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There I was, perched in the spacious corner office on the 14th floor of the City Financial Building. I had arranged to interview David Shimabukuro, the top administrator of the Employment Retirement System, the keeper of retirement pensions for some 108,696 Hawaii state workers, representing $10 billion in assets and an unfunded liability of $6.2 billion.

I first contacted Shimabukuro after reading a recent study by a Northwestern University professor who predicted that Hawaii’s pension plan would run out of money by 2020. Professor Joshua Rauh said our fund was among the most vulnerable in the nation. Rauh’s warning came months after a report by the Pew Research Center. That study spotlighted Hawaii as one of 21 states with a pension program of “serious concern” that was “lacking progress with taking the necessary steps to ensure their pension plans are financially secure.”

We wanted to hear from the person in charge whether Hawaii taxpayers could be on the hook to pay more taxes to fund the pension plan or whether the state might have to reduce benefits for state workers.
So I sent Shimabukuro an email.

“My name is Noelle, and I am a money reporter-host with Civil Beat, Pierre Omidyar’s new online journalism startup,” I wrote. “I wanted to see if it would be possible sometime to sit down and chat about the ERS program for a Q&A on Civil Beat. The ERS is an important part of our state system, and it would be great to provide more context on it for our readers, especially in context with growing concerns about the ability to afford retirement systems across the U.S…. Would you be available for an hour next week to talk?”

Shimabukuro and I arranged to meet on a Wednesday afternoon.

When I arrived, however, and asked about perceptions that state pensions were in a crisis, Shimabukuro decided not to participate in the interview. Over 25 minutes, he explained that he didn’t have time to talk, and that he was afraid my questions would cause “alarm. And we don’t need that right now.”

Initially, he said, he agreed to meet because he thought I was a student working on a university project. But when I explained to him that Civil Beat was a new online news service seeking to, first, contribute more news coverage and, second, to provide a platform for meaningful, solution-oriented discussion, he said he didn’t have time to answer my questions.

I was taken aback.

I believe ERS is a critical issue that affects many people in Hawaii, I told him. I planned to write about the pension system, so it was important that I talked to the people who really knew it, to make sure our facts were accurate. I wanted to ask questions that Hawaii residents – especially state workers and taxpayers – might be wondering about.

“I just have a lot of stuff on my mind,” he said. “I just have a lot of higher priorities right now.”

And, again: He didn’t want people to panic.

How could it be, I asked myself, that the top administrator of the state’s pension program couldn’t answer basic questions like, “Is Hawaii part of a national crisis or is it all hype?” Or “Is it true that we could run out of money by 2020?” Or “What are some of the most innovative ideas put on the table to solve pension challenges?”

I asked him if there was perhaps someone at his department who would be better to talk with about these issues.

Nope, he said, he was the one to answer my questions. If I gave him printed copies of my questions, though, he might be able to mull them over and answer them at a future date.

“I’m going to retire at the end of this month, so I’m very busy. And I just came back from vacation,” he said. “So if you can give that to me, I’ll take a look, and I’ll call you back, one way or the other.”

‘I have a lot of stuff on my mind’

“After I send you my questions,” I said, “would it be possible to follow up with you tomorrow?”

“Tomorrow, I know, cannot. And then Friday is a furlough day. And then Monday we have a board meeting. In between, I’m working on the board material. But, up to you.”

“How about Tuesday? Are you busy then?”

“We’ll see.”

“How about 3 pm on Tuesday?”

“Yeah, late in the afternoon is OK to call. But I don’t know if I would have my thoughts already,” he said. “I just have a lot of stuff on my mind. and I, kind of, you know, I don’t think I have the time to sit down and help you with this now.

“But maybe next week?”

“Well, next week, I don’t know. Again, I’m saying, that I’m preparing for a lot of stuff. You know, I’ve got to work.”

And then he walked me to the door.

On the way out, I asked him casually about his retirement and how long he had been working at ERS.

“A while.” Then he said, “1982… before you were born probably.”

It didn’t feel like an appropriate response, so I tried to laugh it off.

“Right?”

I laughed again.

“Right?”

“It’s true,” I finally said.

I felt like telling him that when legislators decided to divert $1.7 billion from the ERS contributions in the early 2000s, I still wasn’t old enough to vote. But I think I know how I would have voted if I could have.

We’ll report back on whether we get our questions answered on Tuesday.

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The questions I would have asked

Here are the questions I showed to the ERS administrator.

• The ERS program is only about 66 percent funded. How did we get here?
• Some, such as Progressive States Network, go as far to say that there is no crisis in public retirement systems and the worry is all “hype.” Meanwhile, the February Pew Report puts Hawaii among states with “serious concerns” for pensions. Where do your attitudes lie within this spectrum? Are we really part of a national crisis, or is it all hype?
• What are the biggest challenges that the program faces? (Life span?)
• What do YOU think has to happen for us to solve the problem?
• A recent study by a Northwestern University professor, Joshua Rauh, recently asserted that states like Hawaii would run out of money by 2020. If you know of this study, do you have a particular response to it? If not, is it possible that we could run out of money by 2020?
• By population we are 42nd, yet by funded pensions, we are in the bottom 21. How can this be?
• How are we dealing with this in the post-recession era? Are we counting on unrealistic assumptions about investment returns that were made during boom times?
• Reading the Pew report, I understand that many states could previously count on an 8 percent investment return, but may have to revise this in a post-recession era. What does Hawaii count on now? How do we trust that?
• Pew says Hawaii is one state “lacking progress with taking the necessary steps to ensure their pension plans are financially secure.” How do you respond to that?
• In the earlier part of this decade, we diverted about about $1.7 billion from the funds. What did this mean for the program? Can we recover?
• What are some of the most innovative ideas put on the table to solve pension challenges? (Pension obligation bonds. Sharing risk with employees.)
• How do you balance offering competitive pensions – the typical tool of state governments to attract and maintain employees – with being able to afford it?
• Until 2006, Hawaii had a non-contributory plan — state employees were not asked to match contributions in any way. I understand that this is now being phased in. What type of barriers are there to phasing in this program? Are there any “cultural shifts” that have had or have to occur? What are the pros and cons?
• Last April, UHPA announced that they are considering legal action against ERS for discriminating against research faculty. What happened with that? Was there a legitimate argument?

• Is there enough political will to execute the changes you believe need to be made?