- The 25 most populous U.S. cities have more than $125 billion of unfunded pension liabilities;
- Twenty-two of the largest cities have the majority of their pension liabilities tied to a pension plan where the city is the major participant, which means the pension liability will have to be funded either solely or mainly by the city;
- Approximately half of the cities evaluated in Morningstar's report contributed the full Annual Required Contribution (ARC), or the required dollar amount a city would need to pay to fund employee benefits earned in the last fiscal year;
- San Jose, Calif.'s 2012 pension contribution was 29.7 percent of general fund spending, the highest among the largest 25 cities;
- Memphis, Tenn. made the smallest pension contribution in 2012 of 3.1 percent of general fund spending;
- Three cities have a funded ratio—the pension plan's assets divided by its liabilities—of more than 90 percent: Detroit, Mich., San Antonio, Texas, and Washington, D.C.;
- Washington D.C. is the strongest among the cities reviewed in the report, with funding for its pension plans above 100 percent;
- Seven of the evaluated cities fall below Morningstar's fiscally sound threshold of a 70 percent funded ratio; and
- Chicago is the weakest-funded city pension system among the cities reviewed in the report, and has the lowest funded ratio of 35.2 percent.
Morningstar Evaluates Fiscal Health Of 25 City Pension Plans; Finds Washington, D.C. The Strongest-Funded City Pension Plan And Chicago The Weakest
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