Actuarial Fiscal Note
Date Requested:March 02, 2021 Time Requested:11:38 AM |
Agency: |
Consolidated Public Retirement Board |
CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
3114 |
Introduced |
HB2854 |
|
CBD Subject: |
Retirement |
---|
|
Retirement Systems Impacted by Legislation:
MPFRS 2390
FUND(S):
Special Fund
Sources of Revenue:
Creates New Expense
Legislation creates:
MPFRS
Actuarial Note Summary
Impact this measure will have on the liabilities and contributions associated with the retirement system(s).
HB 2854 provides technical updates to the MPFRS West Virginia Statute Chapter 8 Article 22A.
The technical updates to the MPFRS West Virginia Statute Chapter 8 Article 22A include the following:
• Defining “Beneficiary” and minor updates to the definition of “Hour of service” and “Retirement income payments” in §8-22A-2.
• Revise §8-22A-14(b) by removing the language “Late retirement. -- A member whose annuity starting date is later than the date the member attains normal retirement age shall receive retirement income payments in the normal form without adjustment for age at commencement, which is the benefit to which he or she is entitled according to his or her accrued benefit based on his or her final average salary and credited service at the time of his or her actual retirement and following the completion of an application for retirement as required by the board.”
• Revise §8-22A-14(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 §8-22A-16(d) “If a member dies from any cause other than those specified in §8-22A-20 of this code and does not have 10 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.”
• Adding section §8-22A-17(d) and §8-22A-18(d) “The disability benefit payments will begin the first day of the month following termination of employment and receipt of the disability retirement application by the Consolidated Public Retirement Board.
• Update §8-22A-22(b) by clarifying the reference to the “Awards and benefits to surviving spouses” in sections §8-22A-20 and §8-22A-21.
• Adding section §8-22A-34 “The annuity of any member who retires under the provisions of this article and who resumes service in covered employment shall be suspended while the member continues in covered employment. The monthly annuity payment for the month in which the service resumes shall be pro-rated to the date of commencement of service, and the member shall again become a contributing member during resumption of service. At the conclusion of resumed service in covered employment, the member shall have his or her annuity recalculated to take into account the entirety of service in covered employment.”
• Adding section §8-22A-35 “Severability”.
The technical updates to West Virginia Statute Chapter 8 Article 22A are not expected to change how the CPRB administers MPFRS, therefore, we do not expect these updates to impact the unfunded actuarial accrued liability (UAAL) or the contribution requirements of MPFRS.
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:
The technical updates to West Virginia Statute Chapter 8 Article 22A are not expected to change how the CPRB administers MPFRS, therefore, we do not expect these updates to impact the unfunded actuarial accrued liability (UAAL) or the contribution requirements of MPFRS.
Analysis of Impact on Public Pension Policy:
The technical updates to West Virginia Statute Chapter 8 Article 22A are not expected to change how the CPRB administers MPFRS, therefore, we do not expect these updates to impact the unfunded actuarial accrued liability (UAAL) or the contribution requirements of MPFRS.
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The Municipal Police Officers and Firefighters 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 Municipal Police Officers and Firefighters 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.
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