Max Baucus: “Ultimately, the question comes down to: Are there enough funds in tier 2, in the railroad retirement fund, to pay…”

“Ultimately, the question comes down to: Are there enough funds in tier 2, in the railroad retirement fund, to pay additional benefits to retirees and spouses and also to decrease the amount of taxes the railroads are now paying? Admittedly, it is a very high rate. That is the question. And can that be done in a fiscally sound manner? Today the railroad retirement trust fund balance is growing very dramatically. Under current law, the trust fund will have balances this year of about six times the cost of benefits. Through about the year 2020, the ratio never sinks below six. At that point, the year 2020, it continues to decline forever. By the end of 75 years, the balances in the trust fund will equal an unbelievable 53 times the cost of 1 year's benefits. So the question is, Why all this increase in balances? Isn't there something prudent that can be done about this very large increase in balances? Because under the actuarial estimates it just continues to grow and grow.”