The 2022 stock market plunge has taken a toll on some of the nation’s largest state and municipal pension funds, making it harder for governments to pay for future retirement benefits to millions of K-12 teachers and other public employees.

Here, Michael Addonizio, an education policy expert at Wayne State University, provides insight on how teacher pensions are affecting K-12 school budgets overall and what, if anything, can be done to better manage pension systems and close funding gaps.

1. Is there enough money to pay teacher pensions?

Yes and no. There is enough money to pay pension benefits to current retirees. But there is not enough money to pay all promised benefits to future retirees.

U.S. teacher pension funds collectively manage about US$3 trillion in assets. These dollars are invested in various ways – stocks, bonds, real estate, foreign currency, and other ways. But these assets held by the retirement plans are generally less than the plans’ liabilities – that is, the projected cost of benefits promised to future retirees. As of 2022, this gap between assets and liabilities is about $878 billion. Put another way, the ratio of assets to liabilities is about 77%. This ratio is down from about 84% in 2021, but is higher than any other year since 2008.

The amount spent on teacher retirement costs in 2020 – $65.9 billion – represented 5.5% of total state and local K-12 spending.

The problem is that these retirement costs have been growing faster than total K-12 expenditures for decades. In 2001, retirement costs amounted to only 1.3% of total state and local school spending.

The growth in teacher retirement costs is due mostly to an increase in payments for unfunded pension liabilities, often referred to as pension debt. This is the amount of money that states and municipalities pay annually into their retirement systems to cover previously unfunded liabilities – that is, the shortfall that a pension fund needs to pay all future promised benefits.

2. How do these pension funding shortfalls occur?

Every year, pension planners have to make assumptions about how fast teacher salaries will grow, how many teachers will teach long enough to qualify for a pension, how long qualified retired teachers will live and collect benefits and how the pension fund’s investments will perform. If all these assumptions are correct and the plan’s expected assets cover its expected liabilities, the plan is considered fully funded.

But the typical teacher pension plan has not been fully funded at any point since about the year 2000. Overly optimistic investment assumptions are often the biggest part of unfunded liabilities. In response, states or big cities often redirect money from school operating budgets into the pension funds. But these governments often fail to make these payments in full.

States and cities face fiscal pressures from other spending demands and from tax collections that fail to keep pace. Pushing some unfunded pension liability costs into the future is often seen as less painful than cutting current government programs or raising taxes. But skimping on covering costs for future retirees often compounds the system’s liability problem over time.

In 2021, fully 69% of teacher retirement costs went to cover unfunded pension liabilities, up from 17% in 2001. In other words, the cost of future benefits is growing faster than the cost of current-year benefits.

Could it be due to increasingly generous retirement benefits? No. A recent report by the Equable Institute, a bipartisan nonprofit that studies public pensions and advises employees, communities and policymakers, concludes that the average value of lifetime benefits for new teachers is about $100,000 less than for their more senior colleagues.

Rather, unfunded pension liabilities can rise because of downturns in the financial market, lowering the systems’ investment earnings. Also, they may increase when schools hire more teachers and support staff, increasing the numbers of workers in the pension system. It can also be due to the rising cost of borrowing,

3. What does this mean for education funding?

As more public dollars flow to teacher retirement systems, fewer resources are available for schools and classrooms. From 2002 to 2020, total state and local K-12 spending rose 33%, while teacher retirement spending rose 220%. Nationally, and in most states, teacher pension costs have been rising faster than K-12 spending for the past two decades. States then take money from state funds normally dedicated to school operations and move them to the pension fund. The result has been less spending for school operations, in the form of either spending cuts or a smaller share of a growing spending pie.

For example, in the 2022-23 fiscal year, my state of Michigan will pay nearly $3 billion from the state School Aid Fund into the state-administered Public School Employees Retirement System to cover future pension costs. However, while this move will lower the amount of unfunded liabilities in the system, these dollars will come directly from state funds intended to support general K-12 school operations.

This practice has been repeated in many states over the past two decades. According to the Equable Institute study, the “hidden cuts” of using K-12 funds to cover pension costs have risen from $457 per student in 2001 to $1,290 per student in 2021 – a 182% increase in constant 2021 dollars.

