Actuarially determined contributions would reverse Montana’s pension debt trends

In Politics by Michael Rae

Pension systems like the Montana Public Employee Retirement System Define Benefit (PERS-DB) plan rely on contributions from government workers and their employers—as well as compounding investment returns—to save the necessary amounts needed to pay constitutionally protected retirement benefits.

Despite periodically increasing rates, annual contributions have routinely fallen short of what’s needed to pay off more than $2 billion in unfunded pension liabilities. Moving from the current statutorily-fixed contribution rate to an employer contribution that is actuarially determined (ADEC) annually is an important step towards securing the long-term financial future of one of Montana’s largest public pension systems.

Actuarially determined contributions would