In May, 2007, the Government Accounting Standards Board, GASB, issued Statement No. 50. Its purpose was to standardize the reporting of the funded status of public pension plans throughout the country. This directive went into effect for the five city pension funds with the financial reporting for the year ending June 30, 2008.
This reporting requirement led to the inclusion of a new table on page 101 in the city’s FY-2008 comprehensive annual financial report, CAFR. This table uses a more standard generally accepted actuarial cost method than the statutory method used by the city pension funds.
These two different methods paint very different pictures of the funded status of the city pension funds. With the new standard method, the funded status of NYCERS has fallen from 136% in 1999 to 80% in 2009. In simple terms, this means that NYCERS has $8 for every $10 it owes. The statutory method reports that for 2009 NYCERS is 100% funded. The NYCERS actuary, however, concedes that the numbers produced using the statutory method “provide limited insight into the ongoing financial performance of the Plan”.
There is no comment by the actuary in either the city or the NYCERS CAFR report about the impact of the standard funded status. The information is clearly stated in the financial report but is completely ignored, at least publicly.
The situation is even worse in the other four city pension funds as indicated on page 101 of the FY-2008 city CAFR. (TRS: 71.8%, BERS: 73.2%, Police: 69.5%)
The funding status at the FDNY pension fund is even more alarming. The standard method indicates a 55.8% funded status for FY-2008 with a benefit payout of $915M based on a payroll of $1B, and a closing balance for the year of $7.2B. The city is making enormous contributions as you can see below and the actuary has only begun to reflect the recent market losses in these costs.
| Fiscal Year | City Contribution to FDNY pension fund |
| 2008 | $780M |
| 2009 | $844M |
| 2010 | $874M |
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