Pension health in Hawaii

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Hawaii pension health

Liability (2015) (in millions): $23,238

Debt (2015) (in millions): $8,733

Funded ratio (2015): 62%

Percentage paid (2015): 92%

Note: This page utilizes information from a variety of sources. The information presented on this page reflects the most recent data available as of August 2017.

Pension health is a term used to describe the fiscal condition of a pension system. It can be difficult to gauge pension health in each state; studies use a variety of calculations to determine a pension system's average liabilities, unfunded liabilities, funded ratio, and other metrics. The information on this page comes from two reports by two separate organizations: the Pew Charitable Trusts and the Hoover Institution.

HIGHLIGHTS

According to the Pew Charitable Trusts, the funded ratio for Hawaii's public pension system was 62 percent in fiscal year 2015.

According to the Hoover Institution, Hawaii had unfunded liabilities totaling $28,930,122.

Pew report

See also: Pew Charitable Trusts pensions study, 2017

According to a 2017 report by the Pew Charitable Trusts, “[t]he gap between the total assets reported by state pension systems across the United States and the benefits promised to workers, now reported as the net pension liability, reached $1.1 trillion in fiscal year 2015, the most recent year for which complete data are available. That represents an increase of $157 billion, or 17 percent, from 2014.” The table below provides information about pension plan liabilities and debt, funded ratios, and net amortization. According to the Pew Charitable Trusts, "Net amortization measures whether total contributions to a public retirement system would have been sufficient to reduce unfunded liabilities if all expectations had been met for that year." This metric comprises two parts: an employer contribution benchmark, which is the amount the employer needed to contribute to the plan in a year in order to reduce pension debt, and the percentage of that amount that was actually paid. A positive net amortization percentage (i.e., one exceeding 100 percent) indicates that plans could expect to see a reduction in their debt. In 2015, according to Pew, 32 states saw positive net amortization percentages.

The table below provides information on pension health metrics for Hawaii. Information from surrounding states is provided for comparative purposes. All dollar amounts displayed below should be multiplied by 1,000,000 (e.g., $240,000 is equal to $240,000,000,000).

Pension health metrics from the Pew Charitable Trusts report, fiscal years 2012-2015 (dollars in millions)
State	2015		Funded ratio				Net amortization
	Liability	Pension debt	2012	2013	2014	2015	Employer benchmark	Percent paid
Hawaii	$23,238	$8,733	59%	60%	64%	62%	$1,061	92%
Alaska	$20,808	$6,773	55%	52%	60%	67%	$720	423%
Oregon	$70,665	$5,742	91%	96%	104%	92%	$771	151%
Washington	$85,810	$11,105	95%	88%	90%	87%	$1,625	108%
Totals in the U.S.	$3,850,168	$1,091,828	72%	72%	75%	72%	$102,949	92%
Source: The Pew Charitable Trusts, "The State Pension Funding Gap: 2015," accessed August 21, 2017

Hoover Institution report

See also: Hoover Institution pensions study, 2017

According to a report by the Hoover Institution released on May 15, 2017, "the vast majority of state and local governments continue to understate their pension costs and liabilities by relying on investment return assumptions of 7-8 percent per year." The report stated that, as of fiscal year 2015, the total unfunded liabilities of state and local pension systems totaled $3.846 trillion. The report distinguished between stated unfunded liabilities according to state governments and the market value of those liabilities; the Hoover Institution calculates market value by taking into account the ongoing interest costs and service costs of the plans, which include changes in payments year to year. According to the report, this represented "2.8 times more than the value reflected in government disclosures." The report also stated that, in all states except Alaska, there were large differences between the amount of a state's revenue that must have been contributed to pension funds to prevent unfunded liabilities under the Hoover Institution's expected return rate and the amount actually contributed. The table below provides information from the Hoover Institution report for Hawaii. Information for surrounding states is provided for comparative purposes.

Pension health metrics from the Hoover Institution report, fiscal year 2015 (dollars in thousands)
State	Unfunded liability		Percent of revenue
	Stated	Market Value	Contributed	Required to prevent rise in unfunded liabilities (expected return)	Required to prevent rise in unfunded liabilities (market value)
Hawaii	$8,732,931	$14,424,656	7.8%	8.6%	10.2%
Alaska	$6,770,678	$17,732,398	53.1%	13.6%	18.1%
Oregon	$8,616,500	$39,838,047	4.2%	2.8%	10.8%
Washington	$12,737,525	$67,435,873	3.5%	3.4%	12.7%
Source: Hoover Institution, "Hidden Debt, Hidden Deficits: 2017 Edition," May 15, 2017

Recent news

This section links to a Google news search for the term "Hawaii + public + pensions"

Hawaii public pensions news feed

See also

• Public pensions in Hawaii
• Public pensions in the United States
• Historical Hawaii pension information
• Hawaii state budget and finances
• Tax policy in Hawaii
• Pension statistics
• Public pension health by state
• Public pensions

External links

• United States Census Bureau, Annual Survey of Public Pensions