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Staff says three independent actuarial assessments align with consulting actuary; staff to recommend ADEC-style funding policy
Summary
PERS staff told trustees that three independent actuarial assessments produced results consistent with the consulting actuary — an actuarial determined contribution near 26% of payroll — and said they will likely recommend moving the board’s funding policy toward an ADEC (actuarial determined contribution) approach at a future meeting. Staff emphasized PERS’s stability while noting funding needs.
At the Oct. 23 meeting, staff summarized findings from three independent actuarial firms, saying the assessments largely corroborated the consulting actuary’s results and indicated an actuarial determined contribution (ADEC) of roughly 26% of payroll.
Staff described the reviews as confirmatory: the independent firms produced results similar to last year and to the consulting actuary’s recommendation. Staff said moving the board’s funding policy toward an ADEC framework would make funding targets clearer, while acknowledging implementation of any employer contribution increases is within the legislature’s authority under recent law changes. Staff said they will likely present recommended changes to the funding policy, updated scenarios and sensitivity runs (including different COLA/cola assumptions) at the November board meeting.
Board members asked clarifying questions about who paid for the additional actuarial work; staff said the system paid for the extra assessments out of its regular administrative budget (no separate appropriation). Trustees also asked for additional scenario runs (for example non-compounded vs. compounded COLA alternatives at 2% and 2.5%) and staff agreed to prepare those scenarios for the November meeting.
What happens next: staff intends to present proposed funding-policy language and scenario analyses at the next meeting; any change to funding policy or employer rates would still require legislative action where applicable.
Key numbers reported in the meeting include PERS assets (reported as $35.3 billion), an approximate ADEC near 26% of payroll, and the system’s monthly payroll and retiree counts discussed elsewhere in the meeting.
