Public pensions in Nevada
|Nevada public pensions|
|Number of pension systems||3|
|State pension systems:|| Public Employees' Retirement System |
Judicial Retirement System
Legislators' Retirement System
|System type:||Defined Benefit Plan|
|Pension Health (2012)|
|Unfunded liabilities :||$11,236,871,000|
|Percent funded change:||1.1%|
|Percent funded rank:||23|
|Pension Fund Members (2012)|
|Other State Pension Information|
|Alabama • Alaska • Arizona • Arkansas • California • Colorado • Connecticut • Delaware • Florida • Georgia • Hawaii • Idaho • Illinois • Indiana • Iowa • Kansas • Kentucky • Louisiana • Maine • Maryland • Massachusetts • Michigan • Minnesota • Mississippi • Missouri • Montana • Nebraska • Nevada • New Hampshire • New Jersey • New Mexico • New York • North Carolina • North Dakota • Ohio • Oklahoma • Oregon • Pennsylvania • Rhode Island • South Carolina • South Dakota • Tennessee • Texas • Utah • Vermont • Virginia • Washington • West Virginia • Wisconsin • Wyoming|
As of 2012, the system had an unfunded liability of approximately $11,236,871,000 and was 71 percent funded. According to the Pew Center on the States Widening Gap update, a report on pensions in all 50 states, Nevada consistently failed to pay its full annual pension contribution from 2005 to 2010, with the system only 70 percent funded in ﬁscal year 2010. According to the report, most experts agree that a ﬁscally sustainable system should be at least 80 percent funded. 
State employees hired after January 1, 2010, have their annual pension benefits calculated using a new formula. Instead of the old formula by which the state multiplied the number of years of service by 2.67 to derive the percentage of salary to be replaced by pension benefits, the state dropped the multiplier to 2.5. In 2010, Nevada paid 92 percent of the recommended contribution to its pension plans and just 21 percent of what the state should have paid to fund retiree health benefits, a Pew Center on the States pension report found. 
According to the United States Census Bureau, the state has no locally-administered pension systems.
In fiscal year 2012, according to the systems' Actuarial Valuation Reports, Nevada had a total of 98,650 active members in its retirement plans. There were 62,681 other members. Our membership figures divide plan participants into two broad categories: active and other. Active members are current employees contributing to the pension system. Other members include retirees, beneficiaries and other inactive plan participants (usually terminated employees entitled to benefits but not yet receiving them).
The following data was collected from the state's 2012 Actuarial Valuation Reports, which measured fund status as of June 30, 2012. Valuation reports are annual reports produced by outside consultants, using unaudited data provided by the pension systems themselves, in order to determine what employers in the system should contribute in the coming year to maintain or improve the fiscal health of the pension funds.
Nevada’s Actuarial Valuation Reports for 2012 were produced by CliftonLarsonAllen (CLA), a national accountancy firmm. The "percentage funded" is calculated by taking the current value of the fund and dividing by the estimated amount of total liabilities. The assumed rates of return used to calculate current fund value vary by system (see "Rate of return" below for more information).
The Government Accountability Office (GAO) and Pew Research Centers cite a percent funded ratio of 80 percent as the minimum threshold for a healthy fund, though the American Academy of Actuaries suggests that all pension systems "have a strategy in place to attain or maintain a funded status of 100 percent or greater.
The column labeled "SBS figure" refers to a market liability calculation of the fund by the nonprofit organization State Budget Solutions. This analysis uses a rate of return of 3.225 percent, which is based upon the 15-year Treasury bond yield. The organization calls this a "risk-free" rate of return that would make it easier for states to achieve their pension funding requirements in the future. Since 2006, all private sector corporate pension plans have incorporated market costs into their funding schemes.
|Basic Pension Plan Information -- Public Employees' Retirement System of Nevada|
|Plans||Current value||Percentage funded||Unfunded liabilities||Membership|
|State figure||SBS figure||State figure||SBS figure|
|Public Employees Retirement System||$27,399,000,000||71%||N/A||$11,205,900,000||N/A||98,512 active members|
|Judicial Retirement System ||$63,934,000||68.6%||$29,199,000||99 active members|
|Legislators Retirement System ||$3,806,000||68.2%||$1,772,000||39 active members|
|TOTALS||$27,466,740,000||71 percent||36 percent||$11,236,871,000||$48,468,165,000||98,650 active members|
Annual Required Contribution
Annual Required Contributions (ARC) are calculated annually and are a sum of two different costs. The first component is the "normal cost," or what the employer owes to the system in order to support the liabilities gained in the previous year of service. The second component is an additional payment in order to make up for previous liabilities that have not yet been paid for. According to a report by the Pew Center on the States, in 2010, Nevada paid 93.04 percent of its annual required contribution.
