The Retirement System for the state of Wyoming started in 1953 when the Teachers and the state Employees’ Association were combined. Today, the System is made up of eight defined benefit plans.
- Public Employee Scheme (WRS) (Wyoming Retirement System)
- Teachers Plan
- Warden and Patrol Scheme
- Firefighters Plan
- Emergency Medical Technicians Scheme
- Air Guards Plan
- Law Enforcement Officers’ Scheme
- Judicial Plan
The largest group in the membership is the Public Employees under the Wyoming Retirement System.
Management of the Retirement System
The Retirement System of Wyoming is managed by a Board consisting of eleven members. It includes the State Treasurer and public employees representing the education system along with few qualified electors who are not employed by a participating employer of the Wyoming Retirement System. The monthly pension benefit is reported by the Board to the Internal Revenue Service.
Features of the Wyoming Public Retirement Plan
The defined benefit plan pays out monthly pensions for life for all the member public employees. It is defined by a formula benefit that is received at the time of employee’s retirement.
- Contributions – The employee makes a contribution of 7.0% of the gross salary to the pension fund. The employer makes a contribution of 7.2% to the fund of the employee’s gross salary.
- Vesting – The employee gets vested after completing four years of service. The number of months served is calculated by the number of actual hours put in. These forty eight months of service need not be in consecutive order. One full month of service is earned or credited when the employee works for a minimum of eighty six hours.
Calculation of the Pension Benefit
The age of the employee at the time of retirement has to be at least 50 and the designated beneficiary has to be at least twenty years of age. The benefit is worked out by the use of a multiplying factor that is fixed at 2.125% for the initial fifteen years of service and then followed by 2.250% for service above fifteen years. This is multiplied by the number of earned service credit years and the highest three-year period of the average salary. The employee can take full retirement at age 60 or at the Rule of 85 where the sum total of the age and the number of earned service credit years equals eighty five.
The employee can also opt for an early retirement at the age of 50 with a minimum of twenty five years of earned credit service. This is allowed with a reduced benefit. The Retirement System sends out an account statement to every employee once in a year. This is distributed generally during the first quarter after posting all the contributions for the previous year. The reduced benefit is calculated with the pension amount being decreased permanently by 5% for each year that is below the age of normal retirement (60).
When an employee becomes disabled and is unable to continue in service, he or she can take disability retirement, provided the employee has put in a minimum of ten or more years of service before the age of 60.
The pension benefit payments are sent directly to the employee’s designated bank account on the last working day of every month.
The employee has the option to choose how the benefit could be paid out after his or her death. The employee can contact the Wyoming Retirement System Board within three years of the projected retirement date and request an audit to be done along with the appointment of a beneficiary. The employee is given the option of a single lifetime annuity. In this annuity benefit, the employee is paid for life every month. After the death of the employee, the designated beneficiary will receive a lump sum amount of the balance in the pension fund.
The State of Wyoming does not make any provision for cost of living adjustments to be done every year to the annuity benefits of the employee.
The Retirement System Board of Wyoming manages the benefits of over 700 public employer members. There are almost 42,000 members who are active and 23,000 members who are retired. The current return on investment is at 5.5%. The fund asset value is 6.5 billion dollars. The level of funding is at 88.8%.
The State Treasurer heading the Retirement System of Wyoming has reported that an overhaul is not necessary to the public pension scheme for the State. He was addressing a group of retirees and state workers recently to inform them that The Legislature should not think in terms of moving over to a defined contribution scheme instead of the current defined benefit plan. He felt that the defined contribution schemes were not wholly reliable as means for offering pension benefit security and can sometimes make the funds run short of the liabilities. With a defined benefit plan, the risk is less as the investments are diversified rather than being concentrated into a single individual account. The State Treasurer felt that the pension program for the public employees in Wyoming was quite healthy and in better shape than that of most other states. (Source: http://www.wyomingnews.com/articles)