Actuarial Fiscal Note
Date Requested:January 17, 2018 Time Requested:11:47 AM |
Agency: |
Consolidated Public Retirement Board |
CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
1864 |
Comm. Sub. |
HB3095 |
|
CBD Subject: |
Education (Higher) |
---|
|
Retirement Systems Impacted by Legislation:
TRS
FUND(S):
TRS 2600
Sources of Revenue:
General Fund
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).
The House Education Committee Substitute (and the bill as introduced) violates §18-7A-28e, known as “2005 Pension Reform”, which prohibits increases to benefits for active members of TRS.
This Com Sub provides that retirees of TRS shall be permitted to return to work in a full-time capacity for any Institute of Higher Education (including HEPC and CCTC) without affecting his or her retirement benefit. The bill requires a 6-month waiting period between commencing the retirement annuity and returning to employment.
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 |
$999,999,999.00 |
$999,999,999.00 |
99.99 % |
Normal Cost of System |
N/A |
$999,999,999.00 |
99.99 % |
Past Service Liabilities |
$999,999,999.00 |
$999,999,999.00 |
99.99 % |
Fiscal Year Past Service Amortization Period Ends |
N/A |
999,999,999 |
N/A |
Explanation of above Actuarial estimates:
The House Education Committee Substitute (and the bill as introduced) violates §18-7A-28e, known as “2005 Pension Reform”, which prohibits increases to benefits for active members of TRS. Current retirees of TRS are prohibited from working more than 7 hours at any Institute of Higher Education without a reduction in their monthly annuity. Thus, allowing retirees to return to work with no limit on the number of hours allowed is providing an additional benefit that is not currently available.
Analysis of Impact on Public Pension Policy:
The House Education Committee Substitute (and the bill as introduced) violates §18-7A-28e, known as “2005 Pension Reform”, which prohibits increases to benefits for active members of TRS. Current retirees of TRS are prohibited from working more than 7 hours at any Institute of Higher Education without a reduction in their monthly annuity. Thus, allowing retirees to return to work with no limit on the number of hours allowed is providing an additional benefit that is not currently available.
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The House Education Committee Substitute (and the bill as introduced) violates §18-7A-28e, known as “2005 Pension Reform”, which prohibits increases to benefits for active members of TRS. Current retirees of TRS are prohibited from working more than 7 hours at any Institute of Higher Education without a reduction in their monthly annuity. Thus, allowing retirees to return to work with no limit on the number of hours allowed is providing an additional benefit that is not currently available.
Fiscal Note Detail
Effect of Proposal |
Fiscal Year |
2018 Increase/Decrease (use"-") |
2019 Increase/Decrease (use"-") |
Fiscal Year (Upon Full Implementation) |
1. Estmated Total Cost |
999,999,999 |
999,999,999 |
999,999,999 |
Personal Services |
999,999,999 |
999,999,999 |
999,999,999 |
Current Expenses |
999,999,999 |
999,999,999 |
999,999,999 |
Repairs and Alterations |
999,999,999 |
999,999,999 |
999,999,999 |
Assets |
999,999,999 |
999,999,999 |
999,999,999 |
Other |
999,999,999 |
999,999,999 |
999,999,999 |
2. Estimated Total Revenues |
999,999,999 |
999,999,999 |
999,999,999 |
Explanation of above Fiscal Note estimates (include possible long-range effect):
The House Education Committee Substitute (and the bill as introduced) violates §18-7A-28e, known as “2005 Pension Reform”, which prohibits increases to benefits for active members of TRS. Current retirees of TRS are prohibited from working more than 7 hours at any Institute of Higher Education without a reduction in their monthly annuity. Thus, allowing retirees to return to work with no limit on the number of hours allowed is providing an additional benefit that is not currently available.
Memorandum
The House Education Committee Substitute (and the bill as introduced) violates §18-7A-28e, known as “2005 Pension Reform”, which prohibits increases to benefits for active members of TRS. Current retirees of TRS are prohibited from working more than 7 hours at any Institute of Higher Education without a reduction in their monthly annuity. Thus, allowing retirees to return to work with no limit on the number of hours allowed is providing an additional benefit that is not currently available.
Person submitting Fiscal Note: Melody Bailey, Actuarial Analyst, WVCPRB
Email Address: melody.j.bailey@wv.gov