Actuarial Fiscal Note
Retirement Systems Impacted by Legislation:
PERS and EMSRS
FUND(S):
PERS 2510; EMSRS
Sources of Revenue:
Other Fund Local Governments
Legislation creates:
Neither Program nor Fund
Actuarial Note Summary
Impact this measure will have on the liabilities and contributions associated with the retirement system(s).
The Bill as amended allows for a 1 year transfer window during which an Emergency Management Services Director currently participating in PERS may transfer to EMSRS. PERS assets and benefits due such Director shall be transferred to EMSRS. The cost of the additional benefits due under EMSRS in excess of the benefits transferred from PERS shall be paid by the Director.
The number of Directors participating in PERS to be eligible for the transfer election is dependent on the required EMS certifications being in place or being completed. It is estimated that qualifying Directors are in the range of 2 to 10 Directors. Since each director must pay the full costs of the excess EMSRS benefit value over the transferring PERS benefit value, the net cost increase is paid by the electing Director and has no impact on the net public pension liabilities.
It is noted that for each transferring Director, the transfer of assets and liabilities from PERS into EMSRS results in an offsetting transactiion between the two plans.
Fiscal Detail of Actuarial Impact
Impact on current benefit costs, prior service benefit costs and ongoing contribution requirements following full implementation.
| Impact On |
Following Full Implementation |
| Increase in Unfunded Actuarial Accrued Liability |
Initial Impact on Annual Contribution Requirement of System(s) |
Contribution Increase as a Percentage of Annual Payroll |
| Total Annual Costs |
$0.00 |
$0.00 |
0.00 % |
| Normal Cost of System |
N/A |
$0.00 |
0.00 % |
| Past Service Liabilities |
$0.00 |
$0.00 |
0.00 % |
Fiscal Year Past Service
Amortization Period Ends |
N/A |
|
N/A |
Explanation of above Actuarial estimates:
Benefits under PERS shall be transferred to EMSRS along with the allocable assets attributable to the transferring Director. The benefits in PERS and EMSRS are offsetting. Additional benefits attributable to EMSRS provisions are fully paid by the transferring Director.
Analysis of Impact on Public Pension Policy:
The Bill as drafted allows for the transfer of assets and liabilities from PERS (non-State employer) into EMSRS (non-State employer).
As required in the original EMSRS transfer provisions, Directors electing to transfer must participate in EMSRS and make contributions at the EMSRS member contribution rate for at least 3 years prior to being eligible to retire under EMSRS following transfer.
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
There is no increase in costs to state government. Transferring Directors under PERS are non-state local government members currently. EMSRS is fully a non-state plan.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2012
Increase/Decrease
(use"-") |
2013
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above Fiscal Note estimates (include possible long-range effect):
All assets and liabilities under PERS and EMSRS impacted by the Bill are local government amounts.
Memorandum
Does not impact State assets or liabilities.
Person submitting Fiscal Note: Harry W. Mandel, Board Actuary, MAAA, MSPA, EA
Email Address: harry.w.mandel@wv.gov