Retired government workers decry pension-solvency proposal
SANTA FE, N.M. (AP) — An advocacy group for retired public employees assailed core provisions of a pension reform proposal in defiance of recommendations by the governor, at a legislative hearing Wednesday.
Miguel Gómez, executive director of Retired Public Employees of New Mexico that represents more than 40,000 people, criticized a so-called profit-sharing proposal to tie future cost-of-living increases on retirement payouts to investment returns for the $16 billion retirement fund overseen by the Public Employees Retirement Association. That provision is designed to align changes in pension benefits more closely with combined pension savings.
Unfunded liabilities at the fund exceed $6 billion and have prompted downgrades in credit ratings for the state and cities including Albuquerque that can lead to higher borrowing costs. Leading legislators and administrators of the pension fund have warned that an economic downturn could quickly undermine the fund’s ability to meet future pension obligations.
Gómez told a panel of legislators that immediate, comprehensive solvency reforms are not necessary and that the pension fund can sustain unfunded obligations far into the future. He warned lawmakers of a possible political backlash.
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