A new ranking shows a wide range of performance in the nation's public retirement plans.
To determine which public retirement plans are standout performers at achieving that benchmark among a crowded field of pension, defined contribution, guaranteed return and hybrid plans, the Equable Institute assessed the quality of benefits being offered to U.S. public sector workers.
The institute ranked 335 public retirement plans nationwide across 11 metrics. The Long Island City, N.Y.-based nonprofit organization looked at the adequacy of retirement income, eligibility requirements, inflation-adjusted income, rules related to refunding member contributions, and interest credits provided for member contributions being withdrawn.
Here, in ascending order, are the plans deemed the best by the Equable Institute:
10. Washington LEOFF Plan 2
The Washington LEOFF Plan 2 is a traditional pension plan that covers state police and firefighters hired on or after October 1, 1977. Members contribute 8.5% of payroll to their retirement plan, which reportedly paid 9% in fees on its total 2019 investment earnings of $1.07 billion.
9. South Dakota RS Generational Plan Public Safety
The South Dakota RS Generational Plan Public Safety is a hybrid plan that covers state general employees hired on or before July 1, 2017. Members contribute 6% of payroll to their retirement plan, which reportedly paid 9% in fees on its total 2019 investment earnings of $599.55 million.
8. Oregon OPSRP Police & Fire
The Oregon OPSRP Police & Fire is a hybrid plan that covers state and local police and firefighters hired on or after August 28, 2003. Members contribute 5.3% of payroll to their retirement plan, which reportedly paid 19% in fees on its total 2019 investment earnings of $4.32 billion.
7. Michigan SERS DC Plan
The Michigan SERS DC Plan is a defined contribution plan that covers state general employees hired on or after April 1,1997. Members contribute 7% of payroll to their retirement plan. Investment management and fees, and sustainability are not applicable to this type of plan, Equable says.
6. Montana PERS DC Plan
The Montana PERS DC Plan is a defined contribution plan that covers state and local general employees hired on or after July 1, 2000. Members contribute 7.9% of payroll to their retirement plan. Investment management and fees, and sustainability are not applicable to this type of plan, Equable says.
5. Tennessee TRP Hybrid Plan
The Tennessee TRP Hybrid Plan is a hybrid plan that covers public school teachers hired on or after July 1, 2014. Members contribute 7% of payroll to their retirement plan, which reportedly paid 2% in fees on its total 2019 investment earnings of $12.15 million.
3. Texas CDRS Police & Fire High Credit (Tied)
The Texas CDRS Police & Fire High Credit is a guaranteed return plan that covers local police and firefighters hired after 1967. Members contribute 7% of payroll to their retirement plan, which reportedly paid 1% in fees on its total 2019 investment earnings of $4.86 billion.
3. Texas CDRS General High Credit (Tied)
The Texas CDRS General High Credit is a guaranteed return plan that covers local general employees hired after 1967. Members contribute 7% of payroll to their retirement plan, which reportedly paid 1% in fees on its total 2019 investment earnings of $4.86 billion.
2. South Carolina RS DC Plan Teachers
The South Carolina RS DC Plan Teachers is a defined contribution plan that covers public school teachers hired on or after July 1, 2012. Members contribute 9% of payroll to their retirement plan. Investment management and fees, and sustainability are not applicable to this type of plan, Equable says.
1. South Carolina RS DC Plan General
The South Carolina RS DC Plan General is a defined contribution plan that covers state and local general employees hired on or after July 1, 2012. Members contribute 9% of payroll to their retirement plan. Investment management and fees, and sustainability are not applicable to this type of plan,
The full report can be viewed here.
