

Article September 6, 2017 By: Greg Mennis Read time:

Projects: Public Sector Retirement Systems

The Center for State and Local Government Excellence, with assistance from the National Association of State Retirement Administrators, in 2016 collected a range of data on how major state pension systems communicate financial, benefit, and governance information to their members and other parties. The importance of complete, clear, and timely reporting of pension plan information and communication to members, policymakers, and interested stakeholders continues to grow as reforms are changing retirement benefits for many state and local public employees.

With the work funded by The Pew Charitable Trusts, the report that details the survey results aims to answer two central questions: How do major public pension systems across the United States communicate key financial, benefit, and governance information to their members and other interested parties? And which retirement systems provide examples and demonstrate how to effectively communicate relevant information?

State systems use a variety of approaches to share important information. The map and table below highlight several key approaches. These are among the more commonly used tools:

Experience studies formally monitor how accurate the associated plan’s actuarial assumptions usually over several years. These studies are produced according to state statutes, board rules, and public pension industry best practices. They can help plan fiduciaries determine if they are using the correct assumptions or need to make adjustments. The frequency of experience studies ranged from annually to every eight years; every four or five years was most typical.
Participant newsletters provide nontechnical financial information on a plan. About 75 percent of the governments surveyed offer related financial content in plan newsletters.
A summary plan description (or benefits guide) communicates information to participants about what benefits are provided by the system, how the benefits are structured, benefit eligibility, and related content. These documents are written in plain language and typically include text and charts to help communicate complicated financial information.
A periodic audit is an independent review of a plan’s actuarial statements that is generally completed at a regular interval. This type of audit provides assurance that the plan complies with actuarial standards of practice. It also helps fiduciaries assess whether a pension plan is meeting its funding objectives. The audit can include recommendations for improving the valuation process and presenting results.

For more information on reporting practices and examples of state plans with effective strategies for sharing information with members and other stakeholders, see the Center for State and Local Government Excellence’s full report, “Public Pension Reporting and Disclosure: The Current State of Practice and Examples of What Works Well,” found here.

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Source: "Public Pension Reporting and Disclosure: The Current State of Practice and Examples of What Works Well," Center for State and Local Government Excellence with input and assistance from the National Association of State Retirement Administrators

