§ 15-5-211 — Fire A pension plan legislative findings

(a) The legislature finds:
(i) The paid firemen's pension plan was established
in 1935 and restructured in 1981. In 1981 with the restructuring
of the paid firemen's pension plan, the original firemen's
pension plan became known as "paid firemen plan A" or "Fire A".
The legislature contributed approximately forty-six million
eight hundred thousand dollars ($46,800,000.00) between 1981 and
1996 to make up the accumulated underfunding of Fire A from
inception to the point of restructuring;
(ii) Statute has directed since the inception of the
paid firemen's pension plan and as provided in W.S. 15-5-202
that the firemen's pension account shall be administered without
liability on the part of the state beyond the amount of the
fund;
(iii) Upon recommendation from the Wyoming retirement
system and consulting actuaries, the legislature adopted an act
ceasing contributions to Fire A as of April 1, 1997. This
included the previously required contributions of eight percent
(8%) of salary, employer contributions of twenty-one percent
(21%) of salary and contributions of fifty percent (50%) of the
fire insurance premium tax collected by the state each year;
(iv) Had employers and employees made contributions
between April 1, 1997 and December 31, 2020 the estimated
contributions would be worth approximately thirty-three million
dollars ($33,000,000.00) as of December 31, 2020, using a seven
percent (7%) annual rate of return;
(v) Upon the recommendation of the Wyoming retirement
system and consulting actuaries, the legislature repeatedly
increased benefits for Fire A members and retirees. Increases
included an increase of the percentage of salary used to
calculate benefits, the removal of a cap on benefits and the
increase of benefits for surviving spouses from thirty-three and
one-third percent (33 1/3%) up to one hundred percent (100%);
(vi) Despite an actuarial report dated January 1,
2002 noting a deteriorated funded position of Fire A, employee
and employer contributions were not reinstituted;
(vii) The Wyoming retirement system reports that the
Fire A retiree pension payroll was nine million three hundred
thousand dollars ($9,300,000.00) in 2002 and is estimated to be
sixteen million three hundred thousand dollars ($16,300,000.00)
in 2021. This increase is primarily due to the statutory three
percent (3%) annual compounded cost-of-living adjustment that
has been in effect since 2004;
(viii) In 2014 a bill to improve the funded status of
Fire A by reducing the cost of living provision and restarting
contributions from employers and the state did not pass the
legislature;
(ix) The retirement system board shifted the
investments of Fire A to a fixed-income portfolio on January 1,
2021;
(x) The retirement system actuaries estimate Fire A
will exhaust all assets sometime in 2026 if no changes are made;
(xi) As of January 1, 2021, there were two hundred
sixty-six (266) retirees and surviving spouses eligible to
receive benefits from Fire A;
(xii) The Wyoming retirement system calculator
provided to the legislature estimates that if the funding for
Fire A were to be solved entirely with contributions, it would
require a total contribution of one hundred forty-eight million
one hundred thousand dollars ($148,100,000.00) on January 1,
2022, assuming assets are reinvested in a diversified portfolio;
(xiii) The Wyoming retirement system calculator
provided to the legislature estimates that if the funding for
Fire A were to be solved entirely with benefit reductions, it
would require elimination of all future cost-of-living
adjustments and an additional benefit reduction of fifty-seven
percent (57%) of all current benefits on January 1, 2022. This
assumes assets are reinvested in a diversified portfolio;
(xiv) A combination of benefit reductions and
additional contributions could be used to provide for the
funding requirements to make Fire A actuarily solvent for the
remaining life of the plan.