OregonLive reports PERS rates for state agencies will more than double in 2011.
The actuary for Oregon’s Public Employee Retirement System confirmed Friday what is already a common-knowledge piece of the state’s looming budget shortfall: the cost of funding PERS will increase sharply in 2011.
Mercer Inc. told the PERS board Friday that systemwide, the payroll rates paid by cities, counties, school districts and state agencies to cover their employees’ pension and health care benefits will more than double in 2011, from their current level 5.2 per cent of payroll to 10.8 per cent of payroll.
As of Dec 31, the retirement system had 76 cents in assets for every $1 in liabilities, excluding prepaid contributions. The system’s investments declined about 1 per cent year through May 31, Mercer said. If they finish the year at this level, the system’s overall funded status, excluding prepaid contributions, will decline to about 70 per cent, Mercer said.
Actual pension rates vary by individual employer. Employers will learn the exact rate they’ll start paying in 2011 in September.
If we finish the year her the system will only be 70% funded. Pray tell what happens if the stock market finished the year down a modest 15% and is flat next year?
Notice the article says “Actual pension rates vary by individual employer”. Although the rates will vary, it is not “employers” who pick up the tab. Rather it is taxpayers who have to pay taxes to pick up the tab.
If articles like the one quoted explained things properly, there would be much more needed outrage.
The system is broke and the only way to fix it is to get rid of it. Defined benefit plans at taxpayer expense have to go.
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