Employer Update

Later this month, VRS will email actuarial valuation reports, prepared as of June 30, 2021, to all political subdivision employers. A memo accompanying each employer’s report will include the retirement contribution rate along with rates for group life insurance and the health insurance credit, if applicable. The new rates are effective for fiscal years 2023 and 2024, beginning July 1, 2022, and ending June 30, 2024. View the board-certified rates for group life insurance and the Virginia Local Disability Program (VLDP).

Political subdivision plans are not in a cost-sharing pool, so the contribution rates are calculated based on the assets and liabilities of each individual participating employer. While rate changes for political subdivisions reflect plan demographics and individual plan experience of each employer, most will have a change in contribution rate of less than 1% for fiscal years 2023 and 2024.

In aggregate, the employer contribution rates for political subdivision pension plans will increase slightly from an average of 8.33% during the last rate setting to 8.79% as of the current valuation. Much of the increase stems from changes in actuarial assumptions for the plans, such as members living longer.