CalPERS Needs Feedback on Proposed Amortization Changes
January 18, 2018
By participating in a CalPERS-issued online survey, CalPERS-member agencies have an opportunity to potentially impact the Board’s decision on an amortization proposal which could significantly affect employer contribution rates. The deadline to complete the survey is Thursday, January 24. As counties will recall, the impetus behind the survey came from several Board Members who specifically requested employer agency feedback before adopting any changes to the existing amortization policy.
In a webinar presentation held last week, CalPERS staff outlined their proposed changes to the current amortization schedule (a recording of the webinar and presentation slide deck will be posted on the CalPERS website soon). Most notably, the proposal seeks to prospectively shorten the amortization period on investment gains and losses from 30 years to 20 years. CalPERS staff is recommending the change to align the system with industry standards, reduce negative amortization, improve intergenerational equity, and enhance benefit security.
The Board is scheduled to act on the amortization proposal during the Finance and Administration Committee Meeting on Tuesday, February 13 in Sacramento. At the meeting, CalPERS staff will present the results from the survey and CSAC will be there to provide public comment. Individual agency employers are also encouraged to attend if available.