Vesting Requirements and Key Benefit-Formula Features of State and Local Government Pension Plans

State and local governments provide pensions to their employees instead of or along with Social Security coverage. The Great Recession and other events have adversely affected some state and local budgets, leading to pension reforms that aim to lower benefits and bolster funding levels. Using data for 2016–2019 from fund financial reports and independent research center databases, this article examines three key components of standard pension benefit formulas: vesting periods, final-average-salary computation periods, and benefit multipliers. This analysis is the first to examine those characteristics at the level of individual benefit tiers in state and local pension systems, and more significantly, to weight the statistics by the number of active members within each tier. Results are shown for tiers grouped by Social Security coverage status, worker occupation group, and whether the tier is open or closed to new hires