Las Vegas Sun

October 24, 2014

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Retirement premiums going up for government workers

The estimated 100,000 public employees and the 186 state and local governments will each be paying slightly more next fiscal year to keep the Nevada's retirement system healthy.

The board of the state Public Employees' Retirement System adopted an evaluation report Wednesday that calls for a 1 percent increase in premiums for the workers and 1 percent hike for the governments in the employee-employer matching contribution system.

And rates in the separate system for police and firefighters will increase one-half of 1 percent each between the worker and for employer.

Dana Bilyeu, executive director of the system, says it will collect an extra $10 million from the workers and $10 million from the governments.

Market value of the regular system is at $20.4 billion and $5.5 billion for the police-firefighters plan, according to Brad Ramirez, consulting actuary for Segal Co.

The system collected $1.5 billion in premiums in the 2011-12 period and it spent $1.6 billion in benefits. But that $100 million difference is "not alarming" since it is a pay as you go system, said Ramirez, who expects the contributions to exceed benefits in the future.

There were fewer government workers and many employees suffered in pay reductions, resulting in the $100 million figure.

The board is required to adopt rates based on the valuation of the system.

Chris Collins, a board member representing the Las Vegas Police Protective Association, said the information shows the system is healthy.

Bilyeu said the system is 70 percent funded while some national reports say Nevada and other states are in "dire straits." She said the system will not be coming to the state's general fund to bail it out.

Active members in regular government employment total 86,719 as of last June 30 with an average salary $48,808, a decline of 0.9 percent from the previous year,

Police and firefighter membership in its system was 11,793 with an average salary $72,523 or a 1.9 percent decline, according to the Segal evaluation report.

There are 38,528 retired government workers drawing benefits with an average monthly check of $2,603. The Segal report said there were 5,484 retired police and firefighters with an average monthly stipend of $4,487.

Warren Wish, president of the Nevada State Education Association retirees, told the board that Gov. Brian Sandoval has hired the Arnold Foundation to do a study on the system. He said that company is a "hardly unbiased organization" and he urged the board to conduct an independent study.

That will be an item on the next meeting of the board. But Bilyeu said the system cannot spend the money held in trust for this purpose. And she said the Segal report shows the economic condition of the system.

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