Pay higher wages to our state employees. 100k and lifetime Bentley health care plans do not attract the brightest minds. Could also use 5% annual pay raises. The annual 3% isn't acceptable.

...had described what these recent federal rules changes were. Are the liabilities due to past employees, already retired? Or current working employees? Tier I? Tier...IV?

Also, I'm assuming that we aren't the only community affected by this. Likely every Alaskan community is. So what's the Legislature doing to address it?

Mr. Wanamaker HAS been warning of this for years, perhaps now would be a good time to start listening to him? On this issue and a lot of others, he, better than most elected persons, knows what he is talking about. If he dosn't have an answer he will say so!

so how many years has it been that the legislature identifies the amount they have not funded? It ha to be at least 10 years in a row. Then the same legislature spends hours and hours claiming they will deal with the issue.

Ops the time ran out this session so it will have to wait till next year. That is the solution year after year. So why are we amazed the problem is back again this year.

It has never been a matter of funds to pay down this debt. It has been the priority of spending funds to get reelected and paying down debts like this one does not get one reelected. Sending money for local projects that local communities should pay for gets one votes. Things like: the bridge crossing from Anchorage to the Valley, bailing out the Anchorage Port for its massive screwed up construction project, community halls in villages, more and more studies over the gas line. You know all those things that keeps you in office.

We can repeal the Constitutional protections of benefits then replace the Bentley retirement/healthcare plan with a KIA.

I don't know how easy it is going to be getting another $200 million out of CBJ taxpayers either AKNUT.

What would it take to pay off the $200 Million growing @ 8.25% per year? 10 to 15 years of 10% sales tax (five percent going just to the pension) or double property taxes for the same period with half going to the pension?

Sorry BCZ,

The Pension Board made up mostly of beneficiaries appointed by the Administration created the unfunded liability. It was the Tony Knowles Pension Board the sowed the seeds for this, and subsequent Administrations have not given it the attention it has needed.

Much of what has been said in these blogs is true in my view, and much is not. Lat's questions can be easily answered with the briefest on-line investigation.

The article is very poor but I am happy there is an article at all. The definition of the word several does not include the number two; so which is it, several or two hundred million? Surely we have hired expensive help at CBJ and they can come closer than that.

Brad, sorry but you're wrong in at least a few places. It was successive legislatures that approved the benefits in the defined benefit programs and tiers. The board didn't have and it's successor does not have that authority. Also, the rate once was the 8.25% you cite but is lower now. Lowering the rate raises the current liability of course.

I am skeptical that the Empire has its fact right about this requirement. Instead, I would bet that Ratfish is right, that this is an accounting board requirement. Either way, I am pleased that CBJ must recognize this liability because good management requires recognizing liabilities. Clearly we have had something else.

Changing the Constitution would not change much of anything. The retirement obligations are contractual so these obligations can only be changed for new hires, and in fact that has already happened of course in that new hires are now enrolled in defined contribution tiers. Thinking that was an overall cure would be wrong however. Given that people don't save nearly enough when it's left to them, as with the DC tiers, Alaska teachers hired since 2006 (if I have the year right) in particular will certainly be on welfare and Medicaid when they can no longer work. So the liability has been pushed from one account to another.

But the issue at hand is the unfunded liability from the defined benefit tiers. The state is now paying the minimum (for all employers) required by cash flow but might soon be unable to do that for municipalities given how the $16 billion in state cash has the attention of promoters of every kind of energy project known to man and how the liability keeps growing. CBJ needs to build a reserve but first it needs to determine whether the amount is "several hundred million," "two hundred million" or something else. And CBJ needs to stop selling debt (!) and it shouldn't count on school debt service being reimbursed.

For a quick history of how this happened, read Islander's comment above, then consider something:

There could easily be people in high places who would like to neutralize the unions, and put a stop to overindulgent state workers forever at the same time. They have wondered for a long time how all this easy money/easy work/inflated status thing was going to eventually end. The oil money won't last forever, and at some point the affluence that Juneau has enjoyed for the last 40 years will have to morph into a highly efficient system without personal leave days, vacation days, sick leave days, free money for life just for showing up at work every day with a clean pair of pants. No worries about being fired for incompetence, or a lack of efficiency. A PCN number, and you are IN.

Not paying the retirement system is a great way to force this change. Add to that, all a few politicians have to do is ignore it. There is even the added bonus that you can even spend the money elsewhere, just as if nothing was wrong!

I don't even want to think of what it will be like when the retirement fund crashes, the Union neutralized and all the retirees get paid off a few pennies on the dollar. We will live in a different economy then. The bars will be almost empty and there will not be any recreational conspicuous consumption.

The debt load now is 11 Billion, with a 'B'. I assume the 200 Million dollars people are commenting about is just the interest that must be included on the balance sheet. I may be totally wrong on that - it is very difficult for a ordinary citizen to be aware of all the aspects of this problem, as it is complex and there are many angles that are not common public knowledge. It sure seems to me that everybody who lives here should really see this problem as a potential disaster that could change everything forever.

Just ask the feds to print more money for us. Over 20% of what the fed is spending it is printing anyhow. Why should they be able to tell us to balance our books when they can't balance their own? Since we can just print money to pay our debt, lets do away with income taxes and set up retirement plans for all!

EVERYONE GETS A HOT TUB!

Sorry Glaicerdog, read some history. In 1996 the Pension had a surplus, and the Pension Board cut state contributions. In 1998 they did the same thing, (Bob Storer) telling the Legislature not too worry about making the contribution, they could earn it with the investments. Back in the 70's when the self serving Pension Board blew up the Teachers plan, the Union put a mandatory 8 percent minimum contribution by the employer to the the Teachers plan. The Pension Board cut the States PERS contribution to I think zero the Teachers to the mandatory minimum. I think it was 2001 when the Pension Board put the final nail in the PERS coffin when the waived copays for fellow beneficiaries. Believe it or not, both PERS and TERS had surplus balances as late as 2002.

Cutting employer contributions, expanding benefits and slow reaction to making employer contributions and absurd earning expectations are the primary reasons for the unfunded liability.

They think they are going to earn 8.25% per year, consistently which is nuts! If they were to have realistic earning expectations, say 5%, the unfunded liability would explode to over $30 Billion from the current $11 billion and the CBJ's portion would be a little over $600 million.

Self serving and conflicted beneficiaries of the pension system are doing their best to distort the magnitude of the disaster, but I fully expect the Constitution will be changed before the public signs the Permanent Fund over to the Pension funds.

I don't have time to say much, but you're all mixed up. It's the legislature that determined what beneficiaries are paid, not any board. And the board you cite didn't set the employer contribution rate (which is what you seemed to be speaking about so far as I can tell). Also, the 8.25% rate of return has been lowered. You're mixing boards, investment rate of return with employer contribution rate, and other terminology. However, pension matters are very complicated and everyone misspeaks about the topic. I agree with your philosophy I think, but not your facts.