New Hampshire to bolster public pension funds

In state after state, public retirement systems are coming under scrutiny and attack. Many say public employees should follow their private sector counterparts by having their retirement accounts put at the mercy of the stock market, with defined-contribution pension plans.

New Hampshire, by contrast, is taking a counter-intuitive approach.

By one estimate, 21 percent of all U.S. companies plan to freeze pensions at current levels, while 17 percent report plans to stop offering them altogether. Most are shifting retirement responsibility to their employees through 401(k)s.

But not for public employees in New Hampshire, where the state retirement board is planning to increase costs to state and municipal taxpayers for funding its workers’ pensions.

Today, there are 20,000 retired public workers drawing a pension through the state retirement board, 51,000 active members and a $4.7 billion trust fund.

Meanwhile, state and local contributions toward firefighter pensions are projected to increase from 22 percent of those firefighters’ salaries to 24.4 percent. The state retirement board plans to bump the bill to municipal and state taxpayers for teacher pensions from 5.7 percent of their pay to 8.9 percent. For police officers, the current local and state contribution of 14.9 percent is projected to increase to 18.2 percent.

Those increases would become effective July 1, 2007.