Virginia HB 473: Virginia Retirement System; employer contributions.

Bill Text

VIRGINIAACTSOFASSEMBLY--2022SESSION
CHAPTER9
An Act to amend and reenact § 51.1-145 of the Code of Virginia, relating to Virginia Retirement
System; employer contributions.
[H473]
ApprovedMarch2,2022
Be it enacted by the General Assembly of Virginia:
1. That §51.1-145 of the Code of Virginia is amended and reenacted as follows:
§51.1-145. Employer contributions.
A. The total annual defined benefit employer contribution for each employer, expressed as a
percentage of the annual membership payroll, shall be determined in a manner so as to remain relatively
level from year to year. Each employer shall contribute for the defined benefit plans, including the
defined benefit component of the hybrid retirement program under § 51.1-169, an amount equal to the
sum of the normal contribution, any accrued liability contribution, and any supplementary contribution,
as well as amounts required for the defined contribution component of the hybrid retirement program
under § 51.1-169. The defined benefit contribution rates for each employer shall be determined after
each valuation biennially and shall remain in effect until a new biennial valuation is made. All defined
benefit contribution rates shall be computed in accordance with recognized actuarial principles on the
basis of methods and assumptions approved by the Board and as described in the Retirement System
funding policy.
B. The normal employer defined benefit contribution for any period shall be determined as a
percentage, equal to the normal contribution rate, of the total covered compensation of the members
employed during the period.
C. The normal defined benefit contribution rate for any employer shall be determined as the
percentage represented by the ratio of (i) the annual normal cost to provide the benefits of the retirement
system Retirement System with respect to members employed by the employer in excess of the members'
contributions to (ii) the total annual compensation of the members.
D. The accrued defined benefit liability contribution for any employer for any period shall be
determined as a percentage, equal to the accrued liability contribution rate, of the total compensation of
the members during the period.
E. The accrued defined benefit liability contribution rate for any employer shall be a percentage of
the total annual compensation of the members, determined so that a continuation of annual contributions
by the employer at the same percentage of total annual compensation over a period of 40 years
determined by the Board consistent with recognized actuarial principles and the Retirement System
funding policy will be sufficient to amortize the unfunded accrued liability with respect to the employer.
F. The unfunded defined benefit accrued liability with respect to any employer as of any valuation
date shall be determined as the excess of the actuarial accrued liability over the sum of assets of the
Retirement System as of the valuation date, as follows: (i) the then present value of the benefits to be
provided under the retirement system Retirement System in the future to members and former members
over (ii) the sum of the assets of the retirement system Retirement System then currently in the members'
contribution account and in the employer's retirement allowance account, plus the then present value of
the stipulated contributions to be made in the future by the members, plus the then present value of the
normal contributions expected to be made in the future by the employer.
G. The supplementary defined benefit contribution for any employer for any period shall be
determined as a percentage, equal to the supplementary contribution rate, of the total compensation of
the members employed during the period.
H. Until July 1, 1997, the supplementary contribution rate for any employer shall be determined as
the percentage represented by the ratio of (i) the average annual amount of post-retirement supplements,
as provided for in this chapter, which is anticipated to become payable during the period to which the
rate will be applicable with respect to former members to (ii) the total annual compensation of the
members.
I. The Board shall certify to each employer the applicable defined benefit contribution rate and any
changes in the rate. The Board shall also provide the applicable estimated defined contribution amounts
to each employer.
J. The defined benefit employer contribution for the year shall be increased to the extent necessary to
overcome any insufficiency if the contributions for any employer, when combined with the amount of
the retirement allowance account of the employer, are insufficient to provide the benefits payable during
the year.
K. The appropriation bill which that is submitted to the General Assembly by the Governor prior to

2of3
each regular session that begins in an even-numbered year shall include the defined benefit employer
contributions which that will become due and payable to the retirement allowance account from t