Updated May 2026 · DOL Form 5500 + Public Plans Database
Grade F Pension Plans, Critical
4 plans rated Grade F. These plans face serious solvency concerns. Benefit reductions or restructuring may be necessary under PBGC at-risk or PPA Critical-status rules.
Grade F (Critical, score band 0–34/100) — 4 pension plans currently sit in this tier. These plans face serious solvency concerns. Benefit reductions or restructuring may be necessary under PBGC at-risk or PPA Critical-status rules.
Grade F is the lowest rubric bucket — funded ratios below 60% or critical-status designations. 4 plans grade F.
The LakeQuality pension-health rubric weights funding ratio (50%), multi-year funding trend (30%), and PBGC risk classification (20%) into a single 0-100 composite. The letter grade summarizes the composite. For participants, the grade is a triage signal — useful for identifying which plans warrant deeper review. The plan-specific page surfaces the underlying funding-history, contribution-vs-benefit-payment cash flow, and PBGC status that drive the composite.
What Grade F Means in Practice
Grade F plans face the most serious funding stress. Funding ratios typically fall below 55%, 3-year trends are negative, and PBGC risk classifications often include at-risk (corporate single-employer under ERISA Section 430(i)) or Critical/Critical-and-Declining status (multiemployer under PPA). For corporate plans, PBGC backstops benefits up to the statutory annual maximum if the plan terminates underfunded. Public plans rely on state constitutional or statutory protections and the sponsor's taxing authority.
Across the listed Grade F plans, the average funding ratio is 22.1% and aggregate unfunded liability totals $69.7B. The Pension Health Score combines three signals: funding ratio from DOL Form 5500 Schedule SB or MB for ERISA plans and the Public Plans Database for state and municipal systems (50% of the composite), 3-year funding trend measuring the change in funding ratio across recent valuations (30%), and PBGC risk level from PBGC publications (20%, set to low for public plans not subject to PBGC).
A grade is not a recommendation. Participants concerned about a specific plan should review their most recent Annual Funding Notice (mailed under ERISA Section 101(f)) and consult a fee-only fiduciary advisor for plan-specific decisions. PensionRisk does not provide investment advice and does not predict pension failures.
Plans Currently Rated Grade F
| # | Plan Name | Type | State | Participants | Funding Ratio | Unfunded Gap | Score |
|---|---|---|---|---|---|---|---|
| 1 | Kentucky Employees Retirement System (KERS) State of Kentucky | public | KY | 142,000 | 20.4% | $28.1B | 32 |
| 2 | Chicago Municipal Employees Annuity & Benefit Fund City of Chicago | public | IL | 59,000 | 25.3% | $18.0B | 33 |
| 3 | Chicago Policemen's Annuity & Benefit Fund City of Chicago | public | IL | 31,000 | 23.3% | $15.8B | 32 |
| 4 | Chicago Firefighters Annuity & Benefit Fund City of Chicago | public | IL | 13,500 | 19.5% | $7.8B | 29 |
How Grades Are Calculated
The Pension Health Score is a 0–100 composite that maps to letter grades: A (80+), B (65–79), C (50–64), D (35–49), F (below 35). Funding ratio at 100% scores 100; at 50% scores 0; with linear interpolation in between. Trend is scored from −10 percentage points (score 0) to +10 percentage points (score 100). PBGC risk is scored 100 (low), 65 (moderate), 30 (high), 0 (critical). The three factors are weighted 50/30/20 to produce the composite. Read the full methodology.
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Frequently Asked Questions
What does a Grade F pension plan mean?
A Grade F pension plan is severely underfunded with high risk of benefit cuts (Pension Health Score band 0–34/100). The grade combines three factors: funding ratio (50% of the composite), 3-year funding trend (30%), and PBGC risk level (20%). Grade F plans face the most serious funding stress. Funding ratios typically fall below 55%, 3-year trends are negative, and PBGC risk classifications often include at-risk (corporate single-employer under ERISA Section 430(i)) or Critical/Critical-and-Declining status (multiemployer under PPA). For corporate plans, PBGC backstops benefits up to the statutory annual maximum if the plan terminates underfunded. Public plans rely on state constitutional or statutory protections and the sponsor's taxing authority.
How many pension plans are rated Grade F?
PensionRisk currently tracks 4 pension plans at Grade F. The top 4 are listed below by participant count and funding context, covering 245,500 active and retired participants in aggregate.
Should I be worried about a Grade F pension?
These plans face serious solvency concerns. Benefit reductions or restructuring may be necessary under PBGC at-risk or PPA Critical-status rules.
What is the average funding ratio of Grade F plans?
Across the listed Grade F plans, the average funding ratio is 22.1%. Aggregate unfunded liability totals $69.7B across plans below 100% funded. None of these figures are projections — they are the values plan sponsors filed with regulators.
Where does the grading data come from?
Funding ratios come from DOL EBSA Form 5500 Schedule SB or MB for ERISA-covered plans, the Boston College Center for Retirement Research Public Plans Database for state and municipal systems, and PBGC publications for at-risk and Critical-status designations. The current dataset reflects filings available as of May 2026. PensionRisk is a data and education site — none of the content here is investment advice.
Grade F (Critical, score band 0–34/100) — 4 pension plans currently sit in this tier. These plans face serious solvency concerns. Benefit reductions or restructuring may be necessary under PBGC at-risk or PPA Critical-status rules.