4. How can the problem be solved?

The solutions rest with the states, and there is no “one size fits all” remedy. Each state has its own K-12 funding system and teacher retirement plans, which are governed by many rules that are embedded in state constitutions and laws. These state laws vary. For example, teachers in 15 states, including California and Texas, aren’t covered by the Social Security system. But there are some common issues and ways to address them.

One common problem is transparency. While it’s usually relatively easy to see how much states, districts and schools are spending for operations, it’s much more difficult to find public data on teacher retirement costs, particularly pension liability costs, because the data is remarkably scarce.

Pension dollars are as much a part of public education budgets as spending on teacher and staff salaries, books, buses and the rest. Careful monitoring and reporting of pension costs, both payments and liabilities, may improve management of these costs before they inflict more damage on budgets for teaching and learning.

Secondly, many states have reduced their financial support for K-12 schools in recent years. The share of personal income given to K-12 schools has steadily declined since the 2007-2009 Great Recession in 39 states.

States could protect school operating budgets by using general fund revenue to pay pension liability costs, not dedicated K-12 aid. Local districts could be responsible for the cost of current-year retirement benefits but cannot do much to manage unfunded pension liabilities. States could cover pension debt costs without reducing state aid for school operations, but it would require raising taxes or cutting programs in other areas.

To begin moving in this direction, states could restore their pre-recession levels of tax effort for K-12 education. A recent study by researchers from Rutgers University, the University of Miami and the Albert Shanker Institute concluded that had all states done this by 2016, schools would have reaped $288 billion in added funding.

Trading off pension support against school operating funds is not an inevitable result of rising pension costs. Whether states have the economic means or political will to address this problem effectively remains to be seen.

Michael Addonizio, Professor of Educational Leadership and Policy Studies, Wayne State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Another round of powerful atmospheric rivers is hitting California, following storms in January and February 2023 that dumped record amounts of snow. This time, the storms are warmer, and they are triggering flood warnings as they bring rain higher into the mountains – on top of the snowpack.

Professor Keith Musselman, who studies water and climate change at the University of Colorado’s Institute of Arctic and Alpine Research, explained the complex risks rain on snow creates and how they might change in a warming climate.

What happens when rain falls on snowpack?

For much of the United States, storms with heavy rainfall can coincide with seasonal snow cover. When that happens, the resulting runoff of water can be much greater than what is produced from rain or snowmelt alone. The combination has resulted in some of the nation’s most destructive and costly floods, including the 1996 Midwest floods and the 2017 flood that damaged California’s Oroville Dam.

Contrary to common belief, rainfall itself has limited energy to melt snow. Rather, it is the warm temperatures, strong winds and high humidity, which can transport substantial energy in the form of latent and sensible heat, that predominantly drive snowmelt during rain-on-snow events.

Snowpack has air spaces that water can move through. As the rain falls, the water can travel relatively rapidly through the snowpack’s layers to reach the underlying soil. How streams respond to that runoff depends on how much water is already flowing and how saturated the soil is.

When the soil isn’t yet saturated, it can dampen or delay a flood response by soaking up rain and melting snow. But when the ground is saturated, snowmelt combined with rain can lead to fast and devastating flooding.

One of the challenges for dealing with these rain-on-snow events is that the flood risk is hard to forecast.

To predict whether a flood will occur requires knowledge of weather and hydrological conditions. It requires knowing the soil moisture and snowpack conditions before the storm, the elevation at which rain transitions to snow, the rainfall rate, the wind speed, air temperature and humidity, and estimates of how those factors contribute to snowmelt. Additionally, each factor varies in time during a storm and varies in complex ways, especially across a mountainous landscape.

This is why rain-on-snow floods are characterized as compound extreme events. Despite the extensive damage they can cause, it may be surprising how little is known about how they vary in time, spatial extent and intensity.

California is getting another atmospheric river, with more rain on snow expected. How does the rain-on-snow effect differ by elevation in the mountains there?

In the California mountains right now, it’s the middle elevations that people need to pay attention to.

The lower elevations have primarily seen rainfall rather than snow, so there is less snowpack to melt. And in the highest elevations, colder temperatures promote the continued accumulation of deep snowpack and rainfall is less likely.

