Pew Study Finds States Face $2.73 Trillion Bill for Retire...(said was necessary to cover thecost of p...),Health

-- Twenty states had funding levels of less than 80 percent at the end of FY 2006 -- below what most experts consider healthy.

-- Several states have seen particularly troubling drops in their pension funding levels. Some of the biggest drops have occurred in Hawaii, Kentucky, New Jersey, Pennsylvania and Washington.

Retiree Health Care and Other Benefits

For years states have been required to publicly report their long-term pension liabilities. Until now, they have not had to disclose the price tag of non-pension benefits, such as health care, dental and life insurance. Because of a new rule by the Governmental Accounting Standards Board, states will identify these costs in their FY 2008 financial reports, which are expected to come out between December 2008 and March 2009. The Pew Center on the States has developed a first-of-its-kind preview of these numbers.

Pew found that states' long-term price tag for retiree health care and other non-pension benefits is about $381 billion for state employees alone (excluding obligations for teachers and other local government workers). About 97 percent of that 30-year obligation was unfunded at the end of FY 2006.

Other key findings include:

-- Only six states -- Arizona, North Dakota, Ohio, Oregon, Utah and Wisconsin--were on track at the end of FY 2006 to have fully funded their non-pension promises for the next 30 years. Half of the states account for almost 94 percent of the non-pension liabilities. None of the five largest states -- California, Texas, New York, Florida and Illinois -- had put aside money for non-pension benefits as of FY 2006.

-- Per capita costs for retiree health care and other benefits range from less than $200 in North Dakota, South Dakota and Wyoming to more than $5,000 in Delaware, Hawaii and Connecticut. (Note that per-capita statistics do not tell
'/>"/>