New Study Demonstrates Critical State of Hawaii's Unfunded Liabilities

News Release from Grassroot Institute September 10, 2013

HONOLULU, Hawaii -- September 10, 2013 -- Hawaii is ranked among those states facing the most serious problem of unfunded liabilities in terms of both population and economic output. This is according to a new study from State Budget Solutions on the funded status of public employee pension plans which brings to light the severity of Hawaii's unfunded liabilities problem.  Hawaii is among the top-ten states with the highest per capita unfunded liabilities and unfunded liabilities as a percentage of gross state products.

The study, entitled “Promises Made, Promises Broken: The Betrayal of Pensioners and Taxpayers”, takes a hard look at the extent to which each state's unfunded liabilities threaten its economic well-being.  With the salutary lesson of Detroit as a backdrop, it is becoming more and more evident that unfunded liabilities may play a serious role in producing economic crisis.  According to the study, Hawaii's unfunded liability per capita is $19,357, while its unfunded liability as a percentage of gross state product is 37%.

"The numbers bear out what we all know," stated Keli'i Akina, Ph.D., President of Grassroot Institute of Hawaii.  "If Hawaii is going to avoid economic crisis-we are going to have to take stronger measures to reduce our unfunded liabilities."

Dr. Akina continues, "Hawaii's political leaders need the courage to take real and effective measures to avert an impending financial crisis.  We must develop disciplined solutions so that our public employees benefit system does not burden present and future generations of taxpayers with billions in unfunded liabilities."

State Budget Solutions and Grassroot Institute of Hawaii are both affiliated with the State Policy Network's coalition of free-market think tanks. The full State Budget Solutions report can be found at: LINK.

###