After the close of each fiscal year, the ASRS conducts a valuation of the various benefit plans that it manages to ensure they are fiscally sound. From the valuations, contribution rates are set for the next fiscal year. Despite a relatively slow economy and lower investment performance, the contribution rates for the pension plan (which includes the health insurance premium benefit) will remain unchanged for the next fiscal year, which begins July 1, 2017.
As such, the contribution rate for the pension plan paid by members and employers will remain at 11.34 percent. The rate for the long-term disability program will increase slightly, from 0.14 percent to 0.16 percent.
“We are pleased that our efforts to mitigate contribution rate volatility have come to fruition,” ASRS Director Paul Matson said, noting that the overall funded status of the ASRS plan also remained stable at 77.6 percent, up slightly from the previous year’s 77.5 percent.
It was also determined that there are no excess funds for an additional Permanent Benefit Increase to retired members for the next fiscal year. As outlined in state statute, increases can only be provided when there are excess returns. Given the market performance over the past 10-year period that the ASRS uses to recognize gains and losses, there are no excess earnings to fund an additional PBI at this time.