My recent article, Puerto Rico Illustrates Need For New Public Employee Pension Disclosures, argued that any rescue Puerto Rico rescue bill passed by Congress needs to include the provisions of Rep. Devin Nunes Public Employee Pension Transparency Act (PEPTA), which would require that state and local governments accurately disclose their public employee pension liabilities. This so-called fair market valuation would be accomplished by discounting future pension liabilities, which are guaranteed by law, using the interest rate on guaranteed U.S. Treasury securities. The PEPTA approach would show two things that GASB disclosures dont: that state and local pension plans are on average very poorly funded and that taking more investment risk …
Read the full article at: http://www.aei.org/publication/gasb-public-employee-pension-disclosures-arent-merely-insufficient-theyre-part-of-the-problem/