Employer Contribution Rates Announced
for Fiscal Year 2013-14
New York State Comptroller Thomas P. DiNapoli today announced the Fiscal Year 2013-14 employer contribution rates for the New York State and Local Retirement System.
For Fiscal Year 2013-14, the average contribution rate for the Employee Retirement System (ERS) will increase from 18.9 percent of salaries to 20.9 percent. The average contribution rate for the Police and Fire Retirement System (PFRS) will increase from 25.8 percent to 28.9 percent. Rates for specific plans and tiers are available under "Contribution Rates and Related Information" on the Comptroller’s website at http://osc.state.ny.us/retire/employers/index.htm.
“The Common Retirement Fund has experienced solid gains the last three years and continues to rebuild from the substantial financial market loss of 2008-2009,” DiNapoli said. “The rise in the employer contribution rate has slowed this year, but there will continue to be upward pressure on rates through Fiscal Year 2014-2015 reflecting the impact of that loss. New York continues to responsibly manage its pension system and our funded status remains among the highest in the country. It isn’t easy in these difficult economic times, but fulfilling our obligations has meant that New York has not had to play catch up like other states.”
Last year, in an effort to assist localities in planning their budgets, DiNapoli directed the Retirement System to give employers access to a full projection of their annual pension bill by September 1, six weeks earlier than in previous years. Employers use this projection for preparation of budgets and calculation of tax levies subject to the property tax cap effective for fiscal years that begin in 2013.
Projections of required contributions will vary by employer depending on factors such as retirement plans, salaries and the distribution of their employees among the six retirement tiers. The employer contribution rates announced today will apply to each employer’s salary base during the period of April 1, 2013 through March 31, 2014. Payments based on those rates are due by February 1, 2014, but may be pre-paid on December 15, 2013.
The property tax cap generally limits the amount a government entity can increase its annual tax levy to two percent or the rate of inflation, whichever is less. The cost of pensions above a change in the average contribution rate by more than two percentage points is excluded from the tax cap.
Since the ERS rate increase will be 2 percentage points higher than the previous year, no portion of an employer’s ERS contribution will be excludable from the tax cap. Since the PFRS rate increase is 3.1 percentage points higher than the previous year, the portion of the PFRS contribution equal to 1.1 percent of salaries will be excludable from the tax cap.
DiNapoli also certified the employer contribution rates calculated by the Retirement System’s actuary based on actuarial assumptions.
A copy of the actuary’s report can be found here: http://www.osc.state.ny.us/retire/publications/index.php.