On June 25, 2012, the Government Accounting Standards Board (GASB) approved a plan to reform the accounting rules for state and local pension funds. These revised standards were set to take effect in fiscal years 2013 and 2014. As a result, ARCs were removed as a reporting requirement. Instead, plan administrators and accountants will use an actuarially determined contribution or a statutory contribution for reporting purposes.
|ARC Historical Data|
|Fiscal year||Public Employees' Retirement System||Legislators' Retirement System||Judicial Retirement Fund|
|Annual Required Contribution (ARC)||Percentage contributed||Annual Required Contribution (ARC)||Percentage contributed||Annual Required Contribution (ARC)||Percentage contributed|
Historical funding levels
|Historical pension plan data-Legislators Retirement System and Judicial Retirement System|
|Year||Value of assets||Accrued liability||Unfunded liability||Funded ratio|
|Change from 2007-2012||-$30,985,600||$37,847,300||$6,831,200||2.3%|
Rate of return
|Pension Hotspots Report|
Nevada’s Public Employees’ Retirement System earned an estimated 2.9 percent return on its investments in the fiscal year ending June 30, and is now valued at $25.8 billion. 
| Percent Funded Status of Pension Plans |
in the 50 States as of November 2013
|Note: The data in this map was compiled from state CAFR reports and Actuarial Valuation documents. Figures reflect a combination of all of the state pension plans.|
According to a 2012 analysis by the Pew Center for the States, most state pension plans assume an 8 percent rate of return on investments. Critics assert that this assumption is unrealistic, citing changing market conditions and significantly lower investment returns across the board over the past several years.
According to an issue brief by the National Association of State Retirement Administrators, the median annualized investment return for public pensions for the five-year period ending June 30, 2013 was 5.3 percent. However, over the 25-year period ending June 30, 2013, the median investment return was 8.6 percent. The report's authors noted, "Although public pension funds, like other investors, have experienced sub-par returns in the wake of the 2008-09 decline in global equity values, median public pension fund returns over longer periods meet or exceed the assumed rates used by most plans."
In September 2013, the nonprofit organization State Budget Solutions published an analysis of state pension funding levels. In its calculations, State Budget Solutions used a 3.2 percent rate of return, the 15-year Treasury bond yield as of August 21, 2013, to discount plan liabilities.
The research found that, all states combined, state public employee pension plans have only 39 percent of the assets they need to cover their promised payments—a $4.1 trillion gap. According to the report, Nevada's public pension plans were 36% funded, making it the 25th most funded state.
Moody's report on adjusted pension liabilities
On June 27, 2013, Moody's Investor Service released its report on adjusted pension liabilities in the states. The Moody's report ranked states "based on ratios measuring the size of their adjusted net pension liabilities (ANPL) relative to several measures of economic capacity." In its calculations of net pension liabilities, Moody's employed market-determined discount rates (5.67 percent for Nevada) instead of the state reported assumed rates of return (7.75 percent for Nebraska).
The report's authors found that adjusted net pension liabilities varied dramatically from state to state, from 6.8 (Nebraska) percent to 241 (Illinois) percent of governmental revenues in fiscal year 2011.
The adjusted net pension liability for Nevada's pension system in fiscal year 2011 was ranked 41st. The following table presents key state-specific findings from the Moody's report, as well as the state's national rank with respect to each indicator.
|Adjusted net pension liabilities (ANPL) relative to key economic indicators - Nevada|
|Governmental revenue*||Personal income||State GDP||Per capita|
|*Moody's uses governmental revenues as reported in each state's consolidated annual financial reports; this includes not only state-generated revenue, but federal funds, as well.|
Act No. 452
This act established the amount of the State's share of the costs of premiums for group insurance for active state officers and employees who participate in the Public Employees' Benefits Program, established the amount for the share of the costs for group insurance under the Program that is required to be paid by the State and local governments for retirees, and established the share of the cost of qualified medical expenses for individual Medicare insurance plans through the Program.
