Actuarial Fiscal Note

Date Requested:February 22, 2017
Time Requested:12:59 PM
Agency: Consolidated Public Retirement Board
CBD Number: Version: Bill Number: Resolution Number:
2061 Introduced HB2649
CBD Subject: Retirement, State Personnel

Retirement Systems Impacted by Legislation:

PERS, TRS, TDC, SPTA, SPTB, JRS, DSRS, EMSRS, MPFRS

FUND(S):

PERS 2501, TRS 2600, TDC 2190, SPTA 2392, SPTB 2393, JRS 2140, DSRS 2150, EMSRS 2615, MPFRS 2390

Sources of Revenue:

Other Fund N/A

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).


    HB 2649 proposes to make changes to “Less Than Honorable Service” provisions that apply to all retirement plans administered by the CPRB. Namely, it would specify certain crimes (larceny, forgery of public record, perjury, false swearing, bribery, etc.) which would be considered to constitute “Less Than Honorable Service”. It also removes the restriction that a crime must not be a misdemeanor to constitute “Less Than Honorable Service”.
    Passage of the bill would result in no cost impact on the plans’ Unfunded Actuarial Accrued Liabilities or Normal Cost, and would result in no change to the plans’ contribution requirements.
    



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 N/A


Explanation of above estimates:


    There is no actuarial assumption concerning “Less Than Honorable Service” performed in any of the CPRB-administered plans. The changes proposed by the bill would not result in any measurable cost impact.

Analysis of Impact on Public Pension Policy:


    Current code provisions require that a crime must be a felony in order to be cause for disqualification under less than honorable service provisions. This bill would allow disqualification based on conviction of certain misdemeanors. Under current statute, prosecuting attorneys in each county would be required to report such convictions to the Board, and this bill makes no change to that requirement.



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


    Passage of the bill would result in no cost impact on the plans’ Unfunded Actuarial Accrued Liabilities or Normal Cost, and would result in no change to the plans’ contribution requirements.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2017
Increase/Decrease
(use"-")
2018
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 estimates (including long-range effect):


    Passage of the bill would result in no cost impact on the plans’ Unfunded Actuarial Accrued Liabilities or Normal Cost, and would result in no change to the plans’ contribution requirements.



Memorandum


    Current code provisions require that a crime must be a felony in order to be cause for disqualification under less than honorable service provisions. This bill would allow disqualification based on conviction of certain misdemeanors. Under current statute, prosecuting attorneys in each county would be required to report such convictions to the Board, and this bill makes no change to that requirement.



    Person submitting Fiscal Note: Melody Bailey, Actuarial Analyst, WVCPRB
    Email Address: melody.j.bailey@wv.gov