|Sneak release of Richard Crowson's latest poster courtesy Kansas Voices.|
[Excerpt] ... Kansas, which was under investigation for four years, has already implemented reforms in how it discloses its pension liabilities and has agreed to settle the charges for its prior incomplete disclosures, without admitting or denying the charges, the SEC said.
According to the SEC, the Kansas pension system was so poorly funded that it created a repayment risk for investors holding the state's bonds, but in bond offering documents the state did not explain the existence of "the significant unfunded liability."
Kansas also should have described how the state legislature could have to appropriate funds to cover the pension liability, thereby making less money available for spending in other areas, including debt service payments, the SEC said.
"Kansas failed to adequately disclose its multi-billion-dollar pension liability in bond offering documents, leaving investors with an incomplete picture of the state's finances and its ability to repay the bonds amid competing strains on the state budget," said LeeAnn Ghazil Gaunt, chief of the enforcement unit on municipal securities and public pensions. ... [End of Excerpt]
Read more at Reuters.