Portland Business Journal
By Christopher Bjorke
Oregon Gov. Kate Brown signed a bill to reduce costs public employers pay into the state Public Employees Retirement System Tuesday.
“The Governor expected significant action to stabilize PERS rates this session under a model of shared responsibility, and with this legislation, PERS rates will be reduced through contributions from employers, the state general fund, the lottery and public employees,” Brown’s Deputy Communications Director Kate Kondayen said in an email Wednesday. “Going forward, Governor Brown will not look to public employees for further contributions. She will continue working to further decrease the unfunded actuarial liability via other sources.”
Senate Bill 1049 makes a number of changes to the state’s troubled PERS, which has an unfunded obligation of approximately $27 billion, but it mainly reduces employers’ costs by extending the period over which its debt is repaid. It also dedicates lottery revenue from sports betting to PERS and shifts some contributions by employees from 401(k)-style accounts toward paying for benefits.
That last change has drawn opposition to the measure from teachers organizations and other public employee representatives, who have threatened a legal challenge.
Brown has proposed shifting $250 million of the state’s expected $1.4 billion kicker tax rebate toward PERS and rolled out a more ambitious PERS fix in April that included taking $500 million from the state-run workers compensation insurance company to pay for retirement obligations.
Brown signed the PERS bill without fanfare, and did not mention it on the Governor’s Office website or on social media.