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6:55 AM / Tuesday August 9, 2022

9 Jul 2021

Pension contribution rates rise for 94K school employees

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July 9, 2021 Category: Stateside Posted by:

ASSOCIATED PRESS 

HARRISBURG, Pa. — Pension contribution rates for tens of thousands of public school employees in Pennsylvania rose last Thursday, amid a federal investigation into some of the pension system’s actions and calls for firings.

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The increases took effect for about 94,000 school employees, all hired in 2011 or after. Most will see their contribution rate rise by 0.5% of their salary, while a smaller number of them will see their contribution rate rise by 0.75% of their salary. 

The board of the $64 billion Public School Employees’ Retirement System revealed in March that it was investigating a consultant’s calculation about the fund’s long-term investment performance that helps determine the balance of payments into the system by taxpayers and school employees.

The board voted nearly unanimously in April to increase the contribution rates, after it had originally certified them at lower rates in December.

The Associated Press has previously reported that subpoenas from federal investigators center, in part, on information about the risk-sharing calculations.

The Pennsylvania chapter of the American Federation of Teachers has called for the firing of PSERS executives and the resignation of board members who joined the board before this year.

Arthur Steinberg, AFT Pennsylvania’s president, which represents over 36,000 school employees across 64 local unions, said many of them will see a decrease in pay of as much as $30 to $50 a month.

“It was unacceptable when PSERS announced this change, and it is still unacceptable now. PSERS trustees and management must be compelled to answer for how their error in calculating the contribution rate came to pass,” Steinberg said. 

Meanwhile, six of 15 board members — including state Treasurer Stacy Garrity and two appointees of Gov. Tom Wolf — said last month that they had lost confidence in two top PSERS executives to manage and administer the retirement fund.

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