The state’s contributions to 10 state pension plans have increased from $1.6 billion in 2014 to $3.3 billion in 2023, a 61% increase once adjusted for inflation
Tom Gantert
The Center Square Washington
The state of Washington’s contributions to its multiple pension plans offered to its employees have doubled in cost over the past nine years.
The state’s contributions to 10 state pension plans have increased from $1.6 billion in 2014 to $3.3 billion in 2023, a 61% increase once adjusted for inflation.
The varied retirement pensions that includes eight retirement systems and 15 retirement plans pay out $6.4 billion a year to an estimated 217,000 retirees, according to the latest state audit that covers through June 2023.
The state pointed out that the pension plans’ combined funded ratio has increased from 87% to 96% from 2014 to 2022.
The state said there were multiple reasons for the increase in contributions.
From 2014 to 2022, there has been a significant increase in the number of members earning benefits as well as the number of people receiving pensions. There were 300,000 active members in 2014 and that increased to 340,000 in 2022.
“All else being equal, the more active employees earning benefits, the more money required to fund those benefits during their working career,” said Luke Masselink of the Office of the State Actuary.
The number of retirees and beneficiaries receiving a state pension has increased from 157,000 in 2014 to 217,000 in 2022.
Several other factors played a part in increased contributions.
In 2023, the state increased the assumption of how long people would live while receiving a pension. That led to higher costs projections.
The state has reduced its expected rate of return on investments, which also led to higher contributions.
The state used a 7.8% expected rate of return on investments in 2014, and by 2022, they had gone to a more conservative 7% rate of return.
Investment returns can vary greatly from year to year. For example, the state pension plan PERS Plan 1 lost $57.3 million in investments in 2020, but saw that increase to $976.6 million in 2021 and $496 million in 2022.
This report was first published by The Center Square Washington.
Also read:
- Signatures filed for initiatives on parental rights, blocking trans athletes from girls’ sports
Supporters of two initiatives on parental rights and transgender participation in girls’ sports filed signatures Friday, moving the measures closer to consideration by Washington lawmakers. - Vancouver Police investigate shooting
Vancouver Police are investigating a fatal shooting reported early Jan. 3 outside the Off-Ramp Sports Bar on Northeast 112th Avenue. - Vancouver Police release critical incident video from Dec. 28 officer-involved shooting
Vancouver Police Department released a Critical Incident Video related to a December 28 officer-involved shooting while the Office of Independent Investigations continues its review. - Opinion: Transit agencies need accountability not increased state subsidy
Charles Prestrud argues that Washington transit agencies face rising costs and declining ridership due to governance structures that lack public accountability. - Letter: ‘For years, American foreign policy too often felt like a blank check’
Vancouver resident Peter Bracchi argues that the 2025 National Security Strategy marks a long-overdue shift toward clearer priorities, shared responsibility, and interest-based American leadership. - POLL: Are you better off than you were a year ago?
This week’s poll asks readers to reflect on their personal financial situation and whether they feel better off than they were a year ago as economic conditions continue to shift. - Opinion: Does tailgating cause speeding?
Target Zero Manager Doug Dahl examines whether tailgating contributes to speeding and explains why following too closely increases crash risk with little benefit.
It means that every resident of Washington State pays roughly $421 this year to pay for the state retirement plans. A family of 4 pays $1,695 this year. We pay it when we go to the store, or the gas station, or when we pay our phone bill, and with our property tax. This spending takes precedence over fixing our roads or solving the homeless problem.