SANTA FE, N.M. - It's just one more thing for lawmakers in Santa Fe to consider as they get back to the business of making a New Mexico state budget in a special session set for Wednesday, but it's a biggie: Will the state be able to meet its obligations to pay pensions and benefits to public retirees as the ranks of the retired continue to balloon?
Sue Urahn is managing director for the Pew Center on the States, which released a report late last week looking at how each state government is doing in managing its pension and benefit obligations. She says New Mexico comes up somewhere in the middle of the pack, one of the states that isn't of serious concern, but still in need of improvement.
"What we have today is an entirely solvable problem. Modest reforms will have a significant long-term impact. If they wait, if they defer this problem, they will have an unmanageable crisis on their hands."
Urahn says it can be tempting for states to put off addressing pension and other obligations, especially during tough financial times, but that doesn't make the bill any smaller in the future, "It's sort of like a credit card; you can certainly put off your monthly payment, but that bill doesn't go away and it just gets bigger."
Many public employees in New Mexico haven't been happy with some of the reforms so far, including reducing take-home pay to fill in some of the gap. The Land of Enchantment's unfunded pension liability in 2008, $4.5 billion, was greater than the state's annual payroll.
Some good news: New Mexico was among the top 10 states in terms of the percentage of funding set aside for its long-term bill for retiree health care and other benefits besides pensions.
The report is available online at: downloads.pewceneronthe states.org