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By the numbers: Illinois ranks 3rd worst on pension plan funding

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Monday, September 9, 2019  |  Article  |  The Center Square

Pensions (70)
The funded ratio of the Illinois public pension plan ranked 48th in the nation, according to a new analysis from the Tax Foundation based on fiscal-year 2017 data.

The state’s pension fund is 38 percent funded, the Tax Foundation study found. The percentage was calculated by comparing the market value of the pension fund’s assets to its accrued pension liabilities.

The analysis is based on data released by the Pew Charitable Trusts.

A low ratio points to the state’s pension system being not well-funded, and higher ratio means that pension fund assets are keeping up with liabilities, according to the Tax Foundation.

Historically, state pension funds were classified as defined-benefit plans, which guarantee retiring members an annuity for life. More recently, however, states have created defined-contribution plans for new hires, allowing workers to oversee individual accounts and helping states to reduce liabilities over time, the analysis said. 

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State Pension Plan Funding Percentages, From Highest to Lowest

Rank

State

Funded Ratio of State Public Pension Plans

1

Wisconsin

103%

2

South Dakota

100%

3

Tennessee

97%

4

New York

95%

5

Idaho

91%

6

North Carolina

91%

7

Utah

90%

8

Nebraska

90%

9

Washington

90%

10

Oregon

83%

11

Delaware

83%

12

Iowa

82%

13

Maine

82%

14

Ohio

80%

15

Florida

79%

16

Georgia

79%

17

West Virginia

79%

18

Oklahoma

78%

18

Missouri

78%

20

Virginia

77%

21

Arkansas

77%

22

Texas

76%

23

Wyoming

76%

24

Nevada

74%

25

Montana

73%

26

Alabama

71%

27

California

69%

28

Maryland

69%

29

Kansas

67%

30

Alaska

67%

31

Louisiana

65%

31

Michigan

65%

33

Indiana

65%

34

Vermont

64%

35

North Dakota

64%

36

Minnesota

63%

37

New Hampshire

63%

38

New Mexico

63%

39

Arizona

62%

40

Mississippi

62%

41

Massachusetts

60%

42

Pennsylvania

55%

43

Hawaii

55%

44

South Carolina

54%

45

Rhode Island

54%

46

Colorado

47%

47

Connecticut

46%

48

Illinois

38%

49

New Jersey

36%

50

Kentucky

34%

Source: Tax Foundation and the Pew Charitable Trusts