September 8, 2010

Recently a pseudo policy research institute based in Nevada submitted a post about the New Jersey pension system being mismanaged. The SEC investigated the New Jersey pension system and filed fraud charges against the state. The writer then brings up Nevada's PERS right after the New Jersey pension problems which cleverly links the two to make the reader think New Jersey's problems apply to Nevada. He also implies that Nevada should be worried about an SEC investigation.

This is an opinion piece and sham writing.  More is expected from those who claim they do research.

The writer minimized the 2009 changes to PERS and the fact that it is one of the best-managed systems in the country with a rate of return of over 10 percent. There are no dark secrets being kept as implied. And to make things sound worse he links the 2009 billion dollar tax increase to the PERS changes implying the money went to PERS.

You see, you can call yourself an analyst and not really be one if the only thing you have to do is cherry pick data and link unrelated situations.  BS never gets you very far except in politics and the research institute is definitely a partisan group. So much so that it should be investigated by the IRS regarding its tax exempt status.

Here are some more facts about PERS I posted earlier:

Using the industry’s actuarial standard the plan is 70 percent funded.

The unfunded liability is $ 9 billion and the only way it would be a problem is if everyone retired at once which is not likely. It is being addressed, like paying off a mortgage.

Over the past 20 years, the PERS has had a 9.4 percent rate of return on investments. This means 80 percent of benefits are paid by interest earnings.

The fund made $7 billion in the past 10 months or 19 percent and made up much of the losses during the recession.

The fund is at $22.5 billion about $200 million less than when the recession started.

The fund is very conservative and one of the best performing ones in the nation.

As for NV PERS, we must continue to expect transparency and honesty in all their efforts including reports and financial data. If reforms are needed, then they must be openly discussed and decisions based on facts and not political agendas as many want to do.