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Maryland's Other Pension Problem: Underfunding by County Governments

"With two-thirds of its state employee pension/benefit system unfunded, Maryland's retirement system is in serious trouble. But according to a new study by the Maryland Public Policy Institute, the situation at the county level is even worse. On average, Maryland's 24 counties are funding only half of what's needed to provide promised post-employment pension, health and insurance benefits to their aging work forces."

Public Employee Unions Are Indirectly Some of Wall Street's Biggest Customers

"On June 30, 2011, the Maryland State Retirement and Pension System ('the System') reported net assets of $37.6 billion.... During the fiscal year ending June 30, 2011, the System spent $221 million on Wall Street money management fees, though fund management appears to have yielded subpar results. There is substantial evidence that Wall Street managers are unable to beat passive equity index funds that cost much less in fees.... The ratio of the System's Wall Street fees equaled 0.693 percent in FY 2011, above the 0.409 percent of similar state systems nationwide."

Marylanders Concerned About State's Ability to Fund State Employee Pensions

"63 percent of Marylanders agree that reducing the estimated $500 million in annual fees paid to the fund's investment management firms is the best way to close the shortfall.... [N]early half of voters (48%) support shifting future state employees to 401(k) style retirement accounts[.]"

Are State Pension Funds Paying Wall Street Too Much?

"A recent report by two Maryland think tanks makes the case for state retirement systems to dump Wall Street investment firms for more passive equity index funds. The study by the conservative-leaning Maryland Tax Education Foundation and Maryland Public Policy Institute outlines fees state pension funds pay investment firms, totaling $7.8 billion nationwide in 2011. This price tag is too high, the authors argue, given their meager returns in recent years."