Back in January, I kicked off my Public Finance Spotlight series, highlighting Liz Farmer.

For this second edition, I want to highlight one of my premier data sources for public pensions analysis: the Public Plans Database.

Hop into the Wayback Machine: 2015

You can see me highlighting the Public Plans Database back in 2015 and complaining:

While I’ve been thinking of writing my own public pensions primer (or doing something like that in bite-sized videos), there have been a couple of updated resources that I think are great places to go to. This week I will highlight good resources for those who want a broad view of the issues.

Let’s start out with the enhanced Public Plans Database.

I attended a webcast on its features last week, and while I wasn’t happy with the amount of data in most of the plans I checked out, and while it doesn’t have the built-in graphs I would like, I think this is a great resource for those who want to get a feel for numbers.

For newbies, start out at the Quick Facts page, and drill down to what you are specifically interested in.

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Anyway, explore in Quick Facts to begin with, and then if you want to get really adventurous, you can download the entire database.

Yes, I’m going to do that, but it still does not have the info I want to make the kind of visualizations I want. I still may be able to make my own investigations, though.

So I take that back, 8 years later.

Yes, it did not have the info I wanted, but it was not the fault of the PPD, as I later discovered only one set of plans and one organization compiled the particular information I wanted (and even that was a bit misleading). And I changed my approach after that.

I realized within two years after that bitchy post that the PPD had exactly what I needed for analysis that was meaningful, but also, they incrementally have been expanding the database over the years.

The difficulty of getting good public finance data: lack of uniformity

The big problem in public finance is there is no standard approach in presenting financial reports, unlike with GAAP reporting.

So while we can go to lovely websites and get the latest financial info on whatever rinky-dink publicly-traded company we want, you can’t get standard info on even the largest states, forget about their pension systems. These things are served up in PDFs, in general, though yes, some states and municipalities are getting there in their reporting (and yes, I will get to the info about recent modernization efforts.)

To be able to address the decades of history of public pension misbehavior, I need a record, and that involves somebody else (I don’t have the time) poring through loads of disparate PDFs and putting them into a structured database.

Thanks for the data!

The has done this, first by prioritizing the largest and most important plans by state, and adding more plans each year, and, this is the important part to me, they keep adding more data fields over the years.

They package it all into downloadable data sets, and then I can just take it all in one go and build my own projections and analyses based on those. Thanks!

Thanks for the graphs!

What’s even more helpful, though, is that for each pension plan in their database, they have a page.

So when I don’t want to go through the bother of creating my own graphs, I can just call up that particular page and get key metrics for that plan (also, I can point others to this resource).

Thus, when I did the recent podcast episode on Chicago pensions, I could get the page for all Illinois-based pension plans they have, I could drill down just into the Chicago Municipal fund, but I could also look at the Chicago Teachers fund quickly and check its funded status.

Also linking original research

The Public Plans Database is a project of the Center for Retirement Research at Boston College and MissionSquare Research Institute (formerly the Center for State and Local Government Excellence), so if you go to their front page, you often see a variety of research papers there, such as working papers and briefs.

Here are the ones currently listed:

Public Pensions Contend with Falling Markets and Rising Inflation

The brief’s key findings are:

FY 2022 has been hard for state and local pension plans, with large investment losses and rising outlays due to inflation.

The aggregate funded ratio fell from 78 percent to 74 percent, negating much of the gains from the previous year.

The impact of rising inflation on pension finances, though, has been muted by limits to plans’ cost-of-living-adjustments (COLAs).

However, the flip side of limited COLAs is less inflation protection for retirees, especially those not covered by Social Security.

What Share of Noncovered Public Employees Will Earn Benefits that Fall Short of Social Security?

Social Security is designed to serve as the base of retirement support, to be supplemented by employer-sponsored plans. However, approximately one-quarter of state and local government employees – currently, around 5 million workers annually – are not covered by Social Security on their current job. Federal law allows these noncovered workers to remain outside of Social Security if their state or local plan provides comparable benefits. Since many public pensions have grown less generous in recent years, determining whether state and local plans currently provide comparable benefits is important.

The paper found that:

All retirement plans for noncovered workers follow the letter of the law, but a significant number may still leave noncovered workers falling short of Social Security-equivalent resources in retirement.

Medium-tenure workers who spend the early part of their career in noncovered government employment are at most risk.

These workers represent only a fraction of the noncovered workforce so that, ultimately, about 16 percent of noncovered workers – representing between 750 thousand to 1 million employees annually – could be at risk.

The policy implications are:

While only a fraction of noncovered workers are at risk of falling short, the problem is still serious. Social Security is intended to provide a minimum level of retirement income for all Americans. Thus, learning that between 750 thousand to 1 million noncovered workers annually could ultimately be at risk of not receiving that minimum ­is concerning.

Those are their words, not mine.

Having the tools to check out info is important

I would pay attention to this stuff, as I anticipate calls for various semi-bailouts of public pensions/COLA relief for public pensions. Many public employees are covered by Social Security and many do have COLAs in their public pensions, so pay attention to actual details.

For what it’s worth, this is a data item in the database – I can find out if employees are covered by Social Security, if their pension benefits include COLAs, and if so, what kind of COLAs they include — all in easily queryable terms.

Oh, and if you don’t want to do a data download and want to do something like such a query, here you go: Interactive data browser.

I have found it really important to be able to have such tools at my fingertips.

And, as per ASOP 23 (Data Quality), I am aware of how such a database is created, so over the years I have found some issues do to the manual nature of how these are created (basically, someone reads the info out of a PDF and manually types or copies into the database — so data elements have been transposed sometimes). They link to the original PDFs, so one can check on their sources — so I’ve contacted when I’ve found data that needs repairing. They’ve been very responsive.

This data set has only been getting better over the years, and I really appreciate it!

If you seek to look more into public pensions information, this is a great place to start.