My job as state treasurer is to get the best value at the lowest possible cost for taxpayers. This is why I oppose recent efforts to replace Washington’s successful and affordable public pension system with a defined-contribution plan. If implemented, this solution in search of a problem would undermine one of the nation’s most successful public pension systems, expose taxpayers to higher costs and create future unfunded liabilities.
National news stories and editorials about strapped state budgets often point to public pensions as a serious challenge for state and local governments — but this is not a problem here. Washington ranks fourth-highest in the country for funding our pension programs. Our ongoing pension plans are funded at 113 percent of future liabilities based on independent actuarial analyses that determine the value of benefits, the assets available to pay them and plan-funding rates.
Washington state excels at all three key factors in running a cost-effective, well-managed defined-benefit program: benefits are modest and predictable; contributions are shared and well-funded; and investment performance is excellent.