New Center for Excellence Issue Brief
WASHINGTON, Jan. 14 /PRNewswire-USNewswire/ -- The Center for State and Local Government Excellence has issued a new issue brief, Pension Obligation Bonds: Financial Crisis Exposes Risks. The brief, which was written by Alicia H. Munnell, Thad Calabrese, Ashby Monk, and Jean-Pierre Aubry of the Center for Retirement Research at Boston College, finds that it is risky to shore up pensions with such bonds except in certain circumstances.
The brief's key findings are:
- Some state and local governments issue Pension Obligation Bonds (POBs) to raise cash to cover their required pension contributions.
- POBs allow governments to avoid increasing taxes in bad times and could reduce pension costs, but they pose considerable risks.
- Those who issue POBs are often fiscally stressed and not well-positioned to handle the investment risk.
Read the full brief at http://tinyurl.com/pensionobligationbonds
Find all the Center's publications on public sector pensions and retiree health care at www.slge.org.
About the Center for State and Local Government Excellence
The Center for State and Local Government Excellence helps state and local governments become knowledgeable and competitive employers so they can attract and retain a talented and committed workforce. The Center identifies best practices and conducts research on competitive employment practices, workforce development, pensions, retiree health security, and financial planning. The Center also brings state and local leaders together with respected researchers and features the latest demographic data on the aging workforce, research studies, and news on health care, recruitment, and succession planning on its website, www.slge.org.
SOURCE Center for State and Local Government Excellence