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State workers might have to pay more to retirement
Sep 17, 2013 - The Associated Press
CHEYENNE (AP) -- Concerned about the solvency of Wyoming's public employee pension fund, lawmakers are looking at requiring state workers to contribute more money to their retirement.
The Legislature's Joint Appropriations Committee has asked for a bill to be drafted that would hike both the state and employee pension contributions by 1 percentage point over two years. This would come on top of the phased-in contribution increases lawmakers approved this year.
Rep. Steve Harshman, R-Casper, who co-chairs the Joint Appropriations Committee, said the panel plans to discuss the issue further this fall.
But Harshman said something likely will have to be done to strengthen the Public Employee Pension Plan, which covers most state workers.
A recent state report found the plan risks being dangerously underfunded if changes are not made. It shows the state has funded 72.8 percent of the pension plan's costs. That means the unfunded portion is nearly $2.15 billion.
The U.S. Government Accountability Office reports that most experts consider a funding ratio of 80 percent or higher to be stable for government pension plans.
Ruth Ryerson, executive director of the Wyoming Retirement System, said projections show the unfunded liability will grow unless the state acts.
"You don't want to wait around until we have a problem like in Illinois," she said. Illinois has a pension shortfall of more than $100 billion.
Once the increase that was approved earlier this year is fully phased in, workers in the Public Employee Pension Plan will pay 1.93 percent of their monthly salary into the retirement fund. The state picks up the rest of the contributions.
Betty Jo Beardsley, executive director of the Wyoming Public Employees Association, said she would oppose an employee pension contribution hike if a salary increase does not come with it.
She said she will ask Gov. Matt Mead to increase salaries by at least 4 percent.
"As of right now, the association's priority is going to be to get raises for state employees, many of whom haven't gotten one since 2008," she said. "I've always said that if you are going to have employees take more ownership (of their benefits), the best way to do it is to give them a raise and take part of that to pay for increased health insurance or retirement costs."
The committee's next meeting is set for Oct. 28.