Fla.’s pension fund underfunded by $19.2 billion

The numbers could change between now and December, when a final report is drawn up. Some of the economists on Monday said the state may need more information on some of the assumptions underlying the new report.

Florida's pension chief has already said that the state may need to ratchet down expectations on how much it expects to make off investments in the coming year.

Ash Williams, executive director of the State Board of Administration, has echoed the concerns expressed by Scott and others that the state is relying on investment returns that may not be achievable in the wake of the 2008 financial meltdown and record-low interest rates that have made it harder to yield large investment returns. Scott once called state and local pensions a "ticking fiscal time bomb" although he did not propose any serious changes this year.

The state now assumes that it will earn 7.75 percent on its investments in order to pay off its pension plan obligations. The state has not consistently met those targets. But if the state were to lower its investment returns it would increase the unfunded portion of the pension plan.

This is the fourth year in a row that the pension fund has been underfunded, which largely occurred because the 2008 financial crisis cost the pension fund billions.

There is right now an expectation that lawmakers will spend roughly $500 million in the coming year to help bring down the size of unfunded portion of the pension plan.

See also:

• How CEOs and politicians messed up pensions
• Milliman 100 companies report $326.8 billion pension funding deficit at close of 2011
• 401(k)s to overtake pensions as primary retirement vehicle in 2012