For Immediate Release: December 23, 2019
Contact: Marty Karlon, Public Information Officer, (603) 410-3594; [email protected]
CONCORD, NH – The Board of Trustees of the New Hampshire Retirement System (NHRS, the retirement system) voted unanimously in December to initiate an actuarial experience study for the fiscal years 2016-19 period.
The experience study, which was recommended by GRS Consulting, the retirement system’s independent actuary, will review the actual plan experience as compared to the current economic and demographic assumptions used to calculate pension and medical subsidy liabilities. The last experience study was conducted four years ago for the five-year period ending June 30, 2015. New Hampshire law requires the retirement system’s actuary to conduct an experience study at least once every five years.
GRS recommended that the experience study be undertaken in conjunction with the June 30, 2019, rate-setting valuation so that any updated assumptions adopted by the Board can be applied to the 2019 valuation, which will serve as the basis for the FY 2022-23 employer contribution rates.
GRS Chief Actuary David Kausch told the Board at its December 10 meeting that if the next experience study was performed on the five-year schedule, the impact of the experience study would not be reflected until the June 30, 2021, rate-setting valuation, six years after the last assumption changes took effect.
“The Trustees have a legal obligation to adopt actuarially sound assumptions, including the assumed rate of return. In taking this action, the Board is being mindful of recent capital market projections, the prolonged period of low, long-term interest rates and other economic and demographic trends that are key to determining the pension system’s liabilities. The decision to initiate the experience study now is consistent with the Board’s fiduciary duty to act in the best interests of the retirement system’s members and beneficiaries,” said NHRS Executive Director George P. Lagos.
NHRS provides retirement, disability, and death benefits to its eligible members and their beneficiaries. The State of New Hampshire and more than 460 local government employers participate in NHRS for their employees, teachers, firefighters, and police officers. NHRS has approximately 48,000 active members and more than 38,000 benefit recipients. NHRS administers a defined benefit plan qualified as a tax-exempt entity under sections 401(a) and 501(a) of the Internal Revenue Code.
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