NV S 201
This bill, which failed on April 22, 2013, would have revised the provisions governing the employment of retired public employees.
Some changes were made to the retirement system by the 2009 Legislature, including raising the retirement age to 62 from 60 for an employee with 10 years of service. An employee can still retire at any age with 30 years of service. 
The SAGE Commission, a panel created by outgoing Gov. Jim Gibbons to look for efficiencies in state government, also recommended changes to the retirement system but did not advocate a change to a defined contribution plan. Recommendations from the Spending and Government Efficiency panel include setting a minimum retirement age of 60 before benefits can be paid out. Other recommendations include calculating the retirement benefit over five years of pay, not the current three highest pay years, and imposing a moratorium on any benefit enhancements until the plan is fully funded. 
Nevada does not prohibit "double-dipping." Almost 700 state workers have taken advantage of the double-dipping law, which allows some workers who are retired and collect a pension to come back to work at state jobs where a "critical labor shortage" exists and earn paychecks. These are positions that state employers have found difficult to fill for a variety of reasons, including that they are in rural locations, don't pay well or require special skills. The state retirement program spent $54.4 million on double-dipping employees from 2001 to 2008, according to a study done for the Legislature. The next report isn't due until 2014, so a current assessment of what it's costing is not available. 
Local public pensions
- See Also: Local government public pensions
According to the United States Census Bureau, the state has no locally-administered pension systems.
- The Reno Gazette-Journal filed a lawsuit against the retirement system, which denied the newspaper's request for the names and benefit amounts of retired public employees. The paper said the information is a matter of public record. Carson City District Judge James Russell supported the newspaper, concluding that the purpose of the Nevada Public Records Act is to "ensure accountability of the government to members of the public by facilitating public access to vital information about government activities." Judge Russell ordered PERS to hand over the records. PERS disagrees. Chris Wicker, the attorney for PERS, said the law is not that clear. "Since the 1970s, PERS interpreted (state laws) as treating employee files as confidential," Wicker said, adding that PERS wants to comply, but needs a "definitive statement" from high court justices on what the law means. 
- The pension website provides a Popular Annual Financial Report, but the Comprehensive Annual Financial Report must be requested to be mailed, and previous reports are not archived online. 
- According to state law, "The official correspondence and records, other than the files of individual members or retired employees, and, except as otherwise provided in NRS 241.035, the minutes, audio recordings, transcripts and books of the System are public records and are available for public inspection." On December 22, 2011, in response to a lawsuit brought by the Reno Gazette-Journal, District Judge James Todd Russell ruled that the names and pension amounts of retired employees were public record. 
- Pension fund performance data can be obtained by requesting a Comprehensive Annual Financial Report through NVPERS, or downloading the 2011 CAFR from Sunshine Review A Popular Annual Financial Report is available online, though it's less detailed than the CAFR. Unlike many other state pension systems, NVPERS doesn't provide previous CAFRs and other financial information online.
- In law, Nevada has some statutes in place for public access of asset disclosure, gifts, and hospitality given to board members and administrators of public pension funds, but the statutes become relevant only after board members and administrators receive a specific level of income, which, in practice, make the statutes inactive.
- For the CAFR, an independent auditor reviews the report before publication. Clifton Gunderson LLP audited the 2011 CAFR.
- Public Employees' Retirement System of Nevada
- Nevada State Pension Fund Management - State Integrity Investigation
- 2011 Actuarial Valuation Report
- ↑ Figures below are compiled by adding up all state pension plans
- ↑ This figure is derived by calculating the percent difference between the current year's funding level and the system's percent funded from the prior year.
- ↑ Rank is relative to the 50 state pension programs. "1" refers to the healthiest pension plan while "50" would be the least well-funded plan.
