National Association of State Retirement Administrators

State and Local Government Contributions to Statewide Pension Plans: FY 18

Introduction

Pension benefits for employees of state and local governments are paid from trust funds to which public employers and employees contribute during employees’ working years. Timely contributions are vital to both adequate funding and the sustainability of these plans: failing to pay required contributions results in higher future costs due to foregone principal and investment earnings that the contributions would have generated. 

According to the US Census Bureau, on a national basis, contributions made by employers—states and local governments—in 2018 accounted for nearly three-fourths of all contributions received by public pension plans. The remaining contributions were paid by public employees. A 2019 NASRA issue brief finds that contributions made by state and local governments to pension trust funds in recent years account for just less than five percent of all spending. 

This brief describes how contributions are determined; the recent public employer contribution experience; and trends in employer contributions over time.

Date  Published

April 2020

Contact

Keith Brainard, Research Director
Alex Brown, Research Manager


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