Education Report Roundup

Teacher Pensions

By Stephen Sawchuk — April 20, 2010 1 min read
  • Save to favorites
  • Print

Teachers’ pension plans are underfunded by $933 billion, according to an analysis released by the Manhattan Institute and the Foundation for Educational Choice.

According to the paper, that’s close to three times more than official state government estimates of these defined-benefit plans’ liabilities.

The authors attribute the gap to accounting rules for public pensions that permit actuaries to “discount” future obligations based on estimates of how the investments will fare over time. Unlike private-sector plans, public-pension plans aren’t required to take into account how risky those investments are and generally assume strong stock performance.

If the market doesn’t perform as desired, states will have to meet the gap between projections and actual benefit costs by raising taxes or scaling back other education services to meet pension obligations.

The report adjusts the calculations of teacher-pension plans present liabilities by using private-sector discount rates. It also adjusts them based on the market value of current investments to reflect the last few years of economic downturn.

Related Tags:

A version of this article appeared in the April 21, 2010 edition of Education Week as Teacher Pensions

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Classroom Technology Webinar
Academic Integrity in the Age of Artificial Intelligence
As AI writing tools rapidly evolve, learn how to set standards and expectations for your students on their use.
Content provided by Turnitin
Recruitment & Retention Live Online Discussion A Seat at the Table: Chronic Teacher Shortage: Where Do We Go From Here?  
Join Peter DeWitt, Michael Fullan, and guests for expert insights into finding solutions for the teacher shortage.
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Reading & Literacy Webinar
The Science of Reading: Tools to Build Reading Proficiency
The Science of Reading has taken education by storm. Learn how Dr. Miranda Blount transformed literacy instruction in her state.
Content provided by hand2mind

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

Education Letter to the Editor EdWeek's Most-Read Letters of 2022
Here are this year’s top five Letters to the Editor.
1 min read
Education Week opinion letters submissions
Gwen Keraval for Education Week
Education In Their Own Words Withstanding Trauma, Leading With Honesty, and More: The Education Stories That Stuck With Us
Our journalists highlight why stories on the impact of trauma on schooling and the fallout of the political discourse on race matter to the field.
4 min read
Kladys Castellón prays during a vigil for the victims of a mass shooting at Robb Elementary School in Uvalde, Texas, on Tuesday, May 24, 2022.
Kladys Castellón prays during a vigil for the victims of a mass shooting at Robb Elementary School.
Billy Calzada/The San Antonio Express-News via AP
Education In Their Own Words Masking, Miscarriages, and Mental Health: The Education Stories That Stuck With Us
Our reporters share the stories they wrote that rose above the fray—and why.
5 min read
Crystal Curtis and her son, Jordan Curtis, outside their home in Plano, Texas. Crystal, a healthcare professional whose son attends school in Plano talks about the challenges of ensuring quality schooling, her discomfort with the state and district’s rollback of mandatory masking, and the complications of raising a Black child in a suburban district as policies shift.
Crystal Curtis and her son, Jordan Curtis, outside their home in Plano, Texas. Crystal, a healthcare professional whose son attends school in Plano talks about the challenges of ensuring quality schooling, her discomfort with the state and district’s rollback of mandatory masking, and the complications of raising a Black child in a suburban district as policies shift.
Allison V. Smith for Education Week
Education Opinion The Top 10 Rick Hess Straight Up Columns of 2022
NAEP, pre-K, who decides what gets taught. Those are among the most popular or impactful posts of the year.
2 min read
Image shows a multi-tailed arrow hitting the bullseye of a target.
DigitalVision Vectors/Getty