- ↑ Pew Center on the States Widening Gap Update
- ↑ 2011 Annual Survey of Public Employment and Payroll, Census 2010
- ↑ 2010 Annual Survey of Public Employment and Payroll--Membership by State, Census 2010
- ↑ 7.0 7.1 Pew Center on the States "The Trillion Dollar Gap" Feb. 2010
- ↑ Nevada News Bureau, Nevada’s Public Employee Pension Plan Gets Low Marks In Latest Pew Study, June 19, 2012
- ↑ 9.0 9.1 "Public Employee Retirement Systems State- and Locally-Administered Pensions Summary Report: 2010", United States Census Bureau, April 30, 2012
- ↑ Organisation for Economic Co-operation and Development "Pensions Glossary," accessed November 27, 2013
- ↑ CliftonLarsonAllen "About CliftonLarsonAllen," accessed November 1, 2013
- ↑ United States Government Accountability Office Report to the Committee on Finance, U.S. Senate "State and Local Government Retiree Benefits: Current Status of Benefit Structures, Protections, and Fiscal Outlook for Funding Future Costs," September 2007. Accessed October 23, 2013
- ↑ American Academy of Actuaries "Issue Brief: The 80% Pension Funding Standard Myth," July 2012. Accessed October 23, 2013
- ↑ Governing Magazine " Is There a Plot Against Pensions?" October 14, 2013
- ↑ 15.0 15.1 State Budget Solutions, "Promises Made, Promises Broken - The Betrayal of Pensioners and Taxpayers," accessed September 20, 2013
- ↑ "Public Employees Retirement System Actuarial Valuation Report as of June 30, 2012," accessed October 30, 2013
- ↑ 17.0 17.1 Analysis only available for system totals and not individual funds.
- ↑ "Judicial Retirement System Actuarial Valuation Report as of June 30, 2012," accessed October 30, 2013
- ↑ "Legislators Retirement System Actuarial Valuation Report as of June 30, 2012," accessed October 30, 2013
- ↑ "Widening Gap Update: Nevada," June 18, 2012
- ↑ Government Accounting Standards Board "Annual Required Contribution (ARC)," accessed October 17, 2013
- ↑ Reuters "Little-known U.S. board stokes hot pension debate," July 10, 2012
- ↑ State Budget Solutions "GASB's ineffective public pension reporting standards set to take effect," June 5, 2013
- ↑ 24.0 24.1 24.2 2012 CAFR
- ↑ Carson Now, State Public Employee Pension Plan Sees 2.9 Percent Return In Fiscal Year 2012, July 11, 2012
- ↑ "The Widening Gap Update,” Pew Center on the States, accessed October 17, 2013
- ↑ The New York Times "Public Pensions Faulted for Bets on Rosy Returns," May 27, 2012
- ↑ National Association of State Retirement Administrators "NASRA Issue Brief: Public Pension Plan Investment Return Assumptions," October 2013
- ↑ State Budget Solutions, "Promises Made, Promises Broken - The Betrayal of Pensioners and Taxpayers," accessed September 20, 2013
- ↑ 30.0 30.1 30.2 30.3 Moody's Investor Service "Adjusted Pension Liability Medians for US States," June 27, 2013
- ↑ 31.0 31.1 National Conference of State Legislatures, "PENSIONS AND RETIREMENT PLAN ENACTMENTS IN 2011 STATE LEGISLATURES," accessed October 31, 2013
- ↑ Cite error: Invalid
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- ↑ Reno Gazette Journal, RGJ investigates: Nevada's pension laws allow double-dipping, May 30, 2011
- ↑ Plan Sponsor, Nev. Pension Fund Challenging Pensioner Disclosure Ruling, Jan. 19, 2012
- ↑ Popular Annual Financial Report
- ↑ 36.0 36.1 Comprehensive Annual Financial Report request form
- ↑ NRS-286.110, Public Employees’ Retirement System: Establishment; review of System; use of state services; public inspection of records; liability of public employers
- ↑ Las Vegas Journal-Review, Transparency and the state pension system, January 5, 2012
- ↑ PERS pension public records
- ↑ PAFR
- ↑ State Integrity Investigation, Nevada laws concerning pay-to-play
|State public pension systems||
Alabama • Alaska • Arizona • Arkansas • California • Colorado • Connecticut • Delaware • Florida • Georgia • Hawaii • Idaho • Illinois • Indiana • Iowa • Kansas • Kentucky • Louisiana • Maine • Maryland • Massachusetts • Michigan • Minnesota • Mississippi • Missouri • Montana • Nebraska • Nevada • New Hampshire • New Jersey • New Mexico • New York • North Carolina • North Dakota • Ohio • Oklahoma • Oregon • Pennsylvania • Rhode Island • South Carolina • South Dakota • Tennessee • Texas • Utah • Vermont • Virginia • Washington • West Virginia • Wisconsin • Wyoming