POLL: Most PERS members underestimate costs, unaware of upcoming rate hike
A bill that would require public agencies to provide their employees with basic information about the state retirement system appears to be badly needed, as most public employees are unfamiliar with how the system works, according to a just-released poll from the Nevada Policy Research Institute.
Nevada public employees have seen their retirement costs soar nearly 50 percent since 2007 and will be hit with yet another rate increase in July. These increases have all gone towards paying down the system’s multi-billion dollar debt stemming from the underfunded benefits promised to earlier workers — meaning none of this cost increase will benefit the current employee paying today’s all-time high rates.
Most public employees, however, are simply in the dark about these facts. According to the poll, 64 percent of public employees were not even aware of the upcoming rate hike in July, while 73 percent did not know about the history of past rate increases.
One of the biggest inequities of the current system is that all employees hired after July 1, 2015 will see reduced benefits while still being forced to pay the same national-high rates as their veteran colleagues. Yet, most respondents (56%) were unaware of this fact as well.
Accurate information greatly affects public employees’ perception of the system and its costs, the poll found.
Initially, 52 percent of public employees described the amount they are required to pay to the Public Employees’ Retirement System of Nevada (PERS) as “about right,” with only 26 percent describing their PERS costs as “too high.” However, according to the poll, most workers (67%) underestimated the amount they were paying into the system.
When respondents were given accurate information about the amount they are paying and the amount that goes toward paying off the system’s debt, attitudes changed dramatically. When told that the upcoming rate hike will go entirely towards debt rather than their own, future benefit, a clear majority (54%) described their PERS costs as “too high.”
Nevada Policy Vice President Robert Fellner argues that this poll demonstrates a clear need for the kind of basic education that Senate Bill 221 would provide.
“Because unions have consistently opposed PERS reform, it is their members and other public employees who are now being forced to pay the nation’s highest retirement rates, while receiving reduced benefits,” Fellner said.
“Apparently, the only way to maintain support for this fundamentally broken system is to keep those very workers in the dark.”
Poll of Nevada State and Local Government workers was conducted by OH Predictive Insights between February 22nd and March 17th, 2021, with a MoE of ± 5.6%. Full results can be found by clicking here.