About Contribution Rates

A funded ratio is a measure of assets to liabilities. A ratio of 100 percent indicates employer contributions will approximate the expected long-term rates. If a funded ratio is above 100 percent, employer contributions will generally be less than the expected long-term rates while employer contributions will generally be more that the expected long-term rates if a funded ratio is below 100 percent. According to the Public Fund Survey of the National Association of State Retirement Administrators, most public plans are funded at 87 percent.

As of April 1, 2010, the funded ratio of the Employees’ Retirement System (ERS) was 93.9 percent, while the funded ratio of the Police and Fire Retirement System (PFRS) was 96.7 percent. As a result, the average employer contribution rates for 2013 will be 18.9 percent in ERS, and 25.8 percent in PFRS.