Public Comment, Joint Senate Finance and Assembly Ways & Means Committees, 2/13/2023

by Kent Ervin, NFA State President

The Nevada Faculty Alliance is the independent statewide association of professional employees at Nevada’s public colleges and universities. We work to empower our members to be fully engaged in our mission to help students succeed.

All of our classified colleagues at NSHE and about 15% of faculty are members of PERS. Faculty on NSHE’s retirement plan alternative receive the same contribution amounts as PERS per statute. The retirement plan is essential for recruiting and retaining state employees.

Nevada PERS has one of the strongest investment programs in the country.  Using a disciplined approach with low-cost investments and a lean investment staff, PERS has exceeded its investment goals and market benchmarks over the long term.  

Nevada PERS’s unfunded liability percentage is about in the middle among the 50 states. In 2021, PERS’s actuaries took a deep dive into the assumptions and changed them to be more fiscally conservative. That was the responsible thing to do but it is the primary reason that the PERS contribution rate is going up next year.  This will put PERS on a firmer footing over the next decades.  But like getting a shorter-term mortgage and increasing monthly payments, it increases the pain now to pay off the debt faster. Fortunately, this increase is happening at a time when the state budget can absorb the increase.

With uncompetitive salaries and cuts to health care benefits, the retirement program is the one positive left for state employees, but the retirement contributions have become a further drag on state employee salaries.  The State should cover more of the PERS contribution for its employees, as do many of the local governmental employers. Thank you, Chair Monroe-Moreno, for asking for options.

Finally, we support PERS’s budget enhancement requests to keep the retirement system functioning well.