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With an unfunded liability in the billions – again? still? – New Mexico’s teacher pension fund is in need of some serious structural changes.
The difference between Educational Retirement Board assets and current and future obligations was $9 billion as of July. To put that in perspective, the state’s total spending for the 2019-20 fiscal year was about $7 billion, so the ERB deficit is more than enough to run the entire state for a year.
Reforms enacted in 2019 weren’t expected to get the ERB to full funding for 46 years. Coupled with unfunded liabilities in the state’s other major pension fund, the Public Employees Retirement Association, the unfunded liabilities in the two have played a key role in downgrades to the state’s credit rating.