For Immediate Release
February 4, 2020
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Public School Employees' Retirement System
PSERS Executive Director Glen Grell Thanks Gov. Wolf for Supporting School Employees in His Proposed 2020-21 Budget
HARRISBURG -- Public School Employees' Retirement System Executive Director Glen Grell commended Gov. Tom Wolf for his proposed 2020-21 budget that would provide PSERS with the necessary funding to meet the pension obligations of nearly 500,000 current and retired public school employees.
Gov. Wolf's spending plan, released Tuesday, would provide PSERS with the Commonwealth's share ($2.75 billion) of the full actuarially required funding in the next fiscal year. About three quarters of the budgeted amount would be devoted to the System's unfunded liability, which was caused by many years of employer underfunding, enhanced benefits, and periodic investment losses.
PSERS does not receive a General Fund appropriation to cover the System's administrative expenses. Rather, the administrative costs are paid from the System's investment proceeds after receiving approval from Gov. Wolf and the General Assembly. PSERS' administrative budget is $52.3 million.
"I want to thank Governor Wolf for his continued commitment and support of PSERS and our members," Mr. Grell said in a statement. "Since taking office in 2015, Governor Wolf and legislators have committed to paying down the pension debt, and that makes a positive difference for PSERS and the dedicated public servants who depend on us to deliver their retirement benefits."
Full actuarial funding, plus solid investment returns, recently helped PSERS reduce its unfunded liability for the first time in a decade. The debt declined $800 million to $44.1 billion between FY2018 and FY 2019. At the same time, PSERS funded ratio saw its largest percentile increase (3.00%) to 58.1%.
About the Pennsylvania Public School Employees' Retirement System
PSERS, founded in 1917, began operations in 1919 to oversee a statewide defined benefit pension plan for public school employees. PSERS' role expanded upon the passage of Act 5 of 2017 to include oversight of two new hybrid options consisting of defined benefit and defined contribution (DC) components and a stand-alone DC plan. PSERS membership covers about 256,000 active and 237,000 retired school employees.