Washington County pension plans 87.1 percent funded
The Washington County retirement fund had total assets of $141,701,989 as of Aug. 29, and actuaries from the Hay Group of Philadelphia told the Washington County retirement board Thursday its funding ratio is 87.1 percent, which is considered “very good.”
“Anything over 80 percent is good, and it is consistent with a lot of the counties across the state of Pennsylvania,” said David Reichert, a principal of the Hay Group.
The county has consistently employed about 1,100 people, and salaries have increased between about 3.5 and 4 percent.
“You’ve managed your liability very well,” Reichert said.
Employees contribute 7 percent of their earnings to their pension plan, and the vast majority of county employees retire on $40,000 a year or less.
The pension fund is not required to be funded 100 percent because not all employees will be retiring at the same time,
Commission Vice Chairman Diana Irey Vaughan questioned Reichert about the life expectancy of participants, which affects the length of time they would collect pensions.
He noted most of the life expectancy improvement was among men, which led to a brief discussion about working women’s tasks at home compared with those of male counterparts.
State law requires the funding of public employees’ pensions with taxpayer dollars, so the county retirement board’s decisions affect those who pay county and state taxes. Unlike those who depend on individual retirement accounts, county employees have a defined-benefit plan.
“Funding (the pensions) is their responsibility,” also known as fiduciary duty, Reichert said of the retirement board.
Unlike Washington County, officials in some of the state’s counties declined to make what is known as the “annual required contribution,” and there’s no enforcement agency forcing counties to make up any shortfalls due to declines in pension investments.
The Hay Group will issue an estimate of taxpayer contributions to the pension fund in October, but the calculation isn’t finalized until after Dec. 31 of any given year.