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Florida Retirement System Pension Plan Valuation Met Standards, Report No. 11-17, May 2011
 
Full report in PDF format


This report discusses issues related to the state's retirement programs. Our actuarial consultant, Gabriel Roeder Smith & Company, concluded that the 2010 valuation was made in accordance with relevant state laws and rules and actuarial standards. It further concluded that the assumptions and methods used in the valuation were generally reasonable. However, our consultant made several observations.
  • The actuarial value of the pension fund was $120.9 billion, with an unfunded actuarial liability of $16.7 billion as of July 1, 2010.
  • The 2010 valuation does not take into account an assumption for the probability that system members will participate in the Deferred Retirement Option Program (DROP) and may understate the unfunded actuarial liability by $2.02 billion. Our consultant believes that future valuations should include disclosures that fully reflect the effect of expected DROP participation.
  • The payroll growth assumption understates actual payroll growth experience. As a result, amortization of the actuarial liability may be understated by between $210 and $270 million. To address this issue, our consultant believes that future FRS actuarial reports should disclose the 10-year history of payroll growth using the unfunded actuarial liability funding approach. Our consulting actuary also noted that while not unreasonable, the inactive healthy mortality rate assumptions appear conservative.
  • Finally, our consultant believes that the actuarial valuation would be improved by providing prior year results in a side-by-side comparison with current year results as appropriate.

Which Government Program Summaries contain related information?

Retirement Benefits Administration

What other OPPAGA-related materials are available?

  • Report No. 14-FRS Actuarial Review of the July 1, 2013 Actuarial Valuation of the Florida Retirement System,published in July 2014.
  • Report No. 14-99 Actuarial Review of the July 1, 2013 Actuarial Valuation of the Florida Retirement System,published in July 2014.
  • Report No. 13-FRS Actuarial Review of the July 1, 2012 Actuarial Valuation of the Florida Retirement System,published in August 2013.
  • Report No. 13-99 Actuarial Review of the July 1, 2012 Actuarial Valuation of the Florida Retirement System,published in August 2013.
  • Report No. 12-09 Florida Retirement System Pension Plan Valuation Met Standards,published in July 2012.
  • Report No. 10-46 Florida Retirement System Pension Plan Valuation Met Standards,published in June 2010.
  • Report No. 09-24 Florida Retirement System Pension Plan Valuation Met Standards,published in April 2009.
  • Report No. 08-30 Program Review: Florida Retirement System Pension Plan Fully Funded and Valuation Met Standard,published in April 2008.
  • Report No. 07-24 Florida Retirement System Pension Plan Fully Funded and Valuation Met Standard,published in April 2007.
  • Report No. 06-38 Florida Retirement System Pension Plan Fully Funded and Valuation Met Standard,published in April 2006.
  • Report No. 05-25 Florida Retirement System Pension Plan Fully Funded and Valuation Met Standards,published in April 2005.
  • Report No. 04-70 Multi-Year Projections of Retirement System Funding Should Be Provided to the Legislature,published in October 2004.
  • Report No. 04-13 Program Review of the Florida Retirement System Pension Plan Fully Funded and Valuation Met Standards,published in February 2004.

Copies of this report in print or alternate accessible format may be obtained by telephone (850/488-0021), by FAX (850/487-9213), in person, or by mail (OPPAGA Report Production, Claude Pepper Building, Room 312, 111 W. Madison St., Tallahassee, FL 32399-1475).
e-mail address: oppaga@oppaga.fl.gov


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