PA Pension Overview. PSFC Meeting 2.7.13. Factors contributing to PSERS debt. 2 % 2%. 13%. 43%. Act 120 of 2010. CHANGES TO FUNDING: Required employer to pay the set rate Eliminated 2012 rate spike Committed employers to stepped up contributions subject to rate collars
CHANGES TO FUNDING:
CHANGES IN BENEFITS (New Hires Only):
non-school service (except for military service)
Employer Normal Cost Rate
Employer Normal Cost Rate (Class T-E)
Normal Cost Rate 10.50%
Member Rate (7.50)
Employer Normal 2.20%
Normal Cost Rate 16.06%
Member Rate (av.) (7.40)
Employer Normal 8.66%
What is Normal Cost?
The cost of benefits earned by school employees during the school year.
Along with projected investment earnings (currently 7.5%) this amount should fully fund the retirement benefits for a member by the time they reach normal retirement age.
Unfunded Liability Rate