Alaska Taps Rainy-Day Cash for Pension Gap: Muni Credit

Alaska, like local governments across the U.S., is grappling with the pension costs of its retired workers. Unlike other states, Alaska opened its purse and paid a quarter of the bill in cash.

Moving to preserve the state’s top credit ratings, Republican Governor Sean Parnell signed legislation last month that takes the unprecedented step of tapping Alaska’s budget-reserve account to pay unfunded pension liabilities. It will pull $3 billion from the pool to reduce a $12 billion gap.