When Gov. Charlie Baker lifts the curtain on his fiscal 2021 budget this week, many Beacon Hill observers are going to flip right to the education section to see how great of an increase public schools might get under the new funding law. But there’s another spending area that will grow by an even greater percentage – the annual payment toward the state’s pension liability.
Baker’s budget office filed the new, three-year pension funding schedule Wednesday, detailing how Massachusetts will boost its annual pension payment by more than 9.6% each year – and by more than 30% over the three-year period – as it works to stash away money to cover the $41 billion unfunded portion of the state’s expected pension liability of more than $96 billion.
To remain on track to fully fund the liability by 2036, the state’s annual pension contribution will have to grow at a clip far more rapid than the growth forecast in state tax revenue.
The funding schedule doesn’t just limit some options for lawmakers as they craft the state’s annual budget, but it also impacts the approximately 314,637 retired or active state employees and municipal teachers who are part of the Massachusetts State Employees’ Retirement System or the Massachusetts Teachers’ Retirement System.
Read the whole article in the Milford Daily News.
This article quotes selections from “Pensions grab big share of limited revenue” by Colin A. Young in Milford Daily News.