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Pension system funded at 83.4 percent
Florida’s pension system is 83.4 percent funded to meet its projected future obligations, according to a new state report.
As of July 1, preliminary numbers showed the pension system had what is known as an “unfunded actuarial liability” of $35.6 billion, according to a report by the state’s Florida Retirement System Actuarial Assumption Conference.
It said the “system’s funded status remains essentially the same as the 2021 final valuation at 83.4%.”
After strong investment returns in the 2020-2021 fiscal year, the report said investment returns were hurt during the 2021-2022 year by issues such as inflation, the war in Ukraine and global supply-chain shortages.
The Legislature this year put money into the system to address the unfunded actuarial liability.
“This action and continued full funding of the recommended UAL (unfunded actuarial liability) rate, as committed to by the Legislature, will result — all else being equal — in the gradual increase of the funded ratio over time,” the report said.
“Further, the contribution rates should remain stable so long as contributions are made as recommended and actual experience mirrors projections. Nonetheless, many factors affect these calculations and can cause the contribution rates to increase or decrease. Most importantly, investment returns have been and will continue to be a relatively volatile factor. If actual investment results are lower than assumed, they could significantly impact the UAL and future contribution rates.”
