2011 Retaining Effective Teachers Policy
The state should ensure that excessive resources are not committed to funding teachers' pension systems.
As of January 1, 2010, the most recent date for which an actuarial valuation is available, Wyoming's pension system for teachers is 87.5 percent funded and has an amortization period of over 30 years. This means that if the plan earns its assumed rate of return and maintains current contribution rates, it would take the state over 30 years to pay off its unfunded liabilities. While its funding ratio meets the recommended minimum standard, the state's system is not financially sustainable according to actuarial benchmarks.
Wyoming does not commit excessive resources toward its teachers' retirement system. The mandatory employee contribution rate to the defined benefit plan is 7 percent, and the current employer contribution rate is 7.12 percent. These rates are set by statute. Both of these rates are reasonable; however, they are close to excessive considering that teachers and local districts are also contributing to Social Security.
Wyoming Retirement System Comprehensive Annual Financial Report http://retirement.state.wy.us/publications/index.html http://legisweb.state.wy.us/statutes/statutes.aspx?file=titles/Title9/T9CH3AR4.htm
Ensure that the pension system is financially sustainable.
The state would be better off if its system had an amortization period of 30 years or less to allow more protection during financial downturns.
Wyoming recognized the factual accuracy of this analysis.