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URS reports strong investment returns but rising payrolls push tier‑2 contribution rates up
Summary
URS reported 2024 fund values, strong returns and a mid‑nineties funded ratio but said unusually high payroll growth in recent years increased liabilities for the newer tier‑2 plan, prompting a 0.49 percentage‑point increase to an 11.38% tier‑2 contribution rate for fiscal 2026–27.
Utah Retirement Systems officials told the committee the pension fund posted positive investment returns and a funded ratio in the mid‑90s, but salary growth since 2022 raised liabilities for the newer tier‑2 plan and led to a modest contribution rate increase targeted at stabilizing funding over the long term.
The update matters because contribution rate changes affect employee paychecks and employer payroll costs across state, education and local government budgets; the committee was briefed on the board’s contribution‑rate management approach and the rationale for both increases and reductions across risk pools.
Dan Anderson, URS executive director, said the defined‑benefit fund had about $48 billion as of Dec. 31, 2024, and a year‑to‑date…
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