- Report Published -
|Optional Retirement Plan for Higher Education, Review of Contribution Rates - December 11, 2008|
|Virginia Retirement System|
|§ 51.1-126 (F.2.)|
|The Board of Trustees of the Virginia Retirement System (VRS) is required by Section 51.1-126 of the Code of Virginia to review the contribution rates for the Optional Retirement Plan for Higher Education (ORPHE) at least once every six years. In order to facilitate the review, VRS staff collected data from the national peer institutions identified by the State Council of Higher Education for Virginia. The employer contribution data for each of the peer institutions was collected to determine the salary peer group mean contribution rate for the fiscal year ending 2007. In addition, the data was reviewed by the VRS actuary, Wachovia Retirement Services, and contribution rates were compared to VRS benefits at retirement using various scenarios and assumptions.|
The results of the analysis determined that the current ORPHE contribution rate provides benefits comparable to VRS at a broad spectrum of retirement age and service combinations. Additionally, the current 10.4 percent contribution rate was found to be competitive with the peer group mean. At this time, a revision by the Commonwealth to the 10.4 percent contribution rate is not recommended.