Americans for Prosperity Comments on Senators Rejecting Bonds for Omaha Public School Pension
Authorizing $300 million in bonds without voter approval is not the appropriate solution to fixing pension woes grassroots group says
LINCOLN, Nebr. – Americans for Prosperity-Nebraska (AFP-NE) on Thursday reacted to the Nebraska legislature’s rejection of LB 548, a bill that would have authorized $300 million in bonds for Omaha Public Schools. Currently, the Omaha Public School pension fund has a $712 million deficit between the fund’s assets and projected liability over the next 30 years.
“Omaha’s Public Schools pension fund is in dire need of reform, but borrowing hundreds of millions of dollars in the name of the taxpayer without getting voter approval would be the wrong thing to do. Bailing out this pension fund won’t address the root causes that got us here,” said AFP-NE State Director Jessica Shelburn. “Lawmakers need to enact reforms that ensure taxpayers will not be on-the-hook to cover the promised benefits of this outdated pension plan. We urge lawmakers to craft a plan that both assures workers receive a check when they retire and protects the interests of taxpayers.”
Background:
Americans for Prosperity advocates for solutions which bring public benefits in line with private benefits, such as adopting 401(k) style retirement plans for new hires.
Reason Foundation’s Vice President of Policy Adrian Moore, outlines 5 steps to pension reform:
- Commit to making full pension payments and paying down pension debt as soon as possible.
- Stop deferring payments or using unrealistic investment return assumptions to artificially lower payments into the pension system.
- Adopt a sustainable system with smooth accrual of pension benefits in line with the private labor market, allowing workers to accrue benefits throughout their career that are portable and devoid of perverse incentives, which protects taxpayers from unnecessary cost risks.
- If necessary, change contracts over time with existing employees to bring benefits in line with the labor market, increase employee contributions, set more realistic retirement ages, and adopt formulas that avoid abuses such as pension spiking (gaming the system to increase the final salary used to calculate pension benefits), pickups (where the government pays the employee’s share of contributions to the pension system), etc.
- Depoliticize management of pension funds and increase their transparency and accountability.
For further information or an interview, reach Jessica Shelburn at jshelburn@afphq.org or (402) 499-6918.
Americans for Prosperity (AFP) exists to recruit, educate, and mobilize citizens in support of the policies and goals of a free society at the local, state, and federal level, helping every American live their dream – especially the least fortunate. AFP has more than 3.2 million activists across the nation, a local infrastructure that includes 36 state chapters, and has received financial support from more than 100,000 Americans in all 50 states. For more information, visit www.americansforprosperity.org
###
