Alaska and North Dakota are the top two states according to TIA’s financial rankings. Both have made a significant improvement in their OPEB funding over the last eight years. OPEB stands for other post-employment retirement benefits, which are composed mainly of retiree health care benefits. The majority of states OPEB plan are underfunded. Alaska has increased its OPEB funding since 2009 by 181.4 percent. North Dakota, the second-ranked state, has also increased its funding by 85.5 percent.
Alaska saw its largest leap in funding from 2016 to 2017 when it jumped from 58.3 percent to 91.5 percent, this is an increase of over 56 percent. North Dakota’s largest increase was between 2013 and 2014, with an increase of 39 percent.
In 2017, Alaska’s OPEBs were all over 90 percent funded besides the Elected Public Officers’ Retirement System, which is zero percent funded. The Elected Public Officers' Retirement System has been zero percent funded for the last eight years. Alaska owes, in total, more than $500 million in OPEB liabilities. North Dakota owes more than $51 billion in unfunded OPEB. Both states have a surplus of money that could be allotted to paying for the unfunded OPEB.
While a lot of people group the Dakotas together, their pension funding could not be more different. South Dakota’s pension plans are fully funded while North Dakota’s pension plans are only 65.5 percent funded on average. This wasn’t always the case, in 2009 there was only a 5.7 percent difference in their pension funding.
South Dakota’s pension funding ratio has been rising since 2009, but never falling below 90 percent funded. While South Dakota did see a slight drop in 2012 it recovered in 2013 with a 99.8 percent funded pension. However, maintaining a surplus is advisable in case of an economic downturn.
North Dakota’s pension funding ratio, on the other hand, has fallen significantly since 2009. In 2009 its pension plans were 84.6 percent funded. The pension funding ratio bottomed out in 2013 at 64.5 percent. In 2014 North Dakota’s pension then increased by 26.4 percent, but ultimately fell to 65.5 percent funded in 2017. This is only 1.5 percent higher than before the 2014 spike.
It is about that time of year that students are about to head back to college, so, with that in mind, we have decided to bring up an issue that almost no one has a solution to: student loans. As student loan debt climbed to $1.23 trillion in 2018, it has become a clear crisis. This upward trend of student debt does not appear to be ending anytime in the near future. If you look at the chart, the amount of student loans has continued to increase without any significant decrease in the last 10 years. There appears to be no solution from federal legislators either on how to solve this crisis, with the exception of forgiving all student loans which would just build on to our already unsustainable national debt.
Along with the student loan debt comes two more concerning data series: student loan delinquency rate and student debt per capita. Since 2003, student debt per capita has increased from $1,135 to $5,438. This makes the student loan delinquency rate especially frightening because, in 2012, the rate jumped up from eight percent to 11 percent and has remained at that rate ever since. This means that while student debt continues to climb throughout the years, more than one out of 10 students are unable to pay off their loans. This is nothing but a recipe for disaster. READ MORE
On Friday, August 2, 2019, President Trump signed a bipartisan budget deal that prevented spending cuts to domestic and military funding and also suspended the debt ceiling until 2021. READ MORE
An alarming issue that many legislators are not putting on high priority at the moment is the crisis that is Social Security. The Financial Report of the United States Government estimated that in 2018, the contributions of future Social Security participants far exceed the benefits they’ll receive by $18.8 trillion. READ MORE
There is an underlying trend among states that are in a poor financial health: they have a lot of lawyers. This is no exception for the five states that have the most lawyers per 10,000 residents. READ MORE
Chicago has been unable to contain spending and pay its bills, with 2018 being significantly worse than the previous year. READ MORE
The men and women who sailed to America in the 1600s in search of a new life would not be too proud of their former colonies today. The 13 original colonies have developed exponentially throughout the years. New York even has the largest populated city in the United States. But who has been paying for the development in these 13 states? Taxpayers. READ MORE
What could be better to boast about than a state’s great weather or nice cities? The answer: the state’s technology and science ranking. Illinois can now proudly show that it was ranked as the No. 15 best state in the Milken Institute's State Science and Technology Index in 2018. READ MORE
We recently analyzed the comprehensive annual financial reports (CAFRs) of the 75 most populous cities so you don’t have to, and the City of San Francisco released some pretty interesting results. READ MORE