Ind. pours surplus into pension funds

INDIANAPOLIS (WISH) - Governor Mitch Daniels announced Thursday that $360 million is being invested in state pension funds. The money is coming from the state's $2.1 billion budget surplus. It's because the same law that created an automatic taxpayer refund calls for money to go into state pension funds first.

Daniels joined with state Senator Luke Kenley (R-Noblesville) to hand out symbolic checks to representatives of five state pension funds.

The contributions mean that four of those pensions are funded at the 80 percent level, making them sound.

"This is kind of a remarkable occurrence that we're able to do this at this particular point in time in our history," said Sen. Kenley.

The teacher's pension fund is the only exception, but it received the biggest contribution, $206 million, and the governor says it is now on solid financial footing. Other states, he said, can't honor pension commitments.

"That will never be the case in Indiana," said Daniels, "and we are taking further steps today to secure what are already by every measure the most secure set of pension plans in the country."

Indiana’s teacher’s pension fund faces massive unfunded liabilities. A series of I-Team 8 investigations last year showed the fund $11 billion short. A Pew Center on the States study released in June projected the deficit has grown to eclipse $14 billion.

An equal amount of money, $360 million, will go to taxpayers in refunds on 2013 tax forms. The exact size of that refund won't be determined for another three weeks. It's expected to be more than $100.

Meanwhile, the governor says the state is on track for another $2 billion dollar surplus next July and a repeat of the pension investments and taxpayer refunds.