Determinants of local government pension funding: Empirical evidence from Florida

The financial community is well aware that continued underfunding of state and local government pension plans poses many public policy and fiduciary management concerns. However, a well-defined theoretical rationale has not been developed to explain why and how public sector pension plans underfund. This study uses three methods: a survey of national pension experts, an incomplete covariance panel method, and field interviews.^ A survey of national public sector pension experts was conducted to provide a conceptual framework by which underfunding could be evaluated. Experts suggest that plan design, fiscal stress, and political culture factors impact underfunding. However, experts do not agree with previous research findings that unions actively pursue underfunding to secure current wage increases.^ Within the conceptual framework and determinants identified by experts, several empirical regularities are documented for the first time. Analysis of 173 local government pension plans, observed from 1987 to 1992, was conducted. Findings indicate that underfunding occurs in plans that have lower retirement ages, increased costs due to benefit enhancements, when the sponsor faces current year operating deficits, or when a local government relies heavily on inelastic revenue sources. Results also suggest that elected officials artificially inflate interest rate assumptions to reduce current pension costs, consequently shifting these costs to future generations. In concurrence with some experts there is no data to support the assumption that highly unionized employees secure more funding than less unionized employees.^ Empirical results provide satisfactory but not overwhelming statistical power, and only minor predictive capacity. To further explore why underfunding occurs, field interviews were carried out with 62 local government officials. Practitioners indicated that perceived fiscal stress, the willingness of policymakers to advance funding, bargaining strategies used by union officials, apathy by employees and retirees, pension board composition, and the level of influence by internal pension experts has an impact on funding outcomes.^ A pension funding process model was posited by triangulating the expert survey, empirical findings, and field survey results. The funding process model should help shape and refine our theoretical knowledge of state and local government pension underfunding in the future. ^

Material Synthesis and Characterization on Low-Dimensional Cobaltates

In this thesis, results of the investigation of a new low-dimensional cobaltates Ba2-xSrxCoO 4 are presented. The synthesis of both polycrystalline and single crystalline compounds using the methods of conventional solid state chemical reaction and floating-zone optical furnace is first introduced. Besides making polycrystalline powders, we successfully, for the first time, synthesized large single crystals of Ba2CoO4. Single crystals were also obtained for Sr doped Ba2-xSrxCoO 4. Powder and single crystal x-ray diffraction results indicate that pure Ba2CoO4 has a monoclinic structure at room temperature. With Sr doping, the lattice structure changes to orthorhombic when x ≥ 0.5 and to tetragonal when x = 2.0. In addition, Ba2CoO4 and Sr2CoO4, have completely different basic building blocks in the structure. One is CoO4 tetrahedron and the later is CoO6 octahedron, respectively. Electronic and magnetic properties were characterized and discussed. The magnetic susceptibility, specific heat and thermal conductivity show that Ba2CoO4 has an antiferromagnetic (AF) ground state with an AF ordering temperature TN = 25 K. However, the magnitude of the Néel temperature TN is significantly lower than the Curie-Weiss temperature (:&thetas;: ∼ 110 K), suggesting either reduced-dimensional magnetic interactions and/or the existence of magnetic frustration. The AF interaction persists in all the samples with different doping concentrations. The Néel temperature doesn't vary much in the monoclinic structure regime but decreases when the system enters orthorhombic. Magnetically, Ba2CoO4 has an AF insulating ground state while Sr2CoO4 has a ferromagnetic (FM) metallic ground state. Neutron powder refinement results indicate a magnetic structure with the spin mostly aligned along the a-axis. The result from a μ-spin rotation/relaxation (μ+SR) experiment agrees with our refinement. It confirms the AF order in the ab -plane. We also studied the spin dynamics and its anisotropy in the AF phase. The results from inelastic neutron scattering show that spin waves have a clear dispersion along a-axis but not along c-axis, indicating spin anisotropy. This work finds the strong spin-lattice coupling in this novel complex material. The interplay between the two degrees of freedom results an interesting phase diagram. Further research is needed when large single crystal samples are available.