Updated -- TEXPERS Special Report: Texas' State and Local Pension Funds Achieve Best Six-year Measure of Financial Health in 2005-16

Updated Amortization Report 2016

The 93 state and local pension funds which report financial statistics to the Texas Pension Review Board continued a trend in the latter part of 2015 of achieving the best overall six-year improvement to their amortization periods, the PRB’s single “most appropriate” measure of public retirement systems’ health, according to a TEXPERS comparison of PRB data.

The PRB defines amortization period as “the length in time, in years, needed to pay for the unfunded actuarial accrued liability (UAAL) and reflects a system’s ability to pay its normal cost plus UAAL.” UAAL is the present value of benefits earned to date that are not covered by plan assets and normal cost is the portion of cost of projected benefits to the current year.[1]

The following charts demonstrate the findings.


Pension funds achieving the best possible amortization, of 0 years, decreased by one, from three to two. This is the most difficult rating to achieve and it's likely the pension fund that dropped out of this category moved to a slightly lesser category recommended by the PRB in the following charts.

There was no change in the number of pension funds achieving the 0-15 year amortization period, a recommended status from the Pension Review Board.
The number of pension funds achieving the PRB's recommended amortization period of 25 years or less improved by four.
The pension funds achieving an amortization period less than 40 years, but greater than 25 years, outside the PRB recommended range, had no change.

Pension funds improving out of the 40 years to infinite period improved by one. This pension fund numerically had to move into the PRB recommended category.
Pension funds improving out of the infinite period improved by two. Numerically, these pension funds had to move into the PRB recommended category of 25 years or less.