PROFS cosponsored a La Follette Seminar featuring Gary Gates, former Secretary of the Department of Employee Trust Funds. Gates spoke to faculty, staff and others about the history of the Wisconsin Retirement System on Wednesday, February 21 in Union South.
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La Follette School Seminar on WRS
PROFS is pleased to cosponsor a seminar on the Wisconsin Retirement System with the La Follette School of Public Affairs.
Gary Gates, former Secretary of the Wisconsin Department of Employee Trust Funds will provide a history of WRS and share why it remains one of the strongest pension systems in the country. In 2016, the Milwaukee Journal Sentinel provided an in-depth look at Gates and the pension system he crafted.
The seminar is at 12:30 pm, Wednesday, February 21 in Union South and is open to the public. Refreshments will be served.
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Open in new tab Modest Pension Increases Projected for WRS Retirees
The State of Wisconsin Investment Board (SWIB) announced yesterday that preliminary returns for the Wisconsin Retirement System (WRS) should result in modest increases for retirees.
The Core Fund, the state’s largest trust fund at $88.7 billion, slightly surpassed its benchmark with a one-year return of 5.7 percent. The five-year return is projected to be 9.3 percent. The riskier Variable Fund, with holdings of $7.3 billion, lagged just behind its benchmark with a one-year return of 7.3 percent.
Last year both funds posted strong gains, resulting in the first increase for annuitants in five years.
PROFS carefully monitors legislation relating to WRS and lobbies for the best possible pensions for faculty.
In 2011, the legislature requested a study to examine allowing WRS participants to choose a defined contribution plan or opt out of WRS altogether. PROFS hosted a campus forum featuring experts on WRS, including the former legal counsel to SWIB and the former secretary of the Department of Employee Trust Funds. The resulting 2012 legislative report recommended no changes to WRS.
The state’s retirement system is very highly regarded — Morningstar recognized WRS as the strongest state pension in country, and the Pew Center on the States found WRS to be fully-funded and called it a “solid performer.”
Legislative Update
Tax Cuts
Governor Scott Walker announced a tax cut proposal at his State of the State address last month. He plans to utilize part of a $912 million budget surplus to lower state income and property taxes. The plan includes:
- A property tax cut of about $131 on a $150,000 home, Wisconsin’s median home value
- An income tax cut of $44 to $58 for each tax filer
- A change in tax policy that would result in the state no longer withholding more income taxes than actually owed, resulting in about $58 more per month per family
The governor’s plan adds $100 million to the state’s rainy day fund, but raises the structural deficit by about $100 million to $725 million at the end of the biennium. Assembly Republicans have indicated strong support for the plan, while Democrats and Senate Republicans have expressed concern.
The legislature is in special session to consider the proposal.
Shared Governance
PROFS continues to lobby to preserve shared governance as described in Chapter 36 of state statutes and UW System Regent policies. Key legislators said they would like to see changes in university governance at a Regent meeting last fall.
Fall Elections
State Senator Dale Schultz (R-Richland Center) announced he will not seek re-election in November. Schultz has been at odds with his Republican Senate colleagues and faced a Republican primary opponent in August.
State Senator Kathleen Vinehout announced last month she will not challenge former Trek executive and Commerce Secretary Mary Burke for the Democratic gubernatorial nomination.
Wisconsin Retirement System
The State of Wisconsin Investment Board (SWIB) announced last month the two funds it manages for the Wisconsin Retirement System (WRS) posted strong gains in 2013, allowing for the first pay increase in five years for annuitants.
PROFS is currently monitoring two bills affecting WRS:
- Assembly Bill 470 would increase the minimum retirement age by two years. If passed, it would apply to workers 40 and younger.
- Assembly Bill 471 would calculate benefits based on the five highest earnings periods, a change from the current three-year formula.
Both bills are in committee awaiting a public hearing.
UW System
The University of Wisconsin Board of Regents appointed UW Colleges and UW Extension Chancellor Raymond Cross next president of the University of Wisconsin System. Cross succeeds Kevin Reilly who stepped down in December to take a position with the American Council on Education. UW-Extension Interim Provost and Vice Chancellor Aaron Brower was named Interim Chancellor of UW Colleges and Extension.
Several campuses are in the process of searching for new chancellors – UW-Green Bay, UW-Stout, UW-Oshkosh, and UW-Colleges and Extension.
Wisconsin Retirement System Funds Show Strong Gains in 2013
The State of Wisconsin Investment Board (SWIB) announced earlier this week that the two funds it manages for the Wisconsin Retirement System (WRS) posted strong gains in 2013, allowing for the first pay increase in five years for annuitants.
The Core Fund ended the year with a 13.5 percent gain and the riskier Variable Fund posted a 29 percent gain. These gains surpassed benchmarks set by SWIB.
Morningstar recently recognized WRS as the strongest state pension in country, and the Pew Center on the States found WRS to be fully-funded and called it a “solid performer.”
Three state departments released a report in 2012 recommending no changes to WRS. The legislature requested the study as part of the 2011-13 state budget. In particular, the study was to examine the possibility of allowing WRS participants to choose a defined contribution plan or opt out of WRS altogether.
PROFS is currently monitoring two bills affecting WRS:
- Assembly Bill 470 would increase the minimum retirement age by two years. If passed, it would apply to workers 40 and younger.
- Assembly Bill 471 would calculate benefits based on the five highest earnings periods, a change from the current three year formula.
Both bills are in committee awaiting a public hearing.
Changes to WRS Proposed
State Representative Duey Stroebel (R-Cedarburg), right, has introduced two bills that would change Wisconsin Retirement System benefits: Assembly Bill 470 would increase the minimum retirement age by two years. If passed, it would apply to workers 40 and younger. Assembly…
Morningstar: Wisconsin Retirement System Strongest in Nation
According to the Morningstar annual public pension report, The State of State Pension Plans 2013, Wisconsin is home to the strongest public pension in the country. Wisconsin’s plan is 99.9 percent fully-funded, while the national average stands at just 73…
Legislative Update
A recap of PROFS’ recent activities: The Special Task Force on UW Restructuring and Operational Flexibilities concluded its work in June and released its recommendations in August. The committee heard from Professor Brad Barham, chair of the University Committee, at…
Report Advises No Changes to WRS
A report released today by the Department of Administration, the Department of Employee Trust Funds, and the Office of State Employment Relations recommended against any changes to the Wisconsin Retirement System. The report was requested as part of Act 32,…
Pew: WRS Strongest in Nation; Study Due June 30; Governor Open to Changes
As reported earlier this year, Wisconsin Act 32 (the 2011-13 biennial budget) calls for a study of the Wisconsin Retirement System (WRS). The study, due later this week, will examine the establishment of a defined contribution plan, like a 401(k), as an…