Agenda Item 5cFinance & Administration Committee
June 18, 2013Page 2 of 8
This action item is being presented as part of the regular and ongoing workload of theActuarial Office and supports Strategic Plan Goal A: Improve long-term pension andhealth benefit sustainability.
This agenda item is being presented in June, which is one month later than it wouldbe presented in a typical year. The implementation of AB340 and the first-time use of data from the my|CalPERS system resulted in some delays. In the future, weanticipate this agenda item will be presented in May.
ANALYSISState and Schools Employer Contribution Rates for 2013-14
The Actuarial Office has completed the calculation of the employer contribution ratesfor the State and Schools for the fiscal year 2013-14. The full actuarial report isexpected to be completed late this summer and will be provided to the Board andposted online when complete . The table below compares the fiscal year 2013-14 contribution rates and the dollaramounts these rates are anticipated to generate with the rates and contributions forthe current fiscal year 2012-13.
2012-13 Fiscal Year 2013-14 Fiscal Year ExpectedEmployer Contribution
ExpectedEmployer ContributionEmployer ContributionRate
State Miscellaneous Tier 1 $2,064,654,743 20.503% $2,093,047,896 21.121%State Miscellaneous Tier 2 72,880,957 20.457% 72,151,897 20.992%State Industrial 100,447,274 16.302% 90,690,285 15.682%State Safety 347,275,501 17.503% 326,678,917 17.205%State Peace Officers &Firefighters1,028,095,419 30.297% 954,994,296 30.495%California Highway Patrol 263,068,361 33.728% 267,523,309 34.616%
Subtotal State $3,876,422,255 $3,805,086,600
Schools 1,203,430,156 11.417% 1,171,945,558 11.442%
Total $5,079,852,411 $4,977,032,158
In 2012, the CalPERS Board adopted new economic assumptions that were used forthe first time in the June 30, 2011 valuation. In an effort to mitigate the impact thisassumption change had on employers’ budgets, the Board chose to phase-in theimpact of the assumption change over two years. Last year during the May meetingof the Pension and Health Benefits Committee, representatives from the Department
Without phase-in of the assumption change adopted by the Board in 2012.