Pat Anderson, former State Auditor and Department of Employee Relations Commissioner, today joined the Minnesota Free Market Institute “Pension Reform Project”. Anderson is also the past president of the Minnesota Free Market Institute. Anderson will serve as the lead legislative consultant on pension reform at the Minnesota legislature.
Anderson served as State Auditor from 2002-2006. During her tenure, she was known as an expert on state and local pension issues. Anderson was heavily involved in pension reform, the closing and merger of the Minneapolis Teachers Fund, and the discovery and pursuit of the Minneapolis Police and Fire fund overpayment of $75 million dollars in benefits to retirees. This discovery resulted in a successful lawsuit saving the taxpayers of the City of Minneapolis over $60 million dollars in future costs plus the recuperation of part of the past overpayment.
Minnesota’s public pensions are severely underfunded; the official figure for 2009 unfunded liabilities was $12-15 billion (new numbers should be released this week) . The market value is much higher even though the markets have improved. Compensation and pension decisions are rife with politics. Poor planning threatens the security of state employees and lands on the shoulders of taxpayers who are already struggling to fund their own retirement. Even with fundamental reforms, pension promises will crowd out government spending for core services such as public safety, infrastructure and education.
Minnesota is in a hole; it is time to stop digging. Please visit our pension website www.mnfreemarketinstitute.org/pensions
“The defined benefit pension system creates an environment which encourages life-time public employment,” said Kim Crockett, President of the Minnesota Free Market Institute. “Vested public employees feel they cannot leave the government sector because they will lose a significant share of their pension,” she explained. “On the other hand, talented citizens are discouraged from working short stints in the public sector because they cannot take their entire pension contributions with them when they leave,” Crockett said.
The Institute is thrilled to have Pat working on this important project. Her expertise will help policymakers navigate the complex maze of facts and issues surrounding reform.