County retirement staff report 2025 legacy pension contribution estimates; actuary recalculates slightly lower amount

Milwaukee County retirement staff presented an informational report Tuesday on the county's legacy pension contributions for 2025, telling the Committee on Personnel that actuarial recalculation reduced the county's estimated required payment for the county Employees' Retirement System (ERS) and the seasonal OBRA pension.

The retirement plan services director (name not specified on the record) told supervisors that the 2025 contribution estimate prepared on Jan. 1, 2024, had originally totaled $85,900,000 — $85,500,000 for ERS and $420,000 for the OBRA seasonal pension — and that, as of the report submission date, approximately $32,900,000 had been contributed to ERS and the full $420,000 had been contributed to OBRA.

The director said an updated actuarial valuation incorporating final 2024 investment performance and corrected participant data recalculated the required 2025 contributions to $83,900,000 for ERS and $373,000 for OBRA, a net decrease driven mainly by positive investment returns and data cleanup.

The presenter noted that Milwaukee County became an employer covered by the Wisconsin Retirement System (WRS) for employees hired on or after Jan. 1, 2025; the informational report covers only the legacy ERS and OBRA plans and therefore does not include WRS details. Tony Mays, director of total rewards in the Department of Human Resources, said the county had about 485 employees now participating in WRS.

Committee members asked about legacy benefit provisions known as 'backdrop' lump‑sum payments. The retirement staff said the actuarial valuation already accounts for backdrop costs and that a 2013 freeze reduced the value of some backdrop payments. Staff said actuarial assumptions about how many eligible employees will elect the backdrop have dropped from 75% to about 50%, reducing projected costs. Officials also said only a small number — “maybe a dozen or so” — of employees remain who are exempt from the 2013 freeze and that seven‑figure lump sums are expected to be rare.

Committee members also asked whether employer pension contributions were being funded from the county's new sales tax revenue; the retirement director said employer contributions may be paid from the new sales tax revenue and that the payments were, in fact, being paid from those receipts.

Ending: The item was informational and no committee vote was required. Supervisors requested follow‑up tallies of employees remaining with legacy backdrop eligibility and more detailed reports as needed for budget discussions.