Actuarial Fiscal Note

Date Requested:March 02, 2021
Time Requested:11:40 AM
Agency: Consolidated Public Retirement Board
CBD Number: Version: Bill Number: Resolution Number:
3113 Introduced HB2862
CBD Subject: Retirement

Retirement Systems Impacted by Legislation:

DSRS 2150

FUND(S):

Special Fund

Sources of Revenue:

Creates New Expense

Legislation creates:

DSRS



Actuarial Note Summary

Impact this measure will have on the liabilities and contributions associated with the retirement system(s).


    HB 2862 provides technical updates to the DSRS West Virginia Statute Chapter 7 Article 14D.
    
    The technical updates to the DSRS West Virginia Statute Chapter 7 Article 14D include the following:
    • Defining “Beneficiary” and updating the “Credited service” and “Final average salary” definitions in §7-14D-2.
    • Revise §7-14D-11(c) by removing the language “Notwithstanding any other provision of the plan, a member who is married on the annuity starting date will receive his or her retirement income payments in the form of a sixty-six and two-thirds percent joint and survivor annuity with his or her spouse unless prior to the annuity starting date the spouse waives the form of benefit.”
    • Adding section §7-14D-13(e) “In the event a member dies from any cause other than those specified in §7-14D-18 of this code and does not have ten or more years of credited service, the member’s accumulated contributions may be paid to a named beneficiary or beneficiaries. If no beneficiary is named, then the accumulated contributions shall be paid to the estate of the deceased member”
    • Revise §7-14D-19(a) by removing the language, “Where the member is receiving disability benefits under section fifteen of this article at the time of his or her death, the most recent monthly compensation determined under section seventeen of this article shall be substituted for the annual compensation in (i) of this section”
    • Update §7-14D-20(b) by clarifying the reference to the “Awards and benefits to surviving spouses” in sections §7-14D-18 and §7-14D-19.
    • Adding section §7-14D-32 “Severability”
    
    The technical updates to West Virginia Statute Chapter 7 Article 14D are not expected to change how the CPRB administers DSRS, therefore, we do not expect these updates to impact the unfunded actuarial accrued liability (UAAL) or the contribution requirements of DSRS.
    



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 2029 N/A


Explanation of above Actuarial estimates:


    The technical updates to West Virginia Statute Chapter 7 Article 14D are not expected to change how the CPRB administers DSRS, therefore, we do not expect these updates to impact the unfunded actuarial accrued liability (UAAL) or the contribution requirements of DSRS.

Analysis of Impact on Public Pension Policy:


    The technical updates to West Virginia Statute Chapter 7 Article 14D are not expected to change how the CPRB administers DSRS, therefore, we do not expect these updates to impact the unfunded actuarial accrued liability (UAAL) or the contribution requirements of DSRS.



Fiscal Note Summary


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


    The Deputy Sheriffs Retirement System is not a liability of the State, and as such the cost to the system due to the proposed legislation would not affect the State’s costs.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2021
Increase/Decrease
(use"-")
2022
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):


    The Deputy Sheriffs Retirement System is not a liability of the State, and as such the possible cost to the system due to the proposed legislation would not affect the State’s costs.
    



Memorandum


    This Actuarial/Fiscal Note is being submitted by the Consolidated Public Retirement Board. It has been reviewed by the CPRB Actuary. Both the Board and the CPRB Actuary are available upon request for questions.
    
    Kenneth Woodson Jr., the CPRB Board Actuary, is a Fellow of the Society of Actuaries and a Member of the American Academy of Actuaries. He meets the Qualification Standards of the American Academy of Actuaries to render the actuarial opinions contained in this Actuarial/Fiscal Note.
    



    Person submitting Fiscal Note: Kenneth M. Woodson Jr.
    Email Address: kenneth.m.woodson@wv.gov