Source: AWC Website as of October 6, 2006
AWC - Personnel & Labor Relations / Key Issue Areas / Pension Issues / September 29, 2006 Pension Rate Update
SEPTEMBER 29, 2006 PENSION R ATE UPDATE
The Pension Funding Council and the LEOFF 2 Board have set pension contribution rates for the 2007-09 biennium. The following charts provide information on current employer and employee contribution rates, as well as the adopted rates through June 30, 2009, for the State’s various pension systems. Future benefit enhancements passed by the Legislature could increase these rates. Note: The adopted PERS employer rate effective July 1, 2007 includes a component of .63% to pre-fund the PERS 1/PERS 3 gain-sharing benefit (revised downward from .71%). As we have reported extensively over the past year, it is unclear what action the 2007 Legislation may take regarding this benefit. If they choose to repeal it, partially replace it with other benefits, or continue to defer accounting for the cost of the benefit, the PERS employer rate effective July 1, 2007 would be lower.
EMPLOYER Pension Contribution Rates
Current Rate (as of 9-1-06)
PERS 1/2/3 PSERS 2 LEOFF 1 LEOFF 2
Rate Effective 1-1-07 5.46% 8.53% 0.18% 4.90%
Rate Effective 7-1-07 6.64% 8.84% 0.18% 5.35%
Rate Effective 7-1-08 8.20% 9.72% 0.18% 5.46%
3.69% 6.76% 0.18% 4.90%
Notes on Employer Rates:
Employer rates include a DRS administrative expense rate, currently 0.18%. Effective 7-1-07, the PERS and PSERS 2 employer rates include a revised gain-sharing component. They also include phased-in payments for the PERS 1 unfunded liability. Although the LEOFF 1 employer contribution rate is set in statute at 6%, employers make no contributions (other than the administrative expense rate) when the plan is fully funded.