ERS Contribution Rate Set to Soar
The Huntington School District, likes its counterparts across the state, will be hit with a 37 percent increase in the Employees' Retirement System contribution rate next year.
The state comptroller's office announced the ERS contribution rate will be 16.3 percent of payroll during the 2011/12 school year. The rate is 11.9 percent this year and was 7.4 percent in 2009/10.
It is estimated the increase in the year-to-year ERS rate will cost Huntington School District taxpayers $600,000. "This will be a significant additional burden on the district," Superintendent John J. Finello said. "The state sets the contribution rate and makes all the rules for the pension system. Districts are simply given the bill."
The ERS encompasses employees who are in non-instructional positions, such as custodians, clerical workers, food service/cafeteria employees, etc. The annual contribution rate is based upon a formula that takes into account the number of ERS members and retirees, their ages, the value of its portfolio, etc.
The rate is levied on the salaries of ERS members. Thus the 2011/12 rate essentially amounts to 16.3 cents for every dollar earned by the workers covered by the ERS.
Instructional employees such as teachers, administrators, coaches and advisors are members of the separate Teachers' Retirement System. The TRS rate for 2011/12 has not yet been announced.