TIGARD, Ore. (AP) — The board overseeing Oregon’s public-employee pension system is recommending changes that will result in smaller benefits for some longtime government employees and higher long-term costs for state and local governments.
Board members told actuaries Friday that they intend to lower the assumed investment earnings rate from 8 percent a year to 7.75 percent. The decision won’t be formally adopted until September and would be the first change in 24 years.
Lowering the assumed earnings rate means state and local governments have to contribute more to fund retirement benefits for their current and former employees. To mitigate the impact on government, the board also approved two accounting changes.
The higher costs aren’t expected to show up until 2017.
The board is trying to recover from substantial investment losses during the Great Recession.