This week you may have read or heard about the budget approved by the Maryland Senate. One of the key features that has our members concerned was the $200 million reduction in the extra pension contributions designated for the unfunded liability. Unfortunately, in order to balance the budget the Senate elected to reduce the scheduled annual payment of $300 million to the unfunded liability, to $100 million. The unfunded liability should not be confused with the Annual Required Contribution or (ARC) that is required each year to cover pending cost. Payments to the unfunded liability were introduced in 2011 as a means to accelerate the funding level. Currently that level is approximately 64% and if the annual contribution of $300 million is made each year the plan would move to an 80% funded level by the year 2024. That 80% is considered an acceptable standard for public pension systems. The reduction in the repayment amount passed by the Senate would delay the schedule of reaching 80% by an additional year.
Follow the enclosed link for a brief presentation by MSEA President Betty Weller and MSEA's Political Director Sean Johnson.