Working group asks actuary for scenarios after cost study shows large funding gap

Chair called the Probation Officers and 911 Telecommunicators Pension Plan group to order and framed the session as targeted work to meet a legislative session‑law requirement. Staff and the actuary reviewed a baseline GRS study and participants assessed what additional information they needed to make policy recommendations.

Doug, who walked the group through the GRS baseline, said the study modeled unreduced benefits at age 60, a 2.2% multiplier, and a post‑retirement adjustment equal to 100% of CPI with a 1% minimum and a 2.5% cap; the baseline did not include past‑service credit. He told the group the study’s starting normal cost was roughly 19.08% and noted that current combined employee and employer contributions are roughly 6.5%–7.5%, producing a wide initial gap that will vary over time as demographics change.

Employee representatives said they were not prepared to name a firm employee contribution percentage without more analysis and member education. One employee representative said the group had previously proposed a fully employee‑funded plan and that proposal had been rejected by the legislature as inequitable; the representative said, without additional context, “we’re kind of at a loss” to pick a new number. Jim Mortonson, speaking online, said educating members about tradeoffs would be “difficult at best” and urged using a contribution split that keeps employer involvement substantial.

Employer representatives, citing rising property tax levies and agency budget pressures, warned that increasing employer contributions materially would likely force program or staff cuts. An employer participant said local governments are already facing sustained cost pressures and asked that any plan be structurally sound and, if possible, not dependent on a direct state appropriation for basic normal cost.

Participants focused on levers that can materially change cost: the multiplier, COLA formulation and cap, vesting rules and the assumed normal retirement age. MSRS staff expressed discomfort with a 2.5% COLA, preferring a lower fixed COLA (1.75% was cited as more consistent with MSRS practice). Several speakers suggested the actuary model alternative scenarios — for example, 1.9% vs. 2.2% multipliers, different COLA rules, and a retirement age of 61 — so stakeholders could see which combinations approach a desired contribution level (one frequently cited target in discussion was roughly 14% on a particular framing of the numbers).

Because the group expected limited opportunities to return to the actuary, the chair directed staff to compile a menu of options and asked Doug and Amy to run a set of alternative scenarios for the next meeting. The group agreed that employee subcommittees could meet with staff to develop parameters and questions to bring to the actuary. No formal vote was taken; the group reached consensus to proceed by developing scenarios and reconvening on Oct. 2.

What happens next: staff will prepare a menu of non‑age actuarial variations (different multipliers, COLA formulas, vesting alternatives) and ask the actuary to run targeted scenarios, then reconvene in October when stakeholders will consider those numbers and decide whether to request additional or age‑based actuarial runs.