CHICAGO — A new accounting standard is requiring Hawaii to come clean about its pension debt, but the state is still hiding billions of pension and health care debt from its financial reports. This information is released today in a report titled, The Financial State of Hawaii, by Truth in Accounting (TIA), a Chicago-based think tank that analyzes government financials.
Because this pension rule was not required in previous years, state officials used outdated accounting methods to calculate the state’s debt. As a result, Hawaii’s reported pension debt increased from $0 in 2014 to $5.8 billion in 2015. But state officials are still not reporting the correct figures.
“Truth in Accounting has been encouraging lawmakers to produce transparent financials for years and it’s great to see a rule in place,” said Sheila Weinberg, Founder and CEO of TIA. “However, it’s not great to see Hawaii state officials only partially implemnt this rule, continuing to hide $1.2 billion of pension debt.”
According to TIA’s report, Hawaii has $6.9 billion of pension debt, but state officials are only reporting $5.8 billion. In addition, state officials are also hiding $5.5 billion of total retirement debt.
“This year, State Comptroller Douglas Murdock, brought some transparency to Hawaii’s financial reports, but more needs to be done,” said Weinberg.
TIA researchers recalculated Hawaii’s overall financial position and discovered the state needs $13.6 billion to completely pay its bills. When this debt is divided amongst Hawaii taxpayers, each taxpayer owes $28,500 – the state’s taxpayer burden.
Data is derived from the state of Hawaii’s June 30, 2015, audited Comprehensive Annual Financial Report and retirement plans' actuarial reports.
Founded in 2002, Truth in Accounting is dedicated to educating and empowering citizens with understandable, reliable, and transparent government financial information. Sheila Weinberg is a Certified Public Accountant with more than 30 years of experience in the field.
Contact: Katherine Oxenreiter
312.589.5104
koxenreiter@truthinaccounting.org
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