Charleston, W.Va. - Although West Virginia is working to pay down its pension debts, officials say past mismanagement continues to complicate those efforts.
A recent report by Moody's Investor's Service found West Virginia's unfunded pension liability - the amount of money still owed on state employees' retirement plans - is 86.2 percent of its annual revenue in 2011.
That's the 13th highest percentage in the country.
The ranking is based on West Virginia's two largest pension programs, the Teachers Retirement System and the Public Employees Retirement System.
The state's pension liability, as reported by Moody's, is the 24th largest in the nation at $9.2 billion. Illinois' pension liability was $133 billion.
West Virginia still is much better off than states like Illinois or Connecticut, where unfunded liabilities are 241 percent and 190 percent of the states' annual revenues, respectively.
But the Mountain State's pension debt is far above the national average, which is about 60 percent of states' annual revenues. Nebraska has the lowest pension liability in the country, at just 6.8 percent of its budget.
The Moody's report notes "large pension burdens are not associated with the size of a state's economy or budget," but rather "a history of contributing less to their pension plans than the actuarially required contributions."
Moody's said the largest liabilities were created when states did not fund pension plans at a responsible level, deferring payments through "pension holidays" and other quick-fix solutions. While these actions free up money in state budgets for the short-term, they also lead to long-term debts.
State officials say that's how West Virginia found itself near the top of the pension debt list.
"If we would have met those obligations as they were presented, instead of sort of denying in certain years, we'd be a lot better off today," said Senate Finance Chairman Roman Prezioso, D-Marion.
He said lawmakers through the early and mid-1980s neglected to pay the state's pension debts at a responsible level. By 1989, when Prezioso joined the state Senate, West Virginia was more or less bankrupt.
Things are getting better now. At the end of the 2012 fiscal year on June 30, the state' teacher's retirement system was 53 percent funded.