The employer-based retirement system is not working well for middle income Americans, Brian Graff, CEO of the American Retirement Association, a Washington-based trade group, said Wednesday at a retirement symposium.

Forty-two percent of Americans have less than $10,000 in total savings and 83% of Americans don’t have a retirement plan, according to recent research by the Employee Benefit Research Institute. Graff adds that 60% of middle income American families aren’t saving for retirement because they don’t have a plan offered through their employer. “You can’t get off the bench if you have no playing field,” he said at the event sponsored by AFS 401(k) Retirement Services in

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 Already holding the title for longest state budget stalemate, Illinois is poised to enter a third year without a spending plan as the feud between Republican Gov. Bruce Rauner and Democrats controlling the legislature drags on.

Lawmakers blew past a budget deadline last month, triggering a requirement that any new budget vote be by three-fifths instead of a majority.

They’re expected to return to Springfield for a special session starting Wednesday facing higher stakes to get a budget for the fiscal year that begins July 1.

Unpaid bills are piling up. Rating agencies are threatening to downgrade the state’s credit to “junk.” Uncertainty about schools, transportation projects and social services grows. And campaigning for the 2018 election is well under way in what some predict could become the most expensive governor’s race in U.S. history.

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For over 30 years the IPPFA has offered Public Pension Trustees the best and latest in trustee training. With the recent far reaching changes in pension law and with the difficult challenges yet to come, the IPPFA strives to prepare pension trustees for the future. Please join us for training in Ethics, Investment Procedures, Fiduciary Responsibilities, Legal and Legislative Updates, and more and all with nationally renowned speakers.

2017 IPPFA MidAmerican Pension Conference Summary Page.

Illinois has compiled $14.6 billion in unpaid bills. It’s running a deficit of $6 billion, and its pension liability has soared to $130 billion.

That’s not the worst of it. The state’s nearly two-year failure to pass a budget has sent its bond ratings careening toward junk level, downgraded a staggering eight notches below most other states.

With university enrollments plummeting, large-scale social service agencies shuttering and the Chicago Public Schools forced to borrow just to stay open through the end of this school year, Illinois is beginning to devolve into something like a banana republic — and it’s about to have the most expensive election the state has ever seen.

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Comptroller SUSANA MENDOZA warned the day of reckoning was coming when it came to paying state bills, when all of those court orders, consent decrees and state laws requiring automatic payments would outstrip the cash available to meet them all.

That day effectively came Wednesday when a federal judge said Medicaid providers needed to get paid more and faster than they have been. She didn’t say how it should be done. She left that to Mendoza to work out with attorneys for the Medicaid providers.

The state is paying in full for pensions and debt service, and also a large part of K-12 spending. Any of those areas could be possibilities for coming up with money to meet the latest court order. Or maybe they’ll figure out some other way to shift money into payments for Medicaid.

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Pennsylvania’s two major public pension systems are in for a real shake-up under the legislation that the Legislature is expected to send Gov. Tom Wolf by the end of this week.

Starting in 2019, only hazardous-duty state employees, such as state troopers and corrections officers among others, will be eligible to participate in the current defined benefit system that has been part of public school and state employees’ compensation package for decades.

State employees hired after Jan. 1, 2019, and school employees hired after July 1, 2019, will be forced to move into a new plan that offers them three retirement savings options. Employees hired before that date will have the option of making a one-time switch to one of the new retirement savings plan options.

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With Illinois approaching a third straight year without a state budget, there were fresh signs Thursday that the effects of the unprecedented stalemate will worsen for residents statewide.

Illinois’ credit rating took another major hit, hours after lawmakers adjourned their regular session for the third year without a budget agreement for the fiscal year beginning July 1. The Illinois comptroller, who controls the state’s checkbook, declared the crisis “unconscionable.” Social service agencies — who’ve estimate over 1 million people including seniors and domestic abuse victims have felt the pain — took stock.

Here’s a look at some of the fallout of the ongoing budget fight between Republican Gov. Bruce Rauner and Democrats controlling the Legislature

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Considerations for Pensions Given the IRS’s Delay in Implementing RP-2014

Longevity risk, the risk that plan participants live longer than assumed, gained widespread attention in October 2014 when the Society of Actuaries released its draft of updated mortality assumptions (called RP-2014). Because this was the first update to the standard assumptions in over a decade, the change from the previous tables was noticeable: a boost of life expectancy of two to three years, on average. By 2016, accounting auditors largely required defined benefit plan sponsors to use the updated assumptions on their financial statements, resulting in an average drop in reported funded status of 4%–8%.

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This volume describes major savings and reform proposals included in the 2018 President’s Budget. It includes both discretionary and mandatory savings proposals that bring Federal spending under control and return the Federal budget to balance within 10 years. These proposals encompass a common sense approach to redefine the proper role of the Federal Government, and curtail programs that fall short on results or provide little return to the American people.

In total, this volume highlights 2018 savings of $57.3 billion in discretionary programs, including $26.7 billion in program eliminations and $30.6 billion in reductions. The volume also describes the major mandatory proposals summarized in Table S-6 of the Budget volume.

Going forward, the Administration will build on these proposals in order to implement the President’s charge to create a leaner, more accountable, less intrusive, and more effective Government.

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The brief’s key findings are:

• One option for helping address Social Security’s long-term financial health is to shift a portion of its trust fund reserves into equities.
• Of course, equities would expose the program to greater financial risk.
• However, in terms of financial risk, both retrospective and prospective analyses suggest that equities would improve Social Security’s finances.
• In terms of critics’ concerns:
  • little evidence exists that trust fund equity investing would disrupt the stock market;
  • the experience with the Thrift Savings Plan for federal employees provides a road map for separating the government from investment decisions; and
  • accounting for returns on a risk-adjusted basis would avoid the appearance that substituting stocks for bonds provides magic money.

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