Welcome to the latest edition of This Week in Pensions! We have gathered the best stories about pensions and retirement security from the previous week. This is the news you need to know in the fight for a secure retirement.
NPPC Highlights
Everyone looks forward to the day they can clock out for good and enjoy a later chapter defined by rest, freedom, and time with loved ones. But for most Americans, especially former public employees, retirement is far from lavish. Many stretch modest, fixed incomes to cover bills that keep climbing, from housing to health care. As expenses rise and the world feels less stable, the post-career landscape for government workers is changing, and will continue to shift long after the balloons are deflated and the cake is gone.
Read our latest Defined Benefit blog to learn how expenses are changing for public workers after their careers end, and what these challenges mean as they plan for retirement and rely on their hard-earned deferred compensation.
State News
Colorado PERA Bonuses Raise Questions About Transparency, Pay, and Public Capacity
A thorough Colorado Sun analysis found this week that Colorado PERA paid substantial staff bonuses as retirees saw the value of their benefits eroded by inflation, and public employees were asked to contribute more to the system.
Pension advocates have long acknowledged that strong public pension systems need skilled, experienced staff. Building in-house public capacity, as Colorado is doing, is often more cost-effective than outsourcing investment management and paying large fees to Wall Street firms. PERA officials defended the compensation program on those grounds, arguing that relying more heavily on private-sector investment managers would cost the system far more.
But public capacity also requires public accountability. Karen Wick of Secure PERA, the state’s NPPC-affiliated labor coalition, said the findings “reinforce why we fought for greater transparency. Hank Kim, executive director of NCPERS and an NPPC board member, added that “public pensions are complex investment entities.” Both points are important: these systems are complicated, and members deserve to understand how pay, incentives, and performance are being measured.
Colorado coalition partners successfully fought back proposals this year that would have cut pension funding and undermined long-term plan stability, building on previous efforts to increase transparency. The same principle applies here: retirement systems should invest in strong public-sector expertise, but they must do so in a way that is accountable, fiscally responsible, and centered on the workers the funds were created to serve.
Public Pension Finances Solid, with Threats and Opportunities on the Horizon
Last week, we shared a Milliman analysis reporting public pension funding at 87.6% through April 30th for the largest U.S. public plans. The number represents years of both strong investment returns, fiscal stewardship, and consistent contributions by plan sponsors.
But strong funding does not mean plans can ignore potential emerging risks. New York City Comptroller Mark Levine, CalPERS CEO Marcie Frost, and New York State Comptroller Thomas DiNapoli are raising serious concerns about the reported governance structure at SpaceX ahead of its anticipated IPO. At the same time, North Carolina State Treasurer Brad Briner said the year’s most closely watched IPO is too expensive for his pension fund to buy into. Pension officials also warn that the company’s proposed shareholder structure could give billionaire and DOGE-zealot Elon Musk extraordinary control while limiting investor rights and accountability.
Together, these developments show why fiduciary discipline matters. Public pension funds are built to provide long-term retirement security, not chase hype, absorb unnecessary governance risk, or overpay for assets because Wall Street says they are exciting.
As we reported in our recent NPPC Legislative Update, coalition affiliates in multiple states overcame efforts this year to cut pension funding. This comes on the heels of a DOGE proposal last year in Iowa to scrap the state’s defined-benefit plan altogether. These schemes would have weakened long-term plan stability and shifted more long-term risk onto workers and retirees.
A $600 Billion Experiment Kicks Off at CalPERS
CalPERS is once again at the center of a national conversation about pension fund investment strategy. The nation’s largest public pension fund is undertaking a major investment shift, including new real estate and infrastructure commitments, as funds across the country continue weighing the promise and complexity of alternative assets.
For workers and retirees, the question is not whether pension funds should seek strong returns. They should. The question is whether those strategies are transparent, cost-effective, and aligned with the long-term interests of the people who earned those benefits.
North Little Rock City Council Votes Down Study of Closed Police and Fire Pensions
The Arkansas Democrat-Gazette’s Daniel McFadin reported this week that the North Little Rock City Council voted down an ordinance that would have funded a $40,000 actuarial study of the city’s closed local police and fire pension and relief funds.
The plans cover police officers and firefighters hired before 1983 and, according to Ward 1 Councilman Nathan Hamilton, have been empty for years. Hamilton argued that before the city can decide whether to act, it needs confirmed numbers from actuaries. He also noted that the last payment to retirees from the plans was just $600 in 2016. Council members raised concerns about fairness to non-uniformed retirees who also have not received increases. However, instead of ordering a study to understand the city’s options, the council voted the measure down.
Be sure to check back next Friday for the latest news in the fight for a secure retirement! For now, sign up for NPPC News Clips to receive daily pension news from across the country directly to your inbox.