FISCAL NOTE
FUND(S):
PERS 2510; TRS 2601
Sources of Revenue:
Other Fund State and Local Govnts
Legislation creates:
Neither Program nor Fund
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The benefit increases to retired members of PERS and TRS exceed the limitation contained in 2005 Pension Reform.
For PERS, the Section 5-10-22h retiree increase limitation is $57,357,000. The increased benefits would increase the UAAL by $336,909,000.
For TRS, the Section 18-7A-28e retiree increase limitation is $97,125,000. The increased benefits would increase the UAAL by $710,597,000.
See the Pension Committee chairman for details.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2013
Increase/Decrease
(use"-") |
2014
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
215,252,000 |
215,252,000 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
215,252,000 |
215,252,000 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The bill provides a 5% benefit increase to all PERS and TRS retirees as of July 1, 2013, 2014 and 2015. Increased liabilities were valued applying actuarial software by CPRB. Amortization payments were funded over 6 years as provided in 2005 Pension Reform requirements for a qualifying improvement.
The increases provided in this bill exceed the benefit improvement limitations as specified in 2005 Pension Reform.
Memorandum
Provides a substantial retiree benefit increase of up to 15.76% for 2013 through 2015.
TRS eligibility has been treated as being equal to PERS eligibility. It is assumed the TRS provisions will be corrected during the legislative process.
Person submitting Fiscal Note: Harry W. Mandel, MAAA, MSPA, EA, Board Actuary
Email Address: harry.w.mandel@wv.gov