NCPERS Report Urges States to Strengthen Revenues Before Recession Hits by Ending Loopholes, Subsidies
WASHINGTON--(BUSINESS WIRE)--Jan 7, 2020--
State governments need to focus now, before another recession strikes, on closing tax loopholes and ending irresponsible corporate subsidies in order to avoid dire steps such as cutting state services and trimming public employees’ retirement benefits, according to an independent report released by the National Conference on Public Employee Retirement Systems (NCPERS).
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200107005580/en/
Hank H. Kim, Esq., executive director and counsel of the National Conference on Public Employee Retirement Systems (Photo: Business Wire)
Public pensions are in better shape than they have been for a decade, yet pressure to reduce benefits persists due to the hangover effect of many years of state funding missteps, according to Susan E. Kennedy and Richard Sims, authors of “ Ensuring Funding for Public Pensions: A Guide to Raising Revenues and Closing Tax Loopholes.” Particularly in the aftermath of the 2007-08 recession, numerous state governments skipped their scheduled contributions to public pensions, greatly exacerbating the impact of a market crash on public pensions.
State tax revenues are growing more slowly than the national economy, but it doesn’t have to be that way, the authors said. “Meeting future pension plan obligations and commitments to other public services will be much easier if states have an adequate and growing tax revenue structure,” Kennedy and Sims wrote. Unless states adopt more progressive tax systems, the next recession could hit public pensions hard, presenting them with “greater challenges in obtaining the funding to meet any budgetary gaps,” they warned.
Hank H. Kim, executive director and counsel of NCPERS, said state governments have an immediate opening to improve their revenue structures, and need to act decisively. “With the U.S. economy now 10 years into an economic expansion, it’s not a question of if, but when, we will face another recession,” Kim said. “We commissioned this study to get an objective analysis of the options that are open to governments to weather an economic storm, and the findings include practical ideas that state governments can implement.”
The report outlines nine principles for making state tax systems stronger, more resilient, and fairer for both current and future taxpayers.
The National Conference on Public Employee Retirement Systems (NCPERS) is the largest trade association for public sector pension funds, representing more than 500 funds throughout the United States and Canada. It is a unique non-profit network of public trustees, administrators, public officials and investment professionals who collectively manage more than $4 trillion in pension assets. Founded in 1941, NCPERS is the principal trade association working to promote and protect pensions by focusing on advocacy, research and education for the benefit of public sector pension stakeholders.
About the Authors
Susan Kennedy is the principal and owner of Kennedy Consulting LLC, where she is a government relations and policy consultant. She has worked with an array of publicly funded clients to preserve and create additional funding. Richard Sims is CEO of the RGS Economics. He recently served as the Chief Economist for the three million-member National Education Association.
View source version on businesswire.com:https://www.businesswire.com/news/home/20200107005580/en/
CONTACT: Debra Cope
KEYWORD: UNITED STATES NORTH AMERICA DISTRICT OF COLUMBIA
INDUSTRY KEYWORD: FINANCE ACCOUNTING PROFESSIONAL SERVICES STATE/LOCAL PUBLIC POLICY/GOVERNMENT
SOURCE: National Conference on Public Employee Retirement Systems
Copyright Business Wire 2020.
PUB: 01/07/2020 10:40 AM/DISC: 01/07/2020 10:40 AM