With all the discussion nationwide about public pensions has the county considered changing our system so that there is a ceiling to what you can earn in retirement, a cap, say $80,000 and then index that number to inflation or the CPI or wage index. It seems like a simply solution that will maintain our pension system but keep costs down, a win-win.
Fairfax County recently contracted with AON Hewitt and the PRM Consulting Group for a comprehensive review of our three retirement systems: the Employees’ Retirement System (ERS), the Police Officers Retirement System (PORS) and the Uniformed Retirement System (URS). The study findings concluded that, given the important role of total compensation in attracting and retaining talent in a competitive labor market, the basic structure of the County’s systems continues to make sense. The study did, however, recommend changes for newly-hired employees, all of which were adopted by the Board of Supervisors on September 11, 2012. Specifically:
• The minimum retirement age for members of ERS was raised from 50 to 55.
• The total of age plus eligibility service required for normal retirement was raised from 80 to 85 for members of ERS.
• For members of all three systems, the use of unused sick leave for determining retirement eligibility and annuity calculations was capped at 2,080 hours.
• The pre-Social Security supplement was eliminated from Deferred Retirement Option Program (DROP) accounts for members of ERS and URS.
Annual savings from these changes are projected to steadily increase from $602,000 in FY 2015 to $11,538,000 in FY 2027. Beyond FY 2027, the savings will continue to grow.