Meeting provides pension update

December 10, 2015

The Public Retirement Systems interim committee met two days this week to hear updates from each of the four state pension systems on topics including rates of return, investment portfolios, funded ratios of the systems, and contribution rates and benefits, and to determine whether any recommendations for legislative changes would be made.

Highlights from Wednesday included a presentation from the Municipal Fire and Police Retirement System of Iowa (MFPRSI) and the stakeholders including the cities and firefighters. City contribution rates have declined to 25.92 percent of covered wages for 2016 from a high of 30.41 percent in 2014. Cities currently contribute 27.77 percent of covered wages. Concerns remain for cities over lack of a state contribution to the system and over medical costs and workers compensation costs provided through the system, which are not tracked by the pension system. Employee groups are not asking for any changes to the system at this time.

The Iowa Public Employee Retirement System (IPERS) presented on Thursday. No recommendations were made for changes either by the system or by the Investment Board or the Benefits Advisory Committee (BAC), but the BAC said it will be studying the potential for a cost of living increase (COLA) for employee IPERS members. The IPERS system will also study the potential for bringing investment responsibilities “in-house” rather than paying private companies to manage all of the system’s funds.