WASHINGTON — While the Governmental Accounting Standards Board’s new accounting standards announced Monday will improve financial reporting for public pension plans they also will put added pressure on cash-strapped state and local governments to reform their systems.
“For policy makers it will make the problem more visible and I think it will force policy makers to engage and come up with actual solutions to the problems,” said Matt Fabian, managing director at Municipal Market Advisors. “Most of the solutions up until this point have been on the peripheral, really only treating future workers and their related pensions. What has to be done is somehow adjust or manage the liabilities owed to current retirees and employees. That’s the problem that very few governments have addressed.”