Actuary: ESSB 5357 raises investment assumption to 7.25%; committee requests preliminary funding analysis

At a meeting of the Select Committee on Pension Policy executive committee, Michael Harbor, actuary for the Office of the State Actuary, told members that ESSB 5357 increased the statutorily set investment-rate-of-return assumption from 7 percent to 7.25 percent and included changes to unfunded actuarial liability (UAL) contribution schedules.

The change to the long‑term investment assumption and other provisions in ESSB 5357 mean updated contribution projections and an actuarial evaluation will follow later this fall, Harbor said. "Specifically I wanted to talk about the statutorily set investment rate of return that was increased as part of that bill from 7% to 7.25%," he said.

Why it matters: lawmakers said the combination of a higher return assumption and a four‑year suspension of UAL contributions will materially affect contribution rates and funded status projections. Senator Conway pressed for clarity on whether a four‑year suspension would raise rates later or…