NH Retirement System
The past several years have seen much debate surrounding the status of the NH Retirement System (NHRS) accounts and proposed sustainable funding solutions. Listed below are a number of reports, memos and statistical presentations of current or continuing interest. For a historical summary of the 2007-2012 laws affecting the NHRS, visit our NHRS Legislative Activity page.
Many questions have come in to NHMA staff seeking information about the effect of the variety of law suits against the State and the New Hampshire Retirement System (NHRS). Review NHMA's Retirement Litigation Overview.
NHMA Retirement Policy and Documents
NHMA Retirement Documents:
Public Employee Retirement Benefits: Defined Contribution vs. Defined Benefit Plans, New Hampshire Town and City, September/October 2012
Public Pensions and the Perfect Storm: National Strategies for Reform,
New Hampshire Town and City, June 2010
2011 Retirement Reform
NHMA HB 2 Retirement Provisions, Table of Impacts by Bill Section, Final Version passed by House and Senate, June 22, 2011
NHMA HB 2 Retirement Provisions, Table of Impacts by Bill Section, Final Version (Appendix 2, 2011 Final Legislative Bulletin) (PDF)
SB 3 Committee of Conference Report, June 6, 2011 (link to final version of the bill)
Major Provisions of the 2011 Pension Reform Legislation (SB 3), prepared by the House and Senate June 7, 2011 (PDF)
Senate press conference, January 27, 2011: View video of NHMA Municipal Advocacy Committee Chair Pamela Brenner speaking in support of the proposed bill.
New Hampshire Public Television, NH Outlook, The Future of Retirement.
NHMA table of 2011 proposed legislation dealing with the NH Retirement System.
NHRS Certified Employer Contribution Rates
Chapter 261 (HB 1483), Laws of 2012 repealed the penalty for excess retirement benefits that was enacted in 2008 and had been slated to take effect July 1, 2012.
Effective Date for “Spiking” Assessments – Chapter 230, Laws of 2011 (HB 462) amends the formula for computing the employer assessment for excess pension benefits and extends the effective date of the assessment from July 1, 2011 to July 1, 2012, with a four-year phase-in for the assessment. Assessments are applicable to any contracts or collective bargaining agreements entered into on or after January 1, 2010. The bill requires the New Hampshire Retirement System to provide an employer assessment estimator (calculator) on its website to assist employers in determining the impact of the spiking assessment.
Effective Date for "Spiking" Assessments - Chapter 357, Laws of 2010 (SB 504) extends from July 1, 2010, to July 1, 2011, the effective date for implementation of the pension penalty assessment resulting from payment of excess benefits as enacted in Chapter 300:35, Laws of 2008. E.D. July 20, 2010.
Methodology Behind the “Spiking” Assessment, NHRS report required by HB 641, November 25, 2009.
Spiking Assessment – Chapter 300, Laws of 2008 (HB 1645) enacts the initial spiking assessment provision under sections 33 and 34 of the bill, effective August 28, 2008.
Legislative Study Committees and Commissions
Special House Committee on Defined Contribution Retirement Plans for Public Employees. Final Report, November 13, 2012
Committee to study the establishment of a federal tax qualified voluntary defined contribution plan – Chapter 224, section 184, Laws of 2011. Final report due November 1, 2011.
Committee to study retirement system matters related to disability retirement, medical subsidies, and cost of living adjustments or supplemental allowances – Chapter 224, section 185, Laws of 2011. Final report due November 1, 2011.
Commission to Propose a Retiree Health Care Benefits Funding Model, Final Report, December 22, 2009. See also Chapter 379, Laws of 2010.
Commission to Study the Feasibility of Authorizing, and the Depletion Schedules for, Future COLAS to be Issued at Different Rates to or Within Each Subgroup Within the Special Account, Final Report, December 1, 2009.
Commission to Study the Long-term Viability of the NH Retirement System, Final Report, released January 2, 2008.
GASB Proposes Changes to Pension Accounting
and Financial Reporting
The Government Accounting Standards Board (GASB) has issued two new pronouncements, Statement 67 and 68 which will fundamentally change pension accounting and financial reporting for state and local governments. The GASB statements disconnect the financial reporting methodology from the funding methodology, so that the NH Retirement System (NHRS) financial report will be based on very different numbers than the actuarial valuation report used for pension rate setting purposes.
A second, and more pressing issue for local governments, is that Statement 68 requires an allocation of the unfunded liability to the participating employers (all 475 of them) so that each employer shows their “share” of the liabilities on their own balance sheet. The primary concern here is that the GASB is taking a plan that is statutorily designed to share the assets and liabilities of a public pension system (i.e. shared risk) and requiring through accounting rules that those liabilities be assigned to all participating employers via subjective and volatile assumptions, and then reflected on their balance sheets. In addition, the GASB is also changing how those liabilities are calculated, which may increase the amount of the liabilities that will then be apportioned to each participating employer.
The NH Municipal Association is working with the NH Retirement System and the NH Government Finance Officers Association to provide educational sessions and information necessary for NHRS participating employers to implement these new standards by the effective date (for fiscal years beginning after June 15, 2014). More information about these educational sessions will be made available soon.
Additional information regarding the GASB’s proposed changes to pension accounting and financial reporting may be found on their website.
Other Reports and Links
NH Retirement System
NH Retirement System Comprehensive Annual Financial Reports (CAFR)
The Trillion Dollar Gap: Underfunded State Retirement Systems and the Roads to Reform, The Pew Center on the States, February 2010
The Pew Center on the States – New Hampshire rating
If you have any questions or need additional information, contact the Government Affairs staff at 800.852.3358, ext. 3408, or email email@example.com.