Proposed federal legislation to standardize pension reporting to a central repository would improve transparency and likely improve pension funding, Moody’s Investors Service said in a special comment released Monday.

The Public Employee Pension Transparency Act, HR 6484, would require state and local governments to file annual financial statements for their pension plans with the Treasury Department. It would also require future liabilities to be calculated using a discount rate based on Treasury rates. Pension funds would have the option of reporting liabilities using different methodologies, as long as they also used the standardized calculations.

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