In the middle transition zone – where either substantial rainfall or snowfall can occur – rain-on-snow events are most common, causing both melting and risk of roof collapses.

If all storms were created equal, there would be well-defined rain zones and snow zones, and the rain-on-snow flood risk would be low. But that isn’t what happens. Instead, not only does the snow zone elevation vary during an event, but it also varies substantially from one storm to the next.

The most destructive rain-on-snow events occur when rivers are already running high and soils are saturated, which can occur in response to a series of warm atmospheric rivers interacting with a deep snowpack – like California’s mountains have right now. The order in which these storms occur – or the storm sequencing – is especially important for assessing flood risk because these events are, in part, caused by rapid shifts between cold periods of snow accumulation followed by warm rainfall events.

What does research show about the future risk of rain-on-snow events in a warming climate?

Even less is known about how rain-on-snow flood risk may respond as the planet warms.

In a warmer climate, there will be less risk of rain falling on snow in the lower elevations as the snowpack declines, particularly in warmer regions such as the Pacific Northwest.

But at higher elevations, more frequent rain-on-snow events are expected. While warmer temperatures are expected to increase rainfall intensity, research shows that’s not the most important driver of this risk. Much of the expected increase in rain-on-snow flood risk is a result of the rain-snow transition zone expanding higher in elevation to include alpine areas that historically received predominantly snowfall.

Flood control and reservoir management systems in these mountainous regions will have to consider these future changes in rain-on-snow events – in addition to changes in rainfall intensity and storm sequencing – to fully understand and prepare for the local flood risk as the planet warms.

So, will projected increases in precipitation extremes and winter rainfall increase rain-on-snow occurrence and the associated flood risk? Or will less snow cover and larger soil moisture deficits reduce rain-on-snow flood risk in a warmer climate?

In a future climate, the response of rain-on-snow flood risk is expected to change in complex and often contradictory ways. The projected changes are likely to vary by region, season, climate model, emissions scenario and future time horizon. It’s a costly risk that requires more research.

Keith Musselman, Assistant Professor in Geography, Mountain Hydrology, and Climate Change, University of Colorado Boulder

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Forests are critically important for slowing climate change. They remove huge quantities of carbon dioxide from the atmosphere – 30% of all fossil fuel emissions annually – and store carbon in trees and soils. Old and mature forests are especially important: They handle droughts, storms and wildfires better than young trees, and they store more carbon.

In a 2022 executive order, President Joe Biden called for conserving mature and old-growth forests on federal lands. Recently Biden protected nearly half of the Tongass National Forest in Alaska from road-building and logging.

The Biden administration is compiling an inventory of mature and old-growth forests on public lands that will support further conservation actions. But at the same time, federal agencies are initiating and implementing numerous logging projects in mature and old forests without accounting for how these projects will affect climate change or forest species.

As scientists who have spent decades studying forest ecosystems and climate change impacts, we find that to effectively slow climate change, it is essential to increase carbon storage in these forests, not reduce it. A first step toward this goal would be to halt logging federal forests with relatively high-biomass carbon per acre until the Biden administration develops a plan for conserving them.

Balancing timber and climate change

Many of the 640 million acres that the federal government owns and manages are used for multiple purposes, including protecting biodiversity and water quality, recreation, mining, grazing and logging. Sometimes these uses conflict with one another.

Legal mandates to manage land for multiple uses do not explicitly mention climate change, and federal agencies have not consistently factored climate change science into their plans. However, at the beginning of 2023, the White House Council on Environmental Quality directed federal agencies to consider the effects of climate change when they propose major federal actions that significantly affect the environment.

Some logging projects fall into this category. But many large logging projects that affect thousands of acres have been legally exempted from such analysis.

What’s lost when old trees are cut

Most forests in the continental U.S. have been harvested multiple times. Today, fewer than 5% of these forests are more than 100 years old. Old, very large trees are the ones that hold the most carbon, and harvesting forests is the main driver of forest carbon loss.

For example, in Oregon’s national forests east of the Cascades crest, a 1990s policy formerly spared trees larger than 21 inches in diameter – but the rule was rolled back in 2021 so that large trees could be cut. A recent analysis found that these larger trees comprised just 3% of all trees in the six national forests, but accounted for 42% of living tree carbon.

