New Pension Fund Formula Report OKd

The Orange County Retirement Board on Monday moved a step closer to approving a plan to reduce the amount of money the county contributes to the $2.9-billion employee pension system.

The county wants to cut its contribution, which last year totaled $59 million, in a bid to reduce costs in the wake of its bankruptcy.

County officials stressed that such a move would have no effect on the pensions of more than 20,000 current and retired government workers who use the system.

In determining how much to set aside for worker benefits, the system now assumes that county workers will annually receive an average raise of 6%.

The county wants the system to recalculate its contribution on the assumption that raises will increase by about 3.5% over the next five years, thus reducing its contribution.

“It’s making assumption changes that we think are more appropriate to our budgetary and economic situation,” said Robert A. Griffith, director of the county’s General Services Agency.

An actuarial consultant hired by the retirement board found that the change would not hurt the pension fund and would be in line with nationwide salary trends. On Monday, the board approved the actuary consultant’s report on the county proposal.

County officials said they hope to finalize the plan within weeks and determine exactly how much the changes would save the county as they prepare a new budget.