Let’s consider the facts. Financial liabilities of the plan have been growing at a rapid pace. Last year, the plan was funded at only 64 percent. Today, the system’s funded status is 58 percent, well below the recommended level of 80 percent, and unfunded accrued liabilities exceed $14.5 billion. This means more money is needed to get the system solvent.
The PERS Board has increased what taxpayers pay into the system from 9.75 percent to a recommended 15.8 percent, an increase of more than 61 percent without the approval of the Legislature. (Beneficiaries of the plan have also seen their contribution to the plan increase from 7.25 percent to 9 percent.)
This means that millions of taxpayer dollars are being diverted from education, public safety, and other services to pay for the growing cost of the government retirement plan. I’m simply not willing to sacrifice funding for these areas when we could control the cost of the PERS plan.
To be fair, the financial problems faced by PERS aren’t new. They have been growing since the Legislature granted retroactive benefit increases in the late 1990s and early 2000s – which added tremendous costs to the plan. However, the Legislature did not pay for this benefit expansion at the time. Unfunded benefit expansion coupled with the recent market downturns have led to the system’s current funding gap.
Sen. Nancy Collins