Gauging the Burden of Public Pensions on Cities


Summary:

This brief examines how much city residents pay for pensions – not just for city pensions, but also for school district and county pensions. (10/24/13)

Author(s):
Alicia H. Munnell, Jean-Pierre Aubry, Josh Hurwitz, and Mark Carafelli of the Center for Retirement Research at Boston College
Publication date:
10/24/13
Filed under:
Research Studies
Key findings:
  • Media stories suggest – especially since the bankruptcy of Detroit – that pensions are the major expense of American cities and could lead to widespread collapse.
  • A comprehensive measure of the cost burden considers how much city taxpayers pay for the pensions of city and county general government workers and teachers.
  • For a sample of 173 cities, these overall pension costs equal 7.9 percent of the total revenue base.
  • The cost burden ranges from 12.3 percent for the highest cost quintile to 2.7 percent for the lowest cost quintile.
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