JEFFERSON CITY, Mo. (AP) — Missouri's treasurer says the state employee retirement plan is underfunded by more than $5 billion.
Treasurer Eric Schmitt warned a panel of lawmakers Wednesday that action is needed to prevent a hit on the state's credit rating and finances.
Schmitt told lawmakers that the pension plan is 60 percent funded. He said 80 percent funding is considered healthy.
The treasurer said Missouri has billions of dollars in unfunded liabilities because past administrations had unrealistically high expectations of investment earnings. Schmitt says returns have been below predictions for 16 of the past 17 years. He also said Missouri has been paying expensive investment fees.
Schmitt says he wants to lower investment fees and lower expectations about investment earnings.