Office of Program Policy Analysis and Government Accountability
Office of Program Policy Analysis and Government Accountability

FRS Defined Contribution Plan Costs Are Typically More Predictable; the Fiscal Impact of Requiring New Employees to Enroll in the Plan Is Influenced by Many Factors

Report 10-29, March 2010




Report Summary

Most states (39) provide only defined benefit retirement plans to their employees, although defined contribution plan costs are more predictable. The Florida Legislature has considered several proposals to close the defined benefit Pension Plan and require all new employees to join the defined contribution Investment Plan. This action would provide increased certainty in the level of required employer contributions to the FRS over time and may reduce certain costs. However, closing the Pension Plan would increase funding requirements for those employees who remain in the plan. Future costs of the two plans are dependent on many variables, and the Legislature has requested an actuarial study to estimate these costs.


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Copies of this report in print or alternate accessible format may be obtained by email OPPAGA@oppaga.fl.gov, telephone (850) 488-0021, or mail 111 W. Madison St., Room 312 Tallahassee, FL 32399-1475.
Copies of this report in print or alternate accessible format may be obtained by email OPPAGA@oppaga.fl.gov, telephone (850) 488-0021, or mail 111 W. Madison St., Room 312 Tallahassee, FL 32399-1475.
FRS, Retirement, Florida Retirement System, Division of Retirement, SBA, State Board of Administration, Defined Benefit, Defined Contribution