Pensions/Employee Benefits & Actions

 

Expenditures for employee retirement plans, health insurance, and other benefits, comprise a relatively small portion of total state spending. However, as public employee demographics shift and greater segments of the public sector workforce approach retirement, many states are reexamining the financial costs of promised benefits. Gradual policy and fiscal reforms are being implemented across states to reduce the future budgetary impacts of pensions without drastically undermining the retirement security of present employees or retirees.

Staff Contact: Michael Streepey

NASBO Publications

  • Most state budgets continue to grow at a moderate pace after several years of slow recovery following the Great Recession. For the first time, estimated state general fund spending and revenues in fiscal 2016 surpassed their fiscal 2008, pre-recession peak levels after adjusting for inflation. However, the progress has been uneven across states and long-term spending pressures remain in areas such as health care, education, pensions, and infrastructure. Watch webinar for an overview of the report.
  • Enacted state budgets for fiscal 2016 represent a sixth consecutive year of spending and revenue growth, according to this report. Forty-three states enacted general fund spending increases for fiscal 2016, helping to bolster core services such as K-12 education and health care. Overall, state fiscal conditions continue to be stable, but growth remains modest and long-term spending pressures continue to increase, often faster than state revenues. Watch Webinar for an Overview of the Report
  • Highlights include:- In fiscal 2015, total state spending increased at its fastest rate since 1992, primarily due to growth in federal Medicaid funds resulting from the Affordable Care Act (ACA).- Spending from states’ own funds moderately grew in fiscal 2015, while federal funds to states rapidly increased due to the ACA.- Medicaid represented over half of all federal funds to states in fiscal 2015.- State revenue growth accelerated in fiscal 2015, although it was hampered somewhat by the decline in oil prices.