State	System name	Does the participant newsletter offer information about plan financial condition?	Is a 'plain language,' 'popular,' or 'summary' financial reporting document offered online?	What is the system’s policy on periodic audits of actuarial statements?
Alabama	Retirement Systems of Alabama	yes	yes	required every 5 years
Alaska	Alaska Department of Retirement Services	yes	no	required every 4 years
Arizona	Arizona State Retirement System	yes	yes	not required, but performed every 5 years by practice
Arizona	Arizona Public Safety Personnel Retirement System	yes	yes	every 5 to 7 years by board policy
Arkansas	Arkansas Public Employees Retirement System	yes	no	not required
Arkansas	Arkansas Teacher Retirement System	no	no	not required
California	California Public Employees’ Retirement System	yes	publishes a "strategic plan annual report"	audited annually as part of outside auditor’s reviewof the comprehensive annual financial report
California	California State Teachers’ Retirement System	yes	yes	every 5 years by practice
California	University of California Retirement System	no	yes	required annually
Colorado	Colorado Public Employees’ Retirement Association	yes	yes	required every 5 years
Colorado	Colorado Fire & Police Pension Association	yes	no	not required, but done about every 5 years as a matter of best practice
Connecticut	Connecticut Teachers’ Retirement Board	no	no	not required
Connecticut	Connecticut State Employees’ Retirement System	no	no	not required
Delaware	Delaware Public Employees Retirement System	yes	no	not required
Florida	Florida Retirement System	no	no	required annually
Georgia	Georgia Teachers Retirement System	no	no	not required, but done every 10 years
Georgia	Georgia Employees Retirement System	no	no	not required
Hawaii	Hawaii Employees Retirement System	yes	no	details not available
Idaho	Idaho Public Employee Retirement System	yes	no	required every 4 years
Illinois	Illinois State Employees Retirement System	yes	yes	The State Actuary review process requires annual auditing of actuarial statements and methods.
Illinois	Illinois State Universities Retirement System	yes	yes	not required, but audits were done in 2012 and 2016
Illinois	Illinois Municipal Retirement Fund	yes	yes	required every 5 to 10 years
Illinois	Illinois Teachers Retirement System	yes	yes	required annually
Indiana	Indiana Public Retirement System	yes	yes	required as part of the external audit
Iowa	Iowa Public Employees Retirement System	no	yes	not required, but audits are conducted every 10 years by practice or when actuarial firm changes
Kansas	Kansas Public Employees Retirement System	yes	no	required every 6 years
Kentucky	Kentucky Retirement Systems	yes	yes	conducted every 5 years
Kentucky	Kentucky Teachers Retirement System	yes	no	not required, but audits are conducted every 10 years by practice
Louisiana	Louisiana State Employees Retirement System	yes	yes	not required
Louisiana	Louisiana Teachers Retirement System	no	yes	The legislative auditor reviews the valuation; the state Public Retirement Systems' Actuarial Committee reviews and approves the valuation when setting the projected employer contribution rate.
Louisiana	Parochial Employees’ Retirement System of Louisiana	yes	no	not required
Maine	Maine Public Employees Retirement System	yes	no	required every 5 years per board rule
Maryland	Maryland State Retirement and Pension System	yes	no	required every 5 years or when the actuary changes
Massachusetts	Massachusetts State Employees Retirement System	yes	details not available	required every 3 years (financial statements only)
Massachusetts	Massachusetts Teachers Retirement System	yes	no	not required
Michigan	Michigan Office of Retirement Systems	yes	no	not required
Michigan	Municipal Employees Retirement System of Michigan	yes	yes	required every 5 years per board policy
Minnesota	Minnesota Public Employee Retirement Association	yes	yes	required every 5 years
Minnesota	Minnesota State Retirement System	yes	no	required every 5 years
Minnesota	Minnesota Teachers Retirement Association	yes	no	required every 5 years
Mississippi	Mississippi Public Employees Retirement System	yes	yes	required every 6 years
Missouri	Missouri Public Schools Retirement System	yes	yes	required every 10 years by statute
Missouri	Missouri State Employees Retirement System	yes	yes	required every 10 years by statute
Missouri	Missouri Local Govt. Employees Retirement System	yes	no	required every 10 years by board policy
Missouri	MoDOT & Highway Patrol Employees’ Retirement System	no	no	required every 10 years bystatute
Montana	Montana Public Employees Retirement Board	no	no	required every 3 to 4 years
Montana	Montana Teachers Retirement System	yes	no	details not available
Nebraska	Nebraska Retirement Systems	yes	details not available	required every 10 years if the same actuary is retained
Nevada	Nevada Public Employees Retirement System	yes	yes	required every 10 years
New Hampshire	New Hampshire Retirement System	yes	yes	not required
New Jersey	New Jersey Division of Pension and Benefits	no	no	details not available
New Mexico	New Mexico Educational Retirement Board	yes	yes	required every 5 years per board policy
New Mexico	New Mexico Public Employees Retirement Association	yes	no	not required; conducted first actuarial audit in 2016; considering addinga requirement
New York	New York State and Local Retirement Systems	yes	no	required every 5 years
New York	New York State Teachers Retirement System	yes	yes	required every 5 years
North Carolina	North Carolina Retirement Systems	yes	no	required every 5 years
North Dakota	North Dakota Public Employees Retirement System	yes	no	required every 5 years
North Dakota	North Dakota Teachers Fund for Retirement	yes	no	required every 5 years
Ohio	Ohio State Teachers Retirement System	yes	no	required every 10 years
Ohio	Ohio Public Employees Retirement System	no	yes	required every 10 years
Ohio	Ohio Police & Fire Pension Fund	yes	yes	required every 10 years
Ohio	School Employees Retirement System of Ohio	yes	yes	required every 10 years
Oklahoma	Oklahoma Public Employees Retirement System	yes	yes	not required
Oklahoma	Oklahoma Teachers Retirement System	yes	yes	not required
Oregon	Oregon Employees Retirement System	yes	no	required every 10 years per statute; past practice had been every 8 to 9 years
Pennsylvania	Pennsylvania Public School Employees Retirement System	yes	yes	required every 5 years per practice
Pennsylvania	Pennsylvania State Employees Retirement System	no	no	details not available
Rhode Island	Rhode Island Employees Retirement System	yes	no	required every 5 to 7 years by board rule
South Carolina	South Carolina Retirement Systems	no	yes	not required
South Dakota	South Dakota Retirement System	yes	no	required every 5 years
Tennessee	Tennessee Consolidated Retirement System	yes	no	required every 10 years by board rule
Texas	Teacher Retirement System of Texas	yes	yes	required every 5 years
Texas	Texas Employees Retirement System	no	no	required every 5 years
Texas	Texas County & District Retirement System	no	no	required every 5 years per state law; board policy requires every 4 years
Texas	Texas Municipal Retirement System	yes	yes	required every 5 years
Utah	Utah Retirement Systems	yes	yes	not required, but practice has been every 10 years (most recent was in 2012)
Vermont	Vermont Retirement Systems	no	no	not required
Virginia	Virginia Retirement System	no	other - financial and statistical highlights	required every 4 years, overseen by the Joint Legislative Audit and Review Commission
Washington	Washington Department of Retirement Systems	yes	yes	required every 2 years
West Virginia	West Virginia Consolidated Public Retirement Board	no	details not available	board commissions an external actuary to conduct a peer review of the system's internal actuary
Wisconsin	Wisconsin Retirement System	yes	no	required every 5 years
Wyoming	Wyoming Retirement System	yes	yes	not required, but practice has been every 5 years or when the actuary changes