In her latest column on public pensions, "Shifting pension burden means higher taxes" (June 6) Marta Mossburg conflates a number of issues and misses some important facts. Ignoring last year's pension reform that puts the system on a path for sustainability (80 percent funding by fiscal year 2023 and 100 percent funding in fiscal year 2030), she instead advances and relies on a study — based neither on historical experience nor a methodology appropriate to a governmental entity — that claims each Maryland household will be on the hook for an extra $818 in taxes every year for the next 30 years to fully fund the system.
It is important to note that the latest actuarial study of the retirement system projects full funding in nearly half that time in part due to the measures included in last year's reform shifting more of the burden onto state employees: increasing employee contributions to their retirement by 40 percent; reducing benefits for service earned after June 30, 2011; increasing vesting for new employees from five to 10 years; and reducing the annual cost of living adjustment for service earned on and after July 1, 2011.
Ms. Mossburg also chooses to focus on short-term rates of return for the pension system's investments. While no one can perfectly forecast the future, the pension system's required rate of return is well within the long-term forecasted range based on its diversified asset allocation. And, importantly, it is well under the 25-year average gross return of 8.55 percent actually experienced by the system.
R. Dean Kenderdine, Baltimore
The writer is director of the Maryland State Retirement and Pension System.