The degree to which state pension funds are underfunded has increased, in part due to lower bond rates. This is because the present value of the liability faced by a state should be estimated by discounting the promised retirement payments at something close to a risk free rate. The risk free rate is very low so the present value of these liabilities is high.
Of course states continue to use 8% to present value these liabilities.
A Finance Professor's blog. I am a Professor of Finance in the Poole College of Management at NC State University. My website: https://sites.google.com/ncsu.edu/warr Opinions are my own.
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