In the Green Mountain National Forest in Vermont, federal officials have approved 40,000 acres of harvest since 2016, targeting many mature and old trees. One 14,270-acre area that was approved for harvest in 2019 contained more than 130 stands older than 100 years. This project required the construction of 25 miles of logging roads, which can have harmful effects, including fragmenting forests, polluting streams and making forests more vulnerable to human-caused wildfires.

Canada is also allowing large, mature trees to be harvested. In British Columbia, mature forests that include old-growth trees historically absorbed more carbon than they released to the atmosphere, resulting in a net carbon sink annually. But since 2002, these tracts have emitted more carbon than they removed from the atmosphere, primarily because of logging, beetle attacks and wildfires. According to British Columbia’s greenhouse gas emissions inventory, these forests now emit more carbon than the province’s energy sector.

In eastern Canada, the Pacific Northwest and the southeastern U.S., timber companies have removed many old trees and replaced them with plantations that contain just one or two tree species. This shift has reduced the structural diversity of the forest canopy – the ecologically important layer formed by the crowns of trees – and the diversity of tree species. Losing old-forest habitat has also caused broad-scale population declines among many forest bird species in eastern Canada, and is likely having the same effect in the U.S.

More harvesting releases more carbon

One argument forest product companies make to support logging is that wood can be regrown, and it releases less carbon dioxide to the atmosphere than other building materials. Such claims often make optimistic assumptions that overstate the carbon benefits of harvesting trees by factors of 2 to 100.

Some studies indicate that thinning forests by harvesting some trees and reintroducing low-intensity fires can reduce the intensity of future wildfires, leaving more carbon stored in trees. But these studies don’t account for the large amount of carbon that is released to the atmosphere after trees are cut.

In a review published in 2019, we worked with colleagues to estimate how much carbon was contained in trees that were harvested in Washington, Oregon and California from 1900 through 2015, and what happened to it after the trees were logged. We calculated that just 19% of the harvested carbon was in long-lived wood products like timber in buildings. Another 16% was in landfills, and the remaining 65% was released into the atmosphere as carbon dioxide.

In contrast, in 2011 the Australian state of Tasmania suspended logging on half of its old-growth forest area. Within less than a decade, Tasmania was storing more carbon than it released because it was avoiding harvest emissions and the mature trees it saved were accumulating so much carbon.

In the U.S. Pacific Northwest, implementation of the 1994 Northwest Forest Plan, which the Clinton administration developed to protect endangered species in old-growth forests on public lands, significantly increased carbon storage over the next 17 years. In contrast, privately managed lands in the region accumulated virtually no additional carbon after accounting for losses from wildfire and harvesting.

The cheapest and simplest way to capture carbon

President Biden has set a goal of reducing U.S. greenhouse gas emissions to net-zero by 2050 to avoid catastrophic climate change. To reach that goal, U.S. forests, lands and oceans will have to remove as much carbon dioxide from the atmosphere as the nation emits from fossil fuels, industry and agriculture.

In the western U.S., our research shows that protecting half of the mature carbon-dense forests in zones that are relatively less vulnerable to drought and fire could triple carbon stocks and accumulation on protected forests by 2050. A majority of these forests are on public lands.

The carbon dioxide that human activities are releasing into the atmosphere today will elevate global temperatures and raise sea levels for 1,000 years or more, unless societies can find ways to remove it. In its 2022 climate assessment report, the Intergovernmental Panel on Climate Change concluded that protecting existing natural forests was “the highest priority for reducing greenhouse gas emissions.”

Conserving forests is one of the lowest-cost options for managing carbon dioxide emissions, and it doesn’t require expensive or complex energy-consuming technologies. In our view, sufficient science exists to justify a moratorium on harvesting mature trees on federal lands so that these forests can keep performing their invaluable work.

Beverly Law, Professor Emeritus of Global Change Biology and Terrestrial Systems Science, Oregon State University and William Moomaw, Professor Emeritus of International Environmental Policy, Tufts University

This article is republished from The Conversation under a Creative Commons license. Read the original article.