The Pension Funding Council and the LEOFF 2 Board both met in July and recommended updated pension contribution rates for PERS, PSERS, and LEOFF 2 pension systems for the 2025-2027 biennium. Most city employees in Washington are members of one of these three state-managed pension systems.

The Pension Funding Council oversees rate setting for the PERS and other state pension programs, while the LEOFF 2 Board oversees rates for the LEOFF 2 system. The Council and Board discussed the impact of recent inflation, recent legislation to reduce the unfunded liability surcharge, and each pension system’s investment performance on the adoption of new rates. Ultimately, the employer rates for PERS and PSERS will be reduced as part of a six-year phase in plan for a lower long-term rate-of-return assumption adopted in 2021. The rates for LEOFF 2 will remain the same.

The adopted rates are not official until the 2025 Legislature votes to adopt the new rates as part of the new biennial state budget. However, the Legislature typically accepts the recommendations from the Pension Funding Council and LEOFF 2 Board.