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2016 Amortization Trend Update

The latest Pension Review Board report on actuarial valuations shows that Texas' local pension funds continued the trend of improving their amortization periods.  

 
In October 2015, TEXPERS produced a report showing that Texas' local pensions achieved the most improvement in amortization period health in five years. The report was based on consistent year-over-year comparisons of data available to the PRB in June of each year.

In early February 2016, the PRB produced its latest Actuarial Valuation Report with a six month update from its June report. The data shows that Texas' local pension funds continued the trend of improving their amortization periods.  

The following charts provide the data and breakdowns of the data by period, with commentary. It should be remembered that the 2016 data is for the six month period between June 2015 and January 2016.




Texas state and local pensions with 0 year amortization period Feb 2016

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.
Texas state and local pensions with amortization periods of 15-25 years

The number of pension funds achieving the PRB's recommended amortization period of less than 25 years 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.

Texas state and local pensions with amortization periods less than infinite greater than 40 years

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.

Texas state and local pensions with greater than infinite amortization
Pension funds improving out of the infinite period improved by two. This pension funds numerically had to move into the PRB recommended category of 25 years or less.

 

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