(NPRI) – Nevada’s pension system is broken. PERS says its unfunded liability is $10.4 billion. Using a risk-free rate of return, PERS’ liability is around $40 billion.
Either way, that’s a lot of debt.
While many politicians would like to ignore the problems in PERS and let your children and grandchildren suffer the consequences, Assemblyman Randy Kirner has proposed AB190 to fix this broken system.
AB190 would preserve the pension benefits of current retirees and current government employees. Let me repeat that: There would be no change for current retirees or employees. Anyone whose tries to claim something different is simply wrong or is trying to sabotage this needed reform.
Now new government employees, as of July 1, 2016, would move into a hybrid pension plan that would be personal and portable. There would be a 6 percent defined benefit component and employees and employers would each contribute 6 percent into an individualized retirement account.
Local government employees would also make a 6 percent contribution to pay down the unfunded liability PERS currently has.
This hybrid system is ideal for today’s younger workforce, which values flexibility in their career planning and don’t see themselves working for the same employer for 30 years. It also allows them to leave their pensions to their spouse or children.
As you can imagine, union officials are pulling out all the stops to try and stop this reform, which is similar to changes passed recently in Utah and Rhode Island.
Taxpayers, though, can’t afford to have lawmakers ignore this problem any longer and today’s new employees need a pension system that is personal and portable.
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