States Pull Back on Pension Payments as Virus Ravages Revenue
- Colorado, South Carolina suspend additional pension payments
- Moves will defer pain to future years and increase liabilities
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Colorado and South Carolina have pulled back from making additional payments to their underfunded pensions, moves that may play out in other states that are struggling to balance budgets as the coronavirus ravages tax revenue.
Colorado eliminated a $225 million supplemental payment to the state’s Public Employees’ Retirement System, backing away from a 2018 plan to bolster the pension, which is about 60% funded after suffering from years of inadequate government contributions. South Carolina suspended a statutorily scheduled 1% employer contribution increase for the fiscal year beginning July 1.