State and local governments across the country are facing underfunded pension plans and increasing annual pension costs. Baird has a qualified and experienced team of professionals that are well versed in developing alternative funding solutions for unfunded pension and other post-employment benefit liabilities. This includes the issuance of Pension Obligation Bonds (POBs) to pay off all or a portion of the unfunded liability. POBs may be cost-effective when the interest rate on the bonds is less than the actuarial rate on the unfunded liability. There are potential benefits and risks associated with POBs that must be evaluated thoroughly.

Baird has provided a wide range of local and state governments analysis and recommendations related to pension and other post-employment benefits. Focusing on long-term solutions that meet our clients’ needs, we leverage our expertise and depth of resources in creating successful financing solutions.

Below are some of the most commonly requested services we offer:
  • Modeling unfunded pension liability amortization payments
  • Estimates of potential savings
  • Exploration of alternative structuring
  • Sensitivity analysis
  • Risk/benefit analyses, including risk mitigation strategies
  • Pension bond educational sessions for councils, boards and the public


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Illinois Pension Obligation Bonds

Baird is knowledgeable on Illinois Pension Obligation Bonds and the potential benefits and risks.

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