The state should ensure that excessive resources are not committed to funding teachers' pension systems.
As of October 1, 2010, the most recent date for which an actuarial valuation is available, the District of Columbia's teacher pension system is 118.27 percent funded and has an amortization period of zero. This means that the District does not currently have any unfunded liabilities to pay off. Both levels are better than regulatory recommendations, and the District's system is financially sustainable according to actuarial benchmarks.
The District does not commit excessive resources toward its teachers' retirement system. The mandatory employee contribution rate to the defined benefit plan is 8 percent, and the current employer contribution rate is zero. While both of these rates are reasonable, the employer rate is extremely low relative to what other states are contributing to their pension plans and Social Security. The District did make an annual lump sum payment of $2,982,835 to correct for member contribution shortfalls, and it has contributed as a percentage of payroll in previous years when determined necessary by actuarial valuations.
This District of Columbia Retirement Board, Actuarial Valuations as of October 1, 2010 http://dcrb.dc.gov/dcrb/lib/dcrb/valuation_report_as_of_october_1_2010.pdf
Contribute meaningfully to teachers' pension plans.
The District is commended for providing a financially sustainable system without committing excessive resources. However, the District should share part of the burden of funding the system by contributing along with teachers.
The District of Columbia Retirement Board did not respond to repeated requests to review NCTQ's analyses related to teacher pensions.