Overview

This book provides an in-depth explanation of public pension plan management and the decision-making processes surrounding pension policies within state and local governments in the United States. It addresses the intricate balance between securing retirement benefits for public employees and ensuring the fiscal sustainability of pension systems and their sponsoring governments. The book begins with an introduction to the purpose and significance of public pension systems, establishing a foundation for understanding key pension decisions. Using a logic model framework, the authors assess how environmental factors, stakeholders, and legal constraints shape decisions in pension management. The book identifies five core goals for public pension management — benefit sufficiency, cost affordability, funding sustainability, asset management efficiency, and governance quality — emphasizing the relationships among these objectives. Detailed chapters cover investment policies, actuarial processes, and the design of benefits and contributions, explaining the financial and actuarial bases necessary for sound pension decisions. Pension reform efforts, including the transition from defined benefit plans to defined contribution, cash-balance, and hybrid plans, are examined in depth, highlighting the reasons for reforms and analyzing their impacts on the employees and employers. The book concludes with ten takeaways for effective pension plan management and addresses emerging challenges such as fiscal pressures, inflation, and changing demographics. With practical implications grounded in research, this book serves as an essential resource for pension board members, pension system administrators, government officials, legislators and their staff, professionals, researchers, and students involved in public pension plan management.

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9781032671161

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Author Information

Gang Chen is an associate professor of public administration and policy at Rockefeller College, State University of New York, Albany, United States. He is the Co-Director of the State and Local Government Finance Project (SLGF) at the Center for Policy Research at Rockefeller College. Dr. Chen’s research focuses on addressing critical financial management challenges confronting state and local governments. His work on state and local pension plans is widely published in top-tier journals in public administration and public finance. Dr. Chen’s research has been supported by prominent associations and foundations, including the Governmental Accounting Standards Board (GASB), Society of Actuaries (SOA), Center for Retirement Research at Boston College, Equable Institute, Crane Foundation, Laura and John Arnold Foundation, Reason Foundation, and Pew Charitable Trusts. Trang Hoang is an associate professor in the School of Public Administration, University of Nebraska at Omaha, United States. Her primary research interests include public pensions, public/nonprofit budgeting and financial management, health policy, and risk management. Dr. Hoang’s work on public pension reform received the Network of Schools of Public Policy, Affairs, and Administration (NASPAA) Emerging Scholar Award in 2018 and Best Dissertation Award in 2019. Her research projects have been supported by the IBM Center for the Business of Government and the Governmental Accounting Standard Board (GASB). Dr. Hoang is a recipient of the Rosemary O’Leary award for excellent scholarship on women in public administration and public management. Carol Ebdon is a professor emerita in the School of Public Administration at the University of Nebraska at Omaha, United States. Her research interests are in the areas of public budgeting and financial management. Dr. Ebdon has also worked in local government, including as the director of finance for the City of Omaha where her responsibilities included serving as the administrator and a member of the board of trustees for two defined benefit pension plans.

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