West Virginia achieves early full funding for public employees retirement system by 2024

The Senate Pensions Committee of the West Virginia Legislature convened on February 17, 2025, to discuss the status and management of the state's various retirement plans. The meeting highlighted significant developments in the state's pension systems, particularly the Public Employees Retirement System (PERS) and the Teachers Defined Benefit Plan.

The committee began by outlining the current administration of ten distinct retirement plans, emphasizing the separation of provisions for each. The two largest plans, PERS and the Teachers Defined Benefit Plan, were noted for their substantial membership and funding status. The committee reported that PERS has achieved a remarkable milestone, becoming fully funded at 101.9%, ten years ahead of schedule. This achievement reflects the state's commitment to maintaining robust pension systems, positioning West Virginia as a leader in public pensions nationally.

The discussion also covered the transition to Tier 2 employees, who contribute a higher percentage of their pay towards retirement compared to Tier 1 employees. As of now, there are more Tier 2 employees than Tier 1, a significant shift since the implementation of Tier 2 in 2015. The committee anticipates that this transition will save the state approximately $55 million once fully realized.

Other plans discussed included the State Police Plan B, which is currently 90% funded, and the Judges Retirement System, which is notably overfunded at 244%. The committee explained that the judges' system benefits from consistent over-contributions, leading to its exceptional funding status.

The Emergency Medical Services (EMS) Retirement System was also highlighted, noting a recent increase in membership due to legislative changes allowing 911 personnel to transfer from PERS. This plan is currently funded at 89.5%. Conversely, the Natural Resources Police Officer Retirement System remains the least funded at 78.3%, primarily due to a previous cap on employer contributions, which has since been lifted.

The meeting concluded with a review of trends in funding across the plans, showcasing improvements over the past four years. The committee emphasized the importance of these retirement systems in providing financial security for over 50,000 West Virginians, including 69,000 retirees. The discussions underscored the state's ongoing efforts to ensure the sustainability and reliability of its pension systems for current and future beneficiaries.