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PERS staff outlines tier 5 proposal, ORP changes and Legislature’s $100M lottery proposal
Summary
Staff and outside counsel briefed board members on pending legislation: House Bill 1 (a proposed $100 million annual lottery contribution), an ORP closure proposal, Roth/QUADRO technical changes and a Tier 5 hybrid that would apply to new hires starting March 1, 2026.
PERS legislative staff and outside counsel briefed the board’s legislative committee on a package of bills affecting the state retirement system, including a proposal to create a new Tier 5 hybrid benefit for future hires, changes to the Optional Retirement Plan (ORP), and a House Bill 1 proposal to direct $100 million a year in lottery proceeds to PERS until the plan reaches 80 percent funded.
The committee heard details of the Tier 5 draft that passed the Senate: it would apply to employees hired on or after March 1, 2026; would be a DB‑plus‑DC hybrid with an approximate 1 percent DB multiplier and a DC portion; would keep a 9 percent employee contribution split as 4 percent to the DB and 5 percent to the DC account; and would eliminate several current features such as guaranteed COLAs on the DB portion, the PLSO (post‑retirement lump sum…
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